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policies
A. Basis of presentation
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the
Bank and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the
years ended on 31 December 2025 and 2024.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002,
and Banco de Portugal Notice no. 5/2015 (which revoked Banco de Portugal Notice no. 1/2005), the Group\u2019s
consolidated financial statements are required to be prepared, since 2005, in accordance with International
Financial Reporting Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting
standards issued by the International Accounting Standards Board (IASB), as well as interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated
financial statements and the accompanying notes were approved on 25 March 2026 by the Bank's Board of
Directors and are presented in thousands of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2025 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in
Portuguese. In the event of discrepancies, the Portuguese version prevails.
A1. Comparative information
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1
January 2025. The accounting policies were applied consistently to all entities of the Group and are consistent with
those used in the preparation of the financial statements of the previous year.
The Group's financial statements were prepared under the going concern assumption, the accrual-based
accounting regime and under the historical cost convention, as modified by the application of fair value for
derivative financial instruments, financial assets and liabilities at fair value through profit or loss and financial
assets at fair value through other comprehensive income. Financial assets and liabilities that are covered under
hedge accounting are stated at fair value in respect of the risk that is being hedged, if applicable. Other financial
assets and liabilities and non-financial assets and liabilities are stated at amortised cost or historical cost. Non-
current assets and disposal groups held for sale are stated at the lower of carrying amount or fair value less costs
to sell. Investment properties recognised on the Group's balance sheet are recognised at fair value.The liability for
defined benefit obligations is recognised as the present value of the past liabilities with pensions net of the value
of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice
of the Executive Committee, to make judgements, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and
associated assumptions are based on historical experience and other factors that are believed to be reasonable
under the circumstances and form the basis for making the judgements about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may differ from these estimations. The
issues involving a higher degree of judgment or complexity or for which assumptions and estimations are
significant are presented in note 1.Y.
B. Basis of consolidation
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the
Bank and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1. Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group
controls an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or
has rights, to variable returns from its involvement with the entity and can take possession of these results
through the power it holds over the relevant activities of that entity (de facto control). The financial statements of
subsidiaries are included in the consolidated financial statements from the date on which control commences
until the date on which control ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the
Group can recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal
resulting in loss of control over a subsidiary, any participation retained is revalued at market value on the sale date
and the gain or loss resulting from this revaluation is booked against the income statement.
B2. Investments in associates
Investments in associates are recorded by the equity method from the date that the Group acquires significant
influence until the date it ceases to exist. Associates are those entities in which the Group has significant influence
but not control over the financial and operating policy decisions of the investee. It is assumed that the Group has
significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the
Group does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
- representation on the Board of Directors or equivalent governing body of the investee;
- participation in policy-making processes, including participation in decisions about dividends or other
distributions;
- material transactions between the Group and the investee;
- interchange of the management team;
- provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associates accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in the
associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3. Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair
value, determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly
attributable to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the
fair value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in
which the business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the
difference recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded
until the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a
year since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised
previously on the acquisition date, to reflect newly obtained information about facts and circumstances that
existed at the acquisition date and that, if they were known by then, would have impacted the measurement of
the amounts recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by
then, would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill recorded in the Group's asset is assessed annually in the
preparation of the accounts with reference to the end of the year or whenever there are indications of
eventual loss of value. Impairment losses are recognised in the income statement. The recoverable amount
is determined based on the higher of the asset value in use and the market value after deducting selling
costs, calculated using valuation methodologies supported by discounted cash flow techniques,
considering market conditions, the time value of money and the business risks.
B4. Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is
accounted as a transaction with shareholders and, therefore, no additional goodwill resulting from this
transaction is recognised. The difference between the acquisition cost and the fair value of non-controlling
interests acquired is recognised directly in reserves. On this basis, the gains and losses resulting from the
sale of controlling interests that do not impact the control position of a subsidiary are always recognised
against reserves.
B5. Loss of control
The gains or losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6. Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional
currency, defined as the currency of the primary economic environment in which they operate or the currency in
which the subsidiaries obtain their income or finance their activity. In the consolidation process, assets and
liabilities, including goodwill, of foreign subsidiaries are converted into euro at the official exchange rate on the
balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity
methods, exchange differences, between the conversion to euro of the equity at the beginning of the year and its
value in euro at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are
recognised against \u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that
are designated and qualified as hedging instruments related to foreign operations are recorded in equity under
\"Reserves and retained earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted
against profit and loss of the year.
The income and expenses of these subsidiaries are converted to euro at an approximate rate of the rates on the
dates of the transactions, using a monthly average considering the initial and final exchange rates of each month.
Exchange differences from the conversion to euro of the profits and losses for the reporting period, arising from
the difference between the exchange rate used in the income statement and the exchange rate prevailing at the
balance sheet date, are recognised in \"Reserves and retained earnings - exchange differences resulting from the
consolidation of Group's companies\". The exchange rates used by the Group are detailed in note 55.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to
the investment in the foreign operation and to the associated hedge transaction previously recognised in reserves
are transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities
that present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-
monetary assets and liabilities are adjusted based on the price index from the date of acquisition. The restated
values of assets are reduced by the amount that exceeds their recoverable amount, in accordance with the
applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associates, its effects are included in the
Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items
are recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy
until 31 December 2018. This classification is no longer applicable as at 1 January 2019.
B7. Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from
these transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains
and losses arising from transactions with associates and jointly controlled entities are eliminated in the proportion
of the Group's investment in these entities.
C. Financial instruments (IFRS 9)
C1. Financial assets
C1.1. Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013 \u201cFinancial assets at amortised cost\u201d;
\u2013 \u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013 \u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013 the Group's business model for the management of the financial asset; and,
\u2013 the characteristics of the contractual cash flows of the financial asset.
In the initial determination of fair value, if it is not based on observable market data for the financial instruments
under analysis, the difference (when materially relevant) between the transaction price and the fair value (day 1
P&L) should not be immediately recognised in profit or loss. It should be deferred and recognised as a gain or loss
only when the unobservable inputs become observable, or as the entity completes the transaction.
Business Model Evaluation
The Group, at the time of acquisition of financial instruments, carried out an evaluation of the business model in
which the\u00a0 are held at portfolio level, since this approach reflects how assets are managed and how that
information is made available to management bodies. The information considered in this evaluation included:
\u2013 the policies and purposes established for the portfolio and the practical operability of these policies, including
how the management strategy focuses on receiving contractual interest, maintaining a certain interest rate
profile, adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the
realisation of cash flows through the sale of the assets;
\u2013 how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013 the evaluation of the risks that affect the performance of the business model (and of the financial assets held
under this business model) and the way these risks are managed;
\u2013 the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the
assets under management or on contractual cash flows received; and,
\u2013 the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the
expectations about future sales. However, sales information should not be considered individually, but as part
of an overall assessment of how the Group establishes financial asset management objectives and how cash
flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured
at fair value through profit or loss because they are not held either for the collection of contractual cash flows
(HTC), nor for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial
recognition. \"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with
the amount owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk
and administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation
included the analysis of the existence of situations in which the contractual terms can modify the periodicity and
the amount of the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group
considered:
\u2013 contingent events that may change the periodicity and the amount of the cash flows;
\u2013 characteristics that result in leverage;
\u2013 terms of prepayment and extension of maturity;
\u2013 terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013 characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013 the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal
value;
\u2013 the prepayment represents substantially the nominal amount of the contract plus accrued contractual
interest, but not paid (may include reasonable compensation for prepayment); and,
\u2013 the prepaid fair value is insignificant at initial recognition.
C1.1.1. Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following
conditions are met:
\u2013 the financial asset is held within a business model whose objective is to hold financial assets in order to collect
their contractual cash flows; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and
advances to customers and debt instruments managed based on a business model whose purpose is to receive
their contractual cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the
funds are made available to the counterparty (settlement date). Debt instruments are recognised on the trade
date, that is, on the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the
effective interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are recorded in \"Gains/(losses) arising from derecognition
of financial assets and liabilities not measured at fair value through profit or loss\".
C1.1.2. Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive
income\" if both of the following conditions are met:
\u2013 the financial asset is held within a business model whose objective is both to collect its contractual cash flows
and to sell this financial asset; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent
retribution recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may
irrevocably choose to classify it in the category of \"Financial assets at fair value through other comprehensive
income\" (FVOCI). This option is exercised on a case-by-case basis and is only available for financial instruments
that comply with the definition of equity instruments provided in IAS 32 and cannot be used for financial
instruments whose classification as an equity instrument under the scope of the issuer is made under the
exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
C1.1.3. Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2. Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management
has changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including
the ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other
comprehensive income is not allowed, nor of financial instruments designated at fair value through profit or
loss.
C1.3. Modification and derecognition of financial assets
General principles
i) The Group shall derecognise a financial asset when, and only when:
\u2013 the contractual rights to the cash flows from the financial asset expire; or,
\u2013 it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii) The Group transfers a financial asset if, and only if, it either:
\u2013 transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013 retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual
obligation to pay the cash flows to one or more recipients in an arrangement that meets the conditions
presented in note iii).
iii) When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'),
but assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'),
the Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are
met:
\u2013 the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013 the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013 the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without
material delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash
equivalents (as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the
collection date until the date of required remittance to the eventual recipients, and interest earned on such
investments is passed to the eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and rewards arising from owning the financial asset. In this case:
\u2013 if the Group transfers substantially all the risks and rewards arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013 if the Group retains substantially all the risks and rewards arising from owning the financial asset, it shall
continue to recognise the financial asset;
\u2013 if the Group neither transfers nor retains substantially all the risks and rewards arising from owning the
financial asset, it shall determine whether it retained control of the financial asset. In this case:
a) if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as
assets or liabilities, any rights and obligations created or retained in the transfer;
b) if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and rewards (see prior note) is evaluated by comparing the Group\u2019s exposure, before and
after the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset
depends on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in
its entirety to an unrelated third party and can exercise that ability unilaterally without needing to impose
additional restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained
control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of
new ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that
may lead to the derecognition of a financial asset.
The Group considers that a modification of the terms and conditions of a credit exposure will result in
derecognition of the transaction and in recognition of a new transaction when the modification translates into at
least one of the following conditions:
\u2013 Creation of a new exposure that results from a debt consolidation, without any of the derecognised instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013 Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to
the residual maturity in the moment of the modification;
\u2013 Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013 Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or
managed within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on
the financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv
of the above paragraphs should be checked (the other criteria listed in this paragraph are not relevant in such
situations).
Under the regulatory changes that occurred in Poland and the negotiations with customers holding mortgage
loans in foreign currency described in note 58, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a
given asset is not derecognised, the Group adjusts the gross book value of the financial asset and recognises the
profit or loss due to the modification in the Income Statement - Results on modification. The adjustment to the
gross carrying amount of a financial asset is the difference between the discounted cash flows before and after
contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its
entirety or partially. Loan recoveries and loans written off are recorded under the Impairment of financial assets at
amortised cost and in off-balance sheet accounts, respectively.
C1.4. Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit
impairment in the moment of their initial recognition. An asset is credit-impaired if one or more events have
occurred with a negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013 financial assets arising from a recovery process, where there have been changes to the terms and conditions of
the original agreement, which presented objective evidence of impairment that resulted in its derecognition
(note C1.3) and recognition of a new contract that reflects the credit losses incurred;
\u2013 financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses
(ECL) are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition,
the gross book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value
before being recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5. Impairment losses
C1.5.1. Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the
following accounting items:
C1.5.1.1. Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets
against the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2. Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\",
against other comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3. Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are
recognised in liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other
provisions\" (in the income statement).
C1.5.2. Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk
since its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013 Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to
expected credit losses resulting from a default event that may occur within 12 months after the reporting date
(12-month expected credit losses);
\u2013 Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note
C1.5.3) but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with
operations classified in this stage correspond to the expected credit losses resulting from default events that
may occur over the expected residual life of the operations (lifetime expected credit losses);
\u2013 Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified
at this stage correspond to lifetime expected credit losses.
C1.5.3. Significant increase in credit risk (SICR)
The Group uses a set of criteria to determine whether there is a significant increase in the Probability of Default
(PD) (Significant increase in Credit Risk) associated with credit exposures, which leads to a stage 2 classification.
Among the criteria considered by the Group, the following are noteworthy:
(i) customers classified with procedural risk grade 123 or 124, due to material arrears of more than 30 days or being
monitored by credit recovery, or with no assigned risk grade;
(ii) customers with a deterioration of the risk grade on the internal scale, above pre-defined thresholds, between
the initial recognition date of the contract and the impairment calculation date;
(iii) relative change in the cumulative Probability of Default (PD) for the remaining maturity of the exposure
(Lifetime Forward-looking PD) above a certain threshold;
(iv) exposures whose absolute value of the 12-month Forward-looking PD at the reporting date exceeds a certain
threshold;
(v) customers with operations restructured due to financial difficulties;
(vi) customers with incidents reported through the Banco de Portugal's Central Credit Register; and
(vii) customers subject to individual analysis for whom a stage 2 classification has been concluded due to the
occurrence of a significant increase in credit risk, taking into account a set of predetermined indicators for this
purpose.
Exposures that no longer meet the criteria to be classified as stage 2 are classified as stage 1.
C1.5.4. Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than EUR 100 (retail) or more than EUR 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in
which the customer is in this situation have been counted, it is classified as default.
The existence of a material payment delay gives rise to the default setting of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i. Credit restructuring due to financial difficulties with loss of value;
ii. Delay after restructuring due to financial difficulties;
iii. Recurrence of restructuring due to financial difficulties;
iv. Credit with signs of impairment (or stage 3 of IFRS 9);
v. Insolvency or equivalent proceedings;
vi. Litigation;
vii. Guarantees of operations in default;
viii. Credit sales with losses;
ix. Credit fraud;
x. Unpaid credit status;
xi. Breach of covenants in a credit agreement;
xii. Spread of default in an economic group;
xiii. Cross default in BCP Group.
C1.5.5. Estimates of expected credit losses - Individual analysis
1. Customers who are in one of the following conditions are subject to individual analysis:
Customers in
default
Customers in litigation or insolvency, if the total exposure of the group members in these
situations exceeds EUR 1 million
Customers integrated into groups with an exposure over EUR 5 million, if they have a risk grade 125
Groups or
customers who are
not in default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over EUR 5 million, if a group member has a risk grade 124
or has a restructured loan and a risk grade 123\u00a0
Groups or customers with an exposure over EUR 10 million, if at least one member of the group is
in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds EUR 25
million
2. Regardless of the criteria described in the previous point, the individual analysis is only performed for customers
with a credit exposure over EUR 500,000, while customers with exposure below this limit are not considered
for the purpose of determining the exposure referred to in the previous point.
3. Other customers that do not meet the criteria defined in 1 will also be subject to individual analysis, if under the
following conditions:
\u2013 they have impairment as a result of the latest individual analysis;
\u2013 are classified in stage 2 as a result of the latest revision of the questionnaire analysing the signs of financial
difficulties;
\u2013 according to recent information, they show a significant deterioration in risk levels.
4. The individual analysis includes the following procedures:
\u2013 for customers that are not in default, the analysis of financial difficulties indicators to determine whether the
customer has objective signs of impairment, or whether it should be classified in stage 2 given the occurrence
of a significant increase in credit risk, considering for this purpose a set of predetermined signs;
\u2013 for customers in default or for which the previous analysis has allowed to conclude that the customer has
objective signs of impairment, determination of the loss.
5. For the situations identified in the first paragraph of point 4 above, involving corporate customers, the analysis
is the responsibility of the Rating Division, and the responsibility of the Credit Division for the remaining
customers.
6. For the situations identified in the second paragraph of point 4 above, the individual analysis to determine the
loss is the responsibility of the customer's management divisions and of the Credit Division, the latter with
regard to the customers managed by the Commercial Networks.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the
total credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed
at each balance sheet date the existence of objective evidence of impairment. In the assessment of impairment
losses in individual terms, the following factors were considered:
\u2013 total exposure of each customer towards the Group and the existence of overdue loans;
\u2013 viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations
in the future;
\u2013 the existence, nature and estimated value of the collaterals associated to each loan;
\u2013 the customer\u2019s available assets in liquidation or insolvency situations and the existence of preferential creditors;
\u2013 the amount and expected recovery term.
7. Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery
period to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk
Office as part of the regular process of collecting information, accompanied by detailed justification of the
proposed impairment.
8. The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be
a weighted rate considering the different recovery prospects for each part of the customer's liabilities.
9. The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualised perspective, the latter when cases that, due to their specificity, have
a high degree of uncertainty regarding the expected recovery estimation are identified.
10. The macroeconomic adjustment set out in previous point should be analysed annually and weighted
according to the type of recovery strategy associated with the exposure under analysis:
\u2013 for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global
way, to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one
scenario;
\u2013 for Gone Concern strategies (i.e., the recovery estimation is based on the realisation of the collateral), the
impact of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the
projected real estate index indicates significant changes ahead for the current valuation values.
11. It is the responsibility of the units referred to in points 5 and 6 to consider in their forecast macroeconomic
expectations that may influence the recoverability of the debt.
12. For the purposes of the preceding paragraphs, the Group's Economic Studies Area shall disclose the
macroeconomic data that allow the estimations to be made.
13. The decision to consider global impacts related to the going and gone concern scenarios should be made by
the Risk Committee, as proposed by the Risk Office.
14. For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be
considered casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013 recovery of collateral in geographies in which the Group has no relevant recovery experience;
\u2013 recovery of debt related to geographies in which there is strong political instability;
\u2013 recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013 recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013 recovery of debt related to debtors for whom there is a strong negative public exposure.
15. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
16. Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 115 of the Master Scale.
17. The individual analysis must be carried out annually and may be carried out more frequently for customers
who fall into certain situations of possible increased risk. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to
promote the early review of the individual analysis of this customer.
C1.5.6. Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis for the determination of loss are grouped
considering their risk characteristics and subject to a collective impairment analysis. The Group's credit portfolio is
divided by internal risk grades and according to the following segments:
a) Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project
finance, Institutions (banks/financial institutions), Sovereigns and Real estate development;
b) Segments not \u2018low default\u2019:
- Retail: Mortgage, Consumer and Small and medium-sized enterprises - Retail;
- Corporate: Small and medium enterprises - Corporate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013 financial assets with no signs of impairment at the reporting date: the present value of the difference between
the contractual cash flows and the cash flows that the Group expects to receive;
\u2013 financial assets with impairment at the reporting date: the difference between the gross book value and the
present value of the estimated cash flows;
\u2013 unused credit commitments: the present value of the difference between the resulting contractual cash flows
if the commitment is made and the cash flows that the Group expects to receive;
\u2013 financial guarantees: the current value of the expected repayments less the amounts that the Group expects
to recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013 Probability of Default \u2013 PD;
\u2013 Loss Given Default \u2013 LGD; and,
\u2013 Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering
the already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These
models are based on internal data including both quantitative and qualitative factors. If there is a change in the
risk of the counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated
considering the contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates
the LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models
consider the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs.
In the case of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of
high relevance in the determination of LGD, considering the applicable haircuts as well as the estimated time and
associated selling costs.
In the case of exposures from the securities portfolio of issuers that are Banks or Sovereigns, or subordinated
exposures, the LGD to be applied in the credit loss estimate considers the LGD defined for the purpose of
calculating capital requirements (CRR).
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD
values from the counterparty's current exposure and potential changes to its current value as a result of the
contractual conditions, including amortisations and prepayments. For commitments and financial guarantees, the
value of the EAD will consider both the amount of credit used and the expectation of future potential value that
may be used in accordance with the agreement.
For exposures covered by guarantees issued by Mutual Guarantee Societies or by supranational entities, the Bank
applies the PD and LGD parameters associated with these entities to the covered part of the EAD.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a
longer period. The maximum contractual period shall be considered as the period up to the date on which the
Group has the right to require payment or end the commitment or guarantee.
The Group conservatively considers a residual term of 5 years in the case of renewable operations, when in stage 2.
This term was determined based on the behavioural models associated with this type of product.
Incorporation of forward-looking information:
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-
looking information is carried out in the relevant elements considered for the calculation of expected credit losses
(ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing
exposures at the reference date becoming defaulted exposures considers the expected values for a set of
macroeconomic variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the
Group's Economic Studies area. These scenarios, which are used across the Group for various purposes besides
calculating impairment, consider existing forecasts by reference entities.
In December 2025, the Group carried out an update of the macroeconomic scenarios and of the corresponded
adjustment of the parameters considered in the collective impairment model.
It should be noted that, in 2025, the Group revised its IFRS 9 impairment models, focusing on alignment with the
IRB models, which were revised in 2024. This revision covered the criteria for identifying a significant increase in
credit risk \u2013 SICR (stage 2) and the models for estimating PD, LGD, EAD, and calculating ECL, addressing all
relevant components, such as historical information, segmentation, forward-looking adjustments, as well as the
review of the monitoring and backtesting framework
C2. Financial liabilities
C2.1. Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013 \u201cFinancial liabilities at amortised cost\u201d;
\u2013 \u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1. Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a) \u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that
form part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as
hedging instrument).
b) \u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013 the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013 the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in
market conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with
the costs or income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013 the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk
of that liability shall be presented in other comprehensive income;
\u2013 the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest and similar
expense\" based on the effective interest rate of each transaction.
C2.1.2. Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial
guarantee contracts are subsequently measured at the highest of the following amounts:
\u2013 the provision for losses determined according to the criteria described in note C1.5;
\u2013 the amount initially recognised deducted, when appropriate, from the accumulated amount of income
recognised according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial liabilities at amortised cost\" includes d eposits from credit institutions and other funds,
deposits from customers and other funds, as well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are
subsequently measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in
\"Interest and similar expense\", based on the effective interest rate method.
C2.2. Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3. Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.
C3. Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
C4. Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and
foreign exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge
accounting are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in
accordance with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013 at the inception of the hedge there is formal documentation of the hedge;
\u2013 the hedge is expected to be highly effective;
\u2013 the effectiveness of the hedge can be reliably measured;
\u2013 the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013 for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to
variations in cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets
or liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised
through profit and loss, as well as changes in currency risk of the monetary items.
C4.1. Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are
recognised in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or
liability or group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge
accounting, the cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised
until the discontinuance of the hedge accounting are amortised through profit and loss over the residual term of
the hedged item.
C4.2. Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify
as cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge
relations. Any gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and
loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will
affect profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the
hedging relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked,
the hedge relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative
accumulated in equity until the date of the discontinued hedge accounting can be:
\u2013 deferred over the residual period of the hedged instrument; or,
\u2013 recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised
in equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income
statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was
reported in equity is immediately transferred to profit and loss.
C4.3. Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such,
the Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective
tests in order to demonstrate at each reporting period the effectiveness of the hedging relationships,
demonstrating that the variations in fair value of the hedging instrument are hedged by the fair value variations of
the hedged item in the portion assigned to the risk covered. Any ineffectiveness is recognised immediately in
profit and loss when incurred.
C4.4. Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange
gain or loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The
gain or loss relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses
accumulated in equity related to the investment in a foreign operation and to the associated hedge operation are
recognised in equity and transferred to profit and loss, on the disposal of the foreign operation as part of the gain
or loss from the disposal.
C5. Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host
instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and rewards of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D. Securitisation operations
D1. Traditional securitisations
As at 31 December 2025, Banco Comercial Portugu\u00eas held two residential mortgage securitisation operations in
Portugal: Magellan Mortgages no.3 and no.4. Initially, the portfolios of these operations were derecognised from
the Bank\u2019s individual balance sheet, as the risks and rewards related to the residual portions of the referred
transactions, were transferred to institutional investors.
By purchasing a part or all of the most subordinated residual portion, the Group maintained control of the assets
and liabilities of Magellan Mortgages no.3, this Special Purpose Entity (SPE) being consolidated in the Group\u2019s
financial statements, in accordance with the accounting policy described in note 1 B.
The two operations are traditional securitisations, where each mortgage loan portfolio was sold to a Portuguese
Loan Securitisation Fund, which has financed this purchase through the sale of securitisation units to an Irish-SPE.
At the same time, this Special Purpose Entity (SPE) issued and sold in capital markets the different tranches of
bonds.
D2. Synthetic securitisations
As at 31 December 2025, Banco Comercial Portugu\u00eas held in Portugal two synthetic securitisation operations, with
similar characteristics, with reference to credit portfolios granted by the Bank mainly to Small and Medium
Enterprises (SMEs).
The operations currently underway are as follows:
\u2013 Caravela SME no.5, initiated on 20 December 2022, is supported by a diversified portfolio of medium-and-
long-term loans, leasing contracts and commercial paper programmes.
\u2013 Caravela SME no.6, initiated on 28 February 2024, is supported on a credit portfolio of short-term exposures to
Corporate customers, including current accounts overdrafts, authorised overdrafts and confirming
agreements.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitisations, under CDS, the
risk of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity.
The full amount of the mezzanine was placed on the market, with the Bank retaining the risk inherent of the full
amount of the senior and equity tranches.
It should also be noted that in both transactions, the product of the CLNs issue was invested by the SPE in a
deposit, which fully collateralises the responsibilities in the presence of its creditors including BCP in accordance
with the CDS.
Within the scope of the active management of its synthetic securitisation structures, the Bank exercised the
termination options provided for in the contracts relating to Caravela SME No. 4 and Caravela SME No. 3, whose
respective Credit Default Swap (CDS) contracts were terminated on 22 December 2025 and 30 December 2025,
respectively (as described in note 22).
E. Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to
deliver cash or another financial asset to another entity or to exchange financial assets or financial liabilities with
another entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may
be settled in the issuer's own equity instruments, it is either a non-derivative that includes no contractual
obligation for the issuer to deliver a variable number of its own equity instruments or a derivative that will be
settled only by the issuer exchanging a fixed amount of cash or another financial asset for a fixed number of its
own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity
after deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to
the amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised
in equity, net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is
solely at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are
deducted to equity.
F. Securities borrowing and repurchase agreement transactions
F1. Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are
measured in accordance with the applicable accounting policy. Cash collateral received in respect of securities
lent is recognised as a financial liability. Securities borrowed under securities borrowing agreements are not
recognised. Cash collateral placements in respect of securities borrowed are recognised under loans and advances
to either banks or customers. Income and expenses arising from the securities borrowing and lending business
are recognised on an accrual basis over the period of the transactions and are included in interest income or
expense (net interest income).
F2. Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities
substantially equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to
reselling agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in
loans and advances to customers or loans and advances to credit institutions. The receivables are collateralised by
the related securities. Securities sold through repurchase agreements continue to be recognised in the balance
sheet and are revaluated in accordance with the applicable accounting policy. The amounts received from the
proceeds of these securities are considered as Deposits from customers and other funds or Deposits from credit
institutions and other funds. The difference between the acquisition/sale and reselling/repurchase conditions is
recognised on an accrual basis over the period of the transaction and is included in interest income or expenses.
G. Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities
that include at least a non-current asset) and discontinued operations are classified as held for sale when the
intention is to sell the referred assets and liabilities and when the referred assets or group of assets are available
for immediate sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly
probable, in accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed
to a plan to sell the asset (or disposal group) and must have initiated an active program to locate a buyer and
complete the plan. In addition, the asset (or disposal group) must be actively marketed for sale at a price that is
reasonable in relation to its current fair value. Furthermore, it should be expected that the sale qualifies for
recognition as a completed sale within one year from the date of classification, except as permitted by paragraph
9 of IFRS 5, and that the Group remains committed to the asset sales plan and the delay is caused by events or
circumstances beyond its control.
If the requirements set out in IFRS 5 for these assets are not met, the balance sheet value and respective
impairment are reflected in the balance \"Other assets\".
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all
assets and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their
reclassification, these assets or disposal groups are measured at the lower of their cost and fair value less costs to
sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1. Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own
properties that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's
consolidation scope, whose capital or units acquired by the Group as a result of the recovery loans are treated as
INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing
on the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property,
net of estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do
Mercado de Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of
consolidating Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H. Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of
leases:
\u2013 from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013 from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which
results in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the
lease term ends within 12 months or for those which the underlying asset is of low-value and, in these cases,
the lessee may opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments
associated with these leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below EUR 5,000. Additionally,
this standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or
contains a lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all
the economic benefits of using it, and the right to choose how to use the identified asset over a period in
exchange of a payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013 a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability
plus the value of payments made (fixed and/or variable), deducted from any lease incentives received,
penalties for terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the
lessee with the dismantling and removal of the underlying asset and/or with the recovery of its location.
Subsequently, it will be measured according to the cost model (subject to depreciations/amortisations and
impairment tests);
\u2013 a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013 fixed payments deducted from any lease incentives receivable;
\u2013 variable lease payments that depend on a rate or an index, initially measured considering the rate or
index as at the commencement date;
\u2013 amounts expected to be paid by the lessee under residual values guarantees;
\u2013 the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013 payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option
to end the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate
curve (swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract.
For term contracts, that date is considered as the end of lease date, while for contracts without term, or with
renewable terms, it is assessed using the date in which the contract is enforceable, as well as eventual economic
penalties associated with the lease contract. In the evaluation of enforceability, the particular clauses of the
contracts are considered, as well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013 by increasing their carrying amount to reflect interest;
\u2013 by reducing their carrying amount to reflect lease payments;
\u2013 carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the
review of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset)
whenever:
\u2013 the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which
case the lease liability is remeasured by discounting the revised lease payments using the revised discount
rate;
\u2013 the lease payments change due to changes in an index or rate or a change in expected payment under a
guaranteed residual value, in which cases the liability is remeasured by discounting the revised lease payments
using the initial discount rate (unless the lease payments change is due to a change in a floating interest rate,
in which case a revised discount rate is used);
\u2013 a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If
the lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group
expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the
underlying asset. The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013 in the consolidated income statement:
(i) recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii) recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii) recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013 in the consolidated balance sheet:
(i) recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of
financial assets related to sublease operations measured accordingly to IFRS 9;
(ii) recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii) recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013 in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013
Payments (cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to
lease contracts of low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in
other sundry liabilities and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019
capital portions, as detailed in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of
an underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and
rewards inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary,
and the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the
underlying asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
I. Recognition of income from services and commissions
In accordance with IFRS 15, the Group recognises revenue associated with services and commissions when (or as)
a performance obligation is satisfied when transferring a service, based on the transaction price associated with
this performance obligation. In this context, the Group takes the following steps to recognise revenue associated
with services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the
service provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations
associated with each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also
considering the contractual terms established with the counterparty. According to this definition, a service is
transferred when the customer obtains the benefits and control associated with the service provided. In this
context, the Group also identifies whether performance obligations are met over time (\u201cover time\u201d) or at an exact
moment (\u201cpoint in time\u201d), with revenue being recognised accordingly.
- Measurement (price to be recognised associated with each performance obligation): (i) determine the
transaction price associated with the service provided, considering the contractual terms established with the
counterparty and its usual commercial practices. The transaction price is the amount of consideration to which
the Group expects to be entitled in exchange for transferring promised services to the customer, excluding
amounts collected on behalf of third parties. The Group includes in the transaction price part or all of the
estimated amount of the variable consideration associated with a performance obligation, only to the extent that
it is highly probable that a significant reversal in the amount of the accrued revenue recognised will not occur
when the uncertainty associated with that variable consideration is subsequently resolved; and (ii) allocate the
transaction price to each of the performance obligations identified under the contract established with the
customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a
financial instrument, income resulting from services and commissions is recorded in net interest income (note
C.3).
J. Gains/(losses) on financial operations at fair value through profit or loss, Foreign
exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses)
arising from derecognition of financial assets and liabilities not measured at fair
value through profit or loss
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e.,
fair value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding
dividends received. This balance also includes the gains and losses on sale of financial assets at fair value through
other comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair
value of hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this
balance, as well as the foreign exchange gains or losses.
K. Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements.
Fees and commissions arising from this activity are recognised in the income statement in the period in which
they occur.
L. Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses.
Subsequent costs are recognised as a separate asset only when it is probable that future economic benefits will
result for the Group. All other repairs and maintenance expenses are charged to the income statement during the
financial period in which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated
and an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The
recoverable amount is determined as the highest between the fair value less costs to sell and its value in use
calculated based on the present value of future cash flows estimated to be obtained from the continued use of
the asset and its sale at the end of the useful life. The impairment losses of the fixed tangible assets are recognised
in the income statement of the period.
M. Investment properties
Real estate properties owned by the Group are recognised as \u2018Investment properties\u2019 considering that the main
objective of these buildings is their capital appreciation on a long-term basis and not their sale in a short-term
period, nor their maintenance for own use.
These investments are initially recognised at their acquisition cost, including transaction costs, and subsequently
revaluated at their fair value. The fair value of investment properties should reflect the market conditions at the
balance sheet date. Changes in fair value are recognised in the income statement, as \"Other operating income/
(expenses)\" (note 6).
The experts responsible for the valuation of the assets are properly certified for that purpose, being registered in
CMVM.
N. Intangible assets
N1. Research and development expenditure
The Group does not capitalise any research and development costs. All expenses are recognised as costs in the
period in which they occur.
N2. Software
The Group recognises as intangible assets the costs associated to software acquired from external entities and
depreciates them on a straight-line basis by an estimated lifetime of 6 years. The Group does not capitalise
internal costs arising from software development.
Whenever there is an indication that an intangible fixed asset may be impaired, an estimate of its recoverable
amount is made, and an impairment loss should be recognised whenever the net value of that asset exceeds its
recoverable amount. The recoverable amount is determined as the higher of its fair value less costs to sell and its
value in use, which is calculated based on the present value of the estimated future cash flows expected to be
obtained from the continued use of the asset and its disposal at the end of its useful life. Impairment losses on
intangible fixed assets are recognised in profit or loss for the period.
O. Cash and cash equivalents
For the purposes of the cash flow statement, the balance \u201cCash and cash equivalents\u201d comprises balances with a
maturity of less than three months from the date of acquisition, where \"Cash\", \"Cash and deposits at Central
Banks\" and \"Loans and advances to credit institutions\" are included.
P. Offsetting
Financial assets and liabilities are offset and recognised at their net book value when: i) the Group has a legal right
to offset the amounts recognised and transactions can be settled at their net value; and, ii) the Group intends to
settle on a net basis or realize the asset and settle the liability simultaneously. Considering the current operations
of the Group, no compensation of material amount is made. In case of reclassification of comparative amounts,
the provisions of IAS 1.41 are disclosed: i) the nature of the reclassification; ii) the amount of each item (or class of
items) reclassified; and, iii) the reason for the reclassification.
Q. Foreign currency transactions
Transactions in foreign currencies are converted into the respective functional currency of the operation at the
foreign exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are converted into the respective functional currency of the operation at the foreign exchange rate on
the reporting date. Foreign exchange differences arising from conversion are recognised in the income statement.
Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are
converted into the respective functional currency of the operation at the foreign exchange rate on the date of the
transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are
converted into the respective functional currency of the operation at the foreign exchange rate on the date that
the fair value was determined against profit and loss, except for financial assets at fair value through other
comprehensive income, for which the difference is recognised against equity.
R. Employee benefits
R1. Defined benefit plans
The Group has the responsibility to pay its employees' retirement pensions, invalidity pensions and survivor\u2019s
pensions for their death, in accordance with the terms of the two collective labour agreements approved. These
benefits are provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas
Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no.
54/2009, all employees were covered by the provisions of the social security chapter of the ACT, and for employees
who were already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July
2009, in accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements
to the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto
de Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January
2012. The plan was cut, and employees were given individual acquired rights. On that date, the Group also
proceeded to the settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now
covers their maternity, paternity, adoption and pension benefits. However, the banks remain liable for
benefits that concern illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the
employee, replacing the Banking Social Healthcare System which was extinguished by the decree law referred
above. As a consequence of this amendment the capability to receive pensions by the actual employees are
covered by the General Social Security Scheme regime, considering the service period between 1 January 2011 and
the retirement age. The banks support the remaining difference for the total pension assured in the Collective
Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to
be borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit
during the average lifetime of the pension until the normal retirement age is reached. The calculation of the
liability for pensions carried out periodically by the actuary considers this effect and is calculated considering the
actuarial assumptions in force, ensuring that the liabilities calculated as at 31 December 2010, not considering the
effect of the integration of bank employees into the General Social Security Scheme are fully covered and
deducted from the amount of the effect recognised until the date. The component of this effect for the year is
recognised under the heading \"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December,
an agreement was established between the Government, the Portuguese Banking Association and the Banking
Labour Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to
pensioners and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of
Collective Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in
pensions as well as any other complements, namely, contributions to the Health System (SAMS), death benefit
and death before retirement benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the
two union federations of the unions that represent the Group's employees, which introduced changes in the
Social Security clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new
ACT was published by the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and
the effects were recorded in the financial statements of 31 December 2016, for employees associated with these
four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the
new ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the
effects of this new ACT recorded in the financial statements as at 31 December 2017, for SBN associate employees.
The most relevant changes\u00a0 in the ACT were the change in the retirement age (presumed disability) from 65 years
to 66 years and two months in 2016 and the subsequent update of an additional month in each year, which
cannot, in any case, be higher than the one in force at any moment in the General Regime of Social Security, the
change in the formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new
benefit called the End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had
an impact on the present value of the liabilities with services rendered and were recognised in the income
statement for the year 2016 under \"Staff costs\".
In 2017, after the authorisation of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF -
Portuguese Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was
amended. The main purpose of the process was to incorporate into the pension fund the changes introduced in
the Group's ACT in terms of retirement benefits, as well as to transfer to the pension fund the responsibilities that
were directly chargeable to the company (extra-fund liabilities). The pension fund has a part exclusively for the
financing of these liabilities which, in the scope of the fund, is called Additional Complement. The End of Career
Premium also became the responsibility of the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year
basis on 31 December and 30 June of each year, and whenever there are significant market fluctuations or
significant specific events, such as changes in the plan, curtailments or settlements since the last estimation. The
responsibilities with past service are calculated using the Projected Unit Credit method and actuarial assumptions
considered adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately
for each plan by estimating the amount of future benefit that employees have earned in return for their service in
the current and prior periods. The benefit is discounted to determine its present value, using a discount rate
determined by reference to interest rates of high-quality corporate bonds that have maturity dates approximating
the terms of the Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of
the Pension Plan's assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability
with retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the
determination of the retirement pension liabilities. On this basis, the income/cost net of interest includes the
interest costs associated with retirement pension liabilities and the expected return of the plan's assets, both
measured based on the discount rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences
between actuarial assumptions used and the amounts actually observed (experienced gains and losses) and
changes in actuarial assumptions and (ii) gains and losses arising from the difference between the expected
return of the plan's assets and the amounts obtained, are recognised against equity under \"Other comprehensive
income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii)
the income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and,
(v) the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension
plan is recognised as interest and similar income or interest and similar\u00a0 expense depending on their nature. The
costs of early retirements correspond to the increase in liabilities due to the employee's retirement before
reaching the age of retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the
spouse and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific
contribution plan that ensures the solvency of the fund. In the end of each year, according to Banco de Portugal
Notice no. 12/2001, the minimum level required for the responsibilities funding must be 100% regarding pension
payments and 95% regarding past services of active employees.
R2. Revision of the salary tables for employees in service and pensions in payment
During 2025, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements,
for the conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, an increase of 2.50% was agreed on 2 January 2025 for salary tables and other pecuniary clauses
for the year 2025, with the unions: \u201cSBN \u2013 Sindicato dos Trabalhadores do Setor Financeiro de Portugal\u201d, \u201cSBC -
Sindicato Nacional dos Trabalhadores da Banca, Seguros e Tecnologias\u201d and \u201cSindicato da Banca, Seguros e
Tecnologias - MAIS SINDICATO\u201d, within the scope of the mediation process which took place at Government
Labour Minister Department \u201cDGERT \u2013 Dire\u00e7\u00e3o-Geral do Emprego e das Rela\u00e7\u00f5es de Trabalho\u201d, and according
with the proposal presented by this entity on 23 December 2024 to the parties under mediation.
Negotiations are still ongoing with the \u201cSIB \u2013 Sindicato Independente da Banca\u201d for the revision of salary tables
and other financial clauses for 2024 and 2025, as well as negotiations with the \u201cSindicato Nacional dos Quadros
T\u00e9cnicos Banc\u00e1rios (SNQTB)\u201d for the 2025 revision.
R3. Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees
are recognised as expenses when incurred.
As at 31 December 2025, the Group has two defined contribution plans. One plan covers employees who were
hired before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and
equal to 1% of the annual remuneration paid to covered employees in the previous year. Contributions shall only
be made if the following requirements are met: (i) the Bank's ROE equals or exceeds the rate of government
bonds of 10 years plus 5 percentage points, and (ii) distributable profits or reserves exist in the accounts of Banco
Comercial Portugu\u00eas. As in the year 2025 the indicated requirements were fulfilled a provision for the annual
contribution, which will be carried out in May 2026, was recorded in the 2025 costs.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the
current month, by the Group and by the employees. This contribution has a mandatory character and is defined in
the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4. Variable remuneration paid to employees
In the remuneration policy for employees in force, it is foreseen an annual variable remuneration system / profit
distribution for employees not covered by commercial incentive systems, which is based on the level of results
achieved by the Bank and the principle of discretion based on the level of responsibility and contribution of
everyone to the Bank's results. Based on this assessment, and provided that a Bank's minimum level of
performance, as measured by a set of quantitative indicators, is met, the amount of the variable remuneration to
be attributed to each employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the
respective allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to
employees is recorded against the income statement in the period to which it relates.
R5. Share-based compensation plan
As at 31 December 2025, a variable compensation plan / profit distribution with BCP shares is in force for the
members of the Executive Committee and for the employees considered Key Function Holders (includes Key
Management Members), resulting from the Remuneration Policy for Employees approved for the year 2025 and
the Remuneration Policy for members of the management and supervisory bodies approved for the fiscal year
2025 and following years, with the changes that may be approved in each financial year, namely by the General
Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the management and supervisory
bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to
the Board of Directors and the remaining employees whose professional activities have a significant impact on the
Bank's risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual
variable remuneration / profit distribution system is foreseen, which is based on the level of results achieved by the
Bank, and for which a discretion assessment of the performance of the Executive Committee is carried out on an
annual basis based on quantitative and qualitative data. According to this assessment and your annual fixed
remuneration, and provided that a Bank's minimum level of performance as measured by a set of quantitative
indicators is met, the amount of the variable remuneration to be attributed to each members of the Executive
Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in
the year following the financial year in question. For the members with variable remuneration awarded greater
than the fixed annual remuneration earned in the financial year in question, 60% of the amount must be deferred.
The amounts related to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The
number of BCP shares attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration / profit distribution system for
Employees not covered by Commercial Incentives Systems, which is based on the level of results achieved by the
Bank and the principle of discretion based on the level of responsibility and contribution of everyone to the Bank's
results. As a result of this assessment and the fixed reference remuneration for the function performed, and
provided that a Bank's minimum level of performance in a set of quantitative indicators is met, the value of the
variable remuneration to be attributed to each Employee is decided by the Executive Committee. For Employees
considered as Key Function Holders (KFH), the payment of the amount of the variable remuneration to be
attributed to each Employee is decided by the Nominations and Remunerations Committee, and its payment
subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year following the
financial year in question. For the KFH with variable remuneration awarded greater than the fixed annual
remuneration earned in the financial year in question, 60% of the amount must be deferred. The amounts related
to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The number of BCP shares
attributed and to be attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy. As provided for in the Remuneration Policy for Employees, if the amount of the annual
variable remuneration awarded to a Key Function Holder is less than EUR 50,000 and does not represent more
than one third of the total annual remuneration of the Key Function Holder the payment of the annual variable
remuneration will be 100% in cash and there will be no deferral.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable
remuneration amount awarded is fully paid in cash in the following year to which it relates.
For the members of the Executive Committee and to the Employees considered as Key Function Holders (KFH), a
long-term variable remuneration (LTVR) system is also foreseen, through which these members may receive
variable remuneration fully paid in BCP shares after the end of the assessment period, from 1 January 2022 until 31
December 2025 (from 1 January 2023 until 31 December 2025 to the Employees Key Function Holders), provided
that a certain level of performance is achieved in a set of long-term objectives. The amount of the long-term
variable remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value
paid in the year following the assessment period to which it relates. If the LTVR for each member of the Executive
Committee or KFH is equal to or greater than the Fixed Annual Remunerations due in the LTVR Assessment
Period, the deferred amount will correspond to 60%. The number of BCP shares attributed results from their
valuation at a price defined in accordance with the approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the
scope of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year
after their payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to
the Key Function Holders, regarding the proportion between its amount and the annual fixed remuneration, is
limited to the limits provided in the respective Remuneration Policy.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely
significant events, duly identified, in which the people covered have had a direct participation.
S. Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets
approved by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred
taxes relating to tax losses and to temporary differences between the accounting net income and the net income
accepted by the Tax Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable
probability that these taxes will be paid or recovered in the future.
Income tax recorded in net income for the year comprises current and deferred tax effects. Income tax is
recognised in the income statement, except when related to items recognised directly in equity, which implies its
recognition in equity. Deferred taxes arising from the revaluation of financial assets at fair value through other
comprehensive income and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are
recognised after in the income statement at the moment the profit and loss that originated the deferred taxes are
recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for
tax purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor
taxable profit and differences relating to investments in subsidiaries to the extent that probably they will not
reverse in the foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairment not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairment will be
deductible for the purposes of determining taxable income for the tax periods in which the legal conditions
required for their tax deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if:
(i) it has a legally enforceable right to offset current tax assets and current tax liabilities; and (ii) the deferred tax
assets and the deferred tax liabilities relate to income taxes released by the same Tax Authority on the same
taxable entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, not having occurred any material impact on the
Bank\u2019s financial statements resulting from its application.
In 2016, the Banco Comercial Portugu\u00eas adhered to the Special Tax Regime for Groups of Companies (RETGS) for
the purposes of corporate income (IRC) taxation, with BCP being the dominant entity. In the financial years of
2025 and 2024, RETGS application was maintained. The group's taxable profit is calculated by the algebraic sum of
taxable profits and individual tax losses of the companies that integrate it.
T. Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by
geographic segments, breaking them down into their respective operating segments whenever deemed relevant.
A business segment is a Group's component: (i) which develops business activities that can obtain revenues or
expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking decisions
about allocating resources to the segment and assess its performance; and (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013 Retail Banking, also including ActivoBank;
\u2013 Companies and Corporate;
\u2013 Private Banking;
\u2013 Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralised management of financial investments, corporate activities, and insurance activity.
International activity:
\u2013 Poland:
\u2013 Retail;
\u2013 Companies and Corporate;
\u2013 Other.
\u2013 Mozambique;
\u2013 Other.
The contribution of the participation in the associate in Angola is included in the \"Other\" segment (International
activity).
U. Provisions, Contingent liabilities and Contingent assets
U1. Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganisations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognised for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected
cost, the most likely result of current actions and considering the risks and uncertainties inherent to the process
result. On the cases that the discount effect is material, provision corresponds to the actual value of the expected
future payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted
through profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the
case that these obligations cease to exist.
U2. Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow
of resources is probable.
U3. Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the
possibility of an outflow of resources regarding economic benefits are not remote. The Group records a contingent
liability when:
i) it is a possible obligation that arises from past events and whose existence will be confirmed only by the
occurrence or non- occurrence of one or more uncertain future events that are not wholly within the control of
the Group; or,
ii) it is a present obligation that arises from past events but is not recognised because:
a) it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b) the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
V. Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares
purchased by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to
consider conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as
dilutive when their conversion to shares would decrease net earnings per share. If the earnings per share are
changed because of an issue with premium or discount or other event that changed the potential number of
ordinary shares or because of changes in the accounting policies, the earnings per share for all presented periods
should be adjusted retrospectively.
W. Insurance contracts
W1. Classification
IFRS 17 is the new accounting standard for insurance contracts, reinsurance contracts and for Investment
contracts with discretionary participation features, covering aspects such as recognition and measurement,
presentation and disclosure of information, replacing IFRS 4 \u2013 Insurance contracts.
The Group issues contracts that include insurance risk, financial risk or a combination of both insurance and
financial risk. A contract, in which the Group accepts a significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance
contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in
accordance with the accounting policies applicable to insurance contracts. A contract issued by the Group that
transfers only financial risk, without discretionary participating features, is accounted for as a financial instrument.
W2. Recognition and measurement
IFRS 17 defines new principles for recognition, measurement, presentation and disclosure of insurance contracts,
reinsurance contracts and Investment contracts with discretionary participation features. The references below
apply to these three types of contracts.
In terms of recognition and measurement, insurance contracts are divided into portfolios, annual cohorts and
groups of contracts. In the initial recognition, contracts that have similar risk and can be managed together, must
be identified, grouping them into portfolios. For measurement purposes, these portfolios are further subdivided
into annual cohorts, according to the issuance year. Each of the cohorts, according to the expected future return,
is then divided into the following groups: i) contracts that are onerous at initial recognition; ii) contracts that do
not present a significant possibility of subsequently becoming onerous; and iii) remaining contracts in the
portfolio.
The liability of an insurance contract begins when one of the following conditions is met: i) beginning of the
coverage period of the contract, ii) date on which the first payment is made by the insured and this becomes due
or iii) in the case of an onerous contract, when it becomes onerous.
IFRS 17 defines 3 measurement models of the insurance liabilities: GMM (General Measurement Model) as a
general modal, VFA (Variable Fee Approach) to be applied for investment contracts, which does not include a
transfer of significant insurance risk and PAA (Premium Allocation Approach), which can be applied for short-term
contracts (less than 1 year).
The measurement of the value of a contract is the sum of (except where contracts are being measured using the
premium allocation approach): (i) the present value of future cash flows; (ii) a non-financial risk adjustment; and
the amount of future profit that is estimated that this contract will generate the Contractual Service Margin (CSM),
unless the contract group is onerous. In this case, the estimated loss is recognised immediately.
The liability for future services in contracts measured using the premium allocation approach is based on
premiums received, less amounts recognised in profit or loss already incurred in the period.
In terms of the discount rate for determining future cash flows, it should: (i) reflect the time value of money; ii) be
consistent with similar ones applied in the market for situations with similar characteristics and iii) exclude the
effect of factors that do not affect the future cash flows of the insurance contract.
In the subsequent valuation, the Statement of Financial Position shall include liabilities for insurance contracts,
divided into i) liabilities for future services and ii) liabilities for past services. In terms of the Income Statement, it
should include: i) income from insurance contracts, ii) expenses from insurance contracts and iii) losses from the
financial component of insurance contracts.
W3. Presentation and disclosures
In the Statement of Financial Position should appear in disaggregated form i) insurance contract assets, ii)
reinsurance ceded contract assets iii) insurance contracts liabilities and iv) reinsurance ceded contract liabilities.
In terms of the Income Statement, the following must be disclosed: i) income from insurance contracts, ii) expense
from insurance contracts, iii) losses from the financial component of insurance contracts, and iv) net result from
reinsurance contracts.
Together with the Financial Statements, the standard provides for additional qualitative and quantitative
disclosures of i) amounts recognised in the financial statements that fall within the scope of IFRS 17; ii) significant
judgements and changes to those judgements made with the application of IFRS 17 and iii) nature and extent of
the risks inherent in contracts that fall within the scope of IFRS 17.
For risks falling within the scope of IFRS 17, the entity shall analyse: (i) concentration risk, (ii) sensitivity analysis to
the most significant risks, (iii) claims development, (iv) credit risk and (v) liquidity risk.
X. Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorised by the Insurance and Pension Funds
Supervisory Authority (ASF - Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es) for the practice of the
activity of insurance mediation, in the category of tied Insurance Intermediary, in accordance with article 8(a)(i) of
Decree-Law no. 144/2006, of 31 July, developing the activity of insurance intermediation in the life and non-life
branches.
Within the scope of insurance mediation services, these Banks sell insurance contracts. As remuneration for the
services provided of insurance mediation, they receive commissions for the mediation of insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurers.
Commissions received by insurance mediation services are recognised in accordance with the accrual principle, so
that commissions received at a time other than the period to which it relates are recorded as receivables under
\"Other assets\". Commissions received for insurance mediation services are recognised in accordance with the
policy described in note I. Recognition of income from services and commissions.
Y. Accounting estimates and judgements in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgements and to make estimations when deciding which treatment is the most
appropriate. These estimates were made considering the best information available at the date of preparation of
the consolidated financial statements, considering the context of uncertainty that results from the current
economic scope and the global geopolitical conflicts. The most significant of these accounting estimates and
judgements used when applying accounting principles are discussed in this section to improve understanding of
how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different
treatment was chosen. The Executive Committee believes that the choices made are appropriate and that the
financial statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1. Entities included in the consolidation scope
For the purposes of determining entities to include in the consolidation scope, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession
of these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by
the Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is
exposed to the variable returns and its ability to use its power to affect these returns. Different estimations and
assumptions could lead the Group to a different scope of consolidation scope with a direct impact in consolidated
income.
Y2. Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is
compared with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying
amount of the business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested.
Determining the cash flows to discount and the discount rate, involves judgment.
Y3. Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax
determination is uncertain during the ordinary course of business. Different interpretations and estimations could
result in a different level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in
which the Group considers forecasts of future taxable income based on a set of assumptions, including the
estimate of income before taxes, adjustments to taxable income, evolution of tax legislation and its interpretation.
Thus, the recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors
strategy, namely the ability to generate the estimated taxable income, the evolution of tax law and its
interpretation.
Regarding the activity in Portugal, the Law no. 98/2019, of 4 September established the tax regime for credit
impairment and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
approximation between the accounting and tax rules for the purposes of deductibility of expenses with the
reinforcement of credit impairment. The rules in force until 2018 could continue to be applied until the end of the
2023 financial year, unless the option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis, recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and the impairment losses on debt instruments at amortised cost or at fair
value through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit,
with the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses
relating to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of
the Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
The Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still
not accepted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal no. 3/95, as amended before
its repeal by Notice of Banco de Portugal no. 5/2015, and, between other conditions, provided that they are not
credits covered by real estate rights.
Following the amendments provided for in Law no. 24-D/2022, of 30 December, within the scope of the State
Budget for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses went from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law no. 27-A/2020, of 24 July.
In the forecasts of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2025, the approximation between the accounting and tax rules
provided for in the aforementioned Law no. 98/2019, of 4 September, taking into account the option for applying
the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the use of
tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any tax losses deduction has
been made or tax credit has been used, in which the expiry period is the exercise of that right. The Group recorded
provisions, current tax liabilities or deferred taxes liabilities in the amount it considers appropriate to cover tax
corrections or tax losses incurred, as well as contingencies relating to years not yet reviewed by the tax authorities.
Y4. Valuation of real estate recorded in Non-current assets held for sale and in Other assets
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Group's historical experience in the commercialisation\u00a0 of real estate, its perspectives on the
evolution of the real estate market and the intentions of the management body regarding the commercialisation\u00a0
of these assets. The assumptions used in the valuations of these assets have an impact on their valuation and
consequently on the determination of impairment.
Y5. Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
forecasts, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
The discount rate used to update the Group's pension fund liabilities, regarding the defined benefit pension plans
of its employees and managers, was determined based on an analysis carried out on a set of available information,
which includes, among other elements, the market references for this indicator published by internationally
recognised specialised entities and which are based, as defined by IAS 19, on market yields of a universe of high
quality bond issues (low risk), different maturities, called in euro and relating to a diverse and representative range
of issuers (non-sovereign).
Y6. Financial instruments \u2013 IFRS 9
Y6.1. Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and
interest on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed
together to achieve a specific business objective. This evaluation requires judgement, since the following aspects,
among others, must be considered: the way in which the performance of assets is evaluated; the risks that affect
the performance of the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other
comprehensive income that are derecognised prior to their maturity to understand the underlying reasons for
their disposal and to determine whether they are consistent with the purpose of the business model defined for
these assets. This monitoring is part of a process of continuous evaluation by the Group of the business model of
the financial assets that remain in the portfolio, to determine if it is adequate and, if it is not, if there was a change
in the business model and, consequently, a prospective classification change of these financial assets.
Y6.2. Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3. Fair value of financial instruments
Fair value is determined based on market quotations when available, or, in their absence, on the prices of recent
similar transactions carried out under market conditions or through valuation methodologies supported by
discounted cash flow techniques, taking into consideration factors such as market conditions, the time value, the
yield curve, and volatility. When these methodologies involve the use of significant unobservable inputs or
assumptions, the instruments are classified as Level 3 in the fair value hierarchy, in accordance with applicable
accounting standards (IFRS 13). The use of different methodologies, assumptions, or judgements may result in
outcomes that differ from those reported.
In market environments characterised by higher macroeconomic uncertainty, the Group may, among other
measures, reallocate risk limits and review both stress scenarios and the calculation of fair value adjustments.
Y7. Provisions for legal risk related to foreign currency-indexed mortgage loans (mostly to
Swiss franc)
The Group creates provisions for legal contingencies related foreign currency-indexed mortgage loans, mostly to
Swiss franc granted by Bank Millennium, S.A.
The assumptions used by Bank Millennium are essentially based on historical observations and will have to be
updated in subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The
methodology developed by Bank Millennium is based on the following parameters: (i) the number of ongoing
cases (including class action agreements) and potential future lawsuits; (ii)\u00a0 the amount of potential loss for Bank
Millennium in the event of a specific court judgment (including the estimate of statutory interest which
dependents significantly on the period to which it relates (iii) estimates involving judicial or out-of-court
settlements reached with customers.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the Swiss franc and
the amount of the Bank Millennium\u2019s actual losses depend, namely, on the number of ongoing and potential
lawsuits, as well as on the final court decisions about each case and amicable settlement with customers,
concluded in court or out of court.
\u00a0 \u00a0 Z. Subsequent events
The Group analyses events occurred after the balance sheet date, i.e., favourable and/or unfavourable events that
occur between the balance sheet date and the date the financial statements were authorised for issue. In this
context, two types of events can be identified:
i) those that provide evidence of conditions that existed at the balance sheet date (events after the balance
sheet date that give rise to adjustments); and,
ii) those that are indicative of the conditions that arose after the balance sheet date (events after the balance
sheet date that do not give rise to adjustments).
Events occurred after the date of the financial statements that are not considered as adjustable events, if
significant, are disclosed in the notes to the consolidated financial statements.
", "dimensions": { "concept": "ifrs-full:DisclosureOfMaterialAccountingPolicyInformationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-563": { "value": "
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the
Bank and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the
years ended on 31 December 2025 and 2024.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002,
and Banco de Portugal Notice no. 5/2015 (which revoked Banco de Portugal Notice no. 1/2005), the Group\u2019s
consolidated financial statements are required to be prepared, since 2005, in accordance with International
Financial Reporting Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting
standards issued by the International Accounting Standards Board (IASB), as well as interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated
financial statements and the accompanying notes were approved on 25 March 2026 by the Bank's Board of
Directors and are presented in thousands of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2025 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in
Portuguese. In the event of discrepancies, the Portuguese version prevails.
", "dimensions": { "concept": "ifrs-full:DisclosureOfGeneralInformationAboutFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-564": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:DomicileOfEntity", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-565": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:CountryOfIncorporation", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-566": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:PrincipalPlaceOfBusiness", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-568": { "value": "
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002,
and Banco de Portugal Notice no. 5/2015 (which revoked Banco de Portugal Notice no. 1/2005), the Group\u2019s
consolidated financial statements are required to be prepared, since 2005, in accordance with International
Financial Reporting Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting
standards issued by the International Accounting Standards Board (IASB), as well as interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated
financial statements and the accompanying notes were approved on 25 March 2026 by the Bank's Board of
Directors and are presented in thousands of euros, rounded to the nearest thousand.
The Group's financial statements were prepared under the going concern assumption, the accrual-based
accounting regime and under the historical cost convention, as modified by the application of fair value for
derivative financial instruments, financial assets and liabilities at fair value through profit or loss and financial
assets at fair value through other comprehensive income. Financial assets and liabilities that are covered under
hedge accounting are stated at fair value in respect of the risk that is being hedged, if applicable. Other financial
assets and liabilities and non-financial assets and liabilities are stated at amortised cost or historical cost. Non-
current assets and disposal groups held for sale are stated at the lower of carrying amount or fair value less costs
to sell. Investment properties recognised on the Group's balance sheet are recognised at fair value.The liability for
defined benefit obligations is recognised as the present value of the past liabilities with pensions net of the value
of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice
of the Executive Committee, to make judgements, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and
associated assumptions are based on historical experience and other factors that are believed to be reasonable
under the circumstances and form the basis for making the judgements about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may differ from these estimations. The
issues involving a higher degree of judgment or complexity or for which assumptions and estimations are
significant are presented in note 1.Y.", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfPreparationOfFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-567": { "value": "
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002,
and Banco de Portugal Notice no. 5/2015 (which revoked Banco de Portugal Notice no. 1/2005), the Group\u2019s
consolidated financial statements are required to be prepared, since 2005, in accordance with International
Financial Reporting Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting
standards issued by the International Accounting Standards Board (IASB), as well as interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated
financial statements and the accompanying notes were approved on 25 March 2026 by the Bank's Board of
Directors and are presented in thousands of euros, rounded to the nearest thousand.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAuthorisationOfFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-569": { "value": "
The consolidated financial statements for the year ended on 31 December 2025 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1
January 2025. The accounting policies were applied consistently to all entities of the Group and are consistent with
those used in the preparation of the financial statements of the previous year.", "dimensions": { "concept": "ifrs-full:StatementOfIFRSCompliance", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-570": { "value": "
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1
January 2025. The accounting policies were applied consistently to all entities of the Group and are consistent with
those used in the preparation of the financial statements of the previous year.", "dimensions": { "concept": "ifrs-full:DisclosureOfReclassificationsOrChangesInPresentationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-571": { "value": "
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the
Bank and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1. Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group
controls an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or
has rights, to variable returns from its involvement with the entity and can take possession of these results
through the power it holds over the relevant activities of that entity (de facto control). The financial statements of
subsidiaries are included in the consolidated financial statements from the date on which control commences
until the date on which control ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the
Group can recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal
resulting in loss of control over a subsidiary, any participation retained is revalued at market value on the sale date
and the gain or loss resulting from this revaluation is booked against the income statement.
B2. Investments in associates
Investments in associates are recorded by the equity method from the date that the Group acquires significant
influence until the date it ceases to exist. Associates are those entities in which the Group has significant influence
but not control over the financial and operating policy decisions of the investee. It is assumed that the Group has
significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the
Group does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
- representation on the Board of Directors or equivalent governing body of the investee;
- participation in policy-making processes, including participation in decisions about dividends or other
distributions;
- material transactions between the Group and the investee;
- interchange of the management team;
- provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associates accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in the
associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3. Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair
value, determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly
attributable to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the
fair value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in
which the business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the
difference recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded
until the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a
year since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised
previously on the acquisition date, to reflect newly obtained information about facts and circumstances that
existed at the acquisition date and that, if they were known by then, would have impacted the measurement of
the amounts recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by
then, would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill recorded in the Group's asset is assessed annually in the
preparation of the accounts with reference to the end of the year or whenever there are indications of
eventual loss of value. Impairment losses are recognised in the income statement. The recoverable amount
is determined based on the higher of the asset value in use and the market value after deducting selling
costs, calculated using valuation methodologies supported by discounted cash flow techniques,
considering market conditions, the time value of money and the business risks.
B4. Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is
accounted as a transaction with shareholders and, therefore, no additional goodwill resulting from this
transaction is recognised. The difference between the acquisition cost and the fair value of non-controlling
interests acquired is recognised directly in reserves. On this basis, the gains and losses resulting from the
sale of controlling interests that do not impact the control position of a subsidiary are always recognised
against reserves.
B5. Loss of control
The gains or losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6. Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional
currency, defined as the currency of the primary economic environment in which they operate or the currency in
which the subsidiaries obtain their income or finance their activity. In the consolidation process, assets and
liabilities, including goodwill, of foreign subsidiaries are converted into euro at the official exchange rate on the
balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity
methods, exchange differences, between the conversion to euro of the equity at the beginning of the year and its
value in euro at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are
recognised against \u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that
are designated and qualified as hedging instruments related to foreign operations are recorded in equity under
\"Reserves and retained earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted
against profit and loss of the year.
The income and expenses of these subsidiaries are converted to euro at an approximate rate of the rates on the
dates of the transactions, using a monthly average considering the initial and final exchange rates of each month.
Exchange differences from the conversion to euro of the profits and losses for the reporting period, arising from
the difference between the exchange rate used in the income statement and the exchange rate prevailing at the
balance sheet date, are recognised in \"Reserves and retained earnings - exchange differences resulting from the
consolidation of Group's companies\". The exchange rates used by the Group are detailed in note 55.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to
the investment in the foreign operation and to the associated hedge transaction previously recognised in reserves
are transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities
that present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-
monetary assets and liabilities are adjusted based on the price index from the date of acquisition. The restated
values of assets are reduced by the amount that exceeds their recoverable amount, in accordance with the
applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associates, its effects are included in the
Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items
are recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy
until 31 December 2018. This classification is no longer applicable as at 1 January 2019.
B7. Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from
these transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains
and losses arising from transactions with associates and jointly controlled entities are eliminated in the proportion
of the Group's investment in these entities.
Entities included in the consolidation scope
For the purposes of determining entities to include in the consolidation scope, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession
of these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by
the Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is
exposed to the variable returns and its ability to use its power to affect these returns. Different estimations and
assumptions could lead the Group to a different scope of consolidation scope with a direct impact in consolidated
income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfConsolidationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-573": { "value": "Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group
controls an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or
has rights, to variable returns from its involvement with the entity and can take possession of these results
through the power it holds over the relevant activities of that entity (de facto control). The financial statements of
subsidiaries are included in the consolidated financial statements from the date on which control commences
until the date on which control ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the
Group can recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal
resulting in loss of control over a subsidiary, any participation retained is revalued at market value on the sale date
and the gain or loss resulting from this revaluation is booked against the income statement.
Loss of control
The gains or losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional
currency, defined as the currency of the primary economic environment in which they operate or the currency in
which the subsidiaries obtain their income or finance their activity. In the consolidation process, assets and
liabilities, including goodwill, of foreign subsidiaries are converted into euro at the official exchange rate on the
balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity
methods, exchange differences, between the conversion to euro of the equity at the beginning of the year and its
value in euro at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are
recognised against \u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that
are designated and qualified as hedging instruments related to foreign operations are recorded in equity under
\"Reserves and retained earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted
against profit and loss of the year.
The income and expenses of these subsidiaries are converted to euro at an approximate rate of the rates on the
dates of the transactions, using a monthly average considering the initial and final exchange rates of each month.
Exchange differences from the conversion to euro of the profits and losses for the reporting period, arising from
the difference between the exchange rate used in the income statement and the exchange rate prevailing at the
balance sheet date, are recognised in \"Reserves and retained earnings - exchange differences resulting from the
consolidation of Group's companies\". The exchange rates used by the Group are detailed in note 55.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to
the investment in the foreign operation and to the associated hedge transaction previously recognised in reserves
are transferred to profit and loss, as part of the gains or loss arising from the disposal.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSubsidiariesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-572": { "value": "Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group
controls an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or
has rights, to variable returns from its involvement with the entity and can take possession of these results
through the power it holds over the relevant activities of that entity (de facto control). The financial statements of
subsidiaries are included in the consolidated financial statements from the date on which control commences
until the date on which control ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the
Group can recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal
resulting in loss of control over a subsidiary, any participation retained is revalued at market value on the sale date
and the gain or loss resulting from this revaluation is booked against the income statement.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-575": { "value": "Investments in associates
Investments in associates are recorded by the equity method from the date that the Group acquires significant
influence until the date it ceases to exist. Associates are those entities in which the Group has significant influence
but not control over the financial and operating policy decisions of the investee. It is assumed that the Group has
significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the
Group does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
- representation on the Board of Directors or equivalent governing body of the investee;
- participation in policy-making processes, including participation in decisions about dividends or other
distributions;
- material transactions between the Group and the investee;
- interchange of the management team;
- provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associates accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in the
associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3. Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional
currency, defined as the currency of the primary economic environment in which they operate or the currency in
which the subsidiaries obtain their income or finance their activity. In the consolidation process, assets and
liabilities, including goodwill, of foreign subsidiaries are converted into euro at the official exchange rate on the
balance sheet date.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociates", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-574": { "value": "Investments in associates
Investments in associates are recorded by the equity method from the date that the Group acquires significant
influence until the date it ceases to exist. Associates are those entities in which the Group has significant influence
but not control over the financial and operating policy decisions of the investee. It is assumed that the Group has
significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the
Group does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
- representation on the Board of Directors or equivalent governing body of the investee;
- participation in policy-making processes, including participation in decisions about dividends or other
distributions;
- material transactions between the Group and the investee;
- interchange of the management team;
- provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associates accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in the
associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociatesAndJointVenturesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-577": { "value": "Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair
value, determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly
attributable to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the
fair value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in
which the business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the
difference recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded
until the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a
year since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised
previously on the acquisition date, to reflect newly obtained information about facts and circumstances that
existed at the acquisition date and that, if they were known by then, would have impacted the measurement of
the amounts recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by
then, would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill recorded in the Group's asset is assessed annually in the
preparation of the accounts with reference to the end of the year or whenever there are indications of
eventual loss of value. Impairment losses are recognised in the income statement. The recoverable amount
is determined based on the higher of the asset value in use and the market value after deducting selling
costs, calculated using valuation methodologies supported by discounted cash flow techniques,
considering market conditions, the time value of money and the business risks.
Intangible assets
N1. Research and development expenditure
The Group does not capitalise any research and development costs. All expenses are recognised as costs in the
period in which they occur.
N2. Software
The Group recognises as intangible assets the costs associated to software acquired from external entities and
depreciates them on a straight-line basis by an estimated lifetime of 6 years. The Group does not capitalise
internal costs arising from software development.
Whenever there is an indication that an intangible fixed asset may be impaired, an estimate of its recoverable
amount is made, and an impairment loss should be recognised whenever the net value of that asset exceeds its
recoverable amount. The recoverable amount is determined as the higher of its fair value less costs to sell and its
value in use, which is calculated based on the present value of the estimated future cash flows expected to be
obtained from the continued use of the asset and its disposal at the end of its useful life. Impairment losses on
intangible fixed assets are recognised in profit or loss for the period.
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is
compared with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying
amount of the business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested.
Determining the cash flows to discount and the discount rate, involves judgment.
Y3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-576": { "value": "Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair
value, determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly
attributable to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the
fair value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in
which the business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the
difference recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded
until the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a
year since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised
previously on the acquisition date, to reflect newly obtained information about facts and circumstances that
existed at the acquisition date and that, if they were known by then, would have impacted the measurement of
the amounts recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by
then, would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill recorded in the Group's asset is assessed annually in the
preparation of the accounts with reference to the end of the year or whenever there are indications of
eventual loss of value. Impairment losses are recognised in the income statement. The recoverable amount
is determined based on the higher of the asset value in use and the market value after deducting selling
costs, calculated using valuation methodologies supported by discounted cash flow techniques,
considering market conditions, the time value of money and the business risks.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-578": { "value": "
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair
value, determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly
attributable to the acquisition of a subsidiary are recorded directly in the income statement.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded
until the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a
year since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised
previously on the acquisition date, to reflect newly obtained information about facts and circumstances that
existed at the acquisition date and that, if they were known by then, would have impacted the measurement of
the amounts recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by
then, would have resulted in the recognition of those assets and liabilities at that time.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-579": { "value": "
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the
fair value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in
which the business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the
difference recorded in the income statement or in equity, when applicable.
The recoverable amount of the goodwill recorded in the Group's asset is assessed annually in the
preparation of the accounts with reference to the end of the year or whenever there are indications of
eventual loss of value. Impairment losses are recognised in the income statement. The recoverable amount
is determined based on the higher of the asset value in use and the market value after deducting selling
costs, calculated using valuation methodologies supported by discounted cash flow techniques,
considering market conditions, the time value of money and the business risks.
Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is
compared with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying
amount of the business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested.
Determining the cash flows to discount and the discount rate, involves judgment.
Y3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-580": { "value": "Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is
accounted as a transaction with shareholders and, therefore, no additional goodwill resulting from this
transaction is recognised. The difference between the acquisition cost and the fair value of non-controlling
interests acquired is recognised directly in reserves. On this basis, the gains and losses resulting from the
sale of controlling interests that do not impact the control position of a subsidiary are always recognised
against reserves.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithNoncontrollingInterestsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-581": { "value": "Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional
currency, defined as the currency of the primary economic environment in which they operate or the currency in
which the subsidiaries obtain their income or finance their activity. In the consolidation process, assets and
liabilities, including goodwill, of foreign subsidiaries are converted into euro at the official exchange rate on the
balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity
methods, exchange differences, between the conversion to euro of the equity at the beginning of the year and its
value in euro at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are
recognised against \u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that
are designated and qualified as hedging instruments related to foreign operations are recorded in equity under
\"Reserves and retained earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted
against profit and loss of the year.
The income and expenses of these subsidiaries are converted to euro at an approximate rate of the rates on the
dates of the transactions, using a monthly average considering the initial and final exchange rates of each month.
Exchange differences from the conversion to euro of the profits and losses for the reporting period, arising from
the difference between the exchange rate used in the income statement and the exchange rate prevailing at the
balance sheet date, are recognised in \"Reserves and retained earnings - exchange differences resulting from the
consolidation of Group's companies\". The exchange rates used by the Group are detailed in note 55.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to
the investment in the foreign operation and to the associated hedge transaction previously recognised in reserves
are transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities
that present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-
monetary assets and liabilities are adjusted based on the price index from the date of acquisition. The restated
values of assets are reduced by the amount that exceeds their recoverable amount, in accordance with the
applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associates, its effects are included in the
Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items
are recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy
until 31 December 2018. This classification is no longer applicable as at 1 January 2019.
Transactions in foreign currencies are converted into the respective functional currency of the operation at the
foreign exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are converted into the respective functional currency of the operation at the foreign exchange rate on
the reporting date. Foreign exchange differences arising from conversion are recognised in the income statement.
Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are
converted into the respective functional currency of the operation at the foreign exchange rate on the date of the
transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are
converted into the respective functional currency of the operation at the foreign exchange rate on the date that
the fair value was determined against profit and loss, except for financial assets at fair value through other
comprehensive income, for which the difference is recognised against equity.
R.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFunctionalCurrencyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-582": { "value": "
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities
that present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-
monetary assets and liabilities are adjusted based on the price index from the date of acquisition. The restated
values of assets are reduced by the amount that exceeds their recoverable amount, in accordance with the
applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associates, its effects are included in the
Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items
are recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy
until 31 December 2018. This classification is no longer applicable as at 1 January 2019.
Share of profit of associates accounted for using the equity method
The main contributions of the investments accounted for using the equity method are analysed as follows:
(Thousands of euros)
2025
2024
Banco Millennium Atl\u00e2ntico, S.A. (note 26)
Appropriation of net income relating to the current year
4,954
4,101
Effect of the application of IAS 29:
Amortisation of the effect calculated until 31 December 2018 (a)
(104)
(182)
4,850
3,919
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
36,144
28,360
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
7,709
5,373
SIBS, S.G.P.S, S.A.
13,709
15,385
Banque BCP, S.A.S.
3,266
2,995
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
1,550
1,546
Other companies
(5,045)
1,310
57,333
54,969
62,183
58,888
(a) Based on the requirements of IAS 29, Angola was considered as a hyperinflationary economy until 31 December 2018, for the purposes of
presentation of consolidated financial statements, as described in accounting policy 1 B6. This classification is no longer applied since 1 January 2019.", "dimensions": { "concept": "ifrs-full:DisclosureOfHyperinflationaryReportingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-584": { "value": "Financial instruments (IFRS 9)
C1. Financial assets
C1.1. Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013 \u201cFinancial assets at amortised cost\u201d;
\u2013 \u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013 \u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013 the Group's business model for the management of the financial asset; and,
\u2013 the characteristics of the contractual cash flows of the financial asset.
In the initial determination of fair value, if it is not based on observable market data for the financial instruments
under analysis, the difference (when materially relevant) between the transaction price and the fair value (day 1
P&L) should not be immediately recognised in profit or loss. It should be deferred and recognised as a gain or loss
only when the unobservable inputs become observable, or as the entity completes the transaction.
Business Model Evaluation
The Group, at the time of acquisition of financial instruments, carried out an evaluation of the business model in
which the\u00a0 are held at portfolio level, since this approach reflects how assets are managed and how that
information is made available to management bodies. The information considered in this evaluation included:
\u2013 the policies and purposes established for the portfolio and the practical operability of these policies, including
how the management strategy focuses on receiving contractual interest, maintaining a certain interest rate
profile, adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the
realisation of cash flows through the sale of the assets;
\u2013 how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013 the evaluation of the risks that affect the performance of the business model (and of the financial assets held
under this business model) and the way these risks are managed;
\u2013 the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the
assets under management or on contractual cash flows received; and,
\u2013 the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the
expectations about future sales. However, sales information should not be considered individually, but as part
of an overall assessment of how the Group establishes financial asset management objectives and how cash
flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured
at fair value through profit or loss because they are not held either for the collection of contractual cash flows
(HTC), nor for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial
recognition. \"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with
the amount owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk
and administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation
included the analysis of the existence of situations in which the contractual terms can modify the periodicity and
the amount of the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group
considered:
\u2013 contingent events that may change the periodicity and the amount of the cash flows;
\u2013 characteristics that result in leverage;
\u2013 terms of prepayment and extension of maturity;
\u2013 terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013 characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013 the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal
value;
\u2013 the prepayment represents substantially the nominal amount of the contract plus accrued contractual
interest, but not paid (may include reasonable compensation for prepayment); and,
\u2013 the prepaid fair value is insignificant at initial recognition.
C1.1.1. Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following
conditions are met:
\u2013 the financial asset is held within a business model whose objective is to hold financial assets in order to collect
their contractual cash flows; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and
advances to customers and debt instruments managed based on a business model whose purpose is to receive
their contractual cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the
funds are made available to the counterparty (settlement date). Debt instruments are recognised on the trade
date, that is, on the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the
effective interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are recorded in \"Gains/(losses) arising from derecognition
of financial assets and liabilities not measured at fair value through profit or loss\".
C1.1.2. Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive
income\" if both of the following conditions are met:
\u2013 the financial asset is held within a business model whose objective is both to collect its contractual cash flows
and to sell this financial asset; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent
retribution recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may
irrevocably choose to classify it in the category of \"Financial assets at fair value through other comprehensive
income\" (FVOCI). This option is exercised on a case-by-case basis and is only available for financial instruments
that comply with the definition of equity instruments provided in IAS 32 and cannot be used for financial
instruments whose classification as an equity instrument under the scope of the issuer is made under the
exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
C1.1.3. Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2. Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management
has changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including
the ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other
comprehensive income is not allowed, nor of financial instruments designated at fair value through profit or
loss.
C1.3. Modification and derecognition of financial assets
General principles
i) The Group shall derecognise a financial asset when, and only when:
\u2013 the contractual rights to the cash flows from the financial asset expire; or,
\u2013 it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii) The Group transfers a financial asset if, and only if, it either:
\u2013 transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013 retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual
obligation to pay the cash flows to one or more recipients in an arrangement that meets the conditions
presented in note iii).
iii) When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'),
but assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'),
the Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are
met:
\u2013 the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013 the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013 the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without
material delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash
equivalents (as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the
collection date until the date of required remittance to the eventual recipients, and interest earned on such
investments is passed to the eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and rewards arising from owning the financial asset. In this case:
\u2013 if the Group transfers substantially all the risks and rewards arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013 if the Group retains substantially all the risks and rewards arising from owning the financial asset, it shall
continue to recognise the financial asset;
\u2013 if the Group neither transfers nor retains substantially all the risks and rewards arising from owning the
financial asset, it shall determine whether it retained control of the financial asset. In this case:
a) if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as
assets or liabilities, any rights and obligations created or retained in the transfer;
b) if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and rewards (see prior note) is evaluated by comparing the Group\u2019s exposure, before and
after the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset
depends on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in
its entirety to an unrelated third party and can exercise that ability unilaterally without needing to impose
additional restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained
control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of
new ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that
may lead to the derecognition of a financial asset.
The Group considers that a modification of the terms and conditions of a credit exposure will result in
derecognition of the transaction and in recognition of a new transaction when the modification translates into at
least one of the following conditions:
\u2013 Creation of a new exposure that results from a debt consolidation, without any of the derecognised instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013 Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to
the residual maturity in the moment of the modification;
\u2013 Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013 Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or
managed within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on
the financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv
of the above paragraphs should be checked (the other criteria listed in this paragraph are not relevant in such
situations).
Under the regulatory changes that occurred in Poland and the negotiations with customers holding mortgage
loans in foreign currency described in note 58, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a
given asset is not derecognised, the Group adjusts the gross book value of the financial asset and recognises the
profit or loss due to the modification in the Income Statement - Results on modification. The adjustment to the
gross carrying amount of a financial asset is the difference between the discounted cash flows before and after
contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its
entirety or partially. Loan recoveries and loans written off are recorded under the Impairment of financial assets at
amortised cost and in off-balance sheet accounts, respectively.
C1.4. Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit
impairment in the moment of their initial recognition. An asset is credit-impaired if one or more events have
occurred with a negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013 financial assets arising from a recovery process, where there have been changes to the terms and conditions of
the original agreement, which presented objective evidence of impairment that resulted in its derecognition
(note C1.3) and recognition of a new contract that reflects the credit losses incurred;
\u2013 financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses
(ECL) are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition,
the gross book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value
before being recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5. Impairment losses
C1.5.1. Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the
following accounting items:
C1.5.1.1. Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets
against the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2. Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\",
against other comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3. Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are
recognised in liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other
provisions\" (in the income statement).
C1.5.2. Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk
since its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013 Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to
expected credit losses resulting from a default event that may occur within 12 months after the reporting date
(12-month expected credit losses);
\u2013 Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note
C1.5.3) but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with
operations classified in this stage correspond to the expected credit losses resulting from default events that
may occur over the expected residual life of the operations (lifetime expected credit losses);
\u2013 Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified
at this stage correspond to lifetime expected credit losses.
C1.5.3. Significant increase in credit risk (SICR)
The Group uses a set of criteria to determine whether there is a significant increase in the Probability of Default
(PD) (Significant increase in Credit Risk) associated with credit exposures, which leads to a stage 2 classification.
Among the criteria considered by the Group, the following are noteworthy:
(i) customers classified with procedural risk grade 123 or 124, due to material arrears of more than 30 days or being
monitored by credit recovery, or with no assigned risk grade;
(ii) customers with a deterioration of the risk grade on the internal scale, above pre-defined thresholds, between
the initial recognition date of the contract and the impairment calculation date;
(iii) relative change in the cumulative Probability of Default (PD) for the remaining maturity of the exposure
(Lifetime Forward-looking PD) above a certain threshold;
(iv) exposures whose absolute value of the 12-month Forward-looking PD at the reporting date exceeds a certain
threshold;
(v) customers with operations restructured due to financial difficulties;
(vi) customers with incidents reported through the Banco de Portugal's Central Credit Register; and
(vii) customers subject to individual analysis for whom a stage 2 classification has been concluded due to the
occurrence of a significant increase in credit risk, taking into account a set of predetermined indicators for this
purpose.
Exposures that no longer meet the criteria to be classified as stage 2 are classified as stage 1.
C1.5.4. Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than EUR 100 (retail) or more than EUR 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in
which the customer is in this situation have been counted, it is classified as default.
The existence of a material payment delay gives rise to the default setting of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i. Credit restructuring due to financial difficulties with loss of value;
ii. Delay after restructuring due to financial difficulties;
iii. Recurrence of restructuring due to financial difficulties;
iv. Credit with signs of impairment (or stage 3 of IFRS 9);
v. Insolvency or equivalent proceedings;
vi. Litigation;
vii. Guarantees of operations in default;
viii. Credit sales with losses;
ix. Credit fraud;
x. Unpaid credit status;
xi. Breach of covenants in a credit agreement;
xii. Spread of default in an economic group;
xiii. Cross default in BCP Group.
C1.5.5. Estimates of expected credit losses - Individual analysis
1. Customers who are in one of the following conditions are subject to individual analysis:
Customers in
default
Customers in litigation or insolvency, if the total exposure of the group members in these
situations exceeds EUR 1 million
Customers integrated into groups with an exposure over EUR 5 million, if they have a risk grade 125
Groups or
customers who are
not in default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over EUR 5 million, if a group member has a risk grade 124
or has a restructured loan and a risk grade 123\u00a0
Groups or customers with an exposure over EUR 10 million, if at least one member of the group is
in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds EUR 25
million
2. Regardless of the criteria described in the previous point, the individual analysis is only performed for customers
with a credit exposure over EUR 500,000, while customers with exposure below this limit are not considered
for the purpose of determining the exposure referred to in the previous point.
3. Other customers that do not meet the criteria defined in 1 will also be subject to individual analysis, if under the
following conditions:
\u2013 they have impairment as a result of the latest individual analysis;
\u2013 are classified in stage 2 as a result of the latest revision of the questionnaire analysing the signs of financial
difficulties;
\u2013 according to recent information, they show a significant deterioration in risk levels.
4. The individual analysis includes the following procedures:
\u2013 for customers that are not in default, the analysis of financial difficulties indicators to determine whether the
customer has objective signs of impairment, or whether it should be classified in stage 2 given the occurrence
of a significant increase in credit risk, considering for this purpose a set of predetermined signs;
\u2013 for customers in default or for which the previous analysis has allowed to conclude that the customer has
objective signs of impairment, determination of the loss.
5. For the situations identified in the first paragraph of point 4 above, involving corporate customers, the analysis
is the responsibility of the Rating Division, and the responsibility of the Credit Division for the remaining
customers.
6. For the situations identified in the second paragraph of point 4 above, the individual analysis to determine the
loss is the responsibility of the customer's management divisions and of the Credit Division, the latter with
regard to the customers managed by the Commercial Networks.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the
total credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed
at each balance sheet date the existence of objective evidence of impairment. In the assessment of impairment
losses in individual terms, the following factors were considered:
\u2013 total exposure of each customer towards the Group and the existence of overdue loans;
\u2013 viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations
in the future;
\u2013 the existence, nature and estimated value of the collaterals associated to each loan;
\u2013 the customer\u2019s available assets in liquidation or insolvency situations and the existence of preferential creditors;
\u2013 the amount and expected recovery term.
7. Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery
period to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk
Office as part of the regular process of collecting information, accompanied by detailed justification of the
proposed impairment.
8. The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be
a weighted rate considering the different recovery prospects for each part of the customer's liabilities.
9. The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualised perspective, the latter when cases that, due to their specificity, have
a high degree of uncertainty regarding the expected recovery estimation are identified.
10. The macroeconomic adjustment set out in previous point should be analysed annually and weighted
according to the type of recovery strategy associated with the exposure under analysis:
\u2013 for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global
way, to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one
scenario;
\u2013 for Gone Concern strategies (i.e., the recovery estimation is based on the realisation of the collateral), the
impact of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the
projected real estate index indicates significant changes ahead for the current valuation values.
11. It is the responsibility of the units referred to in points 5 and 6 to consider in their forecast macroeconomic
expectations that may influence the recoverability of the debt.
12. For the purposes of the preceding paragraphs, the Group's Economic Studies Area shall disclose the
macroeconomic data that allow the estimations to be made.
13. The decision to consider global impacts related to the going and gone concern scenarios should be made by
the Risk Committee, as proposed by the Risk Office.
14. For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be
considered casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013 recovery of collateral in geographies in which the Group has no relevant recovery experience;
\u2013 recovery of debt related to geographies in which there is strong political instability;
\u2013 recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013 recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013 recovery of debt related to debtors for whom there is a strong negative public exposure.
15. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
16. Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 115 of the Master Scale.
17. The individual analysis must be carried out annually and may be carried out more frequently for customers
who fall into certain situations of possible increased risk. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to
promote the early review of the individual analysis of this customer.
C1.5.6. Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis for the determination of loss are grouped
considering their risk characteristics and subject to a collective impairment analysis. The Group's credit portfolio is
divided by internal risk grades and according to the following segments:
a) Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project
finance, Institutions (banks/financial institutions), Sovereigns and Real estate development;
b) Segments not \u2018low default\u2019:
- Retail: Mortgage, Consumer and Small and medium-sized enterprises - Retail;
- Corporate: Small and medium enterprises - Corporate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013 financial assets with no signs of impairment at the reporting date: the present value of the difference between
the contractual cash flows and the cash flows that the Group expects to receive;
\u2013 financial assets with impairment at the reporting date: the difference between the gross book value and the
present value of the estimated cash flows;
\u2013 unused credit commitments: the present value of the difference between the resulting contractual cash flows
if the commitment is made and the cash flows that the Group expects to receive;
\u2013 financial guarantees: the current value of the expected repayments less the amounts that the Group expects
to recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013 Probability of Default \u2013 PD;
\u2013 Loss Given Default \u2013 LGD; and,
\u2013 Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering
the already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These
models are based on internal data including both quantitative and qualitative factors. If there is a change in the
risk of the counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated
considering the contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates
the LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models
consider the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs.
In the case of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of
high relevance in the determination of LGD, considering the applicable haircuts as well as the estimated time and
associated selling costs.
In the case of exposures from the securities portfolio of issuers that are Banks or Sovereigns, or subordinated
exposures, the LGD to be applied in the credit loss estimate considers the LGD defined for the purpose of
calculating capital requirements (CRR).
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD
values from the counterparty's current exposure and potential changes to its current value as a result of the
contractual conditions, including amortisations and prepayments. For commitments and financial guarantees, the
value of the EAD will consider both the amount of credit used and the expectation of future potential value that
may be used in accordance with the agreement.
For exposures covered by guarantees issued by Mutual Guarantee Societies or by supranational entities, the Bank
applies the PD and LGD parameters associated with these entities to the covered part of the EAD.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a
longer period. The maximum contractual period shall be considered as the period up to the date on which the
Group has the right to require payment or end the commitment or guarantee.
The Group conservatively considers a residual term of 5 years in the case of renewable operations, when in stage 2.
This term was determined based on the behavioural models associated with this type of product.
Incorporation of forward-looking information:
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-
looking information is carried out in the relevant elements considered for the calculation of expected credit losses
(ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing
exposures at the reference date becoming defaulted exposures considers the expected values for a set of
macroeconomic variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the
Group's Economic Studies area. These scenarios, which are used across the Group for various purposes besides
calculating impairment, consider existing forecasts by reference entities.
In December 2025, the Group carried out an update of the macroeconomic scenarios and of the corresponded
adjustment of the parameters considered in the collective impairment model.
It should be noted that, in 2025, the Group revised its IFRS 9 impairment models, focusing on alignment with the
IRB models, which were revised in 2024. This revision covered the criteria for identifying a significant increase in
credit risk \u2013 SICR (stage 2) and the models for estimating PD, LGD, EAD, and calculating ECL, addressing all
relevant components, such as historical information, segmentation, forward-looking adjustments, as well as the
review of the monitoring and backtesting framework
Securitisation operations
D1. Traditional securitisations
As at 31 December 2025, Banco Comercial Portugu\u00eas held two residential mortgage securitisation operations in
Portugal: Magellan Mortgages no.3 and no.4. Initially, the portfolios of these operations were derecognised from
the Bank\u2019s individual balance sheet, as the risks and rewards related to the residual portions of the referred
transactions, were transferred to institutional investors.
By purchasing a part or all of the most subordinated residual portion, the Group maintained control of the assets
and liabilities of Magellan Mortgages no.3, this Special Purpose Entity (SPE) being consolidated in the Group\u2019s
financial statements, in accordance with the accounting policy described in note 1 B.
The two operations are traditional securitisations, where each mortgage loan portfolio was sold to a Portuguese
Loan Securitisation Fund, which has financed this purchase through the sale of securitisation units to an Irish-SPE.
At the same time, this Special Purpose Entity (SPE) issued and sold in capital markets the different tranches of
bonds.
D2. Synthetic securitisations
As at 31 December 2025, Banco Comercial Portugu\u00eas held in Portugal two synthetic securitisation operations, with
similar characteristics, with reference to credit portfolios granted by the Bank mainly to Small and Medium
Enterprises (SMEs).
The operations currently underway are as follows:
\u2013 Caravela SME no.5, initiated on 20 December 2022, is supported by a diversified portfolio of medium-and-
long-term loans, leasing contracts and commercial paper programmes.
\u2013 Caravela SME no.6, initiated on 28 February 2024, is supported on a credit portfolio of short-term exposures to
Corporate customers, including current accounts overdrafts, authorised overdrafts and confirming
agreements.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitisations, under CDS, the
risk of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity.
The full amount of the mezzanine was placed on the market, with the Bank retaining the risk inherent of the full
amount of the senior and equity tranches.
It should also be noted that in both transactions, the product of the CLNs issue was invested by the SPE in a
deposit, which fully collateralises the responsibilities in the presence of its creditors including BCP in accordance
with the CDS.
Within the scope of the active management of its synthetic securitisation structures, the Bank exercised the
termination options provided for in the contracts relating to Caravela SME No. 4 and Caravela SME No. 3, whose
respective Credit Default Swap (CDS) contracts were terminated on 22 December 2025 and 30 December 2025,
respectively (as described in note 22).
Securities borrowing and repurchase agreement transactions
F1. Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are
measured in accordance with the applicable accounting policy. Cash collateral received in respect of securities
lent is recognised as a financial liability. Securities borrowed under securities borrowing agreements are not
recognised. Cash collateral placements in respect of securities borrowed are recognised under loans and advances
to either banks or customers. Income and expenses arising from the securities borrowing and lending business
are recognised on an accrual basis over the period of the transactions and are included in interest income or
expense (net interest income).
F2. Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities
substantially equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to
reselling agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in
loans and advances to customers or loans and advances to credit institutions. The receivables are collateralised by
the related securities. Securities sold through repurchase agreements continue to be recognised in the balance
sheet and are revaluated in accordance with the applicable accounting policy. The amounts received from the
proceeds of these securities are considered as Deposits from customers and other funds or Deposits from credit
institutions and other funds. The difference between the acquisition/sale and reselling/repurchase conditions is
recognised on an accrual basis over the period of the transaction and is included in interest income or expenses.
Financial instruments \u2013 IFRS 9
Y6.1. Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and
interest on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed
together to achieve a specific business objective. This evaluation requires judgement, since the following aspects,
among others, must be considered: the way in which the performance of assets is evaluated; the risks that affect
the performance of the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other
comprehensive income that are derecognised prior to their maturity to understand the underlying reasons for
their disposal and to determine whether they are consistent with the purpose of the business model defined for
these assets. This monitoring is part of a process of continuous evaluation by the Group of the business model of
the financial assets that remain in the portfolio, to determine if it is adequate and, if it is not, if there was a change
in the business model and, consequently, a prospective classification change of these financial assets.
Y6.2. Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3. Fair value of financial instruments
Fair value is determined based on market quotations when available, or, in their absence, on the prices of recent
similar transactions carried out under market conditions or through valuation methodologies supported by
discounted cash flow techniques, taking into consideration factors such as market conditions, the time value, the
yield curve, and volatility. When these methodologies involve the use of significant unobservable inputs or
assumptions, the instruments are classified as Level 3 in the fair value hierarchy, in accordance with applicable
accounting standards (IFRS 13). The use of different methodologies, assumptions, or judgements may result in
outcomes that differ from those reported.
In market environments characterised by higher macroeconomic uncertainty, the Group may, among other
measures, reallocate risk limits and review both stress scenarios and the calculation of fair value adjustments.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-583": { "value": "Financial instruments (IFRS 9)
C1. Financial assets
C1.1. Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013 \u201cFinancial assets at amortised cost\u201d;
\u2013 \u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013 \u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013 the Group's business model for the management of the financial asset; and,
\u2013 the characteristics of the contractual cash flows of the financial asset.
In the initial determination of fair value, if it is not based on observable market data for the financial instruments
under analysis, the difference (when materially relevant) between the transaction price and the fair value (day 1
P&L) should not be immediately recognised in profit or loss. It should be deferred and recognised as a gain or loss
only when the unobservable inputs become observable, or as the entity completes the transaction.
Business Model Evaluation
The Group, at the time of acquisition of financial instruments, carried out an evaluation of the business model in
which the\u00a0 are held at portfolio level, since this approach reflects how assets are managed and how that
information is made available to management bodies. The information considered in this evaluation included:
\u2013 the policies and purposes established for the portfolio and the practical operability of these policies, including
how the management strategy focuses on receiving contractual interest, maintaining a certain interest rate
profile, adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the
realisation of cash flows through the sale of the assets;
\u2013 how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013 the evaluation of the risks that affect the performance of the business model (and of the financial assets held
under this business model) and the way these risks are managed;
\u2013 the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the
assets under management or on contractual cash flows received; and,
\u2013 the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the
expectations about future sales. However, sales information should not be considered individually, but as part
of an overall assessment of how the Group establishes financial asset management objectives and how cash
flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured
at fair value through profit or loss because they are not held either for the collection of contractual cash flows
(HTC), nor for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial
recognition. \"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with
the amount owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk
and administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation
included the analysis of the existence of situations in which the contractual terms can modify the periodicity and
the amount of the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group
considered:
\u2013 contingent events that may change the periodicity and the amount of the cash flows;
\u2013 characteristics that result in leverage;
\u2013 terms of prepayment and extension of maturity;
\u2013 terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013 characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013 the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal
value;
\u2013 the prepayment represents substantially the nominal amount of the contract plus accrued contractual
interest, but not paid (may include reasonable compensation for prepayment); and,
\u2013 the prepaid fair value is insignificant at initial recognition.
C1.1.1. Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following
conditions are met:
\u2013 the financial asset is held within a business model whose objective is to hold financial assets in order to collect
their contractual cash flows; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and
advances to customers and debt instruments managed based on a business model whose purpose is to receive
their contractual cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the
funds are made available to the counterparty (settlement date). Debt instruments are recognised on the trade
date, that is, on the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the
effective interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are recorded in \"Gains/(losses) arising from derecognition
of financial assets and liabilities not measured at fair value through profit or loss\".
C1.1.2. Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive
income\" if both of the following conditions are met:
\u2013 the financial asset is held within a business model whose objective is both to collect its contractual cash flows
and to sell this financial asset; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent
retribution recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may
irrevocably choose to classify it in the category of \"Financial assets at fair value through other comprehensive
income\" (FVOCI). This option is exercised on a case-by-case basis and is only available for financial instruments
that comply with the definition of equity instruments provided in IAS 32 and cannot be used for financial
instruments whose classification as an equity instrument under the scope of the issuer is made under the
exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
C1.1.3. Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2. Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management
has changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including
the ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other
comprehensive income is not allowed, nor of financial instruments designated at fair value through profit or
loss.
C1.3. Modification and derecognition of financial assets
General principles
i) The Group shall derecognise a financial asset when, and only when:
\u2013 the contractual rights to the cash flows from the financial asset expire; or,
\u2013 it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii) The Group transfers a financial asset if, and only if, it either:
\u2013 transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013 retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual
obligation to pay the cash flows to one or more recipients in an arrangement that meets the conditions
presented in note iii).
iii) When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'),
but assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'),
the Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are
met:
\u2013 the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013 the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013 the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without
material delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash
equivalents (as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the
collection date until the date of required remittance to the eventual recipients, and interest earned on such
investments is passed to the eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and rewards arising from owning the financial asset. In this case:
\u2013 if the Group transfers substantially all the risks and rewards arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013 if the Group retains substantially all the risks and rewards arising from owning the financial asset, it shall
continue to recognise the financial asset;
\u2013 if the Group neither transfers nor retains substantially all the risks and rewards arising from owning the
financial asset, it shall determine whether it retained control of the financial asset. In this case:
a) if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as
assets or liabilities, any rights and obligations created or retained in the transfer;
b) if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and rewards (see prior note) is evaluated by comparing the Group\u2019s exposure, before and
after the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset
depends on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in
its entirety to an unrelated third party and can exercise that ability unilaterally without needing to impose
additional restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained
control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of
new ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that
may lead to the derecognition of a financial asset.
The Group considers that a modification of the terms and conditions of a credit exposure will result in
derecognition of the transaction and in recognition of a new transaction when the modification translates into at
least one of the following conditions:
\u2013 Creation of a new exposure that results from a debt consolidation, without any of the derecognised instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013 Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to
the residual maturity in the moment of the modification;
\u2013 Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013 Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or
managed within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on
the financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv
of the above paragraphs should be checked (the other criteria listed in this paragraph are not relevant in such
situations).
Under the regulatory changes that occurred in Poland and the negotiations with customers holding mortgage
loans in foreign currency described in note 58, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a
given asset is not derecognised, the Group adjusts the gross book value of the financial asset and recognises the
profit or loss due to the modification in the Income Statement - Results on modification. The adjustment to the
gross carrying amount of a financial asset is the difference between the discounted cash flows before and after
contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its
entirety or partially. Loan recoveries and loans written off are recorded under the Impairment of financial assets at
amortised cost and in off-balance sheet accounts, respectively.
C1.4. Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit
impairment in the moment of their initial recognition. An asset is credit-impaired if one or more events have
occurred with a negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013 financial assets arising from a recovery process, where there have been changes to the terms and conditions of
the original agreement, which presented objective evidence of impairment that resulted in its derecognition
(note C1.3) and recognition of a new contract that reflects the credit losses incurred;
\u2013 financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses
(ECL) are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition,
the gross book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value
before being recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5. Impairment losses
C1.5.1. Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the
following accounting items:
C1.5.1.1. Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets
against the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2. Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\",
against other comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3. Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are
recognised in liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other
provisions\" (in the income statement).
C1.5.2. Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk
since its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013 Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to
expected credit losses resulting from a default event that may occur within 12 months after the reporting date
(12-month expected credit losses);
\u2013 Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note
C1.5.3) but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with
operations classified in this stage correspond to the expected credit losses resulting from default events that
may occur over the expected residual life of the operations (lifetime expected credit losses);
\u2013 Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified
at this stage correspond to lifetime expected credit losses.
C1.5.3. Significant increase in credit risk (SICR)
The Group uses a set of criteria to determine whether there is a significant increase in the Probability of Default
(PD) (Significant increase in Credit Risk) associated with credit exposures, which leads to a stage 2 classification.
Among the criteria considered by the Group, the following are noteworthy:
(i) customers classified with procedural risk grade 123 or 124, due to material arrears of more than 30 days or being
monitored by credit recovery, or with no assigned risk grade;
(ii) customers with a deterioration of the risk grade on the internal scale, above pre-defined thresholds, between
the initial recognition date of the contract and the impairment calculation date;
(iii) relative change in the cumulative Probability of Default (PD) for the remaining maturity of the exposure
(Lifetime Forward-looking PD) above a certain threshold;
(iv) exposures whose absolute value of the 12-month Forward-looking PD at the reporting date exceeds a certain
threshold;
(v) customers with operations restructured due to financial difficulties;
(vi) customers with incidents reported through the Banco de Portugal's Central Credit Register; and
(vii) customers subject to individual analysis for whom a stage 2 classification has been concluded due to the
occurrence of a significant increase in credit risk, taking into account a set of predetermined indicators for this
purpose.
Exposures that no longer meet the criteria to be classified as stage 2 are classified as stage 1.
C1.5.4. Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than EUR 100 (retail) or more than EUR 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in
which the customer is in this situation have been counted, it is classified as default.
The existence of a material payment delay gives rise to the default setting of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i. Credit restructuring due to financial difficulties with loss of value;
ii. Delay after restructuring due to financial difficulties;
iii. Recurrence of restructuring due to financial difficulties;
iv. Credit with signs of impairment (or stage 3 of IFRS 9);
v. Insolvency or equivalent proceedings;
vi. Litigation;
vii. Guarantees of operations in default;
viii. Credit sales with losses;
ix. Credit fraud;
x. Unpaid credit status;
xi. Breach of covenants in a credit agreement;
xii. Spread of default in an economic group;
xiii. Cross default in BCP Group.
C1.5.5. Estimates of expected credit losses - Individual analysis
1. Customers who are in one of the following conditions are subject to individual analysis:
Customers in
default
Customers in litigation or insolvency, if the total exposure of the group members in these
situations exceeds EUR 1 million
Customers integrated into groups with an exposure over EUR 5 million, if they have a risk grade 125
Groups or
customers who are
not in default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over EUR 5 million, if a group member has a risk grade 124
or has a restructured loan and a risk grade 123\u00a0
Groups or customers with an exposure over EUR 10 million, if at least one member of the group is
in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds EUR 25
million
2. Regardless of the criteria described in the previous point, the individual analysis is only performed for customers
with a credit exposure over EUR 500,000, while customers with exposure below this limit are not considered
for the purpose of determining the exposure referred to in the previous point.
3. Other customers that do not meet the criteria defined in 1 will also be subject to individual analysis, if under the
following conditions:
\u2013 they have impairment as a result of the latest individual analysis;
\u2013 are classified in stage 2 as a result of the latest revision of the questionnaire analysing the signs of financial
difficulties;
\u2013 according to recent information, they show a significant deterioration in risk levels.
4. The individual analysis includes the following procedures:
\u2013 for customers that are not in default, the analysis of financial difficulties indicators to determine whether the
customer has objective signs of impairment, or whether it should be classified in stage 2 given the occurrence
of a significant increase in credit risk, considering for this purpose a set of predetermined signs;
\u2013 for customers in default or for which the previous analysis has allowed to conclude that the customer has
objective signs of impairment, determination of the loss.
5. For the situations identified in the first paragraph of point 4 above, involving corporate customers, the analysis
is the responsibility of the Rating Division, and the responsibility of the Credit Division for the remaining
customers.
6. For the situations identified in the second paragraph of point 4 above, the individual analysis to determine the
loss is the responsibility of the customer's management divisions and of the Credit Division, the latter with
regard to the customers managed by the Commercial Networks.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the
total credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed
at each balance sheet date the existence of objective evidence of impairment. In the assessment of impairment
losses in individual terms, the following factors were considered:
\u2013 total exposure of each customer towards the Group and the existence of overdue loans;
\u2013 viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations
in the future;
\u2013 the existence, nature and estimated value of the collaterals associated to each loan;
\u2013 the customer\u2019s available assets in liquidation or insolvency situations and the existence of preferential creditors;
\u2013 the amount and expected recovery term.
7. Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery
period to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk
Office as part of the regular process of collecting information, accompanied by detailed justification of the
proposed impairment.
8. The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be
a weighted rate considering the different recovery prospects for each part of the customer's liabilities.
9. The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualised perspective, the latter when cases that, due to their specificity, have
a high degree of uncertainty regarding the expected recovery estimation are identified.
10. The macroeconomic adjustment set out in previous point should be analysed annually and weighted
according to the type of recovery strategy associated with the exposure under analysis:
\u2013 for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global
way, to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one
scenario;
\u2013 for Gone Concern strategies (i.e., the recovery estimation is based on the realisation of the collateral), the
impact of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the
projected real estate index indicates significant changes ahead for the current valuation values.
11. It is the responsibility of the units referred to in points 5 and 6 to consider in their forecast macroeconomic
expectations that may influence the recoverability of the debt.
12. For the purposes of the preceding paragraphs, the Group's Economic Studies Area shall disclose the
macroeconomic data that allow the estimations to be made.
13. The decision to consider global impacts related to the going and gone concern scenarios should be made by
the Risk Committee, as proposed by the Risk Office.
14. For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be
considered casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013 recovery of collateral in geographies in which the Group has no relevant recovery experience;
\u2013 recovery of debt related to geographies in which there is strong political instability;
\u2013 recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013 recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013 recovery of debt related to debtors for whom there is a strong negative public exposure.
15. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
16. Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 115 of the Master Scale.
17. The individual analysis must be carried out annually and may be carried out more frequently for customers
who fall into certain situations of possible increased risk. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to
promote the early review of the individual analysis of this customer.
C1.5.6. Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis for the determination of loss are grouped
considering their risk characteristics and subject to a collective impairment analysis. The Group's credit portfolio is
divided by internal risk grades and according to the following segments:
a) Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project
finance, Institutions (banks/financial institutions), Sovereigns and Real estate development;
b) Segments not \u2018low default\u2019:
- Retail: Mortgage, Consumer and Small and medium-sized enterprises - Retail;
- Corporate: Small and medium enterprises - Corporate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013 financial assets with no signs of impairment at the reporting date: the present value of the difference between
the contractual cash flows and the cash flows that the Group expects to receive;
\u2013 financial assets with impairment at the reporting date: the difference between the gross book value and the
present value of the estimated cash flows;
\u2013 unused credit commitments: the present value of the difference between the resulting contractual cash flows
if the commitment is made and the cash flows that the Group expects to receive;
\u2013 financial guarantees: the current value of the expected repayments less the amounts that the Group expects
to recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013 Probability of Default \u2013 PD;
\u2013 Loss Given Default \u2013 LGD; and,
\u2013 Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering
the already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These
models are based on internal data including both quantitative and qualitative factors. If there is a change in the
risk of the counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated
considering the contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates
the LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models
consider the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs.
In the case of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of
high relevance in the determination of LGD, considering the applicable haircuts as well as the estimated time and
associated selling costs.
In the case of exposures from the securities portfolio of issuers that are Banks or Sovereigns, or subordinated
exposures, the LGD to be applied in the credit loss estimate considers the LGD defined for the purpose of
calculating capital requirements (CRR).
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD
values from the counterparty's current exposure and potential changes to its current value as a result of the
contractual conditions, including amortisations and prepayments. For commitments and financial guarantees, the
value of the EAD will consider both the amount of credit used and the expectation of future potential value that
may be used in accordance with the agreement.
For exposures covered by guarantees issued by Mutual Guarantee Societies or by supranational entities, the Bank
applies the PD and LGD parameters associated with these entities to the covered part of the EAD.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a
longer period. The maximum contractual period shall be considered as the period up to the date on which the
Group has the right to require payment or end the commitment or guarantee.
The Group conservatively considers a residual term of 5 years in the case of renewable operations, when in stage 2.
This term was determined based on the behavioural models associated with this type of product.
Incorporation of forward-looking information:
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-
looking information is carried out in the relevant elements considered for the calculation of expected credit losses
(ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing
exposures at the reference date becoming defaulted exposures considers the expected values for a set of
macroeconomic variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the
Group's Economic Studies area. These scenarios, which are used across the Group for various purposes besides
calculating impairment, consider existing forecasts by reference entities.
In December 2025, the Group carried out an update of the macroeconomic scenarios and of the corresponded
adjustment of the parameters considered in the collective impairment model.
It should be noted that, in 2025, the Group revised its IFRS 9 impairment models, focusing on alignment with the
IRB models, which were revised in 2024. This revision covered the criteria for identifying a significant increase in
credit risk \u2013 SICR (stage 2) and the models for estimating PD, LGD, EAD, and calculating ECL, addressing all
relevant components, such as historical information, segmentation, forward-looking adjustments, as well as the
review of the monitoring and backtesting framework
C2. Financial liabilities
C2.1. Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013 \u201cFinancial liabilities at amortised cost\u201d;
\u2013 \u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1. Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a) \u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that
form part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as
hedging instrument).
b) \u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013 the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013 the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in
market conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with
the costs or income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013 the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk
of that liability shall be presented in other comprehensive income;
\u2013 the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest and similar
expense\" based on the effective interest rate of each transaction.
C2.1.2. Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial
guarantee contracts are subsequently measured at the highest of the following amounts:
\u2013 the provision for losses determined according to the criteria described in note C1.5;
\u2013 the amount initially recognised deducted, when appropriate, from the accumulated amount of income
recognised according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial liabilities at amortised cost\" includes d eposits from credit institutions and other funds,
deposits from customers and other funds, as well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are
subsequently measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in
\"Interest and similar expense\", based on the effective interest rate method.
C2.2. Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3. Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.
C3. Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
C4. Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and
foreign exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge
accounting are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in
accordance with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013 at the inception of the hedge there is formal documentation of the hedge;
\u2013 the hedge is expected to be highly effective;
\u2013 the effectiveness of the hedge can be reliably measured;
\u2013 the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013 for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to
variations in cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets
or liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised
through profit and loss, as well as changes in currency risk of the monetary items.
C4.1. Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are
recognised in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or
liability or group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge
accounting, the cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised
until the discontinuance of the hedge accounting are amortised through profit and loss over the residual term of
the hedged item.
C4.2. Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify
as cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge
relations. Any gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and
loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will
affect profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the
hedging relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked,
the hedge relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative
accumulated in equity until the date of the discontinued hedge accounting can be:
\u2013 deferred over the residual period of the hedged instrument; or,
\u2013 recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised
in equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income
statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was
reported in equity is immediately transferred to profit and loss.
C4.3. Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such,
the Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective
tests in order to demonstrate at each reporting period the effectiveness of the hedging relationships,
demonstrating that the variations in fair value of the hedging instrument are hedged by the fair value variations of
the hedged item in the portion assigned to the risk covered. Any ineffectiveness is recognised immediately in
profit and loss when incurred.
C4.4. Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange
gain or loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The
gain or loss relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses
accumulated in equity related to the investment in a foreign operation and to the associated hedge operation are
recognised in equity and transferred to profit and loss, on the disposal of the foreign operation as part of the gain
or loss from the disposal.
C5. Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host
instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and rewards of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
Gains/(losses) on financial operations at fair value through profit or loss, Foreign
exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses)
arising from derecognition of financial assets and liabilities not measured at fair
value through profit or loss
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e.,
fair value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding
dividends received. This balance also includes the gains and losses on sale of financial assets at fair value through
other comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair
value of hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this
balance, as well as the foreign exchange gains or losses.
Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and
interest on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed
together to achieve a specific business objective. This evaluation requires judgement, since the following aspects,
among others, must be considered: the way in which the performance of assets is evaluated; the risks that affect
the performance of the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other
comprehensive income that are derecognised prior to their maturity to understand the underlying reasons for
their disposal and to determine whether they are consistent with the purpose of the business model defined for
these assets. This monitoring is part of a process of continuous evaluation by the Group of the business model of
the financial assets that remain in the portfolio, to determine if it is adequate and, if it is not, if there was a change
in the business model and, consequently, a prospective classification change of these financial assets.
Y6.2. Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3. Fair value of financial instruments
Fair value is determined based on market quotations when available, or, in their absence, on the prices of recent
similar transactions carried out under market conditions or through valuation methodologies supported by
discounted cash flow techniques, taking into consideration factors such as market conditions, the time value, the
yield curve, and volatility. When these methodologies involve the use of significant unobservable inputs or
assumptions, the instruments are classified as Level 3 in the fair value hierarchy, in accordance with applicable
accounting standards (IFRS 13). The use of different methodologies, assumptions, or judgements may result in
outcomes that differ from those reported.
In market environments characterised by higher macroeconomic uncertainty, the Group may, among other
measures, reallocate risk limits and review both stress scenarios and the calculation of fair value adjustments.
Y7.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-585": { "value": "Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following
conditions are met:
\u2013 the financial asset is held within a business model whose objective is to hold financial assets in order to collect
their contractual cash flows; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and
advances to customers and debt instruments managed based on a business model whose purpose is to receive
their contractual cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the
funds are made available to the counterparty (settlement date). Debt instruments are recognised on the trade
date, that is, on the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the
effective interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are recorded in \"Gains/(losses) arising from derecognition
of financial assets and liabilities not measured at fair value through profit or loss\".
C1.1.2. Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive
income\" if both of the following conditions are met:
\u2013 the financial asset is held within a business model whose objective is both to collect its contractual cash flows
and to sell this financial asset; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent
retribution recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may
irrevocably choose to classify it in the category of \"Financial assets at fair value through other comprehensive
income\" (FVOCI). This option is exercised on a case-by-case basis and is only available for financial instruments
that comply with the definition of equity instruments provided in IAS 32 and cannot be used for financial
instruments whose classification as an equity instrument under the scope of the issuer is made under the
exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
C1.1.3. Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
Recognition of income from services and commissions
In accordance with IFRS 15, the Group recognises revenue associated with services and commissions when (or as)
a performance obligation is satisfied when transferring a service, based on the transaction price associated with
this performance obligation. In this context, the Group takes the following steps to recognise revenue associated
with services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the
service provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations
associated with each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also
considering the contractual terms established with the counterparty. According to this definition, a service is
transferred when the customer obtains the benefits and control associated with the service provided. In this
context, the Group also identifies whether performance obligations are met over time (\u201cover time\u201d) or at an exact
moment (\u201cpoint in time\u201d), with revenue being recognised accordingly.
- Measurement (price to be recognised associated with each performance obligation): (i) determine the
transaction price associated with the service provided, considering the contractual terms established with the
counterparty and its usual commercial practices. The transaction price is the amount of consideration to which
the Group expects to be entitled in exchange for transferring promised services to the customer, excluding
amounts collected on behalf of third parties. The Group includes in the transaction price part or all of the
estimated amount of the variable consideration associated with a performance obligation, only to the extent that
it is highly probable that a significant reversal in the amount of the accrued revenue recognised will not occur
when the uncertainty associated with that variable consideration is subsequently resolved; and (ii) allocate the
transaction price to each of the performance obligations identified under the contract established with the
customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a
financial instrument, income resulting from services and commissions is recorded in net interest income (note
C.3).
Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements.
Fees and commissions arising from this activity are recognised in the income statement in the period in which
they occur.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRecognitionOfRevenue", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-586": { "value": "
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the
funds are made available to the counterparty (settlement date). Debt instruments are recognised on the trade
date, that is, on the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the
effective interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are recorded in \"Gains/(losses) arising from derecognition
of financial assets and liabilities not measured at fair value through profit or loss\".
C1.1.2.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRecognisingDifferenceBetweenFairValueAtInitialRecognitionAndAmountDeterminedUsingValuationTechniqueExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-587": { "value": "Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive
income\" if both of the following conditions are met:
\u2013 the financial asset is held within a business model whose objective is both to collect its contractual cash flows
and to sell this financial asset; and,
\u2013 its contractual cash flows occur on specific dates and are solely payments of principal and interest on the
principal amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent
retribution recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may
irrevocably choose to classify it in the category of \"Financial assets at fair value through other comprehensive
income\" (FVOCI). This option is exercised on a case-by-case basis and is only available for financial instruments
that comply with the definition of equity instruments provided in IAS 32 and cannot be used for financial
instruments whose classification as an equity instrument under the scope of the issuer is made under the
exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets
are recognised against other comprehensive income and, at the time of their disposal, the respective gains or
losses accumulated in other comprehensive income are reclassified to a specific income statement item
designated \"Gains or losses on derecognition of financial assets at fair value through other comprehensive
income\u201d.
Debt instruments at fair value through other comprehensive income are also subject from their initial recognition
to the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised
in the income statement under \"Impairment of financial assets at fair value through other comprehensive
income\", against \u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in
the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are
recognised in \"Interest and similar income\", based on the effective interest rate method and in accordance with
the criteria described in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial
assets are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement
when the right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d
at the time of their derecognition.
Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a) \u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that
form part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as
hedging instrument).
b) \u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013 the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013 the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in
market conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with
the costs or income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013 the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk
of that liability shall be presented in other comprehensive income;
\u2013 the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest and similar
expense\" based on the effective interest rate of each transaction.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFairValueMeasurementExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-588": { "value": "Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business
model defined by the Group for its management or the characteristics of its contractual cash flows do not meet
the conditions described above to be measured at amortised cost or at fair value through other comprehensive
income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise
arise from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a) \u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of
a portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or
they can be defined as derivatives (except for hedging derivatives).
b) \u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of
principal and interest on the principal amount outstanding (SPPI).
c) \u201cFinancial assets designated at fair value through profit or loss\u201d (Fair Value Option)
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market
conditions, financial assets at fair value through profit or loss are initially recognised at their fair value, with the
costs or income associated with the transactions recognised in profit and loss at the initial moment. Subsequent
changes in the fair value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\",
based on the effective interest rate of each transaction, except the accrual of interest from trading derivatives that
are recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are
recognised in profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while
trading derivatives with negative fair value are included in \"Financial liabilities held for trading\".
Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a) \u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that
form part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as
hedging instrument).
b) \u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013 the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013 the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in
market conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with
the costs or income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013 the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk
of that liability shall be presented in other comprehensive income;
\u2013 the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest and similar
expense\" based on the effective interest rate of each transaction.
Gains/(losses) on financial operations at fair value through profit or loss, Foreign
exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses)
arising from derecognition of financial assets and liabilities not measured at fair
value through profit or loss
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e.,
fair value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding
dividends received. This balance also includes the gains and losses on sale of financial assets at fair value through
other comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair
value of hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this
balance, as well as the foreign exchange gains or losses.
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives) and financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"),
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
In this class of assets, the fair value corresponds to their book value.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering
the volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the
available models do not fully apply to meet the characteristics of the financial instrument, specific quotations
supplied by an external entity are applied, typically a counterparty of the business.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsAtFairValueThroughProfitOrLossExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-589": { "value": "Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management
has changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including
the ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other
comprehensive income is not allowed, nor of financial instruments designated at fair value through profit or
loss.
Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForReclassificationOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-590": { "value": "Modification and derecognition of financial assets
General principles
i) The Group shall derecognise a financial asset when, and only when:
\u2013 the contractual rights to the cash flows from the financial asset expire; or,
\u2013 it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii) The Group transfers a financial asset if, and only if, it either:
\u2013 transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013 retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual
obligation to pay the cash flows to one or more recipients in an arrangement that meets the conditions
presented in note iii).
iii) When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'),
but assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'),
the Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are
met:
\u2013 the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013 the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013 the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without
material delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash
equivalents (as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the
collection date until the date of required remittance to the eventual recipients, and interest earned on such
investments is passed to the eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and rewards arising from owning the financial asset. In this case:
\u2013 if the Group transfers substantially all the risks and rewards arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013 if the Group retains substantially all the risks and rewards arising from owning the financial asset, it shall
continue to recognise the financial asset;
\u2013 if the Group neither transfers nor retains substantially all the risks and rewards arising from owning the
financial asset, it shall determine whether it retained control of the financial asset. In this case:
a) if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as
assets or liabilities, any rights and obligations created or retained in the transfer;
b) if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and rewards (see prior note) is evaluated by comparing the Group\u2019s exposure, before and
after the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset
depends on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in
its entirety to an unrelated third party and can exercise that ability unilaterally without needing to impose
additional restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained
control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of
new ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that
may lead to the derecognition of a financial asset.
The Group considers that a modification of the terms and conditions of a credit exposure will result in
derecognition of the transaction and in recognition of a new transaction when the modification translates into at
least one of the following conditions:
\u2013 Creation of a new exposure that results from a debt consolidation, without any of the derecognised instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013 Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to
the residual maturity in the moment of the modification;
\u2013 Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013 Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or
managed within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on
the financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv
of the above paragraphs should be checked (the other criteria listed in this paragraph are not relevant in such
situations).
Under the regulatory changes that occurred in Poland and the negotiations with customers holding mortgage
loans in foreign currency described in note 58, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a
given asset is not derecognised, the Group adjusts the gross book value of the financial asset and recognises the
profit or loss due to the modification in the Income Statement - Results on modification. The adjustment to the
gross carrying amount of a financial asset is the difference between the discounted cash flows before and after
contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its
entirety or partially. Loan recoveries and loans written off are recorded under the Impairment of financial assets at
amortised cost and in off-balance sheet accounts, respectively.
Derecognition of financial liabilitiesThe Group derecognises financial liabilities when these are cancelled or extinct.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerecognitionOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-592": { "value": "Impairment losses
C1.5.1. Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the
following accounting items:
C1.5.1.1. Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets
against the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2. Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\",
against other comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3. Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are
recognised in liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other
provisions\" (in the income statement).
C1.5.2. Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk
since its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013 Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to
expected credit losses resulting from a default event that may occur within 12 months after the reporting date
(12-month expected credit losses);
\u2013 Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note
C1.5.3) but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with
operations classified in this stage correspond to the expected credit losses resulting from default events that
may occur over the expected residual life of the operations (lifetime expected credit losses);
\u2013 Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified
at this stage correspond to lifetime expected credit losses.
C1.5.3. Significant increase in credit risk (SICR)
The Group uses a set of criteria to determine whether there is a significant increase in the Probability of Default
(PD) (Significant increase in Credit Risk) associated with credit exposures, which leads to a stage 2 classification.
Among the criteria considered by the Group, the following are noteworthy:
(i) customers classified with procedural risk grade 123 or 124, due to material arrears of more than 30 days or being
monitored by credit recovery, or with no assigned risk grade;
(ii) customers with a deterioration of the risk grade on the internal scale, above pre-defined thresholds, between
the initial recognition date of the contract and the impairment calculation date;
(iii) relative change in the cumulative Probability of Default (PD) for the remaining maturity of the exposure
(Lifetime Forward-looking PD) above a certain threshold;
(iv) exposures whose absolute value of the 12-month Forward-looking PD at the reporting date exceeds a certain
threshold;
(v) customers with operations restructured due to financial difficulties;
(vi) customers with incidents reported through the Banco de Portugal's Central Credit Register; and
(vii) customers subject to individual analysis for whom a stage 2 classification has been concluded due to the
occurrence of a significant increase in credit risk, taking into account a set of predetermined indicators for this
purpose.
Exposures that no longer meet the criteria to be classified as stage 2 are classified as stage 1.
Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than EUR 100 (retail) or more than EUR 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in
which the customer is in this situation have been counted, it is classified as default.
The existence of a material payment delay gives rise to the default setting of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i. Credit restructuring due to financial difficulties with loss of value;
ii. Delay after restructuring due to financial difficulties;
iii. Recurrence of restructuring due to financial difficulties;
iv. Credit with signs of impairment (or stage 3 of IFRS 9);
v. Insolvency or equivalent proceedings;
vi. Litigation;
vii. Guarantees of operations in default;
viii. Credit sales with losses;
ix. Credit fraud;
x. Unpaid credit status;
xi. Breach of covenants in a credit agreement;
xii. Spread of default in an economic group;
xiii. Cross default in BCP Group.
Estimates of expected credit losses - Individual analysis
1. Customers who are in one of the following conditions are subject to individual analysis:
Customers in
default
Customers in litigation or insolvency, if the total exposure of the group members in these
situations exceeds EUR 1 million
Customers integrated into groups with an exposure over EUR 5 million, if they have a risk grade 125
Groups or
customers who are
not in default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over EUR 5 million, if a group member has a risk grade 124
or has a restructured loan and a risk grade 123\u00a0
Groups or customers with an exposure over EUR 10 million, if at least one member of the group is
in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds EUR 25
million
2. Regardless of the criteria described in the previous point, the individual analysis is only performed for customers
with a credit exposure over EUR 500,000, while customers with exposure below this limit are not considered
for the purpose of determining the exposure referred to in the previous point.
3. Other customers that do not meet the criteria defined in 1 will also be subject to individual analysis, if under the
following conditions:
\u2013 they have impairment as a result of the latest individual analysis;
\u2013 are classified in stage 2 as a result of the latest revision of the questionnaire analysing the signs of financial
difficulties;
\u2013 according to recent information, they show a significant deterioration in risk levels.
4. The individual analysis includes the following procedures:
\u2013 for customers that are not in default, the analysis of financial difficulties indicators to determine whether the
customer has objective signs of impairment, or whether it should be classified in stage 2 given the occurrence
of a significant increase in credit risk, considering for this purpose a set of predetermined signs;
\u2013 for customers in default or for which the previous analysis has allowed to conclude that the customer has
objective signs of impairment, determination of the loss.
5. For the situations identified in the first paragraph of point 4 above, involving corporate customers, the analysis
is the responsibility of the Rating Division, and the responsibility of the Credit Division for the remaining
customers.
6. For the situations identified in the second paragraph of point 4 above, the individual analysis to determine the
loss is the responsibility of the customer's management divisions and of the Credit Division, the latter with
regard to the customers managed by the Commercial Networks.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the
total credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed
at each balance sheet date the existence of objective evidence of impairment. In the assessment of impairment
losses in individual terms, the following factors were considered:
\u2013 total exposure of each customer towards the Group and the existence of overdue loans;
\u2013 viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations
in the future;
\u2013 the existence, nature and estimated value of the collaterals associated to each loan;
\u2013 the customer\u2019s available assets in liquidation or insolvency situations and the existence of preferential creditors;
\u2013 the amount and expected recovery term.
7. Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery
period to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk
Office as part of the regular process of collecting information, accompanied by detailed justification of the
proposed impairment.
8. The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be
a weighted rate considering the different recovery prospects for each part of the customer's liabilities.
9. The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualised perspective, the latter when cases that, due to their specificity, have
a high degree of uncertainty regarding the expected recovery estimation are identified.
10. The macroeconomic adjustment set out in previous point should be analysed annually and weighted
according to the type of recovery strategy associated with the exposure under analysis:
\u2013 for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global
way, to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one
scenario;
\u2013 for Gone Concern strategies (i.e., the recovery estimation is based on the realisation of the collateral), the
impact of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the
projected real estate index indicates significant changes ahead for the current valuation values.
11. It is the responsibility of the units referred to in points 5 and 6 to consider in their forecast macroeconomic
expectations that may influence the recoverability of the debt.
12. For the purposes of the preceding paragraphs, the Group's Economic Studies Area shall disclose the
macroeconomic data that allow the estimations to be made.
13. The decision to consider global impacts related to the going and gone concern scenarios should be made by
the Risk Committee, as proposed by the Risk Office.
14. For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be
considered casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013 recovery of collateral in geographies in which the Group has no relevant recovery experience;
\u2013 recovery of debt related to geographies in which there is strong political instability;
\u2013 recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013 recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013 recovery of debt related to debtors for whom there is a strong negative public exposure.
15. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
16. Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 115 of the Master Scale.
17. The individual analysis must be carried out annually and may be carried out more frequently for customers
who fall into certain situations of possible increased risk. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to
promote the early review of the individual analysis of this customer.
Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis for the determination of loss are grouped
considering their risk characteristics and subject to a collective impairment analysis. The Group's credit portfolio is
divided by internal risk grades and according to the following segments:
a) Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project
finance, Institutions (banks/financial institutions), Sovereigns and Real estate development;
b) Segments not \u2018low default\u2019:
- Retail: Mortgage, Consumer and Small and medium-sized enterprises - Retail;
- Corporate: Small and medium enterprises - Corporate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013 financial assets with no signs of impairment at the reporting date: the present value of the difference between
the contractual cash flows and the cash flows that the Group expects to receive;
\u2013 financial assets with impairment at the reporting date: the difference between the gross book value and the
present value of the estimated cash flows;
\u2013 unused credit commitments: the present value of the difference between the resulting contractual cash flows
if the commitment is made and the cash flows that the Group expects to receive;
\u2013 financial guarantees: the current value of the expected repayments less the amounts that the Group expects
to recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013 Probability of Default \u2013 PD;
\u2013 Loss Given Default \u2013 LGD; and,
\u2013 Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering
the already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These
models are based on internal data including both quantitative and qualitative factors. If there is a change in the
risk of the counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated
considering the contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates
the LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models
consider the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs.
In the case of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of
high relevance in the determination of LGD, considering the applicable haircuts as well as the estimated time and
associated selling costs.
In the case of exposures from the securities portfolio of issuers that are Banks or Sovereigns, or subordinated
exposures, the LGD to be applied in the credit loss estimate considers the LGD defined for the purpose of
calculating capital requirements (CRR).
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD
values from the counterparty's current exposure and potential changes to its current value as a result of the
contractual conditions, including amortisations and prepayments. For commitments and financial guarantees, the
value of the EAD will consider both the amount of credit used and the expectation of future potential value that
may be used in accordance with the agreement.
For exposures covered by guarantees issued by Mutual Guarantee Societies or by supranational entities, the Bank
applies the PD and LGD parameters associated with these entities to the covered part of the EAD.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a
longer period. The maximum contractual period shall be considered as the period up to the date on which the
Group has the right to require payment or end the commitment or guarantee.
The Group conservatively considers a residual term of 5 years in the case of renewable operations, when in stage 2.
This term was determined based on the behavioural models associated with this type of product.
Incorporation of forward-looking information:
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-
looking information is carried out in the relevant elements considered for the calculation of expected credit losses
(ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing
exposures at the reference date becoming defaulted exposures considers the expected values for a set of
macroeconomic variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the
Group's Economic Studies area. These scenarios, which are used across the Group for various purposes besides
calculating impairment, consider existing forecasts by reference entities.
In December 2025, the Group carried out an update of the macroeconomic scenarios and of the corresponded
adjustment of the parameters considered in the collective impairment model.
It should be noted that, in 2025, the Group revised its IFRS 9 impairment models, focusing on alignment with the
IRB models, which were revised in 2024. This revision covered the criteria for identifying a significant increase in
credit risk \u2013 SICR (stage 2) and the models for estimating PD, LGD, EAD, and calculating ECL, addressing all
relevant components, such as historical information, segmentation, forward-looking adjustments, as well as the
review of the monitoring and backtesting framework
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated
and an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The
recoverable amount is determined as the highest between the fair value less costs to sell and its value in use
calculated based on the present value of future cash flows estimated to be obtained from the continued use of
the asset and its sale at the end of the useful life. The impairment losses of the fixed tangible assets are recognised
in the income statement of the period.
M.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-591": { "value": "Impairment losses
C1.5.1. Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the
following accounting items:
C1.5.1.1. Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets
against the item \"Impairment of financial assets at amortised cost\" (in the income statement).
Significant increase in credit risk (SICR)
The Group uses a set of criteria to determine whether there is a significant increase in the Probability of Default
(PD) (Significant increase in Credit Risk) associated with credit exposures, which leads to a stage 2 classification.
Among the criteria considered by the Group, the following are noteworthy:
(i) customers classified with procedural risk grade 123 or 124, due to material arrears of more than 30 days or being
monitored by credit recovery, or with no assigned risk grade;
(ii) customers with a deterioration of the risk grade on the internal scale, above pre-defined thresholds, between
the initial recognition date of the contract and the impairment calculation date;
(iii) relative change in the cumulative Probability of Default (PD) for the remaining maturity of the exposure
(Lifetime Forward-looking PD) above a certain threshold;
(iv) exposures whose absolute value of the 12-month Forward-looking PD at the reporting date exceeds a certain
threshold;
(v) customers with operations restructured due to financial difficulties;
(vi) customers with incidents reported through the Banco de Portugal's Central Credit Register; and
(vii) customers subject to individual analysis for whom a stage 2 classification has been concluded due to the
occurrence of a significant increase in credit risk, taking into account a set of predetermined indicators for this
purpose.
Exposures that no longer meet the criteria to be classified as stage 2 are classified as stage 1.
Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than EUR 100 (retail) or more than EUR 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in
which the customer is in this situation have been counted, it is classified as default.
The existence of a material payment delay gives rise to the default setting of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i. Credit restructuring due to financial difficulties with loss of value;
ii. Delay after restructuring due to financial difficulties;
iii. Recurrence of restructuring due to financial difficulties;
iv. Credit with signs of impairment (or stage 3 of IFRS 9);
v. Insolvency or equivalent proceedings;
vi. Litigation;
vii. Guarantees of operations in default;
viii. Credit sales with losses;
ix. Credit fraud;
x. Unpaid credit status;
xi. Breach of covenants in a credit agreement;
xii. Spread of default in an economic group;
xiii. Cross default in BCP Group.
Estimates of expected credit losses - Individual analysis
1. Customers who are in one of the following conditions are subject to individual analysis:
Customers in
default
Customers in litigation or insolvency, if the total exposure of the group members in these
situations exceeds EUR 1 million
Customers integrated into groups with an exposure over EUR 5 million, if they have a risk grade 125
Groups or
customers who are
not in default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over EUR 5 million, if a group member has a risk grade 124
or has a restructured loan and a risk grade 123\u00a0
Groups or customers with an exposure over EUR 10 million, if at least one member of the group is
in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds EUR 25
million
2. Regardless of the criteria described in the previous point, the individual analysis is only performed for customers
with a credit exposure over EUR 500,000, while customers with exposure below this limit are not considered
for the purpose of determining the exposure referred to in the previous point.
3. Other customers that do not meet the criteria defined in 1 will also be subject to individual analysis, if under the
following conditions:
\u2013 they have impairment as a result of the latest individual analysis;
\u2013 are classified in stage 2 as a result of the latest revision of the questionnaire analysing the signs of financial
difficulties;
\u2013 according to recent information, they show a significant deterioration in risk levels.
4. The individual analysis includes the following procedures:
\u2013 for customers that are not in default, the analysis of financial difficulties indicators to determine whether the
customer has objective signs of impairment, or whether it should be classified in stage 2 given the occurrence
of a significant increase in credit risk, considering for this purpose a set of predetermined signs;
\u2013 for customers in default or for which the previous analysis has allowed to conclude that the customer has
objective signs of impairment, determination of the loss.
5. For the situations identified in the first paragraph of point 4 above, involving corporate customers, the analysis
is the responsibility of the Rating Division, and the responsibility of the Credit Division for the remaining
customers.
6. For the situations identified in the second paragraph of point 4 above, the individual analysis to determine the
loss is the responsibility of the customer's management divisions and of the Credit Division, the latter with
regard to the customers managed by the Commercial Networks.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the
total credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed
at each balance sheet date the existence of objective evidence of impairment. In the assessment of impairment
losses in individual terms, the following factors were considered:
\u2013 total exposure of each customer towards the Group and the existence of overdue loans;
\u2013 viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations
in the future;
\u2013 the existence, nature and estimated value of the collaterals associated to each loan;
\u2013 the customer\u2019s available assets in liquidation or insolvency situations and the existence of preferential creditors;
\u2013 the amount and expected recovery term.
7. Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery
period to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk
Office as part of the regular process of collecting information, accompanied by detailed justification of the
proposed impairment.
8. The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be
a weighted rate considering the different recovery prospects for each part of the customer's liabilities.
9. The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualised perspective, the latter when cases that, due to their specificity, have
a high degree of uncertainty regarding the expected recovery estimation are identified.
10. The macroeconomic adjustment set out in previous point should be analysed annually and weighted
according to the type of recovery strategy associated with the exposure under analysis:
\u2013 for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global
way, to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one
scenario;
\u2013 for Gone Concern strategies (i.e., the recovery estimation is based on the realisation of the collateral), the
impact of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the
projected real estate index indicates significant changes ahead for the current valuation values.
11. It is the responsibility of the units referred to in points 5 and 6 to consider in their forecast macroeconomic
expectations that may influence the recoverability of the debt.
12. For the purposes of the preceding paragraphs, the Group's Economic Studies Area shall disclose the
macroeconomic data that allow the estimations to be made.
13. The decision to consider global impacts related to the going and gone concern scenarios should be made by
the Risk Committee, as proposed by the Risk Office.
14. For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be
considered casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013 recovery of collateral in geographies in which the Group has no relevant recovery experience;
\u2013 recovery of debt related to geographies in which there is strong political instability;
\u2013 recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013 recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013 recovery of debt related to debtors for whom there is a strong negative public exposure.
15. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
16. Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 115 of the Master Scale.
17. The individual analysis must be carried out annually and may be carried out more frequently for customers
who fall into certain situations of possible increased risk. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to
promote the early review of the individual analysis of this customer.
Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis for the determination of loss are grouped
considering their risk characteristics and subject to a collective impairment analysis. The Group's credit portfolio is
divided by internal risk grades and according to the following segments:
a) Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project
finance, Institutions (banks/financial institutions), Sovereigns and Real estate development;
b) Segments not \u2018low default\u2019:
- Retail: Mortgage, Consumer and Small and medium-sized enterprises - Retail;
- Corporate: Small and medium enterprises - Corporate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013 financial assets with no signs of impairment at the reporting date: the present value of the difference between
the contractual cash flows and the cash flows that the Group expects to receive;
\u2013 financial assets with impairment at the reporting date: the difference between the gross book value and the
present value of the estimated cash flows;
\u2013 unused credit commitments: the present value of the difference between the resulting contractual cash flows
if the commitment is made and the cash flows that the Group expects to receive;
\u2013 financial guarantees: the current value of the expected repayments less the amounts that the Group expects
to recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013 Probability of Default \u2013 PD;
\u2013 Loss Given Default \u2013 LGD; and,
\u2013 Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering
the already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These
models are based on internal data including both quantitative and qualitative factors. If there is a change in the
risk of the counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated
considering the contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates
the LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models
consider the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs.
In the case of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of
high relevance in the determination of LGD, considering the applicable haircuts as well as the estimated time and
associated selling costs.
In the case of exposures from the securities portfolio of issuers that are Banks or Sovereigns, or subordinated
exposures, the LGD to be applied in the credit loss estimate considers the LGD defined for the purpose of
calculating capital requirements (CRR).
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD
values from the counterparty's current exposure and potential changes to its current value as a result of the
contractual conditions, including amortisations and prepayments. For commitments and financial guarantees, the
value of the EAD will consider both the amount of credit used and the expectation of future potential value that
may be used in accordance with the agreement.
For exposures covered by guarantees issued by Mutual Guarantee Societies or by supranational entities, the Bank
applies the PD and LGD parameters associated with these entities to the covered part of the EAD.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a
longer period. The maximum contractual period shall be considered as the period up to the date on which the
Group has the right to require payment or end the commitment or guarantee.
The Group conservatively considers a residual term of 5 years in the case of renewable operations, when in stage 2.
This term was determined based on the behavioural models associated with this type of product.
Incorporation of forward-looking information:
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-
looking information is carried out in the relevant elements considered for the calculation of expected credit losses
(ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing
exposures at the reference date becoming defaulted exposures considers the expected values for a set of
macroeconomic variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the
Group's Economic Studies area. These scenarios, which are used across the Group for various purposes besides
calculating impairment, consider existing forecasts by reference entities.
In December 2025, the Group carried out an update of the macroeconomic scenarios and of the corresponded
adjustment of the parameters considered in the collective impairment model.
It should be noted that, in 2025, the Group revised its IFRS 9 impairment models, focusing on alignment with the
IRB models, which were revised in 2024. This revision covered the criteria for identifying a significant increase in
credit risk \u2013 SICR (stage 2) and the models for estimating PD, LGD, EAD, and calculating ECL, addressing all
relevant components, such as historical information, segmentation, forward-looking adjustments, as well as the
review of the monitoring and backtesting framework
Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfFinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-593": { "value": "Financial liabilities
C2.1. Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013 \u201cFinancial liabilities at amortised cost\u201d;
\u2013 \u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1. Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a) \u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that
form part of a portfolio of identified financial instruments that are managed together and for which there is
evidence of a recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as
hedging instrument).
b) \u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013 the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013 the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in
market conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with
the costs or income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013 the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk
of that liability shall be presented in other comprehensive income;
\u2013 the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest and similar
expense\" based on the effective interest rate of each transaction.
C2.1.2. Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial
guarantee contracts are subsequently measured at the highest of the following amounts:
\u2013 the provision for losses determined according to the criteria described in note C1.5;
\u2013 the amount initially recognised deducted, when appropriate, from the accumulated amount of income
recognised according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial liabilities at amortised cost\" includes d eposits from credit institutions and other funds,
deposits from customers and other funds, as well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are
subsequently measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in
\"Interest and similar expense\", based on the effective interest rate method.
C2.2. Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3. Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-594": { "value": "Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial
guarantee contracts are subsequently measured at the highest of the following amounts:
\u2013 the provision for losses determined according to the criteria described in note C1.5;
\u2013 the amount initially recognised deducted, when appropriate, from the accumulated amount of income
recognised according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialGuaranteesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-596": { "value": "Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial liabilities at amortised cost\" includes d eposits from credit institutions and other funds,
deposits from customers and other funds, as well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are
subsequently measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in
\"Interest and similar expense\", based on the effective interest rate method.
Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBorrowingsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-595": { "value": "Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial liabilities at amortised cost\" includes d eposits from credit institutions and other funds,
deposits from customers and other funds, as well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are
subsequently measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in
\"Interest and similar expense\", based on the effective interest rate method.
Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBorrowingCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-600": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInterestIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-599": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForExpensesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-598": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-597": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest and similar expense\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the
expected life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of
the financial asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms
of the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs
and all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value
through profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by
applying the effective interest rate for each contract on its gross book value. The gross balance of a contract is its
amortised cost, before deducting the respective impairment. For financial assets included in stage 3, interest is
recognised in the income statement based on its net book value (less impairment). The interest recognition is
always made in a prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised
cost (net of impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit
losses in determining the expected future cash flows receivable from the financial asset.
Recognition of income from services and commissions
In accordance with IFRS 15, the Group recognises revenue associated with services and commissions when (or as)
a performance obligation is satisfied when transferring a service, based on the transaction price associated with
this performance obligation. In this context, the Group takes the following steps to recognise revenue associated
with services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the
service provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations
associated with each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also
considering the contractual terms established with the counterparty. According to this definition, a service is
transferred when the customer obtains the benefits and control associated with the service provided. In this
context, the Group also identifies whether performance obligations are met over time (\u201cover time\u201d) or at an exact
moment (\u201cpoint in time\u201d), with revenue being recognised accordingly.
- Measurement (price to be recognised associated with each performance obligation): (i) determine the
transaction price associated with the service provided, considering the contractual terms established with the
counterparty and its usual commercial practices. The transaction price is the amount of consideration to which
the Group expects to be entitled in exchange for transferring promised services to the customer, excluding
amounts collected on behalf of third parties. The Group includes in the transaction price part or all of the
estimated amount of the variable consideration associated with a performance obligation, only to the extent that
it is highly probable that a significant reversal in the amount of the accrued revenue recognised will not occur
when the uncertainty associated with that variable consideration is subsequently resolved; and (ii) allocate the
transaction price to each of the performance obligations identified under the contract established with the
customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a
financial instrument, income resulting from services and commissions is recorded in net interest income (note
C.3).
Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements.
Fees and commissions arising from this activity are recognised in the income statement in the period in which
they occur.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceIncomeAndCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-602": { "value": "Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and
foreign exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge
accounting are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in
accordance with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013 at the inception of the hedge there is formal documentation of the hedge;
\u2013 the hedge is expected to be highly effective;
\u2013 the effectiveness of the hedge can be reliably measured;
\u2013 the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013 for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to
variations in cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets
or liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised
through profit and loss, as well as changes in currency risk of the monetary items.
C4.1. Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are
recognised in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or
liability or group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge
accounting, the cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised
until the discontinuance of the hedge accounting are amortised through profit and loss over the residual term of
the hedged item.
C4.2. Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify
as cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge
relations. Any gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and
loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will
affect profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the
hedging relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked,
the hedge relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative
accumulated in equity until the date of the discontinued hedge accounting can be:
\u2013 deferred over the residual period of the hedged instrument; or,
\u2013 recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised
in equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income
statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was
reported in equity is immediately transferred to profit and loss.
C4.3. Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such,
the Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective
tests in order to demonstrate at each reporting period the effectiveness of the hedging relationships,
demonstrating that the variations in fair value of the hedging instrument are hedged by the fair value variations of
the hedged item in the portion assigned to the risk covered. Any ineffectiveness is recognised immediately in
profit and loss when incurred.
C4.4. Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange
gain or loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The
gain or loss relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses
accumulated in equity related to the investment in a foreign operation and to the associated hedge operation are
recognised in equity and transferred to profit and loss, on the disposal of the foreign operation as part of the gain
or loss from the disposal.
The detailed information of the strategies, hedge transactions, hedged items and hedging instruments applied by
the Group, is shown in a table below:
Strategy
Description of hedge transactions
Hedged items
Hedging
instruments
Cash flow volatility hedge of
the flows generated by the
portfolio of EUR floating rate
mortgage loans (a)
Group hedges the risk of the volatility of interest
payments from floating rate mortgages. The
volatility of cash flows results from interest rate risk
Floating rate mortgage loans (BCP
S.A.)
Interest Rate
Swap (IRS)
transactions
Cash flow volatility hedge due
to future income and interest
costs denominated in foreign
currencies (a)
The Group hedges the risk of the volatility of cash
flows generated by income and interest costs
denominated in foreign currencies. The volatility of
cash flows results from the currency risk
Cash flows resulting from income
and interest costs denominated in
foreign currencies (Bank
Millennium S.A.)
FX position
transactions
Cash flow volatility hedge for
the flows generated by FX
mortgage portfolio and its
underlying PLN liabilities (a)
The Group hedges the risk of the volatility of cash
flows generated by FX mortgages and by PLN
liabilities financially underlying such loans. The
volatility of cash flows results from the currency risk
and interest rate risk
Cash flows resulting from the FX
mortgage loan portfolio and PLN
deposits together with issued debt
PLN securities funding them (Bank
Millennium S.A.)
CIRS
transactions
Hedge of volatility of the cash
flows generated by PLN
denominated financial assets
(a)
The Group hedges the risk of the volatility of cash
flows generated by PLN denominated financial
assets. The volatility of cash flows results from
interest rate risk
Cash flows resulting from PLN
denominated financial assets (Bank
Millennium S.A.)
IRS
transactions
Fair value hedge of fixed rate
loans (a)
Group hedges changes in the fair value of cash
flows of fixed rate loans due to changes in market
interest rates
Fixed rate loans (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at amortised cost
(BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments in EUR (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at fair value
through other comprehensive
income (BCP S.A. and ActivoBank
S.A.)
IRS
transactions
Fair value hedge of fixed rate
issued debt instruments in EUR
(a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate Issued debt (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Term deposits (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (macro hedge)
(a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Repayable demand deposits
without maturity (BCP S.A. and
ActivoBank S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in USD (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in foreign exchange and in
market interest rates
Term deposits (BCP S.A.)
CIRS
transactions
Fair value hedge of a fixed
interest rate debt instrument
(macro hedge) (a)
The Group hedges part of the interest rate risk
associated with the change in the fair value of a
fixed-rate debt instrument recorded in other
comprehensive income, resulting from fluctuations
in market interest rate
A portfolio of fixed coupon debt
securities classified as financial
assets measured at fair value
through other comprehensive
income denominated in PLN (Bank
Millennium S.A.)
IRS
transactions
Hedging the fair value of cash
flows from issued fixed-rate
liabilities denominated in
foreign currencies (a)
The Group hedges part of the interest rate risk
related to changes in the fair value of cash flows
from issued fixed-rate liabilities denominated in
foreign currencies, resulting from the volatility of
market interest rates
Cash flows from issued fixed-rate
liabilities denominated in foreign
currencies (Bank Millennium S.A.)
IRS
transactions
Hedging the fair value of the
risk profile assigned to a
portfolio of homogeneous, non-
interest-bearing current
accounts in PLN (portfolio
hedge) (b)
The Group hedges part of the interest rate risk
related to the change in the fair value of the risk
profile assigned to the portfolios of homogeneous,
non-interest-bearing current accounts in PLN and
separately foreign currencies, resulting from the
volatility of market interest rates.
Risk profile assigned to a portfolios
of homogeneous, non-interest-
bearing current accounts in PLN
and separately in foreign currencies
(Bank Millennium S.A.).
IRS
transactions
(a) - Strategy applied in 2025 and 2024.
(b) - Strategy applied in 2025.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForHedgingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-601": { "value": "Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and
foreign exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge
accounting are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in
accordance with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013 at the inception of the hedge there is formal documentation of the hedge;
\u2013 the hedge is expected to be highly effective;
\u2013 the effectiveness of the hedge can be reliably measured;
\u2013 the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013 for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to
variations in cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets
or liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised
through profit and loss, as well as changes in currency risk of the monetary items.
C4.1. Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are
recognised in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or
liability or group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge
accounting, the cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised
until the discontinuance of the hedge accounting are amortised through profit and loss over the residual term of
the hedged item.
C4.2. Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify
as cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge
relations. Any gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and
loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will
affect profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the
hedging relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked,
the hedge relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative
accumulated in equity until the date of the discontinued hedge accounting can be:
\u2013 deferred over the residual period of the hedged instrument; or,
\u2013 recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised
in equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income
statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was
reported in equity is immediately transferred to profit and loss.
C4.3. Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such,
the Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective
tests in order to demonstrate at each reporting period the effectiveness of the hedging relationships,
demonstrating that the variations in fair value of the hedging instrument are hedged by the fair value variations of
the hedged item in the portion assigned to the risk covered. Any ineffectiveness is recognised immediately in
profit and loss when incurred.
C4.4. Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange
gain or loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The
gain or loss relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses
accumulated in equity related to the investment in a foreign operation and to the associated hedge operation are
recognised in equity and transferred to profit and loss, on the disposal of the foreign operation as part of the gain
or loss from the disposal.
C5. Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host
instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and rewards of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.
The detailed information of the strategies, hedge transactions, hedged items and hedging instruments applied by
the Group, is shown in a table below:
Strategy
Description of hedge transactions
Hedged items
Hedging
instruments
Cash flow volatility hedge of
the flows generated by the
portfolio of EUR floating rate
mortgage loans (a)
Group hedges the risk of the volatility of interest
payments from floating rate mortgages. The
volatility of cash flows results from interest rate risk
Floating rate mortgage loans (BCP
S.A.)
Interest Rate
Swap (IRS)
transactions
Cash flow volatility hedge due
to future income and interest
costs denominated in foreign
currencies (a)
The Group hedges the risk of the volatility of cash
flows generated by income and interest costs
denominated in foreign currencies. The volatility of
cash flows results from the currency risk
Cash flows resulting from income
and interest costs denominated in
foreign currencies (Bank
Millennium S.A.)
FX position
transactions
Cash flow volatility hedge for
the flows generated by FX
mortgage portfolio and its
underlying PLN liabilities (a)
The Group hedges the risk of the volatility of cash
flows generated by FX mortgages and by PLN
liabilities financially underlying such loans. The
volatility of cash flows results from the currency risk
and interest rate risk
Cash flows resulting from the FX
mortgage loan portfolio and PLN
deposits together with issued debt
PLN securities funding them (Bank
Millennium S.A.)
CIRS
transactions
Hedge of volatility of the cash
flows generated by PLN
denominated financial assets
(a)
The Group hedges the risk of the volatility of cash
flows generated by PLN denominated financial
assets. The volatility of cash flows results from
interest rate risk
Cash flows resulting from PLN
denominated financial assets (Bank
Millennium S.A.)
IRS
transactions
Fair value hedge of fixed rate
loans (a)
Group hedges changes in the fair value of cash
flows of fixed rate loans due to changes in market
interest rates
Fixed rate loans (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at amortised cost
(BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments in EUR (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at fair value
through other comprehensive
income (BCP S.A. and ActivoBank
S.A.)
IRS
transactions
Fair value hedge of fixed rate
issued debt instruments in EUR
(a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate Issued debt (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Term deposits (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (macro hedge)
(a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Repayable demand deposits
without maturity (BCP S.A. and
ActivoBank S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in USD (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in foreign exchange and in
market interest rates
Term deposits (BCP S.A.)
CIRS
transactions
Fair value hedge of a fixed
interest rate debt instrument
(macro hedge) (a)
The Group hedges part of the interest rate risk
associated with the change in the fair value of a
fixed-rate debt instrument recorded in other
comprehensive income, resulting from fluctuations
in market interest rate
A portfolio of fixed coupon debt
securities classified as financial
assets measured at fair value
through other comprehensive
income denominated in PLN (Bank
Millennium S.A.)
IRS
transactions
Hedging the fair value of cash
flows from issued fixed-rate
liabilities denominated in
foreign currencies (a)
The Group hedges part of the interest rate risk
related to changes in the fair value of cash flows
from issued fixed-rate liabilities denominated in
foreign currencies, resulting from the volatility of
market interest rates
Cash flows from issued fixed-rate
liabilities denominated in foreign
currencies (Bank Millennium S.A.)
IRS
transactions
Hedging the fair value of the
risk profile assigned to a
portfolio of homogeneous, non-
interest-bearing current
accounts in PLN (portfolio
hedge) (b)
The Group hedges part of the interest rate risk
related to the change in the fair value of the risk
profile assigned to the portfolios of homogeneous,
non-interest-bearing current accounts in PLN and
separately foreign currencies, resulting from the
volatility of market interest rates.
Risk profile assigned to a portfolios
of homogeneous, non-interest-
bearing current accounts in PLN
and separately in foreign currencies
(Bank Millennium S.A.).
IRS
transactions
(a) - Strategy applied in 2025 and 2024.
(b) - Strategy applied in 2025.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsAndHedgingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-603": { "value": "Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host
instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and rewards of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-605": { "value": "Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to
deliver cash or another financial asset to another entity or to exchange financial assets or financial liabilities with
another entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may
be settled in the issuer's own equity instruments, it is either a non-derivative that includes no contractual
obligation for the issuer to deliver a variable number of its own equity instruments or a derivative that will be
settled only by the issuer exchanging a fixed amount of cash or another financial asset for a fixed number of its
own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity
after deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to
the amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised
in equity, net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is
solely at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are
deducted to equity.
F.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDividendsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-604": { "value": "Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to
deliver cash or another financial asset to another entity or to exchange financial assets or financial liabilities with
another entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may
be settled in the issuer's own equity instruments, it is either a non-derivative that includes no contractual
obligation for the issuer to deliver a variable number of its own equity instruments or a derivative that will be
settled only by the issuer exchanging a fixed amount of cash or another financial asset for a fixed number of its
own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity
after deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to
the amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised
in equity, net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is
solely at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are
deducted to equity.
F.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIssuedCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-607": { "value": "Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities
substantially equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to
reselling agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in
loans and advances to customers or loans and advances to credit institutions. The receivables are collateralised by
the related securities. Securities sold through repurchase agreements continue to be recognised in the balance
sheet and are revaluated in accordance with the applicable accounting policy. The amounts received from the
proceeds of these securities are considered as Deposits from customers and other funds or Deposits from credit
institutions and other funds. The difference between the acquisition/sale and reselling/repurchase conditions is
recognised on an accrual basis over the period of the transaction and is included in interest income or expenses.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRepurchaseAndReverseRepurchaseAgreementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-606": { "value": "Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities
substantially equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to
reselling agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in
loans and advances to customers or loans and advances to credit institutions. The receivables are collateralised by
the related securities. Securities sold through repurchase agreements continue to be recognised in the balance
sheet and are revaluated in accordance with the applicable accounting policy. The amounts received from the
proceeds of these securities are considered as Deposits from customers and other funds or Deposits from credit
institutions and other funds. The difference between the acquisition/sale and reselling/repurchase conditions is
recognised on an accrual basis over the period of the transaction and is included in interest income or expenses.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRepurchaseAndReverseRepurchaseAgreementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-610": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities
that include at least a non-current asset) and discontinued operations are classified as held for sale when the
intention is to sell the referred assets and liabilities and when the referred assets or group of assets are available
for immediate sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly
probable, in accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed
to a plan to sell the asset (or disposal group) and must have initiated an active program to locate a buyer and
complete the plan. In addition, the asset (or disposal group) must be actively marketed for sale at a price that is
reasonable in relation to its current fair value. Furthermore, it should be expected that the sale qualifies for
recognition as a completed sale within one year from the date of classification, except as permitted by paragraph
9 of IFRS 5, and that the Group remains committed to the asset sales plan and the delay is caused by events or
circumstances beyond its control.
If the requirements set out in IFRS 5 for these assets are not met, the balance sheet value and respective
impairment are reflected in the balance \"Other assets\".
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all
assets and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their
reclassification, these assets or disposal groups are measured at the lower of their cost and fair value less costs to
sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1. Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own
properties that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's
consolidation scope, whose capital or units acquired by the Group as a result of the recovery loans are treated as
INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing
on the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property,
net of estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do
Mercado de Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of
consolidating Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleAndDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-609": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities
that include at least a non-current asset) and discontinued operations are classified as held for sale when the
intention is to sell the referred assets and liabilities and when the referred assets or group of assets are available
for immediate sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly
probable, in accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed
to a plan to sell the asset (or disposal group) and must have initiated an active program to locate a buyer and
complete the plan. In addition, the asset (or disposal group) must be actively marketed for sale at a price that is
reasonable in relation to its current fair value. Furthermore, it should be expected that the sale qualifies for
recognition as a completed sale within one year from the date of classification, except as permitted by paragraph
9 of IFRS 5, and that the Group remains committed to the asset sales plan and the delay is caused by events or
circumstances beyond its control.
If the requirements set out in IFRS 5 for these assets are not met, the balance sheet value and respective
impairment are reflected in the balance \"Other assets\".
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all
assets and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their
reclassification, these assets or disposal groups are measured at the lower of their cost and fair value less costs to
sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1. Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own
properties that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's
consolidation scope, whose capital or units acquired by the Group as a result of the recovery loans are treated as
INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing
on the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property,
net of estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do
Mercado de Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of
consolidating Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-608": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities
that include at least a non-current asset) and discontinued operations are classified as held for sale when the
intention is to sell the referred assets and liabilities and when the referred assets or group of assets are available
for immediate sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly
probable, in accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed
to a plan to sell the asset (or disposal group) and must have initiated an active program to locate a buyer and
complete the plan. In addition, the asset (or disposal group) must be actively marketed for sale at a price that is
reasonable in relation to its current fair value. Furthermore, it should be expected that the sale qualifies for
recognition as a completed sale within one year from the date of classification, except as permitted by paragraph
9 of IFRS 5, and that the Group remains committed to the asset sales plan and the delay is caused by events or
circumstances beyond its control.
If the requirements set out in IFRS 5 for these assets are not met, the balance sheet value and respective
impairment are reflected in the balance \"Other assets\".
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all
assets and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their
reclassification, these assets or disposal groups are measured at the lower of their cost and fair value less costs to
sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1. Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own
properties that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's
consolidation scope, whose capital or units acquired by the Group as a result of the recovery loans are treated as
INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing
on the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property,
net of estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do
Mercado de Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of
consolidating Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-611": { "value": "
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same
is recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated
and an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The
recoverable amount is determined as the highest between the fair value less costs to sell and its value in use
calculated based on the present value of future cash flows estimated to be obtained from the continued use of
the asset and its sale at the end of the useful life. The impairment losses of the fixed tangible assets are recognised
in the income statement of the period.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfNonfinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-612": { "value": "Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of
leases:
\u2013 from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013 from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which
results in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the
lease term ends within 12 months or for those which the underlying asset is of low-value and, in these cases,
the lessee may opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments
associated with these leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below EUR 5,000. Additionally,
this standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or
contains a lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all
the economic benefits of using it, and the right to choose how to use the identified asset over a period in
exchange of a payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013 a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability
plus the value of payments made (fixed and/or variable), deducted from any lease incentives received,
penalties for terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the
lessee with the dismantling and removal of the underlying asset and/or with the recovery of its location.
Subsequently, it will be measured according to the cost model (subject to depreciations/amortisations and
impairment tests);
\u2013 a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013 fixed payments deducted from any lease incentives receivable;
\u2013 variable lease payments that depend on a rate or an index, initially measured considering the rate or
index as at the commencement date;
\u2013 amounts expected to be paid by the lessee under residual values guarantees;
\u2013 the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013 payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option
to end the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate
curve (swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract.
For term contracts, that date is considered as the end of lease date, while for contracts without term, or with
renewable terms, it is assessed using the date in which the contract is enforceable, as well as eventual economic
penalties associated with the lease contract. In the evaluation of enforceability, the particular clauses of the
contracts are considered, as well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013 by increasing their carrying amount to reflect interest;
\u2013 by reducing their carrying amount to reflect lease payments;
\u2013 carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the
review of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset)
whenever:
\u2013 the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which
case the lease liability is remeasured by discounting the revised lease payments using the revised discount
rate;
\u2013 the lease payments change due to changes in an index or rate or a change in expected payment under a
guaranteed residual value, in which cases the liability is remeasured by discounting the revised lease payments
using the initial discount rate (unless the lease payments change is due to a change in a floating interest rate,
in which case a revised discount rate is used);
\u2013 a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If
the lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group
expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the
underlying asset. The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013 in the consolidated income statement:
(i) recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii) recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii) recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013 in the consolidated balance sheet:
(i) recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of
financial assets related to sublease operations measured accordingly to IFRS 9;
(ii) recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii) recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013 in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013
Payments (cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to
lease contracts of low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in
other sundry liabilities and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019
capital portions, as detailed in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of
an underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and
rewards inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary,
and the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the
underlying asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
I.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForLeasesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-613": { "value": "Recognition of income from services and commissions
In accordance with IFRS 15, the Group recognises revenue associated with services and commissions when (or as)
a performance obligation is satisfied when transferring a service, based on the transaction price associated with
this performance obligation. In this context, the Group takes the following steps to recognise revenue associated
with services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the
service provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations
associated with each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also
considering the contractual terms established with the counterparty. According to this definition, a service is
transferred when the customer obtains the benefits and control associated with the service provided. In this
context, the Group also identifies whether performance obligations are met over time (\u201cover time\u201d) or at an exact
moment (\u201cpoint in time\u201d), with revenue being recognised accordingly.
- Measurement (price to be recognised associated with each performance obligation): (i) determine the
transaction price associated with the service provided, considering the contractual terms established with the
counterparty and its usual commercial practices. The transaction price is the amount of consideration to which
the Group expects to be entitled in exchange for transferring promised services to the customer, excluding
amounts collected on behalf of third parties. The Group includes in the transaction price part or all of the
estimated amount of the variable consideration associated with a performance obligation, only to the extent that
it is highly probable that a significant reversal in the amount of the accrued revenue recognised will not occur
when the uncertainty associated with that variable consideration is subsequently resolved; and (ii) allocate the
transaction price to each of the performance obligations identified under the contract established with the
customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a
financial instrument, income resulting from services and commissions is recorded in net interest income (note
C.3).
Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements.
Fees and commissions arising from this activity are recognised in the income statement in the period in which
they occur.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFeeAndCommissionIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-614": { "value": "Gains/(losses) on financial operations at fair value through profit or loss, Foreign
exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses)
arising from derecognition of financial assets and liabilities not measured at fair
value through profit or loss
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e.,
fair value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding
dividends received. This balance also includes the gains and losses on sale of financial assets at fair value through
other comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair
value of hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this
balance, as well as the foreign exchange gains or losses.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTradingIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-616": { "value": "Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses.
Subsequent costs are recognised as a separate asset only when it is probable that future economic benefits will
result for the Group. All other repairs and maintenance expenses are charged to the income statement during the
financial period in which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated
and an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The
recoverable amount is determined as the highest between the fair value less costs to sell and its value in use
calculated based on the present value of future cash flows estimated to be obtained from the continued use of
the asset and its sale at the end of the useful life. The impairment losses of the fixed tangible assets are recognised
in the income statement of the period.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDepreciationExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-615": { "value": "Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses.
Subsequent costs are recognised as a separate asset only when it is probable that future economic benefits will
result for the Group. All other repairs and maintenance expenses are charged to the income statement during the
financial period in which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated
and an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The
recoverable amount is determined as the highest between the fair value less costs to sell and its value in use
calculated based on the present value of future cash flows estimated to be obtained from the continued use of
the asset and its sale at the end of the useful life. The impairment losses of the fixed tangible assets are recognised
in the income statement of the period.
M.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForPropertyPlantAndEquipmentExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-617": { "value": "
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses.
Subsequent costs are recognised as a separate asset only when it is probable that future economic benefits will
result for the Group. All other repairs and maintenance expenses are charged to the income statement during the
financial period in which they are incurred, under the principle of accrual-based accounting.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRepairsAndMaintenanceExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-618": { "value": "
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
Amortisations and depreciations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Amortisations of intangible assets (note 30):
Software
43,019
35,632
Other intangible assets
7,529
7,043
50,548
42,675
Depreciations of other tangible assets (note 29):
Properties
14,537
14,769
Equipment
Computers
20,829
18,347
Security equipment
1,345
1,076
Indoor facilities
3,458
3,305
Machinery
1,515
1,682
Furniture
2,172
2,423
Vehicles
6,316
5,702
Other equipment
2,055
1,994
Right-of-use
Real estate
52,959
52,827
105,186
102,125
155,734
144,800
The changes occurred in Other tangible assets during 2025 are analysed as follows:
(Thousands of euros)
2025
Balance as at
1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Real estate
675,021
17
(6,270)
5,122
(8,892)
664,998
Equipment:
Computer equipment
321,858
13,717
(4,110)
7,663
(5,195)
333,933
Security equipment
63,919
574
(180)
1,526
(894)
64,945
Facilities
137,412
2,127
(354)
2,519
(2,161)
139,543
Machinery
47,297
430
(2,909)
1,560
(141)
46,237
Furniture
76,733
595
(921)
1,244
(816)
76,835
Vehicles
38,920
7,534
(5,578)
466
(1,170)
40,172
Other equipment
33,492
37
(5,685)
1,833
330
30,007
Right of use
Real estate
430,349
34,027
(8,805)
(1)
(2,297)
453,273
Assets under construction
28,846
27,923
(1,098)
(25,243)
(699)
29,729
Other tangible assets
15
\u2014
\u2014
\u2014
(4)
11
1,853,862
86,981
(35,910)
(3,311)
(21,939)
1,879,683
Accumulated depreciation
Real estate
(420,458)
(14,537)
4,079
1,529
2,802
(426,585)
Equipment:
Computer equipment
(253,376)
(20,829)
3,692
(125)
4,159
(266,479)
Security equipment
(59,879)
(1,345)
153
\u2014
634
(60,437)
Facilities
(120,356)
(3,458)
307
132
1,380
(121,995)
Machinery
(39,578)
(1,515)
1,904
(401)
84
(39,506)
Furniture
(72,796)
(2,172)
839
457
622
(73,050)
Vehicles
(19,690)
(6,316)
4,573
149
766
(20,518)
Other equipment
(26,773)
(2,055)
5,092
87
(256)
(23,905)
Right of use
Real estate
(221,605)
(52,959)
7,733
(170)
1,650
(265,351)
Other tangible assets
(12)
\u2014
\u2014
\u2014
1
(11)
(1,234,523)
(105,186)
28,372
1,658
11,842
(1,297,837)
619,339
(18,205)
(7,538)
(1,653)
(10,097)
581,846
The changes occurred in Other tangible assets during 2024 are analysed as follows:
(Thousands of euros)
2024
Balance as at
1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Real estate
669,847
92
(4,090)
2,584
6,588
675,021
Equipment:
Computer equipment
346,220
25,487
(62,528)
8,920
3,759
321,858
Security equipment
67,587
442
(5,124)
583
431
63,919
Facilities
151,649
617
(18,029)
2,085
1,090
137,412
Machinery
49,712
542
(5,107)
1,556
594
47,297
Furniture
84,154
539
(9,227)
848
419
76,733
Vehicles
35,839
9,099
(6,865)
\u2014
847
38,920
Other equipment
31,842
17
(714)
1,856
491
33,492
Right of use
Real estate
390,625
42,252
(6,819)
1
4,290
430,349
Assets under construction
20,563
31,888
(362)
(23,919)
676
28,846
Other tangible assets
36
\u2014
(24)
\u2014
3
15
1,848,074
110,975
(118,889)
(5,486)
19,188
1,853,862
Accumulated depreciation
Real estate
(410,455)
(14,769)
3,978
3,524
(2,736)
(420,458)
Equipment:
Computer equipment
(294,471)
(18,347)
62,336
(83)
(2,811)
(253,376)
Security equipment
(63,599)
(1,076)
5,116
\u2014
(320)
(59,879)
Facilities
(134,380)
(3,305)
17,970
66
(707)
(120,356)
Machinery
(42,015)
(1,682)
5,102
(539)
(444)
(39,578)
Furniture
(79,822)
(2,423)
9,196
576
(323)
(72,796)
Vehicles
(19,188)
(5,702)
5,723
8
(531)
(19,690)
Other equipment
(25,101)
(1,994)
705
\u2014
(383)
(26,773)
Right of use
Real estate
(172,560)
(52,827)
6,358
4
(2,580)
(221,605)
Other tangible assets
(36)
\u2014
24
\u2014
\u2014
(12)
(1,241,627)
(102,125)
116,508
3,556
(10,835)
(1,234,523)
606,447
8,850
(2,381)
(1,930)
8,353
619,339
The changes occurred in Goodwill and intangible assets, during 2025, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
167,491
\u2014
\u2014
\u2014
1,969
169,460
Impairment
(122,254)
\u2014
\u2014
\u2014
(1,434)
(123,688)
45,237
\u2014
\u2014
\u2014
535
45,772
Intangible assets
Software
291,642
25,757
(13,669)
50,689
(4,443)
349,976
Software - in progress
71,726
72,395
(325)
(60,746)
271
83,321
Other intangible assets
49,797
181
(955)
10,043
652
59,718
413,165
98,333
(14,949)
(14)
(3,520)
493,015
Accumulated amortisation
Software
(149,965)
(43,019)
13,636
140
2,892
(176,316)
Other intangible assets
(32,467)
(7,529)
769
(140)
(421)
(39,788)
(182,432)
(50,548)
14,405
\u2014
2,471
(216,104)
230,733
47,785
(544)
(14)
(1,049)
276,911
275,970
47,785
(544)
(14)
(514)
322,683
The changes occurred in Goodwill and intangible assets, during 2024, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
165,043
\u2014
\u2014
\u2014
2,448
167,491
Impairment
(120,520)
\u2014
\u2014
\u2014
(1,734)
(122,254)
44,523
\u2014
\u2014
\u2014
714
45,237
Intangible assets
Software
243,546
23,969
(27,523)
47,725
3,925
291,642
Software - in progress
66,230
69,410
(218)
(64,566)
870
71,726
Other intangible assets
80,598
\u2014
(48,783)
16,928
1,054
49,797
390,374
93,379
(76,524)
87
5,849
413,165
Accumulated amortisation
Software
(138,508)
(35,632)
26,919
44
(2,788)
(149,965)
Other intangible assets
(73,284)
(7,043)
48,783
(44)
(879)
(32,467)
(211,792)
(42,675)
75,702
\u2014
(3,667)
(182,432)
178,582
50,704
(822)
87
2,182
230,733
223,105
50,704
(822)
87
2,896
275,970
", "dimensions": { "concept": "ifrs-full:DisclosureOfDepreciationAndAmortisationExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-619": { "value": "Investment properties
Real estate properties owned by the Group are recognised as \u2018Investment properties\u2019 considering that the main
objective of these buildings is their capital appreciation on a long-term basis and not their sale in a short-term
period, nor their maintenance for own use.
These investments are initially recognised at their acquisition cost, including transaction costs, and subsequently
revaluated at their fair value. The fair value of investment properties should reflect the market conditions at the
balance sheet date. Changes in fair value are recognised in the income statement, as \"Other operating income/
(expenses)\" (note 6).
The experts responsible for the valuation of the assets are properly certified for that purpose, being registered in
CMVM.
N.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentPropertyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-620": { "value": "Intangible assets
N1. Research and development expenditure
The Group does not capitalise any research and development costs. All expenses are recognised as costs in the
period in which they occur.
N2. Software
The Group recognises as intangible assets the costs associated to software acquired from external entities and
depreciates them on a straight-line basis by an estimated lifetime of 6 years. The Group does not capitalise
internal costs arising from software development.
Whenever there is an indication that an intangible fixed asset may be impaired, an estimate of its recoverable
amount is made, and an impairment loss should be recognised whenever the net value of that asset exceeds its
recoverable amount. The recoverable amount is determined as the higher of its fair value less costs to sell and its
value in use, which is calculated based on the present value of the estimated future cash flows expected to be
obtained from the continued use of the asset and its disposal at the end of its useful life. Impairment losses on
intangible fixed assets are recognised in profit or loss for the period.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsOtherThanGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-621": { "value": "Research and development expenditure
The Group does not capitalise any research and development costs. All expenses are recognised as costs in the
period in which they occur.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForResearchAndDevelopmentExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-624": { "value": "Cash and cash equivalents
For the purposes of the cash flow statement, the balance \u201cCash and cash equivalents\u201d comprises balances with a
maturity of less than three months from the date of acquisition, where \"Cash\", \"Cash and deposits at Central
Banks\" and \"Loans and advances to credit institutions\" are included.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForCashFlowsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-623": { "value": "Cash and cash equivalents
For the purposes of the cash flow statement, the balance \u201cCash and cash equivalents\u201d comprises balances with a
maturity of less than three months from the date of acquisition, where \"Cash\", \"Cash and deposits at Central
Banks\" and \"Loans and advances to credit institutions\" are included.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyToDetermineComponentsOfCashAndCashEquivalents", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-622": { "value": "Cash and cash equivalents
For the purposes of the cash flow statement, the balance \u201cCash and cash equivalents\u201d comprises balances with a
maturity of less than three months from the date of acquisition, where \"Cash\", \"Cash and deposits at Central
Banks\" and \"Loans and advances to credit institutions\" are included.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRestrictedCashAndCashEquivalentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-625": { "value": "Offsetting
Financial assets and liabilities are offset and recognised at their net book value when: i) the Group has a legal right
to offset the amounts recognised and transactions can be settled at their net value; and, ii) the Group intends to
settle on a net basis or realize the asset and settle the liability simultaneously. Considering the current operations
of the Group, no compensation of material amount is made. In case of reclassification of comparative amounts,
the provisions of IAS 1.41 are disclosed: i) the nature of the reclassification; ii) the amount of each item (or class of
items) reclassified; and, iii) the reason for the reclassification.
Q.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForOffsettingOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-626": { "value": "Foreign currency transactions
Transactions in foreign currencies are converted into the respective functional currency of the operation at the
foreign exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are converted into the respective functional currency of the operation at the foreign exchange rate on
the reporting date. Foreign exchange differences arising from conversion are recognised in the income statement.
Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are
converted into the respective functional currency of the operation at the foreign exchange rate on the date of the
transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are
converted into the respective functional currency of the operation at the foreign exchange rate on the date that
the fair value was determined against profit and loss, except for financial assets at fair value through other
comprehensive income, for which the difference is recognised against equity.
R.
Closing exchange rates
Average exchange rates
Balance sheet
Income statement
Currency
2025
2024
2025
2024
AOA
1,086.3720
955.3050
1,039.0178
954.9984
BRL
6.4430
6.3942
6.2834
5.8558
CHF
0.9304
0.9382
0.9361
0.9514
MOP
9.4141
8.2838
9.4141
8.2838
MZN
75.0650
65.9290
71.9105
68.9735
PLN
4.2228
4.2767
4.2361
4.3048
USD
1.1743
1.0355
1.1262
1.0819
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForForeignCurrencyTranslationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-627": { "value": "Employee benefits
R1. Defined benefit plans
The Group has the responsibility to pay its employees' retirement pensions, invalidity pensions and survivor\u2019s
pensions for their death, in accordance with the terms of the two collective labour agreements approved. These
benefits are provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas
Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no.
54/2009, all employees were covered by the provisions of the social security chapter of the ACT, and for employees
who were already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July
2009, in accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements
to the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto
de Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January
2012. The plan was cut, and employees were given individual acquired rights. On that date, the Group also
proceeded to the settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now
covers their maternity, paternity, adoption and pension benefits. However, the banks remain liable for
benefits that concern illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the
employee, replacing the Banking Social Healthcare System which was extinguished by the decree law referred
above. As a consequence of this amendment the capability to receive pensions by the actual employees are
covered by the General Social Security Scheme regime, considering the service period between 1 January 2011 and
the retirement age. The banks support the remaining difference for the total pension assured in the Collective
Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to
be borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit
during the average lifetime of the pension until the normal retirement age is reached. The calculation of the
liability for pensions carried out periodically by the actuary considers this effect and is calculated considering the
actuarial assumptions in force, ensuring that the liabilities calculated as at 31 December 2010, not considering the
effect of the integration of bank employees into the General Social Security Scheme are fully covered and
deducted from the amount of the effect recognised until the date. The component of this effect for the year is
recognised under the heading \"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December,
an agreement was established between the Government, the Portuguese Banking Association and the Banking
Labour Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to
pensioners and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of
Collective Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in
pensions as well as any other complements, namely, contributions to the Health System (SAMS), death benefit
and death before retirement benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the
two union federations of the unions that represent the Group's employees, which introduced changes in the
Social Security clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new
ACT was published by the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and
the effects were recorded in the financial statements of 31 December 2016, for employees associated with these
four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the
new ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the
effects of this new ACT recorded in the financial statements as at 31 December 2017, for SBN associate employees.
The most relevant changes\u00a0 in the ACT were the change in the retirement age (presumed disability) from 65 years
to 66 years and two months in 2016 and the subsequent update of an additional month in each year, which
cannot, in any case, be higher than the one in force at any moment in the General Regime of Social Security, the
change in the formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new
benefit called the End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had
an impact on the present value of the liabilities with services rendered and were recognised in the income
statement for the year 2016 under \"Staff costs\".
In 2017, after the authorisation of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF -
Portuguese Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was
amended. The main purpose of the process was to incorporate into the pension fund the changes introduced in
the Group's ACT in terms of retirement benefits, as well as to transfer to the pension fund the responsibilities that
were directly chargeable to the company (extra-fund liabilities). The pension fund has a part exclusively for the
financing of these liabilities which, in the scope of the fund, is called Additional Complement. The End of Career
Premium also became the responsibility of the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year
basis on 31 December and 30 June of each year, and whenever there are significant market fluctuations or
significant specific events, such as changes in the plan, curtailments or settlements since the last estimation. The
responsibilities with past service are calculated using the Projected Unit Credit method and actuarial assumptions
considered adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately
for each plan by estimating the amount of future benefit that employees have earned in return for their service in
the current and prior periods. The benefit is discounted to determine its present value, using a discount rate
determined by reference to interest rates of high-quality corporate bonds that have maturity dates approximating
the terms of the Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of
the Pension Plan's assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability
with retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the
determination of the retirement pension liabilities. On this basis, the income/cost net of interest includes the
interest costs associated with retirement pension liabilities and the expected return of the plan's assets, both
measured based on the discount rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences
between actuarial assumptions used and the amounts actually observed (experienced gains and losses) and
changes in actuarial assumptions and (ii) gains and losses arising from the difference between the expected
return of the plan's assets and the amounts obtained, are recognised against equity under \"Other comprehensive
income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii)
the income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and,
(v) the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension
plan is recognised as interest and similar income or interest and similar\u00a0 expense depending on their nature. The
costs of early retirements correspond to the increase in liabilities due to the employee's retirement before
reaching the age of retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the
spouse and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific
contribution plan that ensures the solvency of the fund. In the end of each year, according to Banco de Portugal
Notice no. 12/2001, the minimum level required for the responsibilities funding must be 100% regarding pension
payments and 95% regarding past services of active employees.
R2. Revision of the salary tables for employees in service and pensions in payment
During 2025, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements,
for the conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, an increase of 2.50% was agreed on 2 January 2025 for salary tables and other pecuniary clauses
for the year 2025, with the unions: \u201cSBN \u2013 Sindicato dos Trabalhadores do Setor Financeiro de Portugal\u201d, \u201cSBC -
Sindicato Nacional dos Trabalhadores da Banca, Seguros e Tecnologias\u201d and \u201cSindicato da Banca, Seguros e
Tecnologias - MAIS SINDICATO\u201d, within the scope of the mediation process which took place at Government
Labour Minister Department \u201cDGERT \u2013 Dire\u00e7\u00e3o-Geral do Emprego e das Rela\u00e7\u00f5es de Trabalho\u201d, and according
with the proposal presented by this entity on 23 December 2024 to the parties under mediation.
Negotiations are still ongoing with the \u201cSIB \u2013 Sindicato Independente da Banca\u201d for the revision of salary tables
and other financial clauses for 2024 and 2025, as well as negotiations with the \u201cSindicato Nacional dos Quadros
T\u00e9cnicos Banc\u00e1rios (SNQTB)\u201d for the 2025 revision.
R3. Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees
are recognised as expenses when incurred.
As at 31 December 2025, the Group has two defined contribution plans. One plan covers employees who were
hired before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and
equal to 1% of the annual remuneration paid to covered employees in the previous year. Contributions shall only
be made if the following requirements are met: (i) the Bank's ROE equals or exceeds the rate of government
bonds of 10 years plus 5 percentage points, and (ii) distributable profits or reserves exist in the accounts of Banco
Comercial Portugu\u00eas. As in the year 2025 the indicated requirements were fulfilled a provision for the annual
contribution, which will be carried out in May 2026, was recorded in the 2025 costs.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the
current month, by the Group and by the employees. This contribution has a mandatory character and is defined in
the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4. Variable remuneration paid to employees
In the remuneration policy for employees in force, it is foreseen an annual variable remuneration system / profit
distribution for employees not covered by commercial incentive systems, which is based on the level of results
achieved by the Bank and the principle of discretion based on the level of responsibility and contribution of
everyone to the Bank's results. Based on this assessment, and provided that a Bank's minimum level of
performance, as measured by a set of quantitative indicators, is met, the amount of the variable remuneration to
be attributed to each employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the
respective allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to
employees is recorded against the income statement in the period to which it relates.
R5. Share-based compensation plan
As at 31 December 2025, a variable compensation plan / profit distribution with BCP shares is in force for the
members of the Executive Committee and for the employees considered Key Function Holders (includes Key
Management Members), resulting from the Remuneration Policy for Employees approved for the year 2025 and
the Remuneration Policy for members of the management and supervisory bodies approved for the fiscal year
2025 and following years, with the changes that may be approved in each financial year, namely by the General
Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the management and supervisory
bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to
the Board of Directors and the remaining employees whose professional activities have a significant impact on the
Bank's risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual
variable remuneration / profit distribution system is foreseen, which is based on the level of results achieved by the
Bank, and for which a discretion assessment of the performance of the Executive Committee is carried out on an
annual basis based on quantitative and qualitative data. According to this assessment and your annual fixed
remuneration, and provided that a Bank's minimum level of performance as measured by a set of quantitative
indicators is met, the amount of the variable remuneration to be attributed to each members of the Executive
Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in
the year following the financial year in question. For the members with variable remuneration awarded greater
than the fixed annual remuneration earned in the financial year in question, 60% of the amount must be deferred.
The amounts related to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The
number of BCP shares attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration / profit distribution system for
Employees not covered by Commercial Incentives Systems, which is based on the level of results achieved by the
Bank and the principle of discretion based on the level of responsibility and contribution of everyone to the Bank's
results. As a result of this assessment and the fixed reference remuneration for the function performed, and
provided that a Bank's minimum level of performance in a set of quantitative indicators is met, the value of the
variable remuneration to be attributed to each Employee is decided by the Executive Committee. For Employees
considered as Key Function Holders (KFH), the payment of the amount of the variable remuneration to be
attributed to each Employee is decided by the Nominations and Remunerations Committee, and its payment
subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year following the
financial year in question. For the KFH with variable remuneration awarded greater than the fixed annual
remuneration earned in the financial year in question, 60% of the amount must be deferred. The amounts related
to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The number of BCP shares
attributed and to be attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy. As provided for in the Remuneration Policy for Employees, if the amount of the annual
variable remuneration awarded to a Key Function Holder is less than EUR 50,000 and does not represent more
than one third of the total annual remuneration of the Key Function Holder the payment of the annual variable
remuneration will be 100% in cash and there will be no deferral.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable
remuneration amount awarded is fully paid in cash in the following year to which it relates.
For the members of the Executive Committee and to the Employees considered as Key Function Holders (KFH), a
long-term variable remuneration (LTVR) system is also foreseen, through which these members may receive
variable remuneration fully paid in BCP shares after the end of the assessment period, from 1 January 2022 until 31
December 2025 (from 1 January 2023 until 31 December 2025 to the Employees Key Function Holders), provided
that a certain level of performance is achieved in a set of long-term objectives. The amount of the long-term
variable remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value
paid in the year following the assessment period to which it relates. If the LTVR for each member of the Executive
Committee or KFH is equal to or greater than the Fixed Annual Remunerations due in the LTVR Assessment
Period, the deferred amount will correspond to 60%. The number of BCP shares attributed results from their
valuation at a price defined in accordance with the approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the
scope of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year
after their payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to
the Key Function Holders, regarding the proportion between its amount and the annual fixed remuneration, is
limited to the limits provided in the respective Remuneration Policy.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely
significant events, duly identified, in which the people covered have had a direct participation.
S. Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
forecasts, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
The discount rate used to update the Group's pension fund liabilities, regarding the defined benefit pension plans
of its employees and managers, was determined based on an analysis carried out on a set of available information,
which includes, among other elements, the market references for this indicator published by internationally
recognised specialised entities and which are based, as defined by IAS 19, on market yields of a universe of high
quality bond issues (low risk), different maturities, called in euro and relating to a diverse and representative range
of issuers (non-sovereign).
Y6.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEmployeeBenefitsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-629": { "value": "Share-based compensation plan
As at 31 December 2025, a variable compensation plan / profit distribution with BCP shares is in force for the
members of the Executive Committee and for the employees considered Key Function Holders (includes Key
Management Members), resulting from the Remuneration Policy for Employees approved for the year 2025 and
the Remuneration Policy for members of the management and supervisory bodies approved for the fiscal year
2025 and following years, with the changes that may be approved in each financial year, namely by the General
Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the management and supervisory
bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to
the Board of Directors and the remaining employees whose professional activities have a significant impact on the
Bank's risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual
variable remuneration / profit distribution system is foreseen, which is based on the level of results achieved by the
Bank, and for which a discretion assessment of the performance of the Executive Committee is carried out on an
annual basis based on quantitative and qualitative data. According to this assessment and your annual fixed
remuneration, and provided that a Bank's minimum level of performance as measured by a set of quantitative
indicators is met, the amount of the variable remuneration to be attributed to each members of the Executive
Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in
the year following the financial year in question. For the members with variable remuneration awarded greater
than the fixed annual remuneration earned in the financial year in question, 60% of the amount must be deferred.
The amounts related to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The
number of BCP shares attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration / profit distribution system for
Employees not covered by Commercial Incentives Systems, which is based on the level of results achieved by the
Bank and the principle of discretion based on the level of responsibility and contribution of everyone to the Bank's
results. As a result of this assessment and the fixed reference remuneration for the function performed, and
provided that a Bank's minimum level of performance in a set of quantitative indicators is met, the value of the
variable remuneration to be attributed to each Employee is decided by the Executive Committee. For Employees
considered as Key Function Holders (KFH), the payment of the amount of the variable remuneration to be
attributed to each Employee is decided by the Nominations and Remunerations Committee, and its payment
subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year following the
financial year in question. For the KFH with variable remuneration awarded greater than the fixed annual
remuneration earned in the financial year in question, 60% of the amount must be deferred. The amounts related
to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The number of BCP shares
attributed and to be attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy. As provided for in the Remuneration Policy for Employees, if the amount of the annual
variable remuneration awarded to a Key Function Holder is less than EUR 50,000 and does not represent more
than one third of the total annual remuneration of the Key Function Holder the payment of the annual variable
remuneration will be 100% in cash and there will be no deferral.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable
remuneration amount awarded is fully paid in cash in the following year to which it relates.
For the members of the Executive Committee and to the Employees considered as Key Function Holders (KFH), a
long-term variable remuneration (LTVR) system is also foreseen, through which these members may receive
variable remuneration fully paid in BCP shares after the end of the assessment period, from 1 January 2022 until 31
December 2025 (from 1 January 2023 until 31 December 2025 to the Employees Key Function Holders), provided
that a certain level of performance is achieved in a set of long-term objectives. The amount of the long-term
variable remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value
paid in the year following the assessment period to which it relates. If the LTVR for each member of the Executive
Committee or KFH is equal to or greater than the Fixed Annual Remunerations due in the LTVR Assessment
Period, the deferred amount will correspond to 60%. The number of BCP shares attributed results from their
valuation at a price defined in accordance with the approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the
scope of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year
after their payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to
the Key Function Holders, regarding the proportion between its amount and the annual fixed remuneration, is
limited to the limits provided in the respective Remuneration Policy.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely
significant events, duly identified, in which the people covered have had a direct participation.
S. Staff costs
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Remunerations
623,054
577,064
Mandatory social security charges
Post-employment benefits (note 51)
Service cost
(9,717)
(9,738)
Net interest cost / (income) in the liability coverage balance
(43)
(6,301)
Cost with early retirement programs
20,656
10,478
10,896
(5,561)
Other mandatory social security charges
134,634
125,818
145,530
120,257
Voluntary social security charges
12,094
14,635
Other staff costs
11,756
10,020
792,434
721,976
In 2025, the Group paid severance payments in the amount of EUR 3,823,000 (2024: EUR 4,431,000 ), of which the
highest amounted to EUR 230,000 (2024: EUR 381,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by
category:
2025
2024
Portugal
Top Management
884
881
Intermediary Management
1,435
1,449
Specific/Technical functions
2,897
2,926
Other functions
990
1,010
6,206
6,266
Abroad
9,459
9,310
15,665
15,576
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories
of employees provided for in Article 115-C (2) of the RGICS, as well as the information provided for in Article 450 (g)
to (i) of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial
Portugu\u00eas, S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2025
2024
2025
2024
Fixed remuneration
3,426
3,342
2,211
2,056
Variable remuneration
Pecuniary
576
692
\u2014
\u2014
Shares
729
856
\u2014
\u2014
Deferred
1,831
1,037
\u2014
\u2014
Supplementary retirement pension
764
669
227
222
Post-employment benefits
(35)
(16)
\u2014
\u2014
Other mandatory social security charges
822
802
441
455
8,113
7,382
2,879
2,733
Number of beneficiaries
6
6
12
10
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity
contract, intends to compensate the functions that are performed in the Group and in all other functions
performed in subsidiaries or governing bodies for which they have been designated by indication or in
representation of the Group, in the latter case, the net amount of the remuneration annually received by each
member of the Executive Committee will be deducted from the fixed annual remuneration attributed by the
Group, ensuring that the effective payable amount corresponds to the one approved by the Remuneration and
Welfare Board.
The amount of remuneration paid to the Executive Committee includes the amount of EUR 191,000 (2024: EUR
128,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was EUR 39,000 (2024: EUR 34,000).
In 2025 and 2024, variable remuneration was awarded as a result of the Remuneration Policies for the members of
the management and supervisory bodies and for employees, approved for 2024 and 2023, as described in
accounting policies 1 R4 and 1 R5.
In 2025, the variable remuneration attributed was EUR 1,440,000 in cash, (2024: EUR 1,384,000) of which EUR
864,000 are deferred for 5 years (2024: EUR 692,000), and 2,673,969 BCP shares (2024: 4,684,579 BCP shares)
corresponding to EUR 1,440,000 (2024: EUR 1,384,000), of which 1,604,381 BCP shares are deferred for 5 years (2024:
2,342,290 BCP shares).
In 2025, the deferred variable remuneration paid refers to the years 2018 to 2023 (2024: 2018 to 2022), of which EUR
251,000 in cash (2024: EUR 224,000) and 2,318,880 BCP shares (2024: 2,225,180 BCP shares) in the amount of EUR
1,580,000 (2024: EUR 813,000).
In 2025 and 2024, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
The remunerations and social security charges supported with the Group's Key Function Holders are, detailed by
segment, as follows:
(Thousands of euros)
Retail
Corporate
Control
functions
Other
Total
2025
2024
2025
2024
2025
2024
2025
2024
2025
2024
Fixed remuneration
1,199
1,253
2,120
2,456
2,942
2,982
5,978
5,350
12,239
12,041
Variable remuneration
Pecuniary
161
173
180
195
541
528
875
916
1,757
1,812
Shares
120
134
76
153
41
70
463
506
700
863
Deferred
117
62
89
72
53
37
512
252
771
423
Post-employment benefits
(65)
(82)
(43)
(55)
(128)
(140)
(183)
(221)
(419)
(498)
Other mandatory social
security charges
328
313
442
534
741
756
1,484
1,345
2,995
2,948
1,860
1,853
2,864
3,355
4,190
4,233
9,129
8,148
18,043
17,589
Number of beneficiaries
10
8
11
13
31
33
42
39
94
93
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2024 and
2023, as described in accounting policies 1 R4 and 1 R5, in 2025, the 94 Key Function Holders (KFH) (2024: 93 KFH)
were awarded with variable remuneration, in the amount of EUR 1,325,000 in cash (2024: EUR 487,000) and
2,455,037 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations were paid to KFH deferred from 2019 to 2023 (2024: 2019 to 2022)
corresponding in cash to EUR 227,000 (2024: EUR 164,000) and BCP shares in the amount of EUR 545,000 (2024:
EUR 258,000).
In 2025, severance payments were paid to 4 KFH (2024: 5 KFH) in the amount of EUR 565,000 (2024: EUR 915,000).
The highest payment was EUR 230,000 (2024: EUR 381,000).
In 2025, the end-of-career bonuses were paid in the amount of EUR 254,000 (2024: EUR 83,000).
The remunerations and social security charges supported with the Group's Key Function Holders, discriminated by
Key management personnel and by members whose professional activities have significant impact in the risk
profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management
personnel
Other KFH
Total
2025
2024
2025
2024
2025
2024
Fixed remuneration
9,023
7,887
3,216
4,155
12,239
12,042
Variable remuneration
Pecuniary
1,134
1,128
623
682
1,757
1,810
Shares
700
863
\u2014
\u2014
700
863
Deferred
765
415
6
7
771
422
Post-employment benefits
(248)
(296)
(171)
(200)
(419)
(496)
Other mandatory social security charges
2,179
1,979
816
968
2,995
2,947
13,553
11,976
4,490
5,612
18,043
17,588
Number of beneficiaries
58
53
36
40
94
93
In 2025, the Key management personnel were awarded with deferred variable remuneration in the amount of
EUR 461,000 (2024: EUR 487,000) and 850,656 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations from years 2019 to 2023 (2024: 2019 to 2022) were paid in cash to Key
management members, in the amount of EUR 225,000 (2024: EUR 161,000), as well as BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund corresponding to EUR 541,000 (2024: EUR 254,000).
Regarding the other KFH, were paid EUR 2,000 (2024: EUR 3,000) in cash deferred from 2019, BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund, from the years 2019, corresponding to EUR 5,000 (2024: EUR
4,000).
In accordance with regulation (EU) 11 575/2013, Article 450 (1)(i), in 2025 the Bank has 1 employee on the Board of
Directors with remuneration between EUR 1.5 million and EUR 2 million. In 2025 has 5 employees on the Board of
Directors with remuneration between EUR 1 million and EUR 1.5 million (2024: 3 employees).", "dimensions": { "concept": "ifrs-full:DisclosureOfSharebasedPaymentArrangementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-628": { "value": "Share-based compensation plan
As at 31 December 2025, a variable compensation plan / profit distribution with BCP shares is in force for the
members of the Executive Committee and for the employees considered Key Function Holders (includes Key
Management Members), resulting from the Remuneration Policy for Employees approved for the year 2025 and
the Remuneration Policy for members of the management and supervisory bodies approved for the fiscal year
2025 and following years, with the changes that may be approved in each financial year, namely by the General
Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the management and supervisory
bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to
the Board of Directors and the remaining employees whose professional activities have a significant impact on the
Bank's risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual
variable remuneration / profit distribution system is foreseen, which is based on the level of results achieved by the
Bank, and for which a discretion assessment of the performance of the Executive Committee is carried out on an
annual basis based on quantitative and qualitative data. According to this assessment and your annual fixed
remuneration, and provided that a Bank's minimum level of performance as measured by a set of quantitative
indicators is met, the amount of the variable remuneration to be attributed to each members of the Executive
Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in
the year following the financial year in question. For the members with variable remuneration awarded greater
than the fixed annual remuneration earned in the financial year in question, 60% of the amount must be deferred.
The amounts related to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The
number of BCP shares attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration / profit distribution system for
Employees not covered by Commercial Incentives Systems, which is based on the level of results achieved by the
Bank and the principle of discretion based on the level of responsibility and contribution of everyone to the Bank's
results. As a result of this assessment and the fixed reference remuneration for the function performed, and
provided that a Bank's minimum level of performance in a set of quantitative indicators is met, the value of the
variable remuneration to be attributed to each Employee is decided by the Executive Committee. For Employees
considered as Key Function Holders (KFH), the payment of the amount of the variable remuneration to be
attributed to each Employee is decided by the Nominations and Remunerations Committee, and its payment
subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year following the
financial year in question. For the KFH with variable remuneration awarded greater than the fixed annual
remuneration earned in the financial year in question, 60% of the amount must be deferred. The amounts related
to the non-deferred and deferred portion are paid 50% in cash and 50% in BCP shares. The number of BCP shares
attributed and to be attributed results from their valuation at a price defined in accordance with the approved
Remuneration Policy. As provided for in the Remuneration Policy for Employees, if the amount of the annual
variable remuneration awarded to a Key Function Holder is less than EUR 50,000 and does not represent more
than one third of the total annual remuneration of the Key Function Holder the payment of the annual variable
remuneration will be 100% in cash and there will be no deferral.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable
remuneration amount awarded is fully paid in cash in the following year to which it relates.
For the members of the Executive Committee and to the Employees considered as Key Function Holders (KFH), a
long-term variable remuneration (LTVR) system is also foreseen, through which these members may receive
variable remuneration fully paid in BCP shares after the end of the assessment period, from 1 January 2022 until 31
December 2025 (from 1 January 2023 until 31 December 2025 to the Employees Key Function Holders), provided
that a certain level of performance is achieved in a set of long-term objectives. The amount of the long-term
variable remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value
paid in the year following the assessment period to which it relates. If the LTVR for each member of the Executive
Committee or KFH is equal to or greater than the Fixed Annual Remunerations due in the LTVR Assessment
Period, the deferred amount will correspond to 60%. The number of BCP shares attributed results from their
valuation at a price defined in accordance with the approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the
scope of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year
after their payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to
the Key Function Holders, regarding the proportion between its amount and the annual fixed remuneration, is
limited to the limits provided in the respective Remuneration Policy.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely
significant events, duly identified, in which the people covered have had a direct participation.
S.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSharebasedPaymentTransactionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-631": { "value": "Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets
approved by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred
taxes relating to tax losses and to temporary differences between the accounting net income and the net income
accepted by the Tax Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable
probability that these taxes will be paid or recovered in the future.
Income tax recorded in net income for the year comprises current and deferred tax effects. Income tax is
recognised in the income statement, except when related to items recognised directly in equity, which implies its
recognition in equity. Deferred taxes arising from the revaluation of financial assets at fair value through other
comprehensive income and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are
recognised after in the income statement at the moment the profit and loss that originated the deferred taxes are
recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for
tax purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor
taxable profit and differences relating to investments in subsidiaries to the extent that probably they will not
reverse in the foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairment not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairment will be
deductible for the purposes of determining taxable income for the tax periods in which the legal conditions
required for their tax deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if:
(i) it has a legally enforceable right to offset current tax assets and current tax liabilities; and (ii) the deferred tax
assets and the deferred tax liabilities relate to income taxes released by the same Tax Authority on the same
taxable entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, not having occurred any material impact on the
Bank\u2019s financial statements resulting from its application.
In 2016, the Banco Comercial Portugu\u00eas adhered to the Special Tax Regime for Groups of Companies (RETGS) for
the purposes of corporate income (IRC) taxation, with BCP being the dominant entity. In the financial years of
2025 and 2024, RETGS application was maintained. The group's taxable profit is calculated by the algebraic sum of
taxable profits and individual tax losses of the companies that integrate it.
T.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDeferredIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-630": { "value": "Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets
approved by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred
taxes relating to tax losses and to temporary differences between the accounting net income and the net income
accepted by the Tax Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable
probability that these taxes will be paid or recovered in the future.
Income tax recorded in net income for the year comprises current and deferred tax effects. Income tax is
recognised in the income statement, except when related to items recognised directly in equity, which implies its
recognition in equity. Deferred taxes arising from the revaluation of financial assets at fair value through other
comprehensive income and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are
recognised after in the income statement at the moment the profit and loss that originated the deferred taxes are
recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for
tax purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor
taxable profit and differences relating to investments in subsidiaries to the extent that probably they will not
reverse in the foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairment not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairment will be
deductible for the purposes of determining taxable income for the tax periods in which the legal conditions
required for their tax deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if:
(i) it has a legally enforceable right to offset current tax assets and current tax liabilities; and (ii) the deferred tax
assets and the deferred tax liabilities relate to income taxes released by the same Tax Authority on the same
taxable entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, not having occurred any material impact on the
Bank\u2019s financial statements resulting from its application.
In 2016, the Banco Comercial Portugu\u00eas adhered to the Special Tax Regime for Groups of Companies (RETGS) for
the purposes of corporate income (IRC) taxation, with BCP being the dominant entity. In the financial years of
2025 and 2024, RETGS application was maintained. The group's taxable profit is calculated by the algebraic sum of
taxable profits and individual tax losses of the companies that integrate it.
T. Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax
determination is uncertain during the ordinary course of business. Different interpretations and estimations could
result in a different level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in
which the Group considers forecasts of future taxable income based on a set of assumptions, including the
estimate of income before taxes, adjustments to taxable income, evolution of tax legislation and its interpretation.
Thus, the recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors
strategy, namely the ability to generate the estimated taxable income, the evolution of tax law and its
interpretation.
Regarding the activity in Portugal, the Law no. 98/2019, of 4 September established the tax regime for credit
impairment and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
approximation between the accounting and tax rules for the purposes of deductibility of expenses with the
reinforcement of credit impairment. The rules in force until 2018 could continue to be applied until the end of the
2023 financial year, unless the option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis, recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and the impairment losses on debt instruments at amortised cost or at fair
value through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit,
with the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses
relating to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of
the Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
The Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still
not accepted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal no. 3/95, as amended before
its repeal by Notice of Banco de Portugal no. 5/2015, and, between other conditions, provided that they are not
credits covered by real estate rights.
Following the amendments provided for in Law no. 24-D/2022, of 30 December, within the scope of the State
Budget for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses went from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law no. 27-A/2020, of 24 July.
In the forecasts of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2025, the approximation between the accounting and tax rules
provided for in the aforementioned Law no. 98/2019, of 4 September, taking into account the option for applying
the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the use of
tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any tax losses deduction has
been made or tax credit has been used, in which the expiry period is the exercise of that right. The Group recorded
provisions, current tax liabilities or deferred taxes liabilities in the amount it considers appropriate to cover tax
corrections or tax losses incurred, as well as contingencies relating to years not yet reviewed by the tax authorities.
Y4.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-632": { "value": "Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by
geographic segments, breaking them down into their respective operating segments whenever deemed relevant.
A business segment is a Group's component: (i) which develops business activities that can obtain revenues or
expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking decisions
about allocating resources to the segment and assess its performance; and (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013 Retail Banking, also including ActivoBank;
\u2013 Companies and Corporate;
\u2013 Private Banking;
\u2013 Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralised management of financial investments, corporate activities, and insurance activity.
International activity:
\u2013 Poland:
\u2013 Retail;
\u2013 Companies and Corporate;
\u2013 Other.
\u2013 Mozambique;
\u2013 Other.
The contribution of the participation in the associate in Angola is included in the \"Other\" segment (International
activity).
U.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSegmentReportingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-633": { "value": "Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganisations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognised for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected
cost, the most likely result of current actions and considering the risks and uncertainties inherent to the process
result. On the cases that the discount effect is material, provision corresponds to the actual value of the expected
future payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted
through profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the
case that these obligations cease to exist.
Provisions for legal risk related to foreign currency-indexed mortgage loans (mostly to
Swiss franc)
The Group creates provisions for legal contingencies related foreign currency-indexed mortgage loans, mostly to
Swiss franc granted by Bank Millennium, S.A.
The assumptions used by Bank Millennium are essentially based on historical observations and will have to be
updated in subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The
methodology developed by Bank Millennium is based on the following parameters: (i) the number of ongoing
cases (including class action agreements) and potential future lawsuits; (ii)\u00a0 the amount of potential loss for Bank
Millennium in the event of a specific court judgment (including the estimate of statutory interest which
dependents significantly on the period to which it relates (iii) estimates involving judicial or out-of-court
settlements reached with customers.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the Swiss franc and
the amount of the Bank Millennium\u2019s actual losses depend, namely, on the number of ongoing and potential
lawsuits, as well as on the final court decisions about each case and amicable settlement with customers,
concluded in court or out of court.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForProvisionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-634": { "value": "Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow
of resources is probable.
U3. Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the
possibility of an outflow of resources regarding economic benefits are not remote. The Group records a contingent
liability when:
i) it is a possible obligation that arises from past events and whose existence will be confirmed only by the
occurrence or non- occurrence of one or more uncertain future events that are not wholly within the control of
the Group; or,
ii) it is a present obligation that arises from past events but is not recognised because:
a) it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b) the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForContingentLiabilitiesAndContingentAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-635": { "value": "Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares
purchased by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to
consider conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as
dilutive when their conversion to shares would decrease net earnings per share. If the earnings per share are
changed because of an issue with premium or discount or other event that changed the potential number of
ordinary shares or because of changes in the accounting policies, the earnings per share for all presented periods
should be adjusted retrospectively.
W.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEarningsPerShareExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-636": { "value": "Insurance contracts
W1. Classification
IFRS 17 is the new accounting standard for insurance contracts, reinsurance contracts and for Investment
contracts with discretionary participation features, covering aspects such as recognition and measurement,
presentation and disclosure of information, replacing IFRS 4 \u2013 Insurance contracts.
The Group issues contracts that include insurance risk, financial risk or a combination of both insurance and
financial risk. A contract, in which the Group accepts a significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance
contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in
accordance with the accounting policies applicable to insurance contracts. A contract issued by the Group that
transfers only financial risk, without discretionary participating features, is accounted for as a financial instrument.
W2. Recognition and measurement
IFRS 17 defines new principles for recognition, measurement, presentation and disclosure of insurance contracts,
reinsurance contracts and Investment contracts with discretionary participation features. The references below
apply to these three types of contracts.
In terms of recognition and measurement, insurance contracts are divided into portfolios, annual cohorts and
groups of contracts. In the initial recognition, contracts that have similar risk and can be managed together, must
be identified, grouping them into portfolios. For measurement purposes, these portfolios are further subdivided
into annual cohorts, according to the issuance year. Each of the cohorts, according to the expected future return,
is then divided into the following groups: i) contracts that are onerous at initial recognition; ii) contracts that do
not present a significant possibility of subsequently becoming onerous; and iii) remaining contracts in the
portfolio.
The liability of an insurance contract begins when one of the following conditions is met: i) beginning of the
coverage period of the contract, ii) date on which the first payment is made by the insured and this becomes due
or iii) in the case of an onerous contract, when it becomes onerous.
IFRS 17 defines 3 measurement models of the insurance liabilities: GMM (General Measurement Model) as a
general modal, VFA (Variable Fee Approach) to be applied for investment contracts, which does not include a
transfer of significant insurance risk and PAA (Premium Allocation Approach), which can be applied for short-term
contracts (less than 1 year).
The measurement of the value of a contract is the sum of (except where contracts are being measured using the
premium allocation approach): (i) the present value of future cash flows; (ii) a non-financial risk adjustment; and
the amount of future profit that is estimated that this contract will generate the Contractual Service Margin (CSM),
unless the contract group is onerous. In this case, the estimated loss is recognised immediately.
The liability for future services in contracts measured using the premium allocation approach is based on
premiums received, less amounts recognised in profit or loss already incurred in the period.
In terms of the discount rate for determining future cash flows, it should: (i) reflect the time value of money; ii) be
consistent with similar ones applied in the market for situations with similar characteristics and iii) exclude the
effect of factors that do not affect the future cash flows of the insurance contract.
In the subsequent valuation, the Statement of Financial Position shall include liabilities for insurance contracts,
divided into i) liabilities for future services and ii) liabilities for past services. In terms of the Income Statement, it
should include: i) income from insurance contracts, ii) expenses from insurance contracts and iii) losses from the
financial component of insurance contracts.
W3. Presentation and disclosures
In the Statement of Financial Position should appear in disaggregated form i) insurance contract assets, ii)
reinsurance ceded contract assets iii) insurance contracts liabilities and iv) reinsurance ceded contract liabilities.
In terms of the Income Statement, the following must be disclosed: i) income from insurance contracts, ii) expense
from insurance contracts, iii) losses from the financial component of insurance contracts, and iv) net result from
reinsurance contracts.
Together with the Financial Statements, the standard provides for additional qualitative and quantitative
disclosures of i) amounts recognised in the financial statements that fall within the scope of IFRS 17; ii) significant
judgements and changes to those judgements made with the application of IFRS 17 and iii) nature and extent of
the risks inherent in contracts that fall within the scope of IFRS 17.
For risks falling within the scope of IFRS 17, the entity shall analyse: (i) concentration risk, (ii) sensitivity analysis to
the most significant risks, (iii) claims development, (iv) credit risk and (v) liquidity risk.
X. Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorised by the Insurance and Pension Funds
Supervisory Authority (ASF - Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es) for the practice of the
activity of insurance mediation, in the category of tied Insurance Intermediary, in accordance with article 8(a)(i) of
Decree-Law no. 144/2006, of 31 July, developing the activity of insurance intermediation in the life and non-life
branches.
Within the scope of insurance mediation services, these Banks sell insurance contracts. As remuneration for the
services provided of insurance mediation, they receive commissions for the mediation of insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurers.
Commissions received by insurance mediation services are recognised in accordance with the accrual principle, so
that commissions received at a time other than the period to which it relates are recorded as receivables under
\"Other assets\". Commissions received for insurance mediation services are recognised in accordance with the
policy described in note I. Recognition of income from services and commissions.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDeferredAcquisitionCostsArisingFromInsuranceContractsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-637": { "value": "Presentation and disclosures
In the Statement of Financial Position should appear in disaggregated form i) insurance contract assets, ii)
reinsurance ceded contract assets iii) insurance contracts liabilities and iv) reinsurance ceded contract liabilities.
In terms of the Income Statement, the following must be disclosed: i) income from insurance contracts, ii) expense
from insurance contracts, iii) losses from the financial component of insurance contracts, and iv) net result from
reinsurance contracts.
Together with the Financial Statements, the standard provides for additional qualitative and quantitative
disclosures of i) amounts recognised in the financial statements that fall within the scope of IFRS 17; ii) significant
judgements and changes to those judgements made with the application of IFRS 17 and iii) nature and extent of
the risks inherent in contracts that fall within the scope of IFRS 17.
For risks falling within the scope of IFRS 17, the entity shall analyse: (i) concentration risk, (ii) sensitivity analysis to
the most significant risks, (iii) claims development, (iv) credit risk and (v) liquidity risk.
X. Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorised by the Insurance and Pension Funds
Supervisory Authority (ASF - Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es) for the practice of the
activity of insurance mediation, in the category of tied Insurance Intermediary, in accordance with article 8(a)(i) of
Decree-Law no. 144/2006, of 31 July, developing the activity of insurance intermediation in the life and non-life
branches.
Within the scope of insurance mediation services, these Banks sell insurance contracts. As remuneration for the
services provided of insurance mediation, they receive commissions for the mediation of insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurers.
Commissions received by insurance mediation services are recognised in accordance with the accrual principle, so
that commissions received at a time other than the period to which it relates are recorded as receivables under
\"Other assets\". Commissions received for insurance mediation services are recognised in accordance with the
policy described in note I. Recognition of income from services and commissions.
Y. Accounting estimates and judgements in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgements and to make estimations when deciding which treatment is the most
appropriate. These estimates were made considering the best information available at the date of preparation of
the consolidated financial statements, considering the context of uncertainty that results from the current
economic scope and the global geopolitical conflicts. The most significant of these accounting estimates and
judgements used when applying accounting principles are discussed in this section to improve understanding of
how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different
treatment was chosen. The Executive Committee believes that the choices made are appropriate and that the
financial statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1. Entities included in the consolidation scope
For the purposes of determining entities to include in the consolidation scope, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession
of these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by
the Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is
exposed to the variable returns and its ability to use its power to affect these returns. Different estimations and
assumptions could lead the Group to a different scope of consolidation scope with a direct impact in consolidated
income.
Y2. Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is
compared with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying
amount of the business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested.
Determining the cash flows to discount and the discount rate, involves judgment.
Y3. Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax
determination is uncertain during the ordinary course of business. Different interpretations and estimations could
result in a different level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in
which the Group considers forecasts of future taxable income based on a set of assumptions, including the
estimate of income before taxes, adjustments to taxable income, evolution of tax legislation and its interpretation.
Thus, the recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors
strategy, namely the ability to generate the estimated taxable income, the evolution of tax law and its
interpretation.
Regarding the activity in Portugal, the Law no. 98/2019, of 4 September established the tax regime for credit
impairment and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
approximation between the accounting and tax rules for the purposes of deductibility of expenses with the
reinforcement of credit impairment. The rules in force until 2018 could continue to be applied until the end of the
2023 financial year, unless the option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis, recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and the impairment losses on debt instruments at amortised cost or at fair
value through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit,
with the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses
relating to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of
the Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
The Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still
not accepted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal no. 3/95, as amended before
its repeal by Notice of Banco de Portugal no. 5/2015, and, between other conditions, provided that they are not
credits covered by real estate rights.
Following the amendments provided for in Law no. 24-D/2022, of 30 December, within the scope of the State
Budget for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses went from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law no. 27-A/2020, of 24 July.
In the forecasts of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2025, the approximation between the accounting and tax rules
provided for in the aforementioned Law no. 98/2019, of 4 September, taking into account the option for applying
the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the use of
tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any tax losses deduction has
been made or tax credit has been used, in which the expiry period is the exercise of that right. The Group recorded
provisions, current tax liabilities or deferred taxes liabilities in the amount it considers appropriate to cover tax
corrections or tax losses incurred, as well as contingencies relating to years not yet reviewed by the tax authorities.
Y4. Valuation of real estate recorded in Non-current assets held for sale and in Other assets
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Group's historical experience in the commercialisation\u00a0 of real estate, its perspectives on the
evolution of the real estate market and the intentions of the management body regarding the commercialisation\u00a0
of these assets. The assumptions used in the valuations of these assets have an impact on their valuation and
consequently on the determination of impairment.
Y5. Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
forecasts, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
The discount rate used to update the Group's pension fund liabilities, regarding the defined benefit pension plans
of its employees and managers, was determined based on an analysis carried out on a set of available information,
which includes, among other elements, the market references for this indicator published by internationally
recognised specialised entities and which are based, as defined by IAS 19, on market yields of a universe of high
quality bond issues (low risk), different maturities, called in euro and relating to a diverse and representative range
of issuers (non-sovereign).
Y6. Financial instruments \u2013 IFRS 9
Y6.1. Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and
interest on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed
together to achieve a specific business objective. This evaluation requires judgement, since the following aspects,
among others, must be considered: the way in which the performance of assets is evaluated; the risks that affect
the performance of the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other
comprehensive income that are derecognised prior to their maturity to understand the underlying reasons for
their disposal and to determine whether they are consistent with the purpose of the business model defined for
these assets. This monitoring is part of a process of continuous evaluation by the Group of the business model of
the financial assets that remain in the portfolio, to determine if it is adequate and, if it is not, if there was a change
in the business model and, consequently, a prospective classification change of these financial assets.
Y6.2. Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3. Fair value of financial instruments
Fair value is determined based on market quotations when available, or, in their absence, on the prices of recent
similar transactions carried out under market conditions or through valuation methodologies supported by
discounted cash flow techniques, taking into consideration factors such as market conditions, the time value, the
yield curve, and volatility. When these methodologies involve the use of significant unobservable inputs or
assumptions, the instruments are classified as Level 3 in the fair value hierarchy, in accordance with applicable
accounting standards (IFRS 13). The use of different methodologies, assumptions, or judgements may result in
outcomes that differ from those reported.
In market environments characterised by higher macroeconomic uncertainty, the Group may, among other
measures, reallocate risk limits and review both stress scenarios and the calculation of fair value adjustments.
Y7. Provisions for legal risk related to foreign currency-indexed mortgage loans (mostly to
Swiss franc)
The Group creates provisions for legal contingencies related foreign currency-indexed mortgage loans, mostly to
Swiss franc granted by Bank Millennium, S.A.
The assumptions used by Bank Millennium are essentially based on historical observations and will have to be
updated in subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The
methodology developed by Bank Millennium is based on the following parameters: (i) the number of ongoing
cases (including class action agreements) and potential future lawsuits; (ii)\u00a0 the amount of potential loss for Bank
Millennium in the event of a specific court judgment (including the estimate of statutory interest which
dependents significantly on the period to which it relates (iii) estimates involving judicial or out-of-court
settlements reached with customers.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the Swiss franc and
the amount of the Bank Millennium\u2019s actual losses depend, namely, on the number of ongoing and potential
lawsuits, as well as on the final court decisions about each case and amicable settlement with customers,
concluded in court or out of court.
\u00a0 \u00a0 Z. Subsequent events
The Group analyses events occurred after the balance sheet date, i.e., favourable and/or unfavourable events that
occur between the balance sheet date and the date the financial statements were authorised for issue. In this
context, two types of events can be identified:
i) those that provide evidence of conditions that existed at the balance sheet date (events after the balance
sheet date that give rise to adjustments); and,
ii) those that are indicative of the conditions that arose after the balance sheet date (events after the balance
sheet date that do not give rise to adjustments).
Events occurred after the date of the financial statements that are not considered as adjustable events, if
significant, are disclosed in the notes to the consolidated financial statements.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInsuranceContracts", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-638": { "value": "Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorised by the Insurance and Pension Funds
Supervisory Authority (ASF - Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es) for the practice of the
activity of insurance mediation, in the category of tied Insurance Intermediary, in accordance with article 8(a)(i) of
Decree-Law no. 144/2006, of 31 July, developing the activity of insurance intermediation in the life and non-life
branches.
Within the scope of insurance mediation services, these Banks sell insurance contracts. As remuneration for the
services provided of insurance mediation, they receive commissions for the mediation of insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurers.
Commissions received by insurance mediation services are recognised in accordance with the accrual principle, so
that commissions received at a time other than the period to which it relates are recorded as receivables under
\"Other assets\". Commissions received for insurance mediation services are recognised in accordance with the
policy described in note I. Recognition of income from services and commissions.
Y.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForReinsuranceExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-639": { "value": "Accounting estimates and judgements in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgements and to make estimations when deciding which treatment is the most
appropriate. These estimates were made considering the best information available at the date of preparation of
the consolidated financial statements, considering the context of uncertainty that results from the current
economic scope and the global geopolitical conflicts. The most significant of these accounting estimates and
judgements used when applying accounting principles are discussed in this section to improve understanding of
how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different
treatment was chosen. The Executive Committee believes that the choices made are appropriate and that the
financial statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1. Entities included in the consolidation scope
For the purposes of determining entities to include in the consolidation scope, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession
of these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by
the Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is
exposed to the variable returns and its ability to use its power to affect these returns. Different estimations and
assumptions could lead the Group to a different scope of consolidation scope with a direct impact in consolidated
income.
Y2. Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is
compared with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying
amount of the business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested.
Determining the cash flows to discount and the discount rate, involves judgment.
Y3. Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax
determination is uncertain during the ordinary course of business. Different interpretations and estimations could
result in a different level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in
which the Group considers forecasts of future taxable income based on a set of assumptions, including the
estimate of income before taxes, adjustments to taxable income, evolution of tax legislation and its interpretation.
Thus, the recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors
strategy, namely the ability to generate the estimated taxable income, the evolution of tax law and its
interpretation.
Regarding the activity in Portugal, the Law no. 98/2019, of 4 September established the tax regime for credit
impairment and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
approximation between the accounting and tax rules for the purposes of deductibility of expenses with the
reinforcement of credit impairment. The rules in force until 2018 could continue to be applied until the end of the
2023 financial year, unless the option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis, recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and the impairment losses on debt instruments at amortised cost or at fair
value through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit,
with the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses
relating to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of
the Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
The Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still
not accepted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal no. 3/95, as amended before
its repeal by Notice of Banco de Portugal no. 5/2015, and, between other conditions, provided that they are not
credits covered by real estate rights.
Following the amendments provided for in Law no. 24-D/2022, of 30 December, within the scope of the State
Budget for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses went from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law no. 27-A/2020, of 24 July.
In the forecasts of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2025, the approximation between the accounting and tax rules
provided for in the aforementioned Law no. 98/2019, of 4 September, taking into account the option for applying
the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the use of
tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any tax losses deduction has
been made or tax credit has been used, in which the expiry period is the exercise of that right. The Group recorded
provisions, current tax liabilities or deferred taxes liabilities in the amount it considers appropriate to cover tax
corrections or tax losses incurred, as well as contingencies relating to years not yet reviewed by the tax authorities.
Y4. Valuation of real estate recorded in Non-current assets held for sale and in Other assets
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Group's historical experience in the commercialisation\u00a0 of real estate, its perspectives on the
evolution of the real estate market and the intentions of the management body regarding the commercialisation\u00a0
of these assets. The assumptions used in the valuations of these assets have an impact on their valuation and
consequently on the determination of impairment.
Y5. Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
forecasts, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
The discount rate used to update the Group's pension fund liabilities, regarding the defined benefit pension plans
of its employees and managers, was determined based on an analysis carried out on a set of available information,
which includes, among other elements, the market references for this indicator published by internationally
recognised specialised entities and which are based, as defined by IAS 19, on market yields of a universe of high
quality bond issues (low risk), different maturities, called in euro and relating to a diverse and representative range
of issuers (non-sovereign).
Y6. Financial instruments \u2013 IFRS 9
Y6.1. Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and
interest on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed
together to achieve a specific business objective. This evaluation requires judgement, since the following aspects,
among others, must be considered: the way in which the performance of assets is evaluated; the risks that affect
the performance of the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other
comprehensive income that are derecognised prior to their maturity to understand the underlying reasons for
their disposal and to determine whether they are consistent with the purpose of the business model defined for
these assets. This monitoring is part of a process of continuous evaluation by the Group of the business model of
the financial assets that remain in the portfolio, to determine if it is adequate and, if it is not, if there was a change
in the business model and, consequently, a prospective classification change of these financial assets.
Y6.2. Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgements and estimations regarding,
among others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected
losses considering the probability of a default event occurring at some point up to the maturity date of the
instrument financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a
significant increase in its credit risk since its initial recognition. In assessing the existence of a significant increase
in credit risk, the Group considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the supervisors' guidelines, namely regarding to the identification and measuring credit
risk in the current context of uncertainty, largely associated with the worsening of the international geopolitical
context, the constraints in several relevant European economies (political instability, public budgetary pressures
and lower growth) and to the imposition of tariffs by the US on imports of goods from the E.U, the Group
proceeded to record additional impairment in relation to the current models of collective impairment calculation
(overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest
risk for Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to
assess whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in
the credit risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new
portfolios or in transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is
based on assumptions about the future evolution of different economic drivers and how each of the drivers
impacts the remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical
data, assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Group expects to receive, through the cash flows generated by the customers' business
or credit collaterals. The estimation of loss given default is based on, among other aspects, the different recovery
scenarios, historical information, the costs involved in the recovery process and the estimation of the valuation of
collaterals associated with credit operations.
Y6.3. Fair value of financial instruments
Fair value is determined based on market quotations when available, or, in their absence, on the prices of recent
similar transactions carried out under market conditions or through valuation methodologies supported by
discounted cash flow techniques, taking into consideration factors such as market conditions, the time value, the
yield curve, and volatility. When these methodologies involve the use of significant unobservable inputs or
assumptions, the instruments are classified as Level 3 in the fair value hierarchy, in accordance with applicable
accounting standards (IFRS 13). The use of different methodologies, assumptions, or judgements may result in
outcomes that differ from those reported.
In market environments characterised by higher macroeconomic uncertainty, the Group may, among other
measures, reallocate risk limits and review both stress scenarios and the calculation of fair value adjustments.
Y7. Provisions for legal risk related to foreign currency-indexed mortgage loans (mostly to
Swiss franc)
The Group creates provisions for legal contingencies related foreign currency-indexed mortgage loans, mostly to
Swiss franc granted by Bank Millennium, S.A.
The assumptions used by Bank Millennium are essentially based on historical observations and will have to be
updated in subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The
methodology developed by Bank Millennium is based on the following parameters: (i) the number of ongoing
cases (including class action agreements) and potential future lawsuits; (ii)\u00a0 the amount of potential loss for Bank
Millennium in the event of a specific court judgment (including the estimate of statutory interest which
dependents significantly on the period to which it relates (iii) estimates involving judicial or out-of-court
settlements reached with customers.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the Swiss franc and
the amount of the Bank Millennium\u2019s actual losses depend, namely, on the number of ongoing and potential
lawsuits, as well as on the final court decisions about each case and amicable settlement with customers,
concluded in court or out of court.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAccountingJudgementsAndEstimatesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-648": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Dividends from financial assets through other comprehensive income
803
1,016
803
1,016
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Fees and commissions received
Banking services provided
556,533
534,839
Management and maintenance of accounts
178,958
170,084
Bancassurance
143,030
140,655
Securities operations
58,911
51,459
From guarantees granted
46,508
47,011
From commitments to third parties
5,409
5,229
Management and intervention commissions
25,607
24,448
Other commissions
22,529
22,341
1,037,485
996,066
Fees and commissions paid
Banking services provided by third parties
(140,641)
(141,018)
Securities operations
(9,660)
(8,584)
From guarantees received
(4,412)
(5,988)
Bancassurance
(1,853)
(1,923)
Other commissions
(33,543)
(30,013)
(190,109)
(187,526)
847,376
808,540
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Gains / (losses) on financial assets and liabilities designated at fair value through profit or loss - Gains/
(Losses) - Certificates and structured securities issued record the valuations and devaluations of certificates issued
by the Group. These liabilities are covered by futures, which valuation and devaluation are recorded in Gains /
(losses) on financial assets held for trading - Gains/(Losses) - Derivative financial instruments and foreign exchange
transactions recorded under the balances \u201cForeign exchange gains/(losses)\u201d shown in the table below.
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-647": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Dividends from financial assets through other comprehensive income
803
1,016
803
1,016
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Gains / (losses) on financial assets and liabilities designated at fair value through profit or loss - Gains/
(Losses) - Certificates and structured securities issued record the valuations and devaluations of certificates issued
by the Group. These liabilities are covered by futures, which valuation and devaluation are recorded in Gains /
(losses) on financial assets held for trading - Gains/(Losses) - Derivative financial instruments and foreign exchange
transactions recorded under the balances \u201cForeign exchange gains/(losses)\u201d shown in the table below.
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
Other operating income / (expenses)
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
The balance Contribution on the Banking Sector in Portugal includes the estimated contributions according to
the terms of the Decree-Law no. 55-A/2010. The determination of the amount payable is based on: (i) the annual
average liabilities deducted by core capital (Tier 1) and supplementary capital (Tier 2) and deposits covered by the
Deposit Guarantee Fund, and (ii) notional amount of derivatives.
Following Constitutional Court Ruling 478/2025, issued on 3 June 2025, which declared the Solidarity Surcharge on
the Banking Sector (ASSB) unconstitutional with general binding force, the Group did not proceed with the self-
assessment and payment of the tax which, under the previously applicable rules, would have been due by 30 June
2025. Further to the favourable court decisions handed down in the legal challenges concerning the ASSB paid by
the Group in 2020, 2021 and 2022, and the respective final and unappealable rulings, as well as the reimbursement
of the amounts paid in the 2023 and 2024 financial years, income in the amount of EUR 30,434 thousand was
recognised in the 2025 financial year. The amount relating to the banking sector contribution in Portugal totalled
EUR 28,560 thousand.
The balance Contributions to Resolution Funds includes the periodic contributions that must be paid to the
Portuguese Fund, as stipulated in Decree-Law 24/2013. The periodic contributions are determined by a base rate,
established by the Banco de Portugal through regulatory instruments, to be applied in each year and which may
be adjusted to the credit institution\u2019s risk profile based on the objective incidence of those contributions. The
period contributions affect the liabilities of the credit institutions members of the Fund, as per the article 10 of the
referred Decree-Law, deducted from the liability elements that are part of the core capital and supplementary and
from the deposits covered by the Deposit Guarantee Fund.
The balance Contributions to Resolution Funds also includes the mandatory contributions made by Bank
Millennium, S.A to the Bank Guarantee Fund in Poland. The current principles of financing the deposit guarantee
system and resolution in Poland, as defined in the Act of 10 June 2016 on the Bank Guarantee Fund, deposit
guarantee system and forced restructuring, and are effective from 2017.
The method of calculating contributions regarding the resolution fund of banks in Poland was defined in the
Regulation (EU) 63/2015 (amended by Regulation (EU) 1434/2016), which applies directly to all European Union
countries. The contribution for a given year from each entity is calculated by BFG in accordance with this
regulation and the entity is notified by 1 May, each year.
The balance contribution to the Deposit Guarantee Fund, attributable to the Group (BCP and ActivoBank),
amounted to EUR 639,000 (2024: EUR 629,000), with the Group delivering the entire annual contribution to the
Deposit Guarantee Fund.
Up to and including 2011, inclusive, under the terms set out in Banco de Portugal Notice No. 11/94, the Bank could
choose to deliver part of the contribution to the Deposit Guarantee Fund and the other part to constitute an
irrevocable payment commitment. As a guarantee of the assumption of irrevocable payment commitments
assumed until 2012 with the Deposit Guarantee Fund, in the amount of EUR 95,190,000, a security pledge was
created for this purpose.
In 2025 and 2024, the Group (BCP and ActivoBank) maid payments of EUR 47,595,000, in each year,\u00a0 of irrevocable
payment commitments assumed until 2012, with the irrevocable commitment and the respective pledge of
securities no longer existing, in 2025 (note 46).
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceCostExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-646": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueFromContractsWithCustomersExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-645": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-644": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfBorrowingCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-643": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
The analysis of recovered loans and interest occurred during 2025 and 2024, by sector of activity, is as follows:
(Thousands of euros)
2025
2024
Agriculture and forestry
586
3
Food, beverage and tobacco
122
609
Textiles
40
23
Wood and cork
414
63
Chemicals
681
651
Machinery, equipment and basic metallurgical
53
49
Water
14
4
Construction
921
6,896
Retail business
260
826
Wholesale business
261
1,367
Restaurants and hotels
50
41
Transports
414
1,005
Post offices
2
1
Telecommunications
20
10
Services
Financial intermediation
2,765
68
Real estate activities
255
111
Consulting, scientific and technical activities
43
29
Administrative and support services activities
91
581
Health and collective service activities
10
30
Artistic, sports and recreational activities
6
1
Other services
5
504
Consumer loans
7,384
10,187
Mortgage loans
868
742
Other domestic activities
362
37
Other international activities
2,453
46,786
18,080
70,624
The analysis of recovered loans and interest occurred during 2025 and 2024, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Asset-backed loans
1,943
7,554
Other guaranteed loans
3,539
1,879
Unsecured loans
11,378
13,519
Foreign loans
381
46,684
Finance leases
839
988
18,080
70,624
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestIncomeExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-642": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Dividends from financial assets through other comprehensive income
803
1,016
803
1,016
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Fees and commissions received
Banking services provided
556,533
534,839
Management and maintenance of accounts
178,958
170,084
Bancassurance
143,030
140,655
Securities operations
58,911
51,459
From guarantees granted
46,508
47,011
From commitments to third parties
5,409
5,229
Management and intervention commissions
25,607
24,448
Other commissions
22,529
22,341
1,037,485
996,066
Fees and commissions paid
Banking services provided by third parties
(140,641)
(141,018)
Securities operations
(9,660)
(8,584)
From guarantees received
(4,412)
(5,988)
Bancassurance
(1,853)
(1,923)
Other commissions
(33,543)
(30,013)
(190,109)
(187,526)
847,376
808,540
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Gains / (losses) on financial assets and liabilities designated at fair value through profit or loss - Gains/
(Losses) - Certificates and structured securities issued record the valuations and devaluations of certificates issued
by the Group. These liabilities are covered by futures, which valuation and devaluation are recorded in Gains /
(losses) on financial assets held for trading - Gains/(Losses) - Derivative financial instruments and foreign exchange
transactions recorded under the balances \u201cForeign exchange gains/(losses)\u201d shown in the table below.
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
Other operating income / (expenses)
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
The balance Contribution on the Banking Sector in Portugal includes the estimated contributions according to
the terms of the Decree-Law no. 55-A/2010. The determination of the amount payable is based on: (i) the annual
average liabilities deducted by core capital (Tier 1) and supplementary capital (Tier 2) and deposits covered by the
Deposit Guarantee Fund, and (ii) notional amount of derivatives.
Following Constitutional Court Ruling 478/2025, issued on 3 June 2025, which declared the Solidarity Surcharge on
the Banking Sector (ASSB) unconstitutional with general binding force, the Group did not proceed with the self-
assessment and payment of the tax which, under the previously applicable rules, would have been due by 30 June
2025. Further to the favourable court decisions handed down in the legal challenges concerning the ASSB paid by
the Group in 2020, 2021 and 2022, and the respective final and unappealable rulings, as well as the reimbursement
of the amounts paid in the 2023 and 2024 financial years, income in the amount of EUR 30,434 thousand was
recognised in the 2025 financial year. The amount relating to the banking sector contribution in Portugal totalled
EUR 28,560 thousand.
The balance Contributions to Resolution Funds includes the periodic contributions that must be paid to the
Portuguese Fund, as stipulated in Decree-Law 24/2013. The periodic contributions are determined by a base rate,
established by the Banco de Portugal through regulatory instruments, to be applied in each year and which may
be adjusted to the credit institution\u2019s risk profile based on the objective incidence of those contributions. The
period contributions affect the liabilities of the credit institutions members of the Fund, as per the article 10 of the
referred Decree-Law, deducted from the liability elements that are part of the core capital and supplementary and
from the deposits covered by the Deposit Guarantee Fund.
The balance Contributions to Resolution Funds also includes the mandatory contributions made by Bank
Millennium, S.A to the Bank Guarantee Fund in Poland. The current principles of financing the deposit guarantee
system and resolution in Poland, as defined in the Act of 10 June 2016 on the Bank Guarantee Fund, deposit
guarantee system and forced restructuring, and are effective from 2017.
The method of calculating contributions regarding the resolution fund of banks in Poland was defined in the
Regulation (EU) 63/2015 (amended by Regulation (EU) 1434/2016), which applies directly to all European Union
countries. The contribution for a given year from each entity is calculated by BFG in accordance with this
regulation and the entity is notified by 1 May, each year.
The balance contribution to the Deposit Guarantee Fund, attributable to the Group (BCP and ActivoBank),
amounted to EUR 639,000 (2024: EUR 629,000), with the Group delivering the entire annual contribution to the
Deposit Guarantee Fund.
Up to and including 2011, inclusive, under the terms set out in Banco de Portugal Notice No. 11/94, the Bank could
choose to deliver part of the contribution to the Deposit Guarantee Fund and the other part to constitute an
irrevocable payment commitment. As a guarantee of the assumption of irrevocable payment commitments
assumed until 2012 with the Deposit Guarantee Fund, in the amount of EUR 95,190,000, a security pledge was
created for this purpose.
In 2025 and 2024, the Group (BCP and ActivoBank) maid payments of EUR 47,595,000, in each year,\u00a0 of irrevocable
payment commitments assumed until 2012, with the irrevocable commitment and the respective pledge of
securities no longer existing, in 2025 (note 46).
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-641": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-640": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
71,680
104,986
Interest on financial assets at amortised cost
Loans and advances to credit institutions
81,446
84,063
Loans and advances to customers
2,641,639
3,110,064
Debt securities
745,999
628,653
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
64,665
60,542
Financial assets not held for trading mandatorily at fair value through profit or loss
2,253
763
Financial assets designated at fair value through profit or loss
807
947
Interest on financial assets at fair value through other comprehensive income
605,313
506,553
Interest on hedging derivatives
150,833
200,195
Interest on other assets
14,582
19,068
4,379,217
4,715,834
Interest and similar expense
Interest on financial liabilities at amortised cost
Deposits from credit institutions and other funds
(41,153)
(47,734)
Deposits from customers and other funds
(963,172)
(1,164,608)
Non-subordinated debt securities issued
(200,942)
(179,391)
Subordinated debt
(82,213)
(82,713)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives
(21,332)
(45,731)
Financial liabilities designated at fair value through profit or loss
Deposits from customers and other funds
(29,850)
(19,250)
Non-subordinated debt securities issued
\u2014
(374)
Interest on hedging derivatives
(130,638)
(332,828)
Interest on leasing
(11,669)
(12,071)
Interest on other liabilities
(189)
(281)
(1,481,158)
(1,884,981)
2,898,059
2,830,853
The balance Interest and similar income - Interest on financial assets at amortised cost - Loans and advances to
customers includes the amount of EUR 42,310,000 (2024: EUR 103,148,000) related to commissions and other gains
accounted for under the effective interest method, as referred in the accounting policy described in note 1 C3. The
balance also includes the amount of EUR 69,706,000 (2024 : EUR 69,937,000) related to interest income arising
from customers classified in stage 3. \u00a0
The balance Interest and similar expense - Interest on non-subordinated debt securities issued and Interest on
subordinated debt include the amount of EUR 3,319,000 and EUR 799,000, respectively (2024: EUR 3,421,000 and
EUR 815,000, respectively) related to commissions and other costs accounted for under the effective interest
method, as referred in the accounting policy described in note 1 C3.
The balance Interest and similar expense - Interest on leasing refers to the interest cost related to the leasing
liabilities recognised under IFRS 16, as referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Dividends from financial assets through other comprehensive income
803
1,016
803
1,016
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Fees and commissions received
Banking services provided
556,533
534,839
Management and maintenance of accounts
178,958
170,084
Bancassurance
143,030
140,655
Securities operations
58,911
51,459
From guarantees granted
46,508
47,011
From commitments to third parties
5,409
5,229
Management and intervention commissions
25,607
24,448
Other commissions
22,529
22,341
1,037,485
996,066
Fees and commissions paid
Banking services provided by third parties
(140,641)
(141,018)
Securities operations
(9,660)
(8,584)
From guarantees received
(4,412)
(5,988)
Bancassurance
(1,853)
(1,923)
Other commissions
(33,543)
(30,013)
(190,109)
(187,526)
847,376
808,540
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Gains / (losses) on financial assets and liabilities designated at fair value through profit or loss - Gains/
(Losses) - Certificates and structured securities issued record the valuations and devaluations of certificates issued
by the Group. These liabilities are covered by futures, which valuation and devaluation are recorded in Gains /
(losses) on financial assets held for trading - Gains/(Losses) - Derivative financial instruments and foreign exchange
transactions recorded under the balances \u201cForeign exchange gains/(losses)\u201d shown in the table below.
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
Other operating income / (expenses)
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
The balance Contribution on the Banking Sector in Portugal includes the estimated contributions according to
the terms of the Decree-Law no. 55-A/2010. The determination of the amount payable is based on: (i) the annual
average liabilities deducted by core capital (Tier 1) and supplementary capital (Tier 2) and deposits covered by the
Deposit Guarantee Fund, and (ii) notional amount of derivatives.
Following Constitutional Court Ruling 478/2025, issued on 3 June 2025, which declared the Solidarity Surcharge on
the Banking Sector (ASSB) unconstitutional with general binding force, the Group did not proceed with the self-
assessment and payment of the tax which, under the previously applicable rules, would have been due by 30 June
2025. Further to the favourable court decisions handed down in the legal challenges concerning the ASSB paid by
the Group in 2020, 2021 and 2022, and the respective final and unappealable rulings, as well as the reimbursement
of the amounts paid in the 2023 and 2024 financial years, income in the amount of EUR 30,434 thousand was
recognised in the 2025 financial year. The amount relating to the banking sector contribution in Portugal totalled
EUR 28,560 thousand.
The balance Contributions to Resolution Funds includes the periodic contributions that must be paid to the
Portuguese Fund, as stipulated in Decree-Law 24/2013. The periodic contributions are determined by a base rate,
established by the Banco de Portugal through regulatory instruments, to be applied in each year and which may
be adjusted to the credit institution\u2019s risk profile based on the objective incidence of those contributions. The
period contributions affect the liabilities of the credit institutions members of the Fund, as per the article 10 of the
referred Decree-Law, deducted from the liability elements that are part of the core capital and supplementary and
from the deposits covered by the Deposit Guarantee Fund.
The balance Contributions to Resolution Funds also includes the mandatory contributions made by Bank
Millennium, S.A to the Bank Guarantee Fund in Poland. The current principles of financing the deposit guarantee
system and resolution in Poland, as defined in the Act of 10 June 2016 on the Bank Guarantee Fund, deposit
guarantee system and forced restructuring, and are effective from 2017.
The method of calculating contributions regarding the resolution fund of banks in Poland was defined in the
Regulation (EU) 63/2015 (amended by Regulation (EU) 1434/2016), which applies directly to all European Union
countries. The contribution for a given year from each entity is calculated by BFG in accordance with this
regulation and the entity is notified by 1 May, each year.
The balance contribution to the Deposit Guarantee Fund, attributable to the Group (BCP and ActivoBank),
amounted to EUR 639,000 (2024: EUR 629,000), with the Group delivering the entire annual contribution to the
Deposit Guarantee Fund.
Up to and including 2011, inclusive, under the terms set out in Banco de Portugal Notice No. 11/94, the Bank could
choose to deliver part of the contribution to the Deposit Guarantee Fund and the other part to constitute an
irrevocable payment commitment. As a guarantee of the assumption of irrevocable payment commitments
assumed until 2012 with the Deposit Guarantee Fund, in the amount of EUR 95,190,000, a security pledge was
created for this purpose.
In 2025 and 2024, the Group (BCP and ActivoBank) maid payments of EUR 47,595,000, in each year,\u00a0 of irrevocable
payment commitments assumed until 2012, with the irrevocable commitment and the respective pledge of
securities no longer existing, in 2025 (note 46).
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-649": { "value": "Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Dividends from financial assets through other comprehensive income
803
1,016
803
1,016
", "dimensions": { "concept": "ifrs-full:DisclosureOfDividendsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-650": { "value": "Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Fees and commissions received
Banking services provided
556,533
534,839
Management and maintenance of accounts
178,958
170,084
Bancassurance
143,030
140,655
Securities operations
58,911
51,459
From guarantees granted
46,508
47,011
From commitments to third parties
5,409
5,229
Management and intervention commissions
25,607
24,448
Other commissions
22,529
22,341
1,037,485
996,066
Fees and commissions paid
Banking services provided by third parties
(140,641)
(141,018)
Securities operations
(9,660)
(8,584)
From guarantees received
(4,412)
(5,988)
Bancassurance
(1,853)
(1,923)
Other commissions
(33,543)
(30,013)
(190,109)
(187,526)
847,376
808,540
", "dimensions": { "concept": "ifrs-full:DisclosureOfFeeAndCommissionIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-651": { "value": "Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Gains / (losses) on financial assets and liabilities designated at fair value through profit or loss - Gains/
(Losses) - Certificates and structured securities issued record the valuations and devaluations of certificates issued
by the Group. These liabilities are covered by futures, which valuation and devaluation are recorded in Gains /
(losses) on financial assets held for trading - Gains/(Losses) - Derivative financial instruments and foreign exchange
transactions recorded under the balances \u201cForeign exchange gains/(losses)\u201d shown in the table below.
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradingIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-652": { "value": "
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
175,490
155,978
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
(125,417)
(217,904)
66,485
(55,172)
Foreign exchange gains/(losses)
43,634
41,594
Gains/(losses) on hedge accounting
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
(10,245)
12,785
105,556
4,982
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
12,956
16,162
Equity instruments
17,966
28,349
Derivative financial instruments
1,323,651
695,312
Other operations
1,916
1,202
1,356,489
741,025
Losses
Debt securities portfolio
(6,735)
(9,688)
Equity instruments
(18,459)
(23,683)
Derivative financial instruments
(1,155,219)
(551,221)
Other operations
(586)
(455)
(1,180,999)
(585,047)
175,490
155,978
(continues)
(continuation)
(Thousands of euros)
2025
2024
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
297
1,510
Debt securities portfolio
27,895
23,013
Equity instruments
129,727
25,870
157,919
50,393
Losses
Loans and advances to customers
(160)
(1,337)
Debt securities portfolio
(29,134)
(27,185)
Equity instruments
(112,213)
(15,117)
(141,507)
(43,639)
16,412
6,754
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Debt securities portfolio
72
359
Deposits from customers and other funds
35,352
42,796
Debt securities issued
Certificates and structured securities issued
203,674
66,533
Other debt securities issued
\u2014
39
239,098
109,727
Losses
Debt securities portfolio
(161)
(477)
Deposits from customers and other funds
(46,631)
(43,132)
Debt securities issued
Certificates and structured securities issued
(317,724)
(275,037)
Other debt securities issued
1
(8,985)
(364,515)
(327,631)
(125,417)
(217,904)
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
3,148
187,868
252,096
\u2014
443,112
Foreign issuers
732,837
1,297,978
7,443,263
932,780
\u2014
10,406,858
Bonds issued by public companies
and other entities
Portuguese issuers
72,623
55,092
332,454
130,065
\u2014
590,234
Foreign issuers
9,899
36,264
795,296
675,264
\u2014
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
88,738
301,529
\u2014
\u2014
\u2014
390,267
Foreign issuers
3,038,576
420,773
\u2014
\u2014
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
6,109
6,109
Investment fund units
\u2014
2,141
216,382
\u2014
4,020
222,543
3,942,673
2,116,925
8,975,263
1,990,205
10,129
17,035,195
Equity instruments
Shares
Portuguese companies
39,288
39,288
Foreign companies
48,842
48,842
Investment fund units
67,258
67,258
Other securities
115,370
115,370
270,758
270,758
3,942,673
2,116,925
8,975,263
1,990,205
280,887
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
40,432
357,700
387,594
\u2014
785,726
Foreign issuers
298,761
1,296,334
5,572,040
633,740
\u2014
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
6,351
429,890
152,838
\u2014
589,079
Foreign issuers
23,400
72,236
860,960
425,130
\u2014
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
138,037
846,815
\u2014
\u2014
\u2014
984,852
Foreign issuers
2,231,512
391,990
\u2014
\u2014
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
15,189
15,189
Investment fund units
\u2014
6,756
177,676
32,471
4,203
221,106
2,691,710
2,660,914
7,398,266
1,631,773
19,392
14,402,055
Equity instruments
Shares
Portuguese companies
45,028
45,028
Foreign companies
26,464
26,464
Investment fund units
102,863
102,863
Other securities
87,563
87,563
261,918
261,918
2,691,710
2,660,914
7,398,266
1,631,773
281,310
14,663,973
The balance Loans to customers at fair value correspond essentially to consumer loans. This balance is analysed,
by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
7
4
3 months to 1 year
24
113
1 to 5 years
130
254
Undetermined
17
56
178
427
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
27
\u2014
27
Paper, printing and publishing
50,002
\u2014
\u2014
50,002
Chemicals
18,060
4
\u2014
18,064
Electricity and gas
210,888
\u2014
\u2014
210,888
Water
17,473
\u2014
\u2014
17,473
Construction
6,080
4
\u2014
6,084
Wholesale business
23,065
\u2014
\u2014
23,065
Transports
51,672
\u2014
\u2014
51,672
Telecommunications
69,784
4,670
\u2014
74,454
Services
\u00a0 Financial intermediation
3,959,419
62,694
405,171
4,427,284
\u00a0 Real estate activities
\u2014
20,341
\u2014
20,341
\u00a0 Consulting, scientific and technical activities
62,201
526
\u2014
62,727
\u00a0 Administrative and support services activities
19,886
5,949
\u2014
25,835
\u00a0 Public sector
49,594
\u2014
\u2014
49,594
\u00a0 Health and collective service activities
10,620
\u2014
\u2014
10,620
\u00a0 Other services
1,003
23
\u2014
1,026
Other international activities
\u2014
1
\u2014
1
4,549,747
94,239
405,171
5,049,157
Government and Public securities
12,256,796
\u2014
\u2014
12,256,796
16,806,543
94,239
405,171
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Agriculture and forestry
4,992
\u2014
\u2014
4,992
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
49,225
\u2014
\u2014
49,225
Chemicals
\u2014
5
\u2014
5
Machinery, equipment and basic metallurgical
\u2014
4
\u2014
4
Electricity and gas
181,356
\u2014
\u2014
181,356
Water
17,841
\u2014
\u2014
17,841
Construction
\u2014
3
\u2014
3
Wholesale business
7,192
320
\u2014
7,512
Transports
36,268
\u2014
\u2014
36,268
Telecommunications
43,126
4,413
\u2014
47,539
Services
Financial intermediation
3,569,543
46,281
410,948
4,026,772
Real estate activities
\u2014
\u2014
130
130
Consulting, scientific and technical activities
135,278
29,731
\u2014
165,009
Administrative and support services activities
19,669
5,895
\u2014
25,564
Public sector
49,415
\u2014
454
49,869
Health and collective service activities
10,642
\u2014
\u2014
10,642
Other services
\u2014
22
\u2014
22
Other international activities
\u2014
1
\u2014
1
4,124,547
86,681
411,532
4,622,760
Government and Public securities
10,041,213
\u2014
\u2014
10,041,213
14,165,760
86,681
411,532
14,663,973
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsAtFairValueThroughProfitOrLossExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-654": { "value": "
The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
Results on modification
The Group has accounted for in this balance a cost of EUR 5,320,000 (2024: cost of EUR 42,334,000) relating to
contractual modifications made in accordance with IFRS 9, namely those negotiated with customers holding
foreign currency-indexed mortgages loans in Poland, described in note 58, in the amount of EUR 2,499.000 (2024:
EUR 34,055,000).
In 2024, this balance also included a cost with credit holidays in the amount of EUR 26,182,000, following the
signing by the President of the Republic of Poland and announcement in the Journal of Laws of the Republic of
Poland of an Act of 12 April 2024 amending the existing Law on support for mortgage borrowers in challenging
financial situation and the Act on crowdfunding for business ventures and assistance to borrowers (\u2018the Act\u2019),
introducing, among other measures, an extension of credit holidays for PLN mortgage borrowers for further four
months in 2024.
Earnings per share
The earnings per share are calculated as follows:
(Thousands of euros)
2025
2024
Continuing operations
Net income from continuing operations
1,160,728
1,000,161
Non-controlling interests
(142,081)
(94,105)
Appropriated net income from continuing operations
1,018,647
906,056
Interests on perpetual subordinated bonds (Additional Tier 1)
(32,500)
(33,625)
Adjusted net income from continuing operations
986,147
872,431
Discontinued or discontinuing operations (note 17)
Net income from discontinued or discontinuing operations
\u2014
322
Adjusted net income
986,147
872,753
Average number of shares
14,938,596,848
15,113,989,952
Basic earnings per share (Euros)
0.066
0.058
Diluted earnings per share (Euros)
0.066
0.058
As at 31\u00a0December 2025, the Bank's share capital amounts to EUR 3,000,000,000 (2024: EUR 3,000,000,000) and is
represented by 14,804,627,089 (2024: 15,113,989,952) nominative book-entry shares without nominal value, fully
subscribed and paid up.
The calculation of the average number of shares as at 31\u00a0December 2025 (14,938,596,848 BCP shares) took into
account the repurchase of own shares that occurred in fiscal year of 2025 (309,362,863 BCP shares), which
programme is described in note 43.
There were not identified another dilution effects of the earnings per share as at 31\u00a0December 2025 and 2024, so
the diluted result is equivalent to the basic result.
Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Cash
668,685
666,175
Central Banks
Banco de Portugal
1,997,077
2,998,047
Central Banks abroad
1,423,778
1,924,808
4,089,540
5,589,030
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy
the legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective
liabilities. According to the European Central Bank System for Euro Zone, the cash reserve requirements establish
the maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other
liabilities, during each reserve requirement period. The rate is different for countries outside the Euro Zone.
According to the legislation of the Central Banks of Portugal, Poland, Mozambique and Monetary Authority of
Macao (AMCM), as at 31\u00a0December 2025, the minimum cash reserves are EUR 2,248,917,000 (31\u00a0December 2024:
EUR 2,365,095,000).
Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Credit institutions in Portugal
6,506
3,553
Credit institutions abroad
108,635
166,850
Amounts due for collection
70,870
80,754
186,011
251,157
The balance Amounts due for collection represents, essentially, cheques due for collection on other financial
institutions. These balances were settled in the first days of the following month.
Loans and advances to credit institutions
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Loans and advances to Central Banks
Central Banks abroad
373,122
273,212
373,122
273,212
Loans and advances to credit institutions in Portugal
\u00a0 Term deposits
1,927
1,913
\u00a0 Loans
10,005
\u2014
\u00a0 Other
1,817
537
13,749
2,450
Loans and advances to credit institutions abroad
\u00a0 Very short-term deposits
117,563
99,486
\u00a0 Term deposits
313,885
324,524
\u00a0 Loans
4,291
\u2014
\u00a0 Term deposits to collateralise CIRS and IRS operations (*)
25,833
38,909
\u00a0 Other
13,300
59,066
474,872
521,985
861,743
797,647
Impairment for loans and advances to credit institutions
(498)
(112)
861,245
797,535
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in the respective
contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred operations (IRS and CIRS), whose
revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2025
2024
Up to 3 months
819,520
696,834
3 to 6 months
17,897
70,225
6 to 12 months
10,068
30,588
1 to 5 years
14,258
\u2014
861,743
797,647
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
112
224
Transfers
\u2014
(3)
Charge for the year (note 11)
471
216
Reversals for the year (note 11)
(63)
(327)
Exchange rate differences
(22)
2
Balance at the end of the year
498
112
Loans and advances to customers
The analysis of loans and advances to customers, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Mortgage loans
31,337,755
29,582,285
Loans
17,600,936
16,292,820
Finance leases
4,514,157
4,336,809
Factoring operations
2,537,479
2,495,783
Current account credits
824,486
827,079
Overdrafts
1,163,242
1,109,387
Discounted bills
156,544
143,419
58,134,599
54,787,582
Overdue loans - less than 90 days
119,191
108,019
Overdue loans - Over 90 days
468,710
498,191
58,722,500
55,393,792
Loans impairment
(1,315,825)
(1,486,734)
57,406,675
53,907,058
The balance Loans and advances to customers, as at 31 December 2025, is analysed as follows:
(Thousands of euros)
2025
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
510,544
\u2014
510,544
(1,119)
509,425
Asset-backed loans
33,450,676
92,984
33,543,660
(330,915)
33,212,745
Other guaranteed loans
4,618,812
64,311
4,683,123
(141,805)
4,541,318
Unsecured loans
10,175,011
291,940
10,466,951
(654,129)
9,812,822
Foreign loans
2,327,920
2,488
2,330,408
(24,536)
2,305,872
Factoring operations
2,537,479
49,986
2,587,465
(70,689)
2,516,776
Finance leases
4,514,157
86,192
4,600,349
(92,632)
4,507,717
58,134,599
587,901
58,722,500
(1,315,825)
57,406,675
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees
considered:
\u2013 Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable
(income consignment);
\u2013 Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal
guarantees.
The balance Loans and advances to customers, as at 31 December 2024, is analysed as follows:
(Thousands of euros)
2024
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
521,599
\u2014
521,599
(436)
521,163
Asset-backed loans
32,126,373
93,095
32,219,468
(491,470)
31,727,998
Other guaranteed loans
4,193,856
82,648
4,276,504
(193,038)
4,083,466
Unsecured loans
8,856,725
280,818
9,137,543
(625,803)
8,511,740
Foreign loans
2,256,437
2,288
2,258,725
(16,463)
2,242,262
Factoring operations
2,495,783
47,383
2,543,166
(69,609)
2,473,557
Finance leases
4,336,809
99,978
4,436,787
(89,915)
4,346,872
54,787,582
606,210
55,393,792
(1,486,734)
53,907,058
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees
considered:
\u2013 Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable
(income consignment);
\u2013 Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal
guarantees.
The balance Loans and advances to customers includes the amount of EUR 13,414,544,000 (31\u00a0December 2024:
EUR 10,932,203,000) regarding mortgage loans assigned to the cover pool backing the Group\u2019s covered bond
programme issuances.
As part of the liquidity risk management, the Group holds a pool of eligible assets that can serve as collateral in
funding operations with the European Central Bank and other Central Banks in countries where the Group
operates, which include loans and advances to customers.
As referred in note 52, the Group provides loans and/or guarantees to qualifying shareholders holding individually
or together with their affiliates, 5% or more of the share capital identified in the Board of Directors report and in
note 41.
The Group granted credit to qualifying shareholders and entities controlled by them, in the amount of EUR
118,176,000 (31\u00a0December 2024: EUR 113,027,000), as referred in note 52 a). The amount of impairment recognised
for these contracts amounts to EUR 1,147,000 ( 31\u00a0December 2024: EUR 2,834,000).
The conclusion of business between the Company and holders of qualifying holdings or individuals or legal
entities related to them in accordance with the provisions of article 33, no. 3 of Notice 3/2020 of Banco de Portugal,
regardless of the amount, is always subject of consideration and deliberation by the Board of Directors, after
obtaining a prior opinion from the Audit Committee, and by proposal of the Executive Committee, which in turn
deliberates under proposal from the Credit Committee, after obtaining an analysis and opinion from the
Compliance Office, which pronounces regarding the compliance of the proposed operations with internal
regulations, legal and regulatory provisions and other conditions that may apply to them, and the Risk Office,
which evaluates and issues an opinion on the risks inherent to the operation.
According to accounting policy C.4, there is a set of loans and advances to customers that are being hedged, the
impact of which is detailed in note 55.
The analysis of the outstanding amount of financial lease contracts, by type of customer, is presented as follows:
(Thousands of euros)
2025
2024
Individuals
Home
28,449
31,458
Consumption
27,534
25,404
Other
64,920
70,233
120,903
127,095
Companies
Equipment
2,191,405
2,061,780
Real estate
2,201,849
2,147,934
4,393,254
4,209,714
4,514,157
4,336,809
The analysis of loans and advances to customers, as at 31\u00a0December 2025, by sector of activity, is as follows:
(Thousands of euros)
2025
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
373,520
7,804
381,324
(11,889)
369,435
0.65%
Fisheries
17,290
319
17,609
(930)
16,679
0.03%
Mining
61,021
1,557
62,578
(2,222)
60,356
0.11%
Food, beverage and tobacco
761,364
18,195
779,559
(39,446)
740,113
1.33%
Textiles
368,557
25,233
393,790
(47,124)
346,666
0.67%
Wood and cork
233,351
4,664
238,015
(8,439)
229,576
0.41%
Paper, printing and publishing
134,021
259
134,280
(2,033)
132,247
0.23%
Chemicals
724,701
11,278
735,979
(33,873)
702,106
1.25%
Machinery, equipment and basic
metallurgical
1,372,775
48,033
1,420,808
(66,160)
1,354,648
2.42%
Electricity and gas
421,050
217
421,267
(5,191)
416,076
0.72%
Water
196,120
1,928
198,048
(7,101)
190,947
0.34%
Construction
1,428,968
22,329
1,451,297
(48,860)
1,402,437
2.47%
Retail business
1,722,367
18,101
1,740,468
(40,212)
1,700,256
2.96%
Wholesale business
2,148,787
35,103
2,183,890
(63,937)
2,119,953
3.72%
Restaurants and hotels
1,225,499
6,026
1,231,525
(27,818)
1,203,707
2.10%
Transports
1,268,103
19,002
1,287,105
(36,369)
1,250,736
2.19%
Post offices
23,150
651
23,801
(1,087)
22,714
0.04%
Telecommunications
257,925
490
258,415
(4,469)
253,946
0.44%
Services
Financial intermediation
1,504,942
1,369
1,506,311
(28,308)
1,478,003
2.57%
Real estate activities
2,594,679
19,242
2,613,921
(74,022)
2,539,899
4.45%
Consulting, scientific and technical
activities
994,942
9,113
1,004,055
(35,743)
968,312
1.71%
Administrative and support services
activities
540,579
3,917
544,496
(11,890)
532,606
0.93%
Public sector
417,667
\u2014
417,667
(4,428)
413,239
0.71%
Education
124,500
708
125,208
(2,042)
123,166
0.21%
Health and collective service activities
425,219
1,289
426,508
(4,924)
421,584
0.73%
Artistic, sports and recreational
activities
188,418
1,396
189,814
(4,697)
185,117
0.32%
Other services
309,705
4,838
314,543
(62,057)
252,486
0.54%
Consumer loans
7,629,025
232,817
7,861,842
(430,534)
7,431,308
13.39%
Mortgage loans
30,256,455
91,485
30,347,940
(174,972)
30,172,968
51.68%
Other domestic activities
18,538
444
18,982
(379)
18,603
0.03%
Other international activities
391,361
94
391,455
(34,669)
356,786
0.67%
58,134,599
587,901
58,722,500
(1,315,825)
57,406,675
100%
The analysis of loans and advances to customers, as at 31\u00a0December 2024, by sector of activity, is as follows:
(Thousands of euros)
2024
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
390,267
10,196
400,463
(14,639)
385,824
0.72%
Fisheries
18,901
58
18,959
(957)
18,002
0.03%
Mining
52,001
3,078
55,079
(4,006)
51,073
0.10%
Food, beverage and tobacco
736,423
9,472
745,895
(37,592)
708,303
1.35%
Textiles
348,987
13,203
362,190
(32,943)
329,247
0.65%
Wood and cork
207,603
5,955
213,558
(8,137)
205,421
0.39%
Paper, printing and publishing
124,157
2,235
126,392
(3,305)
123,087
0.23%
Chemicals
666,093
7,331
673,424
(29,424)
644,000
1.22%
Machinery, equipment and basic
metallurgical
1,239,540
38,533
1,278,073
(54,854)
1,223,219
2.31%
Electricity and gas
248,088
394
248,482
(2,312)
246,170
0.45%
Water
193,309
600
193,909
(6,842)
187,067
0.35%
Construction
1,510,101
26,967
1,537,068
(99,662)
1,437,406
2.78%
Retail business
1,679,344
18,041
1,697,385
(37,302)
1,660,083
3.06%
Wholesale business
1,981,080
38,314
2,019,394
(57,474)
1,961,920
3.65%
Restaurants and hotels
1,283,189
12,426
1,295,615
(44,778)
1,250,837
2.34%
Transports
1,245,907
16,935
1,262,842
(34,216)
1,228,626
2.28%
Post offices
20,007
333
20,340
(699)
19,641
0.04%
Telecommunications
321,680
4,947
326,627
(13,091)
313,536
0.59%
Services
Financial intermediation
1,321,460
1,776
1,323,236
(29,438)
1,293,798
2.39%
Real estate activities
2,092,573
22,147
2,114,720
(48,264)
2,066,456
3.82%
Consulting, scientific and technical
activities
895,509
9,567
905,076
(165,174)
739,902
1.63%
Administrative and support services
activities
507,604
4,164
511,768
(19,388)
492,380
0.92%
Public sector
562,272
\u2014
562,272
(3,272)
559,000
1.02%
Education
106,513
483
106,996
(2,066)
104,930
0.19%
Health and collective service activities
377,299
2,298
379,597
(9,429)
370,168
0.69%
Artistic, sports and recreational
activities
179,520
745
180,265
(6,329)
173,936
0.33%
Other services
248,951
3,957
252,908
(68,290)
184,618
0.46%
Consumer loans
7,204,086
240,734
7,444,820
(454,045)
6,990,775
13.44%
Mortgage loans
28,625,742
108,450
28,734,192
(188,885)
28,545,307
51.87%
Other domestic activities
1,577
191
1,768
(197)
1,571
0.00%
Other international activities
397,799
2,680
400,479
(9,724)
390,755
0.72%
54,787,582
606,210
55,393,792
(1,486,734)
53,907,058
100%
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31\u00a0December 2025, is
as follows:
(Thousands of euros)
2025
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
91,017
150,858
131,645
373,520
7,804
381,324
Fisheries
3,777
9,311
4,202
17,290
319
17,609
Mining
15,150
34,525
11,346
61,021
1,557
62,578
Food, beverage and tobacco
361,323
296,932
103,109
761,364
18,195
779,559
Textiles
132,578
154,060
81,919
368,557
25,233
393,790
Wood and cork
85,184
106,134
42,033
233,351
4,664
238,015
Paper, printing and publishing
33,563
66,557
33,901
134,021
259
134,280
Chemicals
252,190
365,582
106,929
724,701
11,278
735,979
Machinery, equipment and basic
metallurgical
531,649
637,155
203,971
1,372,775
48,033
1,420,808
Electricity and gas
36,519
115,035
269,496
421,050
217
421,267
Water
33,823
96,898
65,399
196,120
1,928
198,048
Construction
555,775
667,683
205,510
1,428,968
22,329
1,451,297
Retail business
506,877
726,918
488,572
1,722,367
18,101
1,740,468
Wholesale business
953,301
936,989
258,497
2,148,787
35,103
2,183,890
Restaurants and hotels
106,613
383,310
735,576
1,225,499
6,026
1,231,525
Transports
376,908
721,311
169,884
1,268,103
19,002
1,287,105
Post offices
8,403
13,122
1,625
23,150
651
23,801
Telecommunications
43,139
189,800
24,986
257,925
490
258,415
Services
Financial intermediation
310,518
526,890
667,534
1,504,942
1,369
1,506,311
Real estate activities
660,309
1,038,255
896,115
2,594,679
19,242
2,613,921
Consulting, scientific and technical
activities
259,377
459,508
276,057
994,942
9,113
1,004,055
Administrative and support
services activities
188,632
269,014
82,933
540,579
3,917
544,496
Public sector
25,721
170,168
221,778
417,667
\u2014
417,667
Education
40,937
45,526
38,037
124,500
708
125,208
Health and collective service
activities
132,583
130,324
162,312
425,219
1,289
426,508
Artistic, sports and recreational
activities
19,139
61,666
107,613
188,418
1,396
189,814
Other services
82,870
147,898
78,937
309,705
4,838
314,543
Consumer loans
2,382,455
3,697,630
1,548,940
7,629,025
232,817
7,861,842
Mortgage loans
423,946
1,754,402
28,078,107
30,256,455
91,485
30,347,940
Other domestic activities
11,611
1,695
5,232
18,538
444
18,982
Other international activities
180,851
84,848
125,662
391,361
94
391,455
8,846,738
14,060,004
35,227,857
58,134,599
587,901
58,722,500
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31\u00a0December 2024, is
as follows:
(Thousands of euros)
2024
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
83,432
175,896
130,939
390,267
10,196
400,463
Fisheries
4,126
11,471
3,304
18,901
58
18,959
Mining
14,084
28,670
9,247
52,001
3,078
55,079
Food, beverage and tobacco
351,773
310,562
74,088
736,423
9,472
745,895
Textiles
140,668
162,480
45,839
348,987
13,203
362,190
Wood and cork
85,459
88,526
33,618
207,603
5,955
213,558
Paper, printing and publishing
39,110
62,218
22,829
124,157
2,235
126,392
Chemicals
276,551
303,817
85,725
666,093
7,331
673,424
Machinery, equipment and basic
metallurgical
510,535
585,320
143,685
1,239,540
38,533
1,278,073
Electricity and gas
66,491
50,573
131,024
248,088
394
248,482
Water
39,926
83,348
70,035
193,309
600
193,909
Construction
597,788
675,906
236,407
1,510,101
26,967
1,537,068
Retail business
772,527
572,145
334,672
1,679,344
18,041
1,697,385
Wholesale business
944,617
826,534
209,929
1,981,080
38,314
2,019,394
Restaurants and hotels
90,580
357,928
834,681
1,283,189
12,426
1,295,615
Transports
374,216
744,224
127,467
1,245,907
16,935
1,262,842
Post offices
8,544
9,948
1,515
20,007
333
20,340
Telecommunications
77,654
198,055
45,971
321,680
4,947
326,627
Services
Financial intermediation
207,920
372,553
740,987
1,321,460
1,776
1,323,236
Real estate activities
442,976
916,681
732,916
2,092,573
22,147
2,114,720
Consulting, scientific and technical
activities
185,479
324,862
385,168
895,509
9,567
905,076
Administrative and support
services activities
155,502
258,484
93,618
507,604
4,164
511,768
Public sector
24,434
277,019
260,819
562,272
\u2014
562,272
Education
29,858
44,722
31,933
106,513
483
106,996
Health and collective service
activities
112,921
130,721
133,657
377,299
2,298
379,597
Artistic, sports and recreational
activities
14,974
59,982
104,564
179,520
745
180,265
Other services
74,171
117,508
57,272
248,951
3,957
252,908
Consumer loans
2,314,106
3,452,244
1,437,736
7,204,086
240,734
7,444,820
Mortgage loans
445,257
1,811,390
26,369,095
28,625,742
108,450
28,734,192
Other domestic activities
311
696
570
1,577
191
1,768
Other international activities
168,999
73,789
155,011
397,799
2,680
400,479
8,654,989
13,088,272
33,044,321
54,787,582
606,210
55,393,792
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31\u00a0December 2025, is as
follows:
(Thousands of euros)
2025
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
15,025
166,064
329,455
510,544
\u2014
510,544
Asset-backed loans
1,696,895
3,805,816
27,947,965
33,450,676
92,984
33,543,660
Other guaranteed loans
949,292
2,725,172
944,348
4,618,812
64,311
4,683,123
Unsecured loans
3,381,991
4,813,354
1,979,666
10,175,011
291,940
10,466,951
Foreign loans
246,299
416,108
1,665,513
2,327,920
2,488
2,330,408
Factoring operations
1,892,717
502,982
141,780
2,537,479
49,986
2,587,465
Finance leases
664,519
1,630,508
2,219,130
4,514,157
86,192
4,600,349
8,846,738
14,060,004
35,227,857
58,134,599
587,901
58,722,500
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31\u00a0December 2024, is as
follows:
(Thousands of euros)
2024
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
11,036
163,898
346,665
521,599
\u2014
521,599
Asset-backed loans
1,732,962
3,764,716
26,628,695
32,126,373
93,095
32,219,468
Other guaranteed loans
820,367
2,778,203
595,286
4,193,856
82,648
4,276,504
Unsecured loans
3,049,654
4,082,487
1,724,584
8,856,725
280,818
9,137,543
Foreign loans
160,067
503,065
1,593,305
2,256,437
2,288
2,258,725
Factoring operations
2,259,044
236,739
\u2014
2,495,783
47,383
2,543,166
Finance leases
621,859
1,559,164
2,155,786
4,336,809
99,978
4,436,787
8,654,989
13,088,272
33,044,321
54,787,582
606,210
55,393,792
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2025
2024
Stage 1
Gross amount
50,874,014
46,683,551
Impairment
(252,249)
(240,621)
50,621,765
46,442,930
Stage 2
Gross amount
6,382,660
6,891,393
Impairment
(296,454)
(265,533)
6,086,206
6,625,860
Stage 3
Gross amount
1,465,826
1,818,847
Impairment
(767,122)
(980,579)
698,704
838,268
Net amount
57,406,675
53,907,058
The exposure and impairment of the above table also includes the operations classified as POCI as detailed in note
55.
The analysis of the exposure covered by collaterals associated with loans and advances to customers' portfolio, by
stage according with IFRS 9, considering the collaterals' fair value, is as follows:
(Thousands of euros)
2025
2024
Stage 1
Securities and other financial assets
1,349,916
1,413,424
Residential real estate
27,169,047
26,221,230
Other real estate
3,949,611
3,501,937
Other guarantees
8,881,118
8,632,995
41,349,692
39,769,586
Stage 2
Securities and other financial assets
130,311
179,566
Residential real estate
2,102,200
2,890,023
Other real estate
887,342
851,129
Other guarantees
1,549,444
1,266,171
4,669,297
5,186,889
Stage 3
Securities and other financial assets
12,647
17,158
Residential real estate
366,942
455,773
Other real estate
157,621
181,136
Other guarantees
265,994
275,656
803,204
929,723
46,822,193
45,886,198
The balance Other guarantees include first-demand guarantees issued by the Bank and other entities, with an
internal risk rating of 108 or better; personal guarantees, when the guarantors are classified with internal risk
grade 108 or better. This balance also includes pledges, assets subject to financial leasing operations and personal
guarantees, among others.
Considering the policy of risk management of the Group (note 55), the amounts presented do not include the fair
value of the personal guarantees provided by customers with lower risk rating. When considered, the fair value of
the personal guarantees corresponds to the guaranteed amount.
The Group is applying physical collaterals and financial guarantees as instruments to mitigate the credit risk. The
physical collaterals are mainly mortgages on residential buildings for the mortgage portfolio and other mortgages
on other types of buildings related to other types of loans. To reflect the market value, these collaterals are
regularly reviewed based on independent and certified valuation entities or through the application of revaluation
coefficients that reflect the market trends for each specific type of building and geographical area. The financial
guarantees are reviewed based on the market value of the respective assets, when available, with the subsequent
application of haircuts that reflect the volatility of their prices. The Group continued to negotiate additional
physical and financial collaterals with its customers.
The loans and advances to customers' portfolio includes contracts that resulted in a formal restructuring with the
customers and which arise to the marking of operations as being restructured due to financial difficulties of
customers. The restructuring may include in a reinforce of guarantees, liquidation of part of the credit and imply
an extension of maturities or changes in interest rate. The analysis of the restructured loans, by sector of activity, is
as follows:
(Thousands of euros)
2025
2024
Restructured
loans
Impairment
(*)
Net
amount
Restructured
loans
Impairment
(*)
Net
amount
Agriculture and forestry
11,301
(2,742)
8,559
10,656
(3,355)
7,301
Fisheries
5,390
(492)
4,898
540
(23)
517
Mining
574
(265)
309
2,421
(1,867)
554
Food, beverage and tobacco
15,118
(8,625)
6,493
12,299
(6,785)
5,514
Textiles
10,448
(2,627)
7,821
8,176
(2,318)
5,858
Wood and cork
5,555
(975)
4,580
3,688
(504)
3,184
Paper, printing and publishing
433
(77)
356
1,290
(953)
337
Chemicals
13,557
(8,126)
5,431
18,869
(7,813)
11,056
Machinery, equipment and basic
metallurgical
20,356
(6,985)
13,371
16,718
(5,461)
11,257
Electricity and gas
22,428
(545)
21,883
23,007
(325)
22,682
Water
493
(227)
266
247
(35)
212
Construction
14,978
(4,222)
10,756
61,430
(46,455)
14,975
Retail business
13,148
(1,941)
11,207
14,059
(2,479)
11,580
Wholesale business
28,443
(6,517)
21,926
30,457
(8,330)
22,127
Restaurants and hotels
16,954
(1,016)
15,938
117,672
(10,704)
106,968
Transports
6,539
(2,831)
3,708
5,334
(3,002)
2,332
Post offices
192
(157)
35
43
(13)
30
Telecommunications
379
(200)
179
4,213
(2,225)
1,988
Services
Financial intermediation
58,036
(14,262)
43,774
8,610
(328)
8,282
Real estate activities
48,690
(18,884)
29,806
56,397
(14,015)
42,382
Consulting, scientific and
technical activities
22,663
(3,611)
19,052
161,308
(132,149)
29,159
Administrative and support
services activities
11,231
(1,286)
9,945
26,654
(8,869)
17,785
Public sector
56,723
(867)
55,856
65,172
(753)
64,419
Education
2,509
(324)
2,185
1,661
(90)
1,571
Health and collective service
activities
2,651
(165)
2,486
7,589
(286)
7,303
Artistic, sports and recreational
activities
1,422
(1,058)
364
7,764
(2,070)
5,694
Other services
9,767
(783)
8,984
8,236
(1,192)
7,044
Consumer loans
205,302
(97,366)
107,936
257,104
(119,696)
137,408
Mortgage loans
460,854
(68,609)
392,245
573,978
(75,614)
498,364
Other domestic activities
1
\u2014
1
3
\u2014
3
Other international activities
230
(191)
39
340
(201)
139
1,066,365
(255,976)
810,389
1,505,935
(457,910)
1,048,025
(*) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in point
ii. of the section \"Additional measures with impact on the Impairment level\" of note 55.
The breakdown of the restructured loans as at 31\u00a0December 2025, by restructuring measure, is as follows:
(Thousands of euros)
2025
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
32,461
202,838
72,773
275,611
(110,585)
165,026
Introduction of the grace period for
capital and / or interest
6,348
233,472
21,628
255,100
(56,958)
198,142
Interest rate reduction
2,538
119,336
7,732
127,068
(24,171)
102,897
Payment plan change
5,921
127,638
7,187
134,825
(24,968)
109,857
Debt relief
18
205
387
592
(460)
132
Debt-asset swaps
2
15
14
29
(6)
23
Other restructured loans
5,612
254,249
18,891
273,140
(38,828)
234,312
52,900
937,753
128,612
1,066,365
(255,976)
810,389
The breakdown of the restructured loans as at 31\u00a0December 2024, by restructuring measure, is as follows:
(Thousands of euros)
2024
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
41,619
316,318
77,407
393,725
(133,152)
260,573
Introduction of the grace period for
capital and / or interest
6,811
287,481
33,107
320,588
(118,007)
202,581
Interest rate reduction
2,318
114,282
1,841
116,123
(8,155)
107,968
Payment plan change
6,930
296,183
9,248
305,431
(147,568)
157,863
Debt relief
31
450
480
930
(742)
188
Debt-asset swaps
3
18
15
33
(12)
21
Other restructured loans
5,088
341,437
27,668
369,105
(50,274)
318,831
62,800
1,356,169
149,766
1,505,935
(457,910)
1,048,025
(*) The impairment presented in the tables does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of note 55.
The restructured loans are also subject to an impairment analysis resulting from the revaluation of expectation to
meet new cash flows inherent to the new contract terms and considering new collaterals.
The Group has implemented a process for marking operations restructured due to customers' financial difficulties.
This marking is part of the credit analysis process, being in charge of the respective decision-making bodies,
according to the corresponding competencies, established in the regulations in force.
The information on operations restructured due to financial difficulties is available in the Group's information
systems, having a relevant role in the processes of credit analysis, in the marking of customers in default and in
the process of determining impairment. In particular:
- there are several default triggers related to restructuring due to financial difficulties (restructuring with loss of
value, recidivism of restructuring, default on customers with restructured operations);
- in the process of individual impairment analysis, in addition to the existence of operations restructured due to
financial difficulties, being a reason for customer selection, the loss inherent to the change in the conditions
resulting from the restructuring is determined.
An operation marked as restructured due to financial difficulties, can only be unmarked at least 2 years after the
date of marking, provided that a set of conditions exist that allow to conclude by the improvement of the financial
condition of the customer. In the case of credits marked as Non-Performing Exposure (NPE), this 2-year period will
only start on the date of classification of the credit as performing.
The definition of Non-Performing Loans for more than 90 days (NPL > 90) incorporates total credit (past due plus
outstanding) associated with past due operations for more than 90 days. The amount calculated is EUR
740,933,000 (31\u00a0December 2024: EUR 791,051,000).
All customers who check at least one of the following conditions are marked in default and therefore as NPE:
- Material payment delay of more than 90 days in the amounts of principal, interest or unpaid commissions on the
due date that, cumulatively, represent: more than EUR 100 (retail) or more than EUR 500 (non-retail); and more
than 1% of the total debt (direct liabilities).
- Indications of low probability of payment:
a) Credit restructuring due to financial difficulties with loss of value; b) Delay after restructuring due to financial
difficulties; c) Recurrence of restructuring due to financial difficulties; d) Credit with signs of impairment (or Stage
3 of IFRS 9); e) Insolvency or equivalent process; f) Litigation; g) Guarantees of operations in default; h) Loss of
credit sales; i) Credit fraud; j) Unpaid credit status; k) Breach of covenants in a credit agreement; l) Contagion of
default in an economic group; m) Cross default in the BCP Group.
The NPE associated with Loans and advances customers at amortised cost amounts to EUR 1,465,826,000
(31\u00a0December 2024: EUR 1,819,847,000).
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,486,734
1,582,650
Charge for the year in net income interest
24,584
37,861
Other transfers
(187,332)
(992)
Impairment charge for the year (note 11)
745,135
804,883
Reversals for the year (note 11)
(523,071)
(550,457)
Loans charged-off
Write-offs
(66,162)
(97,731)
Credit assignments
(168,289)
(301,290)
Exchange rate differences
4,226
11,810
Balance at the end of the year
1,315,825
1,486,734
According to note 39, regarding the proceedings related to foreign currency-indexed mortgages of Bank
Millennium the amount of EUR 869,230,000 has been written-off from the gross carrying amount of loans portfolio
(31\u00a0December 2024: EUR 1,324,672,000).
The analysis of Write-offs, by sector of activity, is as follows:
(Thousands of euros)
2025
2024
Agriculture and forestry
1,138
1,880
Fisheries
4
1
Mining
39
138
Food, beverage and tobacco
359
226
Textiles
785
363
Wood and cork
324
194
Paper, printing and publishing
858
75
Chemicals
1,617
374
Machinery, equipment and basic metallurgical
4,198
1,216
Electricity and gas
1
51
Water
226
49
Construction
4,741
3,922
Retail business
1,642
1,050
Wholesale business
4,174
3,211
Restaurants and hotels
1,805
5,848
Transports
4,328
2,101
Post offices
85
61
Telecommunications
12
1,090
Services
Financial intermediation
624
(15,097)
Real estate activities
4,134
1,130
Consulting, scientific and technical activities
581
23,911
Administrative and support services activities
488
(33,921)
Education
96
217
Health and collective service activities
343
165
Artistic, sports and recreational activities
38
5,525
Other services
1,144
4,575
Consumer loans
28,039
59,729
Mortgage loans
3,808
3,089
Other domestic activities
260
387
Other international activities
271
26,171
66,162
97,731
According to the accounting policy described in note 1 C1.3, the Group writes off a loan when it does not have
reasonable expectations of recovering a financial asset in its entirety or partially. Loans written-off are recognised
in off-balance sheet accounts.
The analysis of Write-offs, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Asset-backed loans
8,923
4,268
Other guaranteed loans
5,896
5,670
Unsecured loans
42,891
52,733
Foreign loans
\u2014
21,873
Finance leases
8,452
13,187
66,162
97,731
The analysis of recovered loans and interest occurred during 2025 and 2024, by sector of activity, is as follows:
(Thousands of euros)
2025
2024
Agriculture and forestry
586
3
Food, beverage and tobacco
122
609
Textiles
40
23
Wood and cork
414
63
Chemicals
681
651
Machinery, equipment and basic metallurgical
53
49
Water
14
4
Construction
921
6,896
Retail business
260
826
Wholesale business
261
1,367
Restaurants and hotels
50
41
Transports
414
1,005
Post offices
2
1
Telecommunications
20
10
Services
Financial intermediation
2,765
68
Real estate activities
255
111
Consulting, scientific and technical activities
43
29
Administrative and support services activities
91
581
Health and collective service activities
10
30
Artistic, sports and recreational activities
6
1
Other services
5
504
Consumer loans
7,384
10,187
Mortgage loans
868
742
Other domestic activities
362
37
Other international activities
2,453
46,786
18,080
70,624
The analysis of recovered loans and interest occurred during 2025 and 2024, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Asset-backed loans
1,943
7,554
Other guaranteed loans
3,539
1,879
Unsecured loans
11,378
13,519
Foreign loans
381
46,684
Finance leases
839
988
18,080
70,624
The balance Loans and advances to customers includes the effect of traditional securitisation transactions made
through Special Purpose Entities (SPE) consolidated following the application of IFRS 10, in accordance with
accounting policy 1 B and synthetic securitisation. The characterisation of these operations is described in note 1 D.
Traditional securitisations
The traditional securitisation transactions engaged by BCP and still ongoing, refer to mortgage loan portfolios and
were structured through securitisation funds and special purpose entities (SPEs). As referred in accounting policy 1
B, when the substance of the relationship with an\u00a0 SPE indicates that the Group holds control of its activities, such
entities are consolidated by the full method.
Magellan Mortgages No. 3
On 24 June 2005, the Bank transferred, through a securitisation fund, a mortgage loan portfolio to the SPE
\u201cMagellan Mortgages No. 3 PLC\u201d. Considering that, by having acquired part of the subordinated tranche of the
bonds issued by that SPE, the Bank holds\u00a0 control of the referred assets and so the SPE is consolidated in the
Group\u2019s Financial Statements, as established in the accounting policy 1.B.\u00a0 As at 31\u00a0December 2025, the SPE's credit
portfolio associated with this operation amounts to EUR 119,915,000 (31\u00a0December 2024: EUR 139,770,000) and
bonds issued with different subordination levels amount to EUR 91,743,000 (this amount excludes bonds held by
the Group in the amount of EUR 41,290,000) and the most subordinated tranche amounts to EUR 44,000 (this
amount excludes bonds already acquired by the Group in the amount EUR 206,000).
Synthetic securitisations
BCP has two transactions ongoing which form synthetic securitisation structures with similar characteristics, with
reference to credit portfolios granted by the Bank mainly to Small and Medium-sized Enterprises (SMEs), as refer
in accounting policy presented in note 1 D 2.
Caravela SME No.5
Caravela SME No.5, initiated on 20 December 2022, is supported by a portfolio of medium and long-term loans,
leasing contract and commercial paper programmes. The legal maturity date is 26 September of 2035 and, as at
31\u00a0December 2025, the transaction amounts to EUR 661,171,000 (31\u00a0December 2024: EUR 1,047,392,000). The fair
value of the relative CDS is recorded as a negative amount of EUR 8,538,000 (31\u00a0December 2024: negative amount
EUR 30,540,000) and a gain of EUR 1,497,000 was recognised in 2025 (31\u00a0December 2024: cost of EUR 14,839,000).
Caravela SME No.6
Caravela SME No. 6, initiated on 28 February 2024, is supported by a credit portfolio of short-term exposures to
Portuguese SME and Corporate customers, in the form of current accounts overdrafts, authorised overdrafts and
confirming agreements. The legal maturity date is 26 March of 2028 and the operation amounts to EUR
850,000,000 (31\u00a0December 2024: EUR 850,000,000). The fair value of the relative CDS is recorded as a negative
amount of EUR 13,665,000 (31\u00a0December 2024: negative amount of EUR 20,330,000) and a cost of EUR 7,948,000
was recognised in 2025 (31\u00a0December 2024: cost of EUR 7,107,000).
In both transactions, the Bank contracted a Credit Default Swap (CDS) with a Special Purpose Entity (SPE),
acquiring credit risk protection on the referenced portfolios. Within these synthetic structures, the credit risk of
the respective portfolios was subdivided into three tranches: senior, mezzanine and equity.\u00a0 The entire mezzanine
tranche has been placed on the market, while the Bank retained the risk of the senior and equity tranches. The
proceeds from the issuance of the Credit-Linked Notes (CLNs) were applied by each SPE in the constitution of a
deposit which fully collateralises its liabilities to its creditors in connection with each transaction, including the
Bank.
Within the scope of the active management of its synthetic securitisation structures, the Bank exercised the
contractual termination options in respect of Caravela SME No. 4 and Caravela SME No. 3, whose respective Credit
Default Swap (CDS) contracts were terminated on 22 December 2025 and 30 December 2025, respectively.
These transactions allowed the Bank to reduce the risk-weighted assets associated with the underlying credit
portfolios, but the Bank did not transfer to third parties most of the rights and obligations arising from the credits
included in the respective portfolios, thus not meeting the derecognition criteria in the accounting policy
presented in note 1 C1.3.
Debt securities
The balance Debt securities is analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Portuguese public issuers
Bonds
625,121
\u2014
Other Portuguese issuers
Bonds
835,421
93,734
Commercial paper
2,363,943
1,681,923
Foreign issuers
Commercial paper
43,710
26,224
3,868,195
1,801,881
Overdue securities - over 90 days
4,449
4,449
3,872,644
1,806,330
Impairment
(48,604)
(7,308)
3,824,040
1,799,022
Debt securities held not associated with credit operations
Bonds issued by public entities (*)
Portuguese issuers
1,326,262
3,135,453
Foreign issuers
19,041,663
15,228,401
Bonds issued by public companies and other entities
Portuguese issuers
\u2014
695,257
Foreign issuers
453,631
539,011
20,821,556
19,598,122
Impairment
(106,721)
(51,973)
20,714,835
19,546,149
24,538,875
21,345,171
( *) Includes the negative amount of EUR 247,549,000 (31\u00a0December 2024: negative amount of EUR 289,655,000) related to adjustments resulting from
the application of fair value hedge accounting.
In 2025, the Bank began to present a set of debt securities which, due to their characteristics, are associated with
credit operations of Portuguese public issuers amounting to EUR 436,256,000, and of Other Portuguese issuers
amounting to EUR 648,370,000.
Under the terms of IFRS 9, the balance Debt securities held associated with credit operations, includes financial
assets classified as loans and advances to customers granted in the form of subscription to issues of Commercial
Paper or Bonds of Corporate and Institutional customers.
Under the terms of IFRS 9, the balance Debt securities held not associated with credit operations - Bonds issued
by public issuers, includes essentially a portfolio of securities to support Group's ALM (Asset and Liability
Management), whose business model seeks to receive the respective income until maturity, that is, of a portfolio
Held to Collect, whose value as at 31\u00a0December 2025 amounts to EUR 13,874,625,000 (31\u00a0December 2024: EUR
12,213,890,000).
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
The analysis of the balance Debt securities before impairment, by maturity, as at 31\u00a0December 2025 is as follows:
(Thousands of euros)
2025
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese public issuers
Bonds
3,986
\u2014
97,741
523,394
\u2014
625,121
Other Portuguese issuers
\u00a0 Bonds
\u2014
\u2014
368,203
467,218
\u2014
835,421
\u00a0 Commercial paper
1,884,412
479,531
\u2014
\u2014
4,449
2,368,392
Foreign issuers
\u00a0 Commercial paper
22,037
21,673
\u2014
\u2014
\u2014
43,710
1,910,435
501,204
465,944
990,612
4,449
3,872,644
Debt securities held not associated
with credit operations
Public entities
\u00a0 Portuguese issuers
\u2014
\u2014
1,326,262
\u2014
\u2014
1,326,262
\u00a0 Foreign issuers
318,800
1,330,251
13,079,514
4,313,098
\u2014
19,041,663
Public companies and other entities
\u00a0 Foreign issuers
\u2014
\u2014
453,631
\u2014
\u2014
453,631
318,800
1,330,251
14,859,407
4,313,098
\u2014
20,821,556
2,229,235
1,831,455
15,325,351
5,303,710
4,449
24,694,200
The analysis of the balance Debt securities before impairment, by maturity, as at 31\u00a0December 2024 is as follows:
(Thousands of euros)
2024
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Other Portuguese issuers
Bonds
\u2014
1,396
10,109
82,229
\u2014
93,734
Commercial paper
1,106,015
575,908
\u2014
\u2014
4,449
1,686,372
Foreign issuers
Commercial paper
23,194
3,030
\u2014
\u2014
\u2014
26,224
1,129,209
580,334
10,109
82,229
4,449
1,806,330
Debt securities held not associated
with credit operations
Public entities
Portuguese issuers
\u2014
374,123
2,110,351
650,979
\u2014
3,135,453
Foreign issuers
30,361
1,273,287
10,230,020
3,694,733
\u2014
15,228,401
Public companies and other entities
Portuguese issuers
\u2014
\u2014
339,206
356,051
\u2014
695,257
Foreign issuers
\u2014
95,419
443,592
\u2014
\u2014
539,011
30,361
1,742,829
13,123,169
4,701,763
\u2014
19,598,122
1,159,570
2,323,163
13,133,278
4,783,992
4,449
21,404,452
The analysis of debt securities portfolio, by sector of activity, is analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Agriculture and forestry
7,487
2,484
Mining
94,879
98,541
Food, beverage and tobacco
168,617
118,851
Textiles
48,510
37,557
Wood and cork
21,366
25,811
Paper, printing and publishing
2,158
6,781
Chemicals
211,298
211,807
Machinery, equipment and basic metallurgical
114,080
67,948
Electricity and gas
385,465
201,886
Water
33,309
35,012
Construction
16,077
8,996
Retail business
45,468
40,359
Wholesale business
153,873
36,583
Restaurants and hotels
15,695
8,946
Transports
74,968
29,659
Services
\u00a0 \u00a0 Financial intermediation
456,163
124,411
\u00a0 \u00a0 Real estate activities
41,665
59,793
\u00a0 \u00a0 Consulting, scientific and technical activities
1,257,003
626,336
\u00a0 \u00a0 Administrative and support services activities
7,486
17,422
\u00a0 \u00a0 Health and collective service activities
3,851
4,960
\u00a0 \u00a0 Artistic, sports and recreational activities
12,352
6,618
\u00a0 \u00a0 Other services
\u2014
2,037
Other international activities
43,709
26,224
3,215,479
1,799,022
Government and Public securities
608,561
\u2014
3,824,040
1,799,022
Debt securities held not associated with credit operations
Machinery, equipment and basic metallurgical
\u2014
24,035
Electricity and gas
\u2014
100,225
Wholesale business
\u2014
100,170
Services
Financial intermediation
453,631
559,873
Consulting, scientific and technical activities
\u2014
447,813
453,631
1,232,116
Government and Public securities
20,261,204
18,314,033
20,714,835
19,546,149
24,538,875
21,345,171
The analysis of restructured debt securities portfolio, by sector of activity, is analysed as follows:
(Thousands of euros)
2025
2024
Restructured
loans
Impairment
Net
amount
Restructured
loans
Impairment
Net
amount
Debt securities held associated
with credit operations
Food, beverage and tobacco
8,422
(168)
8,254
9,279
(205)
9,074
Textiles
252
(17)
235
354
(17)
337
Chemicals
4,449
(4,412)
37
4,449
(3,234)
1,215
Services
Real estate activities
31,431
(29,384)
2,047
\u2014
\u2014
\u2014
Administrative and support
services activities
\u2014
\u2014
\u2014
10,007
(84)
9,923
44,554
(33,981)
10,573
24,089
(3,540)
20,549
The changes occurred in impairment of debt securities are analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Balance as at 1 January
7,308
8,668
Charge for the year in net income interest
548
48
Transfers
45,250
\u2014
Charge for the year (note 11)
1,287
1,691
Reversals for the year (note 11)
(5,788)
(3,099)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
48,604
7,308
Debt securities held not associated with credit operations
Balance as at 1 January
51,973
16,720
Other transfers
(3,429)
940
Charge for the year (note 11)
71,342
35,485
Reversals for the year (note 11)
(6,143)
(2,571)
Amounts charged-off
\u2014
(293)
Exchange rate differences
(7,022)
1,692
Balance at the end of the year
106,721
51,973
The balance Debt securities not associated to credit operations, includes a net reversal recorded at BIM - Banco
Internacional de Mo\u00e7ambique, S.A., in the amount of EUR 63,266,000 (31\u00a0December 2024: EUR 27,157,000),
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
Financial assets at fair value through profit or loss and financial assets at
fair value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred
in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial assets held for trading include bonds issued with different levels of subordination
associated with the traditional securitisation transactions Magellan Mortgages No. 4, referred in note 1 D, in the
amount of EUR 52,000 (31\u00a0December 2024 : EUR 59,000).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The accumulated impairment related to credit risk associated with the financial assets at fair value through other
comprehensive income amounts to EUR 21,062,000 and is recognised against Fair value reserves (31\u00a0December
2024: EUR 16,411,000).
The changes occurred in impairment of financial assets at fair value through other comprehensive income, are
analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,169
1,150
Transfers to fair value changes (note 44)
(6,101)
(10,213)
Impairment through profit and loss (note 12)
10,940
10,255
Reversals through profit and loss (note 12)
(4,839)
(42)
Exchange rate differences
14
19
Balance at the end of the year
1,183
1,169
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2025, is
analysed as follows:
(Thousands of euros)
2025
Amortised
cost (a)
Fair value
hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
487,459
(53,721)
2,226
435,964
Foreign issuers
10,147,142
11,942
52,427
10,211,511
Bonds issued by public companies and other entities
Portuguese issuers
583,555
1,183
5,496
590,234
Foreign issuers
1,514,511
(16,869)
18,005
1,515,647
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
3,258,392
\u2014
3,485
3,261,877
15,991,059
(57,465)
81,639
16,015,233
Equity instruments
Shares
Portuguese companies
24,069
\u2014
(5,452)
18,617
Foreign companies
6,522
\u2014
5,400
11,922
30,591
\u2014
(52)
30,539
16,021,650
(57,465)
81,587
16,045,772
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2024, is
analysed as follows:
(Thousands of euros)
2024
Amortised
cost (a)
Fair value hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
794,782
(42,290)
(12,114)
740,378
Foreign issuers
7,652,045
8,394
10,578
7,671,017
Bonds issued by public companies and other entities
Portuguese issuers
585,957
1,091
1,980
589,028
Foreign issuers
1,408,681
(22,191)
(5,126)
1,381,364
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
137,948
\u2014
107
138,055
Foreign issuers
2,347,811
\u2014
4,984
2,352,795
12,927,224
(54,996)
409
12,872,637
Equity instruments
Shares
Portuguese companies
21,288
\u2014
(5,821)
15,467
Foreign companies
6,092
\u2014
4,770
10,862
27,380
\u2014
(1,051)
26,329
12,954,604
(54,996)
(642)
12,898,966
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Debt instruments - Investment fund units classified as level 3, includes units in restructuring funds
(note 48) which book value resulted from the last disclosure of the Net Asset Value (NAV) determined by the
Management Company, which corresponds to the NAV with reference to that date, after considering the effects of
the last audited accounts for the respective funds. These funds have a diverse set of assets and liabilities, valued in
their respective accounts at fair value through internal methodologies used by the management company.
The instruments classified as level 3 have associated unrealised net gains in the amount of EUR 1,645,000
(31\u00a0December 2024: gains EUR 359,000) recorded in Other comprehensive income. The amount of impairment
created for these securities amounts to EUR 1,183,000 (31\u00a0December 2024: EUR 1,168,000).
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
3,148
187,868
252,096
\u2014
443,112
Foreign issuers
732,837
1,297,978
7,443,263
932,780
\u2014
10,406,858
Bonds issued by public companies
and other entities
Portuguese issuers
72,623
55,092
332,454
130,065
\u2014
590,234
Foreign issuers
9,899
36,264
795,296
675,264
\u2014
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
88,738
301,529
\u2014
\u2014
\u2014
390,267
Foreign issuers
3,038,576
420,773
\u2014
\u2014
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
6,109
6,109
Investment fund units
\u2014
2,141
216,382
\u2014
4,020
222,543
3,942,673
2,116,925
8,975,263
1,990,205
10,129
17,035,195
Equity instruments
Shares
Portuguese companies
39,288
39,288
Foreign companies
48,842
48,842
Investment fund units
67,258
67,258
Other securities
115,370
115,370
270,758
270,758
3,942,673
2,116,925
8,975,263
1,990,205
280,887
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
40,432
357,700
387,594
\u2014
785,726
Foreign issuers
298,761
1,296,334
5,572,040
633,740
\u2014
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
6,351
429,890
152,838
\u2014
589,079
Foreign issuers
23,400
72,236
860,960
425,130
\u2014
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
138,037
846,815
\u2014
\u2014
\u2014
984,852
Foreign issuers
2,231,512
391,990
\u2014
\u2014
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
15,189
15,189
Investment fund units
\u2014
6,756
177,676
32,471
4,203
221,106
2,691,710
2,660,914
7,398,266
1,631,773
19,392
14,402,055
Equity instruments
Shares
Portuguese companies
45,028
45,028
Foreign companies
26,464
26,464
Investment fund units
102,863
102,863
Other securities
87,563
87,563
261,918
261,918
2,691,710
2,660,914
7,398,266
1,631,773
281,310
14,663,973
The balance Loans to customers at fair value correspond essentially to consumer loans. This balance is analysed,
by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
7
4
3 months to 1 year
24
113
1 to 5 years
130
254
Undetermined
17
56
178
427
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
27
\u2014
27
Paper, printing and publishing
50,002
\u2014
\u2014
50,002
Chemicals
18,060
4
\u2014
18,064
Electricity and gas
210,888
\u2014
\u2014
210,888
Water
17,473
\u2014
\u2014
17,473
Construction
6,080
4
\u2014
6,084
Wholesale business
23,065
\u2014
\u2014
23,065
Transports
51,672
\u2014
\u2014
51,672
Telecommunications
69,784
4,670
\u2014
74,454
Services
\u00a0 Financial intermediation
3,959,419
62,694
405,171
4,427,284
\u00a0 Real estate activities
\u2014
20,341
\u2014
20,341
\u00a0 Consulting, scientific and technical activities
62,201
526
\u2014
62,727
\u00a0 Administrative and support services activities
19,886
5,949
\u2014
25,835
\u00a0 Public sector
49,594
\u2014
\u2014
49,594
\u00a0 Health and collective service activities
10,620
\u2014
\u2014
10,620
\u00a0 Other services
1,003
23
\u2014
1,026
Other international activities
\u2014
1
\u2014
1
4,549,747
94,239
405,171
5,049,157
Government and Public securities
12,256,796
\u2014
\u2014
12,256,796
16,806,543
94,239
405,171
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Agriculture and forestry
4,992
\u2014
\u2014
4,992
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
49,225
\u2014
\u2014
49,225
Chemicals
\u2014
5
\u2014
5
Machinery, equipment and basic metallurgical
\u2014
4
\u2014
4
Electricity and gas
181,356
\u2014
\u2014
181,356
Water
17,841
\u2014
\u2014
17,841
Construction
\u2014
3
\u2014
3
Wholesale business
7,192
320
\u2014
7,512
Transports
36,268
\u2014
\u2014
36,268
Telecommunications
43,126
4,413
\u2014
47,539
Services
Financial intermediation
3,569,543
46,281
410,948
4,026,772
Real estate activities
\u2014
\u2014
130
130
Consulting, scientific and technical activities
135,278
29,731
\u2014
165,009
Administrative and support services activities
19,669
5,895
\u2014
25,564
Public sector
49,415
\u2014
454
49,869
Health and collective service activities
10,642
\u2014
\u2014
10,642
Other services
\u2014
22
\u2014
22
Other international activities
\u2014
1
\u2014
1
4,124,547
86,681
411,532
4,622,760
Government and Public securities
10,041,213
\u2014
\u2014
10,041,213
14,165,760
86,681
411,532
14,663,973
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
Hedging derivatives
This balance is analysed, by hedging instruments, as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Assets
Liabilities
Swaps
32,365
42,728
69,349
39,041
Hedging derivatives are measured in accordance with internal valuation techniques considering observable
market inputs and, when not available, on information prepared by the Group by extrapolation of market data. In
accordance with the hierarchy of the valuation sources, as referred in IFRS 13, these derivatives are classified in
level 2. The Group resources to derivatives to hedge interest and exchange rate exposure risks. The accounting
method depends on the nature of the hedged risk, namely if the Group is exposed to changes in fair value,
variability in cash flows or highly probable forecast transactions.
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39, using mainly interest rate and exchange rate derivatives. The fair value hedge model is adopted for
debt securities, loans granted at fixed rate and money market loans and deposits, securities and combined hedge
of variable rate financial assets and fixed rate financial liabilities. The cash flows hedge model is adopted for future
transactions in foreign currency to cover dynamic changes in cash flows from loans granted and variable rate
deposits in foreign currency, and for mortgages in foreign currency.
The relationships that follow the fair value hedge model recorded ineffectiveness in the positive amount of EUR
2,609,000 (31\u00a0December 2024: negative amount of EUR 1,583,000), while hedging relationships that follow the cash
flow hedge model recorded positive ineffectiveness in the amount of EUR 6,000 (31\u00a0December 2024: negative
ineffectiveness of EUR 52 ,000).
Associated with hedge losses, the amount of EUR 321,661,000 (31\u00a0December 2024: EUR 262,845,000) of which EUR
389,944,000 (31\u00a0December 2024: EUR 335,276,000) was amortised from fair value reserves to interest and similar
income and interest and similar expense, relating to cash flow hedge accounting. The accumulated adjustment
on financial risks covered performed on the assets and liabilities which includes hedged items is detailed in note
55.
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining period)
Fair value
Up to
3 months
3 months to
1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining period)
Fair value
Up to
3 months
3 months to 1
year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
Non-subordinated debt securities issued
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Bonds
775,249
393,113
Medium term notes (MTN)
2,997,334
2,995,028
Securitisations
91,743
106,331
3,864,326
3,494,472
Corrections to the liabilities value subject to hedging operations
(13,456)
(5,507)
Deferred costs/(gains)
(9,157)
(10,403)
Interests payable
51,880
50,148
3,893,593
3,528,710
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
The characteristics of the bonds issued by the Group, as at 31\u00a0December 2025 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Repayment
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
Bcp 6NC5 Senior Preferred EUR
500MN NG - MTN 856
February, 2021
February, 2027
Fixed rate 1.125% year until
February 2026 /after Euribor
3M+Variable rate 1.55%
500,000
505,746
Bcp 1.75% Eur 500M 6.5Nc5.5
Social Senior Preferred Notes -
Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% year until April
2027/after 2%+Euribor 3M
500,000
492,563
BCP2024 - MTN 862 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due Oct 2029
October, 2024
October, 2029
Fixed rate 3.125% until October
2028; after 0.85%+Euribor 3M
500,000
501,039
BCP2024 - MTN 864 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due Jun 2031
June, 2025
June, 2031
Fixed rate 3.125% until June
2030; after 0.95%+Euribor3M
500,000
499,556
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
90,550
84,162
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
467
434
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
726
674
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05%+1.39% = 19.57%
20,785
21,466
Millennium Leasing CLN 23-38
July, 2023
October, 2038
Wibor 3m 6.85%+11.75% \u00a0= 18.6%
51,861
53,573
Bank Millennium - MILP-2027/09
September, 2023
September,
2027
Fixed rate 9.875%
500,279
519,039
Bank Millennium - BMCN_082036
December, 2023
August, 2036
Wibor 3m 5.85%+12.30%\u00a0=
18.15%
87,856
89,328
Mill Bank Hip 24/06/2027
June, 2024
June, 2027
Wibor 3m 5.85% + 0.57%
70,962
71,152
Bank Millennium - MILP-2029/09
September,
2024
September,
2029
Fixed rate 5.308%
500,462
507,552
Mill Bank Hip 2029/11
November, 2024
November, 2029
Wibor 3m 5.85% + 0.80%
118,217
119,189
Mill Bank Hip 2030/03
March, 2025
March, 2030
Wibor 3m 5.85%
189,122
189,637
Mill Bank Hip 2030/11
November, 2025
November, 2030
Wibor 3m 5,41%
236,446
238,483
3,893,593
As described in note 49, Banco Comercial Portugu\u00eas, S.A. has exercised its option to early redeem all of its
\u201cEUR500,000,000 Senior Preferred Fixed to Floating Rate Notes due October 2026\u201d (ISIN: PTBCP2OM0058), issued
on 2 October 2023 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d).
The characteristics of the bonds issued by the Group, as at 31\u00a0December 2024 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Repayment
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
Bcp 6NC5 Senior Preferred EUR
500MN NG - MTN 856
February, 2021
February, 2027
Fixed rate 1.125% year until
February 2026 /after Euribor
3M+Variable rate 1.55%
500,000
507,523
Bcp 1.75% Eur 500M 6.5Nc5.5 Social
Senior Preferred Notes - Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% year until April
2027/after 2%+Euribor 3M
500,000
481,523
BCP2023 MTN 861 BCP Senior
Preferred Notes OCT 2026
October, 2023
October, 2026
Fixed rate 5.625% until October
2025; after 1.90% + Euribor 3M
500,000
505,931
BCP2024 - MTN 862 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due OCT 2029
October, 2024
October, 2029
Fixed rate 3.125% until October
2028; after 0.85%+Euribor 3M
500,000
502,606
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
104,946
97,713
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
542
504
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
841
783
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05%+1.39% = 19.57%
26,602
27,581
Millennium Leasing CLN 23-38
July, 2023
October, 2038
Wibor 3m 6.85%+11.75% \u00a0= 18.6%
65,471
67,776
Bank Millennium - MILP-2027/09
September, 2023
September, 2027
Fixed rate 9.875%
499,009
523,513
Bank Millennium - BMCN_082036
December, 2023
August, 2036
Wibor 3m 5.85%+12.30%\u00a0= 18.15%
114,340
116,445
Mill Bank Hip 24/06/2027
June, 2024
June, 2027
Wibor 3m 5.85% + 0.57%
70,015
70,272
Bank Millennium - MILP-2029/09
September, 2024
September, 2029
Fixed rate 5.308%
499,567
508,641
Mill Bank Hip 2029/11
November, 2024
November, 2029
Wibor 3m 5,85% + 0,80%
116,685
117,899
3,528,710
This balance as at 31\u00a0December 2025 is analysed by the remaining period, as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
6 months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
\u2014
\u2014
\u2014
618,461
164,367
782,828
Medium term notes (MTNs)
\u2014
\u2014
\u2014
2,525,939
499,556
3,025,495
Securitisations
\u2014
\u2014
\u2014
\u2014
85,270
85,270
\u2014
\u2014
\u2014
3,144,400
749,193
3,893,593
This balance as at 31\u00a0December 2024 is analysed by the remaining period, as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
6 months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
\u2014
\u2014
\u2014
188,171
211,802
399,973
Medium term notes (MTNs)
\u2014
\u2014
\u2014
3,029,737
\u2014
3,029,737
Securitisations
\u2014
\u2014
\u2014
\u2014
99,000
99,000
\u2014
\u2014
\u2014
3,217,908
310,802
3,528,710
Subordinated debt
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Bonds
Non-Perpetual
1,382,228
1,407,796
Corrections to the liabilities value subject to hedging operations (note 55)
(10,783)
(17,808)
Deferred costs / (income)
(2,232)
(1,142)
Interests payable
42,445
38,513
1,411,658
1,427,359
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
As at 31\u00a0December 2025 , the subordinated debt issues are analysed as follows:
(Thousands of euros)
2025
Issue
Issue
date
Repayment
date
Interest
rate
Nominal
value
Book
value
Own funds
value (*)
Banco Comercial Portugu\u00eas
Bcp Fix Rate Reset Sub Notes-Emtn
854
December,
2017
December,
2027
See reference (i)
86,800
86,792
33,560
BCP Tier 2 Subord Callable Notes
Due May 2032 - MTN 858
November,
2021
May, 2032
See reference (ii)
300,000
298,697
298,700
BCP2022 Tier 2 Sub Callable Notes
Due 2 June 2033 MTN 860
December,
2022
March, 2033
See reference (iii)
133,700
142,774
142,773
BCP2025 Tier2 Sub Callable Notes
Due 20 March 2037 MTN 863
March, 2025
March, 2037
See reference (iv)
500,000
514,475
513,953
Bank Millennium
Bank Millennium - BKMO_071227R
December,
2017
December,
2027
6.31%
165,767
166,447
34,564
Bank Millennium - BKMO_300129W
January, 2019
January, 2029
7.09%
196,552
202,429
40,983
Magellan No. 3
Magellan No. 3 Series 3 Class F
June, 2005
May, 2058
-
44
44
\u2014
1,411,658
1,064,533
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following years: mid-swap rate in force at the beginning of this period + 4.267%.
(ii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the mid-swap rates
of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the 5-year mid swaps rate prevailing
at that time plus the Spread.
(iii) Fixed annual interest rate of 8.75% during the first 5 years and 3 months. The annual interest rate from 5 years and 3 months onwards was set at
the 5-year mid-swap rate plus a 6.051%.
(iv) Rate of 4.75% per annum during the first 7 years; 8th year and following years: mid-swap rate in force at the beginning of this period + 2.15%.
As described in note 49, Banco Comercial Portugu\u00eas, S.A. has exercised its option to early redeem all of its
EUR450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 (ISIN: PTBIT3OM0098), issued on 27
September 2019 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d).
As at 31\u00a0December 2024, the subordinated debt issues are analysed as follows:
(Thousands of euros)
2024
Issue
Issue
date
Repayment
date
Interest
rate
Nominal
value
Book
value
Own
funds
value (*)
Banco Comercial Portugu\u00eas
Bcp Fix Rate Reset Sub Notes-Emtn
854
December,
2017
December,
2027
See reference (i)
166,300
167,306
97,540
Bcp Subord Fix Rate Note Projeto
Tagus Mtn 855
September,
2019
March, 2030
See reference (ii)
450,000
459,580
459,581
BCP Tier 2 Subord Callable Notes
Due May 2032 - MTN 858
November,
2021
May, 2032
See reference (iii)
300,000
293,154
293,154
BCP2022 Tier 2 Sub Callable Notes
Due 2 June 2033 MTN 860
December,
2022
March, 2033
See reference (iv)
133,700
141,962
141,962
Bank Millennium
Bank Millennium - BKMO_071227R
December,
2017
December,
2027
8.08%
163,678
164,548
43,384
Bank Millennium - BKMO_300129W
January, 2019
January, 2029
8.17%
194,075
200,765
51,441
Magellan No. 3
Magellan No. 3 Series 3 Class F
June, 2005
May, 2058
-
44
44
\u2014
1,427,359
1,087,062
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following years: mid-swap rate in force at the beginning of this period + 4.267%;
(ii) Annual interest rate of 3.871% during the first 5.5 years (corresponding to a spread of 4.231% over the 5.5-year mid-swap rate, for the remaining 5
years will be applied over the mid-swap rate in force at the beginning of that period).
(iii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the mid-swap rates
of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the 5-year mid swaps rate prevailing
at that time plus the Spread.
(iv) Fixed annual interest rate of 8.75% during the first 5 years and 3 months. The annual interest rate from 5 years and 3 months onwards was set at
the 5-year mid-swap rate plus a 6.051%.
The analysis of the subordinated debt by remaining period, is as follows:
(Thousands of euros)
2025
2024
1 to 5 years
455,668
532,619
Over 5 years
955,990
894,740
1,411,658
1,427,359
Financial liabilities held for trading
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Short sales
8,949
44,607
Trading derivatives (note 24)
\u00a0 Swaps
114,320
84,308
\u00a0 Options
23,394
45,140
of which: Embedded derivatives
22,531
42,477
Forwards
6,066
5,572
143,780
135,020
152,729
179,627
Level 2
120,807
91,526
Level 3
31,922
88,101
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial liabilities held for trading includes, as at 31\u00a0December 2025, the embedded derivatives
valuation separated from the host contracts in accordance with the accounting policy presented in note 1 C5. in
the amount of EUR 22,531,000 (31\u00a0December 2024: EUR 42,477,000). This note should be analysed together with
note 24.
Financial liabilities designated at fair value through profit or loss
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Deposits from customers (*)
2,075,969
1,956,851
Certificates
1,538,366
1,292,006
3,614,335
3,248,857
(*) Deposits from customers whose remuneration is indexed to a set of shares and/or indices.
As at 31\u00a0December 2025, the analysis of Debt securities at fair value through profit and loss, is as follows:
(Thousands of euros)
2025
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Deposits from customers
714,936
379,480
981,553
\u2014
\u2014
2,075,969
Certificates
\u2014
\u2014
\u2014
\u2014
1,538,366
1,538,366
714,936
379,480
981,553
\u2014
1,538,366
3,614,335
As at 31\u00a0December 2024, the analysis of this balance, by remaining period, is as follows:
(Thousands of euros)
2024
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Deposits from customers
731,697
53,558
790,759
380,837
\u2014
1,956,851
Certificates
\u2014
\u2014
35,748
\u2014
1,256,258
1,292,006
731,697
53,558
826,507
380,837
1,256,258
3,248,857
Transfers of assets
The Group performed a set of transactions of sale of financial assets (namely loans and advances to customers) for
Funds specialised in the recovery of loans. These funds take the responsibility for management of the borrower
companies or assets received as collateral with the objective of ensuring a pro-active management through the
implementation of plans to explore/increase the value of the companies/assets.
The specialised funds in credit recovery that acquired the financial assets are closed funds, in which the holders of
the investment units have no possibility to request the repayment of its investment units throughout the useful
life of the fund. These investment units are held by several banks, which are the sellers of the loans, in percentages
that vary through the useful life of the Funds, ensuring however that, separately, none of the banks hold more
than 50% of the capital of the Fund.
The Funds have a specific management structure (General Partner), fully independent from the assignor banks
and that is selected on the date of establishment of the Fund. The management structure of the Fund has as
main responsibilities to: (i) determine the objective of the Fund and (ii) administrate and manage exclusively the
Fund, determining the objectives and investment policy and the conduct in management and business of the
Fund. The management structure is remunerated through management commissions charged to the Funds.
These funds (in which the Group holds minority positions) establish companies in order to acquire the loans to the
banks, which are financed through the issuance of senior and junior securities. The value of the senior securities
fully subscribed by the Funds that hold the share capital match the fair value of the asset sold, determined in
accordance with a negotiation based on valuations performed by both parties.
The value of the junior securities is equivalent to the difference between the fair value that was based on the
valuation of the senior security and the value of the transferred receivables. These junior securities, being
subscribed by the Group, will entitle the Group to a contingent positive value if the value of the assets transferred
exceeds the amount of the senior tranches plus the remuneration on them. Thus, considering these junior assets
reflect a difference between the valuations of the assets sold based on the appraisals performed by independent
entities and the negotiation between the parties, the Group performs the constitution of impairment losses for all
of them.
Therefore, as a result of the transfer of assets occurred operations, the Group subscribed:
- Senior securities (investment units) of the funds, for which the cash-flows arise mainly from a set of assets
transferred from the participant banks. These securities are booked in Financial assets not held for trading
mandatorily at fair value through profit or loss portfolio and are accounted for at fair value based on the last
available Net assets value (NAV), as disclosed by the Management companies and audited at year end, still being
analysed by the Bank;
- Junior securities (with higher subordination degree) issued by the Portuguese law companies held by the funds
and which are fully provided to reflect the best estimate of impairment of the financial assets transferred.
Within this context, not withholding control but maintaining an exposure to certain risks and rewards, the Group,
in accordance with IFRS 9 3.2 performed an analysis of the exposure to the variability of risks and rewards in the
assets transferred, before and after the transaction, having concluded that it does not hold substantially all the
risks and rewards. Considering that it does not hold control and does not exercise significant influence on the
funds or companies' management, the Group performed, under the scope of IAS IFRS 9 3.2, the derecognition of
the assets transferred and the recognition of the assets received.
The results were calculated on the date of transfer of the assets. During 2025 and 2024, no credits were sold to
corporate restructuring funds.
The amounts accumulated as at 31\u00a0December 2025, related to these operations, are analysed as follows:
(Thousands of euros)
Assets
transferred
Net assets
transferred
Received
value
Net gains
/ (losses)
Fundo Aquarius FCR (a)
132,635
124,723
132,635
7,912
Discovery Real Estate Fund (a)
211,388
152,155
138,187
(13,968)
Fundo Vega FCR (b)
113,665
113,653
109,599
(4,054)
457,688
390,531
380,421
(10,110)
The activity segments are as follows: a) Real estate and tourism; and b) Real estate.
The amounts accumulated as at 31\u00a0December 2024, related to these operations, are analysed as follows:
(Thousands of euros)
Assets
transferred
Net assets
transferred
Received
value
Net gains
/ (losses)
Fundo Recupera\u00e7\u00e3o FCR (in liquidation) (a)
343,266
243,062
232,267
(10,795)
Fundo Aquarius FCR (b)
132,635
124,723
132,635
7,912
Discovery Real Estate Fund (b)
211,388
152,155
138,187
(13,968)
Fundo Vega FCR (c)
113,665
113,653
109,599
(4,054)
800,954
633,593
612,688
(20,905)
The activity segments are as follows: a) Diversified; b) Real estate and tourism; and c) Real estate.
As at 31\u00a0December 2025 and 2024, the assets received under the scope of these operations are comprised of:
(Thousands of euros)
2025
Fair value of
Investment fund
units (note 24)
Shareholder
loans (note 32)
Total
Fundo Aquarius FCR
67,258
\u2014
67,258
Discovery Real Estate Fund
172,953
\u2014
172,953
Fundo Vega FCR
33,923
\u2014
33,923
274,134
\u2014
274,134
(Thousands of euros)
2024
Fair value of
Investment fund
units (note 24)
Shareholder
loans (note 32)
Total
Fundo Recupera\u00e7\u00e3o FCR (in liquidation)
13,987
\u2014
13,987
Fundo Aquarius FCR
88,876
\u2014
88,876
Discovery Real Estate Fund
167,894
\u2014
167,894
Fundo Vega FCR
32,471
\u2014
32,471
303,228
\u2014
303,228
In the last quarter of 2025, the Fundo Recupera\u00e7\u00e3o FCR was sold.
As at 31\u00a0December 2025 and 2024, the book value of investment funds units is recorded under Financial assets not
held for trading mandatorily at fair value through profit or loss (note 24) and considers the Fund's Global Net Asset
Value (NAV) communicated by the Management Companies.
It is also important to mention the following aspects: (i) these are Funds whose latest Audit Reports available as at
31 December 2024 and latest Limited Audit Reports available as at 30 June 2025, do not include reserves. However,
the Fundo Discovery Audit Report, as at 31 December 2024, mentions a \"Material uncertainty related to going
concern\" ; (ii) the funds are subject to supervision by the competent authorities.
The balance Shareholder loans\u00a0 in the gross amount of EUR 100,375,000 (31\u00a0December 2024: EUR 113,840,000) has
recorded an impairment of the same amount (note 32).
The detail of the commitments of subscribed and unpaid capital for each of the corporate restructuring funds is
analysed as follows:
(Thousands of euros)
2025
2024
Corporate restructuring funds
Subscribed
capital
Paid up
capital
realized
Subscribed
and unpaid
capital
Subscribed
capital
Paid up
capital
realized
Subscribed
and unpaid
capital
Fundo Recupera\u00e7\u00e3o FCR (in liquidation)
\u2014
\u2014
\u2014
162,149
162,146
3
Fundo Aquarius FCR
75,862
70,871
4,991
97,739
87,125
10,614
Discovery Real Estate Fund
158,991
158,991
\u2014
158,991
158,991
\u2014
Fundo Vega FCR
45,439
44,169
1,270
45,439
43,825
1,614
280,292
274,031
6,261
464,318
452,087
12,231
There are additional subscription commitments for the fund Discovery, in the amount of EUR 1,107,000
(31\u00a0December 2024: EUR 1,107,000).
Moreover, the following exposures and respective impairment are recorded in the Loans and advances to
customers portfolio and under the Guarantees provided and Irrevocable credit facilities items, in relation to
entities controlled by these funds:
(Thousands of euros)
Items
2025
2024
Loans and advances to customers
5,748
17,416
Guarantees granted and irrevocable credit lines
6,382
22,590
Gross exposure
12,130
40,006
Impairment
(561)
(2,160)
Net exposure
11,569
37,846
Project Crow
As part of the sale process called Project Crow concluded at the end of 2022, Banco Comercial Portugu\u00eas, S.A. now
holds an investment in a venture capital fund, in 2 real estate funds and in a company, as follows:
(Thousands of euros)
2025
2024
Investments in associates (note 26)
Fundo Turismo Algarve, FCR
42,037
41,045
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in liquidation)
16,273
19,175
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo (in liquidation)
1,737
4,305
60,047
64,525
As referred in note 39, there are provisions for liabilities and charges recorded for corporate restructuring funds
and carved-out assets of the Project Crow.
Banco Comercial Portugu\u00eas, S.A. informed about Interim report on the transactions
conducted under the Share BuyBack Programme
On 25 August 2025, in the context of the BuyBack Programme, the Bank informed that has, up until that date,
purchased 309,362,863 shares for a price amounting to a total of EUR 200,000,000, holding on that date an
aggregate total 309,362,863 own shares, representing 2.05% of its share capital.
These purchases are the last purchases to be made under the BuyBack Programme, thus the programme being
deemed as completed in accordance with its terms, as duly disclosed to the market in due course.
Banco Comercial Portugu\u00eas, S.A. informed about 2025 EU-Wide Stress Test Results
On 1 August 2025, Banco Comercial Portugu\u00eas, S.A. informed that it was subjected to the 2025 EU-wide stress test
conducted by the European Banking Authority (EBA), in cooperation with the Banco de Portugal (BdP), the
European Central Bank (ECB), and the European Systemic Risk Board (ESRB).
Banco Comercial Portugu\u00eas, S.A. notes the announcements made today by the EBA on the EU-wide stress test
and fully acknowledges the outcomes of this exercise, comprising 64 banks that together represent around 75% of
total banking assets in the European Union.
The 2025 EU-wide stress test does not contain a pass-fail threshold and instead is designed to be used as an
important source of information for the purposes of the Supervisory Review and Evaluation Process (SREP). The
results will assist competent authorities in assessing Banco Comercial Portugu\u00eas, S.A. ability to meet applicable
prudential requirements under stressed scenarios.
The adverse stress test scenario was set by the ECB/ESRB and covers a three-year time horizon (2025-2027). The
stress test has been carried out applying a static balance sheet assumption as of December 2024, and therefore
does not take into account future business strategies and management actions. It is not a forecast of Banco
Comercial Portugu\u00eas, S.A. financial evolution.
Considering the results of Banco Comercial Portugu\u00eas, S.A, in the stress test, it should be highlighted the
following:
\u2022 the application of the adverse scenario resulted in a reduction of 228 b.p. at the end of 2025, 152 b.p. at the
end of 2026 and of 100 b.p. at the end of 2027 compared to the CET1 fully loaded restated (CRR3) capital
ratio of 2024, which compares with an average reduction in the universe of the 64 banks submitted to this
exercise, of 260 b.p. at the end of 2025, 275 b.p. at the end of 2026 and 304 b.p. at the end of 2027.
\u2022 the application of the baseline scenario resulted in an increase of 129 b.p in the fully loaded CET1 capital
ratio at the end of 2025, 254 b.p. at the end of 2026 and of 279 b.p. at the end of 2027 compared to the
CET1 fully loaded restated (CRR3) capital ratio of 2024, which compares with an average increase in the
universe of the 64 banks submitted to this exercise, of 65 b.p at the end of 2025, 113 b.p. at the end of 2026
and 128 b.p. at the end of 2027.
Banco Comercial Portugu\u00eas, S.A. informed on notification by Banco de Portugal
regarding MREL requirements
On 11 July 2025, Banco Comercial Portugu\u00eas, S.A. (\"BCP\" or the \"Bank\") informed that it has been notified by Banco
de Portugal, as the national resolution authority, about the update of its minimum requirement for own funds and
eligible liabilities (\"MREL\" or \"Minimum Requirement for own funds and Eligible Liabilities\") as decided by the
Single Resolution Board.
The resolution strategy applied continues to be that of a multiple point of entry (\"MPE\"). The MREL requirements
to be met by BCP Group of Resolution (consisting of BCP, S.A., Banco ActivoBank, S.A. and all the subsidiary
companies of BCP apart from Bank Millennium S.A. and Banco Internacional de Mo\u00e7ambique and their respective
subsidiaries), with immediate application, is of:
\u2022 24.89% of the total risk exposure amount (\"TREA\") to which adds further a combined buffer requirement
(\"CBR\"), which also includes the \u201cCountercyclical Capital Buffer\u201d \u2014 CCyB and the \u201cSystemic Risk Buffer\u201d \u2014
SyRB, currently of 3.95%, thus corresponding to total requirements currently of 28.84%; and
\u2022 6.86% of the leverage ratio exposure measure (\"LRE\").
Additionally, the Bank informed that is not subject to any subordination requirements.
In accordance with the regulations in force, MREL requirements could be annually updated by the competent
authorities, and therefore these targets replace those previously set.
At the date of this announcement, BCP informed that it complies with the established MREL requirements, both
as a percentage of the TREA (including the CBR) and as a percentage of the LRE.
Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to customers, fair value is estimated through internal models based on cash-flow
discounting techniques. Cash-flows for the different instruments sold are calculated according to its financial
characteristics and the discount rates used include both the market interest rate curve and the current conditions
of the Group's pricing policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree
of judgement and reflects exclusively the value attributed to different financial instruments. However, it does not
consider prospective factors, as the future business evolution. Therefore, the values presented cannot be
understood as an estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial
liabilities are presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions
repayable on demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable
estimate of its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and other
funds and Assets with repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future
cash flows for these instruments, considering that the payments of the instalments occur in the contractually
defined dates. This update is made based on the prevailing market rate for the term of each cash flow plus the
average spread of the production of the most recent 3 months of the same. For the elements with signs of
impairment, the net impairment of these operations is considered as a reasonable estimate of their fair value,
considering the economic valuation that is realised in the determination of this impairment.
For Deposits from Central Banks and other funds, it was considered that the book value is a reasonable estimate
of its fair value, given the nature of operations and the associated short-term.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied
by the Group on identical instruments for each of the different residual maturities (rates from the monetary
market or from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to
conditions used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of
its fair value (this class incorporates among other, factoring operations, current account credit, credit cards and
overdrafts in demand deposits).
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined
dates. For loans with signs of impairment (Stage 3 loans), the net impairment of these operations is considered as
a reasonable estimate of their fair value, considering the economic valuation that is realised in the determination
of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes
of this type of instruments and with similar residual maturity. The discount rate includes the market rates for the
residual maturity date (rates from the monetary market or from the interest rate swap market) and the spread
used at the date of the report, which was calculated from the average production of the three most recent
months compared to the reporting date.
Deposits from customers and other funds
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar
maturity. The discount rate includes the market rates of the residual maturity date (rates of monetary market or
the interest rate swap market, at the end of the period) and the actual spread of the Group. This was calculated
from the average production of the three most recent months compared to the reporting date.
As in the case of credits without defined maturity, also for the Deposits from customers without defined maturity
(demand deposits) it is considered that given the potential short term of the same, possibility of their liquidation at
any time, the book value of these liabilities is a reasonable estimate of their fair value.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers,
Deposits from credit institutions and other funds and Deposits from customers and other funds are analysed as
follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives) and financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"),
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
In this class of assets, the fair value corresponds to their book value.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering
the volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the
available models do not fully apply to meet the characteristics of the financial instrument, specific quotations
supplied by an external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt instruments
These financial instruments are accounted at amortised cost net of impairment, as referred in the accounting
policy described in note 1 C1.1.1. The fair value of this class of assets, is based on market prices, whenever these are
available. If market prices are not available, fair value is estimated through numerical models based on cash-flow
discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical
cash-flow discounting techniques and models for assessment of options considering variables of the market,
particularly the interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes. The remaining market inputs, such as yield curves, credit, exchange
rates, among others, are also made available by financial content providers.
Debt securities non-subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet
reflected in the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-
accounting\", the fair value related to the interest rate risk is already recognised. For the fair value calculation, other
components of risk were considered, in addition to the interest rate risk already recorded, when applicable. The
fair value is based on market prices, whenever these are available. If market prices are not available, fair value is
estimated through numerical models based on cash-flow discounting techniques, using the market interest rate
curve adjusted by associated factors, predominantly credit risk and trading margin, the latter only in the case of
issues placed on non-institutional customers of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps
established specifically for each term and class of instruments based on the market prices on equivalent
instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the
cost obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies
used in the determination of the fair value of the issues is analysed as follows:
2025
2024
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
5.41%
0.00%
5.06%
0.00%
Senior
3.01%
0.00%
3.03%
0.00%
Placed in retail
Senior and collateralised
2.90%
3.68%
3.11%
4.94%
For Non-subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of EUR 22,162,000 (31\u00a0December 2024: a
positive amount of EUR 22,410,000) and includes a payable amount of EUR 22,531,000 (31\u00a0December 2024: a
payable amount of EUR 42,477,000) which reflects the fair value of embedded derivatives and are recorded in
financial assets and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2025
2024
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.01%
3.69%
3.73%
5.02%
2.98%
4.45%
4.87%
5.73%
7 days
1.98%
3.73%
3.72%
5.19%
2.98%
4.41%
4.86%
5.73%
1 month
2.03%
3.77%
3.83%
5.23%
2.95%
4.41%
4.80%
5.72%
2 months
2.04%
3.77%
3.89%
5.16%
2.89%
4.42%
4.78%
5.73%
3 months
2.09%
3.81%
3.90%
5.10%
2.81%
4.44%
4.78%
5.74%
6 months
2.16%
3.79%
3.91%
4.88%
2.59%
4.46%
4.79%
5.70%
9 months
2.23%
3.77%
3.92%
4.76%
2.49%
4.48%
4.81%
5.61%
1 year
2.15%
3.68%
3.67%
4.60%
2.33%
4.43%
4.82%
5.62%
2 years
2.23%
3.55%
3.71%
4.21%
2.19%
4.34%
4.51%
5.22%
3 years
2.35%
3.58%
3.83%
4.09%
2.19%
4.32%
4.40%
5.03%
5 years
2.55%
3.70%
3.97%
4.13%
2.24%
4.31%
4.29%
4.99%
7 years
2.71%
3.86%
4.19%
4.25%
2.29%
4.32%
4.26%
5.04%
10 years
2.92%
4.07%
4.49%
4.49%
2.36%
4.34%
4.31%
5.15%
15 years
3.16%
4.37%
4.66%
4.88%
2.42%
4.39%
4.43%
5.31%
20 years
3.26%
4.52%
4.68%
4.87%
2.36%
4.37%
4.49%
5.35%
30 years
3.25%
4.46%
4.72%
4.84%
2.15%
4.21%
4.46%
5.35%
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
4,089,540
4,089,540
4,089,540
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
186,011
186,011
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
861,245
861,245
829,391
Loans and advances to customers (i)
\u2014
\u2014
57,406,675
57,406,675
56,511,413
Debt securities
\u2014
\u2014
24,538,875
24,538,875
24,552,771
Financial assets at fair value
Loans and advances to customers
9,400
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
202,495
10,647,475
\u2014
10,849,970
10,849,970
Bonds issued by public companies and
other entities
1,076
2,105,881
\u2014
2,106,957
2,106,957
Treasury bills
587,739
3,261,877
\u2014
3,849,616
3,849,616
Shares
63,700
30,539
\u2014
94,239
94,239
Investment units
289,801
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
115,370
Trading derivatives
147,302
\u2014
\u2014
147,302
147,302
Hedging derivatives (ii)
32,365
\u2014
\u2014
32,365
32,365
1,449,248
16,045,772
87,082,346
104,577,366
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
878,571
878,571
805,842
Deposits from customers and other funds
\u2014
\u2014
87,672,860
87,672,860
87,663,994
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,893,593
3,893,593
3,915,755
Subordinated debt (i)
\u2014
\u2014
1,411,658
1,411,658
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
2,075,969
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
1,538,366
Short selling securities
8,949
\u2014
\u2014
8,949
8,949
Trading derivatives
143,780
\u2014
\u2014
143,780
143,780
Hedging derivatives (ii)
42,728
\u2014
\u2014
42,728
42,728
3,809,792
\u2014
93,856,682
97,666,474
97,626,912
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group includes in the Book value column of the balance Financial assets at amortised cost - Debt securities
the variation in the fair value of the hedged element attributable to the hedged risk (risk of interest rate) for
securities to which the Group is applying fair value hedge accounting.
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
5,589,030
5,589,030
5,589,030
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
251,157
251,157
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
797,535
797,535
787,632
Loans and advances to customers (i)
\u2014
\u2014
53,907,058
53,907,058
52,984,229
Debt securities
\u2014
\u2014
21,345,171
21,345,171
21,047,438
Financial assets at fair value
Loans and advances to customers
427
\u2014
\u2014
427
427
Bonds issued by public entities
175,206
8,411,395
\u2014
8,586,601
8,586,601
Bonds issued by public companies and
other entities
413
1,970,392
\u2014
1,970,805
1,970,805
Treasury bills
1,117,504
2,490,850
\u2014
3,608,354
3,608,354
Shares
60,352
26,329
\u2014
86,681
86,681
Investment units
323,969
\u2014
\u2014
323,969
323,969
Other securities
87,563
\u2014
\u2014
87,563
87,563
Trading derivatives
387,073
\u2014
\u2014
387,073
387,073
Hedging derivatives (ii)
69,349
\u2014
\u2014
69,349
69,349
2,221,856
12,898,966
81,889,951
97,010,773
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
777,719
777,719
781,443
Deposits from customers and other funds
\u2014
\u2014
82,084,687
82,084,687
81,945,936
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,528,710
3,528,710
3,551,120
Subordinated debt (i)
\u2014
\u2014
1,427,359
1,427,359
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
1,956,851
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
1,292,006
Short selling securities
44,607
\u2014
\u2014
44,607
44,607
Trading derivatives
135,020
\u2014
\u2014
135,020
135,020
Hedging derivatives (ii)
39,041
\u2014
\u2014
39,041
39,041
3,467,525
\u2014
87,818,475
91,286,000
91,236,905
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group classified the financial instruments recorded in the balance sheet at fair value in accordance with the
hierarchy established in IFRS 13. The fair value of financial instruments is determined using quotations recorded in
active and liquid markets, considering that a market is active and liquid whenever its stakeholders conduct
transactions on a regular basis giving liquidity to the instruments traded. When it is verified that there are no
transactions that regularly provide liquidity to the traded instruments, valuation methods and techniques are
used to determine the fair value of the financial instruments.
Level 1 - With quotation in active market
In this category are included, in addition to financial instruments traded on a regulated market, bonds and units of
investment funds valued based on the prices disclosed through trading systems.
The classification of the fair value of level 1 is used when:
i. there is a firm daily enforceable quotation for the financial instruments concerned, or;
ii. there is a quotation available in market information systems that aggregate multiple prices of various
stakeholders.
Level 2 - Valuation methods and techniques based on market data
Financial instruments, when there are no regular transactions in the active and liquid markets (level 1), are
classified in level 2, according to the following rules:
i. failure to comply with the rules defined for level 1, or;
ii. they are valued based on valuation methods and techniques that use mostly observable market data (interest
rate or exchange rate curves, credit curves, etc.).
Level 2 includes over-the-counter derivative financial instruments contracted with counterparties with which the
Group maintains collateral agreements (ISDAs with Credit Support Annex (CSA)). In addition, derivative financial
instruments traded in the over-the-counter market, which, despite not having CSA agreements, the non-
observable market data component (i.e., internal ratings, default probabilities determined by internal models, etc.)
incorporated in the estimation of CVA/DVA is not significant in the overall value of the derivative. In order to assess
the significance of this component, the Group defined a quantitative relevance criterion and performed a
qualitative sensitivity analysis on the valuation component that includes unobservable market data.
Level 3 - Valuation methods and techniques based on data not observable in the
market
If the level 1 or level 2 criteria are not met, financial instruments should be classified in level 3, as well as in
situations where the fair value of financial instruments results from the use of information not observable in the
market, such as:
- financial instruments which are not classified as level 1 and which are valued using evaluation methods and
techniques without being known or where there is consensus on the criteria to be used, namely:
i. - those measured using comparative price analysis of financial instruments with risk and return profile, typology,
seniority or other similar factors, observable in the active and liquid markets;
ii. - those measured using performance indicators of the underlying transactions (e.g. default probability rates of
the underlying assets, delinquency rates, evolution of the ratings, etc.);
iii. - those measured taking as reference the NAV (Net Asset Value) disclosed by the management entities of
securities/real estate/other investment funds not listed on a regulated market.
Level 3 includes over-the-counter derivative financial instruments that have been contracted with counterparties
with which the Group does not maintain collateral exchange agreements, and whose unobservable market data
component incorporated in the estimation of the value adjustment, such as those relating to synthetic
securitisation operations carried out by the Group.
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2025:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
4,089,540
Loans and advances to credit institutions repayable on
demand
186,011
\u2014
\u2014
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
829,391
829,391
Loans and advances to customers
\u2014
\u2014
56,511,413
56,511,413
Debt securities
20,342,177
1,039,152
3,171,442
24,552,771
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
10,811,416
25,224
13,330
10,849,970
Bonds issued by public companies and other entities
1,951,759
155,198
\u2014
2,106,957
Treasury bills
1,345,214
2,504,402
\u2014
3,849,616
Shares
58
\u2014
94,181
94,239
Investment units
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
Trading derivatives
\u2014
124,541
22,761
147,302
Hedging derivatives
\u2014
32,365
\u2014
32,365
38,841,545
3,880,882
60,941,719
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
805,842
805,842
Deposits from customers and other funds
\u2014
\u2014
87,663,994
87,663,994
Non-subordinated debt securities issued
\u2014
\u2014
3,915,755
3,915,755
Subordinated debt
\u2014
\u2014
1,431,529
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
Short selling securities
\u2014
\u2014
8,949
8,949
Trading derivatives
\u2014
120,807
22,973
143,780
Hedging derivatives
\u2014
42,728
\u2014
42,728
1,538,366
163,535
95,925,011
97,626,912
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2024:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
5,589,030
\u2014
\u2014
5,589,030
Loans and advances to credit institutions repayable on
demand
251,157
\u2014
\u2014
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
787,632
787,632
Loans and advances to customers
\u2014
\u2014
52,984,229
52,984,229
Debt securities
17,779,491
462,939
2,805,008
21,047,438
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
427
427
Bonds issued by public entities
8,539,158
26,198
21,245
8,586,601
Bonds issued by public companies and other entities
1,812,602
98,640
59,563
1,970,805
Treasury bills
1,454,611
2,153,743
\u2014
3,608,354
Shares
29,587
\u2014
57,094
86,681
Investment units
\u2014
\u2014
323,969
323,969
Other securities
87,108
\u2014
455
87,563
Trading derivatives
\u2014
109,695
277,378
387,073
Hedging derivatives
\u2014
69,349
\u2014
69,349
35,542,744
2,920,564
57,317,000
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
781,443
781,443
Deposits from customers and other funds
\u2014
\u2014
81,945,936
81,945,936
Non-subordinated debt securities issued
\u2014
\u2014
3,551,120
3,551,120
Subordinated debt
\u2014
\u2014
1,490,881
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
Short selling securities
\u2014
\u2014
44,607
44,607
Trading derivatives
\u2014
91,526
43,494
135,020
Hedging derivatives
\u2014
39,041
\u2014
39,041
1,292,006
130,567
89,814,332
91,236,905
The changes that occurred during 2025 in financial assets and liabilities accounted for at fair value and classified at
level 3, are detailed as follows:
(Thousands of euros)
2025
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
277,832
355,211
107,088
43,494
Gains / (losses) recognised in profit or loss
Net trading income
(72)
3,777
\u2014
(19,946)
Net interest income
\u2014
1,250
24
\u2014
Transfers between levels
(54)
\u2014
(59,463)
\u2014
Capital increases (Investment units)
\u2014
42,065
\u2014
\u2014
Capital reductions (Investment units)
\u2014
(68,651)
\u2014
\u2014
Purchases
22,761
20,712
14,817
442
Sales
(277,706)
(731)
(12,371)
(1,017)
Amortisations
\u2014
(51)
(5,671)
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
2,181
\u2014
Exchange rate differences
\u2014
37
(2,672)
\u2014
Accrued interest
\u2014
\u2014
(62)
\u2014
Balance as at 31 December
22,761
353,619
43,871
22,973
(*) Do not include short sales in the amount of EUR 8,949,000 (note 37).
In 2025, the unobservable inputs included in the valuation of two issues recorded in the portfolio of financial assets
at fair value through other comprehensive income, under the balance Transfers between levels, lost relevance and,
therefore, the securities were classified as level 2 in the fair value hierarchy.
The changes that occurred during 2024 in financial assets and liabilities accounted for at fair value and classified
at level 3, are detailed as follows:
(Thousands of euros)
2024
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
332,705
433,603
101,427
97,994
Gains / (losses) recognised in profit or loss
Net trading income
6,569
1,827
\u2014
(52,808)
Net interest income
31
763
88
\u2014
\u00a0 Impairment
\u2014
(73,891)
\u2014
\u2014
Transfers between portfolios
54
\u2014
\u2014
\u2014
Transfers between levels
\u2014
621
\u2014
\u2014
Capital increases (Investment units)
\u2014
(25,567)
\u2014
\u2014
Capital reductions (Investment units)
14,077
7,873
67,586
695
Purchases
(75,604)
(15,991)
(544)
(2,387)
Sales
\u2014
\u2014
(65,604)
\u2014
Amortisations
\u2014
\u2014
3,600
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
992
\u2014
Exchange rate differences
\u2014
960
(457)
\u2014
Accrued interest
\u2014
25,013
\u2014
\u2014
Balance as at 31 December
277,832
355,211
107,088
43,494
(*) Do not include short sales in the amount of EUR 44,607,000 (note 37).
The balance Transfer between portfolios in the amount of EUR 73,891,000 refers to the classification of Fundo
Turismo Algarve, FCR as associate at the end of 2024.
In 2024, there were no relevant transfers relating to the measurement of financial instruments with respect to
valuation levels.
The Group prepared a sensitivity analysis of the variation in the probability of default by 1 percentage point (2
percentage points for the Caravela 6 operation) at the fair value of the credit default swaps recognised by level 3,
with an estimated impact of around EUR 21,000 (31\u00a0December 2024: EUR 61,000).
The remaining unlisted instruments classified at level 3 are essentially venture capital funds with recognised
valuation based on the information provided by the management entities. The variation of 1% in the quotation
value of these assets impacts the balance sheet value of the same magnitude.
Impairment and Write-offs
The credit impairment calculation as at 31\u00a0December 2025 and 2024 integrates the general principles defined in
International Financial Reporting Standards (IFRS 9) and the guidelines issued by the Banco de Portugal through
Circular Letter CC/2018/00000062, in order to align the calculation process used in the Group with the best
international practices in this area.
As at 31\u00a0December 2025, the financial instruments subject to impairment requirements under IFRS 9, (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2025
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,914
829
\u2014
\u2014
861,743
Loans and advances to customers (note 22)
50,871,677
6,376,942
1,449,026
24,855
58,722,500
Debt instruments (note 23)
24,052,457
605,864
35,879
\u2014
24,694,200
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
1,183
\u2014
16,016,415
Guarantees and other commitments (note 46) (**)
16,256,245
1,682,805
311,324
861
18,251,235
Total
107,973,881
8,749,084
1,797,412
25,716
118,546,093
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
(Thousands of euros)
Category
2025
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
488
10
\u2014
\u2014
498
Loans and advances to customers (note 22)
252,249
296,302
759,614
7,660
1,315,825
Debt instruments (note 23)
28,878
92,651
33,796
\u2014
155,325
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,183
\u2014
1,183
Guarantees and other commitments (note 39)
30,425
23,353
92,378
\u2014
146,156
Total
312,040
412,316
886,971
7,660
1,618,987
(Thousands of euros)
Category
2025
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,426
819
\u2014
\u2014
861,245
Loans and advances to customers (note 22)
50,619,428
6,080,640
689,412
17,195
57,406,675
Debt instruments (note 23)
24,023,579
513,213
2,083
\u2014
24,538,875
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
\u2014
\u2014
16,015,232
Guarantees and other commitments (note 46) (**)
16,225,820
1,659,452
218,946
861
18,105,079
Total
107,661,841
8,336,768
910,441
18,056
116,927,106
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
As at 31\u00a0December 2024, the financial instruments subject to impairment requirements under IFRS 9 (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2024
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,647
\u2014
\u2014
\u2014
797,647
Loans and advances to customers (note 22)
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Debt instruments (note 23)
21,331,504
68,499
4,449
\u2014
21,404,452
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
1,169
\u2014
12,873,806
Guarantees and other commitments (note 46) (**)
15,758,606
1,197,255
322,087
2,790
17,280,738
Total
97,443,191
8,150,841
2,124,346
32,057
107,750,435
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
(Thousands of euros)
Category
2024
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
112
\u2014
\u2014
\u2014
112
Loans and advances to customers (note 22)
240,621
265,341
969,138
11,634
1,486,734
Debt instruments (note 23)
55,407
641
3,233
\u2014
59,281
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,169
\u2014
1,169
Guarantees and other commitments (note 39)
13,831
15,261
88,947
\u2014
118,039
Total
309,971
281,243
1,062,487
11,634
1,665,335
(Thousands of euros)
Category
2024
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,535
\u2014
\u2014
\u2014
797,535
Loans and advances to customers (note 22)
46,442,176
6,619,746
827,503
17,633
53,907,058
Debt instruments (note 23)
21,276,097
67,858
1,216
\u2014
21,345,171
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
\u2014
\u2014
12,872,637
Guarantees and other commitments (note 46) (**)
15,744,775
1,181,994
233,140
2,790
17,162,699
Total
97,133,220
7,869,598
1,061,859
20,423
106,085,100
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as
follows:
(Thousands of euros)
2025
2024
Financial assets held for trading (note 24)
Debt instruments
791,310
1,259,178
Derivatives
168,266
404,252
Financial assets designated at fair value through profit or loss - Debt instruments (note
24)
\u2014
33,894
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
228,652
236,346
Hedging derivatives (note 25)
32,365
69,349
Total
1,220,593
2,003,019
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2025, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,391,263)
2,391,263
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(260,957)
\u2014
260,957
\u2014
\u2014
Transfers from stage 2 to stage 1
2,357,970
(2,357,970)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(356,580)
356,580
\u2014
\u2014
Transfers from stage 3 to stage 1
48,989
\u2014
(48,989)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
176,041
(176,041)
\u2014
\u2014
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
4,434,611
(360,315)
(676,956)
(2,470)
3,394,870
Gross amount at the end of the year
50,871,677
6,376,942
1,449,026
24,855
58,722,500
During 2025, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
240,621
265,341
969,138
11,634
1,486,734
Change in impairment losses:
Transfer to Stage 1
61,397
(51,481)
(9,864)
(52)
\u2014
Transfer to Stage 2
(19,960)
70,779
(50,819)
\u2014
\u2014
Transfer to Stage 3
(4,783)
(35,016)
40,066
(267)
\u2014
Changes occurred due to changes in credit risk
(54,671)
32,959
180,404
332
159,024
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Changes due to new financial assets and
derecognised financial assets and other variations
30,115
14,304
(306,145)
(2,045)
(263,771)
Impairment losses at the end of the year
252,249
296,302
759,614
7,660
1,315,825
During 2024, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
45,651,670
7,290,622
1,914,768
30,749
54,887,809
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,071,117)
2,071,117
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(297,555)
\u2014
297,555
\u2014
\u2014
Transfers from stage 2 to stage 1
1,958,521
(1,958,521)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(420,581)
420,581
\u2014
\u2014
Transfers from stage 3 to stage 1
26,670
\u2014
(26,670)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
128,195
(128,195)
\u2014
\u2014
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Net balance of new financial assets and
derecognised financial assets and other variations
1,417,722
(222,759)
(591,235)
(14)
603,714
Gross amount at the end of the year
46,682,797
6,885,087
1,796,641
29,267
55,393,792
During 2024, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
268,948
291,752
1,007,481
14,469
1,582,650
Change in impairment losses:
Transfer to Stage 1
63,989
(57,318)
(6,549)
(122)
\u2014
Transfer to Stage 2
(13,493)
45,311
(31,818)
\u2014
\u2014
Transfer to Stage 3
(5,250)
(40,730)
46,185
(205)
\u2014
Changes occurred due to changes in credit risk
(98,325)
19,729
240,744
979
163,127
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Changes due to new financial assets and derecognised
financial assets and other variations
27,866
9,583
(196,742)
(2,019)
(161,312)
Impairment losses at the end of the year
240,621
265,341
969,138
11,634
1,486,734
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based
on expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2025
2024
Amortised cost before changes
224,554
235,601
Impairment losses before changes
52,857
31,971
Net amortised cost before changes
277,411
267,572
Net gain/loss arising on changes
(9,097)
(5,338)
Net amortised cost after changes
268,314
262,234
The financial assets changed since the initial recognition at a time when the impairment loss was measured based
on the expected credit losses lifetime, are analysed as follows:
(Thousands of euros)
Financial assets changed
2025
2024
Amortised cost of financial assets for which credit losses expected to go from \"lifetime\" to
12 months
65,180
71,287
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
27,912,683
1,724,254
164,858
63,735
1,952,847
243,962
133,169
377,131
8,151
30,250,812
Individuals-Other
10,293,222
1,112,561
119,694
47,582
1,279,837
179,123
312,892
492,015
8,562
12,073,636
Financial Companies
3,469,121
471,063
1,889
34
472,986
14,565
2,213
16,778
\u2014
3,958,885
Non-financial companies -
Corporate
9,556,611
1,010,324
12,425
1,096
1,023,845
139,011
53,567
192,578
117
10,773,151
Non-financial companies -
SME-Corporate
9,378,672
1,782,468
11,756
12,078
1,806,302
315,449
119,290
434,739
5,900
11,625,613
Non-financial companies -
SME-Retail
7,169,460
1,178,965
94,826
25,340
1,299,131
128,889
117,746
246,635
2,986
8,718,212
Non-financial companies -
Other
3,172,509
33,787
\u2014
\u2014
33,787
31,431
4,922
36,353
\u2014
3,242,649
Other loans
21,089,015
709,238
\u2014
88,467
797,705
\u2014
\u2014
\u2014
\u2014
21,886,720
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Individuals-Mortgages
9,111
16,736
4,302
3,328
24,366
72,363
46,612
118,975
3,575
156,027
Individuals-Other
82,776
66,824
18,745
13,697
99,266
84,033
220,900
304,933
4,085
491,060
Financial Companies
17,774
6,690
92
2
6,784
12,651
1,120
13,771
\u2014
38,329
Non-financial companies -
Corporate
41,456
32,864
414
72
33,350
72,516
25,273
97,789
\u2014
172,595
Non-financial companies -
SME-Corporate
62,270
63,127
746
1,574
65,447
139,954
75,533
215,487
\u2014
343,204
Non-financial companies -
SME-Retail
70,155
58,625
6,371
4,240
69,236
46,642
54,102
100,744
\u2014
240,135
Non-financial companies -
Other
11,301
466
\u2014
\u2014
466
29,384
4,705
34,089
\u2014
45,856
Other loans
17,197
94,751
\u2014
18,650
113,401
\u2014
\u2014
\u2014
\u2014
130,598
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Individuals-Mortgages
27,903,572
1,707,518
160,556
60,407
1,928,481
171,599
86,557
258,156
4,576
30,094,785
Individuals-Other
10,210,446
1,045,737
100,949
33,885
1,180,571
95,090
91,992
187,082
4,477
11,582,576
Financial Companies
3,451,347
464,373
1,797
32
466,202
1,914
1,093
3,007
\u2014
3,920,556
Non-financial companies -
Corporate
9,515,155
977,460
12,011
1,024
990,495
66,495
28,294
94,789
117
10,600,556
Non-financial companies -
SME-Corporate
9,316,402
1,719,341
11,010
10,504
1,740,855
175,495
43,757
219,252
5,900
11,282,409
Non-financial companies -
SME-Retail
7,099,305
1,120,340
88,455
21,100
1,229,895
82,247
63,644
145,891
2,986
8,478,077
Non-financial companies -
Other
3,161,208
33,321
\u2014
\u2014
33,321
2,047
217
2,264
\u2014
3,196,793
Other loans
21,071,818
614,487
\u2014
69,817
684,304
\u2014
\u2014
\u2014
\u2014
21,756,122
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Individuals-Mortgages
0.03%
0.97%
2.61%
5.22%
1.25%
29.66%
35.00%
31.55%
43.86%
0.52%
Individuals-Other
0.80%
6.01%
15.66%
28.79%
7.76%
46.91%
70.60%
61.98%
47.71%
4.07%
Financial Companies
0.51%
1.42%
4.87%
5.88%
1.43%
86.86%
50.61%
82.08%
0.00%
0.97%
Non-financial companies -
Corporate
0.43%
3.25%
3.33%
6.57%
3.26%
52.17%
47.18%
50.78%
0.00%
1.60%
Non-financial companies -
SME-Corporate
0.66%
3.54%
6.35%
13.03%
3.62%
44.37%
63.32%
49.57%
0.00%
2.95%
Non-financial companies -
SME-Retail
0.98%
4.97%
6.72%
16.73%
5.33%
36.19%
45.95%
40.85%
0.00%
2.75%
Non-financial companies -
Other
0.36%
1.38%
0.00%
0.00%
1.38%
93.49%
95.59%
93.77%
0.00%
1.41%
Other loans
0.08%
13.36%
0.00%
21.08%
14.22%
0.00%
0.00%
0.00%
0.00%
0.60%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
25,410,533
2,531,556
198,053
85,589
2,815,198
284,617
162,464
447,081
10,005
28,682,817
Individuals-Other
9,297,921
1,181,727
126,969
52,644
1,361,340
239,235
327,737
566,972
11,793
11,238,026
Financial Companies
3,450,266
40,675
5
17
40,697
13,035
15
13,050
\u2014
3,504,013
Non-financial companies -
Corporate
11,151,305
716,267
6,363
49
722,679
159,996
39,604
199,600
5,226
12,078,810
Non-financial companies -
SME-Corporate
9,034,618
1,762,243
22,710
9,089
1,794,042
499,686
122,876
622,562
1,605
11,452,827
Non-financial companies -
SME-Retail
6,524,804
1,077,758
31,069
21,154
1,129,981
117,188
155,779
272,967
3,428
7,931,180
Non-financial companies -
Other
548,529
21,754
\u2014
\u2014
21,754
\u2014
500
500
\u2014
570,783
Other loans
19,152,578
263,254
335
1,561
265,150
445
\u2014
445
\u2014
19,418,173
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Individuals-Mortgages
11,712
24,030
4,054
3,446
31,530
66,785
57,269
124,054
4,482
171,778
Individuals-Other
61,763
56,698
19,156
12,863
88,717
104,205
228,644
332,849
6,883
490,212
Financial Companies
21,558
2,072
1
2
2,075
12,448
9
12,457
\u2014
36,090
Non-financial companies -
Corporate
41,412
20,142
34
4
20,180
90,639
18,505
109,144
269
171,005
Non-financial companies -
SME-Corporate
41,250
56,922
3,852
2,204
62,978
283,615
56,392
340,007
\u2014
444,235
Non-financial companies -
SME-Retail
79,907
64,710
3,220
3,252
71,182
72,307
70,111
142,418
\u2014
293,507
Non-financial companies -
Other
651
27
\u2014
\u2014
27
\u2014
272
272
\u2014
950
Other loans
51,718
4,260
14
280
4,554
117
\u2014
117
\u2014
56,389
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Individuals-Mortgages
25,398,821
2,507,526
193,999
82,143
2,783,668
217,832
105,195
323,027
5,523
28,511,039
Individuals-Other
9,236,158
1,125,029
107,813
39,781
1,272,623
135,030
99,093
234,123
4,910
10,747,814
Financial Companies
3,428,708
38,603
4
15
38,622
587
6
593
\u2014
3,467,923
Non-financial companies -
Corporate
11,109,893
696,125
6,329
45
702,499
69,357
21,099
90,456
4,957
11,907,805
Non-financial companies -
SME-Corporate
8,993,368
1,705,321
18,858
6,885
1,731,064
216,071
66,484
282,555
1,605
11,008,592
Non-financial companies -
SME-Retail
6,444,897
1,013,048
27,849
17,902
1,058,799
44,881
85,668
130,549
3,428
7,637,673
Non-financial companies -
Other
547,878
21,727
\u2014
\u2014
21,727
\u2014
228
228
\u2014
569,833
Other loans
19,100,860
258,994
321
1,281
260,596
328
\u2014
328
\u2014
19,361,784
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Individuals-Mortgages
0.05%
0.95%
2.05%
4.03%
1.12%
23.46%
35.25%
27.75%
44.80%
0.60%
Individuals-Other
0.66%
4.80%
15.09%
24.43%
6.52%
43.56%
69.76%
58.71%
58.37%
4.36%
Financial Companies
0.62%
5.09%
20.00%
11.76%
5.10%
95.50%
60.00%
95.46%
0.00%
1.03%
Non-financial companies -
Corporate
0.37%
2.81%
0.53%
8.16%
2.79%
56.65%
46.73%
54.68%
5.15%
1.42%
Non-financial companies -
SME-Corporate
0.46%
3.23%
16.96%
24.25%
3.51%
56.76%
45.89%
54.61%
0.00%
3.88%
Non-financial companies -
SME-Retail
1.22%
6.00%
10.36%
15.37%
6.30%
61.70%
45.01%
52.17%
0.00%
3.70%
Non-financial companies -
Other
0.12%
0.12%
0.00%
0.00%
0.12%
0.00%
54.40%
54.40%
0.00%
0.17%
Other loans
0.27%
1.62%
4.18%
17.94%
1.72%
26.29%
0.00%
26.29%
0.00%
0.29%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past
due <=
30 days
Days
past
due >
30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Loans to individuals
38,205,905
2,836,815
284,552
111,317
3,232,684
423,085
446,061
869,146
16,713
42,324,448
Non-financial companies -
Trade
5,761,596
825,034
16,753
7,939
849,726
63,983
60,891
124,874
594
6,736,790
Non-financial companies -
Construction
3,025,258
491,950
13,816
3,764
509,530
226,993
31,456
258,449
640
3,793,877
Non-financial companies -
Manufacturing industries
5,898,525
866,217
17,949
4,764
888,930
137,782
125,158
262,940
4,712
7,055,107
Non-financial companies -
Other activities
2,503,502
308,930
6,024
1,650
316,604
17,510
12,076
29,586
16
2,849,708
Non-financial companies -
Other services
12,088,371
1,513,413
64,465
20,397
1,598,275
168,512
65,944
234,456
3,041
13,924,143
Other Services /Other
activities
24,558,136
1,180,301
1,889
88,501
1,270,691
14,565
2,213
16,778
\u2014
25,845,605
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Loans to individuals
91,887
83,560
23,047
17,025
123,632
156,396
267,512
423,908
7,660
647,087
Non-financial companies -
Trade
32,237
27,470
1,207
1,323
30,000
23,077
26,655
49,732
\u2014
111,969
Non-financial companies -
Construction
16,448
11,203
1,106
690
12,999
80,248
16,689
96,937
\u2014
126,384
Non-financial companies -
Manufacturing industries
44,103
40,034
946
701
41,681
87,029
78,428
165,457
\u2014
251,241
Non-financial companies -
Other activities
12,409
12,921
303
265
13,489
7,860
6,927
14,787
\u2014
40,685
Non-financial companies -
Other services
79,985
63,454
3,969
2,907
70,330
90,282
30,914
121,196
\u2014
271,511
Other Services /Other
activities
34,971
101,441
92
18,652
120,185
12,651
1,120
13,771
\u2014
168,927
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Loans to individuals
38,114,018
2,753,255
261,505
94,292
3,109,052
266,689
178,549
445,238
9,053
41,677,361
Non-financial companies -
Trade
5,729,359
797,564
15,546
6,616
819,726
40,906
34,236
75,142
594
6,624,821
Non-financial companies -
Construction
3,008,810
480,747
12,710
3,074
496,531
146,745
14,767
161,512
640
3,667,493
Non-financial companies -
Manufacturing industries
5,854,422
826,183
17,003
4,063
847,249
50,753
46,730
97,483
4,712
6,803,866
Non-financial companies -
Other activities
2,491,093
296,009
5,721
1,385
303,115
9,650
5,149
14,799
16
2,809,023
Non-financial companies -
Other services
12,008,386
1,449,959
60,496
17,490
1,527,945
78,230
35,030
113,260
3,041
13,652,632
Other Services /Other
activities
24,523,165
1,078,860
1,797
69,849
1,150,506
1,914
1,093
3,007
\u2014
25,676,678
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Loans to individuals
0.24%
2.95%
8.10%
15.29%
3.82%
36.97%
59.97%
48.77%
45.83%
1.53%
Non-financial companies -
Trade
0.56%
3.33%
7.20%
16.66%
3.53%
36.07%
43.77%
39.83%
0.00%
1.66%
Non-financial companies -
Construction
0.54%
2.28%
8.01%
18.33%
2.55%
35.35%
53.06%
37.51%
0.00%
3.33%
Non-financial companies -
Manufacturing industries
0.75%
4.62%
5.27%
14.71%
4.69%
63.16%
62.66%
62.93%
0.00%
3.56%
Non-financial companies -
Other activities
0.50%
4.18%
5.03%
16.06%
4.26%
44.89%
57.36%
49.98%
0.00%
1.43%
Non-financial companies -
Other services
0.66%
4.19%
6.16%
14.25%
4.40%
53.58%
46.88%
51.69%
0.00%
1.95%
Other Services /Other
activities
0.14%
8.59%
4.87%
21.08%
9.46%
86.86%
50.61%
82.08%
0.00%
0.65%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit losses and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
34,708,454
3,713,283
325,022
138,233
4,176,538
523,852
490,201
1,014,053
21,798
39,920,843
Non-financial companies -
Trade
5,416,938
657,638
8,559
7,002
673,199
53,917
61,395
115,312
4,560
6,210,009
Non-financial companies -
Construction
2,670,497
394,218
6,546
4,854
405,618
248,140
36,340
284,480
2,155
3,362,750
Non-financial companies -
Manufacturing industries
5,483,661
794,421
14,995
6,037
815,453
146,620
82,064
228,684
924
6,528,722
Non-financial companies -
Other activities
2,345,455
305,401
3,469
2,144
311,014
23,924
16,458
40,382
104
2,696,955
Non-financial companies -
Other services
11,342,705
1,426,344
26,573
10,255
1,463,172
304,269
122,502
426,771
2,516
13,235,164
Other Services /Other
activities
22,602,844
303,929
340
1,578
305,847
13,480
15
13,495
\u2014
22,922,186
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Loans to individuals
73,475
80,728
23,210
16,309
120,247
170,990
285,913
456,903
11,365
661,990
Non-financial companies -
Trade
32,985
20,550
1,229
1,136
22,915
17,823
25,364
43,187
269
99,356
Non-financial companies -
Construction
12,726
7,819
1,011
1,247
10,077
113,102
18,993
132,095
\u2014
154,898
Non-financial companies -
Manufacturing industries
39,131
44,277
2,740
1,235
48,252
49,740
40,350
90,090
\u2014
177,473
Non-financial companies -
Other activities
8,248
14,122
291
540
14,953
9,519
9,738
19,257
\u2014
42,458
Non-financial companies -
Other services
70,130
55,033
1,835
1,302
58,170
256,377
50,835
307,212
\u2014
435,512
Other Services /Other
activities
73,276
6,332
15
282
6,629
12,565
9
12,574
\u2014
92,479
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Loans to individuals
34,634,979
3,632,555
301,812
121,924
4,056,291
352,862
204,288
557,150
10,433
39,258,853
Non-financial companies -
Trade
5,383,953
637,088
7,330
5,866
650,284
36,094
36,031
72,125
4,291
6,110,653
Non-financial companies -
Construction
2,657,771
386,399
5,535
3,607
395,541
135,038
17,347
152,385
2,155
3,207,852
Non-financial companies -
Manufacturing industries
5,444,530
750,144
12,255
4,802
767,201
96,880
41,714
138,594
924
6,351,249
Non-financial companies -
Other activities
2,337,207
291,279
3,178
1,604
296,061
14,405
6,720
21,125
104
2,654,497
Non-financial companies -
Other services
11,272,575
1,371,311
24,738
8,953
1,405,002
47,892
71,667
119,559
2,516
12,799,652
Other Services /Other
activities
22,529,568
297,597
325
1,296
299,218
915
6
921
\u2014
22,829,707
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Loans to individuals
0.21%
2.17%
7.14%
11.80%
2.88%
32.64%
58.33%
45.06%
52.14%
1.66%
Non-financial companies -
Trade
0.61%
3.12%
14.36%
16.22%
3.40%
33.06%
41.31%
37.45%
5.90%
1.60%
Non-financial companies -
Construction
0.48%
1.98%
15.44%
25.69%
2.48%
45.58%
52.26%
46.43%
0.00%
4.61%
Non-financial companies -
Manufacturing industries
0.71%
5.57%
18.27%
20.46%
5.92%
33.92%
49.17%
39.39%
0.00%
2.72%
Non-financial companies -
Other activities
0.35%
4.62%
8.39%
25.19%
4.81%
39.79%
59.17%
47.69%
0.00%
1.57%
Non-financial companies -
Other services
0.62%
3.86%
6.91%
12.70%
3.98%
84.26%
41.50%
71.99%
0.00%
3.29%
Other Services /Other
activities
0.32%
2.08%
4.41%
17.87%
2.17%
93.21%
60.00%
93.18%
0.00%
0.40%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025 , financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Geography
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Portugal
64,304,554
5,796,075
166,462
77,972
6,040,509
712,242
333,631
1,045,873
16,598
71,407,534
Poland
26,613,257
1,432,010
234,829
67,639
1,734,478
333,419
384,880
718,299
9,118
29,075,152
Mozambique
1,123,482
794,575
4,157
92,721
891,453
6,769
25,288
32,057
\u2014
2,046,992
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment
Portugal
196,675
190,342
8,916
8,956
208,214
315,589
172,412
488,001
\u2014
892,890
Poland
109,034
53,120
21,033
13,097
87,250
138,838
240,733
379,571
7,660
583,515
Mozambique
6,331
96,621
721
19,510
116,852
3,116
15,100
18,216
\u2014
141,399
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Portugal
64,107,879
5,605,733
157,546
69,016
5,832,295
396,653
161,219
557,872
16,598
70,514,644
Poland
26,504,223
1,378,890
213,796
54,542
1,647,228
194,581
144,147
338,728
1,458
28,491,637
Mozambique
1,117,151
697,954
3,436
73,211
774,601
3,653
10,188
13,841
\u2014
1,905,593
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment
coverage
Portugal
0.31%
3.28%
5.36%
11.49%
3.45%
44.31%
51.68%
46.66%
0.00%
1.25%
Poland
0.41%
3.71%
8.96%
19.36%
5.03%
41.64%
62.55%
52.84%
84.01%
2.01%
Mozambique
0.56%
12.16%
17.34%
21.04%
13.11%
46.03%
59.71%
56.82%
0.00%
6.91%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
58,473,777
5,846,367
216,085
102,395
6,164,847
918,541
356,047
1,274,588
13,881
65,927,093
Poland
24,622,516
1,380,971
160,546
61,255
1,602,772
391,388
420,892
812,280
18,176
27,055,744
Mozambique
1,474,261
367,896
8,873
6,453
383,222
4,273
32,036
36,309
\u2014
1,893,792
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment
Portugal
184,443
174,794
11,245
9,943
195,982
473,433
146,705
620,138
\u2014
1,000,563
Poland
86,667
48,884
18,436
10,769
78,089
155,362
266,152
421,514
11,634
597,904
Mozambique
38,861
5,183
650
1,339
7,172
1,321
18,345
19,666
\u2014
65,699
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Portugal
58,289,334
5,671,573
204,840
92,452
5,968,865
445,108
209,342
654,450
13,881
64,926,530
Poland
24,535,849
1,332,087
142,110
50,486
1,524,683
236,026
154,740
390,766
6,542
26,457,840
Mozambique
1,435,400
362,713
8,223
5,114
376,050
2,952
13,691
16,643
\u2014
1,828,093
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment
coverage
Portugal
0.32%
2.99%
5.20%
9.71%
3.18%
51.54%
41.20%
48.65%
0.00%
1.52%
Poland
0.35%
3.54%
11.48%
17.58%
4.87%
39.70%
63.24%
51.89%
64.01%
2.21%
Mozambique
2.64%
1.41%
7.33%
20.75%
1.87%
30.92%
57.26%
54.16%
0.00%
3.47%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2025
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
61,696,215
9,954,383
2,363,743
6,717
1,763,989
75,785,047
281,615
75,503,432
stage 2
1,226,273
2,864,442
2,112,262
335,072
445,587
6,983,636
388,963
6,594,673
stage 3
400
1,559
398
1,462,354
20,194
1,484,905
793,411
691,494
POCI
3,191
2,339
1,865
17,460
1
24,856
7,660
17,196
62,926,079
12,822,723
4,478,268
1,821,603
2,229,771
84,278,444
1,471,649
82,806,795
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
13,388,007
5,017
\u2014
\u2014
2,539,564
15,932,588
\u2014
15,932,588
stage 2
7,702
74,942
\u2014
\u2014
\u2014
82,644
\u2014
15,932,588
stage 3
\u2014
\u2014
\u2014
\u2014
1,183
1,183
1,183
\u2014
13,395,709
79,959
\u2014
\u2014
2,540,747
16,016,415
1,183
16,015,232
Guarantees and other
commitments (**)
stage 1
11,546,206
3,741,469
687,219
755
280,597
16,256,246
30,425
16,225,821
stage 2
485,675
402,580
410,615
17,358
366,576
1,682,804
23,353
1,659,451
stage 3
3
24
84
311,080
133
311,324
92,377
218,947
POCI
52
1
2
806
\u2014
861
\u2014
861
12,031,936
4,144,074
1,097,920
329,999
647,306
18,251,235
146,155
18,105,080
Total
88,353,724
17,046,756
5,576,188
2,151,602
5,417,824
118,546,094
1,618,987
116,927,107
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2024, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2024
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
54,782,294
9,856,040
2,681,861
620
1,491,131
68,811,946
296,140
68,515,806
stage 2
1,781,656
2,210,946
2,208,958
427,453
324,574
6,953,587
265,982
6,687,605
stage 3
193
1,608
737
1,772,838
25,715
1,801,091
972,371
828,720
POCI
2,700
2,384
1,358
22,792
32
29,266
11,634
17,632
56,566,843
12,070,978
4,892,914
2,223,703
1,841,452
77,595,890
1,546,127
76,049,763
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
12,735,540
\u2014
\u2014
\u2014
137,096
12,872,636
\u2014
12,872,636
stage 3
\u2014
\u2014
\u2014
\u2014
1,169
1,169
1,169
\u2014
12,735,540
\u2014
\u2014
\u2014
138,265
12,873,805
1,169
12,872,636
Guarantees and other
commitments (**)
stage 1
11,380,949
3,218,006
785,001
3
374,649
15,758,608
13,831
15,744,777
stage 2
207,462
408,214
393,070
22,586
165,922
1,197,254
15,261
1,181,993
stage 3
3
19
\u2014
321,943
121
322,086
88,947
233,139
POCI
4
2
1
2,783
\u2014
2,790
\u2014
2,790
11,588,418
3,626,241
1,178,072
347,315
540,692
17,280,738
118,039
17,162,699
Total
80,890,801
15,697,219
6,070,986
2,571,018
2,520,409
107,750,433
1,665,335
106,085,098
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
24,013
30,226,799
30,250,812
7,945
148,082
156,027
Individuals - Other
6,596
12,067,040
12,073,636
3,860
487,200
491,060
Financial Companies
13,833
3,945,052
3,958,885
12,986
25,343
38,329
Non-financial companies-Corporate
154,023
10,619,128
10,773,151
89,870
82,725
172,595
Non-financial companies-SME-
Corporate
261,218
11,364,395
11,625,613
162,761
180,443
343,204
Non-financial companies-SME-Retail
31,409
8,686,803
8,718,212
19,874
220,261
240,135
Non-financial companies-Other
36,352
3,206,297
3,242,649
34,090
11,766
45,856
Other loans
\u2014
21,886,720
21,886,720
\u2014
130,598
130,598
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
28,581
28,654,236
28,682,817
9,285
162,493
171,778
Individuals - Other
8,130
11,229,896
11,238,026
4,839
485,373
490,212
Financial Companies
12,658
3,491,355
3,504,013
12,297
23,793
36,090
Non-financial companies-Corporate
184,831
11,893,979
12,078,810
102,207
68,798
171,005
Non-financial companies-SME-
Corporate
409,804
11,043,023
11,452,827
277,360
166,875
444,235
Non-financial companies -SME - Retail
32,522
7,898,658
7,931,180
61,815
231,692
293,507
Non-financial companies-Other
500
570,283
570,783
272
678
950
Other loans
\u2014
19,418,173
19,418,173
\u2014
56,389
56,389
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
30,609
42,293,839
42,324,448
11,805
635,282
647,087
Non-financial companies-Trade
40,995
6,695,795
6,736,790
22,484
89,485
111,969
Non-financial companies-Construction
154,347
3,639,530
3,793,877
70,384
56,000
126,384
Non-financial companies-Manufacturing
industry
155,378
6,899,729
7,055,107
122,836
128,405
251,241
Non-financial companies-Other activities
13,008
2,836,700
2,849,708
7,981
32,704
40,685
Non-financial companies-Other services
119,274
13,804,869
13,924,143
82,910
188,601
271,511
Other Services/Other activities
13,833
25,831,772
25,845,605
12,986
155,941
168,927
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
36,711
39,884,132
39,920,843
14,124
647,866
661,990
Non-financial companies-Trade
31,532
6,178,477
6,210,009
11,538
87,818
99,356
Non-financial companies-Construction
188,453
3,174,297
3,362,750
110,151
44,747
154,898
Non-financial companies-Manufacturing
industry
101,395
6,427,327
6,528,722
44,047
133,426
177,473
Non-financial companies-Other activities
18,033
2,678,922
2,696,955
11,909
30,549
42,458
Non-financial companies-Other services
288,244
12,946,920
13,235,164
264,009
171,503
435,512
Other Services/Other activities
12,658
22,909,528
22,922,186
12,297
80,182
92,479
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
387,544
71,019,990
71,407,534
279,596
613,294
892,890
Poland
127,879
28,947,273
29,075,152
45,469
538,046
583,515
Mozambique
12,021
2,034,971
2,046,992
6,321
135,078
141,399
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
499,966
65,427,127
65,927,093
411,589
588,974
1,000,563
Poland
163,443
26,892,301
27,055,744
49,694
548,210
597,904
Mozambique
13,617
1,880,175
1,893,792
6,792
58,907
65,699
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to
individual analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31\u00a0December 2025, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2025
Year of production
Construction
and Commercial
Real Estate
Companies -
Other Activities
Mortgages
Individuals -
Other
Other
loans
Total
2015 and previous
Number of operations
13,971
32,750
229,682
683,541
421
960,365
Amount (EUR '000)
849,839
3,557,234
7,093,943
1,369,473
239,846
13,110,335
Impairment constituted (EUR '000)
70,756
65,253
84,077
29,715
2,295
252,096
2016
Number of operations
1,576
6,487
8,800
81,234
58
98,155
Amount (EUR '000)
89,734
861,158
411,126
167,116
2,443
1,531,577
Impairment constituted (EUR '000)
1,621
8,371
4,652
8,090
78
22,812
2017
Number of operations
1,885
7,260
14,310
91,995
318
115,768
Amount (EUR '000)
91,755
727,192
788,409
185,226
4,601
1,797,183
Impairment constituted (EUR '000)
4,169
10,994
6,887
10,374
302
32,726
2018
Number of operations
3,289
10,303
19,282
167,005
198
200,077
Amount (EUR '000)
303,634
1,550,329
1,219,319
356,944
170,361
3,600,587
Impairment constituted (EUR '000)
7,212
24,450
9,317
20,830
564
62,373
2019
Number of operations
5,093
12,111
21,941
389,036
177
428,358
Amount (EUR '000)
237,398
1,380,556
1,484,350
671,144
8,735
3,782,183
Impairment constituted (EUR '000)
4,723
24,536
8,693
35,051
287
73,290
2020
Number of operations
5,377
18,124
26,702
145,489
167
195,859
Amount (EUR '000)
309,033
1,375,805
1,843,019
313,927
13,884
3,855,668
Impairment constituted (EUR '000)
12,140
16,869
9,681
23,568
941
63,199
2021
Number of operations
6,109
21,032
38,974
193,999
214
260,328
Amount (EUR '000)
336,007
1,636,125
2,994,728
501,631
158,365
5,626,856
Impairment constituted (EUR '000)
5,249
24,429
11,922
42,987
1,604
86,191
2022
Number of operations
7,038
24,377
28,074
287,516
234
347,239
Amount (EUR '000)
605,074
2,284,241
2,546,466
807,341
20,258
6,263,380
Impairment constituted (EUR '000)
5,901
26,408
7,007
54,936
1,033
95,285
2023
Number of operations
8,584
29,671
25,183
391,892
489
455,819
Amount (EUR '000)
1,033,572
2,537,056
2,463,206
1,063,457
69,089
7,166,380
Impairment constituted (EUR '000)
12,566
38,288
5,104
65,701
569
122,228
2024
Number of operations
10,454
35,689
35,879
543,138
1,691
626,851
Amount (EUR '000)
1,379,732
3,879,212
4,040,851
1,805,476
124,652
11,229,923
Impairment constituted (EUR '000)
13,881
73,252
5,941
78,432
793
172,299
2025
Number of operations
16,372
73,191
38,659
1,416,963
1,305
1,546,490
Amount (EUR '000)
2,584,307
9,782,219
5,520,407
3,949,943
132,075
21,968,951
Impairment constituted (EUR '000)
23,594
243,815
5,524
71,902
2,468
347,303
Total
Number of operations
79,748
270,995
487,486
4,391,808
5,272
5,235,309
Amount (EUR '000)
7,820,085
29,571,127
30,405,824
11,191,678
944,309
79,933,023
Impairment constituted (EUR '000)
161,812
556,665
158,805
441,586
10,934
1,329,802
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
As at 31\u00a0December 2024, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2024
Year of production
Construction
and Commercial
Real Estate
Companies -
Other
Activities
Mortgages
Individuals -
Other
Other
loans
Total
2014 and previous
Number of operations
14,156
29,534
252,970
668,544
730
965,934
Amount (EUR '000)
896,754
3,183,643
7,756,515
1,305,814
254,286
13,397,012
Impairment constituted (EUR '000)
78,530
52,663
100,158
27,346
1,621
260,318
2015
Number of operations
1,581
6,354
8,748
76,703
161
93,547
Amount (EUR '000)
84,592
497,077
407,678
134,673
2,955
1,126,975
Impairment constituted (EUR '000)
1,495
18,949
5,031
7,484
533
33,492
2016
Number of operations
1,807
7,290
9,811
98,126
173
117,207
Amount (EUR '000)
118,163
946,970
468,327
182,369
2,472
1,718,301
Impairment constituted (EUR '000)
1,595
10,080
5,726
12,138
145
29,684
2017
Number of operations
2,191
8,306
16,035
108,278
556
135,366
Amount (EUR '000)
121,934
792,998
903,737
204,274
5,942
2,028,885
Impairment constituted (EUR '000)
4,756
13,468
7,472
14,679
326
40,701
2018
Number of operations
3,880
12,010
21,342
195,982
357
233,571
Amount (EUR '000)
348,049
1,717,047
1,385,196
426,990
291,719
4,169,001
Impairment constituted (EUR '000)
5,185
18,602
9,535
30,198
878
64,398
2019
Number of operations
6,077
15,879
24,524
437,421
312
484,213
Amount (EUR '000)
379,403
1,390,533
1,701,878
816,725
50,025
4,338,564
Impairment constituted (EUR '000)
5,390
38,613
8,242
50,635
851
103,731
2020
Number of operations
7,221
25,512
29,793
205,882
355
268,763
Amount (EUR '000)
557,772
1,983,167
2,115,840
445,438
43,465
5,145,682
Impairment constituted (EUR '000)
12,161
33,067
9,626
32,906
1,620
89,380
2021
Number of operations
8,038
27,455
43,540
254,064
365
333,462
Amount (EUR '000)
554,664
1,927,360
3,439,789
728,043
284,772
6,934,628
Impairment constituted (EUR '000)
8,245
36,582
11,137
58,648
1,782
116,394
2022
Number of operations
8,953
30,755
31,844
394,452
443
466,447
Amount (EUR '000)
1,011,708
3,225,162
2,976,052
1,183,881
48,900
8,445,703
Impairment constituted (EUR '000)
10,394
49,175
5,672
72,621
1,548
139,410
2023
Number of operations
10,212
33,388
29,257
608,249
723
681,829
Amount (EUR '000)
1,480,507
2,773,296
2,970,331
1,716,879
96,858
9,037,871
Impairment constituted (EUR '000)
16,315
40,737
4,197
74,391
933
136,573
2024
Number of operations
14,366
126,180
39,644
1,311,647
2,976
1,494,813
Amount (EUR '000)
2,029,470
6,918,957
4,568,010
3,397,754
298,452
17,212,643
Impairment constituted (EUR '000)
13,463
214,703
6,071
75,276
4,619
314,132
Total
Number of operations
78,482
322,663
507,508
4,359,348
7,151
5,275,152
Amount (EUR '000)
7,583,016
25,356,210
28,693,353
10,542,840
1,379,846
73,555,265
Impairment constituted (EUR '000)
157,529
526,639
172,867
456,322
14,856
1,328,213
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
Demand
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
\u2014
\u2014
\u2014
4,089,540
Loans and advances to Credit
Institutions - Repayable on demand
186,011
\u2014
\u2014
\u2014
\u2014
\u2014
186,011
Other loans and advances (a)
\u2014
819,520
27,965
14,258
\u2014
\u2014
861,743
Loans and advances to customers (a)
\u2014
\u2014
8,846,738
14,060,004
35,227,857
587,901
58,722,500
Other financial assets (b)
\u2014
3,942,680
2,116,949
8,975,393
1,990,205
428,206
17,453,433
4,275,551
4,762,200
10,991,652
23,049,655
37,218,062
1,016,107
81,313,227
Liabilities
Deposits from Credit Institutions
\u2014
822,187
55,986
398
\u2014
\u2014
878,571
Deposits from costumers
53,469,091
24,744,000
9,255,155
204,614
\u2014
\u2014
87,672,860
Debt securities issued
\u2014
\u2014
\u2014
3,144,400
749,193
\u2014
3,893,593
Subordinated debt
\u2014
\u2014
\u2014
455,668
955,990
\u2014
1,411,658
53,469,091
25,566,187
9,311,141
3,805,080
1,705,183
\u2014
93,856,682
(a) Gross of impairment
(b) Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
Operational Risk
Operational risk management is a strategic pilar for the Group\u2019s resilience and sustainability. It is structured in
accordance with the \u201cthree Lines of Defence\u201d Corporate Governance model and supported by an integrated end-
to-end process view, ensuring a holistic approach to the identification, assessment and mitigation of operational
risks. This framework not only strengthens internal control mechanisms but also supports initiatives aimed at
enhancing operational efficiency and reinforcing business continuity management.
The First Line of Defence, composed of process owners and process managers, is responsible for the day-to-day
management of operational risk. In addition to ensuring the effectiveness and efficiency of processes, it is
responsible for identifying, recording and analysing operational losses, monitoring the relevant Key Risk Indicators
(KRIs), conducting Risk Self-Assessment (RSA) exercises, and defining and implementing appropriate mitigation
measures to address operational risk exposures. These actions are subject to periodic review, ensuring continuous
alignment between the Group\u2019s risk profile and business evolution, as well as the ongoing strengthening of the
internal control environment.
The Second Line of Defence, represented by the Risk Office and the Compliance Office, provides oversight,
monitoring and effective challenge of the First Line\u2019s activities. The Third Line of Defence, Internal Audit,
independently assesses the adequacy, effectiveness and compliance of the overall operational risk management
framework, ensuring its proper functioning.
Throughout 2025, the various stakeholders involved in operational risk management continued to perform the
standard risk management activities, ensuring the efficient and systematic identification, assessment, mitigation
and control of risk exposures, as well as the appropriate reporting to the Group\u2019s governing bodies and to
regulatory authorities.
The results of the RSA exercises continue to evidence a robust control environment, demonstrating the Group\u2019s
strong commitment to operational risk management through the continuous development of improvement
initiatives aimed at mitigating risk exposures. The pattern of recorded operational losses remained within normal
and expected levels.
Ongoing KRI monitoring has enabled the identification of improvement opportunities which, combined with RSA
exercises and the operational loss identification and recording process, support effective and proactive risk
management.
The Group\u2019s transformation strategy, focused on digitalisation and the integration of new technologies, introduces
significant operational risk challenges. Key priorities include strengthening the security of digital banking
channels, enhancing fraud prevention and detection mechanisms, reinforcing the ICT risk management
framework, ensuring robust personal data governance, and maintaining strict compliance with legally required
information duties in digital sales channels.
Covenants
The contractual terms of instruments of various wholesale funding instruments encompass obligations assumed
by entities belonging to the Group as borrowers or issuers, concerning general duties of corporate conduct,
maintenance of banking activity and the in existence of special guarantees constituted for the benefit of other
creditors (\u201cnegative pledge\u201d). These terms essentially reflect the internationally adopted standards for each of the
types of debt instruments used by the Group.
The terms of the Group\u2019s intervention in rated securitisation transactions involving its own assets are subject to
changes in case the Group triggers certain rating criteria. The criteria established in each transaction results
mainly from the analysis performed at the moment that the transaction was structured, being usually applied by
each rating agency in a standardised way to the securitisation transactions involving the same type of assets.
Regarding the Covered Bond Programmes of Banco Comercial Portugu\u00eas, there are no relevant covenants
related to a possible downgrade of BCP.
Hedge accounting
The detailed information of the strategies, hedge transactions, hedged items and hedging instruments applied by
the Group, is shown in a table below:
Strategy
Description of hedge transactions
Hedged items
Hedging
instruments
Cash flow volatility hedge of
the flows generated by the
portfolio of EUR floating rate
mortgage loans (a)
Group hedges the risk of the volatility of interest
payments from floating rate mortgages. The
volatility of cash flows results from interest rate risk
Floating rate mortgage loans (BCP
S.A.)
Interest Rate
Swap (IRS)
transactions
Cash flow volatility hedge due
to future income and interest
costs denominated in foreign
currencies (a)
The Group hedges the risk of the volatility of cash
flows generated by income and interest costs
denominated in foreign currencies. The volatility of
cash flows results from the currency risk
Cash flows resulting from income
and interest costs denominated in
foreign currencies (Bank
Millennium S.A.)
FX position
transactions
Cash flow volatility hedge for
the flows generated by FX
mortgage portfolio and its
underlying PLN liabilities (a)
The Group hedges the risk of the volatility of cash
flows generated by FX mortgages and by PLN
liabilities financially underlying such loans. The
volatility of cash flows results from the currency risk
and interest rate risk
Cash flows resulting from the FX
mortgage loan portfolio and PLN
deposits together with issued debt
PLN securities funding them (Bank
Millennium S.A.)
CIRS
transactions
Hedge of volatility of the cash
flows generated by PLN
denominated financial assets
(a)
The Group hedges the risk of the volatility of cash
flows generated by PLN denominated financial
assets. The volatility of cash flows results from
interest rate risk
Cash flows resulting from PLN
denominated financial assets (Bank
Millennium S.A.)
IRS
transactions
Fair value hedge of fixed rate
loans (a)
Group hedges changes in the fair value of cash
flows of fixed rate loans due to changes in market
interest rates
Fixed rate loans (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at amortised cost
(BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments in EUR (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at fair value
through other comprehensive
income (BCP S.A. and ActivoBank
S.A.)
IRS
transactions
Fair value hedge of fixed rate
issued debt instruments in EUR
(a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate Issued debt (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Term deposits (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (macro hedge)
(a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Repayable demand deposits
without maturity (BCP S.A. and
ActivoBank S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in USD (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in foreign exchange and in
market interest rates
Term deposits (BCP S.A.)
CIRS
transactions
Fair value hedge of a fixed
interest rate debt instrument
(macro hedge) (a)
The Group hedges part of the interest rate risk
associated with the change in the fair value of a
fixed-rate debt instrument recorded in other
comprehensive income, resulting from fluctuations
in market interest rate
A portfolio of fixed coupon debt
securities classified as financial
assets measured at fair value
through other comprehensive
income denominated in PLN (Bank
Millennium S.A.)
IRS
transactions
Hedging the fair value of cash
flows from issued fixed-rate
liabilities denominated in
foreign currencies (a)
The Group hedges part of the interest rate risk
related to changes in the fair value of cash flows
from issued fixed-rate liabilities denominated in
foreign currencies, resulting from the volatility of
market interest rates
Cash flows from issued fixed-rate
liabilities denominated in foreign
currencies (Bank Millennium S.A.)
IRS
transactions
Hedging the fair value of the
risk profile assigned to a
portfolio of homogeneous, non-
interest-bearing current
accounts in PLN (portfolio
hedge) (b)
The Group hedges part of the interest rate risk
related to the change in the fair value of the risk
profile assigned to the portfolios of homogeneous,
non-interest-bearing current accounts in PLN and
separately foreign currencies, resulting from the
volatility of market interest rates.
Risk profile assigned to a portfolios
of homogeneous, non-interest-
bearing current accounts in PLN
and separately in foreign currencies
(Bank Millennium S.A.).
IRS
transactions
(a) - Strategy applied in 2025 and 2024.
(b) - Strategy applied in 2025.
As at 31\u00a0December 2025, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2025
Hedging instruments
Book value
Change in
fair value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
36,938,459
30,536
34,026
(17,841)
Foreign exchange risk
Currency and interest rate swap
334,311
1,746
6,950
207
37,272,770
32,282
40,976
(17,634)
Cash flows hedging
Interest rate risk
Interest rate swaps
9,814,724
83
1,752
(1,636)
Total
47,087,494
32,365
42,728
(19,270)
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2024, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2024
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
23,798,173
47,629
8,759
60,064
Foreign exchange risk
Currency and interest rate swap
376,647
19,312
\u2014
(253)
24,174,820
66,941
8,759
59,811
Cash flows hedging
Interest rate risk
Interest rate swaps
11,501,067
2,408
6,724
468,167
Foreign exchange risk
Currency and interest rate swap
81,633
\u2014
23,558
998
11,582,700
2,408
30,282
469,165
Total
35,757,520
69,349
39,041
528,976
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2025, the table below includes the detail of the hedged items:
(Thousands of euros)
2025
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
1,139,290
\u2014
(20,453)
\u2014
(8,889)
n/a
n/a
(H)
13,373,963
\u2014
(86,703)
\u2014
(70,206)
n/a
n/a
(C)
6,006,753
\u2014
(57,540)
\u2014
(3,523)
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
10,955,660
\u2014
(13,139)
98,552
n/a
n/a
(F)
\u2014
3,028,763
\u2014
(13,456)
7,999
n/a
n/a
(G)
\u2014
1,042,739
\u2014
(10,783)
(3,359)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(C)
87,345
\u2014
75
\u2014
75
n/a
n/a
(E)
\u2014
246,966
\u2014
405
(406)
n/a
n/a
20,607,351
15,274,128
(164,621)
(36,973)
20,243
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
9,814,724
\u2014
\u2014
\u2014
1,636
(3,682)
(488,955)
Total
30,422,075
15,274,128
(164,621)
(36,973)
21,879
(3,682)
(488,955)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
As at 31\u00a0December 2024, the table below includes the detail of the hedged items:
(Thousands of euros)
2024
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
879,845
\u2014
(11,565)
\u2014
8,706
n/a
n/a
(H)
8,999,175
\u2014
(32,878)
\u2014
(372)
n/a
n/a
(C)
2,710,442
\u2014
(54,996)
\u2014
33,078
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
6,757,347
\u2014
127,030
(63,732)
n/a
n/a
(F)
\u2014
2,523,356
\u2014
(5,507)
(15,188)
n/a
n/a
(G)
\u2014
1,062,003
\u2014
(17,808)
(24,023)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(E)
\u2014
376,647
\u2014
(81)
137
n/a
n/a
12,589,462
10,719,353
(99,439)
103,634
(61,394)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
11,501,067
\u2014
\u2014
\u2014
(468,167)
(2,245)
(877,187)
Foreign exchange risk
Currency and interest rate
swap
(B)
81,633
\u2014
\u2014
\u2014
(1,050)
(165)
\u2014
11,582,700
\u2014
\u2014
\u2014
(469,217)
(2,410)
(877,187)
Total
24,172,162
10,719,353
(99,439)
103,634
(530,611)
(2,410)
(877,187)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
The reconciliation of each equity component and an analysis of other comprehensive income attributable to
hedge accounting, is as follows:
(Thousands of euros)
Cash flow hedge reserve
2025
2024
Balance as at 1 January
(879,597)
(1,280,910)
Amounts recognised in other comprehensive income:
\u00a0 Cash flow hedge
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,636)
469,217
\u00a0 \u00a0 Foreign exchange changes
(65)
(196)
\u00a0 \u00a0 Hedge breakage
388,232
(68,716)
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
(6)
52
\u00a0 \u00a0 Other
435
956
Balance at the end of the year
(492,637)
(879,597)
The table below includes information on the effectiveness of hedging relationships, as well as impacts on profit or
loss and other comprehensive income, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
2,733
(E)
\u2014
17,380
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(124)
\u2014
\u2014
\u2014
2,609
\u2014
17,380
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
4,798
6
(E)
(389,944)
\u2014
Total
4,798
2,615
(389,944)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest an similar income
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results
and other comprehensive income, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(1,467)
(E)
\u2014
6,761
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(116)
\u2014
\u2014
\u2014
(1,583)
\u2014
6,761
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
2,740
\u2014
(E)
(335,276)
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
1,225
(52)
\u2014
\u2014
3,965
(52)
(335,276)
\u2014
Total
3,965
(1,635)
(335,276)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest and similar income
The table below shows the detail of hedging instruments, as at 31\u00a0December 2025, by maturity:
(Thousands of euros)
2025
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fixed interest rate (average)
1.03%
5.51%
3.05%
3.09%
Fair value hedging derivatives related to
currency risk changes
OTC Market:
Currency and interest rate swap
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market:
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The table below shows the detail of hedging instruments, as at 31\u00a0December 2024, by maturity:
(Thousands of euros)
2024
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fixed interest rate (average)
-0.35%
3.15%
2.77%
2.72%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market:
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
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The balances Foreign exchange gains/(losses), Gains/(losses) on hedge accounting and Gains/(losses) arising from
derecognition of financial assets and liabilities not measured at fair value through profit or loss, are presented as
follows:
(Thousands of euros)
2025
2024
Foreign exchange gains/(losses)
Gains
4,001,409
2,544,176
Losses
(3,957,775)
(2,502,582)
43,634
41,594
Gains/(losses) on hedge accounting
Gains
Hedging derivatives
1,174,141
554,220
Hedged items
688,880
412,301
1,863,021
966,521
Losses
Hedging derivatives
(1,139,449)
(505,486)
Hedged items
(717,890)
(455,260)
(1,857,339)
(960,746)
5,682
5,775
Gains/(losses) arising from derecognition of financial assets and liabilities
not measured at fair value through profit or loss
Gains
Credit sales
9,723
38,293
Debt securities portfolio at amortised cost
684
\u2014
Debt securities portfolio at fair value through other comprehensive income
12,131
6,314
Debt securities issued
3,293
538
Other
1,928
2,255
27,759
47,400
Losses
Credit sales
(2,044)
(7,024)
Debt securities portfolio at amortised cost
(20,359)
(7,073)
Debt securities portfolio at fair value through other comprehensive income
(4,546)
(18,109)
Debt securities issued
(10,306)
\u2014
Other
(749)
(2,409)
(38,004)
(34,615)
(10,245)
12,785
The detail of the balance Gains/(losses) on hedge accounting relating to the hedging of financial assets and
liabilities is as follows:
(Thousands of euros)
2025
2024
Covered item
Loans and advances to customers (Portfolio Hedge)
(152)
1,773
Loans and advances to customers
(821)
44
Deposits from customers (CIRS)
58
3,716
Deposits from customers
(474)
137
Deposits from customers (Portfolio Hedge)
2,721
(11,189)
Bonds recorded in other comprehensive income and at amortised cost
3,016
2,536
Non subordinated debt
1,032
5,137
Subordinated debt
234
3,673
Others
68
(52)
5,682
5,775
Regarding the sale of financial assets at fair value through other comprehensive income subject to hedge
accounting, the balance Gains/(losses) arising from derecognition of financial assets and liabilities not measured at
fair value through profit or loss - Debt securities portfolio at fair value through other comprehensive income,
includes a net gain of EUR 5,459,000 (2024: net gain of EUR 2,190,000), which is offset in the balance Gains/(losses)
on hedge accounting.
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
Hedging derivatives
This balance is analysed, by hedging instruments, as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Assets
Liabilities
Swaps
32,365
42,728
69,349
39,041
Hedging derivatives are measured in accordance with internal valuation techniques considering observable
market inputs and, when not available, on information prepared by the Group by extrapolation of market data. In
accordance with the hierarchy of the valuation sources, as referred in IFRS 13, these derivatives are classified in
level 2. The Group resources to derivatives to hedge interest and exchange rate exposure risks. The accounting
method depends on the nature of the hedged risk, namely if the Group is exposed to changes in fair value,
variability in cash flows or highly probable forecast transactions.
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39, using mainly interest rate and exchange rate derivatives. The fair value hedge model is adopted for
debt securities, loans granted at fixed rate and money market loans and deposits, securities and combined hedge
of variable rate financial assets and fixed rate financial liabilities. The cash flows hedge model is adopted for future
transactions in foreign currency to cover dynamic changes in cash flows from loans granted and variable rate
deposits in foreign currency, and for mortgages in foreign currency.
The relationships that follow the fair value hedge model recorded ineffectiveness in the positive amount of EUR
2,609,000 (31\u00a0December 2024: negative amount of EUR 1,583,000), while hedging relationships that follow the cash
flow hedge model recorded positive ineffectiveness in the amount of EUR 6,000 (31\u00a0December 2024: negative
ineffectiveness of EUR 52 ,000).
Associated with hedge losses, the amount of EUR 321,661,000 (31\u00a0December 2024: EUR 262,845,000) of which EUR
389,944,000 (31\u00a0December 2024: EUR 335,276,000) was amortised from fair value reserves to interest and similar
income and interest and similar expense, relating to cash flow hedge accounting. The accumulated adjustment
on financial risks covered performed on the assets and liabilities which includes hedged items is detailed in note
55.
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining period)
Fair value
Up to
3 months
3 months to
1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining period)
Fair value
Up to
3 months
3 months to 1
year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
As at 31\u00a0December 2025, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2025
Hedging instruments
Book value
Change in
fair value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
36,938,459
30,536
34,026
(17,841)
Foreign exchange risk
Currency and interest rate swap
334,311
1,746
6,950
207
37,272,770
32,282
40,976
(17,634)
Cash flows hedging
Interest rate risk
Interest rate swaps
9,814,724
83
1,752
(1,636)
Total
47,087,494
32,365
42,728
(19,270)
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2024, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2024
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
23,798,173
47,629
8,759
60,064
Foreign exchange risk
Currency and interest rate swap
376,647
19,312
\u2014
(253)
24,174,820
66,941
8,759
59,811
Cash flows hedging
Interest rate risk
Interest rate swaps
11,501,067
2,408
6,724
468,167
Foreign exchange risk
Currency and interest rate swap
81,633
\u2014
23,558
998
11,582,700
2,408
30,282
469,165
Total
35,757,520
69,349
39,041
528,976
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2025, the table below includes the detail of the hedged items:
(Thousands of euros)
2025
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
1,139,290
\u2014
(20,453)
\u2014
(8,889)
n/a
n/a
(H)
13,373,963
\u2014
(86,703)
\u2014
(70,206)
n/a
n/a
(C)
6,006,753
\u2014
(57,540)
\u2014
(3,523)
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
10,955,660
\u2014
(13,139)
98,552
n/a
n/a
(F)
\u2014
3,028,763
\u2014
(13,456)
7,999
n/a
n/a
(G)
\u2014
1,042,739
\u2014
(10,783)
(3,359)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(C)
87,345
\u2014
75
\u2014
75
n/a
n/a
(E)
\u2014
246,966
\u2014
405
(406)
n/a
n/a
20,607,351
15,274,128
(164,621)
(36,973)
20,243
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
9,814,724
\u2014
\u2014
\u2014
1,636
(3,682)
(488,955)
Total
30,422,075
15,274,128
(164,621)
(36,973)
21,879
(3,682)
(488,955)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
As at 31\u00a0December 2024, the table below includes the detail of the hedged items:
(Thousands of euros)
2024
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
879,845
\u2014
(11,565)
\u2014
8,706
n/a
n/a
(H)
8,999,175
\u2014
(32,878)
\u2014
(372)
n/a
n/a
(C)
2,710,442
\u2014
(54,996)
\u2014
33,078
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
6,757,347
\u2014
127,030
(63,732)
n/a
n/a
(F)
\u2014
2,523,356
\u2014
(5,507)
(15,188)
n/a
n/a
(G)
\u2014
1,062,003
\u2014
(17,808)
(24,023)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(E)
\u2014
376,647
\u2014
(81)
137
n/a
n/a
12,589,462
10,719,353
(99,439)
103,634
(61,394)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
11,501,067
\u2014
\u2014
\u2014
(468,167)
(2,245)
(877,187)
Foreign exchange risk
Currency and interest rate
swap
(B)
81,633
\u2014
\u2014
\u2014
(1,050)
(165)
\u2014
11,582,700
\u2014
\u2014
\u2014
(469,217)
(2,410)
(877,187)
Total
24,172,162
10,719,353
(99,439)
103,634
(530,611)
(2,410)
(877,187)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
he reconciliation of each equity component and an analysis of other comprehensive income attributable to
hedge accounting, is as follows:
(Thousands of euros)
Cash flow hedge reserve
2025
2024
Balance as at 1 January
(879,597)
(1,280,910)
Amounts recognised in other comprehensive income:
\u00a0 Cash flow hedge
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,636)
469,217
\u00a0 \u00a0 Foreign exchange changes
(65)
(196)
\u00a0 \u00a0 Hedge breakage
388,232
(68,716)
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
(6)
52
\u00a0 \u00a0 Other
435
956
Balance at the end of the year
(492,637)
(879,597)
, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
2,733
(E)
\u2014
17,380
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(124)
\u2014
\u2014
\u2014
2,609
\u2014
17,380
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
4,798
6
(E)
(389,944)
\u2014
Total
4,798
2,615
(389,944)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest an similar income
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results
and other comprehensive income, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(1,467)
(E)
\u2014
6,761
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(116)
\u2014
\u2014
\u2014
(1,583)
\u2014
6,761
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
2,740
\u2014
(E)
(335,276)
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
1,225
(52)
\u2014
\u2014
3,965
(52)
(335,276)
\u2014
Total
3,965
(1,635)
(335,276)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest and similar income
The table below shows the detail of hedging instruments, as at 31\u00a0December 2025, by maturity:
(Thousands of euros)
2025
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fixed interest rate (average)
1.03%
5.51%
3.05%
3.09%
Fair value hedging derivatives related to
currency risk changes
OTC Market:
Currency and interest rate swap
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market:
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The table below shows the detail of hedging instruments, as at 31\u00a0December 2024, by maturity:
(Thousands of euros)
2024
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fixed interest rate (average)
-0.35%
3.15%
2.77%
2.72%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market:
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
", "dimensions": { "concept": "ifrs-full:DisclosureOfDerivativeFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-656": { "value": "Other operating income / (expenses)
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
The balance Contribution on the Banking Sector in Portugal includes the estimated contributions according to
the terms of the Decree-Law no. 55-A/2010. The determination of the amount payable is based on: (i) the annual
average liabilities deducted by core capital (Tier 1) and supplementary capital (Tier 2) and deposits covered by the
Deposit Guarantee Fund, and (ii) notional amount of derivatives.
Following Constitutional Court Ruling 478/2025, issued on 3 June 2025, which declared the Solidarity Surcharge on
the Banking Sector (ASSB) unconstitutional with general binding force, the Group did not proceed with the self-
assessment and payment of the tax which, under the previously applicable rules, would have been due by 30 June
2025. Further to the favourable court decisions handed down in the legal challenges concerning the ASSB paid by
the Group in 2020, 2021 and 2022, and the respective final and unappealable rulings, as well as the reimbursement
of the amounts paid in the 2023 and 2024 financial years, income in the amount of EUR 30,434 thousand was
recognised in the 2025 financial year. The amount relating to the banking sector contribution in Portugal totalled
EUR 28,560 thousand.
The balance Contributions to Resolution Funds includes the periodic contributions that must be paid to the
Portuguese Fund, as stipulated in Decree-Law 24/2013. The periodic contributions are determined by a base rate,
established by the Banco de Portugal through regulatory instruments, to be applied in each year and which may
be adjusted to the credit institution\u2019s risk profile based on the objective incidence of those contributions. The
period contributions affect the liabilities of the credit institutions members of the Fund, as per the article 10 of the
referred Decree-Law, deducted from the liability elements that are part of the core capital and supplementary and
from the deposits covered by the Deposit Guarantee Fund.
The balance Contributions to Resolution Funds also includes the mandatory contributions made by Bank
Millennium, S.A to the Bank Guarantee Fund in Poland. The current principles of financing the deposit guarantee
system and resolution in Poland, as defined in the Act of 10 June 2016 on the Bank Guarantee Fund, deposit
guarantee system and forced restructuring, and are effective from 2017.
The method of calculating contributions regarding the resolution fund of banks in Poland was defined in the
Regulation (EU) 63/2015 (amended by Regulation (EU) 1434/2016), which applies directly to all European Union
countries. The contribution for a given year from each entity is calculated by BFG in accordance with this
regulation and the entity is notified by 1 May, each year.
The balance contribution to the Deposit Guarantee Fund, attributable to the Group (BCP and ActivoBank),
amounted to EUR 639,000 (2024: EUR 629,000), with the Group delivering the entire annual contribution to the
Deposit Guarantee Fund.
Up to and including 2011, inclusive, under the terms set out in Banco de Portugal Notice No. 11/94, the Bank could
choose to deliver part of the contribution to the Deposit Guarantee Fund and the other part to constitute an
irrevocable payment commitment. As a guarantee of the assumption of irrevocable payment commitments
assumed until 2012 with the Deposit Guarantee Fund, in the amount of EUR 95,190,000, a security pledge was
created for this purpose.
In 2025 and 2024, the Group (BCP and ActivoBank) maid payments of EUR 47,595,000, in each year,\u00a0 of irrevocable
payment commitments assumed until 2012, with the irrevocable commitment and the respective pledge of
securities no longer existing, in 2025 (note 46).
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-655": { "value": "Other operating income / (expenses)
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
The balance Contribution on the Banking Sector in Portugal includes the estimated contributions according to
the terms of the Decree-Law no. 55-A/2010. The determination of the amount payable is based on: (i) the annual
average liabilities deducted by core capital (Tier 1) and supplementary capital (Tier 2) and deposits covered by the
Deposit Guarantee Fund, and (ii) notional amount of derivatives.
Following Constitutional Court Ruling 478/2025, issued on 3 June 2025, which declared the Solidarity Surcharge on
the Banking Sector (ASSB) unconstitutional with general binding force, the Group did not proceed with the self-
assessment and payment of the tax which, under the previously applicable rules, would have been due by 30 June
2025. Further to the favourable court decisions handed down in the legal challenges concerning the ASSB paid by
the Group in 2020, 2021 and 2022, and the respective final and unappealable rulings, as well as the reimbursement
of the amounts paid in the 2023 and 2024 financial years, income in the amount of EUR 30,434 thousand was
recognised in the 2025 financial year. The amount relating to the banking sector contribution in Portugal totalled
EUR 28,560 thousand.
The balance Contributions to Resolution Funds includes the periodic contributions that must be paid to the
Portuguese Fund, as stipulated in Decree-Law 24/2013. The periodic contributions are determined by a base rate,
established by the Banco de Portugal through regulatory instruments, to be applied in each year and which may
be adjusted to the credit institution\u2019s risk profile based on the objective incidence of those contributions. The
period contributions affect the liabilities of the credit institutions members of the Fund, as per the article 10 of the
referred Decree-Law, deducted from the liability elements that are part of the core capital and supplementary and
from the deposits covered by the Deposit Guarantee Fund.
The balance Contributions to Resolution Funds also includes the mandatory contributions made by Bank
Millennium, S.A to the Bank Guarantee Fund in Poland. The current principles of financing the deposit guarantee
system and resolution in Poland, as defined in the Act of 10 June 2016 on the Bank Guarantee Fund, deposit
guarantee system and forced restructuring, and are effective from 2017.
The method of calculating contributions regarding the resolution fund of banks in Poland was defined in the
Regulation (EU) 63/2015 (amended by Regulation (EU) 1434/2016), which applies directly to all European Union
countries. The contribution for a given year from each entity is calculated by BFG in accordance with this
regulation and the entity is notified by 1 May, each year.
The balance contribution to the Deposit Guarantee Fund, attributable to the Group (BCP and ActivoBank),
amounted to EUR 639,000 (2024: EUR 629,000), with the Group delivering the entire annual contribution to the
Deposit Guarantee Fund.
Up to and including 2011, inclusive, under the terms set out in Banco de Portugal Notice No. 11/94, the Bank could
choose to deliver part of the contribution to the Deposit Guarantee Fund and the other part to constitute an
irrevocable payment commitment. As a guarantee of the assumption of irrevocable payment commitments
assumed until 2012 with the Deposit Guarantee Fund, in the amount of EUR 95,190,000, a security pledge was
created for this purpose.
In 2025 and 2024, the Group (BCP and ActivoBank) maid payments of EUR 47,595,000, in each year,\u00a0 of irrevocable
payment commitments assumed until 2012, with the irrevocable commitment and the respective pledge of
securities no longer existing, in 2025 (note 46).
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-657": { "value": "
The amount of this account is comprised of
(Thousands of euros)
2025
2024
Operating income
Gains on leasing operations
2,921
8,022
Income from services rendered
34,754
32,286
Rents
1,813
1,970
Sales of cheques and others
6,851
7,239
Other operating income
76,939
73,676
123,278
123,193
Operating expenses
Donations and contributions
(4,999)
(4,605)
Contribution on the Banking Sector
1,875
(32,867)
Contributions to Resolution Funds
(28,114)
(20,625)
Contributions to the Deposit Guarantee Fund
(18,979)
(810)
Special tax on the polish banking sector
(95,776)
(53,991)
Taxes
(15,806)
(15,617)
Losses on financial leasing operations
(230)
(50)
Other operating expenses
(96,999)
(146,901)
(259,028)
(275,466)
(135,750)
(152,273)
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingIncomeExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-659": { "value": "Staff costs
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Remunerations
623,054
577,064
Mandatory social security charges
Post-employment benefits (note 51)
Service cost
(9,717)
(9,738)
Net interest cost / (income) in the liability coverage balance
(43)
(6,301)
Cost with early retirement programs
20,656
10,478
10,896
(5,561)
Other mandatory social security charges
134,634
125,818
145,530
120,257
Voluntary social security charges
12,094
14,635
Other staff costs
11,756
10,020
792,434
721,976
In 2025, the Group paid severance payments in the amount of EUR 3,823,000 (2024: EUR 4,431,000 ), of which the
highest amounted to EUR 230,000 (2024: EUR 381,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by
category:
2025
2024
Portugal
Top Management
884
881
Intermediary Management
1,435
1,449
Specific/Technical functions
2,897
2,926
Other functions
990
1,010
6,206
6,266
Abroad
9,459
9,310
15,665
15,576
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories
of employees provided for in Article 115-C (2) of the RGICS, as well as the information provided for in Article 450 (g)
to (i) of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial
Portugu\u00eas, S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2025
2024
2025
2024
Fixed remuneration
3,426
3,342
2,211
2,056
Variable remuneration
Pecuniary
576
692
\u2014
\u2014
Shares
729
856
\u2014
\u2014
Deferred
1,831
1,037
\u2014
\u2014
Supplementary retirement pension
764
669
227
222
Post-employment benefits
(35)
(16)
\u2014
\u2014
Other mandatory social security charges
822
802
441
455
8,113
7,382
2,879
2,733
Number of beneficiaries
6
6
12
10
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity
contract, intends to compensate the functions that are performed in the Group and in all other functions
performed in subsidiaries or governing bodies for which they have been designated by indication or in
representation of the Group, in the latter case, the net amount of the remuneration annually received by each
member of the Executive Committee will be deducted from the fixed annual remuneration attributed by the
Group, ensuring that the effective payable amount corresponds to the one approved by the Remuneration and
Welfare Board.
The amount of remuneration paid to the Executive Committee includes the amount of EUR 191,000 (2024: EUR
128,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was EUR 39,000 (2024: EUR 34,000).
In 2025 and 2024, variable remuneration was awarded as a result of the Remuneration Policies for the members of
the management and supervisory bodies and for employees, approved for 2024 and 2023, as described in
accounting policies 1 R4 and 1 R5.
In 2025, the variable remuneration attributed was EUR 1,440,000 in cash, (2024: EUR 1,384,000) of which EUR
864,000 are deferred for 5 years (2024: EUR 692,000), and 2,673,969 BCP shares (2024: 4,684,579 BCP shares)
corresponding to EUR 1,440,000 (2024: EUR 1,384,000), of which 1,604,381 BCP shares are deferred for 5 years (2024:
2,342,290 BCP shares).
In 2025, the deferred variable remuneration paid refers to the years 2018 to 2023 (2024: 2018 to 2022), of which EUR
251,000 in cash (2024: EUR 224,000) and 2,318,880 BCP shares (2024: 2,225,180 BCP shares) in the amount of EUR
1,580,000 (2024: EUR 813,000).
In 2025 and 2024, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
The remunerations and social security charges supported with the Group's Key Function Holders are, detailed by
segment, as follows:
(Thousands of euros)
Retail
Corporate
Control
functions
Other
Total
2025
2024
2025
2024
2025
2024
2025
2024
2025
2024
Fixed remuneration
1,199
1,253
2,120
2,456
2,942
2,982
5,978
5,350
12,239
12,041
Variable remuneration
Pecuniary
161
173
180
195
541
528
875
916
1,757
1,812
Shares
120
134
76
153
41
70
463
506
700
863
Deferred
117
62
89
72
53
37
512
252
771
423
Post-employment benefits
(65)
(82)
(43)
(55)
(128)
(140)
(183)
(221)
(419)
(498)
Other mandatory social
security charges
328
313
442
534
741
756
1,484
1,345
2,995
2,948
1,860
1,853
2,864
3,355
4,190
4,233
9,129
8,148
18,043
17,589
Number of beneficiaries
10
8
11
13
31
33
42
39
94
93
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2024 and
2023, as described in accounting policies 1 R4 and 1 R5, in 2025, the 94 Key Function Holders (KFH) (2024: 93 KFH)
were awarded with variable remuneration, in the amount of EUR 1,325,000 in cash (2024: EUR 487,000) and
2,455,037 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations were paid to KFH deferred from 2019 to 2023 (2024: 2019 to 2022)
corresponding in cash to EUR 227,000 (2024: EUR 164,000) and BCP shares in the amount of EUR 545,000 (2024:
EUR 258,000).
In 2025, severance payments were paid to 4 KFH (2024: 5 KFH) in the amount of EUR 565,000 (2024: EUR 915,000).
The highest payment was EUR 230,000 (2024: EUR 381,000).
In 2025, the end-of-career bonuses were paid in the amount of EUR 254,000 (2024: EUR 83,000).
The remunerations and social security charges supported with the Group's Key Function Holders, discriminated by
Key management personnel and by members whose professional activities have significant impact in the risk
profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management
personnel
Other KFH
Total
2025
2024
2025
2024
2025
2024
Fixed remuneration
9,023
7,887
3,216
4,155
12,239
12,042
Variable remuneration
Pecuniary
1,134
1,128
623
682
1,757
1,810
Shares
700
863
\u2014
\u2014
700
863
Deferred
765
415
6
7
771
422
Post-employment benefits
(248)
(296)
(171)
(200)
(419)
(496)
Other mandatory social security charges
2,179
1,979
816
968
2,995
2,947
13,553
11,976
4,490
5,612
18,043
17,588
Number of beneficiaries
58
53
36
40
94
93
In 2025, the Key management personnel were awarded with deferred variable remuneration in the amount of
EUR 461,000 (2024: EUR 487,000) and 850,656 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations from years 2019 to 2023 (2024: 2019 to 2022) were paid in cash to Key
management members, in the amount of EUR 225,000 (2024: EUR 161,000), as well as BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund corresponding to EUR 541,000 (2024: EUR 254,000).
Regarding the other KFH, were paid EUR 2,000 (2024: EUR 3,000) in cash deferred from 2019, BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund, from the years 2019, corresponding to EUR 5,000 (2024: EUR
4,000).
In accordance with regulation (EU) 11 575/2013, Article 450 (1)(i), in 2025 the Bank has 1 employee on the Board of
Directors with remuneration between EUR 1.5 million and EUR 2 million. In 2025 has 5 employees on the Board of
Directors with remuneration between EUR 1 million and EUR 1.5 million (2024: 3 employees).", "dimensions": { "concept": "ifrs-full:DisclosureOfInformationAboutEmployeesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-658": { "value": "Staff costs
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Remunerations
623,054
577,064
Mandatory social security charges
Post-employment benefits (note 51)
Service cost
(9,717)
(9,738)
Net interest cost / (income) in the liability coverage balance
(43)
(6,301)
Cost with early retirement programs
20,656
10,478
10,896
(5,561)
Other mandatory social security charges
134,634
125,818
145,530
120,257
Voluntary social security charges
12,094
14,635
Other staff costs
11,756
10,020
792,434
721,976
In 2025, the Group paid severance payments in the amount of EUR 3,823,000 (2024: EUR 4,431,000 ), of which the
highest amounted to EUR 230,000 (2024: EUR 381,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by
category:
2025
2024
Portugal
Top Management
884
881
Intermediary Management
1,435
1,449
Specific/Technical functions
2,897
2,926
Other functions
990
1,010
6,206
6,266
Abroad
9,459
9,310
15,665
15,576
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories
of employees provided for in Article 115-C (2) of the RGICS, as well as the information provided for in Article 450 (g)
to (i) of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial
Portugu\u00eas, S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2025
2024
2025
2024
Fixed remuneration
3,426
3,342
2,211
2,056
Variable remuneration
Pecuniary
576
692
\u2014
\u2014
Shares
729
856
\u2014
\u2014
Deferred
1,831
1,037
\u2014
\u2014
Supplementary retirement pension
764
669
227
222
Post-employment benefits
(35)
(16)
\u2014
\u2014
Other mandatory social security charges
822
802
441
455
8,113
7,382
2,879
2,733
Number of beneficiaries
6
6
12
10
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity
contract, intends to compensate the functions that are performed in the Group and in all other functions
performed in subsidiaries or governing bodies for which they have been designated by indication or in
representation of the Group, in the latter case, the net amount of the remuneration annually received by each
member of the Executive Committee will be deducted from the fixed annual remuneration attributed by the
Group, ensuring that the effective payable amount corresponds to the one approved by the Remuneration and
Welfare Board.
The amount of remuneration paid to the Executive Committee includes the amount of EUR 191,000 (2024: EUR
128,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was EUR 39,000 (2024: EUR 34,000).
In 2025 and 2024, variable remuneration was awarded as a result of the Remuneration Policies for the members of
the management and supervisory bodies and for employees, approved for 2024 and 2023, as described in
accounting policies 1 R4 and 1 R5.
In 2025, the variable remuneration attributed was EUR 1,440,000 in cash, (2024: EUR 1,384,000) of which EUR
864,000 are deferred for 5 years (2024: EUR 692,000), and 2,673,969 BCP shares (2024: 4,684,579 BCP shares)
corresponding to EUR 1,440,000 (2024: EUR 1,384,000), of which 1,604,381 BCP shares are deferred for 5 years (2024:
2,342,290 BCP shares).
In 2025, the deferred variable remuneration paid refers to the years 2018 to 2023 (2024: 2018 to 2022), of which EUR
251,000 in cash (2024: EUR 224,000) and 2,318,880 BCP shares (2024: 2,225,180 BCP shares) in the amount of EUR
1,580,000 (2024: EUR 813,000).
In 2025 and 2024, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
The remunerations and social security charges supported with the Group's Key Function Holders are, detailed by
segment, as follows:
(Thousands of euros)
Retail
Corporate
Control
functions
Other
Total
2025
2024
2025
2024
2025
2024
2025
2024
2025
2024
Fixed remuneration
1,199
1,253
2,120
2,456
2,942
2,982
5,978
5,350
12,239
12,041
Variable remuneration
Pecuniary
161
173
180
195
541
528
875
916
1,757
1,812
Shares
120
134
76
153
41
70
463
506
700
863
Deferred
117
62
89
72
53
37
512
252
771
423
Post-employment benefits
(65)
(82)
(43)
(55)
(128)
(140)
(183)
(221)
(419)
(498)
Other mandatory social
security charges
328
313
442
534
741
756
1,484
1,345
2,995
2,948
1,860
1,853
2,864
3,355
4,190
4,233
9,129
8,148
18,043
17,589
Number of beneficiaries
10
8
11
13
31
33
42
39
94
93
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2024 and
2023, as described in accounting policies 1 R4 and 1 R5, in 2025, the 94 Key Function Holders (KFH) (2024: 93 KFH)
were awarded with variable remuneration, in the amount of EUR 1,325,000 in cash (2024: EUR 487,000) and
2,455,037 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations were paid to KFH deferred from 2019 to 2023 (2024: 2019 to 2022)
corresponding in cash to EUR 227,000 (2024: EUR 164,000) and BCP shares in the amount of EUR 545,000 (2024:
EUR 258,000).
In 2025, severance payments were paid to 4 KFH (2024: 5 KFH) in the amount of EUR 565,000 (2024: EUR 915,000).
The highest payment was EUR 230,000 (2024: EUR 381,000).
In 2025, the end-of-career bonuses were paid in the amount of EUR 254,000 (2024: EUR 83,000).
The remunerations and social security charges supported with the Group's Key Function Holders, discriminated by
Key management personnel and by members whose professional activities have significant impact in the risk
profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management
personnel
Other KFH
Total
2025
2024
2025
2024
2025
2024
Fixed remuneration
9,023
7,887
3,216
4,155
12,239
12,042
Variable remuneration
Pecuniary
1,134
1,128
623
682
1,757
1,810
Shares
700
863
\u2014
\u2014
700
863
Deferred
765
415
6
7
771
422
Post-employment benefits
(248)
(296)
(171)
(200)
(419)
(496)
Other mandatory social security charges
2,179
1,979
816
968
2,995
2,947
13,553
11,976
4,490
5,612
18,043
17,588
Number of beneficiaries
58
53
36
40
94
93
In 2025, the Key management personnel were awarded with deferred variable remuneration in the amount of
EUR 461,000 (2024: EUR 487,000) and 850,656 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations from years 2019 to 2023 (2024: 2019 to 2022) were paid in cash to Key
management members, in the amount of EUR 225,000 (2024: EUR 161,000), as well as BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund corresponding to EUR 541,000 (2024: EUR 254,000).
Regarding the other KFH, were paid EUR 2,000 (2024: EUR 3,000) in cash deferred from 2019, BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund, from the years 2019, corresponding to EUR 5,000 (2024: EUR
4,000).
In accordance with regulation (EU) 11 575/2013, Article 450 (1)(i), in 2025 the Bank has 1 employee on the Board of
Directors with remuneration between EUR 1.5 million and EUR 2 million. In 2025 has 5 employees on the Board of
Directors with remuneration between EUR 1 million and EUR 1.5 million (2024: 3 employees).
Other administrative costs
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Water, electricity and fuel
14,377
13,960
Credit cards and mortgage
12,735
12,698
Communications
27,678
27,483
Maintenance and related services
20,581
20,323
Legal expenses
3,724
5,286
Travel, hotel and representation costs
10,756
10,398
Advisory services
46,530
53,727
Training costs
1,932
2,175
Information technology services
29,579
27,724
Consumables
7,516
8,259
Outsourcing and independent labour
138,331
116,311
Advertising
36,496
31,127
Rents and leases
28,170
30,137
Insurance
6,254
5,352
Transportation
11,447
11,901
Other specialised services
40,802
36,164
Other supplies and services
30,012
27,442
466,920
440,467
The balance Rents and leases includes the amount of EUR 125,000 (2024: EUR 262,000) related to short-term lease
contracts and the amount of EUR 2,498,000 (2024: EUR 2,473,000) related to lease contracts of low-value assets, as
described in the accounting policy 1 H.
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other
services, is analysed as follows:
(Thousands of euros)
2025
2024
Auditing services
Statutory audit services
3,133
1,792
Other assurance services
1,877
1,140
Other services
732
899
5,742
3,831
For 2025 financial year, the fees relating to the statutory audit services provided to the companies in Poland are
also reported. KPMG was appointed as the Statutory Auditor of Bank Millennium and its subsidiaries on 24
February 2025, with the exception of Millennium Bank Hipoteczny (Mortgage Bank).
Amortisations and depreciations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Amortisations of intangible assets (note 30):
Software
43,019
35,632
Other intangible assets
7,529
7,043
50,548
42,675
Depreciations of other tangible assets (note 29):
Properties
14,537
14,769
Equipment
Computers
20,829
18,347
Security equipment
1,345
1,076
Indoor facilities
3,458
3,305
Machinery
1,515
1,682
Furniture
2,172
2,423
Vehicles
6,316
5,702
Other equipment
2,055
1,994
Right-of-use
Real estate
52,959
52,827
105,186
102,125
155,734
144,800
Results on modification
The Group has accounted for in this balance a cost of EUR 5,320,000 (2024: cost of EUR 42,334,000) relating to
contractual modifications made in accordance with IFRS 9, namely those negotiated with customers holding
foreign currency-indexed mortgages loans in Poland, described in note 58, in the amount of EUR 2,499.000 (2024:
EUR 34,055,000).
In 2024, this balance also included a cost with credit holidays in the amount of EUR 26,182,000, following the
signing by the President of the Republic of Poland and announcement in the Journal of Laws of the Republic of
Poland of an Act of 12 April 2024 amending the existing Law on support for mortgage borrowers in challenging
financial situation and the Act on crowdfunding for business ventures and assistance to borrowers (\u2018the Act\u2019),
introducing, among other measures, an extension of credit holidays for PLN mortgage borrowers for further four
months in 2024.
Impairment of financial assets at amortised cost
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Loans and advances to credit institutions (note 21)
Charge for the year
471
216
Reversals for the year
(63)
(327)
408
(111)
Loans and advances to customers (note 22)
Charge for the year
745,135
804,883
Reversals for the year
(523,071)
(550,457)
Recoveries of loans and interest charged-off
(18,080)
(70,624)
203,984
183,802
Debt securities (note 23)
Associated to credit operations
Charge for the year
1,287
1,691
Reversals for the year
(5,788)
(3,099)
(4,501)
(1,408)
Not associated to credit operations
Charge for the year
71,342
35,485
Reversals for the year
(6,143)
(2,571)
65,199
32,914
60,698
31,506
265,090
215,197
The balances Impairment Loans and advances to customers and Debt securities not associated to credit
operations, include a net reversal of charge recorded in BIM - Banco Internacional de Mo\u00e7ambique, S.A., in the
amount of EUR 29,296,000 (2024: EUR 4,637,000) and EUR 63,266,000 (2024: EUR 27,157,000), respectively,
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
Impairment of financial assets at fair value through other comprehensive
income
The detail of this balance is comprised of:
(Thousands of euros)
2025
2024
Impairment of financial assets at fair value through other comprehensive income (note
24)
Charge for the year
10,940
10,255
Reversals for the year
(4,839)
(42)
6,101
10,213
Impairment of other assets
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Impairment of non-current assets held for sale (note 27)
Charge for the year
1,187
5,722
Reversals for the year
(2,158)
(1,398)
(971)
4,324
Impairment of tangible fixed assets (note 29)
Charge for the year
\u2014
184
(50)
184
Impairment of other assets (note 32)
Charge for the year
13,943
18,407
Reversals for the year
(3,452)
(5,339)
10,491
13,068
Impairment of real estate and other assets arising from recovered loans (note 32)
Charge for the year
11,880
33,875
Reversals for the year
(215)
(407)
11,665
33,468
21,135
51,044
Other provisions
This balance is comprised of:
(Thousands of euros)
2025
2024
Provision for guarantees and other commitments (note 39)
Charge for the year
79,248
34,826
Reversals for the year
(51,165)
(37,481)
28,083
(2,655)
Other provisions for liabilities and charges (note 39)
Charge for the year
523,282
588,351
Reversals for the year
(18,348)
(4,672)
504,934
583,679
533,017
581,024
The balance Other provisions for liabilities and charges - Charge for the year refers essentially to provisions for
legal risk accounted for by Bank Millennium, related to foreign currency-indexed mortgage loans, as described in
note 58, which, in 2025, amounted to EUR 480,973,000 (2024: EUR 506,195,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfExpensesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-660": { "value": "
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial
Portugu\u00eas, S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2025
2024
2025
2024
Fixed remuneration
3,426
3,342
2,211
2,056
Variable remuneration
Pecuniary
576
692
\u2014
\u2014
Shares
729
856
\u2014
\u2014
Deferred
1,831
1,037
\u2014
\u2014
Supplementary retirement pension
764
669
227
222
Post-employment benefits
(35)
(16)
\u2014
\u2014
Other mandatory social security charges
822
802
441
455
8,113
7,382
2,879
2,733
Number of beneficiaries
6
6
12
10
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity
contract, intends to compensate the functions that are performed in the Group and in all other functions
performed in subsidiaries or governing bodies for which they have been designated by indication or in
representation of the Group, in the latter case, the net amount of the remuneration annually received by each
member of the Executive Committee will be deducted from the fixed annual remuneration attributed by the
Group, ensuring that the effective payable amount corresponds to the one approved by the Remuneration and
Welfare Board.
The amount of remuneration paid to the Executive Committee includes the amount of EUR 191,000 (2024: EUR
128,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was EUR 39,000 (2024: EUR 34,000).
In 2025 and 2024, variable remuneration was awarded as a result of the Remuneration Policies for the members of
the management and supervisory bodies and for employees, approved for 2024 and 2023, as described in
accounting policies 1 R4 and 1 R5.
In 2025, the variable remuneration attributed was EUR 1,440,000 in cash, (2024: EUR 1,384,000) of which EUR
864,000 are deferred for 5 years (2024: EUR 692,000), and 2,673,969 BCP shares (2024: 4,684,579 BCP shares)
corresponding to EUR 1,440,000 (2024: EUR 1,384,000), of which 1,604,381 BCP shares are deferred for 5 years (2024:
2,342,290 BCP shares).
In 2025, the deferred variable remuneration paid refers to the years 2018 to 2023 (2024: 2018 to 2022), of which EUR
251,000 in cash (2024: EUR 224,000) and 2,318,880 BCP shares (2024: 2,225,180 BCP shares) in the amount of EUR
1,580,000 (2024: EUR 813,000).
In 2025 and 2024, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
The remunerations and social security charges supported with the Group's Key Function Holders are, detailed by
segment, as follows:
(Thousands of euros)
Retail
Corporate
Control
functions
Other
Total
2025
2024
2025
2024
2025
2024
2025
2024
2025
2024
Fixed remuneration
1,199
1,253
2,120
2,456
2,942
2,982
5,978
5,350
12,239
12,041
Variable remuneration
Pecuniary
161
173
180
195
541
528
875
916
1,757
1,812
Shares
120
134
76
153
41
70
463
506
700
863
Deferred
117
62
89
72
53
37
512
252
771
423
Post-employment benefits
(65)
(82)
(43)
(55)
(128)
(140)
(183)
(221)
(419)
(498)
Other mandatory social
security charges
328
313
442
534
741
756
1,484
1,345
2,995
2,948
1,860
1,853
2,864
3,355
4,190
4,233
9,129
8,148
18,043
17,589
Number of beneficiaries
10
8
11
13
31
33
42
39
94
93
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2024 and
2023, as described in accounting policies 1 R4 and 1 R5, in 2025, the 94 Key Function Holders (KFH) (2024: 93 KFH)
were awarded with variable remuneration, in the amount of EUR 1,325,000 in cash (2024: EUR 487,000) and
2,455,037 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations were paid to KFH deferred from 2019 to 2023 (2024: 2019 to 2022)
corresponding in cash to EUR 227,000 (2024: EUR 164,000) and BCP shares in the amount of EUR 545,000 (2024:
EUR 258,000).
In 2025, severance payments were paid to 4 KFH (2024: 5 KFH) in the amount of EUR 565,000 (2024: EUR 915,000).
The highest payment was EUR 230,000 (2024: EUR 381,000).
In 2025, the end-of-career bonuses were paid in the amount of EUR 254,000 (2024: EUR 83,000).
The remunerations and social security charges supported with the Group's Key Function Holders, discriminated by
Key management personnel and by members whose professional activities have significant impact in the risk
profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management
personnel
Other KFH
Total
2025
2024
2025
2024
2025
2024
Fixed remuneration
9,023
7,887
3,216
4,155
12,239
12,042
Variable remuneration
Pecuniary
1,134
1,128
623
682
1,757
1,810
Shares
700
863
\u2014
\u2014
700
863
Deferred
765
415
6
7
771
422
Post-employment benefits
(248)
(296)
(171)
(200)
(419)
(496)
Other mandatory social security charges
2,179
1,979
816
968
2,995
2,947
13,553
11,976
4,490
5,612
18,043
17,588
Number of beneficiaries
58
53
36
40
94
93
In 2025, the Key management personnel were awarded with deferred variable remuneration in the amount of
EUR 461,000 (2024: EUR 487,000) and 850,656 BCP shares deferred for 5 years (2024: 1,798,447 BCP shares).
In 2025, deferred variable remunerations from years 2019 to 2023 (2024: 2019 to 2022) were paid in cash to Key
management members, in the amount of EUR 225,000 (2024: EUR 161,000), as well as BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund corresponding to EUR 541,000 (2024: EUR 254,000).
Regarding the other KFH, were paid EUR 2,000 (2024: EUR 3,000) in cash deferred from 2019, BCP shares and
participation units from AF Portf\u00f3lio Imobili\u00e1rio Fund, from the years 2019, corresponding to EUR 5,000 (2024: EUR
4,000).
In accordance with regulation (EU) 11 575/2013, Article 450 (1)(i), in 2025 the Bank has 1 employee on the Board of
Directors with remuneration between EUR 1.5 million and EUR 2 million. In 2025 has 5 employees on the Board of
Directors with remuneration between EUR 1 million and EUR 1.5 million (2024: 3 employees).
The balances with related parties discriminated in the following table, included on the consolidated balance sheet,
are analysed as follows:
(Thousands of euros)
Loans and advances to
customers
Deposits from customers
and other funds
2025
2024
2025
2024
Board of Directors
Non-executive directors
3
37
9,075
9,335
Executive Committee (*)
17
9
4,245
2,425
Closely related people
485
494
2,837
2,768
Controlled entities
1
4
1,426
337
Key management personnel
Key management personnel
5,104
4,581
7,519
11,961
Closely related people
3,660
2,356
3,611
4,441
Controlled entities
812
2,881
585
5,456
10,082
10,362
29,298
36,723
(*) The item Loans to Customers corresponds to the amount used from private credit cards which must be settled on the maturity date.
The transactions with related parties discriminated in the following table, included in income items of the
consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar income
Commissions income
2025
2024
2025
2024
Board of Directors
Non-executive directors
1
1
20
27
Executive Committee
\u2014
\u2014
11
10
Closely related people
\u2014
1
4
4
Controlled entities
\u2014
\u2014
1
1
Key management personnel
Key management personnel
149
224
17
25
Closely related people
77
78
6
20
Controlled entities
17
76
3
27
244
380
62
114
The transactions with related parties discriminated in the following table, included in cost items of the
consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar expense
Commissions' expense
2025
2024
2025
2024
Board of Directors
Non-executive directors
204
268
\u2014
\u2014
Executive Committee (*)
47
60
\u2014
\u2014
Closely related people
45
73
\u2014
\u2014
Controlled entities
4
1
\u2014
\u2014
Key management personnel
Key management personnel
87
262
\u2014
1
Closely related people
28
62
\u2014
\u2014
Controlled entities
7
62
\u2014
\u2014
422
788
\u2014
1
The revocable credit facilities granted by the Group to the following related parties are as follows:
(Thousands of euros)
Guarantees granted
Revocable credit facilities
2025
2024
2025
2024
Board of Directors
Non-executive directors
\u2014
\u2014
129
119
Executive Committee (*)
\u2014
\u2014
102
110
Closely related people
\u2014
\u2014
87
87
Controlled entities
8
9
5
25
Key management personnel
Key management personnel
4
5
749
745
Closely related people
\u2014
\u2014
191
198
Controlled entities
\u2014
\u2014
17
41
12
14
1,280
1,325
(*) Corresponds to the maximum authorised and unused limit of private credit cards and overdraft authorisation in a salary account under the same
regime as all the Group's other employees.
C)", "dimensions": { "concept": "ifrs-full:DisclosureOfInformationAboutKeyManagementPersonnelExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-661": { "value": "Other administrative costs
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Water, electricity and fuel
14,377
13,960
Credit cards and mortgage
12,735
12,698
Communications
27,678
27,483
Maintenance and related services
20,581
20,323
Legal expenses
3,724
5,286
Travel, hotel and representation costs
10,756
10,398
Advisory services
46,530
53,727
Training costs
1,932
2,175
Information technology services
29,579
27,724
Consumables
7,516
8,259
Outsourcing and independent labour
138,331
116,311
Advertising
36,496
31,127
Rents and leases
28,170
30,137
Insurance
6,254
5,352
Transportation
11,447
11,901
Other specialised services
40,802
36,164
Other supplies and services
30,012
27,442
466,920
440,467
The balance Rents and leases includes the amount of EUR 125,000 (2024: EUR 262,000) related to short-term lease
contracts and the amount of EUR 2,498,000 (2024: EUR 2,473,000) related to lease contracts of low-value assets, as
described in the accounting policy 1 H.
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other
services, is analysed as follows:
(Thousands of euros)
2025
2024
Auditing services
Statutory audit services
3,133
1,792
Other assurance services
1,877
1,140
Other services
732
899
5,742
3,831
For 2025 financial year, the fees relating to the statutory audit services provided to the companies in Poland are
also reported. KPMG was appointed as the Statutory Auditor of Bank Millennium and its subsidiaries on 24
February 2025, with the exception of Millennium Bank Hipoteczny (Mortgage Bank).
", "dimensions": { "concept": "ifrs-full:DisclosureOfGeneralAndAdministrativeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-662": { "value": "
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Water, electricity and fuel
14,377
13,960
Credit cards and mortgage
12,735
12,698
Communications
27,678
27,483
Maintenance and related services
20,581
20,323
Legal expenses
3,724
5,286
Travel, hotel and representation costs
10,756
10,398
Advisory services
46,530
53,727
Training costs
1,932
2,175
Information technology services
29,579
27,724
Consumables
7,516
8,259
Outsourcing and independent labour
138,331
116,311
Advertising
36,496
31,127
Rents and leases
28,170
30,137
Insurance
6,254
5,352
Transportation
11,447
11,901
Other specialised services
40,802
36,164
Other supplies and services
30,012
27,442
466,920
440,467
Amortisations and depreciations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Amortisations of intangible assets (note 30):
Software
43,019
35,632
Other intangible assets
7,529
7,043
50,548
42,675
Depreciations of other tangible assets (note 29):
Properties
14,537
14,769
Equipment
Computers
20,829
18,347
Security equipment
1,345
1,076
Indoor facilities
3,458
3,305
Machinery
1,515
1,682
Furniture
2,172
2,423
Vehicles
6,316
5,702
Other equipment
2,055
1,994
Right-of-use
Real estate
52,959
52,827
105,186
102,125
155,734
144,800
Results on modification
The Group has accounted for in this balance a cost of EUR 5,320,000 (2024: cost of EUR 42,334,000) relating to
contractual modifications made in accordance with IFRS 9, namely those negotiated with customers holding
foreign currency-indexed mortgages loans in Poland, described in note 58, in the amount of EUR 2,499.000 (2024:
EUR 34,055,000).
In 2024, this balance also included a cost with credit holidays in the amount of EUR 26,182,000, following the
signing by the President of the Republic of Poland and announcement in the Journal of Laws of the Republic of
Poland of an Act of 12 April 2024 amending the existing Law on support for mortgage borrowers in challenging
financial situation and the Act on crowdfunding for business ventures and assistance to borrowers (\u2018the Act\u2019),
introducing, among other measures, an extension of credit holidays for PLN mortgage borrowers for further four
months in 2024.
Impairment of financial assets at amortised cost
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Loans and advances to credit institutions (note 21)
Charge for the year
471
216
Reversals for the year
(63)
(327)
408
(111)
Loans and advances to customers (note 22)
Charge for the year
745,135
804,883
Reversals for the year
(523,071)
(550,457)
Recoveries of loans and interest charged-off
(18,080)
(70,624)
203,984
183,802
Debt securities (note 23)
Associated to credit operations
Charge for the year
1,287
1,691
Reversals for the year
(5,788)
(3,099)
(4,501)
(1,408)
Not associated to credit operations
Charge for the year
71,342
35,485
Reversals for the year
(6,143)
(2,571)
65,199
32,914
60,698
31,506
265,090
215,197
The balances Impairment Loans and advances to customers and Debt securities not associated to credit
operations, include a net reversal of charge recorded in BIM - Banco Internacional de Mo\u00e7ambique, S.A., in the
amount of EUR 29,296,000 (2024: EUR 4,637,000) and EUR 63,266,000 (2024: EUR 27,157,000), respectively,
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
Impairment of financial assets at fair value through other comprehensive
income
The detail of this balance is comprised of:
(Thousands of euros)
2025
2024
Impairment of financial assets at fair value through other comprehensive income (note
24)
Charge for the year
10,940
10,255
Reversals for the year
(4,839)
(42)
6,101
10,213
Impairment of other assets
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Impairment of non-current assets held for sale (note 27)
Charge for the year
1,187
5,722
Reversals for the year
(2,158)
(1,398)
(971)
4,324
Impairment of tangible fixed assets (note 29)
Charge for the year
\u2014
184
(50)
184
Impairment of other assets (note 32)
Charge for the year
13,943
18,407
Reversals for the year
(3,452)
(5,339)
10,491
13,068
Impairment of real estate and other assets arising from recovered loans (note 32)
Charge for the year
11,880
33,875
Reversals for the year
(215)
(407)
11,665
33,468
21,135
51,044
Other provisions
This balance is comprised of:
(Thousands of euros)
2025
2024
Provision for guarantees and other commitments (note 39)
Charge for the year
79,248
34,826
Reversals for the year
(51,165)
(37,481)
28,083
(2,655)
Other provisions for liabilities and charges (note 39)
Charge for the year
523,282
588,351
Reversals for the year
(18,348)
(4,672)
504,934
583,679
533,017
581,024
The balance Other provisions for liabilities and charges - Charge for the year refers essentially to provisions for
legal risk accounted for by Bank Millennium, related to foreign currency-indexed mortgage loans, as described in
note 58, which, in 2025, amounted to EUR 480,973,000 (2024: EUR 506,195,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfExpensesByNatureExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-663": { "value": "
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other
services, is analysed as follows:
(Thousands of euros)
2025
2024
Auditing services
Statutory audit services
3,133
1,792
Other assurance services
1,877
1,140
Other services
732
899
5,742
3,831
For 2025 financial year, the fees relating to the statutory audit services provided to the companies in Poland are
also reported. KPMG was appointed as the Statutory Auditor of Bank Millennium and its subsidiaries on 24
February 2025, with the exception of Millennium Bank Hipoteczny (Mortgage Bank).
", "dimensions": { "concept": "ifrs-full:DisclosureOfAuditorsRemunerationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-664": { "value": "-5320000.0", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsWithContractualCashFlowsModifiedDuringReportingPeriodWhileLossAllowanceMeasuredAtLifetimeExpectedCreditLossesModificationGainLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-665": { "value": "Impairment of financial assets at amortised cost
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Loans and advances to credit institutions (note 21)
Charge for the year
471
216
Reversals for the year
(63)
(327)
408
(111)
Loans and advances to customers (note 22)
Charge for the year
745,135
804,883
Reversals for the year
(523,071)
(550,457)
Recoveries of loans and interest charged-off
(18,080)
(70,624)
203,984
183,802
Debt securities (note 23)
Associated to credit operations
Charge for the year
1,287
1,691
Reversals for the year
(5,788)
(3,099)
(4,501)
(1,408)
Not associated to credit operations
Charge for the year
71,342
35,485
Reversals for the year
(6,143)
(2,571)
65,199
32,914
60,698
31,506
265,090
215,197
The balances Impairment Loans and advances to customers and Debt securities not associated to credit
operations, include a net reversal of charge recorded in BIM - Banco Internacional de Mo\u00e7ambique, S.A., in the
amount of EUR 29,296,000 (2024: EUR 4,637,000) and EUR 63,266,000 (2024: EUR 27,157,000), respectively,
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
Impairment of financial assets at fair value through other comprehensive
income
The detail of this balance is comprised of:
(Thousands of euros)
2025
2024
Impairment of financial assets at fair value through other comprehensive income (note
24)
Charge for the year
10,940
10,255
Reversals for the year
(4,839)
(42)
6,101
10,213
Impairment of other assets
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Impairment of non-current assets held for sale (note 27)
Charge for the year
1,187
5,722
Reversals for the year
(2,158)
(1,398)
(971)
4,324
Impairment of tangible fixed assets (note 29)
Charge for the year
\u2014
184
(50)
184
Impairment of other assets (note 32)
Charge for the year
13,943
18,407
Reversals for the year
(3,452)
(5,339)
10,491
13,068
Impairment of real estate and other assets arising from recovered loans (note 32)
Charge for the year
11,880
33,875
Reversals for the year
(215)
(407)
11,665
33,468
21,135
51,044
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2025
2024
Stage 1
Gross amount
50,874,014
46,683,551
Impairment
(252,249)
(240,621)
50,621,765
46,442,930
Stage 2
Gross amount
6,382,660
6,891,393
Impairment
(296,454)
(265,533)
6,086,206
6,625,860
Stage 3
Gross amount
1,465,826
1,818,847
Impairment
(767,122)
(980,579)
698,704
838,268
Net amount
57,406,675
53,907,058
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,486,734
1,582,650
Charge for the year in net income interest
24,584
37,861
Other transfers
(187,332)
(992)
Impairment charge for the year (note 11)
745,135
804,883
Reversals for the year (note 11)
(523,071)
(550,457)
Loans charged-off
Write-offs
(66,162)
(97,731)
Credit assignments
(168,289)
(301,290)
Exchange rate differences
4,226
11,810
Balance at the end of the year
1,315,825
1,486,734
According to note 39, regarding the proceedings related to foreign currency-indexed mortgages of Bank
Millennium the amount of EUR 869,230,000 has been written-off from the gross carrying amount of loans portfolio
(31\u00a0December 2024: EUR 1,324,672,000).
The changes occurred in impairment of debt securities are analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Balance as at 1 January
7,308
8,668
Charge for the year in net income interest
548
48
Transfers
45,250
\u2014
Charge for the year (note 11)
1,287
1,691
Reversals for the year (note 11)
(5,788)
(3,099)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
48,604
7,308
Debt securities held not associated with credit operations
Balance as at 1 January
51,973
16,720
Other transfers
(3,429)
940
Charge for the year (note 11)
71,342
35,485
Reversals for the year (note 11)
(6,143)
(2,571)
Amounts charged-off
\u2014
(293)
Exchange rate differences
(7,022)
1,692
Balance at the end of the year
106,721
51,973
The balance Debt securities not associated to credit operations, includes a net reversal recorded at BIM - Banco
Internacional de Mo\u00e7ambique, S.A., in the amount of EUR 63,266,000 (31\u00a0December 2024: EUR 27,157,000),
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
The changes occurred in impairment of financial assets at fair value through other comprehensive income, are
analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,169
1,150
Transfers to fair value changes (note 44)
(6,101)
(10,213)
Impairment through profit and loss (note 12)
10,940
10,255
Reversals through profit and loss (note 12)
(4,839)
(42)
Exchange rate differences
14
19
Balance at the end of the year
1,183
1,169
The movements occurred in Impairment of investments in associates are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
45,451
46,355
Exchange rate differences
(3,310)
(904)
Balance at the end of the year
42,141
45,451
The changes occurred in Impairment of non-current assets held for sale are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
21,353
52,196
Other transfers
17,797
8,575
Charge for the year (note 13)
1,187
5,722
Reversals for the year (note 13)
(2,158)
(1,398)
Amounts charged-off
(10,474)
(43,808)
Exchange rate differences
(231)
66
Balance at the end of the year
27,474
21,353
The changes occurred in impairment for tangible fixed assets are analysed as follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
193
\u2014
Charge for the year (note 13)
\u2014
184
Reversals for the year (note 13)
(50)
\u2014
Amounts charged-off
(121)
\u2014
Exchange rate differences
(22)
9
Balance at the end of the year
\u2014
193
The changes occurred in Impairment of other assets, with the exception of impairment for Real estate and other
assets arising from recovered loans are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
135,421
184,992
Other transfers
705
(113)
Charge for the year (note 13)
13,943
18,407
Reversals for the year (note 13)
(3,452)
(5,339)
Amounts charged-off
(19,260)
(62,825)
Exchange rate differences
(305)
299
Balance at the end of the year
127,052
135,421
The changes occurred in impairment for Real Estate and other assets arising from recovered loans, are analysed as
follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
141,475
136,840
Other transfers
(18,179)
(8,461)
Charge for the year (note 13)
11,880
33,875
Reversals for the year (note 13)
(215)
(407)
Amounts charged-off
(4,993)
(21,891)
Exchange rate differences
(3,409)
1,519
Balance at the end of the year
126,559
141,475
Moreover, the following exposures and respective impairment are recorded in the Loans and advances to
customers portfolio and under the Guarantees provided and Irrevocable credit facilities items, in relation to
entities controlled by these funds:
(Thousands of euros)
Items
2025
2024
Loans and advances to customers
5,748
17,416
Guarantees granted and irrevocable credit lines
6,382
22,590
Gross exposure
12,130
40,006
Impairment
(561)
(2,160)
Net exposure
11,569
37,846
As at 31\u00a0December 2025, the financial instruments subject to impairment requirements under IFRS 9, (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2025
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,914
829
\u2014
\u2014
861,743
Loans and advances to customers (note 22)
50,871,677
6,376,942
1,449,026
24,855
58,722,500
Debt instruments (note 23)
24,052,457
605,864
35,879
\u2014
24,694,200
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
1,183
\u2014
16,016,415
Guarantees and other commitments (note 46) (**)
16,256,245
1,682,805
311,324
861
18,251,235
Total
107,973,881
8,749,084
1,797,412
25,716
118,546,093
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
(Thousands of euros)
Category
2025
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
488
10
\u2014
\u2014
498
Loans and advances to customers (note 22)
252,249
296,302
759,614
7,660
1,315,825
Debt instruments (note 23)
28,878
92,651
33,796
\u2014
155,325
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,183
\u2014
1,183
Guarantees and other commitments (note 39)
30,425
23,353
92,378
\u2014
146,156
Total
312,040
412,316
886,971
7,660
1,618,987
(Thousands of euros)
Category
2025
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,426
819
\u2014
\u2014
861,245
Loans and advances to customers (note 22)
50,619,428
6,080,640
689,412
17,195
57,406,675
Debt instruments (note 23)
24,023,579
513,213
2,083
\u2014
24,538,875
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
\u2014
\u2014
16,015,232
Guarantees and other commitments (note 46) (**)
16,225,820
1,659,452
218,946
861
18,105,079
Total
107,661,841
8,336,768
910,441
18,056
116,927,106
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
As at 31\u00a0December 2024, the financial instruments subject to impairment requirements under IFRS 9 (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2024
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,647
\u2014
\u2014
\u2014
797,647
Loans and advances to customers (note 22)
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Debt instruments (note 23)
21,331,504
68,499
4,449
\u2014
21,404,452
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
1,169
\u2014
12,873,806
Guarantees and other commitments (note 46) (**)
15,758,606
1,197,255
322,087
2,790
17,280,738
Total
97,443,191
8,150,841
2,124,346
32,057
107,750,435
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
(Thousands of euros)
Category
2024
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
112
\u2014
\u2014
\u2014
112
Loans and advances to customers (note 22)
240,621
265,341
969,138
11,634
1,486,734
Debt instruments (note 23)
55,407
641
3,233
\u2014
59,281
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,169
\u2014
1,169
Guarantees and other commitments (note 39)
13,831
15,261
88,947
\u2014
118,039
Total
309,971
281,243
1,062,487
11,634
1,665,335
(Thousands of euros)
Category
2024
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,535
\u2014
\u2014
\u2014
797,535
Loans and advances to customers (note 22)
46,442,176
6,619,746
827,503
17,633
53,907,058
Debt instruments (note 23)
21,276,097
67,858
1,216
\u2014
21,345,171
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
\u2014
\u2014
12,872,637
Guarantees and other commitments (note 46) (**)
15,744,775
1,181,994
233,140
2,790
17,162,699
Total
97,133,220
7,869,598
1,061,859
20,423
106,085,100
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
During 2025, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
240,621
265,341
969,138
11,634
1,486,734
Change in impairment losses:
Transfer to Stage 1
61,397
(51,481)
(9,864)
(52)
\u2014
Transfer to Stage 2
(19,960)
70,779
(50,819)
\u2014
\u2014
Transfer to Stage 3
(4,783)
(35,016)
40,066
(267)
\u2014
Changes occurred due to changes in credit risk
(54,671)
32,959
180,404
332
159,024
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Changes due to new financial assets and
derecognised financial assets and other variations
30,115
14,304
(306,145)
(2,045)
(263,771)
Impairment losses at the end of the year
252,249
296,302
759,614
7,660
1,315,825
During 2024, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
268,948
291,752
1,007,481
14,469
1,582,650
Change in impairment losses:
Transfer to Stage 1
63,989
(57,318)
(6,549)
(122)
\u2014
Transfer to Stage 2
(13,493)
45,311
(31,818)
\u2014
\u2014
Transfer to Stage 3
(5,250)
(40,730)
46,185
(205)
\u2014
Changes occurred due to changes in credit risk
(98,325)
19,729
240,744
979
163,127
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Changes due to new financial assets and derecognised
financial assets and other variations
27,866
9,583
(196,742)
(2,019)
(161,312)
Impairment losses at the end of the year
240,621
265,341
969,138
11,634
1,486,734
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based
on expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2025
2024
Amortised cost before changes
224,554
235,601
Impairment losses before changes
52,857
31,971
Net amortised cost before changes
277,411
267,572
Net gain/loss arising on changes
(9,097)
(5,338)
Net amortised cost after changes
268,314
262,234
The financial assets changed since the initial recognition at a time when the impairment loss was measured based
on the expected credit losses lifetime, are analysed as follows:
(Thousands of euros)
Financial assets changed
2025
2024
Amortised cost of financial assets for which credit losses expected to go from \"lifetime\" to
12 months
65,180
71,287
", "dimensions": { "concept": "ifrs-full:DisclosureOfImpairmentOfAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-666": { "value": "Other provisions
This balance is comprised of:
(Thousands of euros)
2025
2024
Provision for guarantees and other commitments (note 39)
Charge for the year
79,248
34,826
Reversals for the year
(51,165)
(37,481)
28,083
(2,655)
Other provisions for liabilities and charges (note 39)
Charge for the year
523,282
588,351
Reversals for the year
(18,348)
(4,672)
504,934
583,679
533,017
581,024
The balance Other provisions for liabilities and charges - Charge for the year refers essentially to provisions for
legal risk accounted for by Bank Millennium, related to foreign currency-indexed mortgage loans, as described in
note 58, which, in 2025, amounted to EUR 480,973,000 (2024: EUR 506,195,000).
Provisions
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Provision for guarantees and other commitments
146,156
118,039
Other provisions for liabilities and charges
1,092,357
967,819
1,238,513
1,085,858
Changes in Provisions for guarantees and other commitments are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
118,039
121,574
Transfers
\u2014
(1,105)
Charge for the year (note 14)
79,248
34,826
Reversals for the year (note 14)
(51,165)
(37,481)
Exchange rate differences
34
225
Balance at the end of the year
146,156
118,039
Changes in Other provisions for liabilities and charges are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
967,819
631,529
Transfers
5,193
(9,801)
Charge for the year (note 14)
523,282
588,351
Reversals for the year (note 14)
(18,348)
(4,672)
Amounts charged-off
(399,464)
(171,771)
Allocation to loan's portfolio (note 22)
4,485
(75,275)
Exchange rate differences
9,390
9,458
Balance at the end of the year
1,092,357
967,819
The balance Other provisions for liabilities and charges - Charge for the year refers essentially to provisions for
legal risk accounted for by Bank Millennium, related to foreign currency-indexed mortgage loans, as described in
note 58, which amounted to EUR 480,973,000 (31\u00a0December 2024 : EUR 506,195,000).
The Other provisions for liabilities and charges were based on the probability of occurrence of certain
contingencies related to risks inherent to the Group's activity, being reviewed at each reporting date in order to
reflect the best estimate of the amount and respective probability of payment.
This balance includes provisions for lawsuits, frauds and tax contingencies. The provisions constituted to cover tax
contingencies amounted to EUR 52,587,000 (31\u00a0December 2024: EUR 55,927,000).
Additionally, there are provisions for liabilities and charges recorded for corporate restructuring funds and carved-
out assets of the Project Crow.
Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium
(Poland)
Bank Millennium estimated the impact of legal risk on the recoverability of the expected cash flows resulting from
concluded contracts for the active portfolio of mortgage loans in CHF, adjusting, in accordance with point B5.4.6
of IFRS 9, the gross carrying amount of the portfolio by reducing the expected cash flows from mortgage loan
contracts denominated or indexed to CHF, and recognised a provision in accordance with International
Accounting Standard 37 Provisions, Contingent Liabilities and Contingent Assets (\u201cIAS 37\u201d) for fully repaid loans
and in a situation where the gross carrying amount of the loan was lower than the value of the assessed risk.
A detailed description of the adopted valuation methodology is presented in note 58 \"Legal risk related to foreign
currency mortgage loans in Bank Millennium (Poland)\".
As at 31\u00a0December 2025, the Loans and advances to customers portfolio in CHF has a gross amount of EUR
1,043,576,000 (31\u00a0December 2024: EUR 1,642,802,000).
As at 31\u00a0December 2025, the provisions estimated by Bank Millennium to address the legal risk related with the
portfolio of foreign currency-indexed mortgage loans amount to EUR 1,684,540,000 (PLN 7,113,474,000), of which
EUR 869,230,000 (PLN 3,670,583,000) are presented under assets, as a deduction from the gross amount of the
loan portfolio in CHF (note 22) and EUR 815,310,000 (PLN 3,442,891,000) are presented under Provisions. \u00a0
As at 31\u00a0December 2024, the provisions estimated by Bank Millennium to address the legal risk related to foreign
currency-indexed mortgage loans amounted to EUR 1,979,025,000 (PLN 8,463,696,000), of which EUR
1,324,672,000 (PLN 5,665,224,000) are presented under assets, as a deduction from the gross amount of the loan
portfolio in CHF (note 22) and EUR 654,353,000 (PLN 2,798,472,000) are presented under Provisions.
The variation in the level of provisions or concrete losses will depend on the final court decisions about each case
and on the number of court cases, as described in accounting policy 1 Y7 and note 58.
Mozambique's sovereign debt
In 2024 and following the political and social situation in Mozambique as a result of the disputed presidential
election results, Standard & Poor's ('S&P') downgraded Mozambique's sovereign debt rating (in local currency) in
October 2024.
On 19 February 2025, S&P downgraded its long-term government debt rating by 1 notch from CCC to CCC-, due to
liquidity challenges and apparent delays in payments to domestic creditors.
On 21 March 2025, S&P downgraded the rating of Mozambique's long-term local currency sovereign debt again
from CCC- to SD (Selective Default).
On 10 October 2025, S&P maintained the aforementioned ratings. This assessment by S&P Global Ratings
reinforces the need for close monitoring of the evolution of Mozambique's sovereign risk.
Considering the impairment model defined by the Banco Internacional de Mo\u00e7ambique, the total impairment
loss of public debt (which includes bonds and credit) totalled MZN 4,348 million (EUR 57.9 million) as at 31
December 2025. Additionally, in order to strengthen the balance sheet in the face of increased sovereign risk, an
overlay of MZN 4,618 million (EUR 61.5 million of which, EUR 17.1 million was for loans for customers and EUR 44.4
million for public debt securities.) was estimated, with the stock of impairment reaching the amount of MZN 8,966
million (EUR 119.4 million).
The impact on the results for 2025 is MZN 5,902 million (EUR 82.1 million), which includes the aforementioned
overlay.
As at 31\u00a0December 2025, the subsidiary BIM's exposure to the State of Mozambique includes public debt securities
denominated in Metical classified as Financial assets measured at amortised cost - Debt instruments in the gross
amount of MZN 43,197,478,000 corresponding to EUR 575,468,000 (31\u00a0December 2024: MZN 35,364,638,000
corresponding to EUR 536,405,000) and Financial assets at fair value through other comprehensive income in the
gross amount of MZN 5,625,491,000 corresponding to EUR 74,942,000 (31\u00a0December 2024: MZN 9,396,711,000
corresponding to EUR 142,528,000).
As at 31\u00a0December 2025, the impairment for public debt securities amounts to MZN 6,907,818,000, corresponding
to EUR 92,024,000 (31\u00a0December 2024: MZN 2,358,324,000, corresponding to EUR 35,771,000). The impact on
results is MZN 4,560,411,000 in 2025 (EUR 63,418,000) (2024: MZN 2,372,954,000 (EUR 34,404,000)).
Additionally, the Group has also recorded as at 31\u00a0December 2025, in the balance Loans and advances to
customers, a direct gross exposure to the Mozambican State in the amount of MZN 18,876,659,000 corresponding
to EUR 251,471,000 (31\u00a0December 2024: MZN 17,791,809,000 corresponding to EUR 269,863,000) and in the balance
Guarantees granted revocable and irrevocable commitments, an amount of MZN 2,335,930,000 corresponding to
EUR 31,122,000 (31\u00a0December 2024: MZN 2,943,963,000 corresponding to EUR 44,600,000).
As at 31\u00a0December 2025 considering the 66.7% indirect investment in BIM, the Group's interest in BIM's equity
amounted to EUR 315,832,000 (31\u00a0December 2024: EUR 358,464,000), with the exchange translation reserve
associated with this participation, accounted in Group's consolidated equity, in a negative amount of EUR
171,221,000 (31\u00a0December 2024: negative amount of EUR 128,243,000). BIM's contribution to consolidated net
income, attributable to the shareholders of the Bank, was a positive amount of EUR 2,258,000 (31\u00a0December 2024:
positive amount of EUR 32,322,000).
Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37
are the following:
1. In 2012, the Competition Authority (\u201cAdC\u201d) filed an administrative offence proceedings for alleged practices
restricting competition (proceedings PRC 2012/9). On 6 March 2013, it carried out measures of search and seizure
at Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) and other credit institutions facilities, where it seized
documents relevant to the investigation of an alleged exchange of sensitive commercial information between
credit institutions in the national market.
The proceedings were subject to justice secrecy by decision of the AdC, considering that the interests of the
investigation and the rights of the procedural parties would not be specifically compatible with the publicity of the
proceedings. On 2 June 2015, the Bank was notified of an infringement notice (\"NI\") adopted by the AdC in the
context of the investigation of proceedings PRC 2012/9, accusing it of participating, together with 14 other credit
institutions, in an exchange of sensitive commercial information, regarding the offer of credit products in retail
banking, namely home loan, consumer loan and corporate loan.
On 9 September 2019, the AdC adopted a final decision in this proceedings, and convicted the Bank to pay a EUR
60 million fine on the grounds that it had participated in a system of sharing confidential information between
competitors regarding home loan, consumer loan and corporate loan.\u00a0 BCP disagreed with the Decision, which it
considers having a set of serious defects, both in fact and in law, and appealed against it to the Competition Court
(CRSC) on 21 October 2019, requesting that it be annulled and that the appeal be given suspensive effect. On 8
May 2020, the appeal was admitted. On 21 December 2020, BCP submitted, which the Competition Court
accepted, a bank guarantee issued by the Bank itself as a way of fulfilling the bail. By order of 1 March 2021, the
Competition Court granted suspensive effect to the judicial objection appeal as to the sentencing decision. By
order of 20 March 2021, the Competition Court ordered the lifting of the justice secrecy and informed the
appellants that the trial should, in principle, begin in September 2021.
On 28 April 2022, the CRSC ruled within proceedings Proc. n.\u00ba 225/15.4YUSTR-W, regarding the judicial objection
appeal as to the decision of the Competition Authority of September 2019 (PRC/2012/09).
In this extensive ruling, the CRSC listed the facts given as proven, both in the administrative phase and in the trial,
however, at this stage, the CRSC did not concluded that the facts have been proven are legally based, nor,
consequently, that fines should be imposed, and the CRSC has instead chosen to make a reference for a
preliminary ruling to the Court of Justice of the European Union (CJEU) to answer two questions referred for a
preliminary ruling, requesting that this reference follow further terms in the form of an expedited procedure in
view of the limitation risk. It should be noted that the CJEU was not responsible for judging the case, but only for
interpreting the rules of Community law by answering in abstract to the questions referred to it by the national
court.
The CJEU rejected the CRSC's request for an expedited procedure and for priority to be given in the examination
of this proceedings.
On 29 July 2024, the CJEU delivered its judicial ruling in which it gave the following interpretation on the
questions referred by the CRSC:
\"Article 101(1), TFEU to be interpreted as meaning that a comprehensive reciprocal and monthly exchange of
information between competing credit institutions, carried out on highly concentrated markets with high barriers
to entry, and which regards the conditions applicable to transactions carried out on those markets, in particular
spreads and risk variables, current and future ones, as well as the individualised production values of the
participants in that exchange, to the extent that, at least, those spreads thus exchanged are those that those
institutions intend to apply in the future, must be qualified as a restriction of competition by object.\"
After the judicial Ruling, the proceedings returned to the CRSC, which issued an order on 30 July 2024, notifying
the Banks (i) of the appointment of 18 September 2024 for oral arguments, of an optional nature, limited to the
content of the CJEU Ruling; and (ii) the designation of 20 September 2024 for the reading of the Ruling, in the part
relating to the Law and the section.
On 20 September 2024, the CRSC issued its Final Ruling in which it deemed that an offence by object committed
by the Appellants BPN/BIC, BBVA, BPI, BCP, BES, Popular/Santander, Santander, Barclays, Caixa Agr\u00edcola,
Montepio, CGD and UCI, embodied in an exchange of sensitive information between competitors, was verified in
the case files.
In its Ruling, the CRSC confirmed the EUR 60 million fine imposed by the AdC on the Bank.
On 14 October 2024, the Bank filed its appeal with the Lisbon Court of Appeal (TRL), which, by decision issued on
10 February 2025 by its Intellectual Property, Competition and Supervision Section, decided, by majority, to declare
the pending administrative offence proceedings against the Defendant companies in relation to the practice of
the aforementioned administrative offence to be barred and ordered the timely filing of the case.
In summary, the TRL considered that the facts occurred between 2002 and March 2013, applying the 2012
Competition Law, which provides for the maximum limitation period for administrative offence proceedings of 10
years and 6 months, and not applying the 2022 Competition Law, which provides for a longer period of suspension
of the limitation period for administrative offence proceedings (either because the legislator so determined, or
because it is more unfavourable than the 2012 Competition Law).
Moreover, the reference for a preliminary ruling (made by the TCRS to the CJEU) does not suspend
(autonomously) the limitation period.
The TRL also considered that the limitation occurred on 1 September 2023 or, at the limit, applied to the so-called
Covid-19 laws, on 11 February 2024.
The Public Prosecutor's Office appealed against this decision to the Lisbon Court of Appeal and the Competition
Authority appealed to the Constitutional Court.
The Lisbon Court of Appeal rejected the Public Prosecutor's Office's claims of nullity regarding the statute of
limitations.
The Competition Authority and the Public Prosecutor's Office then filed appeals to the Constitutional Court
against the Lisbon Court of Appeal's ruling of 10 February 2025, which declared the statute of limitations for the
administrative offense proceedings to be time-barred.
Both the Competition Authority and the Public Prosecutor's Office raised questions of unconstitutionality related
to the exclusion of preliminary references to the CJEU as a ground for suspending the statute of limitations in
administrative offense proceedings. While the Competition Authority focused on the uniform application of
European law and the effectiveness of the competition sanctions regime, pointing out violations of the principles
of the Primacy of European Union Law and Effective Legal Protection, the Public Prosecutor's Office have adopted
a broader approach, also including violations of the Principle of Equality.
These appeals were admitted by the Regional Court of Appeal and were brought before the Constitutional Court.
The Constitutional Court admitted these appeals and issued a Summary Decision on 4 June 2025, disregarding
the appeals filed by the Competition Authority and the Public Prosecutor's Office.
Following this Summary Decision, the Competition Authority filed an appeal against the Constitutional Court's
individual decision to disregard the appeals filed by the Competition Authority and the Public Prosecutor's Office,
which the Constitutional Court is currently awaiting.
On 25 August 2025, the Constitutional Court issued its judgment dismissing the complaint filed for review by this
Court, confirming its Summary Decision of 4 June 2025, regarding the inadmissibility of the appeal.
In light of this Constitutional Court judgment, the Lisbon Court of Appeal's judgment of 10 February 2025 became
final, making the decision declaring the statute of limitations for the administrative offence proceedings final. This
concluded the proceedings and eliminated the payment of any fines by the Banks.
1-A. In relation to this administrative offence proceeding of the Competition Authority PRC/2012/09, and in view of
the alleged damage caused by the targeted and defendant Banks to bank customers, resulting from the alleged
sharing of confidential information between the Banks relating to home loan, consumer loan and corporate loan,
three declaratory popular actions of conviction were filed against the Bank and several other banking institutions.
These proposed popular actions aim to compensate consumers and companies affected by alleged harm caused
by the alleged anti-competitive practice. Actions vary depending on the group of consumers and companies
represented and the damages calculated.
It should be noted that the decision issued by the Lisbon Court of Appeal on 10 February 2025, which decided to
declare the administrative offence proceedings PRC/2012/09 barred, does not extinguish these popular actions,
which will now fully continue as \"stand alone\", not taking advantage of the presumption of evidence produced in
this case.
1-A.1. On 11 March 2024, BCP, along with 8 banking institutions, was summoned, to plead a \"popular declaratory
action of conviction in the form of a common proceeding aimed at the protection of competition, consumer
rights, and diverse and/or collective interests associated with the consumption of goods and services\", an action
brought by Ius Omnibus Association, which is under no. 2/24.1YQSRT in the Competition, Regulation and
Supervision Court, entirely based on the alleged competition offence in home and consumer loan transactions
declared in the AdC's Ruling of 9 September 2019 (PRC/2012/09), a ruling that was subject to a judicial objection
appeal by BCP, an objection that has not yet been definitively judged.
In this case, the Plaintiff makes the following main claims:
1. To be declared that, from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101(2) of the TFEU and (subsequently) article 2 of Decree-Law no. 371/393 and article 4 of Law no. 18/2003,
by exchanging strategic, non-public, current and future information, with its competitors, in a disaggregated,
individualised and regular manner, namely, on their respective offers of home loan and consumer loan;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Alternatively to section 2, to be declared that the Defendants' practice has led to their unjust enrichment at the
expense of the impoverishment of all the consumers represented;
4. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question in the amount resulting from the sum of several
factors.
5. To be declared the nullity of the clause(s) that fix the spread rate in home loan agreements and consumer loan
agreements entered into by consumers represented during the relevant period, the aforementioned clause(s)
being consequently reduced in the part corresponding to the unlawful overprice, in agreements whose validity
exceeds the date of the final judgment, and in which the Defendants are lenders, because they were entered
into by them or by subsequent termination of the contractual position.
As the deadline for the pleading is running, the Bank was notified on 9 May 2024 that an order had been issued
ordering the suspension of the proceedings until the final judgment to be rendered in proceeding no.
225/15.4YUSTR-W (the judicial objection appeal of the administrative offence proceeding PRC/2012/09), before this
Competition, Regulation and Supervision Court.
At the time, the TCRS also determined that, as soon as the administrative proceeding became final, the records of
Case n\u00ba. 2/24.1YQSTR would be notified.
The judgment of the administrative proceeding became final on 11 September 2025, as the Bank was notified of
the Court order lifting the suspension of Case No. 2/24.1YQSTR, the respective Response was submitted on the 24
February 2026.
1-A.2. On 8 April 2024, BCP, along with 9 banking institutions, was summoned to oppose another case brought
by Ius Omnibus Association against the banks, under no. 6/24.4YQSTR, also related to the aforementioned Ruling
of the AdC of 9 September 2019 (PRC/2012/09), this case being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No. 18/2003, by
exchanging strategic, non-public, current and future information with their competitors, in a disaggregated,
individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that the Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question, associated with the credits to the companies entered
into between the Defendants and companies in Portugal, in the period from May 2005 to September 2012, with
regard to the overprice that was passed on by the companies to the represented consumers, and charged
directly by the Defendants, in a global amount to be fixed and determined considering several factors.
On 18 November 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
On 8 January 2025, the Court ordered the attachment of Case n\u00ba 10/24.2YQSRT, identified below, to this case.
On 8 July 2025, the TCRS issued an Order of Acquittal of the Instance regarding the claims filed by IUS Omnibus
because the class of defendants was not adequately defined by Plaintiff Ius Omnibus.
Essentially, the TCRS found that the AIO failed to identify the small and medium-sized Portuguese companies that
contracted corporate loans in Portugal during the period of the alleged infringement, as stated in the Initial
Petition, nor was this publicly available. Indeed, it would be virtually impossible for the alleged defendants to
identify these companies and, therefore, guarantee their future claim for individual compensation.
The TCRS ruling of 8 July 2025, has already become final and was not appealed by the AIO. Consequently, the
Defendants (including BCP) were acquitted of the action brought by the AIO.
However, it is worth noting that, given that the action in Case No. 10/24.2YQSRT (the AMPEMEP action, which we
will discuss in section 1-A.3. below) was joined to the action in Case No. 6/24.4YQSRT, the AIO's action is addressed
separately in section 1-A.3.
1-A.3. On 24 April 2024, BCP, along with 9 banking institutions, was summoned to oppose an action brought by
Association of Portuguese Micro, Small and Medium Enterprises (AMPEMEP) against the banks, initially under no.
10/24.2YQSRT, also related to the aforementioned AdC\u2019 Decision of 9 September 2019 (PRC/2012/09), this case also
being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous
practice, article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No.
18/2003, by exchanging strategic, non-public, current and future information with their competitors, in a
disaggregated, individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice
paid as a result of the anti-competitive practices in question, associated with the credits to the companies
entered into between the Defendants and companies in Portugal, in the period from May 2005 to September
2012, with regard to the overprice that was passed on by the companies to the represented consumers, and
charged directly by the Defendants, in a global amount to be fixed and determined considering several
factors.
On 17 December 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
In view of the similarity of the object and parts of these 3 popular actions, the possibility of joining them was
raised, and BCP was notified, in the context of proceeding no. 6/24.4YQSTR (point 1-A.2.above) to rule on the
joinder to this action of proceeding no. 10/24.2YQSTR (point 1-A.3.above).
The Bank has commented on this issue, requesting the opposite, that is, that proceeding no. 6/24.4YQSTR be
joined to proceeding no. 10/24.2YQSTR instead, requesting that the logical precedence relationship between this
proceeding and that one be declared, and that the Judge in charge of proceeding no. 10/24.2YQSTR should be
granted the decision to join proceeding no. 6/24.4YQSTR.
On 8 January .2025, the Court ordered this to be attached to Process No. 6/24.4YQSRT.
Following the Preliminary Hearing on 10 July 2025, by a Corrective Order, the TCRS (Court of Appeals) ruled that
the Defendants, including BCP, be acquitted of the claims for compensation, considering that AMPEMEP lacks
standing to bring them due to the insufficient definition of the represented class and the failure to demonstrate
homogeneity among the allegedly represented companies.
However, the TCRS found that AMPEMEP has standing to request a declaration of wrongdoing in the corporate
credit segment, which is why the lawsuit proceeds without the Defendants, including BCP, being ordered to pay
compensation.
The Court also invited AMPEMEP to identify the articles of the Initial Petition that embody the violation (limited to
information on corporate credit) and the respective evidence. AMPEMEP filed its request to this effect on 9
October 2025. On the 3rd of November 2025 we indicated our means of proof.
The Bank was notified of the request to lodge a per saltum appeal with the Supreme Court of Justice and of the
respective plea, dated 27 October 2025, and in early December 2025 it submitted its reply to pleadings.
As the evolution of the case and its outcome are currently unpredictable, the case is currently proceeding to
appraisal of the merits of the declaratory claim, in terms of competition law infringement.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and
Jos\u00e9 Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo
Banco, S.A. and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the
defendant banks and the financial system, without which they would have sold the pledged shares and paid their
loans. If this is not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to
Funda\u00e7\u00e3o Jos\u00e9 Berardo for damages caused by breach of contract, since the moment when they should have
been sold in execution of the pledge due to failure to verify coverage ratios until the moment\u00a0 when they were
sold, that is, the difference between the price at which the pledged shares would have been sold on the dates of
coverage ratios default and the price at which they were actually sold, plus interest and all other loan charges
since those dates, in any case the global amount of compensation not being less than EUR 800,000,000. In any
case, the plaintiffs ask the defendant banks to be jointly condemned to pay Jos\u00e9 Manuel Rodrigues Berardo
compensation for moral damages, in the already calculated amount of EUR 100,000,000 and also in the amount
that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of
Ministers, published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9
Berardo, was declared extinct. This decision was legally contested by the Jos\u00e9 Berardo Foundation, and in April
2023, the Administrative and Fiscal Court of Funchal cancel the decision that ordered its extinction. Dissatisfied,
the Portuguese State appealed against this latter and is awaiting the outcome.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
Nothing relevant to the judgment on the merit of the case happened. The lawsuit is suspended until the motions
submitted by FJB in the execution filed by the Banks (8489/19.8T8LSB) have been definitively judged.
On 31 December 2025, the action remains suspended.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the
respective financial statements.
3. On 3 January 2018, Bank Millennium received a decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman), in which the OPCC Chairman found infringement by Bank
Millennium of the rights of consumers. In the opinion of the OPCC Chairman the essence of the violation is that
Bank Millennium informed consumers (it regards 78 agreements) in responses to their complaints, that the court
verdict stating the abusiveness of the provisions of the loan agreement regarding exchange rates does not apply
to them. According to the position of the OPCC Chairman the abusiveness of contract\u2019s clauses determined by the
court in the course of abstract control is constitutive and effective for every contract from the beginning. As a
result of the decision, Bank Millennium was obliged to:
1) send information on the UOKiK\u2019\u2019s decision to the said 78 customers;
2) place the information on decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (EUR 4.9 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium
appealed against the judgment within the statutory deadline. The court presented the view that the judgment
issued in the course of the control of a contractual template (in the course of an abstract control), recognising the
provisions of the template as abusive, determines the abusiveness of similar provisions in previously concluded
contracts. Therefore, the information provided to consumers was incorrect and misleading. As regards the penalty
imposed by OPCC, the court pointed out that the policy of imposing penalties by the Office had changed in the
direction of tightening penalties and that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the
perspective of today's case-law views on the importance of abstract control (it was not until January 2016 that the
Supreme Court's resolution supporting the view of the OPCC Chairman was published), the more penalties for
these behaviours should not be imposed using current policy. The above constitutes a significant argument
against the validity of the judgment and supports the appeal which Bank Millennium submitted to the Court of
second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. On 3 July
2024, the Supreme Court issued a decision accepting the cassation appeal for consideration. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is
positive and therefore no provision has been recognised.
4. Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC
Chairman recognised the practice of participating banks, including Bank Millennium, in an agreement aimed at
jointly setting interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of
competition, and by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2
million (EUR 2.9 million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection.
Bank Millennium has created a provision in the amount equal to the imposed penalty.
5. Bank Millennium is a defendant in two court proceedings, in which the subject of the dispute is the amount of
the interchange fee. The total value of claims reported in these cases is PLN 729.2 million (EUR 172.7 million). The
procedure with the highest value of the reported claim is the case is brought by PKN Orlen SA, the plaintiff
demands payment of PLN 635.7 million (EUR 150.5 million). The plaintiff in this proceeding alleges that the banks
acted under an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2006-2014. In this case, Bank Millennium was sued jointly with another
bank and card organisations. On 19 December 2025, the District Court in Warsaw dismissed in full the claims of
PKN Orlen S.A. The judgment is not final. In the case brought by LPP S.A. the allegations are similar to those raised
in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated as 2008-2014. In this
case, the Bank is sued jointly and severally with another bank. The case was resolved positively for the Bank by the
courts of both instances, and is currently at the stage of a cassation appeal filed by LPP S.A. The Supreme Court
did not issue a decision regarding the acceptance of the cassation appeal for consideration. According to current
estimates of the risk of losing a dispute in these matters, Bank Millennium did not create a provision.
In addition, we point out that Bank Millennium participates as a side intervener in three other proceedings
regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks of acting
as part of an agreement restricting competition on the acquiring services market by jointly setting the level of the
national interchange fee in the years 2008-2014.
The Bank believes that the prognosis regarding the litigation chances of winning the case is positive and therefore
no provision has been recognised.
- A lawsuit brought up by shareholder of PCZ S.A. in bankruptcy (PHM, then the European Foundation for Polish-
Belgian Cooperation - EFWP-B, currently called The European Foundation for Polish-Kenyan Cooperation) against
Bank Millennium S.A., worth of the dispute PLN 521.9 million (EUR 123.6 million) with statutory interest from 5 April
2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the Regional Court in Warsaw;
the suit was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis for the claim is damage
to their assets, due to the actions taken by Bank Millennium and consisting in the wrong interpretation of the
Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which resulted in placing
the loan on demand. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with the
charges raised in the claim. Supporting the position of Bank Millennium, the Bank's attorney submitted a binding
copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state in
the action brought by PCZ SA against Bank Millennium. On 10 May 2023, the Court of First Instance announced a
judgment dismissing the claim in its entirety. The verdict is not final, the plaintiff filed an appeal.
On 6 May 2024, the Bank Millennium's representative submitted a response to the appeal, requesting that it be
dismissed in its entirety as unfounded. On 17 December 2024, the Court of Appeal in Warsaw issued a judgment
favourable to the Bank, dismissing the Plaintiff's appeal. The judgment is final. The Bank has been served with the
Plaintiff\u2019s cassation complaint and has submitted a formal response. On 19 December 2025, the cassation appeal
was admitted for consideration.
Bank Millennium believes that the prognosis regarding the litigation chances of winning the case is positive and
therefore no provision has been recognised.
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors
(initially covering 454 borrowers party to 275 loan agreements) is represented by the Municipal Consumer
Ombudsman in Olsztyn. The plaintiffs demanded payment in the amount of PLN 3.5 million (EUR 0.8 million),
claiming that the clauses of the agreements, pertaining to the low-down payment insurance, are unfair and thus
not binding. Plaintiff extended the group in the court letter filed on 4 April 2018, therefore the claims increased
from PLN 3.5 million (EUR 0.8 million) to over PLN 5 million (EUR 1.2 million).
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings
and submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The
value of the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (EUR 1,745,449.9).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff
and decided to take witness evidence in writing. On 18 October 2024, the Court adjourned the hearing without
setting a new date. The court decided to disregard the evidence from the hearing of the parties and obliged the
parties to submit documents - agreements concluded between the group members and the Bank and final
judgements regarding the agreements in question. The court adjourned the hearing without specifying a new
date.The Bank submitted the above-mentioned documents in a letter dated 17 December 2024, while the group
representative, in performance of the obligation, submitted two letters containing documents confirming the
legitimacy of individual group members. The court obliged the Bank to submit a position in response to the letters
of the group representative. The obligation has been fulfilled.
The Bank Millennium has recognised a provision for this case in the amount resulting from the expected cash
outflow - PLN 4.4 million (EUR 1 million).
As at 31 December 2025, there were also 66 individual court cases regarding LTV (loans-to-value) insurance (cases
in which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial
Ombudsman, in the lawsuit, demands that Bank Millennium and the Insurer Towarzystwo Ubezpiecze\u0144 Europa,
S.A. be ordered to discontinue performing unfair market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its web site, information on
use of unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts.
Nonetheless, if the practice is deemed to be abusive it may constitute grounds for future claims to be filed by
individual customers.
The case is being examined by the court of first instance. Bank Millennium believes that the prognosis regarding
the litigation chances of winning the case is positive and therefore no provision has been recognised.
8. By 31 December 2025, Bank Millennium received 2,355 lawsuits in which the plaintiffs (both customers and
companies purchasing claims), alleging violation of the information obligations and demanding reimbursement
of interest and other costs incurred in connection with taking out a loan.
As at 31 December 2025, 373 cases have been legally concluded, in 332 cases the Bank won the dispute and lost in
41 cases. Disputes in the above respect are subject to constant observation and analysis. In the cases in question,
the Bank makes an individual assessment of the litigation chances in each of the court cases, which is justified by
the lack of a uniform line of jurisprudence. For cases in which, in the Bank\u2019s assessment, the probability of losing
the dispute is higher than that of winning it, provisions are created in an amount resulting from the expected cash
outflow. The case-law of the Court of Justice of the European Union, which interprets the provisions relating to the
objections raised in national judicial proceedings, plays an important role in shaping the line of jurisprudence.
On 13 February 2025, the Court of Justice of the European Union (CJEU) issued a judgment in a case registered
under the reference number C472/23 as a result of an application filed by the District Court for the Capital City of
Warsaw. In its judgment, the CJEU, interpreting the provisions of Directive 2008/48/EC of the European
Parliament and of the Council of 23 April 2008 on consumer credit agreements, found that:
(i) Article 10(2)(g) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that the
fact that a credit agreement refers to an annual percentage rate of charge, which proves to be overstated because
certain terms of that agreement are subsequently found to be unfair, within the meaning of Article 6(1) of Council
Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, and, therefore, are not binding on the
consumer, does not constitute, in itself, an infringement of the obligation to provide information laid down in that
provision of Directive 2008/48.
(ii) Article 10(2)(k) of Directive 2008/48 must be interpreted as meaning that the fact that a credit agreement lists a
certain number of circumstances justifying an increase in the costs connected with the performance of the
agreement, without, however, a reasonably well-informed and reasonably observant and circumspect consumer
being in a position to ascertain whether they have arisen and their effect on those costs, constitutes an
infringement of the obligation to provide information laid down in that provision, where that indication is liable to
call into question the possibility for that consumer to assess the extent of his or her liability.
(iii) Article 23 of Directive 2008/48, read in the light of recital 47 of that directive, must be interpreted as not
precluding national legislation which provides, in the event of infringement of the obligation to provide
information imposed on the creditor in accordance with Article 10(2) of that directive, for a uniform penalty,
consisting of depriving the creditor of its right to interest and charges, irrespective of the individual level of
seriousness of such an infringement, where that infringement is capable of calling into question the possibility for
the consumer to assess the extent of his or her liability.
Following the judgment of the Tribunal, it is still up to the domestic courts to assess the possibility of crediting
non-interest costs of the loan and to assess compliance with the information obligation regarding the possibility
of changing fees. The CJEU also noted that the right to benefit from the free loan sanction is updated only if a
potential breach of the bank may undermine the consumer's ability to assess the scope of his liability.
On 9 October 2025, the Court of Justice of the European Union, in case registered under reference C\u201180/24,
following a request submitted by the District Court for Warsaw \u2013 \u015ar\u00f3dmie\u015bcie in Warsaw, while interpreting the
provisions of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC, as well as Council Directive 93/13/EEC of 5
April 1993 on unfair terms in consumer contracts, held that:
(i) Article 22(2) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that it
does not preclude national legislation allowing a consumer to assign to a third party, who is not a consumer, a
claim based on the infringement of a right granted to him under national provisions implementing that Directive.
(ii) Articles 6(1) and 7(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be
interpreted as meaning that a national court is not required to examine of its own motion the unfair nature of a
term in an assignment agreement concluded by a consumer, where the dispute pending before that court
between the assignee company and the trader does not concern that assignment agreement but rather the
consumer\u2019s claim against that trader.
On 21 March 2025, the Financial Stability Committee issued a resolution (No. 79/2025) on the position regarding
the risk associated with the sanction of free credit (SKD). The Committee noted that \"while the violations listed in
the Consumer Credit Act are of a varied nature and severity, the sanction itself is not subject to gradation. The
inability to moderate sanctions creates a system of incentives to instrumentally use the benefits of the SKD and to
undermine credit agreements, regardless of whether the violation has economic consequences for the borrower
or not.\"
On 19 September 2025, the Financial Stability Committee convened. In the communiqu\u00e9 issued following the
meeting, the Committee stated: \"in the context of SKD - related risk, the Committee concluded that the draft
Consumer Credit Act presented for public consultation did not adequately reflect the FSC\u2019s position on the risks
associated with the application of the free credit sanction. The Committee notes that no regulatory measures have
been introduced that sufficiently restrict the scope and possibility of applying this sanction. The Committee
continues to identify areas that may facilitate the misuse of legal provisions intended to protect consumers.\"
9. By 31 December 2025, Bank Millennium recorded the receipt of 241 lawsuits by borrowers of mortgage loans in
PLN for reimbursement of benefits provided under the loan agreement. Seven final and favourable rulings for the
Bank were issued. The borrowers' allegations focus on the WIBOR ratio as an incomprehensible, unverifiable
element affecting the consumer's liability, as well as the issue of insufficient information on the effects of variable
interest rates provided to the consumer by the bank before the conclusion of the contract.
On 12 February 2026, the Court of Justice of the European Union issued a judgment in case C\u2011471/24, which may
have great significance for the manner in which national courts examine disputes in the relevant scope. It appears
that this ruling will be invoked by banks in order to strengthen their argumentation against the allegations
formulated against the durability of contractual obligations.
The Court stated that:
i) Article 1(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (that is that: contract
terms reflecting mandatory statutory or regulatory provisions and the provisions or principles of international
conventions to which the Member States or the Community are parties, in particular in the field of transport, shall
not be subject to the provisions of this Directive), must be interpreted as meaning that: the exception provided
therein does not cover a term of a mortgage loan agreement providing for a variable interest rate based on a
reference index within the meaning of Regulation (EU) 2016/1011 of the European Parliament and of the Council of
8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the
performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No
596/2014, and on a fixed margin, if the statutory or regulatory provisions applicable to such a term establish only a
general framework for determining the interest rate of such agreements while simultaneously leaving the trader
the possibility of determining the contractual reference index or the fixed margin which may be added to the
value of that index.
2) Article 4(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a mortgage loan agreement relating to residential property contains a term providing for a
variable interest rate based on a reference index within the meaning of Regulation 2016/1011, the transparency
requirement resulting from that provision does not impose on the lender specific information obligations relating
to the methodology of that index. The circumstance that the lender fulfilled all information obligations imposed
on it by Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit
agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and
2013/36/EU and Regulation (EU) No 1093/2010, as amended by Regulation 2016/1011, in relation to such a term, and,
in the case of providing additional information, did not present indications that would give a distorted picture of
the said index, may indicate that the lender fulfilled this transparency requirement with regard to that term.
3) Article 3(1) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a term of a mortgage loan agreement specifies a variable interest rate based on a reference
index within the meaning of Regulation 2016/1011, the following cannot render that term unfair: first, the lack of
informing the consumer of certain specific features of the contractual reference index, in particular that the
methodology of that index provides for the use of input data not necessarily corresponding to actual transactions,
and that the lender is one of the banks providing data used to determine that index, and second, those specific
features themselves, provided that the said index could be regarded as compliant with that Regulation at the time
of conclusion of that agreement.
On 29 June 2023, the Polish Financial Supervision Authority (KNF) announced that it had assessed the ability of the
WIBOR interest rate reference index to measure the market and economic realities. The KNF stated that the
WIBOR interest rate reference index is capable of measuring the market and economic realities for which it was
established. According to the Commission's assessment, the WIBOR ratio responds appropriately to changes in
liquidity conditions, changes in central bank rates and economic realities.
On 26 July 2023, the Polish Financial Supervision Authority (PFSA) presented its position on legal and economic
issues related to mortgage loan agreements in Polish currency in which the WIBOR interest rate reference\u00a0 index\u00a0
is\u00a0 used. This position can be used in court proceedings and can then be treated as an 'amicus curiae' opinion. The
Polish Financial Supervision Authority stated that the WIBOR reference index meets all legal requirements. In the
opinion of the Polish Financial Supervision Authority, there are no grounds to question the credibility and legality
of WIBOR, in particular in the context of the use of this indicator in mortgage loan agreements in the Polish
currency.
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
10. Currently, in connection with the activities of Bank Millennium - as it is the case with the activities of other
banks in Poland - the President of the Office of Competition and Consumer Protection is conducting proceedings
on the use of practices infringing the collective interests of consumers as regards the so-called \"unauthorised
transactions\". In the opinion of the President of the Office of Competition and Consumer Protection, in the case of
Bank Millennium, such actions include the following:
(i) failure \u2013 no later than by the end of the business day after the date of receipt of an appropriate notification from
the consumer regarding the occurrence of an unauthorised payment transaction \u2013 to refund the amount of the
unauthorised payment transaction or to restore the debited payment account to the state that would have
existed if the unauthorised payment transaction had not taken place, despite the lack of justified and duly
documented grounds to suspect fraud on the part of the consumer and informing the authorities appointed to
prosecute crimes about this suspicion in writing, as well as;
(ii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with information about the verification by the payment service provider of the correct use of the
payment instrument by using individual authentication data in a way suggesting that the Bank's demonstration
only that the disputed payment transactions have been correctly authenticated constitutes at the same time
demonstration of the authorisation of such a transaction and excludes its obligation to return the amount of the
unauthorised transaction and;
(iii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with false information about authorisation of the transactions questioned by consumers, while
presenting information indicating that the transactions took place as a result of an intentional or grossly negligent
violation by consumers of at least one of the obligations referred to in Article 42 of the Payment Services Act and
in the agreement between the consumer and the bank, as a result of which they are liable for the questioned
payment transactions.
In the course of the proceedings, the Bank provided appropriate explanations and also substantively referred to
the allegations formulated by the President of the Office of Competition and Consumer Protection. The
proceedings have been extended until the end of June 2026.
On 18 April 2025, Bank Millennium filed an application for a binding decision pursuant to Article 28 section 1 of the
Act on Competition and Consumer Protection. The application (proposal) includes all allegations presented by the
UOKiK, i.e. changes in the procedure for handling reports regarding unauthorised payment transactions, changes
in the classification of a given transaction as authorised and changes in complaint response templates. The
application also includes a proposal for \"compensation\" for customers whose complaints were rejected. Currently,
discussions with the President of the UOKiK regarding the issuance of a commitment decision are still ongoing.
In connection with the proceedings, the Bank Millennium recognised a provision as at the end of December 2025
in the amount of PLN 82 million (EUR 19.4 million) based on estimated outflow of funds.
As at 31 December 2025, the Bank Millennium was a party to 352 court proceedings in which customers
questioned the fact of their authorisation of a transaction. In the cases in question, the Bank Millennium makes an
individual assessment of the litigation chances in each of the court cases. In cases where, in the Bank's opinion,
there is a greater probability of losing the dispute than winning it, provisions in the amount resulting from the
potential loss of the Bank are created.
As at 31 December 2025, the total value of the subjects of the other litigations in which the Bank Millennium
Group\u2019s companies appeared as defendant, stood at PLN 5,060.6 million (EUR 1,198.4 million) (2024: PLN 6,186.4
million (EUR 1,446.5 million), excluding the class actions described in note 58. In this group the most important
category are cases related with FX loans mortgage portfolio.
11. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to EUR 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -,
filed against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they
acted pursuant to a request made by the Bank for the making of the respective purchases, and also that the court
orders the cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due
to relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs
and to refund them the cost they incurred while complying with that mandate, namely, EUR 90,483,816.83
regarding Banco Esp\u00edrito Santo, S.A. (BES) and EUR 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD),
plus default interests;
d) the amount of the lawsuit determined by the plaintiffs is EUR 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff
company in the amount of EUR 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report submitted.
In November 2022 the Bank complained about the Experts' Report: (i) they considered documents that the Court
had ordered to be removed from the proceedings, which had not been done due to the Court's inertia, (ii) they
considered written notes on documents, that may have been written by the entities that initiated the process, and
(iii) they did not consider much information that was contained in the statements, and (iv) they made errors in the
calculation of interest and the amount of financing granted. In view of the experts' new reply, BCP claimed all the
expertise, in March 2023. For the Court's final decision, BCP added, in June 2025, a set of documents supporting its
position.
On 31 December 2025, complaints regarding the expert assessment remain pending.
12. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal
applied a resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the
Decree-law 298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial
transfer of assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo
Banco, S.A. (Novo Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope
of this process, the Resolution Fund made a capital contribution to Novo Banco amounting to EUR 4,900 million,
becoming, on that date, the sole shareholder. Further, in accordance with information published on the
Resolution Fund\u2019s website, the Resolution Fund borrowed EUR 4,600 million, of which EUR 3,900 million were
granted by the Portuguese State and EUR 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities
emerging from the \u201ceventual negative effects of future decisions regarding the resolution process that may result
in liabilities or contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken,
following the publication of the report on the result of the independent evaluation, made to estimate the level of
credit recovery for each category of creditors under a hypothetical scenario of a normal insolvency process of BES
on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would
hypothetically take if BES had gone into liquidation right before the application of the resolution measure, such
creditors shall be entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the
total acknowledged credits, including capital, remunerative and default interest amounts to EUR 5,056,814,588, of
which EUR 2,221,549,499 are common credits and EUR 2,835,265,089 are subordinated claims, and no guaranteed
or privileged claims exist. Both the total number of acknowledged creditors and the total value of the
acknowledged credits and their ranking will only be ultimately determined upon the definitive judicial judgement
of the verification and ranking of credits to be given in the liquidation proceedings.
According to the Resolution Fund\u2019s Annual Report of 2024, \"in 2019, the Resolution Fund was informed that the
credits (it) claimed had not been recognised by the Liquidation Commission of BES \u2013 In Liquidation, whilst the
Resolution Fund filed an objection to the list of creditors with the Lisbon District Court, requesting that the credits
it claimed be recognised. The challenge was upheld and the Liquidation Committee of BES \u2013 In Liquidation
appealed. In 2023, the Lisbon Court of Appeal issued a judgement dismissing the appeal of the Liquidation
Commission of BES - In Liquidation, and in favour of the position defended by the Resolution Fund, confirms the
decision of the Court of First Instance and the recognition of the credits claimed by the Resolution Fund as
privileged credits. The Liquidation Commission of BES - In Liquidation, filed an appeal for review before the
Supreme Court of Justice, which issued a judgement in July 2023, which has already become final, recognising,
and classifying as privileged the credits claimed by the Resolution Fund for the total amount of EUR 1,242,568.9
thousand\".
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed
and is underway. According to note 25 of the Resolution Fund\u2019s Annual Report of 2024, \u201cLegal actions related to
the application of resolution measures have no definitive legal precedents, which makes it impossible to use case
law in its evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026)
The Resolution Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and
procedural information available so far, considers that there is no evidence to cast doubt on their belief that the
probability of success is higher than the probability of failure\u201d.
According to note 24 of the Resolution Fund\u2019s Annual Report of 2024, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco
de Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently
signed the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a
total of EUR 1,000 million in Novo Banco, of which EUR 750 million at completion and EUR 250 million within a
period of up to 3 years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco
and the Resolution Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the
performance of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align
incentives as well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new
shareholder of EUR 750 million, followed by a further capital increase of EUR 250 million by the end of 2017. Upon
completion of the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the
purposes of the resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding
the approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support
measures by the Resolution Fund and the Portuguese State that are part of the sale agreement associated with a
total gross book value of around EUR [10-20] billion(1) that revealed significant uncertainties regarding adequacy in
provisioning(2):
(i) Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding
costs, realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a
maximum of EUR 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some
additional conditions(1)(2)(3);
(ii) Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount
necessary (but no more than EUR 400 million). The amount that can be reclaimed by the Resolution Fund
under the CCA is subject to the cap of EUR 3.89 billion(2);
(iii) In case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted
by the Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism
(capital backstop), up to EUR 1.6 billion, provided for in the commitments made by the Portuguese State to
ensure the viability of NB, exists\u201d.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the
General Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding
its approval of the CCA of Novo Banco.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has
disclosed that the European Commission intends to consider the restructuring process of Novo Banco as
completed. The information disclosed today confirms the successful restructuring of Novo Banco, resulting from
the combined execution of the restructuring plan agreed in 2017, under the sale transaction conducted by Banco
de Portugal, and the sale agreements, namely the CCA, under which the Resolution Fund transferred to Novo
Banco EUR 485 million, less than the maximum amount set in the contract (EUR 3,890 million). The completion
of the restructuring of Novo Banco, is also another indicator that Novo Banco should not need to request any
further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that still
may occur regarding the amounts already requested by Novo Banco in relation to past years and that the
Resolution Fund considers that are not due.\"
On the same day, Banco de Portugal issued the following statement \"The conclusion of the Novo Banco
restructuring process also results in the end of the backstop mechanism, which provided for the possibility, which
was always considered remote, of the Portuguese State providing extraordinary support to Novo Banco in
extreme scenarios. This mechanism protected Novo Banco and the national financial system from more adverse
scenarios, which did not materialise. With the end of the backstop, the financial risk for the Portuguese State is
eliminated\".
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or Tier 1 SREP
requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
On 9 December 2024, the Resolution Fund announced in a statement that it had signed an agreement ending
the Contingent Capitalisation Agreement (CCA) signed in 2017 as part of the Novo Banco sale. This agreement
brings forward by around a year the end of the CCM, which until now had been scheduled for the end of 2025,
definitively extinguishing any possibility of Novo Banco requesting further payments from the Resolution Fund.
The main terms and conditions of the agreement to bring forward the end of the MCC include:
- Immediate termination of the CCA, bringing forward the maturity of the contract, scheduled for the end of 2025,
which implies, in particular, that no new payment requests can be made by Novo Banco, that operations relating
to the assets covered by the Agreement no longer require the Resolution Fund's opinion, and that the Monitoring
Committee is also extinguished, and that the impediment to the distribution of dividends by Novo Banco, which
was stipulated in the MCC, ceases.
- The existing payment obligations between the parties as a result of the CCA, as well as all litigation and disputes
related to the implementation of the agreement, are settled - without any transfer of funds.
- The Resolution Fund's contingent liabilities associated with the alleged breach of the \u201cBusiness Warranties\u201d
assumed in the Novo Banco sale agreement are extinguished, namely with the waiver of the compensation claims
preliminarily presented by Nani Holdings, which amounted to around EUR 60 million.
- The mechanism whereby the stake in Novo Banco held by Nani Holdings is not diluted in the event of capital
increases because of the application and under the terms of the Special Regime Applicable to Deferred Tax Assets
is extinguished.
The agreement allows for a significant reduction in the Resolution Fund's liabilities (in excess of EUR 73 million in
net terms, based on the amounts claimed by Novo Banco), as well as allowing for the extinction of potentially
significant contingencies. Thus, all the Resolution Fund's obligations relating to the CCA are definitively closed. The
amount paid by the Resolution Fund was therefore EUR 485 million below the maximum amount provided for in
the contract (EUR 3,890 million) and EUR 936 million below the aggregate amount of losses \u201ccovered\u201d by the
contingent capitalisation mechanism (EUR 4,341 million, as at 30/06/2024).
With the expiry of the Contingent Capitalisation Agreement, the payments made by the Resolution Fund will be
limited to the EUR 3,405 million that the Resolution Fund considered to be due, between 2018 and 2021.
According to a statement issued by the Banco de Portugal on 9 December 2024 on the end of the contingent
capitalisation agreement signed in the context of the sale of Novo Banco, \u201cThe CCA and the management of the
assets that comprised it were subject to numerous internal and external audits, as provided for in the original
Agreement, carried out by independent entities hired for this purpose. To this was added the monitoring carried
out by the supervisory authorities and others with powers to do so within the legal framework in force, including
the European Central Bank and the Court of Auditors.\u201d
According to Novo Banco\u2019s 2025 first half Report (note 28), Novo Banco adhered to the Special Regime applicable
to Deferred Tax Assets under Law 61/2014, of 26 August (REAID), according to which, the deferred tax assets
recorded until 31 December 2015 can be converted into tax credits when the taxable entity reports an annual net
loss, in accordance to the proportion of the amount of the said net loss to total equity at the individual company
level, A special reserve was established with an amount identical to the tax credit approved, increased by 10%. The
conversion rights are securities that entitle the State to require Novo Banco to increase its share capital by
incorporating the amount of the special reserve and consequently issuing and delivering free of charge ordinary
shares. The shareholders have the right to acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2024 Annual Report, under the terms of the sale of Novo Banco, the Fund is
required to maintain Nani Holdings' stake at 75% when that stake is affected by capital increases carried out under
the terms of the REAID.
According to the Resolution Fund\u2019s 2024 Annual Report, under REAID, Novo Banco, S. A., carried out three capital
increases by incorporation of reserves, through the rights conversion that had been attributed to the State as a
result of the conversion, into tax credits, of Novo Banco's deferred tax assets with reference to the 2015 to 2019 tax
periods.
According to Novo Banco\u2019s 2025 first half Report, Novo Banco carried out another capital increase following the
conversion of the conversion rights granted by the State for the 2020 fiscal year, fully subscribed by the Resolution
Fund.
On 13 June 2025, it was announced that a Memorandum of Understanding had been signed between the Lone
Star funds and the BPCE Group for the sale of the 75% stake held by Lone Star in Novo Banco. The acquisition will
be carried out for an estimated amount of EUR 6.4 billion for 100% of Novo Banco\u2019s share capital and is expected to
be completed in early 2026. According to the Resolution Fund's statement dated 13 June 2025, the sale of its stake
as part of this transaction will result in a gross inflow of approximately EUR 866 million. This amount will be used to
repay the Resolution Fund\u2019s debt, particularly to the State.
On 29 October 2025, the Ministry of Finance and the Resolution Fund signed an agreement with BPCE Group and
Nani Holdings for the sale of minority stakes held in the institution (specifically, 11.5% by the Portuguese State and
13.5% by the Resolution Fund) under the same financial conditions.
Following the completion of the process, BPCE Group will become the sole shareholder of Novo Banco.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to
fail\u201d and started an urgent resolution process of the institution through the partial or total sale of its activity, which
was completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and
obligations of Banif, formed by the assets, liabilities, off-balance sheet items and assets under management. The
largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of EUR 746 million. The Resolution Fund
provided a guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of
which EUR 489 million were provided by the Resolution Fund, which was funded by a loan granted by the State.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal
dismissed a lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de
Portugal. In its decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
On 4 July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds
issued in connection with the resolution of BANIF. Oitante's debt, which initially totalled EUR 746 million, has
therefore been fully settled. With the repayment of the debt, the Resolution Fund's responsibility as guarantor also
ceases, as well as the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the
non-acknowledged creditors. According to the Resolution Fund\u2019s 2023 Annual Report, the Resolution Fund holds
a claim on Banif of EUR 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF.
Under the judicial liquidation process of Banif, which was initiated following the resolution, the independent
evaluator estimates that the level of recovery of the financial support made available by the Resolution Fund, as
having a higher ranking at the end of the liquidation, is expected to be 7.6%.
The Resolution Fund on 19 December 2025 informed that Oitante approved another dividend distribution to the
Resolution Fund by EUR 13.1 million. This is the second distribution to the Resolution Fund in 2025, following the
payment of a EUR 13.1 million dividend during the year. With this new distribution, the amount delivered by
Oitante to the Resolution Fund totals EUR 176.2 million since the company was set up. The amounts received and
to be received by the Resolution Fund, given its 100% participation in Oitante's capital, contribute to reducing the
losses of Euro 489 million incurred by this Fund in the resolution of BANIF and will be used to repay the debts of
the Resolution Fund.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and
assumed other responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2024, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (EUR 3,900 million); (ii) to finance the absorption of Banif's losses (EUR 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (EUR 430 million plus EUR 850 million of additional funding requested in 2019 and EUR
850 million made available in 2020);
- Other funding received:
\u2022 in 2014 by seven domestic institutions in the amount of EUR 700 million, in which the Bank participates,
within the scope of BES resolution measure;
\u2022 in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up
to a maximum of EUR 429 million;
- The underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of
EUR 400 million (did not take place as the instruments were placed with third party investors as disclosed by Novo
Banco on 29 July 2018);
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a
loss greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralised by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, S.A.;
- CCA that allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions
related to the aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star
up to EUR 3.89 billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1
below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
To meet a payment from the Resolution Fund to Novo Banco, as per to Resolution 63-A/2021 of 27 May 2021 of the
Council of Ministers and Order from the Minister of State and Finance, of 31 May 2021 - intended to provide the
Resolution Fund with the financial resources necessary to meet any obligations arising from the Contingent
Capitalisation Agreement in the years 2021 and 2022 \u2013 rendering a new loan from the State to the Resolution
Fund, a number of national financial institutions offered to finance the Resolution Fund, increasing up to EUR 475
million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund.
According to the Resolution Fund\u2019s 2024 Annual Report from the maximum amount of EUR 475 million. The
Resolution Fund used EUR 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period
between the contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be
reviewed on 31 December 2026 and, after that, every five-years. The payment obligations arising from this loan
benefit from a pari passu treatment with the payment obligations of the loans entered into with the Portuguese
State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on 28 August 2014. The
funding costs of the Resolution Fund (from the State and from banks) will continue to be exclusively borne by
periodic revenues, corresponding to the contributions paid by the banking sector.
According to note 27 of the Resolution Fund\u2019s 2024 Annual Report, the Resolution Fund considers that, to date,
there are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the EUR 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution
Fund, the extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet
its obligations through its regular revenues, regardless of the contingencies to which the Resolution Fund is
exposed. On the same day, the Office of the Minister of Finance also announced that increases in the liabilities
arising from the materialisation of future contingencies will determine the maturity adjustment of State and bank
loans to the Resolution Fund, required from to maintain the contributory effort required from the banking sector
at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco
Esp\u00edrito Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to
EUR 4,953 million, of which EUR 4,253 million were granted by the Portuguese State and EUR 700 million were
granted by a group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on
the use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and
financial balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on
regular revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and
released on 12 July 2022, \"the repayment of the EUR 2,130 million loans granted by the Portuguese State to the
Resolution Fund will not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or
in 2059 (with the use of the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid
in 2062\u201d.
On 2 October 2017, by Resolution 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to
make available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary,
to satisfy any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-
mentioned resolution further set out that the framework agreement should be subject to a time period that is
consistent with the undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to
satisfy said obligations in due time.
As at 31 December 2024, the Resolution Fund's own resources had a negative equity of EUR 6,475.8 million, as
opposed to EUR 6,735.1 million at the end of 2023, according to the latest 2024 Annual Report of the Resolution
Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives
proceeds from the initial and regular contributions from the participating institutions (including the Bank) and
from the contribution over the banking sector (created under Law 55-A/2010). It is also provided for the possibility
of the member of the Government responsible for the area of Finance to determine, by ordinance that the
participating institutions make special contributions, in the situations provided for in the applicable legislation,
particularly if the Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying,
since 2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the
occurrence of the event which creates the obligation to pay the contribution, i.e. on the last day of April of each
year, as stipulated in Article 9 of the referred Decree-Law 24/2013, of 19 February, thus the Bank is recognising as
an expense the contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 14/2025, published on 15 December 2025, set the base rate for 2026 for the
determination of periodic contributions to the Resolution Fund at 0.047% (0.049% in 2025).
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a
proposal with respect to the determination of amounts, time limits, payment methods, and any other terms
related to the special contributions to be made by the institutions participating in the Resolution Fund. According
to public communications from both the Resolution Fund and from the Government, there is no indication that
any such special contributions are foreseen.
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is
not expected that the Resolution Fund will propose the setting up of a special contribution to finance the
resolution measure applied to BES. Therefore, the potential collection of a special contribution appears to be
unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in
the amount of EUR 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to
partially cover for the disbursements made by the Resolution Fund in respect of resolution measures prior to the
date of application of this Agreement. This amount will have to be reinstated over a period of 8 years (started in
2016) through the periodic contributions to the SRF. The Single Resolution Fund does not cover undergoing
situations with the National Resolution Fund as at 31 December 2015. In 2024, no contribution was made to the
Single Resolution Fund attributable to the Group (BCP and ActivoBank) according to information from the SRB \u2013
Single Resolution Board of 10 February 2025, which states that the financial means available in the Single
Resolution Fund at 31 December 2024 remains above the target level of at least 1% of covered deposits held in the
Member States participating in the Single Resolution Mechanism, as set in article 69 (1) of Regulation (EU)
806/2014.
In 2025, the Group made regular contributions to the Portuguese Resolution Fund in the amount of EUR 10,166
thousand. The amount related to the contribution on the banking sector in Portugal, recorded in this period was
EUR 28,560 thousand. These contributions were recognised as a cost in the first half of 2025, in accordance with
IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, according to note 27 of the 2024 Resolution Fund\u2019s annual report to assess the
effects on the Resolution Fund due to: (i) the sale of the shareholding in Novo Banco in accordance with the
communication of Banco de Portugal dated 18 October 2017 and the information provided by the European
Commission on this subject under the terms described above; (ii) the application of the principle that no creditor
of the credit institution under resolution may take on a loss greater than the one it would take if that institution
did not go into liquidation; and (iii) legal proceedings against the Resolution Fund.
13. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution
adopted by Banco de Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation
adopted by the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent
capitalisation agreement under which the Resolution Fund commits to inject capital in Novo Banco up to EUR 3,9
billion, under determined circumstances. In the proceedings, the claimants request the declaration of nullity or
annulment of those acts.
The proceedings were filed based on the information contained in the Communication from Banco de Portugal
dated 31 March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September
2017. Banco de Portugal and the Resolution Fund presented their arguments and, only very recently, Nani
Holdings SGPS, S.A. did the same since, by delay of the court, this company was only very recently notified to act as
a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Banco de Portugal cannot be challenged and (iii) the material incompetence
of the court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an
opponent party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the
opponent party. After the presentation of the arguments, Banco de Portugal attached to the proceedings what it
called an evidence process (allegedly in compliance with the law) but most of the documents delivered were
truncated in such a way that neither the court nor the claimants are able to obtain adequate knowledge thereof.
That issue was already raised in the proceedings (requesting the court to order Banco de Portugal to deliver a true
evidence process) but no decision thereon has been made yet.
The proceeding was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal
opinions to the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
On 31 December 2025, the proceedings are prepared for confirmation of the decision accepting the formalities of
the right of action (with the making of a decision on the specific objections invoked). In case the judge considers
that Novo Banco is an opponent party, the judge must start by issuing a pre-confirmation in order to request the
claimants to identify it. Afterwards, that Bank will be notified to present its opposition arguments.
On 31 December 2025, the proceedings have not progressed and are still before the judge (for a possible decision
on the reorganisation of the case).
By application dated 7 January 2026, the Bank took advantage of the Court's invitation to rule on the updating of
the data of the Counterparty Nani Holdings, SGPS, S.A., to submit a set of supervening documents to the case-files
and request the continuation of the proceedings.
Since the case has not undergone any developments since the end of the written proceedings (in 2018), it is not
possible to have a non-speculative expectation of its development or timetable for its conclusion, and it is not
anticipated that the agreement for the sale of NB will influence this timetable.
14. The Bank was subject to tax inspections for the years up to 2022. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the
case of indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of
determining the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/
corrections made by the tax administration were the object of contestation by administrative and/or judicial
means.
The Bank recorded provisions, current tax liabilities or deferred tax liabilities at the amount considered sufficient to
offset the tax or tax loss carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by
the tax administration.
15. Bank Millennium is a party to proceedings initiated by the President of UOKiK regarding the recognition of
certain provisions of a contract template as abusive. The proceedings concern modification clauses indicating the
circumstances in which the Bank is entitled to amend the terms and conditions and the fees and commissions
price lists. According to UOKiK, these clauses grant the Bank unlimited discretion in shaping the content of the
contract, which may violate good practice and grossly infringe the interests of consumers. The Bank challenged
the validity of these allegations, indicating that the provisions are precise and clearly define the conditions for their
application. The President of UOKiK extended the proceedings until 25 June 2026.
Bank Millennium is also a party to proceedings initiated by the President of UOKiK regarding the modification
clauses used by Euro Bank S.A., for which Bank Millennium S.A. is the legal successor. The President of UOKiK
extended these proceedings until 31 August 2026.
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherProvisionsContingentLiabilitiesAndContingentAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-668": { "value": "Share of profit of associates accounted for using the equity method
The main contributions of the investments accounted for using the equity method are analysed as follows:
(Thousands of euros)
2025
2024
Banco Millennium Atl\u00e2ntico, S.A. (note 26)
Appropriation of net income relating to the current year
4,954
4,101
Effect of the application of IAS 29:
Amortisation of the effect calculated until 31 December 2018 (a)
(104)
(182)
4,850
3,919
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
36,144
28,360
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
7,709
5,373
SIBS, S.G.P.S, S.A.
13,709
15,385
Banque BCP, S.A.S.
3,266
2,995
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
1,550
1,546
Other companies
(5,045)
1,310
57,333
54,969
62,183
58,888
(a) Based on the requirements of IAS 29, Angola was considered as a hyperinflationary economy until 31 December 2018, for the purposes of
presentation of consolidated financial statements, as described in accounting policy 1 B6. This classification is no longer applied since 1 January 2019.
Investments in associates
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Portuguese credit institutions
54,910
50,153
Foreign credit institutions
124,181
128,829
Other Portuguese companies
277,542
253,146
Other foreign companies
40,684
42,746
497,317
474,874
Impairment
(42,141)
(45,451)
455,176
429,423
The balance Investments in associates, as at 31\u00a0December 2025, is analysed as follows:
(Thousands of euros)
2025
Global value of
investment
Impairment of
investments in
associates
Book value of
investment
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
127,932
\u2014
127,932
Banco Millennium Atl\u00e2ntico, S.A.
70,488
(24,130)
46,358
Banque BCP, S.A.S.
53,693
\u2014
53,693
SIBS, S.G.P.S, S.A.
84,639
\u2014
84,639
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
54,910
\u2014
54,910
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
13,184
\u2014
13,184
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in
liquidation)
16,273
\u2014
16,273
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo
(in liquidation)
1,737
\u2014
1,737
Fundo Turismo Algarve FCR
42,037
\u2014
42,037
Europa Millennium Financial Services Sp. z o.o.
9,155
\u2014
9,155
Nexponor - Sociedade de Investimento Coletivo Imobili\u00e1rio
Fechado, S.A. (in liquidation)
4,924
\u2014
4,924
TIICC S.A.R.L.
334
\u2014
334
Webspectator Corporation
18,011
(18,011)
\u2014
497,317
(42,141)
455,176
These investments refer to entities whose shares are not listed on the stock exchange. According to the
accounting policy described in note 1 B, these investments are measured at the equity method.
The balance Investments in associates, as at 31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
Global value of
investment
Impairment of
investments in
associates
Book value of
investment
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
106,675
\u2014
106,675
Banco Millennium Atl\u00e2ntico, S.A.
74,882
(27,440)
47,442
Banque BCP, S.A.S.
53,947
\u2014
53,947
SIBS, S.G.P.S, S.A.
74,795
\u2014
74,795
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
50,153
\u2014
50,153
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
14,371
\u2014
14,371
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in
liquidation)
19,175
\u2014
19,175
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo
(in liquidation)
4,305
\u2014
4,305
Fundo Turismo Algarve FCR
41,045
\u2014
41,045
Europa Millennium Financial Services Sp. z o.o.
10,291
\u2014
10,291
Nexponor - Sociedade de Investimento Coletivo Imobili\u00e1rio
Fechado, S.A. (in liquidation)
7,151
\u2014
7,151
TIICC S.A.R.L.
73
\u2014
73
Webspectator Corporation
18,011
(18,011)
\u2014
474,874
(45,451)
429,423
The Group's companies included in the consolidation scope are presented in note 60, as well as the main
indicators of the most relevant ones.
The movements occurred in Impairment of investments in associates are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
45,451
46,355
Exchange rate differences
(3,310)
(904)
Balance at the end of the year
42,141
45,451
In accordance with the requirements of IFRS 12 and considering their relevance, the movements occurred in the
investment held in Banco Millennium Atl\u00e2ntico, S.A., is analysed as follows:
(Thousands of euros)
2025
2024
Ownership held by BCP on equity of the associate as at 1 January
47,442
47,086
Application of IAS 29 for the year:
Net non-monetary assets of the BMA
Effect of exchange rate variations (note 44)
(525)
(150)
Amortisation of the effect of IAS 29 application calculated as at 31 December 2018 (note
15)
(104)
(182)
Goodwill of investment in BMA
Effect of exchange rate variations (note 44)
(1,368)
(373)
Appropriation of the net income of the associates (note 15)
4,954
4,101
Other comprehensive income attributable to BCP
(182)
(2,167)
Exchange rate differences
Effect on BMA's equity
(5,555)
(1,323)
Goodwill of the investment in BMA
(1,664)
(454)
Impairment of investments in associates (note 44)
3,310
904
Other
50
\u2014
Investment held at the end of the year
46,358
47,442
The following table presents the financial statements of Banco Millennium Atl\u00e2ntico, S.A, prepared in accordance
with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2025
2024
Net income for the year
21,793
18,041
Other comprehensive income
(802)
(9,532)
Total comprehensive income attributable to Shareholders of the associate
20,991
8,509
Application of IAS 29 (*)
(459)
(802)
Attributable to Shareholders of the associates adjusted to BCP GAAP
20,532
7,707
Attributable to the BCP Group
4,668
1,752
Balance sheet
Financial assets
1,875,455
1,797,788
Non-financial assets
246,062
250,391
Financial liabilities
(1,903,127)
(1,824,397)
Non-financial liabilities
(22,068)
(24,236)
Equity attributable to Shareholders of the associates
196,322
199,546
Application of IAS 29 (*)
16,535
19,301
Equity attributable to Shareholders of the associates adjusted to BCP GAAP
212,857
218,847
Equity attributable to the BCP Group
48,392
49,754
Goodwill of the merge
22,096
25,128
Impairment of investments in associates
(24,130)
(27,440)
Equity attributable to the BCP Group adjusted of consolidation items
46,358
47,442
(*) The impact of the IAS 29 adoption was calculated from the date of the merger (April 2016).
The amounts presented do not include adjustments arising from the application of IAS 29. Based on the
requirements of IAS 29, Angola was considered a hyperinflationary economy until 31 December 2018, for the
purpose of presenting the consolidated financial statements, as described in accounting policy 1 B6. This
classification ceased to be applied on 1 January 2019.
In accordance with the requirements of IFRS 12 and considering their relevance, the movements occurred in the
investment held in Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., is analysed as follows:
(Thousands of euros)
2025
2024
Appropriation of equity of the associate on 1 January
106,675
105,675
Appropriation of net income for the year of associates (note 15)
36,144
28,360
Other comprehensive income attributable to BCP
16,473
13,009
Dividends received
(31,360)
(40,369)
Investment held at the end of the year
127,932
106,675
The following table presents the financial statements of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.,
prepared in accordance with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2025
2024
Net income for the year
73,764
61,462
Correction of net income from previous years
\u2014
(3,584)
Other comprehensive income
33,618
26,549
Total comprehensive income attributable to Shareholders of the associate
107,382
84,427
Total comprehensive income attributable to the BCP Group (49%)
52,617
41,369
Balance sheet
Financial assets
8,395,817
7,856,087
Non-financial assets
373,108
435,735
Financial liabilities
(4,165,001)
(4,172,992)
Non-financial liabilities
(4,079,688)
(3,638,209)
Total equity
524,236
480,621
Equity attributable to non-controlling interests
10,663
10,430
Equity attributable to Shareholders of the associates
513,573
470,191
Adjustments of intra-group transactions (*)
378,415
378,415
Equity attributable to Shareholders of the associate adjusted to BCP GAAP
891,988
848,606
Equity attributable to the BCP Group (49%)
437,074
415,817
Reversal of the initial gain in 2004 allocated to the BCP Group
(309,142)
(309,142)
Equity attributable to the BCP Group adjusted of consolidation items
127,932
106,675
(*) Adjustment related to the cancellation in the BCP Group consolidated accounts of the VOBA recorded by Millenniumbcp Ageas Grupo Segurador,
S.G.P.S, S.A., upon initial registration of this investment. VOBA corresponds to the estimated current value of the future cash flows of the contracts in
force at the date of acquisition under IFRS 4. With the implementation of IFRS 17, this concept was cancelled in the consolidated accounts of
Millenniumbcp Ageas having no impact on the Group 's consolidated accounts as it is not recognised in the investment.
The balances with associates included in the consolidated balance sheet items, except for the item investments in
associates, are as follows:
(Thousands of euros)
2025
2024
Assets
Loans and advances to credit institutions repayable on demand
5,337
8,328
Financial assets at amortised cost
Loans and advances to credit institutions
220,232
225,644
Loans and advances to customers
59,169
59,454
Other assets
18,461
18,208
303,199
311,634
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
10,822
39,568
Deposits from customers and other funds
118,653
150,317
Non-subordinated debt securities issued
\u2014
3,562
Other liabilities
614
626
130,089
194,073
The transactions with associates included in the consolidated income statement items are as follows:
(Thousands of euros)
2025
2024
Income
Interest and similar income
11,134
14,001
Commissions
75,491
67,481
Gains on financial operations
\u2014
16
Other operating income
3,445
3,776
90,070
85,274
Costs
Interest and similar expense
2,046
1,837
Commissions
3,583
3,893
Other administrative costs
2,321
4,182
Losses on financial operations
\u2014
878
7,950
10,790
The guarantees granted and revocable and irrevocable credit facilities by the Group over associates are as follows:
(Thousands of euros)
2025
2024
Guarantees granted
2,655
2,633
Revocable credit facilities
17,309
17,050
Irrevocable credit facilities
1,354
\u2014
21,318
19,683
List of subsidiaries and associates of Banco Comercial Portugu\u00eas Group
SUBSIDIARIES
As at 31\u00a0December 2025, the Group's subsidiaries included in the consolidated accounts using the full
consolidation method were as follows:
Group
Bank
Subsidiaries
Head
office
Share
capital
Currency
Sector of activity
% economic
interests
% effective
held
% direct
held
Banco ActivoBank, S.A.
Lisbon
217,600,000
EUR
Banking
100%
100%
100%
Bank Millennium, S.A.
Warsaw
1,213,116,777
PLN
Banking
50.1%
50.1%
50.1%
Millennium Bank Hipoteczny S.A.
Warsaw
163,000,000
PLN
Banking
100%
50.1%
\u2014
BCP \u00c1frica, S.G.P.S., Lda.
Funchal
214,223,800
EUR
Holding company
100%
100%
100%
BIM - Banco Internacional de
Mo\u00e7ambique, S.A.
Maputo
4,500,000,000
MZN
Banking
66.7%
66.7%
\u2014
Millennium bcp Participa\u00e7\u00f5es,
S.G.P.S., Sociedade Unipessoal,
Lda.
Funchal
25,000
EUR
Holding company
100%
100%
100%
Interfundos - Sociedade Gestora
de Organismos de Investimento
Coletivo, S.A.
Oeiras
1,500,000
EUR
Real estate
investment fund
management
100%
100%
100%
Monumental Residence -
Sociedade de investimento
coletivo imobili\u00e1ria fechada, S.A.
Oeiras
31,900,000
EUR
Real-estate
management
100%
100%
100%
Millennium bcp - Presta\u00e7\u00e3o de
Servi\u00e7os, A.C.E.
Lisbon
331,750
EUR
Services
98.6%
97.7%
93.2%
Millennium bcp Teleservi\u00e7os -
Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico,
S.A.
Lisbon
50,004
EUR
E-commerce
100%
100%
100%
Imoserit, S.A.
Oeiras
50,000
EUR
Real-estate
company
100%
100%
100%
Bichorro \u2013 Empreendimentos
Tur\u00edsticos e Imobili\u00e1rios S.A.
Oeiras
2,150,000
EUR
Real-estate
management
100%
100%
\u2014
Finalgarve \u2013 Sociedade de
Promo\u00e7\u00e3o Imobili\u00e1ria Tur\u00edstica,
S.A.
Oeiras
250,000
EUR
Real-estate
management
100%
100%
\u2014
Fiparso \u2013 Sociedade Imobili\u00e1ria S.A
Oeiras
50,000
EUR
Real-estate
company
100%
100%
\u2014
Millennium Consulting S.A.
Warsaw
4,339,500
PLN
Consulting
services
100%
50.1%
\u2014
Millennium Goodie Sp.z.o.o.
Warsaw
500,000
PLN
Web portals
100%
50.1%
\u2014
Millennium Leasing, Sp.z o.o.
Warsaw
48,195,000
PLN
Leasing
100%
50.1%
\u2014
Millennium Service, Sp.z o.o.
Warsaw
1,000,000
PLN
Services
100%
50.1%
\u2014
Millennium Telecommunication
Services Sp. z o.o.
Warsaw
100,000
PLN
Brokerage services
100%
50.1%
\u2014
Millennium TFI - Towarzystwo
Funduszy Inwestycyjnych, S.A.
Warsaw
10,300,000
PLN
Investment fund
management
100%
50.1%
\u2014
In 2025, the Group liquidated the subsidiaries BCP International B.V., Piast Expert Sp. z o.o. and M Representa\u00e7\u00f5es
Ltda.
As at 31\u00a0December 2025, the investment funds included in the consolidated accounts using the full consolidation
method, were as follows:
Group
Bank
Investment funds
Head
office
Share
capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Imosotto acumula\u00e7\u00e3o \u2013 Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
96,385,157
EUR
Real-estate
investment fund
100%
100%
100%
Imorenda \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
85,156,715
EUR
Real-estate
investment fund
100%
100%
100%
Sand Capital - Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
88,882,695
EUR
Real-estate
investment fund
100%
100%
100%
Fundial \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
17,340,985
EUR
Real-estate
investment fund
100%
100%
100%
Fundipar \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
1,546,726
EUR
Real-estate
investment fund
100%
100%
100%
Domus Capital\u2013 Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
3,799,969
EUR
Real-estate
investment fund
95.8%
95.8%
95.8%
Predicapital \u2013 Fundo de
Investimento Imobili\u00e1rio Fechado (*)
Oeiras
89,501,441
EUR
Real-estate
investment fund
60%
60%
60%
(*) - Company classified as non-current assets held for sale.
The Group holds a securitisation transaction regarding mortgage loans which was set through specifically created
SPE. As referred in accounting policy 1 B, when the substance of the relationships with the SPEs indicates that the
Group holds control of its activities, the SPE is fully consolidated, following the application of IFRS 10.
As at 31\u00a0December 2025, the Special Purpose Entity included in the consolidated accounts under the full
consolidation method is as follows:
Group
Bank
Special Purpose Entities
Head
office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Magellan Mortgages No.3 Limited
Dublin
40,000
EUR
Special Purpose
Entities
82.4%
82.4%
82.4%
ASSOCIATES
As at 31\u00a0December 2025, the Group's associates included in the consolidated accounts under the equity method
are as follows:
Group
Bank
Associates
Head office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Banco Millennium Atl\u00e2ntico, S.A.
Luanda
53,821,603,000
AOA
Banking
22.7%
22.5%
\u2014
Banque BCP, S.A.S.
Paris
215,892,336
EUR
Banking
18.9%
18.9%
18.9%
Lubuskie Fabryki Mebli, S.A. (in
liquidation)
Swiebodzin
524,552
PLN
Furniture
manufacturer
50%
25.1%
\u2014
Europa Millennium Financial
Services sp. z o.o.
Warsaw
100,000
PLN
Services
20%
10%
\u2014
SIBS, S.G.P.S., S.A.
Lisbon
24,642,300
EUR
Banking services
23.3%
21.9%
\u2014
UNICRE - Institui\u00e7\u00e3o Financeira
de Cr\u00e9dito, S.A.
Lisbon
10,000,000
EUR
Credit cards
32%
32%
0.5%
Webspectator Corporation
Delaware
950
USD
Digital
advertising
services
25.1%
25.1%
25.1%
TIICC S.A.R.L.
Luxembourg
13,000
EUR
Services
38.5%
38.5%
38.5%
Nexponor -\u00a0 Sociedade de
Investimento Coletivo
Imobili\u00e1rio Fechado, S.A. (in
liquidation)
Lisbon
65,621,200
EUR
Real-estate
management
20.7%
20.7%
20.7%
As at 31\u00a0December 2025 , the investment and venture capital funds included in the consolidated accounts under
the equity method are as follows:
Group
Bank
Investment and venture capital
funds
Head
office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Fundo Turismo Algarve, FCR (*)
Lisbon
124,160,000
EUR
Venture capital
fund
73.6%
73.6%
73.6%
Fundo de Investimento imobili\u00e1rio
fechado Eurofundo (in liquidation)
Lisbon
5,120,400
EUR
Real-estate
investment fund
35.1%
35.1%
35.1%
Lusofundo - Fundo de
Investimento imobili\u00e1rio fechado
(in liquidation)
Lisbon
34,518,110
EUR
Real-estate
investment fund
42.5%
42.5%
42.5%
(*) Since Banco Comercial Portugu\u00eas, SA does not have control over the management of this fund, the equity method was applied in the Group 's
consolidated accounts.
As at 31\u00a0December 2025, the Group's associates in the insurance sector included in the consolidated accounts
under the equity method were as follows:
Group
Bank
Associates
Head
office
Share
capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Millenniumbcp Ageas Grupo
Segurador, S.G.P.S., S.A.
Lisbon
50,002,375
EUR
Holding
company
49%
49%
49%
Ocidental - Companhia Portuguesa
de Seguros de Vida, S.A.
Lisbon
22,375,000
EUR
Life insurance
49%
49%
\u2014
Ageas - Sociedade Gestora de
Fundos de Pens\u00f5es, S.A.
Lisbon
1,200,000
EUR
Pension fund
management
49%
49%
\u2014
Fidelidade Mo\u00e7ambique -
Companhia de Seguros S.A.
Maputo
295,000,000
MZN
Insurance
22%
14.7%
\u2014
Some indicators of the main subsidiaries and associates are analysed as follows:
(Thousands of euros)
2025
2024
Subsidiaries and associates
Total
Assets
Total
Equity
Net
income for
the year
Total
Assets
Total
Equity
Net
income for
the year
Banco Comercial Portugu\u00eas, S.A.
68,304,616
7,245,129
814,652
63,960,815
6,736,196
802,567
Banco ActivoBank, S.A.
5,251,220
423,682
43,413
4,483,473
288,116
34,021
Bank Millennium, S.A. (1)
36,949,277
2,161,034
283,704
32,574,358
1,817,203
167,071
BIM - Banco Internacional de Mo\u00e7ambique,
S.A. (1)
2,689,632
473,615
3,386
3,077,065
537,544
48,469
BCP International B.V.
\u2014
\u2014
(15)
195
177
(733)
BCP Finance Bank, Ltd.
\u2014
\u2014
\u2014
\u2014
\u2014
(536)
BCP \u00c1frica, S.G.P.S., Lda.
288,383
288,366
10,494
286,839
285,710
8,251
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S.,
Sociedade Unipessoal, Lda.
174,701
174,689
(8,421)
188,122
188,110
46,219
Interfundos - Sociedade Gestora de
Organismos de Investimento Coletivo, S.A.
8,017
6,740
594
8,041
6,597
760
Millenniumbcp Ageas Grupo Segurador,
S.G.P.S., S.A. (1)
8,768,925
524,236
73,764
8,291,822
480,621
61,462
Banco Millennium Atl\u00e2ntico, S.A. (2)
2,121,517
196,322
21,793
2,048,179
199,546
18,041
Banque BCP, S.A.S.
5,990,461
283,815
17,267
5,913,938
284,890
15,815
1) Consolidated accounts.
2) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInAssociatesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-667": { "value": "Share of profit of associates accounted for using the equity method
The main contributions of the investments accounted for using the equity method are analysed as follows:
(Thousands of euros)
2025
2024
Banco Millennium Atl\u00e2ntico, S.A. (note 26)
Appropriation of net income relating to the current year
4,954
4,101
Effect of the application of IAS 29:
Amortisation of the effect calculated until 31 December 2018 (a)
(104)
(182)
4,850
3,919
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
36,144
28,360
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
7,709
5,373
SIBS, S.G.P.S, S.A.
13,709
15,385
Banque BCP, S.A.S.
3,266
2,995
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
1,550
1,546
Other companies
(5,045)
1,310
57,333
54,969
62,183
58,888
(a) Based on the requirements of IAS 29, Angola was considered as a hyperinflationary economy until 31 December 2018, for the purposes of
presentation of consolidated financial statements, as described in accounting policy 1 B6. This classification is no longer applied since 1 January 2019.", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-670": { "value": "
This balance is comprised of:
(Thousands of euros)
2025
2024
Gains/(Losses) on disposal of investments
17,881
(58)
Gains/(Losses) on disposal of other assets
19,051
22,701
36,932
22,643
The balance Gains/(losses) on disposal of investments includes an amount of EUR 15,213,000 relating to a price
adjustment relating to the sale process of an investment that took place in 2017.
The balance Gains/(Losses) on disposal of other assets essentially include the result deducted from intermediation
costs from the sale of assets held by the Group and classified as non-current assets held for sale and as other
assets, which corresponds to a gain of EUR 7,893,000 (2024: gain of EUR 16,473,000).
The following table presents a summary of financial information for the main subsidiaries included in this balance,
prepared in accordance with IFRS. The information is presented before inter-company eliminations:
(Thousands of euros)
Bank Millennium Group
BIM - Banco International
de Mo\u00e7ambique Group
2025
2024
2025
2024
Net income for the year
283,704
167,071
3,386
48,469
Net income attributable to shareholders
142,136
83,703
2,258
32,322
Net income attributable to non-controlling interests
141,568
83,368
1,128
16,147
Other comprehensive income attributable to shareholders
40,741
31,463
(44,890)
27,085
Other comprehensive income attributable to non-controlling
interests
40,578
31,336
(22,426)
13,548
Total comprehensive income
365,023
229,870
(63,930)
89,102
Balance sheet
Financial assets
36,041,258
31,723,336
2,503,801
2,866,807
Non-financial assets
908,019
851,022
185,831
210,258
Financial liabilities
(33,327,715)
(29,494,494)
(2,148,273)
(2,450,663)
Non-financial liabilities
(1,460,528)
(1,262,661)
(67,745)
(88,858)
Equity:
2,161,034
1,817,203
473,614
537,544
attributable to shareholders
1,082,730
910,446
315,832
358,464
attributable to non-controlling interests
1,078,304
906,757
157,782
179,080
Cash flows arising from:
operating activities
3,226,769
2,497,437
6,074
139,827
investing activities
(3,248,321)
(3,229,668)
(22,936)
(22,366)
financing activities
194,596
417,754
(4,401)
(96,770)
Increase / (decrease) in cash and cash equivalents
173,044
(314,477)
(21,263)
20,691
Dividends paid during the year:
attributable to shareholders
\u2014
\u2014
\u2014
57,503
attributable to non-controlling interests
\u2014
\u2014
\u2014
28,727
\u2014
\u2014
\u2014
86,230
List of subsidiaries and associates of Banco Comercial Portugu\u00eas Group
SUBSIDIARIES
As at 31\u00a0December 2025, the Group's subsidiaries included in the consolidated accounts using the full
consolidation method were as follows:
Group
Bank
Subsidiaries
Head
office
Share
capital
Currency
Sector of activity
% economic
interests
% effective
held
% direct
held
Banco ActivoBank, S.A.
Lisbon
217,600,000
EUR
Banking
100%
100%
100%
Bank Millennium, S.A.
Warsaw
1,213,116,777
PLN
Banking
50.1%
50.1%
50.1%
Millennium Bank Hipoteczny S.A.
Warsaw
163,000,000
PLN
Banking
100%
50.1%
\u2014
BCP \u00c1frica, S.G.P.S., Lda.
Funchal
214,223,800
EUR
Holding company
100%
100%
100%
BIM - Banco Internacional de
Mo\u00e7ambique, S.A.
Maputo
4,500,000,000
MZN
Banking
66.7%
66.7%
\u2014
Millennium bcp Participa\u00e7\u00f5es,
S.G.P.S., Sociedade Unipessoal,
Lda.
Funchal
25,000
EUR
Holding company
100%
100%
100%
Interfundos - Sociedade Gestora
de Organismos de Investimento
Coletivo, S.A.
Oeiras
1,500,000
EUR
Real estate
investment fund
management
100%
100%
100%
Monumental Residence -
Sociedade de investimento
coletivo imobili\u00e1ria fechada, S.A.
Oeiras
31,900,000
EUR
Real-estate
management
100%
100%
100%
Millennium bcp - Presta\u00e7\u00e3o de
Servi\u00e7os, A.C.E.
Lisbon
331,750
EUR
Services
98.6%
97.7%
93.2%
Millennium bcp Teleservi\u00e7os -
Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico,
S.A.
Lisbon
50,004
EUR
E-commerce
100%
100%
100%
Imoserit, S.A.
Oeiras
50,000
EUR
Real-estate
company
100%
100%
100%
Bichorro \u2013 Empreendimentos
Tur\u00edsticos e Imobili\u00e1rios S.A.
Oeiras
2,150,000
EUR
Real-estate
management
100%
100%
\u2014
Finalgarve \u2013 Sociedade de
Promo\u00e7\u00e3o Imobili\u00e1ria Tur\u00edstica,
S.A.
Oeiras
250,000
EUR
Real-estate
management
100%
100%
\u2014
Fiparso \u2013 Sociedade Imobili\u00e1ria S.A
Oeiras
50,000
EUR
Real-estate
company
100%
100%
\u2014
Millennium Consulting S.A.
Warsaw
4,339,500
PLN
Consulting
services
100%
50.1%
\u2014
Millennium Goodie Sp.z.o.o.
Warsaw
500,000
PLN
Web portals
100%
50.1%
\u2014
Millennium Leasing, Sp.z o.o.
Warsaw
48,195,000
PLN
Leasing
100%
50.1%
\u2014
Millennium Service, Sp.z o.o.
Warsaw
1,000,000
PLN
Services
100%
50.1%
\u2014
Millennium Telecommunication
Services Sp. z o.o.
Warsaw
100,000
PLN
Brokerage services
100%
50.1%
\u2014
Millennium TFI - Towarzystwo
Funduszy Inwestycyjnych, S.A.
Warsaw
10,300,000
PLN
Investment fund
management
100%
50.1%
\u2014
In 2025, the Group liquidated the subsidiaries BCP International B.V., Piast Expert Sp. z o.o. and M Representa\u00e7\u00f5es
Ltda.
As at 31\u00a0December 2025, the investment funds included in the consolidated accounts using the full consolidation
method, were as follows:
Group
Bank
Investment funds
Head
office
Share
capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Imosotto acumula\u00e7\u00e3o \u2013 Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
96,385,157
EUR
Real-estate
investment fund
100%
100%
100%
Imorenda \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
85,156,715
EUR
Real-estate
investment fund
100%
100%
100%
Sand Capital - Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
88,882,695
EUR
Real-estate
investment fund
100%
100%
100%
Fundial \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
17,340,985
EUR
Real-estate
investment fund
100%
100%
100%
Fundipar \u2013 Fundo de Investimento
Imobili\u00e1rio Fechado
Oeiras
1,546,726
EUR
Real-estate
investment fund
100%
100%
100%
Domus Capital\u2013 Fundo de
Investimento Imobili\u00e1rio Fechado
Oeiras
3,799,969
EUR
Real-estate
investment fund
95.8%
95.8%
95.8%
Predicapital \u2013 Fundo de
Investimento Imobili\u00e1rio Fechado (*)
Oeiras
89,501,441
EUR
Real-estate
investment fund
60%
60%
60%
(*) - Company classified as non-current assets held for sale.
The Group holds a securitisation transaction regarding mortgage loans which was set through specifically created
SPE. As referred in accounting policy 1 B, when the substance of the relationships with the SPEs indicates that the
Group holds control of its activities, the SPE is fully consolidated, following the application of IFRS 10.
As at 31\u00a0December 2025, the Special Purpose Entity included in the consolidated accounts under the full
consolidation method is as follows:
Group
Bank
Special Purpose Entities
Head
office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Magellan Mortgages No.3 Limited
Dublin
40,000
EUR
Special Purpose
Entities
82.4%
82.4%
82.4%
ASSOCIATES
As at 31\u00a0December 2025, the Group's associates included in the consolidated accounts under the equity method
are as follows:
Group
Bank
Associates
Head office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Banco Millennium Atl\u00e2ntico, S.A.
Luanda
53,821,603,000
AOA
Banking
22.7%
22.5%
\u2014
Banque BCP, S.A.S.
Paris
215,892,336
EUR
Banking
18.9%
18.9%
18.9%
Lubuskie Fabryki Mebli, S.A. (in
liquidation)
Swiebodzin
524,552
PLN
Furniture
manufacturer
50%
25.1%
\u2014
Europa Millennium Financial
Services sp. z o.o.
Warsaw
100,000
PLN
Services
20%
10%
\u2014
SIBS, S.G.P.S., S.A.
Lisbon
24,642,300
EUR
Banking services
23.3%
21.9%
\u2014
UNICRE - Institui\u00e7\u00e3o Financeira
de Cr\u00e9dito, S.A.
Lisbon
10,000,000
EUR
Credit cards
32%
32%
0.5%
Webspectator Corporation
Delaware
950
USD
Digital
advertising
services
25.1%
25.1%
25.1%
TIICC S.A.R.L.
Luxembourg
13,000
EUR
Services
38.5%
38.5%
38.5%
Nexponor -\u00a0 Sociedade de
Investimento Coletivo
Imobili\u00e1rio Fechado, S.A. (in
liquidation)
Lisbon
65,621,200
EUR
Real-estate
management
20.7%
20.7%
20.7%
As at 31\u00a0December 2025 , the investment and venture capital funds included in the consolidated accounts under
the equity method are as follows:
Group
Bank
Investment and venture capital
funds
Head
office
Share capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Fundo Turismo Algarve, FCR (*)
Lisbon
124,160,000
EUR
Venture capital
fund
73.6%
73.6%
73.6%
Fundo de Investimento imobili\u00e1rio
fechado Eurofundo (in liquidation)
Lisbon
5,120,400
EUR
Real-estate
investment fund
35.1%
35.1%
35.1%
Lusofundo - Fundo de
Investimento imobili\u00e1rio fechado
(in liquidation)
Lisbon
34,518,110
EUR
Real-estate
investment fund
42.5%
42.5%
42.5%
(*) Since Banco Comercial Portugu\u00eas, SA does not have control over the management of this fund, the equity method was applied in the Group 's
consolidated accounts.
As at 31\u00a0December 2025, the Group's associates in the insurance sector included in the consolidated accounts
under the equity method were as follows:
Group
Bank
Associates
Head
office
Share
capital
Currency
Activity
% economic
interests
% effective
held
% direct
held
Millenniumbcp Ageas Grupo
Segurador, S.G.P.S., S.A.
Lisbon
50,002,375
EUR
Holding
company
49%
49%
49%
Ocidental - Companhia Portuguesa
de Seguros de Vida, S.A.
Lisbon
22,375,000
EUR
Life insurance
49%
49%
\u2014
Ageas - Sociedade Gestora de
Fundos de Pens\u00f5es, S.A.
Lisbon
1,200,000
EUR
Pension fund
management
49%
49%
\u2014
Fidelidade Mo\u00e7ambique -
Companhia de Seguros S.A.
Maputo
295,000,000
MZN
Insurance
22%
14.7%
\u2014
Some indicators of the main subsidiaries and associates are analysed as follows:
(Thousands of euros)
2025
2024
Subsidiaries and associates
Total
Assets
Total
Equity
Net
income for
the year
Total
Assets
Total
Equity
Net
income for
the year
Banco Comercial Portugu\u00eas, S.A.
68,304,616
7,245,129
814,652
63,960,815
6,736,196
802,567
Banco ActivoBank, S.A.
5,251,220
423,682
43,413
4,483,473
288,116
34,021
Bank Millennium, S.A. (1)
36,949,277
2,161,034
283,704
32,574,358
1,817,203
167,071
BIM - Banco Internacional de Mo\u00e7ambique,
S.A. (1)
2,689,632
473,615
3,386
3,077,065
537,544
48,469
BCP International B.V.
\u2014
\u2014
(15)
195
177
(733)
BCP Finance Bank, Ltd.
\u2014
\u2014
\u2014
\u2014
\u2014
(536)
BCP \u00c1frica, S.G.P.S., Lda.
288,383
288,366
10,494
286,839
285,710
8,251
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S.,
Sociedade Unipessoal, Lda.
174,701
174,689
(8,421)
188,122
188,110
46,219
Interfundos - Sociedade Gestora de
Organismos de Investimento Coletivo, S.A.
8,017
6,740
594
8,041
6,597
760
Millenniumbcp Ageas Grupo Segurador,
S.G.P.S., S.A. (1)
8,768,925
524,236
73,764
8,291,822
480,621
61,462
Banco Millennium Atl\u00e2ntico, S.A. (2)
2,121,517
196,322
21,793
2,048,179
199,546
18,041
Banque BCP, S.A.S.
5,990,461
283,815
17,267
5,913,938
284,890
15,815
1) Consolidated accounts.
2) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInSubsidiariesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-669": { "value": "
This balance is comprised of:
(Thousands of euros)
2025
2024
Gains/(Losses) on disposal of investments
17,881
(58)
Gains/(Losses) on disposal of other assets
19,051
22,701
36,932
22,643
The balance Gains/(losses) on disposal of investments includes an amount of EUR 15,213,000 relating to a price
adjustment relating to the sale process of an investment that took place in 2017.
The balance Gains/(Losses) on disposal of other assets essentially include the result deducted from intermediation
costs from the sale of assets held by the Group and classified as non-current assets held for sale and as other
assets, which corresponds to a gain of EUR 7,893,000 (2024: gain of EUR 16,473,000).
Other assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Deposit account applications
61,273
58,404
Shareholder Loans
107,790
121,188
Surplus in the post-employment benefits
283,686
148,229
Debtors for futures and options transactions
195,542
151,776
Real estate and other assets arising from recovered loans (*)
234,742
293,150
Debtors
Residents
Receivables from real estate,\u00a0transfers of assets and other securities
47,216
57,446
Prosecution cases / agreements with the Bank
8,521
8,795
SIBS
2,366
2,770
Other
24,217
34,182
Non-residents
26,546
23,890
Amounts due for collection (**)
106,535
113,333
Interest and other amounts receivable
83,183
84,653
Amounts receivable on trading activity
20,674
1,584
Amounts due from customers
9,487
103,144
Artistic assets
28,795
28,796
Prepaid expenses
33,453
26,716
Subsidies receivables
13,155
14,908
Other taxes recoverable
13,066
7,878
Gold and other precious metals
3,533
3,693
Capital supplementary contributions
109
165
Associates
39
489
Receivables due from Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A. (under an \u2018CHF Portfolio Indemnity and
Guarantee Agreement)
219,623
186,420
Receivables due to legally invalidated foreign currency mortgage loans
80,839
62,550
Other
204,388
206,983
1,808,778
1,741,142
Impairment for other assets
(253,611)
(276,896)
1,555,167
1,464,246
(*) Amounts of real estate and other assets that do not meet the requirements of IFRS 5 (accounting policy G).
(**) This mainly corresponds to the specific position of the financial flow with SIBS within the scope of transactions carried out via ATMs.
The balance Deposit account applications includes the amount of EUR 30,638,000 ( 31\u00a0December 2024: EUR
30,638,000) relating to the collateral constituted in compliance with the assumption of irrevocable payment
commitments to Single Resolution Fund, as referred in note 46.
As referred in note 48, as at 31\u00a0December 2025, the balance Shareholder Loans includes the amount of EUR
100,375,000 (31\u00a0December 2024: EUR 113,840 ,000) arising from the transfers of assets to Specialized recovery funds
for which there is an impairment loss of the same amount.
The balance Amounts receivable on trading activity corresponds to operations pending financial settlement,
which had already taken place on the date these accounts were approved.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is
to periodically assess the collectability of these amounts and whenever impairment is identified, an impairment
loss is recorded in the income statement.
The detail of the item Real estate and other assets arising from recovered loans is analysed as follows:
(Thousands of euros)
2025
2024
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
68,804
(35,864)
32,940
118,564
(49,917)
68,647
Assets belong to investments funds
and real estate companies
135,403
(77,353)
58,050
137,598
(77,518)
60,080
Assets for own use (closed branches)
9,153
(3,194)
5,959
12,328
(4,817)
7,511
Equipment
13,965
(10,148)
3,817
14,792
(9,204)
5,588
Other assets (*)
7,417
\u2014
7,417
9,868
(19)
9,849
234,742
(126,559)
108,183
293,150
(141,475)
151,675
(*) includes Shares, Price Deposit and Property Adjudication Proposals
The changes occurred in Impairment of other assets, with the exception of impairment for Real estate and other
assets arising from recovered loans are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
135,421
184,992
Other transfers
705
(113)
Charge for the year (note 13)
13,943
18,407
Reversals for the year (note 13)
(3,452)
(5,339)
Amounts charged-off
(19,260)
(62,825)
Exchange rate differences
(305)
299
Balance at the end of the year
127,052
135,421
The changes occurred in impairment for Real Estate and other assets arising from recovered loans, are analysed as
follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
141,475
136,840
Other transfers
(18,179)
(8,461)
Charge for the year (note 13)
11,880
33,875
Reversals for the year (note 13)
(215)
(407)
Amounts charged-off
(4,993)
(21,891)
Exchange rate differences
(3,409)
1,519
Balance at the end of the year
126,559
141,475
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-671": { "value": "Net income from discontinued or discontinuing operations
The amount of this account is comprised of:
(Thousands of euros)
2025
2024
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
Correction of gains on disposal of the investment held
\u2014
322
\u2014
322
", "dimensions": { "concept": "ifrs-full:DisclosureOfDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-672": { "value": "Earnings per share
The earnings per share are calculated as follows:
(Thousands of euros)
2025
2024
Continuing operations
Net income from continuing operations
1,160,728
1,000,161
Non-controlling interests
(142,081)
(94,105)
Appropriated net income from continuing operations
1,018,647
906,056
Interests on perpetual subordinated bonds (Additional Tier 1)
(32,500)
(33,625)
Adjusted net income from continuing operations
986,147
872,431
Discontinued or discontinuing operations (note 17)
Net income from discontinued or discontinuing operations
\u2014
322
Adjusted net income
986,147
872,753
Average number of shares
14,938,596,848
15,113,989,952
Basic earnings per share (Euros)
0.066
0.058
Diluted earnings per share (Euros)
0.066
0.058
As at 31\u00a0December 2025, the Bank's share capital amounts to EUR 3,000,000,000 (2024: EUR 3,000,000,000) and is
represented by 14,804,627,089 (2024: 15,113,989,952) nominative book-entry shares without nominal value, fully
subscribed and paid up.
The calculation of the average number of shares as at 31\u00a0December 2025 (14,938,596,848 BCP shares) took into
account the repurchase of own shares that occurred in fiscal year of 2025 (309,362,863 BCP shares), which
programme is described in note 43.
There were not identified another dilution effects of the earnings per share as at 31\u00a0December 2025 and 2024, so
the diluted result is equivalent to the basic result.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEarningsPerShareExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-675": { "value": "Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Cash
668,685
666,175
Central Banks
Banco de Portugal
1,997,077
2,998,047
Central Banks abroad
1,423,778
1,924,808
4,089,540
5,589,030
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy
the legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective
liabilities. According to the European Central Bank System for Euro Zone, the cash reserve requirements establish
the maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other
liabilities, during each reserve requirement period. The rate is different for countries outside the Euro Zone.
According to the legislation of the Central Banks of Portugal, Poland, Mozambique and Monetary Authority of
Macao (AMCM), as at 31\u00a0December 2025, the minimum cash reserves are EUR 2,248,917,000 (31\u00a0December 2024:
EUR 2,365,095,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfCashAndBankBalancesAtCentralBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-674": { "value": "Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Cash
668,685
666,175
Central Banks
Banco de Portugal
1,997,077
2,998,047
Central Banks abroad
1,423,778
1,924,808
4,089,540
5,589,030
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy
the legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective
liabilities. According to the European Central Bank System for Euro Zone, the cash reserve requirements establish
the maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other
liabilities, during each reserve requirement period. The rate is different for countries outside the Euro Zone.
According to the legislation of the Central Banks of Portugal, Poland, Mozambique and Monetary Authority of
Macao (AMCM), as at 31\u00a0December 2025, the minimum cash reserves are EUR 2,248,917,000 (31\u00a0December 2024:
EUR 2,365,095,000).
Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Credit institutions in Portugal
6,506
3,553
Credit institutions abroad
108,635
166,850
Amounts due for collection
70,870
80,754
186,011
251,157
The balance Amounts due for collection represents, essentially, cheques due for collection on other financial
institutions. These balances were settled in the first days of the following month.
Loans and advances to credit institutions
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Loans and advances to Central Banks
Central Banks abroad
373,122
273,212
373,122
273,212
Loans and advances to credit institutions in Portugal
\u00a0 Term deposits
1,927
1,913
\u00a0 Loans
10,005
\u2014
\u00a0 Other
1,817
537
13,749
2,450
Loans and advances to credit institutions abroad
\u00a0 Very short-term deposits
117,563
99,486
\u00a0 Term deposits
313,885
324,524
\u00a0 Loans
4,291
\u2014
\u00a0 Term deposits to collateralise CIRS and IRS operations (*)
25,833
38,909
\u00a0 Other
13,300
59,066
474,872
521,985
861,743
797,647
Impairment for loans and advances to credit institutions
(498)
(112)
861,245
797,535
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in the respective
contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred operations (IRS and CIRS), whose
revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2025
2024
Up to 3 months
819,520
696,834
3 to 6 months
17,897
70,225
6 to 12 months
10,068
30,588
1 to 5 years
14,258
\u2014
861,743
797,647
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
112
224
Transfers
\u2014
(3)
Charge for the year (note 11)
471
216
Reversals for the year (note 11)
(63)
(327)
Exchange rate differences
(22)
2
Balance at the end of the year
498
112
", "dimensions": { "concept": "ifrs-full:DisclosureOfRestrictedCashAndCashEquivalentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-673": { "value": "Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Cash
668,685
666,175
Central Banks
Banco de Portugal
1,997,077
2,998,047
Central Banks abroad
1,423,778
1,924,808
4,089,540
5,589,030
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy
the legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective
liabilities. According to the European Central Bank System for Euro Zone, the cash reserve requirements establish
the maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other
liabilities, during each reserve requirement period. The rate is different for countries outside the Euro Zone.
According to the legislation of the Central Banks of Portugal, Poland, Mozambique and Monetary Authority of
Macao (AMCM), as at 31\u00a0December 2025, the minimum cash reserves are EUR 2,248,917,000 (31\u00a0December 2024:
EUR 2,365,095,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfCashAndCashEquivalentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-676": { "value": "Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Credit institutions in Portugal
6,506
3,553
Credit institutions abroad
108,635
166,850
Amounts due for collection
70,870
80,754
186,011
251,157
The balance Amounts due for collection represents, essentially, cheques due for collection on other financial
institutions. These balances were settled in the first days of the following month.
Loans and advances to credit institutions
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Loans and advances to Central Banks
Central Banks abroad
373,122
273,212
373,122
273,212
Loans and advances to credit institutions in Portugal
\u00a0 Term deposits
1,927
1,913
\u00a0 Loans
10,005
\u2014
\u00a0 Other
1,817
537
13,749
2,450
Loans and advances to credit institutions abroad
\u00a0 Very short-term deposits
117,563
99,486
\u00a0 Term deposits
313,885
324,524
\u00a0 Loans
4,291
\u2014
\u00a0 Term deposits to collateralise CIRS and IRS operations (*)
25,833
38,909
\u00a0 Other
13,300
59,066
474,872
521,985
861,743
797,647
Impairment for loans and advances to credit institutions
(498)
(112)
861,245
797,535
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in the respective
contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred operations (IRS and CIRS), whose
revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2025
2024
Up to 3 months
819,520
696,834
3 to 6 months
17,897
70,225
6 to 12 months
10,068
30,588
1 to 5 years
14,258
\u2014
861,743
797,647
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
112
224
Transfers
\u2014
(3)
Charge for the year (note 11)
471
216
Reversals for the year (note 11)
(63)
(327)
Exchange rate differences
(22)
2
Balance at the end of the year
498
112
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
", "dimensions": { "concept": "ifrs-full:DisclosureOfLoansAndAdvancesToBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-677": { "value": "Loans and advances to customers
The analysis of loans and advances to customers, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Mortgage loans
31,337,755
29,582,285
Loans
17,600,936
16,292,820
Finance leases
4,514,157
4,336,809
Factoring operations
2,537,479
2,495,783
Current account credits
824,486
827,079
Overdrafts
1,163,242
1,109,387
Discounted bills
156,544
143,419
58,134,599
54,787,582
Overdue loans - less than 90 days
119,191
108,019
Overdue loans - Over 90 days
468,710
498,191
58,722,500
55,393,792
Loans impairment
(1,315,825)
(1,486,734)
57,406,675
53,907,058
The balance Loans and advances to customers, as at 31 December 2025, is analysed as follows:
(Thousands of euros)
2025
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
510,544
\u2014
510,544
(1,119)
509,425
Asset-backed loans
33,450,676
92,984
33,543,660
(330,915)
33,212,745
Other guaranteed loans
4,618,812
64,311
4,683,123
(141,805)
4,541,318
Unsecured loans
10,175,011
291,940
10,466,951
(654,129)
9,812,822
Foreign loans
2,327,920
2,488
2,330,408
(24,536)
2,305,872
Factoring operations
2,537,479
49,986
2,587,465
(70,689)
2,516,776
Finance leases
4,514,157
86,192
4,600,349
(92,632)
4,507,717
58,134,599
587,901
58,722,500
(1,315,825)
57,406,675
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees
considered:
\u2013 Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable
(income consignment);
\u2013 Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal
guarantees.
The balance Loans and advances to customers, as at 31 December 2024, is analysed as follows:
(Thousands of euros)
2024
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
521,599
\u2014
521,599
(436)
521,163
Asset-backed loans
32,126,373
93,095
32,219,468
(491,470)
31,727,998
Other guaranteed loans
4,193,856
82,648
4,276,504
(193,038)
4,083,466
Unsecured loans
8,856,725
280,818
9,137,543
(625,803)
8,511,740
Foreign loans
2,256,437
2,288
2,258,725
(16,463)
2,242,262
Factoring operations
2,495,783
47,383
2,543,166
(69,609)
2,473,557
Finance leases
4,336,809
99,978
4,436,787
(89,915)
4,346,872
54,787,582
606,210
55,393,792
(1,486,734)
53,907,058
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees
considered:
\u2013 Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable
(income consignment);
\u2013 Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal
guarantees.
The balance Loans and advances to customers includes the amount of EUR 13,414,544,000 (31\u00a0December 2024:
EUR 10,932,203,000) regarding mortgage loans assigned to the cover pool backing the Group\u2019s covered bond
programme issuances.
As part of the liquidity risk management, the Group holds a pool of eligible assets that can serve as collateral in
funding operations with the European Central Bank and other Central Banks in countries where the Group
operates, which include loans and advances to customers.
As referred in note 52, the Group provides loans and/or guarantees to qualifying shareholders holding individually
or together with their affiliates, 5% or more of the share capital identified in the Board of Directors report and in
note 41.
The Group granted credit to qualifying shareholders and entities controlled by them, in the amount of EUR
118,176,000 (31\u00a0December 2024: EUR 113,027,000), as referred in note 52 a). The amount of impairment recognised
for these contracts amounts to EUR 1,147,000 ( 31\u00a0December 2024: EUR 2,834,000).
The conclusion of business between the Company and holders of qualifying holdings or individuals or legal
entities related to them in accordance with the provisions of article 33, no. 3 of Notice 3/2020 of Banco de Portugal,
regardless of the amount, is always subject of consideration and deliberation by the Board of Directors, after
obtaining a prior opinion from the Audit Committee, and by proposal of the Executive Committee, which in turn
deliberates under proposal from the Credit Committee, after obtaining an analysis and opinion from the
Compliance Office, which pronounces regarding the compliance of the proposed operations with internal
regulations, legal and regulatory provisions and other conditions that may apply to them, and the Risk Office,
which evaluates and issues an opinion on the risks inherent to the operation.
According to accounting policy C.4, there is a set of loans and advances to customers that are being hedged, the
impact of which is detailed in note 55.
The analysis of the outstanding amount of financial lease contracts, by type of customer, is presented as follows:
(Thousands of euros)
2025
2024
Individuals
Home
28,449
31,458
Consumption
27,534
25,404
Other
64,920
70,233
120,903
127,095
Companies
Equipment
2,191,405
2,061,780
Real estate
2,201,849
2,147,934
4,393,254
4,209,714
4,514,157
4,336,809
The analysis of loans and advances to customers, as at 31\u00a0December 2025, by sector of activity, is as follows:
(Thousands of euros)
2025
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
373,520
7,804
381,324
(11,889)
369,435
0.65%
Fisheries
17,290
319
17,609
(930)
16,679
0.03%
Mining
61,021
1,557
62,578
(2,222)
60,356
0.11%
Food, beverage and tobacco
761,364
18,195
779,559
(39,446)
740,113
1.33%
Textiles
368,557
25,233
393,790
(47,124)
346,666
0.67%
Wood and cork
233,351
4,664
238,015
(8,439)
229,576
0.41%
Paper, printing and publishing
134,021
259
134,280
(2,033)
132,247
0.23%
Chemicals
724,701
11,278
735,979
(33,873)
702,106
1.25%
Machinery, equipment and basic
metallurgical
1,372,775
48,033
1,420,808
(66,160)
1,354,648
2.42%
Electricity and gas
421,050
217
421,267
(5,191)
416,076
0.72%
Water
196,120
1,928
198,048
(7,101)
190,947
0.34%
Construction
1,428,968
22,329
1,451,297
(48,860)
1,402,437
2.47%
Retail business
1,722,367
18,101
1,740,468
(40,212)
1,700,256
2.96%
Wholesale business
2,148,787
35,103
2,183,890
(63,937)
2,119,953
3.72%
Restaurants and hotels
1,225,499
6,026
1,231,525
(27,818)
1,203,707
2.10%
Transports
1,268,103
19,002
1,287,105
(36,369)
1,250,736
2.19%
Post offices
23,150
651
23,801
(1,087)
22,714
0.04%
Telecommunications
257,925
490
258,415
(4,469)
253,946
0.44%
Services
Financial intermediation
1,504,942
1,369
1,506,311
(28,308)
1,478,003
2.57%
Real estate activities
2,594,679
19,242
2,613,921
(74,022)
2,539,899
4.45%
Consulting, scientific and technical
activities
994,942
9,113
1,004,055
(35,743)
968,312
1.71%
Administrative and support services
activities
540,579
3,917
544,496
(11,890)
532,606
0.93%
Public sector
417,667
\u2014
417,667
(4,428)
413,239
0.71%
Education
124,500
708
125,208
(2,042)
123,166
0.21%
Health and collective service activities
425,219
1,289
426,508
(4,924)
421,584
0.73%
Artistic, sports and recreational
activities
188,418
1,396
189,814
(4,697)
185,117
0.32%
Other services
309,705
4,838
314,543
(62,057)
252,486
0.54%
Consumer loans
7,629,025
232,817
7,861,842
(430,534)
7,431,308
13.39%
Mortgage loans
30,256,455
91,485
30,347,940
(174,972)
30,172,968
51.68%
Other domestic activities
18,538
444
18,982
(379)
18,603
0.03%
Other international activities
391,361
94
391,455
(34,669)
356,786
0.67%
58,134,599
587,901
58,722,500
(1,315,825)
57,406,675
100%
The analysis of loans and advances to customers, as at 31\u00a0December 2024, by sector of activity, is as follows:
(Thousands of euros)
2024
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
390,267
10,196
400,463
(14,639)
385,824
0.72%
Fisheries
18,901
58
18,959
(957)
18,002
0.03%
Mining
52,001
3,078
55,079
(4,006)
51,073
0.10%
Food, beverage and tobacco
736,423
9,472
745,895
(37,592)
708,303
1.35%
Textiles
348,987
13,203
362,190
(32,943)
329,247
0.65%
Wood and cork
207,603
5,955
213,558
(8,137)
205,421
0.39%
Paper, printing and publishing
124,157
2,235
126,392
(3,305)
123,087
0.23%
Chemicals
666,093
7,331
673,424
(29,424)
644,000
1.22%
Machinery, equipment and basic
metallurgical
1,239,540
38,533
1,278,073
(54,854)
1,223,219
2.31%
Electricity and gas
248,088
394
248,482
(2,312)
246,170
0.45%
Water
193,309
600
193,909
(6,842)
187,067
0.35%
Construction
1,510,101
26,967
1,537,068
(99,662)
1,437,406
2.78%
Retail business
1,679,344
18,041
1,697,385
(37,302)
1,660,083
3.06%
Wholesale business
1,981,080
38,314
2,019,394
(57,474)
1,961,920
3.65%
Restaurants and hotels
1,283,189
12,426
1,295,615
(44,778)
1,250,837
2.34%
Transports
1,245,907
16,935
1,262,842
(34,216)
1,228,626
2.28%
Post offices
20,007
333
20,340
(699)
19,641
0.04%
Telecommunications
321,680
4,947
326,627
(13,091)
313,536
0.59%
Services
Financial intermediation
1,321,460
1,776
1,323,236
(29,438)
1,293,798
2.39%
Real estate activities
2,092,573
22,147
2,114,720
(48,264)
2,066,456
3.82%
Consulting, scientific and technical
activities
895,509
9,567
905,076
(165,174)
739,902
1.63%
Administrative and support services
activities
507,604
4,164
511,768
(19,388)
492,380
0.92%
Public sector
562,272
\u2014
562,272
(3,272)
559,000
1.02%
Education
106,513
483
106,996
(2,066)
104,930
0.19%
Health and collective service activities
377,299
2,298
379,597
(9,429)
370,168
0.69%
Artistic, sports and recreational
activities
179,520
745
180,265
(6,329)
173,936
0.33%
Other services
248,951
3,957
252,908
(68,290)
184,618
0.46%
Consumer loans
7,204,086
240,734
7,444,820
(454,045)
6,990,775
13.44%
Mortgage loans
28,625,742
108,450
28,734,192
(188,885)
28,545,307
51.87%
Other domestic activities
1,577
191
1,768
(197)
1,571
0.00%
Other international activities
397,799
2,680
400,479
(9,724)
390,755
0.72%
54,787,582
606,210
55,393,792
(1,486,734)
53,907,058
100%
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31\u00a0December 2025, is
as follows:
(Thousands of euros)
2025
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
91,017
150,858
131,645
373,520
7,804
381,324
Fisheries
3,777
9,311
4,202
17,290
319
17,609
Mining
15,150
34,525
11,346
61,021
1,557
62,578
Food, beverage and tobacco
361,323
296,932
103,109
761,364
18,195
779,559
Textiles
132,578
154,060
81,919
368,557
25,233
393,790
Wood and cork
85,184
106,134
42,033
233,351
4,664
238,015
Paper, printing and publishing
33,563
66,557
33,901
134,021
259
134,280
Chemicals
252,190
365,582
106,929
724,701
11,278
735,979
Machinery, equipment and basic
metallurgical
531,649
637,155
203,971
1,372,775
48,033
1,420,808
Electricity and gas
36,519
115,035
269,496
421,050
217
421,267
Water
33,823
96,898
65,399
196,120
1,928
198,048
Construction
555,775
667,683
205,510
1,428,968
22,329
1,451,297
Retail business
506,877
726,918
488,572
1,722,367
18,101
1,740,468
Wholesale business
953,301
936,989
258,497
2,148,787
35,103
2,183,890
Restaurants and hotels
106,613
383,310
735,576
1,225,499
6,026
1,231,525
Transports
376,908
721,311
169,884
1,268,103
19,002
1,287,105
Post offices
8,403
13,122
1,625
23,150
651
23,801
Telecommunications
43,139
189,800
24,986
257,925
490
258,415
Services
Financial intermediation
310,518
526,890
667,534
1,504,942
1,369
1,506,311
Real estate activities
660,309
1,038,255
896,115
2,594,679
19,242
2,613,921
Consulting, scientific and technical
activities
259,377
459,508
276,057
994,942
9,113
1,004,055
Administrative and support
services activities
188,632
269,014
82,933
540,579
3,917
544,496
Public sector
25,721
170,168
221,778
417,667
\u2014
417,667
Education
40,937
45,526
38,037
124,500
708
125,208
Health and collective service
activities
132,583
130,324
162,312
425,219
1,289
426,508
Artistic, sports and recreational
activities
19,139
61,666
107,613
188,418
1,396
189,814
Other services
82,870
147,898
78,937
309,705
4,838
314,543
Consumer loans
2,382,455
3,697,630
1,548,940
7,629,025
232,817
7,861,842
Mortgage loans
423,946
1,754,402
28,078,107
30,256,455
91,485
30,347,940
Other domestic activities
11,611
1,695
5,232
18,538
444
18,982
Other international activities
180,851
84,848
125,662
391,361
94
391,455
8,846,738
14,060,004
35,227,857
58,134,599
587,901
58,722,500
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31\u00a0December 2024, is
as follows:
(Thousands of euros)
2024
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
83,432
175,896
130,939
390,267
10,196
400,463
Fisheries
4,126
11,471
3,304
18,901
58
18,959
Mining
14,084
28,670
9,247
52,001
3,078
55,079
Food, beverage and tobacco
351,773
310,562
74,088
736,423
9,472
745,895
Textiles
140,668
162,480
45,839
348,987
13,203
362,190
Wood and cork
85,459
88,526
33,618
207,603
5,955
213,558
Paper, printing and publishing
39,110
62,218
22,829
124,157
2,235
126,392
Chemicals
276,551
303,817
85,725
666,093
7,331
673,424
Machinery, equipment and basic
metallurgical
510,535
585,320
143,685
1,239,540
38,533
1,278,073
Electricity and gas
66,491
50,573
131,024
248,088
394
248,482
Water
39,926
83,348
70,035
193,309
600
193,909
Construction
597,788
675,906
236,407
1,510,101
26,967
1,537,068
Retail business
772,527
572,145
334,672
1,679,344
18,041
1,697,385
Wholesale business
944,617
826,534
209,929
1,981,080
38,314
2,019,394
Restaurants and hotels
90,580
357,928
834,681
1,283,189
12,426
1,295,615
Transports
374,216
744,224
127,467
1,245,907
16,935
1,262,842
Post offices
8,544
9,948
1,515
20,007
333
20,340
Telecommunications
77,654
198,055
45,971
321,680
4,947
326,627
Services
Financial intermediation
207,920
372,553
740,987
1,321,460
1,776
1,323,236
Real estate activities
442,976
916,681
732,916
2,092,573
22,147
2,114,720
Consulting, scientific and technical
activities
185,479
324,862
385,168
895,509
9,567
905,076
Administrative and support
services activities
155,502
258,484
93,618
507,604
4,164
511,768
Public sector
24,434
277,019
260,819
562,272
\u2014
562,272
Education
29,858
44,722
31,933
106,513
483
106,996
Health and collective service
activities
112,921
130,721
133,657
377,299
2,298
379,597
Artistic, sports and recreational
activities
14,974
59,982
104,564
179,520
745
180,265
Other services
74,171
117,508
57,272
248,951
3,957
252,908
Consumer loans
2,314,106
3,452,244
1,437,736
7,204,086
240,734
7,444,820
Mortgage loans
445,257
1,811,390
26,369,095
28,625,742
108,450
28,734,192
Other domestic activities
311
696
570
1,577
191
1,768
Other international activities
168,999
73,789
155,011
397,799
2,680
400,479
8,654,989
13,088,272
33,044,321
54,787,582
606,210
55,393,792
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31\u00a0December 2025, is as
follows:
(Thousands of euros)
2025
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
15,025
166,064
329,455
510,544
\u2014
510,544
Asset-backed loans
1,696,895
3,805,816
27,947,965
33,450,676
92,984
33,543,660
Other guaranteed loans
949,292
2,725,172
944,348
4,618,812
64,311
4,683,123
Unsecured loans
3,381,991
4,813,354
1,979,666
10,175,011
291,940
10,466,951
Foreign loans
246,299
416,108
1,665,513
2,327,920
2,488
2,330,408
Factoring operations
1,892,717
502,982
141,780
2,537,479
49,986
2,587,465
Finance leases
664,519
1,630,508
2,219,130
4,514,157
86,192
4,600,349
8,846,738
14,060,004
35,227,857
58,134,599
587,901
58,722,500
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31\u00a0December 2024, is as
follows:
(Thousands of euros)
2024
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
11,036
163,898
346,665
521,599
\u2014
521,599
Asset-backed loans
1,732,962
3,764,716
26,628,695
32,126,373
93,095
32,219,468
Other guaranteed loans
820,367
2,778,203
595,286
4,193,856
82,648
4,276,504
Unsecured loans
3,049,654
4,082,487
1,724,584
8,856,725
280,818
9,137,543
Foreign loans
160,067
503,065
1,593,305
2,256,437
2,288
2,258,725
Factoring operations
2,259,044
236,739
\u2014
2,495,783
47,383
2,543,166
Finance leases
621,859
1,559,164
2,155,786
4,336,809
99,978
4,436,787
8,654,989
13,088,272
33,044,321
54,787,582
606,210
55,393,792
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2025
2024
Stage 1
Gross amount
50,874,014
46,683,551
Impairment
(252,249)
(240,621)
50,621,765
46,442,930
Stage 2
Gross amount
6,382,660
6,891,393
Impairment
(296,454)
(265,533)
6,086,206
6,625,860
Stage 3
Gross amount
1,465,826
1,818,847
Impairment
(767,122)
(980,579)
698,704
838,268
Net amount
57,406,675
53,907,058
The exposure and impairment of the above table also includes the operations classified as POCI as detailed in note
55.
The analysis of the exposure covered by collaterals associated with loans and advances to customers' portfolio, by
stage according with IFRS 9, considering the collaterals' fair value, is as follows:
(Thousands of euros)
2025
2024
Stage 1
Securities and other financial assets
1,349,916
1,413,424
Residential real estate
27,169,047
26,221,230
Other real estate
3,949,611
3,501,937
Other guarantees
8,881,118
8,632,995
41,349,692
39,769,586
Stage 2
Securities and other financial assets
130,311
179,566
Residential real estate
2,102,200
2,890,023
Other real estate
887,342
851,129
Other guarantees
1,549,444
1,266,171
4,669,297
5,186,889
Stage 3
Securities and other financial assets
12,647
17,158
Residential real estate
366,942
455,773
Other real estate
157,621
181,136
Other guarantees
265,994
275,656
803,204
929,723
46,822,193
45,886,198
The balance Other guarantees include first-demand guarantees issued by the Bank and other entities, with an
internal risk rating of 108 or better; personal guarantees, when the guarantors are classified with internal risk
grade 108 or better. This balance also includes pledges, assets subject to financial leasing operations and personal
guarantees, among others.
Considering the policy of risk management of the Group (note 55), the amounts presented do not include the fair
value of the personal guarantees provided by customers with lower risk rating. When considered, the fair value of
the personal guarantees corresponds to the guaranteed amount.
The Group is applying physical collaterals and financial guarantees as instruments to mitigate the credit risk. The
physical collaterals are mainly mortgages on residential buildings for the mortgage portfolio and other mortgages
on other types of buildings related to other types of loans. To reflect the market value, these collaterals are
regularly reviewed based on independent and certified valuation entities or through the application of revaluation
coefficients that reflect the market trends for each specific type of building and geographical area. The financial
guarantees are reviewed based on the market value of the respective assets, when available, with the subsequent
application of haircuts that reflect the volatility of their prices. The Group continued to negotiate additional
physical and financial collaterals with its customers.
The loans and advances to customers' portfolio includes contracts that resulted in a formal restructuring with the
customers and which arise to the marking of operations as being restructured due to financial difficulties of
customers. The restructuring may include in a reinforce of guarantees, liquidation of part of the credit and imply
an extension of maturities or changes in interest rate. The analysis of the restructured loans, by sector of activity, is
as follows:
(Thousands of euros)
2025
2024
Restructured
loans
Impairment
(*)
Net
amount
Restructured
loans
Impairment
(*)
Net
amount
Agriculture and forestry
11,301
(2,742)
8,559
10,656
(3,355)
7,301
Fisheries
5,390
(492)
4,898
540
(23)
517
Mining
574
(265)
309
2,421
(1,867)
554
Food, beverage and tobacco
15,118
(8,625)
6,493
12,299
(6,785)
5,514
Textiles
10,448
(2,627)
7,821
8,176
(2,318)
5,858
Wood and cork
5,555
(975)
4,580
3,688
(504)
3,184
Paper, printing and publishing
433
(77)
356
1,290
(953)
337
Chemicals
13,557
(8,126)
5,431
18,869
(7,813)
11,056
Machinery, equipment and basic
metallurgical
20,356
(6,985)
13,371
16,718
(5,461)
11,257
Electricity and gas
22,428
(545)
21,883
23,007
(325)
22,682
Water
493
(227)
266
247
(35)
212
Construction
14,978
(4,222)
10,756
61,430
(46,455)
14,975
Retail business
13,148
(1,941)
11,207
14,059
(2,479)
11,580
Wholesale business
28,443
(6,517)
21,926
30,457
(8,330)
22,127
Restaurants and hotels
16,954
(1,016)
15,938
117,672
(10,704)
106,968
Transports
6,539
(2,831)
3,708
5,334
(3,002)
2,332
Post offices
192
(157)
35
43
(13)
30
Telecommunications
379
(200)
179
4,213
(2,225)
1,988
Services
Financial intermediation
58,036
(14,262)
43,774
8,610
(328)
8,282
Real estate activities
48,690
(18,884)
29,806
56,397
(14,015)
42,382
Consulting, scientific and
technical activities
22,663
(3,611)
19,052
161,308
(132,149)
29,159
Administrative and support
services activities
11,231
(1,286)
9,945
26,654
(8,869)
17,785
Public sector
56,723
(867)
55,856
65,172
(753)
64,419
Education
2,509
(324)
2,185
1,661
(90)
1,571
Health and collective service
activities
2,651
(165)
2,486
7,589
(286)
7,303
Artistic, sports and recreational
activities
1,422
(1,058)
364
7,764
(2,070)
5,694
Other services
9,767
(783)
8,984
8,236
(1,192)
7,044
Consumer loans
205,302
(97,366)
107,936
257,104
(119,696)
137,408
Mortgage loans
460,854
(68,609)
392,245
573,978
(75,614)
498,364
Other domestic activities
1
\u2014
1
3
\u2014
3
Other international activities
230
(191)
39
340
(201)
139
1,066,365
(255,976)
810,389
1,505,935
(457,910)
1,048,025
(*) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in point
ii. of the section \"Additional measures with impact on the Impairment level\" of note 55.
The breakdown of the restructured loans as at 31\u00a0December 2025, by restructuring measure, is as follows:
(Thousands of euros)
2025
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
32,461
202,838
72,773
275,611
(110,585)
165,026
Introduction of the grace period for
capital and / or interest
6,348
233,472
21,628
255,100
(56,958)
198,142
Interest rate reduction
2,538
119,336
7,732
127,068
(24,171)
102,897
Payment plan change
5,921
127,638
7,187
134,825
(24,968)
109,857
Debt relief
18
205
387
592
(460)
132
Debt-asset swaps
2
15
14
29
(6)
23
Other restructured loans
5,612
254,249
18,891
273,140
(38,828)
234,312
52,900
937,753
128,612
1,066,365
(255,976)
810,389
The breakdown of the restructured loans as at 31\u00a0December 2024, by restructuring measure, is as follows:
(Thousands of euros)
2024
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
41,619
316,318
77,407
393,725
(133,152)
260,573
Introduction of the grace period for
capital and / or interest
6,811
287,481
33,107
320,588
(118,007)
202,581
Interest rate reduction
2,318
114,282
1,841
116,123
(8,155)
107,968
Payment plan change
6,930
296,183
9,248
305,431
(147,568)
157,863
Debt relief
31
450
480
930
(742)
188
Debt-asset swaps
3
18
15
33
(12)
21
Other restructured loans
5,088
341,437
27,668
369,105
(50,274)
318,831
62,800
1,356,169
149,766
1,505,935
(457,910)
1,048,025
(*) The impairment presented in the tables does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of note 55.
The restructured loans are also subject to an impairment analysis resulting from the revaluation of expectation to
meet new cash flows inherent to the new contract terms and considering new collaterals.
The Group has implemented a process for marking operations restructured due to customers' financial difficulties.
This marking is part of the credit analysis process, being in charge of the respective decision-making bodies,
according to the corresponding competencies, established in the regulations in force.
The information on operations restructured due to financial difficulties is available in the Group's information
systems, having a relevant role in the processes of credit analysis, in the marking of customers in default and in
the process of determining impairment. In particular:
- there are several default triggers related to restructuring due to financial difficulties (restructuring with loss of
value, recidivism of restructuring, default on customers with restructured operations);
- in the process of individual impairment analysis, in addition to the existence of operations restructured due to
financial difficulties, being a reason for customer selection, the loss inherent to the change in the conditions
resulting from the restructuring is determined.
An operation marked as restructured due to financial difficulties, can only be unmarked at least 2 years after the
date of marking, provided that a set of conditions exist that allow to conclude by the improvement of the financial
condition of the customer. In the case of credits marked as Non-Performing Exposure (NPE), this 2-year period will
only start on the date of classification of the credit as performing.
The definition of Non-Performing Loans for more than 90 days (NPL > 90) incorporates total credit (past due plus
outstanding) associated with past due operations for more than 90 days. The amount calculated is EUR
740,933,000 (31\u00a0December 2024: EUR 791,051,000).
All customers who check at least one of the following conditions are marked in default and therefore as NPE:
- Material payment delay of more than 90 days in the amounts of principal, interest or unpaid commissions on the
due date that, cumulatively, represent: more than EUR 100 (retail) or more than EUR 500 (non-retail); and more
than 1% of the total debt (direct liabilities).
- Indications of low probability of payment:
a) Credit restructuring due to financial difficulties with loss of value; b) Delay after restructuring due to financial
difficulties; c) Recurrence of restructuring due to financial difficulties; d) Credit with signs of impairment (or Stage
3 of IFRS 9); e) Insolvency or equivalent process; f) Litigation; g) Guarantees of operations in default; h) Loss of
credit sales; i) Credit fraud; j) Unpaid credit status; k) Breach of covenants in a credit agreement; l) Contagion of
default in an economic group; m) Cross default in the BCP Group.
The NPE associated with Loans and advances customers at amortised cost amounts to EUR 1,465,826,000
(31\u00a0December 2024: EUR 1,819,847,000).
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,486,734
1,582,650
Charge for the year in net income interest
24,584
37,861
Other transfers
(187,332)
(992)
Impairment charge for the year (note 11)
745,135
804,883
Reversals for the year (note 11)
(523,071)
(550,457)
Loans charged-off
Write-offs
(66,162)
(97,731)
Credit assignments
(168,289)
(301,290)
Exchange rate differences
4,226
11,810
Balance at the end of the year
1,315,825
1,486,734
According to note 39, regarding the proceedings related to foreign currency-indexed mortgages of Bank
Millennium the amount of EUR 869,230,000 has been written-off from the gross carrying amount of loans portfolio
(31\u00a0December 2024: EUR 1,324,672,000).
The analysis of Write-offs, by sector of activity, is as follows:
(Thousands of euros)
2025
2024
Agriculture and forestry
1,138
1,880
Fisheries
4
1
Mining
39
138
Food, beverage and tobacco
359
226
Textiles
785
363
Wood and cork
324
194
Paper, printing and publishing
858
75
Chemicals
1,617
374
Machinery, equipment and basic metallurgical
4,198
1,216
Electricity and gas
1
51
Water
226
49
Construction
4,741
3,922
Retail business
1,642
1,050
Wholesale business
4,174
3,211
Restaurants and hotels
1,805
5,848
Transports
4,328
2,101
Post offices
85
61
Telecommunications
12
1,090
Services
Financial intermediation
624
(15,097)
Real estate activities
4,134
1,130
Consulting, scientific and technical activities
581
23,911
Administrative and support services activities
488
(33,921)
Education
96
217
Health and collective service activities
343
165
Artistic, sports and recreational activities
38
5,525
Other services
1,144
4,575
Consumer loans
28,039
59,729
Mortgage loans
3,808
3,089
Other domestic activities
260
387
Other international activities
271
26,171
66,162
97,731
According to the accounting policy described in note 1 C1.3, the Group writes off a loan when it does not have
reasonable expectations of recovering a financial asset in its entirety or partially. Loans written-off are recognised
in off-balance sheet accounts.
The analysis of Write-offs, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Asset-backed loans
8,923
4,268
Other guaranteed loans
5,896
5,670
Unsecured loans
42,891
52,733
Foreign loans
\u2014
21,873
Finance leases
8,452
13,187
66,162
97,731
The analysis of recovered loans and interest occurred during 2025 and 2024, by sector of activity, is as follows:
(Thousands of euros)
2025
2024
Agriculture and forestry
586
3
Food, beverage and tobacco
122
609
Textiles
40
23
Wood and cork
414
63
Chemicals
681
651
Machinery, equipment and basic metallurgical
53
49
Water
14
4
Construction
921
6,896
Retail business
260
826
Wholesale business
261
1,367
Restaurants and hotels
50
41
Transports
414
1,005
Post offices
2
1
Telecommunications
20
10
Services
Financial intermediation
2,765
68
Real estate activities
255
111
Consulting, scientific and technical activities
43
29
Administrative and support services activities
91
581
Health and collective service activities
10
30
Artistic, sports and recreational activities
6
1
Other services
5
504
Consumer loans
7,384
10,187
Mortgage loans
868
742
Other domestic activities
362
37
Other international activities
2,453
46,786
18,080
70,624
The analysis of recovered loans and interest occurred during 2025 and 2024, by type of credit, is as follows:
(Thousands of euros)
2025
2024
Asset-backed loans
1,943
7,554
Other guaranteed loans
3,539
1,879
Unsecured loans
11,378
13,519
Foreign loans
381
46,684
Finance leases
839
988
18,080
70,624
The balance Loans and advances to customers includes the effect of traditional securitisation transactions made
through Special Purpose Entities (SPE) consolidated following the application of IFRS 10, in accordance with
accounting policy 1 B and synthetic securitisation. The characterisation of these operations is described in note 1 D.
Traditional securitisations
The traditional securitisation transactions engaged by BCP and still ongoing, refer to mortgage loan portfolios and
were structured through securitisation funds and special purpose entities (SPEs). As referred in accounting policy 1
B, when the substance of the relationship with an\u00a0 SPE indicates that the Group holds control of its activities, such
entities are consolidated by the full method.
Magellan Mortgages No. 3
On 24 June 2005, the Bank transferred, through a securitisation fund, a mortgage loan portfolio to the SPE
\u201cMagellan Mortgages No. 3 PLC\u201d. Considering that, by having acquired part of the subordinated tranche of the
bonds issued by that SPE, the Bank holds\u00a0 control of the referred assets and so the SPE is consolidated in the
Group\u2019s Financial Statements, as established in the accounting policy 1.B.\u00a0 As at 31\u00a0December 2025, the SPE's credit
portfolio associated with this operation amounts to EUR 119,915,000 (31\u00a0December 2024: EUR 139,770,000) and
bonds issued with different subordination levels amount to EUR 91,743,000 (this amount excludes bonds held by
the Group in the amount of EUR 41,290,000) and the most subordinated tranche amounts to EUR 44,000 (this
amount excludes bonds already acquired by the Group in the amount EUR 206,000).
Synthetic securitisations
BCP has two transactions ongoing which form synthetic securitisation structures with similar characteristics, with
reference to credit portfolios granted by the Bank mainly to Small and Medium-sized Enterprises (SMEs), as refer
in accounting policy presented in note 1 D 2.
Caravela SME No.5
Caravela SME No.5, initiated on 20 December 2022, is supported by a portfolio of medium and long-term loans,
leasing contract and commercial paper programmes. The legal maturity date is 26 September of 2035 and, as at
31\u00a0December 2025, the transaction amounts to EUR 661,171,000 (31\u00a0December 2024: EUR 1,047,392,000). The fair
value of the relative CDS is recorded as a negative amount of EUR 8,538,000 (31\u00a0December 2024: negative amount
EUR 30,540,000) and a gain of EUR 1,497,000 was recognised in 2025 (31\u00a0December 2024: cost of EUR 14,839,000).
Caravela SME No.6
Caravela SME No. 6, initiated on 28 February 2024, is supported by a credit portfolio of short-term exposures to
Portuguese SME and Corporate customers, in the form of current accounts overdrafts, authorised overdrafts and
confirming agreements. The legal maturity date is 26 March of 2028 and the operation amounts to EUR
850,000,000 (31\u00a0December 2024: EUR 850,000,000). The fair value of the relative CDS is recorded as a negative
amount of EUR 13,665,000 (31\u00a0December 2024: negative amount of EUR 20,330,000) and a cost of EUR 7,948,000
was recognised in 2025 (31\u00a0December 2024: cost of EUR 7,107,000).
In both transactions, the Bank contracted a Credit Default Swap (CDS) with a Special Purpose Entity (SPE),
acquiring credit risk protection on the referenced portfolios. Within these synthetic structures, the credit risk of
the respective portfolios was subdivided into three tranches: senior, mezzanine and equity.\u00a0 The entire mezzanine
tranche has been placed on the market, while the Bank retained the risk of the senior and equity tranches. The
proceeds from the issuance of the Credit-Linked Notes (CLNs) were applied by each SPE in the constitution of a
deposit which fully collateralises its liabilities to its creditors in connection with each transaction, including the
Bank.
Within the scope of the active management of its synthetic securitisation structures, the Bank exercised the
contractual termination options in respect of Caravela SME No. 4 and Caravela SME No. 3, whose respective Credit
Default Swap (CDS) contracts were terminated on 22 December 2025 and 30 December 2025, respectively.
These transactions allowed the Bank to reduce the risk-weighted assets associated with the underlying credit
portfolios, but the Bank did not transfer to third parties most of the rights and obligations arising from the credits
included in the respective portfolios, thus not meeting the derecognition criteria in the accounting policy
presented in note 1 C1.3.
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
During 2025, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,391,263)
2,391,263
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(260,957)
\u2014
260,957
\u2014
\u2014
Transfers from stage 2 to stage 1
2,357,970
(2,357,970)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(356,580)
356,580
\u2014
\u2014
Transfers from stage 3 to stage 1
48,989
\u2014
(48,989)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
176,041
(176,041)
\u2014
\u2014
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
4,434,611
(360,315)
(676,956)
(2,470)
3,394,870
Gross amount at the end of the year
50,871,677
6,376,942
1,449,026
24,855
58,722,500
During 2024, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
45,651,670
7,290,622
1,914,768
30,749
54,887,809
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,071,117)
2,071,117
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(297,555)
\u2014
297,555
\u2014
\u2014
Transfers from stage 2 to stage 1
1,958,521
(1,958,521)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(420,581)
420,581
\u2014
\u2014
Transfers from stage 3 to stage 1
26,670
\u2014
(26,670)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
128,195
(128,195)
\u2014
\u2014
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Net balance of new financial assets and
derecognised financial assets and other variations
1,417,722
(222,759)
(591,235)
(14)
603,714
Gross amount at the end of the year
46,682,797
6,885,087
1,796,641
29,267
55,393,792
", "dimensions": { "concept": "ifrs-full:DisclosureOfLoansAndAdvancesToCustomersExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-678": { "value": "
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2025
2024
Stage 1
Gross amount
50,874,014
46,683,551
Impairment
(252,249)
(240,621)
50,621,765
46,442,930
Stage 2
Gross amount
6,382,660
6,891,393
Impairment
(296,454)
(265,533)
6,086,206
6,625,860
Stage 3
Gross amount
1,465,826
1,818,847
Impairment
(767,122)
(980,579)
698,704
838,268
Net amount
57,406,675
53,907,058
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,486,734
1,582,650
Charge for the year in net income interest
24,584
37,861
Other transfers
(187,332)
(992)
Impairment charge for the year (note 11)
745,135
804,883
Reversals for the year (note 11)
(523,071)
(550,457)
Loans charged-off
Write-offs
(66,162)
(97,731)
Credit assignments
(168,289)
(301,290)
Exchange rate differences
4,226
11,810
Balance at the end of the year
1,315,825
1,486,734
During 2025, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
240,621
265,341
969,138
11,634
1,486,734
Change in impairment losses:
Transfer to Stage 1
61,397
(51,481)
(9,864)
(52)
\u2014
Transfer to Stage 2
(19,960)
70,779
(50,819)
\u2014
\u2014
Transfer to Stage 3
(4,783)
(35,016)
40,066
(267)
\u2014
Changes occurred due to changes in credit risk
(54,671)
32,959
180,404
332
159,024
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Changes due to new financial assets and
derecognised financial assets and other variations
30,115
14,304
(306,145)
(2,045)
(263,771)
Impairment losses at the end of the year
252,249
296,302
759,614
7,660
1,315,825
During 2024, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
268,948
291,752
1,007,481
14,469
1,582,650
Change in impairment losses:
Transfer to Stage 1
63,989
(57,318)
(6,549)
(122)
\u2014
Transfer to Stage 2
(13,493)
45,311
(31,818)
\u2014
\u2014
Transfer to Stage 3
(5,250)
(40,730)
46,185
(205)
\u2014
Changes occurred due to changes in credit risk
(98,325)
19,729
240,744
979
163,127
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Changes due to new financial assets and derecognised
financial assets and other variations
27,866
9,583
(196,742)
(2,019)
(161,312)
Impairment losses at the end of the year
240,621
265,341
969,138
11,634
1,486,734
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
27,912,683
1,724,254
164,858
63,735
1,952,847
243,962
133,169
377,131
8,151
30,250,812
Individuals-Other
10,293,222
1,112,561
119,694
47,582
1,279,837
179,123
312,892
492,015
8,562
12,073,636
Financial Companies
3,469,121
471,063
1,889
34
472,986
14,565
2,213
16,778
\u2014
3,958,885
Non-financial companies -
Corporate
9,556,611
1,010,324
12,425
1,096
1,023,845
139,011
53,567
192,578
117
10,773,151
Non-financial companies -
SME-Corporate
9,378,672
1,782,468
11,756
12,078
1,806,302
315,449
119,290
434,739
5,900
11,625,613
Non-financial companies -
SME-Retail
7,169,460
1,178,965
94,826
25,340
1,299,131
128,889
117,746
246,635
2,986
8,718,212
Non-financial companies -
Other
3,172,509
33,787
\u2014
\u2014
33,787
31,431
4,922
36,353
\u2014
3,242,649
Other loans
21,089,015
709,238
\u2014
88,467
797,705
\u2014
\u2014
\u2014
\u2014
21,886,720
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Individuals-Mortgages
9,111
16,736
4,302
3,328
24,366
72,363
46,612
118,975
3,575
156,027
Individuals-Other
82,776
66,824
18,745
13,697
99,266
84,033
220,900
304,933
4,085
491,060
Financial Companies
17,774
6,690
92
2
6,784
12,651
1,120
13,771
\u2014
38,329
Non-financial companies -
Corporate
41,456
32,864
414
72
33,350
72,516
25,273
97,789
\u2014
172,595
Non-financial companies -
SME-Corporate
62,270
63,127
746
1,574
65,447
139,954
75,533
215,487
\u2014
343,204
Non-financial companies -
SME-Retail
70,155
58,625
6,371
4,240
69,236
46,642
54,102
100,744
\u2014
240,135
Non-financial companies -
Other
11,301
466
\u2014
\u2014
466
29,384
4,705
34,089
\u2014
45,856
Other loans
17,197
94,751
\u2014
18,650
113,401
\u2014
\u2014
\u2014
\u2014
130,598
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Individuals-Mortgages
27,903,572
1,707,518
160,556
60,407
1,928,481
171,599
86,557
258,156
4,576
30,094,785
Individuals-Other
10,210,446
1,045,737
100,949
33,885
1,180,571
95,090
91,992
187,082
4,477
11,582,576
Financial Companies
3,451,347
464,373
1,797
32
466,202
1,914
1,093
3,007
\u2014
3,920,556
Non-financial companies -
Corporate
9,515,155
977,460
12,011
1,024
990,495
66,495
28,294
94,789
117
10,600,556
Non-financial companies -
SME-Corporate
9,316,402
1,719,341
11,010
10,504
1,740,855
175,495
43,757
219,252
5,900
11,282,409
Non-financial companies -
SME-Retail
7,099,305
1,120,340
88,455
21,100
1,229,895
82,247
63,644
145,891
2,986
8,478,077
Non-financial companies -
Other
3,161,208
33,321
\u2014
\u2014
33,321
2,047
217
2,264
\u2014
3,196,793
Other loans
21,071,818
614,487
\u2014
69,817
684,304
\u2014
\u2014
\u2014
\u2014
21,756,122
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Individuals-Mortgages
0.03%
0.97%
2.61%
5.22%
1.25%
29.66%
35.00%
31.55%
43.86%
0.52%
Individuals-Other
0.80%
6.01%
15.66%
28.79%
7.76%
46.91%
70.60%
61.98%
47.71%
4.07%
Financial Companies
0.51%
1.42%
4.87%
5.88%
1.43%
86.86%
50.61%
82.08%
0.00%
0.97%
Non-financial companies -
Corporate
0.43%
3.25%
3.33%
6.57%
3.26%
52.17%
47.18%
50.78%
0.00%
1.60%
Non-financial companies -
SME-Corporate
0.66%
3.54%
6.35%
13.03%
3.62%
44.37%
63.32%
49.57%
0.00%
2.95%
Non-financial companies -
SME-Retail
0.98%
4.97%
6.72%
16.73%
5.33%
36.19%
45.95%
40.85%
0.00%
2.75%
Non-financial companies -
Other
0.36%
1.38%
0.00%
0.00%
1.38%
93.49%
95.59%
93.77%
0.00%
1.41%
Other loans
0.08%
13.36%
0.00%
21.08%
14.22%
0.00%
0.00%
0.00%
0.00%
0.60%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
25,410,533
2,531,556
198,053
85,589
2,815,198
284,617
162,464
447,081
10,005
28,682,817
Individuals-Other
9,297,921
1,181,727
126,969
52,644
1,361,340
239,235
327,737
566,972
11,793
11,238,026
Financial Companies
3,450,266
40,675
5
17
40,697
13,035
15
13,050
\u2014
3,504,013
Non-financial companies -
Corporate
11,151,305
716,267
6,363
49
722,679
159,996
39,604
199,600
5,226
12,078,810
Non-financial companies -
SME-Corporate
9,034,618
1,762,243
22,710
9,089
1,794,042
499,686
122,876
622,562
1,605
11,452,827
Non-financial companies -
SME-Retail
6,524,804
1,077,758
31,069
21,154
1,129,981
117,188
155,779
272,967
3,428
7,931,180
Non-financial companies -
Other
548,529
21,754
\u2014
\u2014
21,754
\u2014
500
500
\u2014
570,783
Other loans
19,152,578
263,254
335
1,561
265,150
445
\u2014
445
\u2014
19,418,173
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Individuals-Mortgages
11,712
24,030
4,054
3,446
31,530
66,785
57,269
124,054
4,482
171,778
Individuals-Other
61,763
56,698
19,156
12,863
88,717
104,205
228,644
332,849
6,883
490,212
Financial Companies
21,558
2,072
1
2
2,075
12,448
9
12,457
\u2014
36,090
Non-financial companies -
Corporate
41,412
20,142
34
4
20,180
90,639
18,505
109,144
269
171,005
Non-financial companies -
SME-Corporate
41,250
56,922
3,852
2,204
62,978
283,615
56,392
340,007
\u2014
444,235
Non-financial companies -
SME-Retail
79,907
64,710
3,220
3,252
71,182
72,307
70,111
142,418
\u2014
293,507
Non-financial companies -
Other
651
27
\u2014
\u2014
27
\u2014
272
272
\u2014
950
Other loans
51,718
4,260
14
280
4,554
117
\u2014
117
\u2014
56,389
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Individuals-Mortgages
25,398,821
2,507,526
193,999
82,143
2,783,668
217,832
105,195
323,027
5,523
28,511,039
Individuals-Other
9,236,158
1,125,029
107,813
39,781
1,272,623
135,030
99,093
234,123
4,910
10,747,814
Financial Companies
3,428,708
38,603
4
15
38,622
587
6
593
\u2014
3,467,923
Non-financial companies -
Corporate
11,109,893
696,125
6,329
45
702,499
69,357
21,099
90,456
4,957
11,907,805
Non-financial companies -
SME-Corporate
8,993,368
1,705,321
18,858
6,885
1,731,064
216,071
66,484
282,555
1,605
11,008,592
Non-financial companies -
SME-Retail
6,444,897
1,013,048
27,849
17,902
1,058,799
44,881
85,668
130,549
3,428
7,637,673
Non-financial companies -
Other
547,878
21,727
\u2014
\u2014
21,727
\u2014
228
228
\u2014
569,833
Other loans
19,100,860
258,994
321
1,281
260,596
328
\u2014
328
\u2014
19,361,784
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Individuals-Mortgages
0.05%
0.95%
2.05%
4.03%
1.12%
23.46%
35.25%
27.75%
44.80%
0.60%
Individuals-Other
0.66%
4.80%
15.09%
24.43%
6.52%
43.56%
69.76%
58.71%
58.37%
4.36%
Financial Companies
0.62%
5.09%
20.00%
11.76%
5.10%
95.50%
60.00%
95.46%
0.00%
1.03%
Non-financial companies -
Corporate
0.37%
2.81%
0.53%
8.16%
2.79%
56.65%
46.73%
54.68%
5.15%
1.42%
Non-financial companies -
SME-Corporate
0.46%
3.23%
16.96%
24.25%
3.51%
56.76%
45.89%
54.61%
0.00%
3.88%
Non-financial companies -
SME-Retail
1.22%
6.00%
10.36%
15.37%
6.30%
61.70%
45.01%
52.17%
0.00%
3.70%
Non-financial companies -
Other
0.12%
0.12%
0.00%
0.00%
0.12%
0.00%
54.40%
54.40%
0.00%
0.17%
Other loans
0.27%
1.62%
4.18%
17.94%
1.72%
26.29%
0.00%
26.29%
0.00%
0.29%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past
due <=
30 days
Days
past
due >
30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Loans to individuals
38,205,905
2,836,815
284,552
111,317
3,232,684
423,085
446,061
869,146
16,713
42,324,448
Non-financial companies -
Trade
5,761,596
825,034
16,753
7,939
849,726
63,983
60,891
124,874
594
6,736,790
Non-financial companies -
Construction
3,025,258
491,950
13,816
3,764
509,530
226,993
31,456
258,449
640
3,793,877
Non-financial companies -
Manufacturing industries
5,898,525
866,217
17,949
4,764
888,930
137,782
125,158
262,940
4,712
7,055,107
Non-financial companies -
Other activities
2,503,502
308,930
6,024
1,650
316,604
17,510
12,076
29,586
16
2,849,708
Non-financial companies -
Other services
12,088,371
1,513,413
64,465
20,397
1,598,275
168,512
65,944
234,456
3,041
13,924,143
Other Services /Other
activities
24,558,136
1,180,301
1,889
88,501
1,270,691
14,565
2,213
16,778
\u2014
25,845,605
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Loans to individuals
91,887
83,560
23,047
17,025
123,632
156,396
267,512
423,908
7,660
647,087
Non-financial companies -
Trade
32,237
27,470
1,207
1,323
30,000
23,077
26,655
49,732
\u2014
111,969
Non-financial companies -
Construction
16,448
11,203
1,106
690
12,999
80,248
16,689
96,937
\u2014
126,384
Non-financial companies -
Manufacturing industries
44,103
40,034
946
701
41,681
87,029
78,428
165,457
\u2014
251,241
Non-financial companies -
Other activities
12,409
12,921
303
265
13,489
7,860
6,927
14,787
\u2014
40,685
Non-financial companies -
Other services
79,985
63,454
3,969
2,907
70,330
90,282
30,914
121,196
\u2014
271,511
Other Services /Other
activities
34,971
101,441
92
18,652
120,185
12,651
1,120
13,771
\u2014
168,927
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Loans to individuals
38,114,018
2,753,255
261,505
94,292
3,109,052
266,689
178,549
445,238
9,053
41,677,361
Non-financial companies -
Trade
5,729,359
797,564
15,546
6,616
819,726
40,906
34,236
75,142
594
6,624,821
Non-financial companies -
Construction
3,008,810
480,747
12,710
3,074
496,531
146,745
14,767
161,512
640
3,667,493
Non-financial companies -
Manufacturing industries
5,854,422
826,183
17,003
4,063
847,249
50,753
46,730
97,483
4,712
6,803,866
Non-financial companies -
Other activities
2,491,093
296,009
5,721
1,385
303,115
9,650
5,149
14,799
16
2,809,023
Non-financial companies -
Other services
12,008,386
1,449,959
60,496
17,490
1,527,945
78,230
35,030
113,260
3,041
13,652,632
Other Services /Other
activities
24,523,165
1,078,860
1,797
69,849
1,150,506
1,914
1,093
3,007
\u2014
25,676,678
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Loans to individuals
0.24%
2.95%
8.10%
15.29%
3.82%
36.97%
59.97%
48.77%
45.83%
1.53%
Non-financial companies -
Trade
0.56%
3.33%
7.20%
16.66%
3.53%
36.07%
43.77%
39.83%
0.00%
1.66%
Non-financial companies -
Construction
0.54%
2.28%
8.01%
18.33%
2.55%
35.35%
53.06%
37.51%
0.00%
3.33%
Non-financial companies -
Manufacturing industries
0.75%
4.62%
5.27%
14.71%
4.69%
63.16%
62.66%
62.93%
0.00%
3.56%
Non-financial companies -
Other activities
0.50%
4.18%
5.03%
16.06%
4.26%
44.89%
57.36%
49.98%
0.00%
1.43%
Non-financial companies -
Other services
0.66%
4.19%
6.16%
14.25%
4.40%
53.58%
46.88%
51.69%
0.00%
1.95%
Other Services /Other
activities
0.14%
8.59%
4.87%
21.08%
9.46%
86.86%
50.61%
82.08%
0.00%
0.65%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit losses and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
34,708,454
3,713,283
325,022
138,233
4,176,538
523,852
490,201
1,014,053
21,798
39,920,843
Non-financial companies -
Trade
5,416,938
657,638
8,559
7,002
673,199
53,917
61,395
115,312
4,560
6,210,009
Non-financial companies -
Construction
2,670,497
394,218
6,546
4,854
405,618
248,140
36,340
284,480
2,155
3,362,750
Non-financial companies -
Manufacturing industries
5,483,661
794,421
14,995
6,037
815,453
146,620
82,064
228,684
924
6,528,722
Non-financial companies -
Other activities
2,345,455
305,401
3,469
2,144
311,014
23,924
16,458
40,382
104
2,696,955
Non-financial companies -
Other services
11,342,705
1,426,344
26,573
10,255
1,463,172
304,269
122,502
426,771
2,516
13,235,164
Other Services /Other
activities
22,602,844
303,929
340
1,578
305,847
13,480
15
13,495
\u2014
22,922,186
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Loans to individuals
73,475
80,728
23,210
16,309
120,247
170,990
285,913
456,903
11,365
661,990
Non-financial companies -
Trade
32,985
20,550
1,229
1,136
22,915
17,823
25,364
43,187
269
99,356
Non-financial companies -
Construction
12,726
7,819
1,011
1,247
10,077
113,102
18,993
132,095
\u2014
154,898
Non-financial companies -
Manufacturing industries
39,131
44,277
2,740
1,235
48,252
49,740
40,350
90,090
\u2014
177,473
Non-financial companies -
Other activities
8,248
14,122
291
540
14,953
9,519
9,738
19,257
\u2014
42,458
Non-financial companies -
Other services
70,130
55,033
1,835
1,302
58,170
256,377
50,835
307,212
\u2014
435,512
Other Services /Other
activities
73,276
6,332
15
282
6,629
12,565
9
12,574
\u2014
92,479
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Loans to individuals
34,634,979
3,632,555
301,812
121,924
4,056,291
352,862
204,288
557,150
10,433
39,258,853
Non-financial companies -
Trade
5,383,953
637,088
7,330
5,866
650,284
36,094
36,031
72,125
4,291
6,110,653
Non-financial companies -
Construction
2,657,771
386,399
5,535
3,607
395,541
135,038
17,347
152,385
2,155
3,207,852
Non-financial companies -
Manufacturing industries
5,444,530
750,144
12,255
4,802
767,201
96,880
41,714
138,594
924
6,351,249
Non-financial companies -
Other activities
2,337,207
291,279
3,178
1,604
296,061
14,405
6,720
21,125
104
2,654,497
Non-financial companies -
Other services
11,272,575
1,371,311
24,738
8,953
1,405,002
47,892
71,667
119,559
2,516
12,799,652
Other Services /Other
activities
22,529,568
297,597
325
1,296
299,218
915
6
921
\u2014
22,829,707
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Loans to individuals
0.21%
2.17%
7.14%
11.80%
2.88%
32.64%
58.33%
45.06%
52.14%
1.66%
Non-financial companies -
Trade
0.61%
3.12%
14.36%
16.22%
3.40%
33.06%
41.31%
37.45%
5.90%
1.60%
Non-financial companies -
Construction
0.48%
1.98%
15.44%
25.69%
2.48%
45.58%
52.26%
46.43%
0.00%
4.61%
Non-financial companies -
Manufacturing industries
0.71%
5.57%
18.27%
20.46%
5.92%
33.92%
49.17%
39.39%
0.00%
2.72%
Non-financial companies -
Other activities
0.35%
4.62%
8.39%
25.19%
4.81%
39.79%
59.17%
47.69%
0.00%
1.57%
Non-financial companies -
Other services
0.62%
3.86%
6.91%
12.70%
3.98%
84.26%
41.50%
71.99%
0.00%
3.29%
Other Services /Other
activities
0.32%
2.08%
4.41%
17.87%
2.17%
93.21%
60.00%
93.18%
0.00%
0.40%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025 , financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Geography
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Portugal
64,304,554
5,796,075
166,462
77,972
6,040,509
712,242
333,631
1,045,873
16,598
71,407,534
Poland
26,613,257
1,432,010
234,829
67,639
1,734,478
333,419
384,880
718,299
9,118
29,075,152
Mozambique
1,123,482
794,575
4,157
92,721
891,453
6,769
25,288
32,057
\u2014
2,046,992
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment
Portugal
196,675
190,342
8,916
8,956
208,214
315,589
172,412
488,001
\u2014
892,890
Poland
109,034
53,120
21,033
13,097
87,250
138,838
240,733
379,571
7,660
583,515
Mozambique
6,331
96,621
721
19,510
116,852
3,116
15,100
18,216
\u2014
141,399
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Portugal
64,107,879
5,605,733
157,546
69,016
5,832,295
396,653
161,219
557,872
16,598
70,514,644
Poland
26,504,223
1,378,890
213,796
54,542
1,647,228
194,581
144,147
338,728
1,458
28,491,637
Mozambique
1,117,151
697,954
3,436
73,211
774,601
3,653
10,188
13,841
\u2014
1,905,593
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment
coverage
Portugal
0.31%
3.28%
5.36%
11.49%
3.45%
44.31%
51.68%
46.66%
0.00%
1.25%
Poland
0.41%
3.71%
8.96%
19.36%
5.03%
41.64%
62.55%
52.84%
84.01%
2.01%
Mozambique
0.56%
12.16%
17.34%
21.04%
13.11%
46.03%
59.71%
56.82%
0.00%
6.91%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
58,473,777
5,846,367
216,085
102,395
6,164,847
918,541
356,047
1,274,588
13,881
65,927,093
Poland
24,622,516
1,380,971
160,546
61,255
1,602,772
391,388
420,892
812,280
18,176
27,055,744
Mozambique
1,474,261
367,896
8,873
6,453
383,222
4,273
32,036
36,309
\u2014
1,893,792
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment
Portugal
184,443
174,794
11,245
9,943
195,982
473,433
146,705
620,138
\u2014
1,000,563
Poland
86,667
48,884
18,436
10,769
78,089
155,362
266,152
421,514
11,634
597,904
Mozambique
38,861
5,183
650
1,339
7,172
1,321
18,345
19,666
\u2014
65,699
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Portugal
58,289,334
5,671,573
204,840
92,452
5,968,865
445,108
209,342
654,450
13,881
64,926,530
Poland
24,535,849
1,332,087
142,110
50,486
1,524,683
236,026
154,740
390,766
6,542
26,457,840
Mozambique
1,435,400
362,713
8,223
5,114
376,050
2,952
13,691
16,643
\u2014
1,828,093
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment
coverage
Portugal
0.32%
2.99%
5.20%
9.71%
3.18%
51.54%
41.20%
48.65%
0.00%
1.52%
Poland
0.35%
3.54%
11.48%
17.58%
4.87%
39.70%
63.24%
51.89%
64.01%
2.21%
Mozambique
2.64%
1.41%
7.33%
20.75%
1.87%
30.92%
57.26%
54.16%
0.00%
3.47%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2025
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
61,696,215
9,954,383
2,363,743
6,717
1,763,989
75,785,047
281,615
75,503,432
stage 2
1,226,273
2,864,442
2,112,262
335,072
445,587
6,983,636
388,963
6,594,673
stage 3
400
1,559
398
1,462,354
20,194
1,484,905
793,411
691,494
POCI
3,191
2,339
1,865
17,460
1
24,856
7,660
17,196
62,926,079
12,822,723
4,478,268
1,821,603
2,229,771
84,278,444
1,471,649
82,806,795
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
13,388,007
5,017
\u2014
\u2014
2,539,564
15,932,588
\u2014
15,932,588
stage 2
7,702
74,942
\u2014
\u2014
\u2014
82,644
\u2014
15,932,588
stage 3
\u2014
\u2014
\u2014
\u2014
1,183
1,183
1,183
\u2014
13,395,709
79,959
\u2014
\u2014
2,540,747
16,016,415
1,183
16,015,232
Guarantees and other
commitments (**)
stage 1
11,546,206
3,741,469
687,219
755
280,597
16,256,246
30,425
16,225,821
stage 2
485,675
402,580
410,615
17,358
366,576
1,682,804
23,353
1,659,451
stage 3
3
24
84
311,080
133
311,324
92,377
218,947
POCI
52
1
2
806
\u2014
861
\u2014
861
12,031,936
4,144,074
1,097,920
329,999
647,306
18,251,235
146,155
18,105,080
Total
88,353,724
17,046,756
5,576,188
2,151,602
5,417,824
118,546,094
1,618,987
116,927,107
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2024, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2024
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
54,782,294
9,856,040
2,681,861
620
1,491,131
68,811,946
296,140
68,515,806
stage 2
1,781,656
2,210,946
2,208,958
427,453
324,574
6,953,587
265,982
6,687,605
stage 3
193
1,608
737
1,772,838
25,715
1,801,091
972,371
828,720
POCI
2,700
2,384
1,358
22,792
32
29,266
11,634
17,632
56,566,843
12,070,978
4,892,914
2,223,703
1,841,452
77,595,890
1,546,127
76,049,763
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
12,735,540
\u2014
\u2014
\u2014
137,096
12,872,636
\u2014
12,872,636
stage 3
\u2014
\u2014
\u2014
\u2014
1,169
1,169
1,169
\u2014
12,735,540
\u2014
\u2014
\u2014
138,265
12,873,805
1,169
12,872,636
Guarantees and other
commitments (**)
stage 1
11,380,949
3,218,006
785,001
3
374,649
15,758,608
13,831
15,744,777
stage 2
207,462
408,214
393,070
22,586
165,922
1,197,254
15,261
1,181,993
stage 3
3
19
\u2014
321,943
121
322,086
88,947
233,139
POCI
4
2
1
2,783
\u2014
2,790
\u2014
2,790
11,588,418
3,626,241
1,178,072
347,315
540,692
17,280,738
118,039
17,162,699
Total
80,890,801
15,697,219
6,070,986
2,571,018
2,520,409
107,750,433
1,665,335
106,085,098
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
24,013
30,226,799
30,250,812
7,945
148,082
156,027
Individuals - Other
6,596
12,067,040
12,073,636
3,860
487,200
491,060
Financial Companies
13,833
3,945,052
3,958,885
12,986
25,343
38,329
Non-financial companies-Corporate
154,023
10,619,128
10,773,151
89,870
82,725
172,595
Non-financial companies-SME-
Corporate
261,218
11,364,395
11,625,613
162,761
180,443
343,204
Non-financial companies-SME-Retail
31,409
8,686,803
8,718,212
19,874
220,261
240,135
Non-financial companies-Other
36,352
3,206,297
3,242,649
34,090
11,766
45,856
Other loans
\u2014
21,886,720
21,886,720
\u2014
130,598
130,598
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
28,581
28,654,236
28,682,817
9,285
162,493
171,778
Individuals - Other
8,130
11,229,896
11,238,026
4,839
485,373
490,212
Financial Companies
12,658
3,491,355
3,504,013
12,297
23,793
36,090
Non-financial companies-Corporate
184,831
11,893,979
12,078,810
102,207
68,798
171,005
Non-financial companies-SME-
Corporate
409,804
11,043,023
11,452,827
277,360
166,875
444,235
Non-financial companies -SME - Retail
32,522
7,898,658
7,931,180
61,815
231,692
293,507
Non-financial companies-Other
500
570,283
570,783
272
678
950
Other loans
\u2014
19,418,173
19,418,173
\u2014
56,389
56,389
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
30,609
42,293,839
42,324,448
11,805
635,282
647,087
Non-financial companies-Trade
40,995
6,695,795
6,736,790
22,484
89,485
111,969
Non-financial companies-Construction
154,347
3,639,530
3,793,877
70,384
56,000
126,384
Non-financial companies-Manufacturing
industry
155,378
6,899,729
7,055,107
122,836
128,405
251,241
Non-financial companies-Other activities
13,008
2,836,700
2,849,708
7,981
32,704
40,685
Non-financial companies-Other services
119,274
13,804,869
13,924,143
82,910
188,601
271,511
Other Services/Other activities
13,833
25,831,772
25,845,605
12,986
155,941
168,927
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
36,711
39,884,132
39,920,843
14,124
647,866
661,990
Non-financial companies-Trade
31,532
6,178,477
6,210,009
11,538
87,818
99,356
Non-financial companies-Construction
188,453
3,174,297
3,362,750
110,151
44,747
154,898
Non-financial companies-Manufacturing
industry
101,395
6,427,327
6,528,722
44,047
133,426
177,473
Non-financial companies-Other activities
18,033
2,678,922
2,696,955
11,909
30,549
42,458
Non-financial companies-Other services
288,244
12,946,920
13,235,164
264,009
171,503
435,512
Other Services/Other activities
12,658
22,909,528
22,922,186
12,297
80,182
92,479
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
387,544
71,019,990
71,407,534
279,596
613,294
892,890
Poland
127,879
28,947,273
29,075,152
45,469
538,046
583,515
Mozambique
12,021
2,034,971
2,046,992
6,321
135,078
141,399
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
499,966
65,427,127
65,927,093
411,589
588,974
1,000,563
Poland
163,443
26,892,301
27,055,744
49,694
548,210
597,904
Mozambique
13,617
1,880,175
1,893,792
6,792
58,907
65,699
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
", "dimensions": { "concept": "ifrs-full:DisclosureOfAllowanceForCreditLossesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-679": { "value": "Debt securities
The balance Debt securities is analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Portuguese public issuers
Bonds
625,121
\u2014
Other Portuguese issuers
Bonds
835,421
93,734
Commercial paper
2,363,943
1,681,923
Foreign issuers
Commercial paper
43,710
26,224
3,868,195
1,801,881
Overdue securities - over 90 days
4,449
4,449
3,872,644
1,806,330
Impairment
(48,604)
(7,308)
3,824,040
1,799,022
Debt securities held not associated with credit operations
Bonds issued by public entities (*)
Portuguese issuers
1,326,262
3,135,453
Foreign issuers
19,041,663
15,228,401
Bonds issued by public companies and other entities
Portuguese issuers
\u2014
695,257
Foreign issuers
453,631
539,011
20,821,556
19,598,122
Impairment
(106,721)
(51,973)
20,714,835
19,546,149
24,538,875
21,345,171
( *) Includes the negative amount of EUR 247,549,000 (31\u00a0December 2024: negative amount of EUR 289,655,000) related to adjustments resulting from
the application of fair value hedge accounting.
In 2025, the Bank began to present a set of debt securities which, due to their characteristics, are associated with
credit operations of Portuguese public issuers amounting to EUR 436,256,000, and of Other Portuguese issuers
amounting to EUR 648,370,000.
Under the terms of IFRS 9, the balance Debt securities held associated with credit operations, includes financial
assets classified as loans and advances to customers granted in the form of subscription to issues of Commercial
Paper or Bonds of Corporate and Institutional customers.
Under the terms of IFRS 9, the balance Debt securities held not associated with credit operations - Bonds issued
by public issuers, includes essentially a portfolio of securities to support Group's ALM (Asset and Liability
Management), whose business model seeks to receive the respective income until maturity, that is, of a portfolio
Held to Collect, whose value as at 31\u00a0December 2025 amounts to EUR 13,874,625,000 (31\u00a0December 2024: EUR
12,213,890,000).
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
The analysis of the balance Debt securities before impairment, by maturity, as at 31\u00a0December 2025 is as follows:
(Thousands of euros)
2025
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese public issuers
Bonds
3,986
\u2014
97,741
523,394
\u2014
625,121
Other Portuguese issuers
\u00a0 Bonds
\u2014
\u2014
368,203
467,218
\u2014
835,421
\u00a0 Commercial paper
1,884,412
479,531
\u2014
\u2014
4,449
2,368,392
Foreign issuers
\u00a0 Commercial paper
22,037
21,673
\u2014
\u2014
\u2014
43,710
1,910,435
501,204
465,944
990,612
4,449
3,872,644
Debt securities held not associated
with credit operations
Public entities
\u00a0 Portuguese issuers
\u2014
\u2014
1,326,262
\u2014
\u2014
1,326,262
\u00a0 Foreign issuers
318,800
1,330,251
13,079,514
4,313,098
\u2014
19,041,663
Public companies and other entities
\u00a0 Foreign issuers
\u2014
\u2014
453,631
\u2014
\u2014
453,631
318,800
1,330,251
14,859,407
4,313,098
\u2014
20,821,556
2,229,235
1,831,455
15,325,351
5,303,710
4,449
24,694,200
The analysis of the balance Debt securities before impairment, by maturity, as at 31\u00a0December 2024 is as follows:
(Thousands of euros)
2024
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Other Portuguese issuers
Bonds
\u2014
1,396
10,109
82,229
\u2014
93,734
Commercial paper
1,106,015
575,908
\u2014
\u2014
4,449
1,686,372
Foreign issuers
Commercial paper
23,194
3,030
\u2014
\u2014
\u2014
26,224
1,129,209
580,334
10,109
82,229
4,449
1,806,330
Debt securities held not associated
with credit operations
Public entities
Portuguese issuers
\u2014
374,123
2,110,351
650,979
\u2014
3,135,453
Foreign issuers
30,361
1,273,287
10,230,020
3,694,733
\u2014
15,228,401
Public companies and other entities
Portuguese issuers
\u2014
\u2014
339,206
356,051
\u2014
695,257
Foreign issuers
\u2014
95,419
443,592
\u2014
\u2014
539,011
30,361
1,742,829
13,123,169
4,701,763
\u2014
19,598,122
1,159,570
2,323,163
13,133,278
4,783,992
4,449
21,404,452
The analysis of debt securities portfolio, by sector of activity, is analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Agriculture and forestry
7,487
2,484
Mining
94,879
98,541
Food, beverage and tobacco
168,617
118,851
Textiles
48,510
37,557
Wood and cork
21,366
25,811
Paper, printing and publishing
2,158
6,781
Chemicals
211,298
211,807
Machinery, equipment and basic metallurgical
114,080
67,948
Electricity and gas
385,465
201,886
Water
33,309
35,012
Construction
16,077
8,996
Retail business
45,468
40,359
Wholesale business
153,873
36,583
Restaurants and hotels
15,695
8,946
Transports
74,968
29,659
Services
\u00a0 \u00a0 Financial intermediation
456,163
124,411
\u00a0 \u00a0 Real estate activities
41,665
59,793
\u00a0 \u00a0 Consulting, scientific and technical activities
1,257,003
626,336
\u00a0 \u00a0 Administrative and support services activities
7,486
17,422
\u00a0 \u00a0 Health and collective service activities
3,851
4,960
\u00a0 \u00a0 Artistic, sports and recreational activities
12,352
6,618
\u00a0 \u00a0 Other services
\u2014
2,037
Other international activities
43,709
26,224
3,215,479
1,799,022
Government and Public securities
608,561
\u2014
3,824,040
1,799,022
Debt securities held not associated with credit operations
Machinery, equipment and basic metallurgical
\u2014
24,035
Electricity and gas
\u2014
100,225
Wholesale business
\u2014
100,170
Services
Financial intermediation
453,631
559,873
Consulting, scientific and technical activities
\u2014
447,813
453,631
1,232,116
Government and Public securities
20,261,204
18,314,033
20,714,835
19,546,149
24,538,875
21,345,171
The analysis of restructured debt securities portfolio, by sector of activity, is analysed as follows:
(Thousands of euros)
2025
2024
Restructured
loans
Impairment
Net
amount
Restructured
loans
Impairment
Net
amount
Debt securities held associated
with credit operations
Food, beverage and tobacco
8,422
(168)
8,254
9,279
(205)
9,074
Textiles
252
(17)
235
354
(17)
337
Chemicals
4,449
(4,412)
37
4,449
(3,234)
1,215
Services
Real estate activities
31,431
(29,384)
2,047
\u2014
\u2014
\u2014
Administrative and support
services activities
\u2014
\u2014
\u2014
10,007
(84)
9,923
44,554
(33,981)
10,573
24,089
(3,540)
20,549
The changes occurred in impairment of debt securities are analysed as follows:
(Thousands of euros)
2025
2024
Debt securities held associated with credit operations
Balance as at 1 January
7,308
8,668
Charge for the year in net income interest
548
48
Transfers
45,250
\u2014
Charge for the year (note 11)
1,287
1,691
Reversals for the year (note 11)
(5,788)
(3,099)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
48,604
7,308
Debt securities held not associated with credit operations
Balance as at 1 January
51,973
16,720
Other transfers
(3,429)
940
Charge for the year (note 11)
71,342
35,485
Reversals for the year (note 11)
(6,143)
(2,571)
Amounts charged-off
\u2014
(293)
Exchange rate differences
(7,022)
1,692
Balance at the end of the year
106,721
51,973
The balance Debt securities not associated to credit operations, includes a net reversal recorded at BIM - Banco
Internacional de Mo\u00e7ambique, S.A., in the amount of EUR 63,266,000 (31\u00a0December 2024: EUR 27,157,000),
resulting from the downgrade of Mozambique's public debt, as referred to in note 56.
Non-subordinated debt securities issued
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Bonds
775,249
393,113
Medium term notes (MTN)
2,997,334
2,995,028
Securitisations
91,743
106,331
3,864,326
3,494,472
Corrections to the liabilities value subject to hedging operations
(13,456)
(5,507)
Deferred costs/(gains)
(9,157)
(10,403)
Interests payable
51,880
50,148
3,893,593
3,528,710
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
The characteristics of the bonds issued by the Group, as at 31\u00a0December 2025 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Repayment
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
Bcp 6NC5 Senior Preferred EUR
500MN NG - MTN 856
February, 2021
February, 2027
Fixed rate 1.125% year until
February 2026 /after Euribor
3M+Variable rate 1.55%
500,000
505,746
Bcp 1.75% Eur 500M 6.5Nc5.5
Social Senior Preferred Notes -
Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% year until April
2027/after 2%+Euribor 3M
500,000
492,563
BCP2024 - MTN 862 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due Oct 2029
October, 2024
October, 2029
Fixed rate 3.125% until October
2028; after 0.85%+Euribor 3M
500,000
501,039
BCP2024 - MTN 864 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due Jun 2031
June, 2025
June, 2031
Fixed rate 3.125% until June
2030; after 0.95%+Euribor3M
500,000
499,556
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
90,550
84,162
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
467
434
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
726
674
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05%+1.39% = 19.57%
20,785
21,466
Millennium Leasing CLN 23-38
July, 2023
October, 2038
Wibor 3m 6.85%+11.75% \u00a0= 18.6%
51,861
53,573
Bank Millennium - MILP-2027/09
September, 2023
September,
2027
Fixed rate 9.875%
500,279
519,039
Bank Millennium - BMCN_082036
December, 2023
August, 2036
Wibor 3m 5.85%+12.30%\u00a0=
18.15%
87,856
89,328
Mill Bank Hip 24/06/2027
June, 2024
June, 2027
Wibor 3m 5.85% + 0.57%
70,962
71,152
Bank Millennium - MILP-2029/09
September,
2024
September,
2029
Fixed rate 5.308%
500,462
507,552
Mill Bank Hip 2029/11
November, 2024
November, 2029
Wibor 3m 5.85% + 0.80%
118,217
119,189
Mill Bank Hip 2030/03
March, 2025
March, 2030
Wibor 3m 5.85%
189,122
189,637
Mill Bank Hip 2030/11
November, 2025
November, 2030
Wibor 3m 5,41%
236,446
238,483
3,893,593
As described in note 49, Banco Comercial Portugu\u00eas, S.A. has exercised its option to early redeem all of its
\u201cEUR500,000,000 Senior Preferred Fixed to Floating Rate Notes due October 2026\u201d (ISIN: PTBCP2OM0058), issued
on 2 October 2023 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d).
The characteristics of the bonds issued by the Group, as at 31\u00a0December 2024 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Repayment
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
Bcp 6NC5 Senior Preferred EUR
500MN NG - MTN 856
February, 2021
February, 2027
Fixed rate 1.125% year until
February 2026 /after Euribor
3M+Variable rate 1.55%
500,000
507,523
Bcp 1.75% Eur 500M 6.5Nc5.5 Social
Senior Preferred Notes - Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% year until April
2027/after 2%+Euribor 3M
500,000
481,523
BCP2023 MTN 861 BCP Senior
Preferred Notes OCT 2026
October, 2023
October, 2026
Fixed rate 5.625% until October
2025; after 1.90% + Euribor 3M
500,000
505,931
BCP2024 - MTN 862 - EUR 500M
Senior Preferred Fixed to Floating
Rate Notes due OCT 2029
October, 2024
October, 2029
Fixed rate 3.125% until October
2028; after 0.85%+Euribor 3M
500,000
502,606
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
104,946
97,713
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
542
504
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
841
783
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05%+1.39% = 19.57%
26,602
27,581
Millennium Leasing CLN 23-38
July, 2023
October, 2038
Wibor 3m 6.85%+11.75% \u00a0= 18.6%
65,471
67,776
Bank Millennium - MILP-2027/09
September, 2023
September, 2027
Fixed rate 9.875%
499,009
523,513
Bank Millennium - BMCN_082036
December, 2023
August, 2036
Wibor 3m 5.85%+12.30%\u00a0= 18.15%
114,340
116,445
Mill Bank Hip 24/06/2027
June, 2024
June, 2027
Wibor 3m 5.85% + 0.57%
70,015
70,272
Bank Millennium - MILP-2029/09
September, 2024
September, 2029
Fixed rate 5.308%
499,567
508,641
Mill Bank Hip 2029/11
November, 2024
November, 2029
Wibor 3m 5,85% + 0,80%
116,685
117,899
3,528,710
This balance as at 31\u00a0December 2025 is analysed by the remaining period, as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
6 months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
\u2014
\u2014
\u2014
618,461
164,367
782,828
Medium term notes (MTNs)
\u2014
\u2014
\u2014
2,525,939
499,556
3,025,495
Securitisations
\u2014
\u2014
\u2014
\u2014
85,270
85,270
\u2014
\u2014
\u2014
3,144,400
749,193
3,893,593
This balance as at 31\u00a0December 2024 is analysed by the remaining period, as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
6 months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
\u2014
\u2014
\u2014
188,171
211,802
399,973
Medium term notes (MTNs)
\u2014
\u2014
\u2014
3,029,737
\u2014
3,029,737
Securitisations
\u2014
\u2014
\u2014
\u2014
99,000
99,000
\u2014
\u2014
\u2014
3,217,908
310,802
3,528,710
Banco Comercial Portugu\u00eas, S.A. informed about issue of senior preferred debt
securities eligible for MREL
On 16 June 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBank\u201d) hereby informed that it has set the terms for a new
issue of senior preferred debt securities eligible for MREL (Minimum Requirement for own funds and Eligible
Liabilities), under its Euro Note Programme.
The issue, in the amount of EUR 500 million, will have a tenor of 6 years, with the option of early redemption by the
Bank at the end of year 5, an issue price of 99.631% and an annual interest rate of 3.125% during the first 5 years
(corresponding to a spread of 0.95% over the 5-year mid-swap rate). The interest rate for the year 6 was set at 3-
month Euribor plus a 0.95% spread.
Bank Millennium Minimum requirements for own funds and eligible liabilities (MREL)
Bank Millennium manages MREL indicators in a manner analogous to capital adequacy management.
In terms of the MREL-TREA and MREL-TEM requirements, Bank Millennium Group has a surplus compared to the
minimum required levels as at 31 December 2025, and also meets the MREL-TREA Requirement after the inclusion
of the Combined Buffer Requirement.
MREL
31.12.2025
31.12.2024
MREL-TREA ratio
24.53%
28.06%
Minimum required level MREL-TREA
15.36%
18.03%
Surplus(+) / Deficit(-) of MREL-TREA (p.p.)
9.17 p.p.
10.03 p.p.
Minimum required level including Combined Buffer Requirement (CBR)
19.11%
20.78%
Surplus(+) / Deficit(-) of MREL-TREA+CBR (p.p.)
5.42%
7.28 p.p.
MREL-TEM ratio
8.27%
8.71%
Minimum required level of MREL-TEM
5.91%
5.91%
Surplus(+) / Deficit(-) of MREL-TEM (p.p.)
2.36 p.p.
2.80 p.p.
In May 2025, the Bank received a joint decision of the resolution authorities requiring it to meet the MREL
requirements. The updated minimum requirements are 15.36% (consolidated MREL-TREA) and 5.91% (consolidated
MREL-TEM). Additionally, in relation to the above decisions, the Bank should also meet the MREL requirement
taking into account the Combined Buffer Requirement (currently 3.75%).
Banco Comercial Portugu\u00eas, S.A. informed on the approval of a Share Buyback
Programme
On 8 April 2025, the Bank informed that a share buyback programme in the total amount of EUR 200 million,
equivalent to approximately 2,683%[1] of BCP\u2019s market capitalisation[1] was approved today. The objective of the
BuyBack Programme, for the purposes of Article 5(2)(a) of Regulation (EU) 596/2014, is the cancellation of treasury
shares acquired under its scope and it will be implemented in accordance with the provisions of Regulation (EU)
596/2014, as supplemented by Delegated Regulation (EU) 2016/1052, taking into consideration the terms and
conditions described, and also being conditional to: (i) the limits set out in the resolution adopted under item 6 of
the Agenda of the General Meeting held on 22 May 2024, as duly disclosed to the market; (ii) the terms and
conditions of any future authorisations for the acquisition of treasury shares that may be approved by the General
Meeting of Shareholders of BCP; and (iii) the terms and conditions of any share capital reduction that may be
resolved for these purposes by the General Meeting of Shareholders. On 14 April 2025, the Bank started trading
own shares in the context of the Share BuyBack Programme approved by the Bank in accordance with the terms
and conditions described in the announcement regarding the start of trading under the BuyBack Programme
disclosed by BCP on 8 April 2025.
Banco Comercial Portugu\u00eas, S.A. informed on the termination of rating assignment by
Morningstar DBRS to BCP's Covered Bonds
Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d) hereby informed that, on 1 April 2025, and at its request, ceased the
assignment of rating by Morningstar DBRS to the Covered Bonds issued by BCP.
BCP\u2019s covered bonds maintain the ratings currently assigned by Moody\u2019s and Fitch Ratings, respectively, of \u2018Aaa\u2019
and \u2018AAA\u2019.
Banco Comercial Portugu\u00eas, S.A. informed about the decision to launch a tender offer
on a T2 Notes issue due December 2027
On 13 March 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d) informed it has decided to launch a tender offer (the
\u201cOffer\u201d) in respect to its outstanding EUR300,000,000 4.50% T2 Subordinated Fixed Rate Reset Notes due
December 2027 (ISIN: PTBCPWOM0034) (the \u201cNotes\u201d).
The Offer is conditional on the successful completion of the issuance of a new series of Subordinated Fixed Rate
Reset Notes to be issued off the Banks\u2019 Euro Note Programme, subject to market conditions in amount of at least
EUR 450,000,000 (the \u201cNew Notes\u201d).
When considering allocation of the New Notes, BCP may give preference to those noteholders that, prior to such
allocation, have validly tendered (or have given a firm intention to tender) their Notes for purchase pursuant to the
Offer.
The purpose of the Offer is to proactively manage BCP\u2019s capital structure and debt profile. The Offer also provides
liquidity for investors in the Notes simultaneously with the opportunity to apply for priority allocation in the new
Tier 2 issuance.
Banco Comercial Portugu\u00eas, S.A. informed about issue of Tier 2 Notes
On 13 March 2025, Banco Comercial Portugu\u00eas, S.A. hereby informed, that on the same day, Bank has fixed the
terms for a new issue of subordinated Tier 2 Notes under its Euro Note Programme.
The issue, in the amount of EUR 500 million, will have a tenor of 12 years, with the option of early redemption by
the Bank in the last three months of year 7, an annual interest rate of 4.75% during the first 7 years (corresponding
to a spread of 2.150% (the \u201cSpread\u201d) over the 7-year mid-swap rate). The interest rate for the last 5 years will be
determined on the basis of the then applicable 5-year mid-swap rate plus the Spread.
[1] With reference to the closing price registered in the regulated market Euronext Lisbon on 8 April 2025.
Banco Comercial Portugu\u00eas, S.A. informed about decision to early redeem in full the
EUR 450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 bond issue
On 10 March 2025, Banco Comercial Portugu\u00eas, S.A. informed that it has decided to exercise its option to early
redeem all of its EUR450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 (ISIN: PTBIT3OM0098),
issued on 27 September 2019 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d), in accordance
with condition 6(d) of the terms and conditions of the Notes and the final terms of the Notes. The early
redemption of the Notes shall take place on the optional redemption date set out in the final terms of the Notes,
27 March 2025, at their outstanding principal amount together with accrued interest.
Downgrade of the rating attributed by S&P \u2013 Standard & Poor\u2019s to Mozambique\u2019s
sovereign debt
On 19 February 2025, S&P further downgraded its long-term government debt rating by 1 notch from CCC to CCC-,
due to liquidity challenges and apparent delays in payments to domestic creditors.
On 21 March 2025, S&P downgraded the rating of Mozambique's long-term local currency sovereign debt again
from CCC- to SD (Selective Default).
On 10 October 2025, S&P maintained the aforementioned ratings. This assessment by S&P Global Ratings
reinforces the need for close monitoring of the evolution of Mozambique's sovereign risk.
Banco Comercial Portugu\u00eas, S.A. informed on the co-optation of non-executive
independent Director
On 22 January 2025, Banco Comercial Portugu\u00eas, S.A. informed that its Board of Directors, in accordance with the
law and the Bank's regulations on Succession Planning, today approved the co-optation of Esmeralda da Silva
Santos Dourado as independent non-executive director of the Bank, thus filling the vacancy on the Board of
Directors for the four-year period 2022-2025.
The co-optation was resolved following obtaining authorisation from the European Central Bank to exercise her
functions and will be submitted for ratification at the Bank's next General Meeting.
", "dimensions": { "concept": "ifrs-full:DisclosureOfDebtSecuritiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-682": { "value": "Financial assets at fair value through profit or loss and financial assets at
fair value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred
in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial assets held for trading include bonds issued with different levels of subordination
associated with the traditional securitisation transactions Magellan Mortgages No. 4, referred in note 1 D, in the
amount of EUR 52,000 (31\u00a0December 2024 : EUR 59,000).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The accumulated impairment related to credit risk associated with the financial assets at fair value through other
comprehensive income amounts to EUR 21,062,000 and is recognised against Fair value reserves (31\u00a0December
2024: EUR 16,411,000).
The changes occurred in impairment of financial assets at fair value through other comprehensive income, are
analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,169
1,150
Transfers to fair value changes (note 44)
(6,101)
(10,213)
Impairment through profit and loss (note 12)
10,940
10,255
Reversals through profit and loss (note 12)
(4,839)
(42)
Exchange rate differences
14
19
Balance at the end of the year
1,183
1,169
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2025, is
analysed as follows:
(Thousands of euros)
2025
Amortised
cost (a)
Fair value
hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
487,459
(53,721)
2,226
435,964
Foreign issuers
10,147,142
11,942
52,427
10,211,511
Bonds issued by public companies and other entities
Portuguese issuers
583,555
1,183
5,496
590,234
Foreign issuers
1,514,511
(16,869)
18,005
1,515,647
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
3,258,392
\u2014
3,485
3,261,877
15,991,059
(57,465)
81,639
16,015,233
Equity instruments
Shares
Portuguese companies
24,069
\u2014
(5,452)
18,617
Foreign companies
6,522
\u2014
5,400
11,922
30,591
\u2014
(52)
30,539
16,021,650
(57,465)
81,587
16,045,772
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2024, is
analysed as follows:
(Thousands of euros)
2024
Amortised
cost (a)
Fair value hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
794,782
(42,290)
(12,114)
740,378
Foreign issuers
7,652,045
8,394
10,578
7,671,017
Bonds issued by public companies and other entities
Portuguese issuers
585,957
1,091
1,980
589,028
Foreign issuers
1,408,681
(22,191)
(5,126)
1,381,364
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
137,948
\u2014
107
138,055
Foreign issuers
2,347,811
\u2014
4,984
2,352,795
12,927,224
(54,996)
409
12,872,637
Equity instruments
Shares
Portuguese companies
21,288
\u2014
(5,821)
15,467
Foreign companies
6,092
\u2014
4,770
10,862
27,380
\u2014
(1,051)
26,329
12,954,604
(54,996)
(642)
12,898,966
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Debt instruments - Investment fund units classified as level 3, includes units in restructuring funds
(note 48) which book value resulted from the last disclosure of the Net Asset Value (NAV) determined by the
Management Company, which corresponds to the NAV with reference to that date, after considering the effects of
the last audited accounts for the respective funds. These funds have a diverse set of assets and liabilities, valued in
their respective accounts at fair value through internal methodologies used by the management company.
The instruments classified as level 3 have associated unrealised net gains in the amount of EUR 1,645,000
(31\u00a0December 2024: gains EUR 359,000) recorded in Other comprehensive income. The amount of impairment
created for these securities amounts to EUR 1,183,000 (31\u00a0December 2024: EUR 1,168,000).
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
3,148
187,868
252,096
\u2014
443,112
Foreign issuers
732,837
1,297,978
7,443,263
932,780
\u2014
10,406,858
Bonds issued by public companies
and other entities
Portuguese issuers
72,623
55,092
332,454
130,065
\u2014
590,234
Foreign issuers
9,899
36,264
795,296
675,264
\u2014
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
88,738
301,529
\u2014
\u2014
\u2014
390,267
Foreign issuers
3,038,576
420,773
\u2014
\u2014
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
6,109
6,109
Investment fund units
\u2014
2,141
216,382
\u2014
4,020
222,543
3,942,673
2,116,925
8,975,263
1,990,205
10,129
17,035,195
Equity instruments
Shares
Portuguese companies
39,288
39,288
Foreign companies
48,842
48,842
Investment fund units
67,258
67,258
Other securities
115,370
115,370
270,758
270,758
3,942,673
2,116,925
8,975,263
1,990,205
280,887
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
40,432
357,700
387,594
\u2014
785,726
Foreign issuers
298,761
1,296,334
5,572,040
633,740
\u2014
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
6,351
429,890
152,838
\u2014
589,079
Foreign issuers
23,400
72,236
860,960
425,130
\u2014
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
138,037
846,815
\u2014
\u2014
\u2014
984,852
Foreign issuers
2,231,512
391,990
\u2014
\u2014
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
15,189
15,189
Investment fund units
\u2014
6,756
177,676
32,471
4,203
221,106
2,691,710
2,660,914
7,398,266
1,631,773
19,392
14,402,055
Equity instruments
Shares
Portuguese companies
45,028
45,028
Foreign companies
26,464
26,464
Investment fund units
102,863
102,863
Other securities
87,563
87,563
261,918
261,918
2,691,710
2,660,914
7,398,266
1,631,773
281,310
14,663,973
The balance Loans to customers at fair value correspond essentially to consumer loans. This balance is analysed,
by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
7
4
3 months to 1 year
24
113
1 to 5 years
130
254
Undetermined
17
56
178
427
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
27
\u2014
27
Paper, printing and publishing
50,002
\u2014
\u2014
50,002
Chemicals
18,060
4
\u2014
18,064
Electricity and gas
210,888
\u2014
\u2014
210,888
Water
17,473
\u2014
\u2014
17,473
Construction
6,080
4
\u2014
6,084
Wholesale business
23,065
\u2014
\u2014
23,065
Transports
51,672
\u2014
\u2014
51,672
Telecommunications
69,784
4,670
\u2014
74,454
Services
\u00a0 Financial intermediation
3,959,419
62,694
405,171
4,427,284
\u00a0 Real estate activities
\u2014
20,341
\u2014
20,341
\u00a0 Consulting, scientific and technical activities
62,201
526
\u2014
62,727
\u00a0 Administrative and support services activities
19,886
5,949
\u2014
25,835
\u00a0 Public sector
49,594
\u2014
\u2014
49,594
\u00a0 Health and collective service activities
10,620
\u2014
\u2014
10,620
\u00a0 Other services
1,003
23
\u2014
1,026
Other international activities
\u2014
1
\u2014
1
4,549,747
94,239
405,171
5,049,157
Government and Public securities
12,256,796
\u2014
\u2014
12,256,796
16,806,543
94,239
405,171
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Agriculture and forestry
4,992
\u2014
\u2014
4,992
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
49,225
\u2014
\u2014
49,225
Chemicals
\u2014
5
\u2014
5
Machinery, equipment and basic metallurgical
\u2014
4
\u2014
4
Electricity and gas
181,356
\u2014
\u2014
181,356
Water
17,841
\u2014
\u2014
17,841
Construction
\u2014
3
\u2014
3
Wholesale business
7,192
320
\u2014
7,512
Transports
36,268
\u2014
\u2014
36,268
Telecommunications
43,126
4,413
\u2014
47,539
Services
Financial intermediation
3,569,543
46,281
410,948
4,026,772
Real estate activities
\u2014
\u2014
130
130
Consulting, scientific and technical activities
135,278
29,731
\u2014
165,009
Administrative and support services activities
19,669
5,895
\u2014
25,564
Public sector
49,415
\u2014
454
49,869
Health and collective service activities
10,642
\u2014
\u2014
10,642
Other services
\u2014
22
\u2014
22
Other international activities
\u2014
1
\u2014
1
4,124,547
86,681
411,532
4,622,760
Government and Public securities
10,041,213
\u2014
\u2014
10,041,213
14,165,760
86,681
411,532
14,663,973
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as
follows:
(Thousands of euros)
2025
2024
Financial assets held for trading (note 24)
Debt instruments
791,310
1,259,178
Derivatives
168,266
404,252
Financial assets designated at fair value through profit or loss - Debt instruments (note
24)
\u2014
33,894
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
228,652
236,346
Hedging derivatives (note 25)
32,365
69,349
Total
1,220,593
2,003,019
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialAssetsHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-681": { "value": "Financial assets at fair value through profit or loss and financial assets at
fair value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred
in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial assets held for trading include bonds issued with different levels of subordination
associated with the traditional securitisation transactions Magellan Mortgages No. 4, referred in note 1 D, in the
amount of EUR 52,000 (31\u00a0December 2024 : EUR 59,000).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The accumulated impairment related to credit risk associated with the financial assets at fair value through other
comprehensive income amounts to EUR 21,062,000 and is recognised against Fair value reserves (31\u00a0December
2024: EUR 16,411,000).
The changes occurred in impairment of financial assets at fair value through other comprehensive income, are
analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,169
1,150
Transfers to fair value changes (note 44)
(6,101)
(10,213)
Impairment through profit and loss (note 12)
10,940
10,255
Reversals through profit and loss (note 12)
(4,839)
(42)
Exchange rate differences
14
19
Balance at the end of the year
1,183
1,169
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2025, is
analysed as follows:
(Thousands of euros)
2025
Amortised
cost (a)
Fair value
hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
487,459
(53,721)
2,226
435,964
Foreign issuers
10,147,142
11,942
52,427
10,211,511
Bonds issued by public companies and other entities
Portuguese issuers
583,555
1,183
5,496
590,234
Foreign issuers
1,514,511
(16,869)
18,005
1,515,647
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
3,258,392
\u2014
3,485
3,261,877
15,991,059
(57,465)
81,639
16,015,233
Equity instruments
Shares
Portuguese companies
24,069
\u2014
(5,452)
18,617
Foreign companies
6,522
\u2014
5,400
11,922
30,591
\u2014
(52)
30,539
16,021,650
(57,465)
81,587
16,045,772
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2024, is
analysed as follows:
(Thousands of euros)
2024
Amortised
cost (a)
Fair value hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
794,782
(42,290)
(12,114)
740,378
Foreign issuers
7,652,045
8,394
10,578
7,671,017
Bonds issued by public companies and other entities
Portuguese issuers
585,957
1,091
1,980
589,028
Foreign issuers
1,408,681
(22,191)
(5,126)
1,381,364
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
137,948
\u2014
107
138,055
Foreign issuers
2,347,811
\u2014
4,984
2,352,795
12,927,224
(54,996)
409
12,872,637
Equity instruments
Shares
Portuguese companies
21,288
\u2014
(5,821)
15,467
Foreign companies
6,092
\u2014
4,770
10,862
27,380
\u2014
(1,051)
26,329
12,954,604
(54,996)
(642)
12,898,966
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Debt instruments - Investment fund units classified as level 3, includes units in restructuring funds
(note 48) which book value resulted from the last disclosure of the Net Asset Value (NAV) determined by the
Management Company, which corresponds to the NAV with reference to that date, after considering the effects of
the last audited accounts for the respective funds. These funds have a diverse set of assets and liabilities, valued in
their respective accounts at fair value through internal methodologies used by the management company.
The instruments classified as level 3 have associated unrealised net gains in the amount of EUR 1,645,000
(31\u00a0December 2024: gains EUR 359,000) recorded in Other comprehensive income. The amount of impairment
created for these securities amounts to EUR 1,183,000 (31\u00a0December 2024: EUR 1,168,000).
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
3,148
187,868
252,096
\u2014
443,112
Foreign issuers
732,837
1,297,978
7,443,263
932,780
\u2014
10,406,858
Bonds issued by public companies
and other entities
Portuguese issuers
72,623
55,092
332,454
130,065
\u2014
590,234
Foreign issuers
9,899
36,264
795,296
675,264
\u2014
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
88,738
301,529
\u2014
\u2014
\u2014
390,267
Foreign issuers
3,038,576
420,773
\u2014
\u2014
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
6,109
6,109
Investment fund units
\u2014
2,141
216,382
\u2014
4,020
222,543
3,942,673
2,116,925
8,975,263
1,990,205
10,129
17,035,195
Equity instruments
Shares
Portuguese companies
39,288
39,288
Foreign companies
48,842
48,842
Investment fund units
67,258
67,258
Other securities
115,370
115,370
270,758
270,758
3,942,673
2,116,925
8,975,263
1,990,205
280,887
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
40,432
357,700
387,594
\u2014
785,726
Foreign issuers
298,761
1,296,334
5,572,040
633,740
\u2014
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
6,351
429,890
152,838
\u2014
589,079
Foreign issuers
23,400
72,236
860,960
425,130
\u2014
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
138,037
846,815
\u2014
\u2014
\u2014
984,852
Foreign issuers
2,231,512
391,990
\u2014
\u2014
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
15,189
15,189
Investment fund units
\u2014
6,756
177,676
32,471
4,203
221,106
2,691,710
2,660,914
7,398,266
1,631,773
19,392
14,402,055
Equity instruments
Shares
Portuguese companies
45,028
45,028
Foreign companies
26,464
26,464
Investment fund units
102,863
102,863
Other securities
87,563
87,563
261,918
261,918
2,691,710
2,660,914
7,398,266
1,631,773
281,310
14,663,973
The balance Loans to customers at fair value correspond essentially to consumer loans. This balance is analysed,
by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
7
4
3 months to 1 year
24
113
1 to 5 years
130
254
Undetermined
17
56
178
427
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
27
\u2014
27
Paper, printing and publishing
50,002
\u2014
\u2014
50,002
Chemicals
18,060
4
\u2014
18,064
Electricity and gas
210,888
\u2014
\u2014
210,888
Water
17,473
\u2014
\u2014
17,473
Construction
6,080
4
\u2014
6,084
Wholesale business
23,065
\u2014
\u2014
23,065
Transports
51,672
\u2014
\u2014
51,672
Telecommunications
69,784
4,670
\u2014
74,454
Services
\u00a0 Financial intermediation
3,959,419
62,694
405,171
4,427,284
\u00a0 Real estate activities
\u2014
20,341
\u2014
20,341
\u00a0 Consulting, scientific and technical activities
62,201
526
\u2014
62,727
\u00a0 Administrative and support services activities
19,886
5,949
\u2014
25,835
\u00a0 Public sector
49,594
\u2014
\u2014
49,594
\u00a0 Health and collective service activities
10,620
\u2014
\u2014
10,620
\u00a0 Other services
1,003
23
\u2014
1,026
Other international activities
\u2014
1
\u2014
1
4,549,747
94,239
405,171
5,049,157
Government and Public securities
12,256,796
\u2014
\u2014
12,256,796
16,806,543
94,239
405,171
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Agriculture and forestry
4,992
\u2014
\u2014
4,992
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
49,225
\u2014
\u2014
49,225
Chemicals
\u2014
5
\u2014
5
Machinery, equipment and basic metallurgical
\u2014
4
\u2014
4
Electricity and gas
181,356
\u2014
\u2014
181,356
Water
17,841
\u2014
\u2014
17,841
Construction
\u2014
3
\u2014
3
Wholesale business
7,192
320
\u2014
7,512
Transports
36,268
\u2014
\u2014
36,268
Telecommunications
43,126
4,413
\u2014
47,539
Services
Financial intermediation
3,569,543
46,281
410,948
4,026,772
Real estate activities
\u2014
\u2014
130
130
Consulting, scientific and technical activities
135,278
29,731
\u2014
165,009
Administrative and support services activities
19,669
5,895
\u2014
25,564
Public sector
49,415
\u2014
454
49,869
Health and collective service activities
10,642
\u2014
\u2014
10,642
Other services
\u2014
22
\u2014
22
Other international activities
\u2014
1
\u2014
1
4,124,547
86,681
411,532
4,622,760
Government and Public securities
10,041,213
\u2014
\u2014
10,041,213
14,165,760
86,681
411,532
14,663,973
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
Hedging derivatives
This balance is analysed, by hedging instruments, as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Assets
Liabilities
Swaps
32,365
42,728
69,349
39,041
Hedging derivatives are measured in accordance with internal valuation techniques considering observable
market inputs and, when not available, on information prepared by the Group by extrapolation of market data. In
accordance with the hierarchy of the valuation sources, as referred in IFRS 13, these derivatives are classified in
level 2. The Group resources to derivatives to hedge interest and exchange rate exposure risks. The accounting
method depends on the nature of the hedged risk, namely if the Group is exposed to changes in fair value,
variability in cash flows or highly probable forecast transactions.
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance
with IAS 39, using mainly interest rate and exchange rate derivatives. The fair value hedge model is adopted for
debt securities, loans granted at fixed rate and money market loans and deposits, securities and combined hedge
of variable rate financial assets and fixed rate financial liabilities. The cash flows hedge model is adopted for future
transactions in foreign currency to cover dynamic changes in cash flows from loans granted and variable rate
deposits in foreign currency, and for mortgages in foreign currency.
The relationships that follow the fair value hedge model recorded ineffectiveness in the positive amount of EUR
2,609,000 (31\u00a0December 2024: negative amount of EUR 1,583,000), while hedging relationships that follow the cash
flow hedge model recorded positive ineffectiveness in the amount of EUR 6,000 (31\u00a0December 2024: negative
ineffectiveness of EUR 52 ,000).
Associated with hedge losses, the amount of EUR 321,661,000 (31\u00a0December 2024: EUR 262,845,000) of which EUR
389,944,000 (31\u00a0December 2024: EUR 335,276,000) was amortised from fair value reserves to interest and similar
income and interest and similar expense, relating to cash flow hedge accounting. The accumulated adjustment
on financial risks covered performed on the assets and liabilities which includes hedged items is detailed in note
55.
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining period)
Fair value
Up to
3 months
3 months to
1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The analysis of hedging derivatives portfolio, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining period)
Fair value
Up to
3 months
3 months to 1
year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fair value hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes
OTC Market
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes
OTC Market
Currency and interest rate swap (CIRS)
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to customers, fair value is estimated through internal models based on cash-flow
discounting techniques. Cash-flows for the different instruments sold are calculated according to its financial
characteristics and the discount rates used include both the market interest rate curve and the current conditions
of the Group's pricing policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree
of judgement and reflects exclusively the value attributed to different financial instruments. However, it does not
consider prospective factors, as the future business evolution. Therefore, the values presented cannot be
understood as an estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial
liabilities are presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions
repayable on demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable
estimate of its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and other
funds and Assets with repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future
cash flows for these instruments, considering that the payments of the instalments occur in the contractually
defined dates. This update is made based on the prevailing market rate for the term of each cash flow plus the
average spread of the production of the most recent 3 months of the same. For the elements with signs of
impairment, the net impairment of these operations is considered as a reasonable estimate of their fair value,
considering the economic valuation that is realised in the determination of this impairment.
For Deposits from Central Banks and other funds, it was considered that the book value is a reasonable estimate
of its fair value, given the nature of operations and the associated short-term.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied
by the Group on identical instruments for each of the different residual maturities (rates from the monetary
market or from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to
conditions used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of
its fair value (this class incorporates among other, factoring operations, current account credit, credit cards and
overdrafts in demand deposits).
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined
dates. For loans with signs of impairment (Stage 3 loans), the net impairment of these operations is considered as
a reasonable estimate of their fair value, considering the economic valuation that is realised in the determination
of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes
of this type of instruments and with similar residual maturity. The discount rate includes the market rates for the
residual maturity date (rates from the monetary market or from the interest rate swap market) and the spread
used at the date of the report, which was calculated from the average production of the three most recent
months compared to the reporting date.
Deposits from customers and other funds
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar
maturity. The discount rate includes the market rates of the residual maturity date (rates of monetary market or
the interest rate swap market, at the end of the period) and the actual spread of the Group. This was calculated
from the average production of the three most recent months compared to the reporting date.
As in the case of credits without defined maturity, also for the Deposits from customers without defined maturity
(demand deposits) it is considered that given the potential short term of the same, possibility of their liquidation at
any time, the book value of these liabilities is a reasonable estimate of their fair value.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers,
Deposits from credit institutions and other funds and Deposits from customers and other funds are analysed as
follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives) and financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"),
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
In this class of assets, the fair value corresponds to their book value.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering
the volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the
available models do not fully apply to meet the characteristics of the financial instrument, specific quotations
supplied by an external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt instruments
These financial instruments are accounted at amortised cost net of impairment, as referred in the accounting
policy described in note 1 C1.1.1. The fair value of this class of assets, is based on market prices, whenever these are
available. If market prices are not available, fair value is estimated through numerical models based on cash-flow
discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical
cash-flow discounting techniques and models for assessment of options considering variables of the market,
particularly the interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes. The remaining market inputs, such as yield curves, credit, exchange
rates, among others, are also made available by financial content providers.
Debt securities non-subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet
reflected in the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-
accounting\", the fair value related to the interest rate risk is already recognised. For the fair value calculation, other
components of risk were considered, in addition to the interest rate risk already recorded, when applicable. The
fair value is based on market prices, whenever these are available. If market prices are not available, fair value is
estimated through numerical models based on cash-flow discounting techniques, using the market interest rate
curve adjusted by associated factors, predominantly credit risk and trading margin, the latter only in the case of
issues placed on non-institutional customers of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps
established specifically for each term and class of instruments based on the market prices on equivalent
instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the
cost obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies
used in the determination of the fair value of the issues is analysed as follows:
2025
2024
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
5.41%
0.00%
5.06%
0.00%
Senior
3.01%
0.00%
3.03%
0.00%
Placed in retail
Senior and collateralised
2.90%
3.68%
3.11%
4.94%
For Non-subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of EUR 22,162,000 (31\u00a0December 2024: a
positive amount of EUR 22,410,000) and includes a payable amount of EUR 22,531,000 (31\u00a0December 2024: a
payable amount of EUR 42,477,000) which reflects the fair value of embedded derivatives and are recorded in
financial assets and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2025
2024
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.01%
3.69%
3.73%
5.02%
2.98%
4.45%
4.87%
5.73%
7 days
1.98%
3.73%
3.72%
5.19%
2.98%
4.41%
4.86%
5.73%
1 month
2.03%
3.77%
3.83%
5.23%
2.95%
4.41%
4.80%
5.72%
2 months
2.04%
3.77%
3.89%
5.16%
2.89%
4.42%
4.78%
5.73%
3 months
2.09%
3.81%
3.90%
5.10%
2.81%
4.44%
4.78%
5.74%
6 months
2.16%
3.79%
3.91%
4.88%
2.59%
4.46%
4.79%
5.70%
9 months
2.23%
3.77%
3.92%
4.76%
2.49%
4.48%
4.81%
5.61%
1 year
2.15%
3.68%
3.67%
4.60%
2.33%
4.43%
4.82%
5.62%
2 years
2.23%
3.55%
3.71%
4.21%
2.19%
4.34%
4.51%
5.22%
3 years
2.35%
3.58%
3.83%
4.09%
2.19%
4.32%
4.40%
5.03%
5 years
2.55%
3.70%
3.97%
4.13%
2.24%
4.31%
4.29%
4.99%
7 years
2.71%
3.86%
4.19%
4.25%
2.29%
4.32%
4.26%
5.04%
10 years
2.92%
4.07%
4.49%
4.49%
2.36%
4.34%
4.31%
5.15%
15 years
3.16%
4.37%
4.66%
4.88%
2.42%
4.39%
4.43%
5.31%
20 years
3.26%
4.52%
4.68%
4.87%
2.36%
4.37%
4.49%
5.35%
30 years
3.25%
4.46%
4.72%
4.84%
2.15%
4.21%
4.46%
5.35%
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
4,089,540
4,089,540
4,089,540
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
186,011
186,011
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
861,245
861,245
829,391
Loans and advances to customers (i)
\u2014
\u2014
57,406,675
57,406,675
56,511,413
Debt securities
\u2014
\u2014
24,538,875
24,538,875
24,552,771
Financial assets at fair value
Loans and advances to customers
9,400
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
202,495
10,647,475
\u2014
10,849,970
10,849,970
Bonds issued by public companies and
other entities
1,076
2,105,881
\u2014
2,106,957
2,106,957
Treasury bills
587,739
3,261,877
\u2014
3,849,616
3,849,616
Shares
63,700
30,539
\u2014
94,239
94,239
Investment units
289,801
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
115,370
Trading derivatives
147,302
\u2014
\u2014
147,302
147,302
Hedging derivatives (ii)
32,365
\u2014
\u2014
32,365
32,365
1,449,248
16,045,772
87,082,346
104,577,366
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
878,571
878,571
805,842
Deposits from customers and other funds
\u2014
\u2014
87,672,860
87,672,860
87,663,994
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,893,593
3,893,593
3,915,755
Subordinated debt (i)
\u2014
\u2014
1,411,658
1,411,658
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
2,075,969
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
1,538,366
Short selling securities
8,949
\u2014
\u2014
8,949
8,949
Trading derivatives
143,780
\u2014
\u2014
143,780
143,780
Hedging derivatives (ii)
42,728
\u2014
\u2014
42,728
42,728
3,809,792
\u2014
93,856,682
97,666,474
97,626,912
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group includes in the Book value column of the balance Financial assets at amortised cost - Debt securities
the variation in the fair value of the hedged element attributable to the hedged risk (risk of interest rate) for
securities to which the Group is applying fair value hedge accounting.
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
5,589,030
5,589,030
5,589,030
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
251,157
251,157
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
797,535
797,535
787,632
Loans and advances to customers (i)
\u2014
\u2014
53,907,058
53,907,058
52,984,229
Debt securities
\u2014
\u2014
21,345,171
21,345,171
21,047,438
Financial assets at fair value
Loans and advances to customers
427
\u2014
\u2014
427
427
Bonds issued by public entities
175,206
8,411,395
\u2014
8,586,601
8,586,601
Bonds issued by public companies and
other entities
413
1,970,392
\u2014
1,970,805
1,970,805
Treasury bills
1,117,504
2,490,850
\u2014
3,608,354
3,608,354
Shares
60,352
26,329
\u2014
86,681
86,681
Investment units
323,969
\u2014
\u2014
323,969
323,969
Other securities
87,563
\u2014
\u2014
87,563
87,563
Trading derivatives
387,073
\u2014
\u2014
387,073
387,073
Hedging derivatives (ii)
69,349
\u2014
\u2014
69,349
69,349
2,221,856
12,898,966
81,889,951
97,010,773
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
777,719
777,719
781,443
Deposits from customers and other funds
\u2014
\u2014
82,084,687
82,084,687
81,945,936
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,528,710
3,528,710
3,551,120
Subordinated debt (i)
\u2014
\u2014
1,427,359
1,427,359
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
1,956,851
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
1,292,006
Short selling securities
44,607
\u2014
\u2014
44,607
44,607
Trading derivatives
135,020
\u2014
\u2014
135,020
135,020
Hedging derivatives (ii)
39,041
\u2014
\u2014
39,041
39,041
3,467,525
\u2014
87,818,475
91,286,000
91,236,905
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group classified the financial instruments recorded in the balance sheet at fair value in accordance with the
hierarchy established in IFRS 13. The fair value of financial instruments is determined using quotations recorded in
active and liquid markets, considering that a market is active and liquid whenever its stakeholders conduct
transactions on a regular basis giving liquidity to the instruments traded. When it is verified that there are no
transactions that regularly provide liquidity to the traded instruments, valuation methods and techniques are
used to determine the fair value of the financial instruments.
Level 1 - With quotation in active market
In this category are included, in addition to financial instruments traded on a regulated market, bonds and units of
investment funds valued based on the prices disclosed through trading systems.
The classification of the fair value of level 1 is used when:
i. there is a firm daily enforceable quotation for the financial instruments concerned, or;
ii. there is a quotation available in market information systems that aggregate multiple prices of various
stakeholders.
Level 2 - Valuation methods and techniques based on market data
Financial instruments, when there are no regular transactions in the active and liquid markets (level 1), are
classified in level 2, according to the following rules:
i. failure to comply with the rules defined for level 1, or;
ii. they are valued based on valuation methods and techniques that use mostly observable market data (interest
rate or exchange rate curves, credit curves, etc.).
Level 2 includes over-the-counter derivative financial instruments contracted with counterparties with which the
Group maintains collateral agreements (ISDAs with Credit Support Annex (CSA)). In addition, derivative financial
instruments traded in the over-the-counter market, which, despite not having CSA agreements, the non-
observable market data component (i.e., internal ratings, default probabilities determined by internal models, etc.)
incorporated in the estimation of CVA/DVA is not significant in the overall value of the derivative. In order to assess
the significance of this component, the Group defined a quantitative relevance criterion and performed a
qualitative sensitivity analysis on the valuation component that includes unobservable market data.
Level 3 - Valuation methods and techniques based on data not observable in the
market
If the level 1 or level 2 criteria are not met, financial instruments should be classified in level 3, as well as in
situations where the fair value of financial instruments results from the use of information not observable in the
market, such as:
- financial instruments which are not classified as level 1 and which are valued using evaluation methods and
techniques without being known or where there is consensus on the criteria to be used, namely:
i. - those measured using comparative price analysis of financial instruments with risk and return profile, typology,
seniority or other similar factors, observable in the active and liquid markets;
ii. - those measured using performance indicators of the underlying transactions (e.g. default probability rates of
the underlying assets, delinquency rates, evolution of the ratings, etc.);
iii. - those measured taking as reference the NAV (Net Asset Value) disclosed by the management entities of
securities/real estate/other investment funds not listed on a regulated market.
Level 3 includes over-the-counter derivative financial instruments that have been contracted with counterparties
with which the Group does not maintain collateral exchange agreements, and whose unobservable market data
component incorporated in the estimation of the value adjustment, such as those relating to synthetic
securitisation operations carried out by the Group.
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2025:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
4,089,540
Loans and advances to credit institutions repayable on
demand
186,011
\u2014
\u2014
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
829,391
829,391
Loans and advances to customers
\u2014
\u2014
56,511,413
56,511,413
Debt securities
20,342,177
1,039,152
3,171,442
24,552,771
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
10,811,416
25,224
13,330
10,849,970
Bonds issued by public companies and other entities
1,951,759
155,198
\u2014
2,106,957
Treasury bills
1,345,214
2,504,402
\u2014
3,849,616
Shares
58
\u2014
94,181
94,239
Investment units
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
Trading derivatives
\u2014
124,541
22,761
147,302
Hedging derivatives
\u2014
32,365
\u2014
32,365
38,841,545
3,880,882
60,941,719
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
805,842
805,842
Deposits from customers and other funds
\u2014
\u2014
87,663,994
87,663,994
Non-subordinated debt securities issued
\u2014
\u2014
3,915,755
3,915,755
Subordinated debt
\u2014
\u2014
1,431,529
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
Short selling securities
\u2014
\u2014
8,949
8,949
Trading derivatives
\u2014
120,807
22,973
143,780
Hedging derivatives
\u2014
42,728
\u2014
42,728
1,538,366
163,535
95,925,011
97,626,912
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2024:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
5,589,030
\u2014
\u2014
5,589,030
Loans and advances to credit institutions repayable on
demand
251,157
\u2014
\u2014
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
787,632
787,632
Loans and advances to customers
\u2014
\u2014
52,984,229
52,984,229
Debt securities
17,779,491
462,939
2,805,008
21,047,438
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
427
427
Bonds issued by public entities
8,539,158
26,198
21,245
8,586,601
Bonds issued by public companies and other entities
1,812,602
98,640
59,563
1,970,805
Treasury bills
1,454,611
2,153,743
\u2014
3,608,354
Shares
29,587
\u2014
57,094
86,681
Investment units
\u2014
\u2014
323,969
323,969
Other securities
87,108
\u2014
455
87,563
Trading derivatives
\u2014
109,695
277,378
387,073
Hedging derivatives
\u2014
69,349
\u2014
69,349
35,542,744
2,920,564
57,317,000
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
781,443
781,443
Deposits from customers and other funds
\u2014
\u2014
81,945,936
81,945,936
Non-subordinated debt securities issued
\u2014
\u2014
3,551,120
3,551,120
Subordinated debt
\u2014
\u2014
1,490,881
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
Short selling securities
\u2014
\u2014
44,607
44,607
Trading derivatives
\u2014
91,526
43,494
135,020
Hedging derivatives
\u2014
39,041
\u2014
39,041
1,292,006
130,567
89,814,332
91,236,905
The changes that occurred during 2025 in financial assets and liabilities accounted for at fair value and classified at
level 3, are detailed as follows:
(Thousands of euros)
2025
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
277,832
355,211
107,088
43,494
Gains / (losses) recognised in profit or loss
Net trading income
(72)
3,777
\u2014
(19,946)
Net interest income
\u2014
1,250
24
\u2014
Transfers between levels
(54)
\u2014
(59,463)
\u2014
Capital increases (Investment units)
\u2014
42,065
\u2014
\u2014
Capital reductions (Investment units)
\u2014
(68,651)
\u2014
\u2014
Purchases
22,761
20,712
14,817
442
Sales
(277,706)
(731)
(12,371)
(1,017)
Amortisations
\u2014
(51)
(5,671)
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
2,181
\u2014
Exchange rate differences
\u2014
37
(2,672)
\u2014
Accrued interest
\u2014
\u2014
(62)
\u2014
Balance as at 31 December
22,761
353,619
43,871
22,973
(*) Do not include short sales in the amount of EUR 8,949,000 (note 37).
In 2025, the unobservable inputs included in the valuation of two issues recorded in the portfolio of financial assets
at fair value through other comprehensive income, under the balance Transfers between levels, lost relevance and,
therefore, the securities were classified as level 2 in the fair value hierarchy.
The changes that occurred during 2024 in financial assets and liabilities accounted for at fair value and classified
at level 3, are detailed as follows:
(Thousands of euros)
2024
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
332,705
433,603
101,427
97,994
Gains / (losses) recognised in profit or loss
Net trading income
6,569
1,827
\u2014
(52,808)
Net interest income
31
763
88
\u2014
\u00a0 Impairment
\u2014
(73,891)
\u2014
\u2014
Transfers between portfolios
54
\u2014
\u2014
\u2014
Transfers between levels
\u2014
621
\u2014
\u2014
Capital increases (Investment units)
\u2014
(25,567)
\u2014
\u2014
Capital reductions (Investment units)
14,077
7,873
67,586
695
Purchases
(75,604)
(15,991)
(544)
(2,387)
Sales
\u2014
\u2014
(65,604)
\u2014
Amortisations
\u2014
\u2014
3,600
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
992
\u2014
Exchange rate differences
\u2014
960
(457)
\u2014
Accrued interest
\u2014
25,013
\u2014
\u2014
Balance as at 31 December
277,832
355,211
107,088
43,494
(*) Do not include short sales in the amount of EUR 44,607,000 (note 37).
The balance Transfer between portfolios in the amount of EUR 73,891,000 refers to the classification of Fundo
Turismo Algarve, FCR as associate at the end of 2024.
In 2024, there were no relevant transfers relating to the measurement of financial instruments with respect to
valuation levels.
The Group prepared a sensitivity analysis of the variation in the probability of default by 1 percentage point (2
percentage points for the Caravela 6 operation) at the fair value of the credit default swaps recognised by level 3,
with an estimated impact of around EUR 21,000 (31\u00a0December 2024: EUR 61,000).
The remaining unlisted instruments classified at level 3 are essentially venture capital funds with recognised
valuation based on the information provided by the management entities. The variation of 1% in the quotation
value of these assets impacts the balance sheet value of the same magnitude.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFairValueOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-680": { "value": "Financial assets at fair value through profit or loss and financial assets at
fair value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred
in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial assets held for trading include bonds issued with different levels of subordination
associated with the traditional securitisation transactions Magellan Mortgages No. 4, referred in note 1 D, in the
amount of EUR 52,000 (31\u00a0December 2024 : EUR 59,000).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The accumulated impairment related to credit risk associated with the financial assets at fair value through other
comprehensive income amounts to EUR 21,062,000 and is recognised against Fair value reserves (31\u00a0December
2024: EUR 16,411,000).
The changes occurred in impairment of financial assets at fair value through other comprehensive income, are
analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
1,169
1,150
Transfers to fair value changes (note 44)
(6,101)
(10,213)
Impairment through profit and loss (note 12)
10,940
10,255
Reversals through profit and loss (note 12)
(4,839)
(42)
Exchange rate differences
14
19
Balance at the end of the year
1,183
1,169
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2025, is
analysed as follows:
(Thousands of euros)
2025
Amortised
cost (a)
Fair value
hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
487,459
(53,721)
2,226
435,964
Foreign issuers
10,147,142
11,942
52,427
10,211,511
Bonds issued by public companies and other entities
Portuguese issuers
583,555
1,183
5,496
590,234
Foreign issuers
1,514,511
(16,869)
18,005
1,515,647
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
3,258,392
\u2014
3,485
3,261,877
15,991,059
(57,465)
81,639
16,015,233
Equity instruments
Shares
Portuguese companies
24,069
\u2014
(5,452)
18,617
Foreign companies
6,522
\u2014
5,400
11,922
30,591
\u2014
(52)
30,539
16,021,650
(57,465)
81,587
16,045,772
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31\u00a0December 2024, is
analysed as follows:
(Thousands of euros)
2024
Amortised
cost (a)
Fair value hedge
adjustments
(note 44)
Fair value
adjustments
(note 44)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
794,782
(42,290)
(12,114)
740,378
Foreign issuers
7,652,045
8,394
10,578
7,671,017
Bonds issued by public companies and other entities
Portuguese issuers
585,957
1,091
1,980
589,028
Foreign issuers
1,408,681
(22,191)
(5,126)
1,381,364
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
137,948
\u2014
107
138,055
Foreign issuers
2,347,811
\u2014
4,984
2,352,795
12,927,224
(54,996)
409
12,872,637
Equity instruments
Shares
Portuguese companies
21,288
\u2014
(5,821)
15,467
Foreign companies
6,092
\u2014
4,770
10,862
27,380
\u2014
(1,051)
26,329
12,954,604
(54,996)
(642)
12,898,966
(a) Includes accrued interest and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Debt instruments - Investment fund units classified as level 3, includes units in restructuring funds
(note 48) which book value resulted from the last disclosure of the Net Asset Value (NAV) determined by the
Management Company, which corresponds to the NAV with reference to that date, after considering the effects of
the last audited accounts for the respective funds. These funds have a diverse set of assets and liabilities, valued in
their respective accounts at fair value through internal methodologies used by the management company.
The instruments classified as level 3 have associated unrealised net gains in the amount of EUR 1,645,000
(31\u00a0December 2024: gains EUR 359,000) recorded in Other comprehensive income. The amount of impairment
created for these securities amounts to EUR 1,183,000 (31\u00a0December 2024: EUR 1,168,000).
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
3,148
187,868
252,096
\u2014
443,112
Foreign issuers
732,837
1,297,978
7,443,263
932,780
\u2014
10,406,858
Bonds issued by public companies
and other entities
Portuguese issuers
72,623
55,092
332,454
130,065
\u2014
590,234
Foreign issuers
9,899
36,264
795,296
675,264
\u2014
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
88,738
301,529
\u2014
\u2014
\u2014
390,267
Foreign issuers
3,038,576
420,773
\u2014
\u2014
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
6,109
6,109
Investment fund units
\u2014
2,141
216,382
\u2014
4,020
222,543
3,942,673
2,116,925
8,975,263
1,990,205
10,129
17,035,195
Equity instruments
Shares
Portuguese companies
39,288
39,288
Foreign companies
48,842
48,842
Investment fund units
67,258
67,258
Other securities
115,370
115,370
270,758
270,758
3,942,673
2,116,925
8,975,263
1,990,205
280,887
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at
31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Up to 3
months
3 months to
1 year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
40,432
357,700
387,594
\u2014
785,726
Foreign issuers
298,761
1,296,334
5,572,040
633,740
\u2014
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
6,351
429,890
152,838
\u2014
589,079
Foreign issuers
23,400
72,236
860,960
425,130
\u2014
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
138,037
846,815
\u2014
\u2014
\u2014
984,852
Foreign issuers
2,231,512
391,990
\u2014
\u2014
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
15,189
15,189
Investment fund units
\u2014
6,756
177,676
32,471
4,203
221,106
2,691,710
2,660,914
7,398,266
1,631,773
19,392
14,402,055
Equity instruments
Shares
Portuguese companies
45,028
45,028
Foreign companies
26,464
26,464
Investment fund units
102,863
102,863
Other securities
87,563
87,563
261,918
261,918
2,691,710
2,660,914
7,398,266
1,631,773
281,310
14,663,973
The balance Loans to customers at fair value correspond essentially to consumer loans. This balance is analysed,
by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
7
4
3 months to 1 year
24
113
1 to 5 years
130
254
Undetermined
17
56
178
427
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
27
\u2014
27
Paper, printing and publishing
50,002
\u2014
\u2014
50,002
Chemicals
18,060
4
\u2014
18,064
Electricity and gas
210,888
\u2014
\u2014
210,888
Water
17,473
\u2014
\u2014
17,473
Construction
6,080
4
\u2014
6,084
Wholesale business
23,065
\u2014
\u2014
23,065
Transports
51,672
\u2014
\u2014
51,672
Telecommunications
69,784
4,670
\u2014
74,454
Services
\u00a0 Financial intermediation
3,959,419
62,694
405,171
4,427,284
\u00a0 Real estate activities
\u2014
20,341
\u2014
20,341
\u00a0 Consulting, scientific and technical activities
62,201
526
\u2014
62,727
\u00a0 Administrative and support services activities
19,886
5,949
\u2014
25,835
\u00a0 Public sector
49,594
\u2014
\u2014
49,594
\u00a0 Health and collective service activities
10,620
\u2014
\u2014
10,620
\u00a0 Other services
1,003
23
\u2014
1,026
Other international activities
\u2014
1
\u2014
1
4,549,747
94,239
405,171
5,049,157
Government and Public securities
12,256,796
\u2014
\u2014
12,256,796
16,806,543
94,239
405,171
17,305,953
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at
fair value and trading derivatives) and Financial assets at fair value through other comprehensive income, by
sector of activity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Agriculture and forestry
4,992
\u2014
\u2014
4,992
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
49,225
\u2014
\u2014
49,225
Chemicals
\u2014
5
\u2014
5
Machinery, equipment and basic metallurgical
\u2014
4
\u2014
4
Electricity and gas
181,356
\u2014
\u2014
181,356
Water
17,841
\u2014
\u2014
17,841
Construction
\u2014
3
\u2014
3
Wholesale business
7,192
320
\u2014
7,512
Transports
36,268
\u2014
\u2014
36,268
Telecommunications
43,126
4,413
\u2014
47,539
Services
Financial intermediation
3,569,543
46,281
410,948
4,026,772
Real estate activities
\u2014
\u2014
130
130
Consulting, scientific and technical activities
135,278
29,731
\u2014
165,009
Administrative and support services activities
19,669
5,895
\u2014
25,564
Public sector
49,415
\u2014
454
49,869
Health and collective service activities
10,642
\u2014
\u2014
10,642
Other services
\u2014
22
\u2014
22
Other international activities
\u2014
1
\u2014
1
4,124,547
86,681
411,532
4,622,760
Government and Public securities
10,041,213
\u2014
\u2014
10,041,213
14,165,760
86,681
411,532
14,663,973
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
Financial liabilities designated at fair value through profit or loss
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Deposits from customers (*)
2,075,969
1,956,851
Certificates
1,538,366
1,292,006
3,614,335
3,248,857
(*) Deposits from customers whose remuneration is indexed to a set of shares and/or indices.
As at 31\u00a0December 2025, the analysis of Debt securities at fair value through profit and loss, is as follows:
(Thousands of euros)
2025
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Deposits from customers
714,936
379,480
981,553
\u2014
\u2014
2,075,969
Certificates
\u2014
\u2014
\u2014
\u2014
1,538,366
1,538,366
714,936
379,480
981,553
\u2014
1,538,366
3,614,335
As at 31\u00a0December 2024, the analysis of this balance, by remaining period, is as follows:
(Thousands of euros)
2024
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Deposits from customers
731,697
53,558
790,759
380,837
\u2014
1,956,851
Certificates
\u2014
\u2014
35,748
\u2014
1,256,258
1,292,006
731,697
53,558
826,507
380,837
1,256,258
3,248,857
Transfers of assets
The Group performed a set of transactions of sale of financial assets (namely loans and advances to customers) for
Funds specialised in the recovery of loans. These funds take the responsibility for management of the borrower
companies or assets received as collateral with the objective of ensuring a pro-active management through the
implementation of plans to explore/increase the value of the companies/assets.
The specialised funds in credit recovery that acquired the financial assets are closed funds, in which the holders of
the investment units have no possibility to request the repayment of its investment units throughout the useful
life of the fund. These investment units are held by several banks, which are the sellers of the loans, in percentages
that vary through the useful life of the Funds, ensuring however that, separately, none of the banks hold more
than 50% of the capital of the Fund.
The Funds have a specific management structure (General Partner), fully independent from the assignor banks
and that is selected on the date of establishment of the Fund. The management structure of the Fund has as
main responsibilities to: (i) determine the objective of the Fund and (ii) administrate and manage exclusively the
Fund, determining the objectives and investment policy and the conduct in management and business of the
Fund. The management structure is remunerated through management commissions charged to the Funds.
These funds (in which the Group holds minority positions) establish companies in order to acquire the loans to the
banks, which are financed through the issuance of senior and junior securities. The value of the senior securities
fully subscribed by the Funds that hold the share capital match the fair value of the asset sold, determined in
accordance with a negotiation based on valuations performed by both parties.
The value of the junior securities is equivalent to the difference between the fair value that was based on the
valuation of the senior security and the value of the transferred receivables. These junior securities, being
subscribed by the Group, will entitle the Group to a contingent positive value if the value of the assets transferred
exceeds the amount of the senior tranches plus the remuneration on them. Thus, considering these junior assets
reflect a difference between the valuations of the assets sold based on the appraisals performed by independent
entities and the negotiation between the parties, the Group performs the constitution of impairment losses for all
of them.
Therefore, as a result of the transfer of assets occurred operations, the Group subscribed:
- Senior securities (investment units) of the funds, for which the cash-flows arise mainly from a set of assets
transferred from the participant banks. These securities are booked in Financial assets not held for trading
mandatorily at fair value through profit or loss portfolio and are accounted for at fair value based on the last
available Net assets value (NAV), as disclosed by the Management companies and audited at year end, still being
analysed by the Bank;
- Junior securities (with higher subordination degree) issued by the Portuguese law companies held by the funds
and which are fully provided to reflect the best estimate of impairment of the financial assets transferred.
Within this context, not withholding control but maintaining an exposure to certain risks and rewards, the Group,
in accordance with IFRS 9 3.2 performed an analysis of the exposure to the variability of risks and rewards in the
assets transferred, before and after the transaction, having concluded that it does not hold substantially all the
risks and rewards. Considering that it does not hold control and does not exercise significant influence on the
funds or companies' management, the Group performed, under the scope of IAS IFRS 9 3.2, the derecognition of
the assets transferred and the recognition of the assets received.
The results were calculated on the date of transfer of the assets. During 2025 and 2024, no credits were sold to
corporate restructuring funds.
The amounts accumulated as at 31\u00a0December 2025, related to these operations, are analysed as follows:
(Thousands of euros)
Assets
transferred
Net assets
transferred
Received
value
Net gains
/ (losses)
Fundo Aquarius FCR (a)
132,635
124,723
132,635
7,912
Discovery Real Estate Fund (a)
211,388
152,155
138,187
(13,968)
Fundo Vega FCR (b)
113,665
113,653
109,599
(4,054)
457,688
390,531
380,421
(10,110)
The activity segments are as follows: a) Real estate and tourism; and b) Real estate.
The amounts accumulated as at 31\u00a0December 2024, related to these operations, are analysed as follows:
(Thousands of euros)
Assets
transferred
Net assets
transferred
Received
value
Net gains
/ (losses)
Fundo Recupera\u00e7\u00e3o FCR (in liquidation) (a)
343,266
243,062
232,267
(10,795)
Fundo Aquarius FCR (b)
132,635
124,723
132,635
7,912
Discovery Real Estate Fund (b)
211,388
152,155
138,187
(13,968)
Fundo Vega FCR (c)
113,665
113,653
109,599
(4,054)
800,954
633,593
612,688
(20,905)
The activity segments are as follows: a) Diversified; b) Real estate and tourism; and c) Real estate.
As at 31\u00a0December 2025 and 2024, the assets received under the scope of these operations are comprised of:
(Thousands of euros)
2025
Fair value of
Investment fund
units (note 24)
Shareholder
loans (note 32)
Total
Fundo Aquarius FCR
67,258
\u2014
67,258
Discovery Real Estate Fund
172,953
\u2014
172,953
Fundo Vega FCR
33,923
\u2014
33,923
274,134
\u2014
274,134
(Thousands of euros)
2024
Fair value of
Investment fund
units (note 24)
Shareholder
loans (note 32)
Total
Fundo Recupera\u00e7\u00e3o FCR (in liquidation)
13,987
\u2014
13,987
Fundo Aquarius FCR
88,876
\u2014
88,876
Discovery Real Estate Fund
167,894
\u2014
167,894
Fundo Vega FCR
32,471
\u2014
32,471
303,228
\u2014
303,228
In the last quarter of 2025, the Fundo Recupera\u00e7\u00e3o FCR was sold.
As at 31\u00a0December 2025 and 2024, the book value of investment funds units is recorded under Financial assets not
held for trading mandatorily at fair value through profit or loss (note 24) and considers the Fund's Global Net Asset
Value (NAV) communicated by the Management Companies.
It is also important to mention the following aspects: (i) these are Funds whose latest Audit Reports available as at
31 December 2024 and latest Limited Audit Reports available as at 30 June 2025, do not include reserves. However,
the Fundo Discovery Audit Report, as at 31 December 2024, mentions a \"Material uncertainty related to going
concern\" ; (ii) the funds are subject to supervision by the competent authorities.
The balance Shareholder loans\u00a0 in the gross amount of EUR 100,375,000 (31\u00a0December 2024: EUR 113,840,000) has
recorded an impairment of the same amount (note 32).
The detail of the commitments of subscribed and unpaid capital for each of the corporate restructuring funds is
analysed as follows:
(Thousands of euros)
2025
2024
Corporate restructuring funds
Subscribed
capital
Paid up
capital
realized
Subscribed
and unpaid
capital
Subscribed
capital
Paid up
capital
realized
Subscribed
and unpaid
capital
Fundo Recupera\u00e7\u00e3o FCR (in liquidation)
\u2014
\u2014
\u2014
162,149
162,146
3
Fundo Aquarius FCR
75,862
70,871
4,991
97,739
87,125
10,614
Discovery Real Estate Fund
158,991
158,991
\u2014
158,991
158,991
\u2014
Fundo Vega FCR
45,439
44,169
1,270
45,439
43,825
1,614
280,292
274,031
6,261
464,318
452,087
12,231
There are additional subscription commitments for the fund Discovery, in the amount of EUR 1,107,000
(31\u00a0December 2024: EUR 1,107,000).
Moreover, the following exposures and respective impairment are recorded in the Loans and advances to
customers portfolio and under the Guarantees provided and Irrevocable credit facilities items, in relation to
entities controlled by these funds:
(Thousands of euros)
Items
2025
2024
Loans and advances to customers
5,748
17,416
Guarantees granted and irrevocable credit lines
6,382
22,590
Gross exposure
12,130
40,006
Impairment
(561)
(2,160)
Net exposure
11,569
37,846
Project Crow
As part of the sale process called Project Crow concluded at the end of 2022, Banco Comercial Portugu\u00eas, S.A. now
holds an investment in a venture capital fund, in 2 real estate funds and in a company, as follows:
(Thousands of euros)
2025
2024
Investments in associates (note 26)
Fundo Turismo Algarve, FCR
42,037
41,045
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in liquidation)
16,273
19,175
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo (in liquidation)
1,737
4,305
60,047
64,525
As referred in note 39, there are provisions for liabilities and charges recorded for corporate restructuring funds
and carved-out assets of the Project Crow.
Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to customers, fair value is estimated through internal models based on cash-flow
discounting techniques. Cash-flows for the different instruments sold are calculated according to its financial
characteristics and the discount rates used include both the market interest rate curve and the current conditions
of the Group's pricing policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree
of judgement and reflects exclusively the value attributed to different financial instruments. However, it does not
consider prospective factors, as the future business evolution. Therefore, the values presented cannot be
understood as an estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial
liabilities are presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions
repayable on demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable
estimate of its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and other
funds and Assets with repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future
cash flows for these instruments, considering that the payments of the instalments occur in the contractually
defined dates. This update is made based on the prevailing market rate for the term of each cash flow plus the
average spread of the production of the most recent 3 months of the same. For the elements with signs of
impairment, the net impairment of these operations is considered as a reasonable estimate of their fair value,
considering the economic valuation that is realised in the determination of this impairment.
For Deposits from Central Banks and other funds, it was considered that the book value is a reasonable estimate
of its fair value, given the nature of operations and the associated short-term.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied
by the Group on identical instruments for each of the different residual maturities (rates from the monetary
market or from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to
conditions used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of
its fair value (this class incorporates among other, factoring operations, current account credit, credit cards and
overdrafts in demand deposits).
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined
dates. For loans with signs of impairment (Stage 3 loans), the net impairment of these operations is considered as
a reasonable estimate of their fair value, considering the economic valuation that is realised in the determination
of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes
of this type of instruments and with similar residual maturity. The discount rate includes the market rates for the
residual maturity date (rates from the monetary market or from the interest rate swap market) and the spread
used at the date of the report, which was calculated from the average production of the three most recent
months compared to the reporting date.
Deposits from customers and other funds
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar
maturity. The discount rate includes the market rates of the residual maturity date (rates of monetary market or
the interest rate swap market, at the end of the period) and the actual spread of the Group. This was calculated
from the average production of the three most recent months compared to the reporting date.
As in the case of credits without defined maturity, also for the Deposits from customers without defined maturity
(demand deposits) it is considered that given the potential short term of the same, possibility of their liquidation at
any time, the book value of these liabilities is a reasonable estimate of their fair value.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers,
Deposits from credit institutions and other funds and Deposits from customers and other funds are analysed as
follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives) and financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"),
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
In this class of assets, the fair value corresponds to their book value.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering
the volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the
available models do not fully apply to meet the characteristics of the financial instrument, specific quotations
supplied by an external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt instruments
These financial instruments are accounted at amortised cost net of impairment, as referred in the accounting
policy described in note 1 C1.1.1. The fair value of this class of assets, is based on market prices, whenever these are
available. If market prices are not available, fair value is estimated through numerical models based on cash-flow
discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical
cash-flow discounting techniques and models for assessment of options considering variables of the market,
particularly the interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes. The remaining market inputs, such as yield curves, credit, exchange
rates, among others, are also made available by financial content providers.
Debt securities non-subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet
reflected in the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-
accounting\", the fair value related to the interest rate risk is already recognised. For the fair value calculation, other
components of risk were considered, in addition to the interest rate risk already recorded, when applicable. The
fair value is based on market prices, whenever these are available. If market prices are not available, fair value is
estimated through numerical models based on cash-flow discounting techniques, using the market interest rate
curve adjusted by associated factors, predominantly credit risk and trading margin, the latter only in the case of
issues placed on non-institutional customers of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps
established specifically for each term and class of instruments based on the market prices on equivalent
instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the
cost obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies
used in the determination of the fair value of the issues is analysed as follows:
2025
2024
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
5.41%
0.00%
5.06%
0.00%
Senior
3.01%
0.00%
3.03%
0.00%
Placed in retail
Senior and collateralised
2.90%
3.68%
3.11%
4.94%
For Non-subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of EUR 22,162,000 (31\u00a0December 2024: a
positive amount of EUR 22,410,000) and includes a payable amount of EUR 22,531,000 (31\u00a0December 2024: a
payable amount of EUR 42,477,000) which reflects the fair value of embedded derivatives and are recorded in
financial assets and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2025
2024
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.01%
3.69%
3.73%
5.02%
2.98%
4.45%
4.87%
5.73%
7 days
1.98%
3.73%
3.72%
5.19%
2.98%
4.41%
4.86%
5.73%
1 month
2.03%
3.77%
3.83%
5.23%
2.95%
4.41%
4.80%
5.72%
2 months
2.04%
3.77%
3.89%
5.16%
2.89%
4.42%
4.78%
5.73%
3 months
2.09%
3.81%
3.90%
5.10%
2.81%
4.44%
4.78%
5.74%
6 months
2.16%
3.79%
3.91%
4.88%
2.59%
4.46%
4.79%
5.70%
9 months
2.23%
3.77%
3.92%
4.76%
2.49%
4.48%
4.81%
5.61%
1 year
2.15%
3.68%
3.67%
4.60%
2.33%
4.43%
4.82%
5.62%
2 years
2.23%
3.55%
3.71%
4.21%
2.19%
4.34%
4.51%
5.22%
3 years
2.35%
3.58%
3.83%
4.09%
2.19%
4.32%
4.40%
5.03%
5 years
2.55%
3.70%
3.97%
4.13%
2.24%
4.31%
4.29%
4.99%
7 years
2.71%
3.86%
4.19%
4.25%
2.29%
4.32%
4.26%
5.04%
10 years
2.92%
4.07%
4.49%
4.49%
2.36%
4.34%
4.31%
5.15%
15 years
3.16%
4.37%
4.66%
4.88%
2.42%
4.39%
4.43%
5.31%
20 years
3.26%
4.52%
4.68%
4.87%
2.36%
4.37%
4.49%
5.35%
30 years
3.25%
4.46%
4.72%
4.84%
2.15%
4.21%
4.46%
5.35%
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
4,089,540
4,089,540
4,089,540
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
186,011
186,011
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
861,245
861,245
829,391
Loans and advances to customers (i)
\u2014
\u2014
57,406,675
57,406,675
56,511,413
Debt securities
\u2014
\u2014
24,538,875
24,538,875
24,552,771
Financial assets at fair value
Loans and advances to customers
9,400
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
202,495
10,647,475
\u2014
10,849,970
10,849,970
Bonds issued by public companies and
other entities
1,076
2,105,881
\u2014
2,106,957
2,106,957
Treasury bills
587,739
3,261,877
\u2014
3,849,616
3,849,616
Shares
63,700
30,539
\u2014
94,239
94,239
Investment units
289,801
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
115,370
Trading derivatives
147,302
\u2014
\u2014
147,302
147,302
Hedging derivatives (ii)
32,365
\u2014
\u2014
32,365
32,365
1,449,248
16,045,772
87,082,346
104,577,366
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
878,571
878,571
805,842
Deposits from customers and other funds
\u2014
\u2014
87,672,860
87,672,860
87,663,994
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,893,593
3,893,593
3,915,755
Subordinated debt (i)
\u2014
\u2014
1,411,658
1,411,658
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
2,075,969
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
1,538,366
Short selling securities
8,949
\u2014
\u2014
8,949
8,949
Trading derivatives
143,780
\u2014
\u2014
143,780
143,780
Hedging derivatives (ii)
42,728
\u2014
\u2014
42,728
42,728
3,809,792
\u2014
93,856,682
97,666,474
97,626,912
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group includes in the Book value column of the balance Financial assets at amortised cost - Debt securities
the variation in the fair value of the hedged element attributable to the hedged risk (risk of interest rate) for
securities to which the Group is applying fair value hedge accounting.
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
5,589,030
5,589,030
5,589,030
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
251,157
251,157
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
797,535
797,535
787,632
Loans and advances to customers (i)
\u2014
\u2014
53,907,058
53,907,058
52,984,229
Debt securities
\u2014
\u2014
21,345,171
21,345,171
21,047,438
Financial assets at fair value
Loans and advances to customers
427
\u2014
\u2014
427
427
Bonds issued by public entities
175,206
8,411,395
\u2014
8,586,601
8,586,601
Bonds issued by public companies and
other entities
413
1,970,392
\u2014
1,970,805
1,970,805
Treasury bills
1,117,504
2,490,850
\u2014
3,608,354
3,608,354
Shares
60,352
26,329
\u2014
86,681
86,681
Investment units
323,969
\u2014
\u2014
323,969
323,969
Other securities
87,563
\u2014
\u2014
87,563
87,563
Trading derivatives
387,073
\u2014
\u2014
387,073
387,073
Hedging derivatives (ii)
69,349
\u2014
\u2014
69,349
69,349
2,221,856
12,898,966
81,889,951
97,010,773
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
777,719
777,719
781,443
Deposits from customers and other funds
\u2014
\u2014
82,084,687
82,084,687
81,945,936
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,528,710
3,528,710
3,551,120
Subordinated debt (i)
\u2014
\u2014
1,427,359
1,427,359
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
1,956,851
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
1,292,006
Short selling securities
44,607
\u2014
\u2014
44,607
44,607
Trading derivatives
135,020
\u2014
\u2014
135,020
135,020
Hedging derivatives (ii)
39,041
\u2014
\u2014
39,041
39,041
3,467,525
\u2014
87,818,475
91,286,000
91,236,905
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group classified the financial instruments recorded in the balance sheet at fair value in accordance with the
hierarchy established in IFRS 13. The fair value of financial instruments is determined using quotations recorded in
active and liquid markets, considering that a market is active and liquid whenever its stakeholders conduct
transactions on a regular basis giving liquidity to the instruments traded. When it is verified that there are no
transactions that regularly provide liquidity to the traded instruments, valuation methods and techniques are
used to determine the fair value of the financial instruments.
Level 1 - With quotation in active market
In this category are included, in addition to financial instruments traded on a regulated market, bonds and units of
investment funds valued based on the prices disclosed through trading systems.
The classification of the fair value of level 1 is used when:
i. there is a firm daily enforceable quotation for the financial instruments concerned, or;
ii. there is a quotation available in market information systems that aggregate multiple prices of various
stakeholders.
Level 2 - Valuation methods and techniques based on market data
Financial instruments, when there are no regular transactions in the active and liquid markets (level 1), are
classified in level 2, according to the following rules:
i. failure to comply with the rules defined for level 1, or;
ii. they are valued based on valuation methods and techniques that use mostly observable market data (interest
rate or exchange rate curves, credit curves, etc.).
Level 2 includes over-the-counter derivative financial instruments contracted with counterparties with which the
Group maintains collateral agreements (ISDAs with Credit Support Annex (CSA)). In addition, derivative financial
instruments traded in the over-the-counter market, which, despite not having CSA agreements, the non-
observable market data component (i.e., internal ratings, default probabilities determined by internal models, etc.)
incorporated in the estimation of CVA/DVA is not significant in the overall value of the derivative. In order to assess
the significance of this component, the Group defined a quantitative relevance criterion and performed a
qualitative sensitivity analysis on the valuation component that includes unobservable market data.
Level 3 - Valuation methods and techniques based on data not observable in the
market
If the level 1 or level 2 criteria are not met, financial instruments should be classified in level 3, as well as in
situations where the fair value of financial instruments results from the use of information not observable in the
market, such as:
- financial instruments which are not classified as level 1 and which are valued using evaluation methods and
techniques without being known or where there is consensus on the criteria to be used, namely:
i. - those measured using comparative price analysis of financial instruments with risk and return profile, typology,
seniority or other similar factors, observable in the active and liquid markets;
ii. - those measured using performance indicators of the underlying transactions (e.g. default probability rates of
the underlying assets, delinquency rates, evolution of the ratings, etc.);
iii. - those measured taking as reference the NAV (Net Asset Value) disclosed by the management entities of
securities/real estate/other investment funds not listed on a regulated market.
Level 3 includes over-the-counter derivative financial instruments that have been contracted with counterparties
with which the Group does not maintain collateral exchange agreements, and whose unobservable market data
component incorporated in the estimation of the value adjustment, such as those relating to synthetic
securitisation operations carried out by the Group.
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2025:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
4,089,540
Loans and advances to credit institutions repayable on
demand
186,011
\u2014
\u2014
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
829,391
829,391
Loans and advances to customers
\u2014
\u2014
56,511,413
56,511,413
Debt securities
20,342,177
1,039,152
3,171,442
24,552,771
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
10,811,416
25,224
13,330
10,849,970
Bonds issued by public companies and other entities
1,951,759
155,198
\u2014
2,106,957
Treasury bills
1,345,214
2,504,402
\u2014
3,849,616
Shares
58
\u2014
94,181
94,239
Investment units
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
Trading derivatives
\u2014
124,541
22,761
147,302
Hedging derivatives
\u2014
32,365
\u2014
32,365
38,841,545
3,880,882
60,941,719
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
805,842
805,842
Deposits from customers and other funds
\u2014
\u2014
87,663,994
87,663,994
Non-subordinated debt securities issued
\u2014
\u2014
3,915,755
3,915,755
Subordinated debt
\u2014
\u2014
1,431,529
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
Short selling securities
\u2014
\u2014
8,949
8,949
Trading derivatives
\u2014
120,807
22,973
143,780
Hedging derivatives
\u2014
42,728
\u2014
42,728
1,538,366
163,535
95,925,011
97,626,912
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2024:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
5,589,030
\u2014
\u2014
5,589,030
Loans and advances to credit institutions repayable on
demand
251,157
\u2014
\u2014
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
787,632
787,632
Loans and advances to customers
\u2014
\u2014
52,984,229
52,984,229
Debt securities
17,779,491
462,939
2,805,008
21,047,438
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
427
427
Bonds issued by public entities
8,539,158
26,198
21,245
8,586,601
Bonds issued by public companies and other entities
1,812,602
98,640
59,563
1,970,805
Treasury bills
1,454,611
2,153,743
\u2014
3,608,354
Shares
29,587
\u2014
57,094
86,681
Investment units
\u2014
\u2014
323,969
323,969
Other securities
87,108
\u2014
455
87,563
Trading derivatives
\u2014
109,695
277,378
387,073
Hedging derivatives
\u2014
69,349
\u2014
69,349
35,542,744
2,920,564
57,317,000
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
781,443
781,443
Deposits from customers and other funds
\u2014
\u2014
81,945,936
81,945,936
Non-subordinated debt securities issued
\u2014
\u2014
3,551,120
3,551,120
Subordinated debt
\u2014
\u2014
1,490,881
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
Short selling securities
\u2014
\u2014
44,607
44,607
Trading derivatives
\u2014
91,526
43,494
135,020
Hedging derivatives
\u2014
39,041
\u2014
39,041
1,292,006
130,567
89,814,332
91,236,905
The changes that occurred during 2025 in financial assets and liabilities accounted for at fair value and classified at
level 3, are detailed as follows:
(Thousands of euros)
2025
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
277,832
355,211
107,088
43,494
Gains / (losses) recognised in profit or loss
Net trading income
(72)
3,777
\u2014
(19,946)
Net interest income
\u2014
1,250
24
\u2014
Transfers between levels
(54)
\u2014
(59,463)
\u2014
Capital increases (Investment units)
\u2014
42,065
\u2014
\u2014
Capital reductions (Investment units)
\u2014
(68,651)
\u2014
\u2014
Purchases
22,761
20,712
14,817
442
Sales
(277,706)
(731)
(12,371)
(1,017)
Amortisations
\u2014
(51)
(5,671)
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
2,181
\u2014
Exchange rate differences
\u2014
37
(2,672)
\u2014
Accrued interest
\u2014
\u2014
(62)
\u2014
Balance as at 31 December
22,761
353,619
43,871
22,973
(*) Do not include short sales in the amount of EUR 8,949,000 (note 37).
In 2025, the unobservable inputs included in the valuation of two issues recorded in the portfolio of financial assets
at fair value through other comprehensive income, under the balance Transfers between levels, lost relevance and,
therefore, the securities were classified as level 2 in the fair value hierarchy.
The changes that occurred during 2024 in financial assets and liabilities accounted for at fair value and classified
at level 3, are detailed as follows:
(Thousands of euros)
2024
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
332,705
433,603
101,427
97,994
Gains / (losses) recognised in profit or loss
Net trading income
6,569
1,827
\u2014
(52,808)
Net interest income
31
763
88
\u2014
\u00a0 Impairment
\u2014
(73,891)
\u2014
\u2014
Transfers between portfolios
54
\u2014
\u2014
\u2014
Transfers between levels
\u2014
621
\u2014
\u2014
Capital increases (Investment units)
\u2014
(25,567)
\u2014
\u2014
Capital reductions (Investment units)
14,077
7,873
67,586
695
Purchases
(75,604)
(15,991)
(544)
(2,387)
Sales
\u2014
\u2014
(65,604)
\u2014
Amortisations
\u2014
\u2014
3,600
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
992
\u2014
Exchange rate differences
\u2014
960
(457)
\u2014
Accrued interest
\u2014
25,013
\u2014
\u2014
Balance as at 31 December
277,832
355,211
107,088
43,494
(*) Do not include short sales in the amount of EUR 44,607,000 (note 37).
The balance Transfer between portfolios in the amount of EUR 73,891,000 refers to the classification of Fundo
Turismo Algarve, FCR as associate at the end of 2024.
In 2024, there were no relevant transfers relating to the measurement of financial instruments with respect to
valuation levels.
The Group prepared a sensitivity analysis of the variation in the probability of default by 1 percentage point (2
percentage points for the Caravela 6 operation) at the fair value of the credit default swaps recognised by level 3,
with an estimated impact of around EUR 21,000 (31\u00a0December 2024: EUR 61,000).
The remaining unlisted instruments classified at level 3 are essentially venture capital funds with recognised
valuation based on the information provided by the management entities. The variation of 1% in the quotation
value of these assets impacts the balance sheet value of the same magnitude.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsDesignatedAtFairValueThroughProfitOrLossExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-683": { "value": "
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2025
2024
Financial assets at fair value through profit or loss
Financial assets held for trading
Repurchase agreement transaction
9,222
\u2014
Debt instruments
791,310
1,259,178
Equity instruments
115,430
117,151
Trading derivatives
147,302
387,073
1,063,264
1,763,402
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
178
427
Debt instruments
228,652
236,346
Equity instruments
124,789
118,438
353,619
355,211
\u00a0 Financial assets designated at fair value through profit or loss
\u00a0 Debt instruments
\u2014
33,894
\u2014
33,894
Financial assets at fair value through other comprehensive income
Debt instruments
16,015,233
12,872,637
Equity instruments
30,539
26,329
16,045,772
12,898,966
17,462,655
15,051,473
The balances of Financial assets Held for trading - Repurchase agreement transaction and Financial assets not
held for trading mandatorily at fair value through profit or loss - Loans and advances to customers at fair value are
analysed as follows:
(Thousands of euros)
2025
2024
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Held for
trading
Not held for trading
mandatorily at fair value
through profit or loss
Asset-backed loans
9,222
\u2014
\u2014
\u2014
Unsecured loans
\u2014
161
\u2014
371
9,222
161
\u2014
371
Overdue loans - less than 90 days
\u2014
5
\u2014
24
Overdue loans - Over 90 days
\u2014
12
\u2014
32
9,222
178
\u2014
427
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2025 , is analysed as follows:
(Thousands of euros)
2025
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
7,148
\u2014
\u2014
435,964
443,112
Foreign issuers
195,347
\u2014
\u2014
10,211,511
10,406,858
Bonds issued by public
companies and other entities
Portuguese issuers
\u2014
\u2014
\u2014
590,234
590,234
Foreign issuers
1,076
\u2014
\u2014
1,515,647
1,516,723
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
\u2014
390,267
Foreign issuers
197,472
\u2014
\u2014
3,261,877
3,459,349
Shares of foreign companies (a)
\u2014
6,109
\u2014
\u2014
6,109
Investment units (b)
\u2014
222,543
\u2014
\u2014
222,543
791,310
228,652
\u2014
16,015,233
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
20,671
\u2014
18,617
39,288
Foreign companies
60
36,860
\u2014
11,922
48,842
Investment units (c)
\u2014
67,258
\u2014
\u2014
67,258
Other securities (d)
115,370
\u2014
\u2014
\u2014
115,370
115,430
124,789
\u2014
30,539
270,758
Trading derivatives
147,302
\u2014
\u2014
\u2014
147,302
1,054,042
353,441
\u2014
16,045,772
17,453,255
Level 1
906,688
\u2014
\u2014
13,317,129
14,223,817
Level 2
124,593
\u2014
\u2014
2,684,772
2,809,365
Level 3
22,761
353,441
\u2014
43,871
420,073
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment units are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS
32.
(c) These investment units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 115,370,000 in Exchange Traded Funds (ETFs).
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred
in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial assets held for trading include bonds issued with different levels of subordination
associated with the traditional securitisation transactions Magellan Mortgages No. 4, referred in note 1 D, in the
amount of EUR 52,000 (31\u00a0December 2024 : EUR 59,000).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive income, by type of asset, as at
31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
At fair value through profit or loss
Held for
trading
Not held for
trading
mandatorily at fair
value through
profit or loss
Designated at
fair value
through profit
or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
11,454
\u2014
33,894
740,378
785,726
Foreign issuers
129,858
\u2014
\u2014
7,671,017
7,800,875
Bonds issued by public companies
and other entities
Portuguese issuers
\u2014
51
\u2014
589,028
589,079
Foreign issuers
362
\u2014
\u2014
1,381,364
1,381,726
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
846,797
\u2014
\u2014
138,055
984,852
Foreign issuers
270,707
\u2014
\u2014
2,352,795
2,623,502
Shares of foreign companies (a)
\u2014
15,189
\u2014
\u2014
15,189
Investment units (b)
\u2014
221,106
\u2014
\u2014
221,106
1,259,178
236,346
33,894
12,872,637
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
\u2014
15,467
45,028
Foreign companies
27
15,575
\u2014
10,862
26,464
Investment units (c)
\u2014
102,863
\u2014
\u2014
102,863
Other securities (d)
87,563
\u2014
\u2014
\u2014
87,563
117,151
118,438
\u2014
26,329
261,918
Trading derivatives
387,073
\u2014
\u2014
\u2014
387,073
1,763,402
354,784
33,894
12,898,966
15,051,046
Level 1
1,375,875
\u2014
33,894
10,513,297
11,923,066
Level 2
109,695
\u2014
\u2014
2,278,581
2,388,276
Level 3
277,832
354,784
\u2014
107,088
739,704
(a) These shares are considered as debt instruments because they do not fall within the definition of equity instruments provided by IAS 32.
(b) These investment fund units are considered debt instruments because they do not fall within the definition of equity instruments provided by
IAS 32.
(c) These investment fund units were considered as equity instruments in accordance with the terms provided in IAS 32.
(d) Includes the amount of EUR 87,108,000 in Exchange Traded Funds (ETFs).
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2025, by valuation levels, is analysed as follows:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
417,888
25,224
\u2014
443,112
Foreign issuers
10,393,528
\u2014
13,330
10,406,858
Bonds issued by public companies and other entities
Portuguese issuers
435,088
155,146
\u2014
590,234
Foreign issuers
1,516,671
52
\u2014
1,516,723
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
390,267
\u2014
\u2014
390,267
Foreign issuers
954,947
2,504,402
\u2014
3,459,349
Shares of Foreign companies
\u2014
\u2014
6,109
6,109
Investment units
\u2014
\u2014
222,543
222,543
14,108,389
2,684,824
241,982
17,035,195
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
39,288
39,288
Foreign companies
58
\u2014
48,784
48,842
Investment units
\u2014
\u2014
67,258
67,258
Other securities
115,370
\u2014
\u2014
115,370
115,428
\u2014
155,330
270,758
Trading derivatives
\u2014
124,541
22,761
147,302
14,223,817
2,809,365
420,073
17,453,255
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at
fair value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31\u00a0December
2024, by valuation levels, is analysed as follows:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
759,528
26,198
\u2014
785,726
Foreign issuers
7,779,630
\u2014
21,245
7,800,875
Bonds issued by public companies and other entities
Portuguese issuers
430,876
98,640
59,563
589,079
Foreign issuers
1,381,726
\u2014
\u2014
1,381,726
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
984,852
\u2014
\u2014
984,852
Foreign issuers
469,759
2,153,743
\u2014
2,623,502
Shares of Foreign companies
\u2014
\u2014
15,189
15,189
Investment units
\u2014
\u2014
221,106
221,106
11,806,371
2,278,581
317,103
14,402,055
Equity instruments
Shares
Portuguese companies
29,561
\u2014
15,467
45,028
Foreign companies
26
\u2014
26,438
26,464
Investment units
\u2014
\u2014
102,863
102,863
Other securities
87,108
\u2014
455
87,563
116,695
\u2014
145,223
261,918
Trading derivatives
\u2014
109,695
277,378
387,073
11,923,066
2,388,276
739,704
15,051,046
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2025, is as follows:
(Thousands of euros)
2025
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
225,052
909,492
4,313,216
5,447,760
85,282
83,509
Interest rate options (purchase)
25,970
160,944
357,772
544,686
127
352
Interest rate options (sale)
25,970
160,944
357,773
544,687
308
75
276,992
1,231,380
5,028,761
6,537,133
85,717
83,936
Stock Exchange transactions:
Interest rate futures
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
15,000
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
197,669
232,879
13,049
443,597
6,372
6,066
Currency swaps
1,587,929
841,169
2,493
2,431,591
11,209
25,483
Other spot contracts
92,116
\u2014
\u2014
92,116
\u2014
\u2014
1,877,714
1,074,048
15,542
2,967,304
17,581
31,549
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
109,251
109,251
1,729
1,117
\u2014
\u2014
109,251
109,251
1,729
1,117
Shares/indexes:
OTC Market:
Shares/indexes swaps
689,916
1,361,323
\u2014
2,051,239
11,619
4,211
Shares/indexes options (purchase)
41,476
125,918
84,121
251,515
22,761
\u2014
Shares/indexes options (sale)
247,756
2,751
1,000
251,507
\u2014
22,967
979,148
1,489,992
85,121
2,554,261
34,380
27,178
Stock exchange transactions:
Shares futures
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
1,366,562
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
10
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
123,456
123,456
7,895
\u2014
\u2014
\u2014
123,456
123,456
7,895
\u2014
Total derivatives traded in:
OTC Market
3,133,854
3,795,420
5,362,131
12,291,405
147,302
143,780
of which: Embedded derivatives
\u2014
\u2014
246,294
246,294
\u2014
22,531
Stock Exchange
1,381,572
\u2014
\u2014
1,381,572
\u2014
\u2014
4,515,426
3,795,420
5,362,131
13,672,977
147,302
143,780
The analysis of trading derivatives, by maturity, as at 31\u00a0December 2024, is as follows:
(Thousands of euros)
2024
Notional (remaining term)
Fair value
Up to
3 months
3 months to
1 year
Over 1
year
Total
Assets
Liabilities
(note 37)
Interest rate derivatives:
OTC Market:
Interest rate swaps
350,270
1,432,771
4,307,176
6,090,217
75,859
63,771
Interest rate options (purchase)
\u2014
243,825
75,915
319,740
1,651
\u2014
Interest rate options (sale)
\u2014
243,825
75,916
319,741
1
1,651
350,270
1,920,421
4,459,007
6,729,698
77,511
65,422
Stock Exchange transactions:
Interest rate futures
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
10,700
\u2014
\u2014
Currency derivatives:
OTC Market:
Forward contracts
192,023
148,382
10,523
350,928
1,179
5,572
Currency swaps
1,925,303
234,745
3,629
2,163,677
26,173
7,469
Other spot contracts
78,230
\u2014
\u2014
78,230
\u2014
\u2014
2,195,556
383,127
14,152
2,592,835
27,352
13,041
Currency and interest rate swaps:
OTC Market:
Currency and interest rate swaps:
\u2014
\u2014
100,030
100,030
505
229
\u2014
\u2014
100,030
100,030
505
229
Shares/indexes:
OTC Market:
Shares/indexes swaps
742,820
845,128
314,517
1,902,465
3,498
10,772
Shares/indexes options (purchase)
74,661
128,104
165,284
368,049
42,679
\u2014
Shares/indexes options (sale)
2,808
3,149
362,070
368,027
\u2014
43,489
820,289
976,381
841,871
2,638,541
46,177
54,261
Stock exchange transactions:
Shares futures
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
1,190,125
\u2014
\u2014
Commodity derivatives:
Stock Exchange transactions:
Commodities futures
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
3
\u2014
\u2014
Credit derivatives:
OTC Market:
Credit default swaps (CDS)
\u2014
\u2014
329,356
329,356
235,528
2,067
\u2014
\u2014
329,356
329,356
235,528
2,067
Total derivatives traded in:
OTC Market
3,366,115
3,279,929
5,744,416
12,390,460
387,073
135,020
of which: Embedded derivatives
\u2014
\u2014
360,586
360,586
\u2014
42,477
Stock Exchange
1,200,828
\u2014
\u2014
1,200,828
\u2014
\u2014
4,566,943
3,279,929
5,744,416
13,591,288
387,073
135,020
Financial liabilities held for trading
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Short sales
8,949
44,607
Trading derivatives (note 24)
\u00a0 Swaps
114,320
84,308
\u00a0 Options
23,394
45,140
of which: Embedded derivatives
22,531
42,477
Forwards
6,066
5,572
143,780
135,020
152,729
179,627
Level 2
120,807
91,526
Level 3
31,922
88,101
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial liabilities held for trading includes, as at 31\u00a0December 2025, the embedded derivatives
valuation separated from the host contracts in accordance with the accounting policy presented in note 1 C5. in
the amount of EUR 22,531,000 (31\u00a0December 2024: EUR 42,477,000). This note should be analysed together with
note 24.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-684": { "value": "Investments in associates
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Portuguese credit institutions
54,910
50,153
Foreign credit institutions
124,181
128,829
Other Portuguese companies
277,542
253,146
Other foreign companies
40,684
42,746
497,317
474,874
Impairment
(42,141)
(45,451)
455,176
429,423
The balance Investments in associates, as at 31\u00a0December 2025, is analysed as follows:
(Thousands of euros)
2025
Global value of
investment
Impairment of
investments in
associates
Book value of
investment
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
127,932
\u2014
127,932
Banco Millennium Atl\u00e2ntico, S.A.
70,488
(24,130)
46,358
Banque BCP, S.A.S.
53,693
\u2014
53,693
SIBS, S.G.P.S, S.A.
84,639
\u2014
84,639
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
54,910
\u2014
54,910
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
13,184
\u2014
13,184
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in
liquidation)
16,273
\u2014
16,273
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo
(in liquidation)
1,737
\u2014
1,737
Fundo Turismo Algarve FCR
42,037
\u2014
42,037
Europa Millennium Financial Services Sp. z o.o.
9,155
\u2014
9,155
Nexponor - Sociedade de Investimento Coletivo Imobili\u00e1rio
Fechado, S.A. (in liquidation)
4,924
\u2014
4,924
TIICC S.A.R.L.
334
\u2014
334
Webspectator Corporation
18,011
(18,011)
\u2014
497,317
(42,141)
455,176
These investments refer to entities whose shares are not listed on the stock exchange. According to the
accounting policy described in note 1 B, these investments are measured at the equity method.
The balance Investments in associates, as at 31\u00a0December 2024, is analysed as follows:
(Thousands of euros)
2024
Global value of
investment
Impairment of
investments in
associates
Book value of
investment
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
106,675
\u2014
106,675
Banco Millennium Atl\u00e2ntico, S.A.
74,882
(27,440)
47,442
Banque BCP, S.A.S.
53,947
\u2014
53,947
SIBS, S.G.P.S, S.A.
74,795
\u2014
74,795
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
50,153
\u2014
50,153
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
14,371
\u2014
14,371
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado (in
liquidation)
19,175
\u2014
19,175
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo
(in liquidation)
4,305
\u2014
4,305
Fundo Turismo Algarve FCR
41,045
\u2014
41,045
Europa Millennium Financial Services Sp. z o.o.
10,291
\u2014
10,291
Nexponor - Sociedade de Investimento Coletivo Imobili\u00e1rio
Fechado, S.A. (in liquidation)
7,151
\u2014
7,151
TIICC S.A.R.L.
73
\u2014
73
Webspectator Corporation
18,011
(18,011)
\u2014
474,874
(45,451)
429,423
The Group's companies included in the consolidation scope are presented in note 60, as well as the main
indicators of the most relevant ones.
The movements occurred in Impairment of investments in associates are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
45,451
46,355
Exchange rate differences
(3,310)
(904)
Balance at the end of the year
42,141
45,451
In accordance with the requirements of IFRS 12 and considering their relevance, the movements occurred in the
investment held in Banco Millennium Atl\u00e2ntico, S.A., is analysed as follows:
(Thousands of euros)
2025
2024
Ownership held by BCP on equity of the associate as at 1 January
47,442
47,086
Application of IAS 29 for the year:
Net non-monetary assets of the BMA
Effect of exchange rate variations (note 44)
(525)
(150)
Amortisation of the effect of IAS 29 application calculated as at 31 December 2018 (note
15)
(104)
(182)
Goodwill of investment in BMA
Effect of exchange rate variations (note 44)
(1,368)
(373)
Appropriation of the net income of the associates (note 15)
4,954
4,101
Other comprehensive income attributable to BCP
(182)
(2,167)
Exchange rate differences
Effect on BMA's equity
(5,555)
(1,323)
Goodwill of the investment in BMA
(1,664)
(454)
Impairment of investments in associates (note 44)
3,310
904
Other
50
\u2014
Investment held at the end of the year
46,358
47,442
The following table presents the financial statements of Banco Millennium Atl\u00e2ntico, S.A, prepared in accordance
with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2025
2024
Net income for the year
21,793
18,041
Other comprehensive income
(802)
(9,532)
Total comprehensive income attributable to Shareholders of the associate
20,991
8,509
Application of IAS 29 (*)
(459)
(802)
Attributable to Shareholders of the associates adjusted to BCP GAAP
20,532
7,707
Attributable to the BCP Group
4,668
1,752
Balance sheet
Financial assets
1,875,455
1,797,788
Non-financial assets
246,062
250,391
Financial liabilities
(1,903,127)
(1,824,397)
Non-financial liabilities
(22,068)
(24,236)
Equity attributable to Shareholders of the associates
196,322
199,546
Application of IAS 29 (*)
16,535
19,301
Equity attributable to Shareholders of the associates adjusted to BCP GAAP
212,857
218,847
Equity attributable to the BCP Group
48,392
49,754
Goodwill of the merge
22,096
25,128
Impairment of investments in associates
(24,130)
(27,440)
Equity attributable to the BCP Group adjusted of consolidation items
46,358
47,442
(*) The impact of the IAS 29 adoption was calculated from the date of the merger (April 2016).
The amounts presented do not include adjustments arising from the application of IAS 29. Based on the
requirements of IAS 29, Angola was considered a hyperinflationary economy until 31 December 2018, for the
purpose of presenting the consolidated financial statements, as described in accounting policy 1 B6. This
classification ceased to be applied on 1 January 2019.
In accordance with the requirements of IFRS 12 and considering their relevance, the movements occurred in the
investment held in Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., is analysed as follows:
(Thousands of euros)
2025
2024
Appropriation of equity of the associate on 1 January
106,675
105,675
Appropriation of net income for the year of associates (note 15)
36,144
28,360
Other comprehensive income attributable to BCP
16,473
13,009
Dividends received
(31,360)
(40,369)
Investment held at the end of the year
127,932
106,675
The following table presents the financial statements of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.,
prepared in accordance with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2025
2024
Net income for the year
73,764
61,462
Correction of net income from previous years
\u2014
(3,584)
Other comprehensive income
33,618
26,549
Total comprehensive income attributable to Shareholders of the associate
107,382
84,427
Total comprehensive income attributable to the BCP Group (49%)
52,617
41,369
Balance sheet
Financial assets
8,395,817
7,856,087
Non-financial assets
373,108
435,735
Financial liabilities
(4,165,001)
(4,172,992)
Non-financial liabilities
(4,079,688)
(3,638,209)
Total equity
524,236
480,621
Equity attributable to non-controlling interests
10,663
10,430
Equity attributable to Shareholders of the associates
513,573
470,191
Adjustments of intra-group transactions (*)
378,415
378,415
Equity attributable to Shareholders of the associate adjusted to BCP GAAP
891,988
848,606
Equity attributable to the BCP Group (49%)
437,074
415,817
Reversal of the initial gain in 2004 allocated to the BCP Group
(309,142)
(309,142)
Equity attributable to the BCP Group adjusted of consolidation items
127,932
106,675
(*) Adjustment related to the cancellation in the BCP Group consolidated accounts of the VOBA recorded by Millenniumbcp Ageas Grupo Segurador,
S.G.P.S, S.A., upon initial registration of this investment. VOBA corresponds to the estimated current value of the future cash flows of the contracts in
force at the date of acquisition under IFRS 4. With the implementation of IFRS 17, this concept was cancelled in the consolidated accounts of
Millenniumbcp Ageas having no impact on the Group 's consolidated accounts as it is not recognised in the investment.
Some indicators of the main subsidiaries and associates are analysed as follows:
(Thousands of euros)
2025
2024
Subsidiaries and associates
Total
Assets
Total
Equity
Net
income for
the year
Total
Assets
Total
Equity
Net
income for
the year
Banco Comercial Portugu\u00eas, S.A.
68,304,616
7,245,129
814,652
63,960,815
6,736,196
802,567
Banco ActivoBank, S.A.
5,251,220
423,682
43,413
4,483,473
288,116
34,021
Bank Millennium, S.A. (1)
36,949,277
2,161,034
283,704
32,574,358
1,817,203
167,071
BIM - Banco Internacional de Mo\u00e7ambique,
S.A. (1)
2,689,632
473,615
3,386
3,077,065
537,544
48,469
BCP International B.V.
\u2014
\u2014
(15)
195
177
(733)
BCP Finance Bank, Ltd.
\u2014
\u2014
\u2014
\u2014
\u2014
(536)
BCP \u00c1frica, S.G.P.S., Lda.
288,383
288,366
10,494
286,839
285,710
8,251
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S.,
Sociedade Unipessoal, Lda.
174,701
174,689
(8,421)
188,122
188,110
46,219
Interfundos - Sociedade Gestora de
Organismos de Investimento Coletivo, S.A.
8,017
6,740
594
8,041
6,597
760
Millenniumbcp Ageas Grupo Segurador,
S.G.P.S., S.A. (1)
8,768,925
524,236
73,764
8,291,822
480,621
61,462
Banco Millennium Atl\u00e2ntico, S.A. (2)
2,121,517
196,322
21,793
2,048,179
199,546
18,041
Banque BCP, S.A.S.
5,990,461
283,815
17,267
5,913,938
284,890
15,815
1) Consolidated accounts.
2) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestsInOtherEntitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-686": { "value": "Non-current assets held for sale
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
71,967
(20,826)
51,141
37,643
(12,151)
25,492
Assets belong to investments funds
and real estate companies
5,045
(1,903)
3,142
5,528
(1,900)
3,628
Assets for own use (closed branches)
296
\u2014
296
1,980
(820)
1,160
Equipment and other
4,344
(239)
4,105
4,462
(755)
3,707
Other assets (*)
14,750
(4,506)
10,244
16,985
(5,727)
11,258
96,402
(27,474)
68,928
66,598
(21,353)
45,245
(*) includes Shares, Price Deposit and Property Adjudication Proposals
The assets included in this balance are accounted for in accordance with the accounting policy described in note 1
G.
The balance Real estate - Assets arising from recovered loans includes, essentially, real estate resulted from
process of recovered loans or judicial auction being accounted for at the time the Group assumes control of the
asset, which is usually associated with the transfer of their legal ownership. Additional information on these assets
is presented in note 55.
The Group has a strategy for sale these assets, consistent with the characteristic of each asset as well as with the
breakdown of underlying valuations. However, considering the formal constraints, it was not possible in all
instances to conclude the sales in the expected time. The sale strategy is based in an active search of buyers, with
the Group having a website where advertises these properties and through partnerships with the mediation of
companies having more ability for the product that each time the Group has for sale. Prices are periodically
reviewed and adjusted for continuous adaptation to the market. The Group requests, regularly, to the European
Central Bank, the extension of the period of holding these properties.
This balance includes properties for which the Group has already entered sales contracts in the gross amount of
EUR 2,317,000 (31\u00a0December 2024: EUR 20,244,000 ). The impairment associated with these contracts amounts to
EUR 930,000 (31\u00a0December 2024: EUR 9,201,000).
The changes occurred in Impairment of non-current assets held for sale are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
21,353
52,196
Other transfers
17,797
8,575
Charge for the year (note 13)
1,187
5,722
Reversals for the year (note 13)
(2,158)
(1,398)
Amounts charged-off
(10,474)
(43,808)
Exchange rate differences
(231)
66
Balance at the end of the year
27,474
21,353
", "dimensions": { "concept": "ifrs-full:DisclosureOfNoncurrentAssetsHeldForSaleAndDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-685": { "value": "Non-current assets held for sale
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
71,967
(20,826)
51,141
37,643
(12,151)
25,492
Assets belong to investments funds
and real estate companies
5,045
(1,903)
3,142
5,528
(1,900)
3,628
Assets for own use (closed branches)
296
\u2014
296
1,980
(820)
1,160
Equipment and other
4,344
(239)
4,105
4,462
(755)
3,707
Other assets (*)
14,750
(4,506)
10,244
16,985
(5,727)
11,258
96,402
(27,474)
68,928
66,598
(21,353)
45,245
(*) includes Shares, Price Deposit and Property Adjudication Proposals
The assets included in this balance are accounted for in accordance with the accounting policy described in note 1
G.
The balance Real estate - Assets arising from recovered loans includes, essentially, real estate resulted from
process of recovered loans or judicial auction being accounted for at the time the Group assumes control of the
asset, which is usually associated with the transfer of their legal ownership. Additional information on these assets
is presented in note 55.
The Group has a strategy for sale these assets, consistent with the characteristic of each asset as well as with the
breakdown of underlying valuations. However, considering the formal constraints, it was not possible in all
instances to conclude the sales in the expected time. The sale strategy is based in an active search of buyers, with
the Group having a website where advertises these properties and through partnerships with the mediation of
companies having more ability for the product that each time the Group has for sale. Prices are periodically
reviewed and adjusted for continuous adaptation to the market. The Group requests, regularly, to the European
Central Bank, the extension of the period of holding these properties.
This balance includes properties for which the Group has already entered sales contracts in the gross amount of
EUR 2,317,000 (31\u00a0December 2024: EUR 20,244,000 ). The impairment associated with these contracts amounts to
EUR 930,000 (31\u00a0December 2024: EUR 9,201,000).
The changes occurred in Impairment of non-current assets held for sale are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
21,353
52,196
Other transfers
17,797
8,575
Charge for the year (note 13)
1,187
5,722
Reversals for the year (note 13)
(2,158)
(1,398)
Amounts charged-off
(10,474)
(43,808)
Exchange rate differences
(231)
66
Balance at the end of the year
27,474
21,353
", "dimensions": { "concept": "ifrs-full:DisclosureOfNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-687": { "value": "Investment property
The balance Investment property corresponds to real estate valued in accordance with the accounting policy
presented in note 1 M, based on independent assessments and compliance with legal requirements.
The rents received related to these assets amounted to EUR 856,000 (31\u00a0December 2024: EUR 1,028,000).
The changes occurred in this balance are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
24,183
39,100
Transfers from / (to) to Other assets
(694)
(14,695)
Transfers from / (to) Non-current assets held for sale
(13,697)
\u2014
Revaluations
(2,654)
(222)
Disposals
(2,127)
\u2014
Balance at the end of the year
5,011
24,183
", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentPropertyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-688": { "value": "Other tangible assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Real estate
664,998
675,021
Equipment
Computer equipment
333,933
321,858
Security equipment
64,945
63,919
Facilities
139,543
137,412
Machinery
46,237
47,297
Furniture
76,835
76,733
Vehicles
40,172
38,920
Other equipment
30,007
33,492
Right of use
Real estate
453,273
430,349
Assets under construction
29,729
28,846
Other tangible assets
11
15
1,879,683
1,853,862
Accumulated depreciation
Relative to the current year (note 9)
(105,186)
(102,125)
Relative to the previous years
(1,192,651)
(1,132,398)
(1,297,837)
(1,234,523)
Impairment
\u2014
(193)
581,846
619,146
The balance Real Estate includes the amount of EUR 107,226,000 (31\u00a0December 2024: EUR 107,833,000) related to
real estate held by the Group's real estate investment funds.
The balance Right-of-use corresponds to real estate (branches and central buildings) which are amortised
according to the lease term of each contract, as described in the accounting policy 1 H.
The changes occurred in Other tangible assets during 2025 are analysed as follows:
(Thousands of euros)
2025
Balance as at
1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Real estate
675,021
17
(6,270)
5,122
(8,892)
664,998
Equipment:
Computer equipment
321,858
13,717
(4,110)
7,663
(5,195)
333,933
Security equipment
63,919
574
(180)
1,526
(894)
64,945
Facilities
137,412
2,127
(354)
2,519
(2,161)
139,543
Machinery
47,297
430
(2,909)
1,560
(141)
46,237
Furniture
76,733
595
(921)
1,244
(816)
76,835
Vehicles
38,920
7,534
(5,578)
466
(1,170)
40,172
Other equipment
33,492
37
(5,685)
1,833
330
30,007
Right of use
Real estate
430,349
34,027
(8,805)
(1)
(2,297)
453,273
Assets under construction
28,846
27,923
(1,098)
(25,243)
(699)
29,729
Other tangible assets
15
\u2014
\u2014
\u2014
(4)
11
1,853,862
86,981
(35,910)
(3,311)
(21,939)
1,879,683
Accumulated depreciation
Real estate
(420,458)
(14,537)
4,079
1,529
2,802
(426,585)
Equipment:
Computer equipment
(253,376)
(20,829)
3,692
(125)
4,159
(266,479)
Security equipment
(59,879)
(1,345)
153
\u2014
634
(60,437)
Facilities
(120,356)
(3,458)
307
132
1,380
(121,995)
Machinery
(39,578)
(1,515)
1,904
(401)
84
(39,506)
Furniture
(72,796)
(2,172)
839
457
622
(73,050)
Vehicles
(19,690)
(6,316)
4,573
149
766
(20,518)
Other equipment
(26,773)
(2,055)
5,092
87
(256)
(23,905)
Right of use
Real estate
(221,605)
(52,959)
7,733
(170)
1,650
(265,351)
Other tangible assets
(12)
\u2014
\u2014
\u2014
1
(11)
(1,234,523)
(105,186)
28,372
1,658
11,842
(1,297,837)
619,339
(18,205)
(7,538)
(1,653)
(10,097)
581,846
The changes occurred in Other tangible assets during 2024 are analysed as follows:
(Thousands of euros)
2024
Balance as at
1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Real estate
669,847
92
(4,090)
2,584
6,588
675,021
Equipment:
Computer equipment
346,220
25,487
(62,528)
8,920
3,759
321,858
Security equipment
67,587
442
(5,124)
583
431
63,919
Facilities
151,649
617
(18,029)
2,085
1,090
137,412
Machinery
49,712
542
(5,107)
1,556
594
47,297
Furniture
84,154
539
(9,227)
848
419
76,733
Vehicles
35,839
9,099
(6,865)
\u2014
847
38,920
Other equipment
31,842
17
(714)
1,856
491
33,492
Right of use
Real estate
390,625
42,252
(6,819)
1
4,290
430,349
Assets under construction
20,563
31,888
(362)
(23,919)
676
28,846
Other tangible assets
36
\u2014
(24)
\u2014
3
15
1,848,074
110,975
(118,889)
(5,486)
19,188
1,853,862
Accumulated depreciation
Real estate
(410,455)
(14,769)
3,978
3,524
(2,736)
(420,458)
Equipment:
Computer equipment
(294,471)
(18,347)
62,336
(83)
(2,811)
(253,376)
Security equipment
(63,599)
(1,076)
5,116
\u2014
(320)
(59,879)
Facilities
(134,380)
(3,305)
17,970
66
(707)
(120,356)
Machinery
(42,015)
(1,682)
5,102
(539)
(444)
(39,578)
Furniture
(79,822)
(2,423)
9,196
576
(323)
(72,796)
Vehicles
(19,188)
(5,702)
5,723
8
(531)
(19,690)
Other equipment
(25,101)
(1,994)
705
\u2014
(383)
(26,773)
Right of use
Real estate
(172,560)
(52,827)
6,358
4
(2,580)
(221,605)
Other tangible assets
(36)
\u2014
24
\u2014
\u2014
(12)
(1,241,627)
(102,125)
116,508
3,556
(10,835)
(1,234,523)
606,447
8,850
(2,381)
(1,930)
8,353
619,339
The changes occurred in impairment for tangible fixed assets are analysed as follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
193
\u2014
Charge for the year (note 13)
\u2014
184
Reversals for the year (note 13)
(50)
\u2014
Amounts charged-off
(121)
\u2014
Exchange rate differences
(22)
9
Balance at the end of the year
\u2014
193
", "dimensions": { "concept": "ifrs-full:DisclosureOfPropertyPlantAndEquipmentExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-691": { "value": "Goodwill and intangible assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
113,808
112,374
Euro Bank, S.A. (Poland)
45,497
44,924
Other
10,155
10,193
169,460
167,491
Impairment
Bank Millennium, S.A. (Poland)
(113,808)
(112,374)
Other
(9,880)
(9,880)
(123,688)
(122,254)
45,772
45,237
Intangible assets
Software
349,976
291,642
Software - in progress
83,321
71,726
Other intangible assets
59,718
49,797
493,015
413,165
Accumulated amortisation
Charge for the year (note 9)
(50,548)
(42,675)
Charge for the previous years
(165,556)
(139,757)
(216,104)
(182,432)
276,911
230,733
322,683
275,970
According to the accounting policy described in note 1 B, the recoverable amount of the Goodwill is annually
assessed in the second half of each year or whenever there are indications of eventual loss of value. In accordance
with IAS 36 the recoverable amount of goodwill resulting from the consolidation of the subsidiaries, should be the
greater between its value in use (the present value of the future cash flows expected from its use) and its fair value
less costs to sell. Based on these criteria, the Group made in 2025, valuations of their investments for which there is
goodwill recognised considering among other factors:
(i) an estimate of future cash flows generated by each cash generating unit;
(ii) an expectation of potential changes in the amounts and timing of cash flows;
(iii) the time value of money;
(iv) a risk premium associated with the uncertainty by holding the asset; and
(v) other factors associated with the current situation of financial markets.
The valuations are based on reasonable and sustainable assumptions representing the best estimate of the
Executive Committee on the economic conditions that affect each subsidiary, the budgets and the latest forecasts
approved for those subsidiaries and their extrapolation to future periods. The assumptions made for these
valuations might vary with the change in economic conditions and in the market.
In 2025, there were no factors pointing to the deterioration of the value of those financial participations that could
lead to impairment charges in respect of goodwill.
Goodwill of Euro Bank, S.A. in the accounts of Bank Millennium, S.A. (Poland)
As a result of the purchase by Bank Millennium of 99.787% of shares of Euro Bank S.A. from SG Financial Services
Holdings, a 100% subsidiary of Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A., and the subsequent merger with the above-mentioned entity
in 2019, the difference in the fair value of the acquired assets and liabilities as at the acquisition date to the
purchase price was determined and, in accordance with the provisions of IFRS 3.32, was recognised as goodwill in
intangible assets (assigned to retail activities).
With respect to goodwill, an impairment test is performed at least once a year, regardless of any indication that
impairment may have occurred.
The input data for the goodwill test include the result on retail assets and liabilities allocated to Cash Generating
Units. To determine the amount of capital, an estimate of risk-weighted assets and a capital adequacy ratio that
meets regulatory minimums for the business were used. The test is performed by comparing the present value of
cash flows generated by the listed assets with the estimated amount of capital. Cash flow forecasts have been
prepared based on management's assumptions about all the conditions that will occur over the remaining useful
lives of the assets. They are consistent with the medium-term financial plan adopted by the Bank for 2026-2028
and the Bank's Strategy. Data for subsequent years after 2028 are the result of extrapolation of forecasts assuming
continued changes in the balance sheet and income statement and applying a residual value growth rate of 3%.
Cash flows were discounted using a cost of capital of approximately 12%, consisting of the market rate plus a risk
premium.
The test, executed as at the end of 2025, showed a surplus of the current value of cash flows over the net book
value of the cash-generating unit and therefore no impairment was found for this unit.
The changes occurred in Goodwill and intangible assets, during 2025, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
167,491
\u2014
\u2014
\u2014
1,969
169,460
Impairment
(122,254)
\u2014
\u2014
\u2014
(1,434)
(123,688)
45,237
\u2014
\u2014
\u2014
535
45,772
Intangible assets
Software
291,642
25,757
(13,669)
50,689
(4,443)
349,976
Software - in progress
71,726
72,395
(325)
(60,746)
271
83,321
Other intangible assets
49,797
181
(955)
10,043
652
59,718
413,165
98,333
(14,949)
(14)
(3,520)
493,015
Accumulated amortisation
Software
(149,965)
(43,019)
13,636
140
2,892
(176,316)
Other intangible assets
(32,467)
(7,529)
769
(140)
(421)
(39,788)
(182,432)
(50,548)
14,405
\u2014
2,471
(216,104)
230,733
47,785
(544)
(14)
(1,049)
276,911
275,970
47,785
(544)
(14)
(514)
322,683
The changes occurred in Goodwill and intangible assets, during 2024, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
165,043
\u2014
\u2014
\u2014
2,448
167,491
Impairment
(120,520)
\u2014
\u2014
\u2014
(1,734)
(122,254)
44,523
\u2014
\u2014
\u2014
714
45,237
Intangible assets
Software
243,546
23,969
(27,523)
47,725
3,925
291,642
Software - in progress
66,230
69,410
(218)
(64,566)
870
71,726
Other intangible assets
80,598
\u2014
(48,783)
16,928
1,054
49,797
390,374
93,379
(76,524)
87
5,849
413,165
Accumulated amortisation
Software
(138,508)
(35,632)
26,919
44
(2,788)
(149,965)
Other intangible assets
(73,284)
(7,043)
48,783
(44)
(879)
(32,467)
(211,792)
(42,675)
75,702
\u2014
(3,667)
(182,432)
178,582
50,704
(822)
87
2,182
230,733
223,105
50,704
(822)
87
2,896
275,970
", "dimensions": { "concept": "ifrs-full:DisclosureOfResearchAndDevelopmentExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-690": { "value": "Goodwill and intangible assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
113,808
112,374
Euro Bank, S.A. (Poland)
45,497
44,924
Other
10,155
10,193
169,460
167,491
Impairment
Bank Millennium, S.A. (Poland)
(113,808)
(112,374)
Other
(9,880)
(9,880)
(123,688)
(122,254)
45,772
45,237
Intangible assets
Software
349,976
291,642
Software - in progress
83,321
71,726
Other intangible assets
59,718
49,797
493,015
413,165
Accumulated amortisation
Charge for the year (note 9)
(50,548)
(42,675)
Charge for the previous years
(165,556)
(139,757)
(216,104)
(182,432)
276,911
230,733
322,683
275,970
According to the accounting policy described in note 1 B, the recoverable amount of the Goodwill is annually
assessed in the second half of each year or whenever there are indications of eventual loss of value. In accordance
with IAS 36 the recoverable amount of goodwill resulting from the consolidation of the subsidiaries, should be the
greater between its value in use (the present value of the future cash flows expected from its use) and its fair value
less costs to sell. Based on these criteria, the Group made in 2025, valuations of their investments for which there is
goodwill recognised considering among other factors:
(i) an estimate of future cash flows generated by each cash generating unit;
(ii) an expectation of potential changes in the amounts and timing of cash flows;
(iii) the time value of money;
(iv) a risk premium associated with the uncertainty by holding the asset; and
(v) other factors associated with the current situation of financial markets.
The valuations are based on reasonable and sustainable assumptions representing the best estimate of the
Executive Committee on the economic conditions that affect each subsidiary, the budgets and the latest forecasts
approved for those subsidiaries and their extrapolation to future periods. The assumptions made for these
valuations might vary with the change in economic conditions and in the market.
In 2025, there were no factors pointing to the deterioration of the value of those financial participations that could
lead to impairment charges in respect of goodwill.
Goodwill of Euro Bank, S.A. in the accounts of Bank Millennium, S.A. (Poland)
As a result of the purchase by Bank Millennium of 99.787% of shares of Euro Bank S.A. from SG Financial Services
Holdings, a 100% subsidiary of Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A., and the subsequent merger with the above-mentioned entity
in 2019, the difference in the fair value of the acquired assets and liabilities as at the acquisition date to the
purchase price was determined and, in accordance with the provisions of IFRS 3.32, was recognised as goodwill in
intangible assets (assigned to retail activities).
With respect to goodwill, an impairment test is performed at least once a year, regardless of any indication that
impairment may have occurred.
The input data for the goodwill test include the result on retail assets and liabilities allocated to Cash Generating
Units. To determine the amount of capital, an estimate of risk-weighted assets and a capital adequacy ratio that
meets regulatory minimums for the business were used. The test is performed by comparing the present value of
cash flows generated by the listed assets with the estimated amount of capital. Cash flow forecasts have been
prepared based on management's assumptions about all the conditions that will occur over the remaining useful
lives of the assets. They are consistent with the medium-term financial plan adopted by the Bank for 2026-2028
and the Bank's Strategy. Data for subsequent years after 2028 are the result of extrapolation of forecasts assuming
continued changes in the balance sheet and income statement and applying a residual value growth rate of 3%.
Cash flows were discounted using a cost of capital of approximately 12%, consisting of the market rate plus a risk
premium.
The test, executed as at the end of 2025, showed a surplus of the current value of cash flows over the net book
value of the cash-generating unit and therefore no impairment was found for this unit.
The changes occurred in Goodwill and intangible assets, during 2025, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
167,491
\u2014
\u2014
\u2014
1,969
169,460
Impairment
(122,254)
\u2014
\u2014
\u2014
(1,434)
(123,688)
45,237
\u2014
\u2014
\u2014
535
45,772
Intangible assets
Software
291,642
25,757
(13,669)
50,689
(4,443)
349,976
Software - in progress
71,726
72,395
(325)
(60,746)
271
83,321
Other intangible assets
49,797
181
(955)
10,043
652
59,718
413,165
98,333
(14,949)
(14)
(3,520)
493,015
Accumulated amortisation
Software
(149,965)
(43,019)
13,636
140
2,892
(176,316)
Other intangible assets
(32,467)
(7,529)
769
(140)
(421)
(39,788)
(182,432)
(50,548)
14,405
\u2014
2,471
(216,104)
230,733
47,785
(544)
(14)
(1,049)
276,911
275,970
47,785
(544)
(14)
(514)
322,683
The changes occurred in Goodwill and intangible assets, during 2024, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
165,043
\u2014
\u2014
\u2014
2,448
167,491
Impairment
(120,520)
\u2014
\u2014
\u2014
(1,734)
(122,254)
44,523
\u2014
\u2014
\u2014
714
45,237
Intangible assets
Software
243,546
23,969
(27,523)
47,725
3,925
291,642
Software - in progress
66,230
69,410
(218)
(64,566)
870
71,726
Other intangible assets
80,598
\u2014
(48,783)
16,928
1,054
49,797
390,374
93,379
(76,524)
87
5,849
413,165
Accumulated amortisation
Software
(138,508)
(35,632)
26,919
44
(2,788)
(149,965)
Other intangible assets
(73,284)
(7,043)
48,783
(44)
(879)
(32,467)
(211,792)
(42,675)
75,702
\u2014
(3,667)
(182,432)
178,582
50,704
(822)
87
2,182
230,733
223,105
50,704
(822)
87
2,896
275,970
", "dimensions": { "concept": "ifrs-full:DisclosureOfGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-689": { "value": "Goodwill and intangible assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
113,808
112,374
Euro Bank, S.A. (Poland)
45,497
44,924
Other
10,155
10,193
169,460
167,491
Impairment
Bank Millennium, S.A. (Poland)
(113,808)
(112,374)
Other
(9,880)
(9,880)
(123,688)
(122,254)
45,772
45,237
Intangible assets
Software
349,976
291,642
Software - in progress
83,321
71,726
Other intangible assets
59,718
49,797
493,015
413,165
Accumulated amortisation
Charge for the year (note 9)
(50,548)
(42,675)
Charge for the previous years
(165,556)
(139,757)
(216,104)
(182,432)
276,911
230,733
322,683
275,970
According to the accounting policy described in note 1 B, the recoverable amount of the Goodwill is annually
assessed in the second half of each year or whenever there are indications of eventual loss of value. In accordance
with IAS 36 the recoverable amount of goodwill resulting from the consolidation of the subsidiaries, should be the
greater between its value in use (the present value of the future cash flows expected from its use) and its fair value
less costs to sell. Based on these criteria, the Group made in 2025, valuations of their investments for which there is
goodwill recognised considering among other factors:
(i) an estimate of future cash flows generated by each cash generating unit;
(ii) an expectation of potential changes in the amounts and timing of cash flows;
(iii) the time value of money;
(iv) a risk premium associated with the uncertainty by holding the asset; and
(v) other factors associated with the current situation of financial markets.
The valuations are based on reasonable and sustainable assumptions representing the best estimate of the
Executive Committee on the economic conditions that affect each subsidiary, the budgets and the latest forecasts
approved for those subsidiaries and their extrapolation to future periods. The assumptions made for these
valuations might vary with the change in economic conditions and in the market.
In 2025, there were no factors pointing to the deterioration of the value of those financial participations that could
lead to impairment charges in respect of goodwill.
Goodwill of Euro Bank, S.A. in the accounts of Bank Millennium, S.A. (Poland)
As a result of the purchase by Bank Millennium of 99.787% of shares of Euro Bank S.A. from SG Financial Services
Holdings, a 100% subsidiary of Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A., and the subsequent merger with the above-mentioned entity
in 2019, the difference in the fair value of the acquired assets and liabilities as at the acquisition date to the
purchase price was determined and, in accordance with the provisions of IFRS 3.32, was recognised as goodwill in
intangible assets (assigned to retail activities).
With respect to goodwill, an impairment test is performed at least once a year, regardless of any indication that
impairment may have occurred.
The input data for the goodwill test include the result on retail assets and liabilities allocated to Cash Generating
Units. To determine the amount of capital, an estimate of risk-weighted assets and a capital adequacy ratio that
meets regulatory minimums for the business were used. The test is performed by comparing the present value of
cash flows generated by the listed assets with the estimated amount of capital. Cash flow forecasts have been
prepared based on management's assumptions about all the conditions that will occur over the remaining useful
lives of the assets. They are consistent with the medium-term financial plan adopted by the Bank for 2026-2028
and the Bank's Strategy. Data for subsequent years after 2028 are the result of extrapolation of forecasts assuming
continued changes in the balance sheet and income statement and applying a residual value growth rate of 3%.
Cash flows were discounted using a cost of capital of approximately 12%, consisting of the market rate plus a risk
premium.
The test, executed as at the end of 2025, showed a surplus of the current value of cash flows over the net book
value of the cash-generating unit and therefore no impairment was found for this unit.
The changes occurred in Goodwill and intangible assets, during 2025, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
167,491
\u2014
\u2014
\u2014
1,969
169,460
Impairment
(122,254)
\u2014
\u2014
\u2014
(1,434)
(123,688)
45,237
\u2014
\u2014
\u2014
535
45,772
Intangible assets
Software
291,642
25,757
(13,669)
50,689
(4,443)
349,976
Software - in progress
71,726
72,395
(325)
(60,746)
271
83,321
Other intangible assets
49,797
181
(955)
10,043
652
59,718
413,165
98,333
(14,949)
(14)
(3,520)
493,015
Accumulated amortisation
Software
(149,965)
(43,019)
13,636
140
2,892
(176,316)
Other intangible assets
(32,467)
(7,529)
769
(140)
(421)
(39,788)
(182,432)
(50,548)
14,405
\u2014
2,471
(216,104)
230,733
47,785
(544)
(14)
(1,049)
276,911
275,970
47,785
(544)
(14)
(514)
322,683
The changes occurred in Goodwill and intangible assets, during 2024, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
165,043
\u2014
\u2014
\u2014
2,448
167,491
Impairment
(120,520)
\u2014
\u2014
\u2014
(1,734)
(122,254)
44,523
\u2014
\u2014
\u2014
714
45,237
Intangible assets
Software
243,546
23,969
(27,523)
47,725
3,925
291,642
Software - in progress
66,230
69,410
(218)
(64,566)
870
71,726
Other intangible assets
80,598
\u2014
(48,783)
16,928
1,054
49,797
390,374
93,379
(76,524)
87
5,849
413,165
Accumulated amortisation
Software
(138,508)
(35,632)
26,919
44
(2,788)
(149,965)
Other intangible assets
(73,284)
(7,043)
48,783
(44)
(879)
(32,467)
(211,792)
(42,675)
75,702
\u2014
(3,667)
(182,432)
178,582
50,704
(822)
87
2,182
230,733
223,105
50,704
(822)
87
2,896
275,970
", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-692": { "value": "
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
113,808
112,374
Euro Bank, S.A. (Poland)
45,497
44,924
Other
10,155
10,193
169,460
167,491
Impairment
Bank Millennium, S.A. (Poland)
(113,808)
(112,374)
Other
(9,880)
(9,880)
(123,688)
(122,254)
45,772
45,237
Intangible assets
Software
349,976
291,642
Software - in progress
83,321
71,726
Other intangible assets
59,718
49,797
493,015
413,165
Accumulated amortisation
Charge for the year (note 9)
(50,548)
(42,675)
Charge for the previous years
(165,556)
(139,757)
(216,104)
(182,432)
276,911
230,733
322,683
275,970
The changes occurred in Goodwill and intangible assets, during 2025, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
167,491
\u2014
\u2014
\u2014
1,969
169,460
Impairment
(122,254)
\u2014
\u2014
\u2014
(1,434)
(123,688)
45,237
\u2014
\u2014
\u2014
535
45,772
Intangible assets
Software
291,642
25,757
(13,669)
50,689
(4,443)
349,976
Software - in progress
71,726
72,395
(325)
(60,746)
271
83,321
Other intangible assets
49,797
181
(955)
10,043
652
59,718
413,165
98,333
(14,949)
(14)
(3,520)
493,015
Accumulated amortisation
Software
(149,965)
(43,019)
13,636
140
2,892
(176,316)
Other intangible assets
(32,467)
(7,529)
769
(140)
(421)
(39,788)
(182,432)
(50,548)
14,405
\u2014
2,471
(216,104)
230,733
47,785
(544)
(14)
(1,049)
276,911
275,970
47,785
(544)
(14)
(514)
322,683
The changes occurred in Goodwill and intangible assets, during 2024, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1 January
Acquisitions
/ Charge
Disposals
/ Write-off
Transfers
Exchange rate
differences
Balance as at
31 December
Goodwill - Differences arising
on consolidation
165,043
\u2014
\u2014
\u2014
2,448
167,491
Impairment
(120,520)
\u2014
\u2014
\u2014
(1,734)
(122,254)
44,523
\u2014
\u2014
\u2014
714
45,237
Intangible assets
Software
243,546
23,969
(27,523)
47,725
3,925
291,642
Software - in progress
66,230
69,410
(218)
(64,566)
870
71,726
Other intangible assets
80,598
\u2014
(48,783)
16,928
1,054
49,797
390,374
93,379
(76,524)
87
5,849
413,165
Accumulated amortisation
Software
(138,508)
(35,632)
26,919
44
(2,788)
(149,965)
Other intangible assets
(73,284)
(7,043)
48,783
(44)
(879)
(32,467)
(211,792)
(42,675)
75,702
\u2014
(3,667)
(182,432)
178,582
50,704
(822)
87
2,182
230,733
223,105
50,704
(822)
87
2,896
275,970
", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-694": { "value": "Income tax
Income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
704,514
\u2014
704,514
802,998
\u2014
802,998
Employee benefits
370,593
\u2014
370,593
539,415
\u2014
539,415
1,075,107
\u2014
1,075,107
1,342,413
\u2014
1,342,413
Deferred taxes depending
on the future profits
Impairment losses (b)
433,459
(3,723)
429,736
458,636
\u2014
458,636
Tax losses carried forward
239,713
\u2014
239,713
148,155
\u2014
148,155
Employee benefits
65,440
(65,400)
40
61,212
(36,601)
24,611
Financial assets at fair value through
other comprehensive income
185,006
(96,695)
88,311
348,396
(86,072)
262,324
Derivatives
\u2014
(2,703)
(2,703)
\u2014
(8,208)
(8,208)
Intangible assets
1,255
\u2014
1,255
1,012
\u2014
1,012
Other tangible assets
9,135
(2,511)
6,624
9,395
(3,065)
6,330
Others (c)
106,007
(205,544)
(99,537)
155,658
(144,908)
10,750
1,040,015
(376,576)
663,439
1,182,464
(278,854)
903,610
Total deferred taxes
2,115,122
(376,576)
1,738,546
2,524,877
(278,854)
2,246,023
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(370,752)
370,752
\u2014
(271,420)
271,420
\u2014
Net deferred taxes
1,744,370
(5,824)
1,738,546
2,253,457
(7,434)
2,246,023
Current taxes (d)
22,380
(86,354)
\u2014
21,159
(136,008)
\u2014
(a) Special Regime applicable to deferred tax assets.
(b) The amounts for 2025 and 2024 include deferred tax assets related with credit impairment losses not deducted for tax purposes of which credits
were written-off, according to the expectation that the use of such impairment will be deductible in the tax periods in which the legal conditions
required for their tax deductibility are met.
(c) Includes EUR 19,076,000 (31\u00a0December 2024 : EUR 61,929,000) relating to fair value adjustments of interests in real estate investment funds and
venture capital funds classified as equity instruments.
(d) The amounts of current taxes assets and liabilities refer exclusively to income taxes levied on the various BCP Group companies.
Special regime applicable to deferred tax assets
At the Extraordinary General Meeting of 15 October 2014 of Banco Comercial Portugu\u00eas, S.A. and the General
Meeting of 5 November 2014 of Banco ActivoBank, S.A., it was approved and resolved that these banks adhere to
the Special Regime approved by Law 61/2014, of 26 August, applicable to deferred tax assets that resulted from the
non-deduction of expenses and negative equity variations related to impairment losses on credits and post-
employment or long-term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods
beginning on or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last
tax period prior to that date and to part of expenses and negative equity variations associated with them.
Pursuant to Law 23/2016, of 19 August, this special regime is not applicable to expenses and negative equity
variations with impairment losses on credits and with post-employment or long-term employee benefits recorded
in the tax periods commencing on or after 1 January 2016, nor to deferred tax assets associated with them.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-
term employee benefits covered by it are deducted, under the terms and conditions set out in the Corporate
income tax Code and in relevant separate tax legislation, up to the limit of the taxable profit for the tax period
determined before these deductions. Expenses and negative equity variations not deducted due to this limit are
deducted in subsequent tax periods, with the same limit. In the BCP Group, deferred tax assets associated with
expenses and negative equity variations under these conditions amount to EUR 915,512,000 (31\u00a0December 2024:
EUR 1,152,769,000), of which EUR 697,542,000 relate to impairment losses on credits (31\u00a0December 2024: EUR
790,087,000) and EUR 217,970,000 relate to post-employment or long-term employee benefits (31\u00a0December 2024:
EUR 362,682,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorisation), deferred tax assets covered
by the Special Regime are converted into tax credits, in part or in full. In case of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period
and the total of equity, a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights of equivalent value attributable to the State are also constituted. These rights
that can be acquired by the shareholders upon payment to the State of the same value. Tax credits may be offset
against tax debts of the beneficiaries (or an entity based in Portugal within the same prudential consolidation
scope or included in the same group of entities for which are applied the Special Tax Regime for Groups of
Companies) or repaid by the State. Since neither Banco Comercial Portugu\u00eas nor Banco ActivoBank recorded net
losses in the years 2015 to 2025, there was no conversion of deferred taxes assets into tax credits, under the terms
provided for in the Special Regime.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by
Law 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law 98/2019, of 4 September,
establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after which the
Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these
rights are subject to a right of acquisition by the shareholders on the date of creation of the rights of the State,
exercisable in periods that will be established by the Board of Directors until 3 years after the confirmation date of
the conversion of the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing
entity shall deposit in favour of the State the amount of the price corresponding to all the rights issued, within 3
months beginning from the confirmation date of the conversion of the deferred tax asset into tax credit. Such
deposit shall be redeemed when and to the extent that the rights of the State are acquired by the shareholders or
exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the tax rates enacted or substantively enacted at the balance sheet date. The
deferred tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law,
current tax assets and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities
related to income taxes levied by the same tax authority over the same taxable entity.
Under Law 45-A/2024, of 31 December, which approved the State Budget for 2025, the standard IRC rate was
reduced from 21% to 20%.
The current tax rate for Banco Comercial Portugu\u00eas, S.A. is analysed as follows:
2025
2024
Income tax
20%
21%
Municipal surtax rate (on taxable net income)
1.5%
1.5%
State tax rate (on taxable net income)
More than 1,500,000 to 7,500,000
3%
3%
From more than 7,500,000 to 35,000,000
5%
5%
More than 35,000,000
9%
9%
Law No. 64/2025, of 7 November, was published, which changes the general IRC (Corporate Income Tax) to 19%,
18% and 17% for tax periods beginning in 2026, 2027 and in or after 2028, respectively.
Following these changes:
The deferred tax rate related to the Bank\u2019s tax losses as at 31 December 2025 is 17% (31\u00a0December 2024 : 20%).
The average deferred tax rate associated with temporary differences of Banco Comercial Portugu\u00eas, S.A. as at 31
December 2025 is 28% (31\u00a0December 2024: 30,3%).
The income tax rate in the other main countries where the Group operates is 19% in Poland and 32% in
Mozambique.
Starting in 2026, the income tax rate for banks in Poland will increase to 30%, decreasing to 26% in 2027 and to 23%
in 2028.
Following this change, the average rate of deferred taxes associated with temporary differences for Bank
Millennium, S.A. as at 31 December 2025, is 22.4% (31 December 2024: 19%).
The reporting period for tax losses carried forward in Poland and in Mozambique is 5 years.
Following the amendments provided for in Law 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses assessed in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses reduced from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law 27-A/2020, of 24 July.
Banco Comercial Portugu\u00eas, S.A. applies the Special Tax Regime for Groups of Companies (RETGS) since 2016 for
taxation purposes under corporate income tax (IRC), in which it\u2019s the dominant company.\u00a0The remaining
companies covered by the RETGS are Banco ActivoBank, S.A., Interfundos - Sociedade Gestora de Organismos de
Investimento Coletivo, S.A., BCP \u00c1frica, S.G.P.S. Lda., Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade Unipessoal
Lda., Millennium bcp Teleservi\u00e7os \u2013 Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico, S.A., and, from 2024, Imoserit, S.A.
Regarding the activity in Portugal, Law No. 98/2019, of 4 September, established the tax regime for credit
impairment losses and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
the approximation between the accounting and tax rules in what concerns the deductibility of credit impairment
losses. The rules in force until 2018 could continue to be applied until the end of the 2023 financial year, unless the
option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and impairment losses on debt instruments at amortised cost or at fair value
through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit, with
the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses relating
to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of the
Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still not
deducted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal No. 3/95, as amended before
its repeal by Notice of Banco de Portugal 5/2015 and, between other conditions, provided that they are not claims
covered by real estate rights.
The Group complies with the guidelines of IFRIC 23 - Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, with no material impact on its financial statements
resulting from its application.
Analysis of the recoverability of deferred tax assets
In accordance with the accounting policy 1 Y3 and with the requirements of IAS 12, the deferred tax assets were
recognised based on the Group's expectation of their recoverability. The recoverability of deferred taxes depends
on the implementation of the strategy of the Bank's Board of Directors, namely the generation of estimated
taxable income and its interpretation of tax legislation. Any changes in the assumptions used in estimating future
profits or tax legislation may have material impacts on deferred tax assets.
The assessment of the recoverability of deferred tax assets is based on the projected results for the period from
2026 to 2032, as longer forecast periods have higher underlying factors of uncertainty. The projected income
before taxes for the years 2026, 2027 and 2028 is consistent with the budget approved by the Bank's Board of
Directors in November 2025, which incorporates the priorities stemming from the 2025-2028 Strategic Plan. In the
earnings forecast for the years 2029, 2030, 2031 and 2032, a standard nominal growth rate of 2% was considered.
The forecasts consider the conclusion of the monetary policy easing cycle in the Eurozone, with the stabilisation of
interest rates and the development of the Bank\u2019s activity aligned with the commercial positioning and the targets
enshrined in the 2025-2028 Strategic Plan approved by the governing bodies, highlighting:
- after reflecting the impacts of the normalisation of interest rates, net interest income benefits from the recovery
of volumes in customer lending, especially to companies, with a focus on priority segments associated with
customer knowledge and relationship, and continued growth of the deposit base, focusing on customer
engagement and transactionality;
- increase in commission income based on an efficient and judicious management of commissions and price lists;
- stabilisation of cost of risk at levels in line with the Group's current activity, given the lower impact from the
historical portfolios of NPEs, foreclosed assets and FRE (Corporate Restructuring Funds), after the reduction of
these exposures achieved over the last years;
- strengthening of the capabilities required for the implementation of the initiatives foreseen in the 2025-2028
Strategic Plan, while preserving high levels of efficiency based on continued cost discipline and increased use of
technology.
To estimate taxable net income for the periods of 2026 to 2032, the following main assumptions were considered:
- The rules of the new tax regime of credit impairment were applied. In the application of these rules, the following
assumptions were considered, in general terms:
a) the impairment losses for credit risk related to exposures analysed on an individual or collective basis,
recognised in accordance with the applicable accounting and regulatory standards, were considered deductible
for tax purposes;
b) impairment reversals created up to 31 December 2021 not accepted for tax purposes were estimated based on
the most recent Non-Performing Assets Reduction Plan (2025-2027), and also on the basis of the average
percentage of reversal observed in the last years from 2016 to 2025;
c) the referred average percentages were calculated separately, depending on whether or not there was a
mortgage guarantee, the eligibility for purposes of the special regime applicable to deferred tax assets and
according to the customers\u2019 classification as Non-Performing Exposures (NPE).
- The increase in provisions for guarantees was considered, as fully, as deductible for tax purposes, under the terms
of the current rules. Reversals of provisions taxed until 31 December 2021 are being estimated based on the
percentage of impairment replacement taxed for the years 2022 to 2025.
- The deductions related to impairment of financial assets were projected based on the destination (sale or
settlement) and the estimated date of the respective operations;
- Impairment reversals of non-financial assets not accepted for tax purposes were projected considering the
expected periods of disinvestment in certain real estate assets. For the remaining assets without a forecasted
term for disinvestment, the reversals were estimated based on the average percentage of reversal observed in the
years from 2016 to 2025. Non-deductible expenses related to the reinforcement of impairment of non-financial
assets were estimated on the based on the average percentage of amounts not deducted for tax purposes in the
years from 2016 to 2025, compared to the amounts of reinforcements net of impairment recorded in those years;\u00a0
- The deductions related to employee benefits were projected based on their estimated payments or deduction
plans, in accordance with information provided by the pension fund actuary;\u00a0
- The realisation of changes in the fair value of real estate investment funds and venture capital funds classified as
equity instruments, was projected based on the information available in the regulations of the funds in question in
relation to the period foreseen for the respective liquidation.
According to the estimate of future taxable income, the deferred taxes assets recorded as at 31 December 2025 are
adequate under the IAS 12 requirements.
In accordance with these assessments, the amount of unrecognised deferred tax related to temporary differences
and to tax losses is as follows:
(Thousands of euros)
2025
2024
Temporary differences
990
1,072
Tax losses carried forward
2014
131,067
154,196
2015
2
2
2016
102,610
265,652
2017
2,245
2,347
2018
78,534
92,394
2019
21,675
25,500
2020
4,009
19,481
2021
146,886
172,782
2022
14,482
18,569
2023
2,547
3,851
2024
22,595
17,661
2025
40,432
\u2014
Total
567,084
772,435
The amount of unrecognised deferred taxes relating to tax losses per expiry year is analysed as follows:
(Thousands of euros)
2025
2024
2025
\u2014
14,558
2026
132
131
2027
11,247
11,565
2028
885
1,008
2029
18,886
21,503
2030
40,237
\u2014
No expiry date
495,697
723,670
Total
567,084
772,435
In addition to the above amounts, the Bank is contesting corrections to tax losses for 2014, 2016, 2021 and 2022,
which, if granted, will increase the value of unrecognised deferred taxes assets by EUR 81,613,000.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2025, is
analysed as follows:
(Thousands of euros)
2025
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(98,484)
\u2014
\u2014
Employee benefits
(145,914)
(22,908)
\u2014
(244,398)
(22,908)
\u2014
Deferred taxes depending on the future profits
Impairment losses
(36,038)
(1,311)
8,449
Tax losses carried forward (a)
83,636
7,885
37
Employee benefits
11,253
(37,172)
1,348
Financial assets at fair value through other comprehensive income
\u2014
(155,291)
(18,722)
Derivatives
5,592
\u2014
(87)
Intangible assets
229
\u2014
14
Other tangible assets
299
\u2014
(5)
Other
(126,418)
(303)
16,434
(61,447)
(186,192)
7,468
(305,845)
(209,100)
7,468
Current taxes
Current year
(124,772)
(1)
\u2014
Correction of previous years (b)
21,937
\u2014
\u2014
(102,835)
(1)
\u2014
(408,680)
(209,101)
7,468
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
(b) In 2025, this mainly relates to the tax credit that Bank Millennium benefited from credit write-off agreements with customers who had mortgage
credit agreements in Swiss francs and which,\u00a0 in turn, led to the reduction in deferred tax assets previously recorded in relation to provisions set up for
these contingencies.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2024, is
analysed as follows:
(Thousands of euros)
2024
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(59,263)
\u2014
\u2014
Employee benefits
(180,816)
(12,042)
\u2014
(240,079)
(12,042)
\u2014
Deferred taxes depending on the future profits
Impairment losses
36,584
(656)
3,164
Tax losses carried forward (a)
(26,850)
6,890
120
Employee benefits
(1,100)
63,273
6
Financial assets at fair value through other comprehensive income
\u2014
(151,348)
(3,651)
Derivatives
(334)
\u2014
(124)
Intangible assets
29
\u2014
15
Other tangible assets
202
\u2014
(5)
Other
29,065
(5,215)
2,543
37,596
(87,056)
2,068
(202,483)
(99,098)
2,068
Current taxes
Current year
(148,600)
\u2014
\u2014
Correction of previous years
9,832
\u2014
\u2014
(138,768)
\u2014
\u2014
(341,251)
(99,098)
2,068
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
The impact of income taxes in Net income and in other balances of Group's equity, by geographies where the
Group operates, with reference to 31 December 2025 and 2024, is analysed as follows:
(Thousands of euros)
2025
2024
Portugal
Poland
Mozambique
Portugal
Poland
Mozambique
Current year
Deferred taxes
(279,519)
(26,326)
\u2014
(262,073)
61,007
(1,417)
Current taxes
(5,149)
(72,345)
(25,341)
(11,524)
(97,203)
(30,041)
(284,668)
(98,671)
(25,341)
(273,597)
(36,196)
(31,458)
Reserves and Exchange differences
Deferred taxes
(191,743)
(9,890)
\u2014
(90,312)
6,514
(204)
Current taxes
(1)
\u2014
\u2014
\u2014
\u2014
\u2014
(191,744)
(9,890)
\u2014
(90,312)
6,514
(204)
(476,412)
(108,561)
(25,341)
(363,909)
(29,682)
(31,662)
The reconciliation between the nominal tax rate and the effective tax rate is analysed as follows:
(Thousands of euros)
2025
2024
Income before taxes
1,569,408
1,341,412
Current tax rate (%)
30.5%
31.5%
Tax at the applicable tax rate
(478,669)
(422,545)
Non-deductible impairment and provisions (a)
(17,625)
(22,542)
Mandatory contributions on the banking sector (b)
(24,333)
(23,297)
Results of companies accounted by the equity method
18,989
17,959
Interests on other equity instruments (c)
9,913
10,592
Effect of the tax rate difference (d)
66,447
42,879
Effect of rate change (e)
(78,065)
(49,792)
Effect of recognition/derecognition net of deferred taxes (f)
57,770
105,087
Non-deductible costs and other corrections
16,773
(14,031)
Correction of previous years
11,216
6,426
Impact of the special regime for the taxation of groups of companies
9,395
8,660
Autonomous taxation
(491)
(647)
Total
(408,680)
(341,251)
Effective rate (%)
26.0%
25.4%
(a) In 2025, it includes the negative amount of EUR 12,463,000 (2024: negative EUR 47,930,000) related to the net impact of the non-deductibility for
tax purposes of the provisions related to legal risks associated with the portfolio of mortgages granted in foreign currency by Bank Millennium.
(b) This relates to taxes on the banking sector in Poland in the negative amount of EUR 24,905,000 (31 December 2024: negative EUR 12,944,000) and
in Portugal in the amount of EUR 572,000 (31 December 2024: negative EUR 10,353,129), which includes the negative amount of EUR 8,711,000 (31
December 2024: negative EUR 8,795,000) relating to the contribution on the banking sector and the amount of EUR 9,282,000 (31 December 2024:
negative EUR 1,558,000) relating to the Additional Solidarity on the Banking Sector, resulting from favourable court decisions issued in the legal
proceedings contesting the amount paid by BCP and Banco ActivoBank in 2020, 2021 and 2022 and the respective final judgment, as well as the
return of the amounts paid in the fiscal years 2023 and 2024.
(c) Relates to the impact of the deduction for taxable income purposes of interest paid in respect of perpetual bonds representing subordinated debt
issued on 31 January 2019 and 18 January 2024.
(d) In 2025, it includes the amount of EUR 17,018,000 (2024: EUR 18,024,000) related to the effect of taxation at a rate of 20% on interests from
Mozambique's public debt securities and the amount of EUR 43,973,000 (2024: EUR 25,408,000) related to the effect of the difference in the income
tax rate in Poland, which is 19%, on a income before taxes.
(e) It relates to the impact of the reduction of the rate of corporate income tax in Portugal, negative amount of EUR 103,641,000 (2024: negative EUR
49,792,000), net of the impact of the increase in the tax rate in Poland of EUR 25,631,000 (2024: EUR 0).
(f) In 2025, it includes the amount of EUR 103,666,000 of deferred taxes assets recognised by BCP relating to tax losses and the negative amount of
EUR 32,906,000 relating to the non-recognition of deferred tax assets on tax loss of Banco Internacional de Mo\u00e7ambique.
In 2024, it includes the additional recognition of deferred tax assets by Banco Comercial Portugu\u00eas relating to credit impairment (EUR 21,504,000)
and fair value losses on venture capital funds classified as equity instruments (EUR 44,583,000), not deducted for tax purposes in previous years, and
by Bank Millennium relating to future adjustments of income (interest, commissions and exchange gains) obtained on foreign currency-indexed
mortgages and mortgage contracts granted in foreign currency (in particular in Swiss francs) subject to legal disputes for their cancellation (EUR
43,408,000), and the negative amount of EUR 21,860,000 relating to the non-recognition of deferred tax assets on the tax loss of Banco Internacional
de Mo\u00e7ambique.
Directive (EU) 2022/2523 of the Council, of 15 December 2022 \u2013 Minimum level of
taxation of 15% per jurisdiction
Under Pillar 2 of the Base Erosion and Profit Shifting 2.0 (\"BEPS 2.0\") project of the Organisation for Economic Co-
operation and Development (\"OECD\"), enshrined in Council Directive (EU) 2022/2523 of 15 December 2022,
multinationals enterprises and large national groups with consolidated annual revenues of more than EUR 750
million in at least two of the last four financial years, will become subject, as of the 2024 financial year, to a
minimum level of taxation of 15% in each of the jurisdiction they operate.
Directive (EU) 2022/2523, on ensuring a worldwide minimum level of taxation for multinational companies groups
and large national groups within the Union, was transposed into domestic legislation in Portugal, through Law
41/2024, of 8 November. In Poland, the transposition of this Directive took place on 15 November 2024.
The regime in question may determine the payment of a top-up tax when a minimum level of taxation of 15% is
not observed, on a jurisdictional basis.
According to the analysis carried out on the potential future impacts of this regime, the Group estimates that it
will meet, in the jurisdictions in which it operates, namely in Portugal, Poland and Mozambique, the necessary
requirements for the application of \"transitional safe harbours\", thus being excluded, between 2024-2026, from the
obligation to calculate any top-up tax.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTaxReceivablesAndPayablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-693": { "value": "Income tax
Income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
704,514
\u2014
704,514
802,998
\u2014
802,998
Employee benefits
370,593
\u2014
370,593
539,415
\u2014
539,415
1,075,107
\u2014
1,075,107
1,342,413
\u2014
1,342,413
Deferred taxes depending
on the future profits
Impairment losses (b)
433,459
(3,723)
429,736
458,636
\u2014
458,636
Tax losses carried forward
239,713
\u2014
239,713
148,155
\u2014
148,155
Employee benefits
65,440
(65,400)
40
61,212
(36,601)
24,611
Financial assets at fair value through
other comprehensive income
185,006
(96,695)
88,311
348,396
(86,072)
262,324
Derivatives
\u2014
(2,703)
(2,703)
\u2014
(8,208)
(8,208)
Intangible assets
1,255
\u2014
1,255
1,012
\u2014
1,012
Other tangible assets
9,135
(2,511)
6,624
9,395
(3,065)
6,330
Others (c)
106,007
(205,544)
(99,537)
155,658
(144,908)
10,750
1,040,015
(376,576)
663,439
1,182,464
(278,854)
903,610
Total deferred taxes
2,115,122
(376,576)
1,738,546
2,524,877
(278,854)
2,246,023
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(370,752)
370,752
\u2014
(271,420)
271,420
\u2014
Net deferred taxes
1,744,370
(5,824)
1,738,546
2,253,457
(7,434)
2,246,023
Current taxes (d)
22,380
(86,354)
\u2014
21,159
(136,008)
\u2014
(a) Special Regime applicable to deferred tax assets.
(b) The amounts for 2025 and 2024 include deferred tax assets related with credit impairment losses not deducted for tax purposes of which credits
were written-off, according to the expectation that the use of such impairment will be deductible in the tax periods in which the legal conditions
required for their tax deductibility are met.
(c) Includes EUR 19,076,000 (31\u00a0December 2024 : EUR 61,929,000) relating to fair value adjustments of interests in real estate investment funds and
venture capital funds classified as equity instruments.
(d) The amounts of current taxes assets and liabilities refer exclusively to income taxes levied on the various BCP Group companies.
Special regime applicable to deferred tax assets
At the Extraordinary General Meeting of 15 October 2014 of Banco Comercial Portugu\u00eas, S.A. and the General
Meeting of 5 November 2014 of Banco ActivoBank, S.A., it was approved and resolved that these banks adhere to
the Special Regime approved by Law 61/2014, of 26 August, applicable to deferred tax assets that resulted from the
non-deduction of expenses and negative equity variations related to impairment losses on credits and post-
employment or long-term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods
beginning on or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last
tax period prior to that date and to part of expenses and negative equity variations associated with them.
Pursuant to Law 23/2016, of 19 August, this special regime is not applicable to expenses and negative equity
variations with impairment losses on credits and with post-employment or long-term employee benefits recorded
in the tax periods commencing on or after 1 January 2016, nor to deferred tax assets associated with them.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-
term employee benefits covered by it are deducted, under the terms and conditions set out in the Corporate
income tax Code and in relevant separate tax legislation, up to the limit of the taxable profit for the tax period
determined before these deductions. Expenses and negative equity variations not deducted due to this limit are
deducted in subsequent tax periods, with the same limit. In the BCP Group, deferred tax assets associated with
expenses and negative equity variations under these conditions amount to EUR 915,512,000 (31\u00a0December 2024:
EUR 1,152,769,000), of which EUR 697,542,000 relate to impairment losses on credits (31\u00a0December 2024: EUR
790,087,000) and EUR 217,970,000 relate to post-employment or long-term employee benefits (31\u00a0December 2024:
EUR 362,682,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorisation), deferred tax assets covered
by the Special Regime are converted into tax credits, in part or in full. In case of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period
and the total of equity, a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights of equivalent value attributable to the State are also constituted. These rights
that can be acquired by the shareholders upon payment to the State of the same value. Tax credits may be offset
against tax debts of the beneficiaries (or an entity based in Portugal within the same prudential consolidation
scope or included in the same group of entities for which are applied the Special Tax Regime for Groups of
Companies) or repaid by the State. Since neither Banco Comercial Portugu\u00eas nor Banco ActivoBank recorded net
losses in the years 2015 to 2025, there was no conversion of deferred taxes assets into tax credits, under the terms
provided for in the Special Regime.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by
Law 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law 98/2019, of 4 September,
establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after which the
Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these
rights are subject to a right of acquisition by the shareholders on the date of creation of the rights of the State,
exercisable in periods that will be established by the Board of Directors until 3 years after the confirmation date of
the conversion of the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing
entity shall deposit in favour of the State the amount of the price corresponding to all the rights issued, within 3
months beginning from the confirmation date of the conversion of the deferred tax asset into tax credit. Such
deposit shall be redeemed when and to the extent that the rights of the State are acquired by the shareholders or
exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the tax rates enacted or substantively enacted at the balance sheet date. The
deferred tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law,
current tax assets and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities
related to income taxes levied by the same tax authority over the same taxable entity.
Under Law 45-A/2024, of 31 December, which approved the State Budget for 2025, the standard IRC rate was
reduced from 21% to 20%.
The current tax rate for Banco Comercial Portugu\u00eas, S.A. is analysed as follows:
2025
2024
Income tax
20%
21%
Municipal surtax rate (on taxable net income)
1.5%
1.5%
State tax rate (on taxable net income)
More than 1,500,000 to 7,500,000
3%
3%
From more than 7,500,000 to 35,000,000
5%
5%
More than 35,000,000
9%
9%
Law No. 64/2025, of 7 November, was published, which changes the general IRC (Corporate Income Tax) to 19%,
18% and 17% for tax periods beginning in 2026, 2027 and in or after 2028, respectively.
Following these changes:
The deferred tax rate related to the Bank\u2019s tax losses as at 31 December 2025 is 17% (31\u00a0December 2024 : 20%).
The average deferred tax rate associated with temporary differences of Banco Comercial Portugu\u00eas, S.A. as at 31
December 2025 is 28% (31\u00a0December 2024: 30,3%).
The income tax rate in the other main countries where the Group operates is 19% in Poland and 32% in
Mozambique.
Starting in 2026, the income tax rate for banks in Poland will increase to 30%, decreasing to 26% in 2027 and to 23%
in 2028.
Following this change, the average rate of deferred taxes associated with temporary differences for Bank
Millennium, S.A. as at 31 December 2025, is 22.4% (31 December 2024: 19%).
The reporting period for tax losses carried forward in Poland and in Mozambique is 5 years.
Following the amendments provided for in Law 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses assessed in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses reduced from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law 27-A/2020, of 24 July.
Banco Comercial Portugu\u00eas, S.A. applies the Special Tax Regime for Groups of Companies (RETGS) since 2016 for
taxation purposes under corporate income tax (IRC), in which it\u2019s the dominant company.\u00a0The remaining
companies covered by the RETGS are Banco ActivoBank, S.A., Interfundos - Sociedade Gestora de Organismos de
Investimento Coletivo, S.A., BCP \u00c1frica, S.G.P.S. Lda., Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade Unipessoal
Lda., Millennium bcp Teleservi\u00e7os \u2013 Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico, S.A., and, from 2024, Imoserit, S.A.
Regarding the activity in Portugal, Law No. 98/2019, of 4 September, established the tax regime for credit
impairment losses and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
the approximation between the accounting and tax rules in what concerns the deductibility of credit impairment
losses. The rules in force until 2018 could continue to be applied until the end of the 2023 financial year, unless the
option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and impairment losses on debt instruments at amortised cost or at fair value
through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit, with
the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses relating
to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of the
Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still not
deducted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal No. 3/95, as amended before
its repeal by Notice of Banco de Portugal 5/2015 and, between other conditions, provided that they are not claims
covered by real estate rights.
The Group complies with the guidelines of IFRIC 23 - Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, with no material impact on its financial statements
resulting from its application.
Analysis of the recoverability of deferred tax assets
In accordance with the accounting policy 1 Y3 and with the requirements of IAS 12, the deferred tax assets were
recognised based on the Group's expectation of their recoverability. The recoverability of deferred taxes depends
on the implementation of the strategy of the Bank's Board of Directors, namely the generation of estimated
taxable income and its interpretation of tax legislation. Any changes in the assumptions used in estimating future
profits or tax legislation may have material impacts on deferred tax assets.
The assessment of the recoverability of deferred tax assets is based on the projected results for the period from
2026 to 2032, as longer forecast periods have higher underlying factors of uncertainty. The projected income
before taxes for the years 2026, 2027 and 2028 is consistent with the budget approved by the Bank's Board of
Directors in November 2025, which incorporates the priorities stemming from the 2025-2028 Strategic Plan. In the
earnings forecast for the years 2029, 2030, 2031 and 2032, a standard nominal growth rate of 2% was considered.
The forecasts consider the conclusion of the monetary policy easing cycle in the Eurozone, with the stabilisation of
interest rates and the development of the Bank\u2019s activity aligned with the commercial positioning and the targets
enshrined in the 2025-2028 Strategic Plan approved by the governing bodies, highlighting:
- after reflecting the impacts of the normalisation of interest rates, net interest income benefits from the recovery
of volumes in customer lending, especially to companies, with a focus on priority segments associated with
customer knowledge and relationship, and continued growth of the deposit base, focusing on customer
engagement and transactionality;
- increase in commission income based on an efficient and judicious management of commissions and price lists;
- stabilisation of cost of risk at levels in line with the Group's current activity, given the lower impact from the
historical portfolios of NPEs, foreclosed assets and FRE (Corporate Restructuring Funds), after the reduction of
these exposures achieved over the last years;
- strengthening of the capabilities required for the implementation of the initiatives foreseen in the 2025-2028
Strategic Plan, while preserving high levels of efficiency based on continued cost discipline and increased use of
technology.
To estimate taxable net income for the periods of 2026 to 2032, the following main assumptions were considered:
- The rules of the new tax regime of credit impairment were applied. In the application of these rules, the following
assumptions were considered, in general terms:
a) the impairment losses for credit risk related to exposures analysed on an individual or collective basis,
recognised in accordance with the applicable accounting and regulatory standards, were considered deductible
for tax purposes;
b) impairment reversals created up to 31 December 2021 not accepted for tax purposes were estimated based on
the most recent Non-Performing Assets Reduction Plan (2025-2027), and also on the basis of the average
percentage of reversal observed in the last years from 2016 to 2025;
c) the referred average percentages were calculated separately, depending on whether or not there was a
mortgage guarantee, the eligibility for purposes of the special regime applicable to deferred tax assets and
according to the customers\u2019 classification as Non-Performing Exposures (NPE).
- The increase in provisions for guarantees was considered, as fully, as deductible for tax purposes, under the terms
of the current rules. Reversals of provisions taxed until 31 December 2021 are being estimated based on the
percentage of impairment replacement taxed for the years 2022 to 2025.
- The deductions related to impairment of financial assets were projected based on the destination (sale or
settlement) and the estimated date of the respective operations;
- Impairment reversals of non-financial assets not accepted for tax purposes were projected considering the
expected periods of disinvestment in certain real estate assets. For the remaining assets without a forecasted
term for disinvestment, the reversals were estimated based on the average percentage of reversal observed in the
years from 2016 to 2025. Non-deductible expenses related to the reinforcement of impairment of non-financial
assets were estimated on the based on the average percentage of amounts not deducted for tax purposes in the
years from 2016 to 2025, compared to the amounts of reinforcements net of impairment recorded in those years;\u00a0
- The deductions related to employee benefits were projected based on their estimated payments or deduction
plans, in accordance with information provided by the pension fund actuary;\u00a0
- The realisation of changes in the fair value of real estate investment funds and venture capital funds classified as
equity instruments, was projected based on the information available in the regulations of the funds in question in
relation to the period foreseen for the respective liquidation.
According to the estimate of future taxable income, the deferred taxes assets recorded as at 31 December 2025 are
adequate under the IAS 12 requirements.
In accordance with these assessments, the amount of unrecognised deferred tax related to temporary differences
and to tax losses is as follows:
(Thousands of euros)
2025
2024
Temporary differences
990
1,072
Tax losses carried forward
2014
131,067
154,196
2015
2
2
2016
102,610
265,652
2017
2,245
2,347
2018
78,534
92,394
2019
21,675
25,500
2020
4,009
19,481
2021
146,886
172,782
2022
14,482
18,569
2023
2,547
3,851
2024
22,595
17,661
2025
40,432
\u2014
Total
567,084
772,435
The amount of unrecognised deferred taxes relating to tax losses per expiry year is analysed as follows:
(Thousands of euros)
2025
2024
2025
\u2014
14,558
2026
132
131
2027
11,247
11,565
2028
885
1,008
2029
18,886
21,503
2030
40,237
\u2014
No expiry date
495,697
723,670
Total
567,084
772,435
In addition to the above amounts, the Bank is contesting corrections to tax losses for 2014, 2016, 2021 and 2022,
which, if granted, will increase the value of unrecognised deferred taxes assets by EUR 81,613,000.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2025, is
analysed as follows:
(Thousands of euros)
2025
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(98,484)
\u2014
\u2014
Employee benefits
(145,914)
(22,908)
\u2014
(244,398)
(22,908)
\u2014
Deferred taxes depending on the future profits
Impairment losses
(36,038)
(1,311)
8,449
Tax losses carried forward (a)
83,636
7,885
37
Employee benefits
11,253
(37,172)
1,348
Financial assets at fair value through other comprehensive income
\u2014
(155,291)
(18,722)
Derivatives
5,592
\u2014
(87)
Intangible assets
229
\u2014
14
Other tangible assets
299
\u2014
(5)
Other
(126,418)
(303)
16,434
(61,447)
(186,192)
7,468
(305,845)
(209,100)
7,468
Current taxes
Current year
(124,772)
(1)
\u2014
Correction of previous years (b)
21,937
\u2014
\u2014
(102,835)
(1)
\u2014
(408,680)
(209,101)
7,468
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
(b) In 2025, this mainly relates to the tax credit that Bank Millennium benefited from credit write-off agreements with customers who had mortgage
credit agreements in Swiss francs and which,\u00a0 in turn, led to the reduction in deferred tax assets previously recorded in relation to provisions set up for
these contingencies.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2024, is
analysed as follows:
(Thousands of euros)
2024
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(59,263)
\u2014
\u2014
Employee benefits
(180,816)
(12,042)
\u2014
(240,079)
(12,042)
\u2014
Deferred taxes depending on the future profits
Impairment losses
36,584
(656)
3,164
Tax losses carried forward (a)
(26,850)
6,890
120
Employee benefits
(1,100)
63,273
6
Financial assets at fair value through other comprehensive income
\u2014
(151,348)
(3,651)
Derivatives
(334)
\u2014
(124)
Intangible assets
29
\u2014
15
Other tangible assets
202
\u2014
(5)
Other
29,065
(5,215)
2,543
37,596
(87,056)
2,068
(202,483)
(99,098)
2,068
Current taxes
Current year
(148,600)
\u2014
\u2014
Correction of previous years
9,832
\u2014
\u2014
(138,768)
\u2014
\u2014
(341,251)
(99,098)
2,068
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
The impact of income taxes in Net income and in other balances of Group's equity, by geographies where the
Group operates, with reference to 31 December 2025 and 2024, is analysed as follows:
(Thousands of euros)
2025
2024
Portugal
Poland
Mozambique
Portugal
Poland
Mozambique
Current year
Deferred taxes
(279,519)
(26,326)
\u2014
(262,073)
61,007
(1,417)
Current taxes
(5,149)
(72,345)
(25,341)
(11,524)
(97,203)
(30,041)
(284,668)
(98,671)
(25,341)
(273,597)
(36,196)
(31,458)
Reserves and Exchange differences
Deferred taxes
(191,743)
(9,890)
\u2014
(90,312)
6,514
(204)
Current taxes
(1)
\u2014
\u2014
\u2014
\u2014
\u2014
(191,744)
(9,890)
\u2014
(90,312)
6,514
(204)
(476,412)
(108,561)
(25,341)
(363,909)
(29,682)
(31,662)
The reconciliation between the nominal tax rate and the effective tax rate is analysed as follows:
(Thousands of euros)
2025
2024
Income before taxes
1,569,408
1,341,412
Current tax rate (%)
30.5%
31.5%
Tax at the applicable tax rate
(478,669)
(422,545)
Non-deductible impairment and provisions (a)
(17,625)
(22,542)
Mandatory contributions on the banking sector (b)
(24,333)
(23,297)
Results of companies accounted by the equity method
18,989
17,959
Interests on other equity instruments (c)
9,913
10,592
Effect of the tax rate difference (d)
66,447
42,879
Effect of rate change (e)
(78,065)
(49,792)
Effect of recognition/derecognition net of deferred taxes (f)
57,770
105,087
Non-deductible costs and other corrections
16,773
(14,031)
Correction of previous years
11,216
6,426
Impact of the special regime for the taxation of groups of companies
9,395
8,660
Autonomous taxation
(491)
(647)
Total
(408,680)
(341,251)
Effective rate (%)
26.0%
25.4%
(a) In 2025, it includes the negative amount of EUR 12,463,000 (2024: negative EUR 47,930,000) related to the net impact of the non-deductibility for
tax purposes of the provisions related to legal risks associated with the portfolio of mortgages granted in foreign currency by Bank Millennium.
(b) This relates to taxes on the banking sector in Poland in the negative amount of EUR 24,905,000 (31 December 2024: negative EUR 12,944,000) and
in Portugal in the amount of EUR 572,000 (31 December 2024: negative EUR 10,353,129), which includes the negative amount of EUR 8,711,000 (31
December 2024: negative EUR 8,795,000) relating to the contribution on the banking sector and the amount of EUR 9,282,000 (31 December 2024:
negative EUR 1,558,000) relating to the Additional Solidarity on the Banking Sector, resulting from favourable court decisions issued in the legal
proceedings contesting the amount paid by BCP and Banco ActivoBank in 2020, 2021 and 2022 and the respective final judgment, as well as the
return of the amounts paid in the fiscal years 2023 and 2024.
(c) Relates to the impact of the deduction for taxable income purposes of interest paid in respect of perpetual bonds representing subordinated debt
issued on 31 January 2019 and 18 January 2024.
(d) In 2025, it includes the amount of EUR 17,018,000 (2024: EUR 18,024,000) related to the effect of taxation at a rate of 20% on interests from
Mozambique's public debt securities and the amount of EUR 43,973,000 (2024: EUR 25,408,000) related to the effect of the difference in the income
tax rate in Poland, which is 19%, on a income before taxes.
(e) It relates to the impact of the reduction of the rate of corporate income tax in Portugal, negative amount of EUR 103,641,000 (2024: negative EUR
49,792,000), net of the impact of the increase in the tax rate in Poland of EUR 25,631,000 (2024: EUR 0).
(f) In 2025, it includes the amount of EUR 103,666,000 of deferred taxes assets recognised by BCP relating to tax losses and the negative amount of
EUR 32,906,000 relating to the non-recognition of deferred tax assets on tax loss of Banco Internacional de Mo\u00e7ambique.
In 2024, it includes the additional recognition of deferred tax assets by Banco Comercial Portugu\u00eas relating to credit impairment (EUR 21,504,000)
and fair value losses on venture capital funds classified as equity instruments (EUR 44,583,000), not deducted for tax purposes in previous years, and
by Bank Millennium relating to future adjustments of income (interest, commissions and exchange gains) obtained on foreign currency-indexed
mortgages and mortgage contracts granted in foreign currency (in particular in Swiss francs) subject to legal disputes for their cancellation (EUR
43,408,000), and the negative amount of EUR 21,860,000 relating to the non-recognition of deferred tax assets on the tax loss of Banco Internacional
de Mo\u00e7ambique.
Directive (EU) 2022/2523 of the Council, of 15 December 2022 \u2013 Minimum level of
taxation of 15% per jurisdiction
Under Pillar 2 of the Base Erosion and Profit Shifting 2.0 (\"BEPS 2.0\") project of the Organisation for Economic Co-
operation and Development (\"OECD\"), enshrined in Council Directive (EU) 2022/2523 of 15 December 2022,
multinationals enterprises and large national groups with consolidated annual revenues of more than EUR 750
million in at least two of the last four financial years, will become subject, as of the 2024 financial year, to a
minimum level of taxation of 15% in each of the jurisdiction they operate.
Directive (EU) 2022/2523, on ensuring a worldwide minimum level of taxation for multinational companies groups
and large national groups within the Union, was transposed into domestic legislation in Portugal, through Law
41/2024, of 8 November. In Poland, the transposition of this Directive took place on 15 November 2024.
The regime in question may determine the payment of a top-up tax when a minimum level of taxation of 15% is
not observed, on a jurisdictional basis.
According to the analysis carried out on the potential future impacts of this regime, the Group estimates that it
will meet, in the jurisdictions in which it operates, namely in Portugal, Poland and Mozambique, the necessary
requirements for the application of \"transitional safe harbours\", thus being excluded, between 2024-2026, from the
obligation to calculate any top-up tax.
", "dimensions": { "concept": "ifrs-full:DisclosureOfIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-695": { "value": "
Income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2025
2024
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
704,514
\u2014
704,514
802,998
\u2014
802,998
Employee benefits
370,593
\u2014
370,593
539,415
\u2014
539,415
1,075,107
\u2014
1,075,107
1,342,413
\u2014
1,342,413
Deferred taxes depending
on the future profits
Impairment losses (b)
433,459
(3,723)
429,736
458,636
\u2014
458,636
Tax losses carried forward
239,713
\u2014
239,713
148,155
\u2014
148,155
Employee benefits
65,440
(65,400)
40
61,212
(36,601)
24,611
Financial assets at fair value through
other comprehensive income
185,006
(96,695)
88,311
348,396
(86,072)
262,324
Derivatives
\u2014
(2,703)
(2,703)
\u2014
(8,208)
(8,208)
Intangible assets
1,255
\u2014
1,255
1,012
\u2014
1,012
Other tangible assets
9,135
(2,511)
6,624
9,395
(3,065)
6,330
Others (c)
106,007
(205,544)
(99,537)
155,658
(144,908)
10,750
1,040,015
(376,576)
663,439
1,182,464
(278,854)
903,610
Total deferred taxes
2,115,122
(376,576)
1,738,546
2,524,877
(278,854)
2,246,023
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(370,752)
370,752
\u2014
(271,420)
271,420
\u2014
Net deferred taxes
1,744,370
(5,824)
1,738,546
2,253,457
(7,434)
2,246,023
Current taxes (d)
22,380
(86,354)
\u2014
21,159
(136,008)
\u2014
(a) Special Regime applicable to deferred tax assets.
(b) The amounts for 2025 and 2024 include deferred tax assets related with credit impairment losses not deducted for tax purposes of which credits
were written-off, according to the expectation that the use of such impairment will be deductible in the tax periods in which the legal conditions
required for their tax deductibility are met.
(c) Includes EUR 19,076,000 (31\u00a0December 2024 : EUR 61,929,000) relating to fair value adjustments of interests in real estate investment funds and
venture capital funds classified as equity instruments.
(d) The amounts of current taxes assets and liabilities refer exclusively to income taxes levied on the various BCP Group companies.
Special regime applicable to deferred tax assets
At the Extraordinary General Meeting of 15 October 2014 of Banco Comercial Portugu\u00eas, S.A. and the General
Meeting of 5 November 2014 of Banco ActivoBank, S.A., it was approved and resolved that these banks adhere to
the Special Regime approved by Law 61/2014, of 26 August, applicable to deferred tax assets that resulted from the
non-deduction of expenses and negative equity variations related to impairment losses on credits and post-
employment or long-term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods
beginning on or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last
tax period prior to that date and to part of expenses and negative equity variations associated with them.
Pursuant to Law 23/2016, of 19 August, this special regime is not applicable to expenses and negative equity
variations with impairment losses on credits and with post-employment or long-term employee benefits recorded
in the tax periods commencing on or after 1 January 2016, nor to deferred tax assets associated with them.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-
term employee benefits covered by it are deducted, under the terms and conditions set out in the Corporate
income tax Code and in relevant separate tax legislation, up to the limit of the taxable profit for the tax period
determined before these deductions. Expenses and negative equity variations not deducted due to this limit are
deducted in subsequent tax periods, with the same limit. In the BCP Group, deferred tax assets associated with
expenses and negative equity variations under these conditions amount to EUR 915,512,000 (31\u00a0December 2024:
EUR 1,152,769,000), of which EUR 697,542,000 relate to impairment losses on credits (31\u00a0December 2024: EUR
790,087,000) and EUR 217,970,000 relate to post-employment or long-term employee benefits (31\u00a0December 2024:
EUR 362,682,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorisation), deferred tax assets covered
by the Special Regime are converted into tax credits, in part or in full. In case of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period
and the total of equity, a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights of equivalent value attributable to the State are also constituted. These rights
that can be acquired by the shareholders upon payment to the State of the same value. Tax credits may be offset
against tax debts of the beneficiaries (or an entity based in Portugal within the same prudential consolidation
scope or included in the same group of entities for which are applied the Special Tax Regime for Groups of
Companies) or repaid by the State. Since neither Banco Comercial Portugu\u00eas nor Banco ActivoBank recorded net
losses in the years 2015 to 2025, there was no conversion of deferred taxes assets into tax credits, under the terms
provided for in the Special Regime.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by
Law 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law 98/2019, of 4 September,
establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after which the
Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these
rights are subject to a right of acquisition by the shareholders on the date of creation of the rights of the State,
exercisable in periods that will be established by the Board of Directors until 3 years after the confirmation date of
the conversion of the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing
entity shall deposit in favour of the State the amount of the price corresponding to all the rights issued, within 3
months beginning from the confirmation date of the conversion of the deferred tax asset into tax credit. Such
deposit shall be redeemed when and to the extent that the rights of the State are acquired by the shareholders or
exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the tax rates enacted or substantively enacted at the balance sheet date. The
deferred tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law,
current tax assets and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities
related to income taxes levied by the same tax authority over the same taxable entity.
Under Law 45-A/2024, of 31 December, which approved the State Budget for 2025, the standard IRC rate was
reduced from 21% to 20%.
The current tax rate for Banco Comercial Portugu\u00eas, S.A. is analysed as follows:
2025
2024
Income tax
20%
21%
Municipal surtax rate (on taxable net income)
1.5%
1.5%
State tax rate (on taxable net income)
More than 1,500,000 to 7,500,000
3%
3%
From more than 7,500,000 to 35,000,000
5%
5%
More than 35,000,000
9%
9%
Law No. 64/2025, of 7 November, was published, which changes the general IRC (Corporate Income Tax) to 19%,
18% and 17% for tax periods beginning in 2026, 2027 and in or after 2028, respectively.
Following these changes:
The deferred tax rate related to the Bank\u2019s tax losses as at 31 December 2025 is 17% (31\u00a0December 2024 : 20%).
The average deferred tax rate associated with temporary differences of Banco Comercial Portugu\u00eas, S.A. as at 31
December 2025 is 28% (31\u00a0December 2024: 30,3%).
The income tax rate in the other main countries where the Group operates is 19% in Poland and 32% in
Mozambique.
Starting in 2026, the income tax rate for banks in Poland will increase to 30%, decreasing to 26% in 2027 and to 23%
in 2028.
Following this change, the average rate of deferred taxes associated with temporary differences for Bank
Millennium, S.A. as at 31 December 2025, is 22.4% (31 December 2024: 19%).
The reporting period for tax losses carried forward in Poland and in Mozambique is 5 years.
Following the amendments provided for in Law 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This
amendment applies to tax losses assessed in tax periods beginning on or after 1 January 2023, as well as to tax
losses calculated in tax periods prior to 1 January 2023 and whose deduction period is still in progress on that date.
Thus, tax losses calculated in 2014 and subsequent years may be deducted from future taxable income. The
deduction limit for tax losses reduced from 70% to 65%, being increased by ten percentage points when the
difference results from the deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of
the special regime provided for in Law 27-A/2020, of 24 July.
Banco Comercial Portugu\u00eas, S.A. applies the Special Tax Regime for Groups of Companies (RETGS) since 2016 for
taxation purposes under corporate income tax (IRC), in which it\u2019s the dominant company.\u00a0The remaining
companies covered by the RETGS are Banco ActivoBank, S.A., Interfundos - Sociedade Gestora de Organismos de
Investimento Coletivo, S.A., BCP \u00c1frica, S.G.P.S. Lda., Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade Unipessoal
Lda., Millennium bcp Teleservi\u00e7os \u2013 Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico, S.A., and, from 2024, Imoserit, S.A.
Regarding the activity in Portugal, Law No. 98/2019, of 4 September, established the tax regime for credit
impairment losses and provisions for guarantees for tax periods beginning on or after 1 January 2019, providing for
the approximation between the accounting and tax rules in what concerns the deductibility of credit impairment
losses. The rules in force until 2018 could continue to be applied until the end of the 2023 financial year, unless the
option to apply the new regime was exercised in advance.
In 2022, the Banco Comercial Portugu\u00eas, S.A. and the Banco ActivoBank, S.A. exercised the option to apply the
new regime, under which impairment losses for credit risk relating to exposures analysed on an individual or
collective basis recognised in accordance with applicable accounting and regulatory standards, the provisions for
guarantees and other commitments, and impairment losses on debt instruments at amortised cost or at fair value
through Other Comprehensive Income, are fully deductible for the purposes of determining taxable profit, with
the exceptions provided for in the Corporate Income Tax Code. The exceptions apply to impairment losses relating
to credits and other rights over natural or legal persons who hold, directly or indirectly, more than 10 % of the
Bank's capital, over members of its corporate bodies, over companies in which the Bank holds, directly or
indirectly, more than 10 % of the capital or over entities with which it is in a situation of special relations.
Impairment losses and other value corrections for specific credit risk recorded until 31 December 2021 and still not
deducted for tax purposes are only deductible up to the amount that, in each tax period, corresponds to the
application of the mandatory minimum limits set out in Notice of Banco de Portugal No. 3/95, as amended before
its repeal by Notice of Banco de Portugal 5/2015 and, between other conditions, provided that they are not claims
covered by real estate rights.
The Group complies with the guidelines of IFRIC 23 - Uncertainty over Income Tax Treatments on the
determination of taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in
scenarios of uncertainty regarding the income tax treatment, with no material impact on its financial statements
resulting from its application.
Analysis of the recoverability of deferred tax assets
In accordance with the accounting policy 1 Y3 and with the requirements of IAS 12, the deferred tax assets were
recognised based on the Group's expectation of their recoverability. The recoverability of deferred taxes depends
on the implementation of the strategy of the Bank's Board of Directors, namely the generation of estimated
taxable income and its interpretation of tax legislation. Any changes in the assumptions used in estimating future
profits or tax legislation may have material impacts on deferred tax assets.
The assessment of the recoverability of deferred tax assets is based on the projected results for the period from
2026 to 2032, as longer forecast periods have higher underlying factors of uncertainty. The projected income
before taxes for the years 2026, 2027 and 2028 is consistent with the budget approved by the Bank's Board of
Directors in November 2025, which incorporates the priorities stemming from the 2025-2028 Strategic Plan. In the
earnings forecast for the years 2029, 2030, 2031 and 2032, a standard nominal growth rate of 2% was considered.
The forecasts consider the conclusion of the monetary policy easing cycle in the Eurozone, with the stabilisation of
interest rates and the development of the Bank\u2019s activity aligned with the commercial positioning and the targets
enshrined in the 2025-2028 Strategic Plan approved by the governing bodies, highlighting:
- after reflecting the impacts of the normalisation of interest rates, net interest income benefits from the recovery
of volumes in customer lending, especially to companies, with a focus on priority segments associated with
customer knowledge and relationship, and continued growth of the deposit base, focusing on customer
engagement and transactionality;
- increase in commission income based on an efficient and judicious management of commissions and price lists;
- stabilisation of cost of risk at levels in line with the Group's current activity, given the lower impact from the
historical portfolios of NPEs, foreclosed assets and FRE (Corporate Restructuring Funds), after the reduction of
these exposures achieved over the last years;
- strengthening of the capabilities required for the implementation of the initiatives foreseen in the 2025-2028
Strategic Plan, while preserving high levels of efficiency based on continued cost discipline and increased use of
technology.
To estimate taxable net income for the periods of 2026 to 2032, the following main assumptions were considered:
- The rules of the new tax regime of credit impairment were applied. In the application of these rules, the following
assumptions were considered, in general terms:
a) the impairment losses for credit risk related to exposures analysed on an individual or collective basis,
recognised in accordance with the applicable accounting and regulatory standards, were considered deductible
for tax purposes;
b) impairment reversals created up to 31 December 2021 not accepted for tax purposes were estimated based on
the most recent Non-Performing Assets Reduction Plan (2025-2027), and also on the basis of the average
percentage of reversal observed in the last years from 2016 to 2025;
c) the referred average percentages were calculated separately, depending on whether or not there was a
mortgage guarantee, the eligibility for purposes of the special regime applicable to deferred tax assets and
according to the customers\u2019 classification as Non-Performing Exposures (NPE).
- The increase in provisions for guarantees was considered, as fully, as deductible for tax purposes, under the terms
of the current rules. Reversals of provisions taxed until 31 December 2021 are being estimated based on the
percentage of impairment replacement taxed for the years 2022 to 2025.
- The deductions related to impairment of financial assets were projected based on the destination (sale or
settlement) and the estimated date of the respective operations;
- Impairment reversals of non-financial assets not accepted for tax purposes were projected considering the
expected periods of disinvestment in certain real estate assets. For the remaining assets without a forecasted
term for disinvestment, the reversals were estimated based on the average percentage of reversal observed in the
years from 2016 to 2025. Non-deductible expenses related to the reinforcement of impairment of non-financial
assets were estimated on the based on the average percentage of amounts not deducted for tax purposes in the
years from 2016 to 2025, compared to the amounts of reinforcements net of impairment recorded in those years;\u00a0
- The deductions related to employee benefits were projected based on their estimated payments or deduction
plans, in accordance with information provided by the pension fund actuary;\u00a0
- The realisation of changes in the fair value of real estate investment funds and venture capital funds classified as
equity instruments, was projected based on the information available in the regulations of the funds in question in
relation to the period foreseen for the respective liquidation.
According to the estimate of future taxable income, the deferred taxes assets recorded as at 31 December 2025 are
adequate under the IAS 12 requirements.
(Thousands of euros)
2025
2024
Temporary differences
990
1,072
Tax losses carried forward
2014
131,067
154,196
2015
2
2
2016
102,610
265,652
2017
2,245
2,347
2018
78,534
92,394
2019
21,675
25,500
2020
4,009
19,481
2021
146,886
172,782
2022
14,482
18,569
2023
2,547
3,851
2024
22,595
17,661
2025
40,432
\u2014
Total
567,084
772,435
The amount of unrecognised deferred taxes relating to tax losses per expiry year is analysed as follows:
(Thousands of euros)
2025
2024
2025
\u2014
14,558
2026
132
131
2027
11,247
11,565
2028
885
1,008
2029
18,886
21,503
2030
40,237
\u2014
No expiry date
495,697
723,670
Total
567,084
772,435
In addition to the above amounts, the Bank is contesting corrections to tax losses for 2014, 2016, 2021 and 2022,
which, if granted, will increase the value of unrecognised deferred taxes assets by EUR 81,613,000.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2025, is
analysed as follows:
(Thousands of euros)
2025
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(98,484)
\u2014
\u2014
Employee benefits
(145,914)
(22,908)
\u2014
(244,398)
(22,908)
\u2014
Deferred taxes depending on the future profits
Impairment losses
(36,038)
(1,311)
8,449
Tax losses carried forward (a)
83,636
7,885
37
Employee benefits
11,253
(37,172)
1,348
Financial assets at fair value through other comprehensive income
\u2014
(155,291)
(18,722)
Derivatives
5,592
\u2014
(87)
Intangible assets
229
\u2014
14
Other tangible assets
299
\u2014
(5)
Other
(126,418)
(303)
16,434
(61,447)
(186,192)
7,468
(305,845)
(209,100)
7,468
Current taxes
Current year
(124,772)
(1)
\u2014
Correction of previous years (b)
21,937
\u2014
\u2014
(102,835)
(1)
\u2014
(408,680)
(209,101)
7,468
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
(b) In 2025, this mainly relates to the tax credit that Bank Millennium benefited from credit write-off agreements with customers who had mortgage
credit agreements in Swiss francs and which,\u00a0 in turn, led to the reduction in deferred tax assets previously recorded in relation to provisions set up for
these contingencies.
The impact of income taxes in Net income and in other balances of Group's equity, as at 31 December 2024, is
analysed as follows:
(Thousands of euros)
2024
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(59,263)
\u2014
\u2014
Employee benefits
(180,816)
(12,042)
\u2014
(240,079)
(12,042)
\u2014
Deferred taxes depending on the future profits
Impairment losses
36,584
(656)
3,164
Tax losses carried forward (a)
(26,850)
6,890
120
Employee benefits
(1,100)
63,273
6
Financial assets at fair value through other comprehensive income
\u2014
(151,348)
(3,651)
Derivatives
(334)
\u2014
(124)
Intangible assets
29
\u2014
15
Other tangible assets
202
\u2014
(5)
Other
29,065
(5,215)
2,543
37,596
(87,056)
2,068
(202,483)
(99,098)
2,068
Current taxes
Current year
(148,600)
\u2014
\u2014
Correction of previous years
9,832
\u2014
\u2014
(138,768)
\u2014
\u2014
(341,251)
(99,098)
2,068
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity changes recorded
in reserves that contribute to the calculation of taxable income.
The impact of income taxes in Net income and in other balances of Group's equity, by geographies where the
Group operates, with reference to 31 December 2025 and 2024, is analysed as follows:
(Thousands of euros)
2025
2024
Portugal
Poland
Mozambique
Portugal
Poland
Mozambique
Current year
Deferred taxes
(279,519)
(26,326)
\u2014
(262,073)
61,007
(1,417)
Current taxes
(5,149)
(72,345)
(25,341)
(11,524)
(97,203)
(30,041)
(284,668)
(98,671)
(25,341)
(273,597)
(36,196)
(31,458)
Reserves and Exchange differences
Deferred taxes
(191,743)
(9,890)
\u2014
(90,312)
6,514
(204)
Current taxes
(1)
\u2014
\u2014
\u2014
\u2014
\u2014
(191,744)
(9,890)
\u2014
(90,312)
6,514
(204)
(476,412)
(108,561)
(25,341)
(363,909)
(29,682)
(31,662)
", "dimensions": { "concept": "ifrs-full:DisclosureOfDeferredTaxesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-697": { "value": "Other assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Deposit account applications
61,273
58,404
Shareholder Loans
107,790
121,188
Surplus in the post-employment benefits
283,686
148,229
Debtors for futures and options transactions
195,542
151,776
Real estate and other assets arising from recovered loans (*)
234,742
293,150
Debtors
Residents
Receivables from real estate,\u00a0transfers of assets and other securities
47,216
57,446
Prosecution cases / agreements with the Bank
8,521
8,795
SIBS
2,366
2,770
Other
24,217
34,182
Non-residents
26,546
23,890
Amounts due for collection (**)
106,535
113,333
Interest and other amounts receivable
83,183
84,653
Amounts receivable on trading activity
20,674
1,584
Amounts due from customers
9,487
103,144
Artistic assets
28,795
28,796
Prepaid expenses
33,453
26,716
Subsidies receivables
13,155
14,908
Other taxes recoverable
13,066
7,878
Gold and other precious metals
3,533
3,693
Capital supplementary contributions
109
165
Associates
39
489
Receivables due from Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A. (under an \u2018CHF Portfolio Indemnity and
Guarantee Agreement)
219,623
186,420
Receivables due to legally invalidated foreign currency mortgage loans
80,839
62,550
Other
204,388
206,983
1,808,778
1,741,142
Impairment for other assets
(253,611)
(276,896)
1,555,167
1,464,246
(*) Amounts of real estate and other assets that do not meet the requirements of IFRS 5 (accounting policy G).
(**) This mainly corresponds to the specific position of the financial flow with SIBS within the scope of transactions carried out via ATMs.
The balance Deposit account applications includes the amount of EUR 30,638,000 ( 31\u00a0December 2024: EUR
30,638,000) relating to the collateral constituted in compliance with the assumption of irrevocable payment
commitments to Single Resolution Fund, as referred in note 46.
As referred in note 48, as at 31\u00a0December 2025, the balance Shareholder Loans includes the amount of EUR
100,375,000 (31\u00a0December 2024: EUR 113,840 ,000) arising from the transfers of assets to Specialized recovery funds
for which there is an impairment loss of the same amount.
The balance Amounts receivable on trading activity corresponds to operations pending financial settlement,
which had already taken place on the date these accounts were approved.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is
to periodically assess the collectability of these amounts and whenever impairment is identified, an impairment
loss is recorded in the income statement.
The detail of the item Real estate and other assets arising from recovered loans is analysed as follows:
(Thousands of euros)
2025
2024
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
68,804
(35,864)
32,940
118,564
(49,917)
68,647
Assets belong to investments funds
and real estate companies
135,403
(77,353)
58,050
137,598
(77,518)
60,080
Assets for own use (closed branches)
9,153
(3,194)
5,959
12,328
(4,817)
7,511
Equipment
13,965
(10,148)
3,817
14,792
(9,204)
5,588
Other assets (*)
7,417
\u2014
7,417
9,868
(19)
9,849
234,742
(126,559)
108,183
293,150
(141,475)
151,675
(*) includes Shares, Price Deposit and Property Adjudication Proposals
The changes occurred in Impairment of other assets, with the exception of impairment for Real estate and other
assets arising from recovered loans are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
135,421
184,992
Other transfers
705
(113)
Charge for the year (note 13)
13,943
18,407
Reversals for the year (note 13)
(3,452)
(5,339)
Amounts charged-off
(19,260)
(62,825)
Exchange rate differences
(305)
299
Balance at the end of the year
127,052
135,421
The changes occurred in impairment for Real Estate and other assets arising from recovered loans, are analysed as
follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
141,475
136,840
Other transfers
(18,179)
(8,461)
Charge for the year (note 13)
11,880
33,875
Reversals for the year (note 13)
(215)
(407)
Amounts charged-off
(4,993)
(21,891)
Exchange rate differences
(3,409)
1,519
Balance at the end of the year
126,559
141,475
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherReceivablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-696": { "value": "Other assets
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Deposit account applications
61,273
58,404
Shareholder Loans
107,790
121,188
Surplus in the post-employment benefits
283,686
148,229
Debtors for futures and options transactions
195,542
151,776
Real estate and other assets arising from recovered loans (*)
234,742
293,150
Debtors
Residents
Receivables from real estate,\u00a0transfers of assets and other securities
47,216
57,446
Prosecution cases / agreements with the Bank
8,521
8,795
SIBS
2,366
2,770
Other
24,217
34,182
Non-residents
26,546
23,890
Amounts due for collection (**)
106,535
113,333
Interest and other amounts receivable
83,183
84,653
Amounts receivable on trading activity
20,674
1,584
Amounts due from customers
9,487
103,144
Artistic assets
28,795
28,796
Prepaid expenses
33,453
26,716
Subsidies receivables
13,155
14,908
Other taxes recoverable
13,066
7,878
Gold and other precious metals
3,533
3,693
Capital supplementary contributions
109
165
Associates
39
489
Receivables due from Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A. (under an \u2018CHF Portfolio Indemnity and
Guarantee Agreement)
219,623
186,420
Receivables due to legally invalidated foreign currency mortgage loans
80,839
62,550
Other
204,388
206,983
1,808,778
1,741,142
Impairment for other assets
(253,611)
(276,896)
1,555,167
1,464,246
(*) Amounts of real estate and other assets that do not meet the requirements of IFRS 5 (accounting policy G).
(**) This mainly corresponds to the specific position of the financial flow with SIBS within the scope of transactions carried out via ATMs.
The balance Deposit account applications includes the amount of EUR 30,638,000 ( 31\u00a0December 2024: EUR
30,638,000) relating to the collateral constituted in compliance with the assumption of irrevocable payment
commitments to Single Resolution Fund, as referred in note 46.
As referred in note 48, as at 31\u00a0December 2025, the balance Shareholder Loans includes the amount of EUR
100,375,000 (31\u00a0December 2024: EUR 113,840 ,000) arising from the transfers of assets to Specialized recovery funds
for which there is an impairment loss of the same amount.
The balance Amounts receivable on trading activity corresponds to operations pending financial settlement,
which had already taken place on the date these accounts were approved.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is
to periodically assess the collectability of these amounts and whenever impairment is identified, an impairment
loss is recorded in the income statement.
The detail of the item Real estate and other assets arising from recovered loans is analysed as follows:
(Thousands of euros)
2025
2024
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
68,804
(35,864)
32,940
118,564
(49,917)
68,647
Assets belong to investments funds
and real estate companies
135,403
(77,353)
58,050
137,598
(77,518)
60,080
Assets for own use (closed branches)
9,153
(3,194)
5,959
12,328
(4,817)
7,511
Equipment
13,965
(10,148)
3,817
14,792
(9,204)
5,588
Other assets (*)
7,417
\u2014
7,417
9,868
(19)
9,849
234,742
(126,559)
108,183
293,150
(141,475)
151,675
(*) includes Shares, Price Deposit and Property Adjudication Proposals
The changes occurred in Impairment of other assets, with the exception of impairment for Real estate and other
assets arising from recovered loans are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
135,421
184,992
Other transfers
705
(113)
Charge for the year (note 13)
13,943
18,407
Reversals for the year (note 13)
(3,452)
(5,339)
Amounts charged-off
(19,260)
(62,825)
Exchange rate differences
(305)
299
Balance at the end of the year
127,052
135,421
The changes occurred in impairment for Real Estate and other assets arising from recovered loans, are analysed as
follow:
(Thousands of euros)
2025
2024
Balance as at 1 January
141,475
136,840
Other transfers
(18,179)
(8,461)
Charge for the year (note 13)
11,880
33,875
Reversals for the year (note 13)
(215)
(407)
Amounts charged-off
(4,993)
(21,891)
Exchange rate differences
(3,409)
1,519
Balance at the end of the year
126,559
141,475
", "dimensions": { "concept": "ifrs-full:DisclosureOfPrepaymentsAndOtherAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-699": { "value": "Deposits from credit institutions and other funds
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from Central Banks
and other funds
Central Banks abroad
\u2014
200,601
200,601
\u2014
116,330
116,330
Deposits from credit institutions in
Portugal and other funds
Very short-term deposits
\u2014
\u2014
\u2014
\u2014
30,908
30,908
Sight deposits
98,802
\u2014
98,802
80,839
\u2014
80,839
Term Deposits
\u2014
104,161
104,161
\u2014
187,655
187,655
98,802
104,161
202,963
80,839
218,563
299,402
Deposits from credit institutions
abroad and other funds
Demand deposits
75,497
\u2014
75,497
65,217
\u2014
65,217
Term deposits
\u2014
107,083
107,083
\u2014
139,446
139,446
Loans obtained
\u2014
401
401
\u2014
817
817
CIRS and IRS operations
collateralised by deposits (*)
36,366
\u2014
36,366
105,027
\u2014
105,027
Sales operations with repurchase
agreement
\u2014
246,856
246,856
\u2014
45,414
45,414
Other
\u2014
8,804
8,804
\u2014
6,066
6,066
111,863
363,144
475,007
170,244
191,743
361,987
210,665
667,906
878,571
251,083
526,636
777,719
(*) Under the scope of transactions involving derivative financial instruments (IRS and CIRS) with institutional counterparties, and in accordance
with the terms of their respective agreements (\"Cash collateral\"). These deposits are held by the Group and are reported as collateral for the
referred operations (IRS and CIRS), whose revaluation is positive.
This balance is analysed, by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
822,187
676,932
3 to 6 months
22,066
90,266
6 to 12 months
33,920
10,521
1 to 5 periods
398
\u2014
878,571
777,719
Deposits from customers and other funds
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from customers
Repayable on demand
52,477,872
990,661
53,468,533
47,313,543
598,911
47,912,454
Term deposits
\u2014
29,114,003
29,114,003
\u2014
29,300,652
29,300,652
Saving accounts
\u2014
4,580,066
4,580,066
\u2014
4,063,719
4,063,719
Cheques and orders to pay
352,055
\u2014
352,055
469,282
\u2014
469,282
52,829,927
34,684,730
87,514,657
47,782,825
33,963,282
81,746,107
Corrections to the liabilities
value subject to hedging
operations
38,521
158,201
Interests payable
119,682
180,379
87,672,860
82,084,687
In the terms of the Law, the Deposit Guarantee Fund was established to guarantee the repayment of funds
deposited in Credit Institutions. The criteria to calculate the annual contributions to the Portuguese fund are
defined in the Regulation no. 11/94 of the Banco de Portugal.
According to accounting policy C.4, there is a set of deposits from customers and other loans that are being
hedged, the impact of which is detailed in note 55.
This balance is analysed, by remaining period until the next operation renewal date, as follows:
(Thousands of euros)
2025
2024
Deposits repayable on demand
53,469,091
47,913,078
Term deposits and saving accounts
Up to 3 months
24,391,945
22,653,111
3 to 6 months
6,754,709
8,075,114
6 to 12 months
2,500,446
2,415,851
1 to 5 years
204,614
558,251
33,851,714
33,702,327
Cheques and orders to pay
Up to 3 months
352,055
469,282
87,672,860
82,084,687
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
", "dimensions": { "concept": "ifrs-full:DisclosureOfBorrowingsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-698": { "value": "Deposits from credit institutions and other funds
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from Central Banks
and other funds
Central Banks abroad
\u2014
200,601
200,601
\u2014
116,330
116,330
Deposits from credit institutions in
Portugal and other funds
Very short-term deposits
\u2014
\u2014
\u2014
\u2014
30,908
30,908
Sight deposits
98,802
\u2014
98,802
80,839
\u2014
80,839
Term Deposits
\u2014
104,161
104,161
\u2014
187,655
187,655
98,802
104,161
202,963
80,839
218,563
299,402
Deposits from credit institutions
abroad and other funds
Demand deposits
75,497
\u2014
75,497
65,217
\u2014
65,217
Term deposits
\u2014
107,083
107,083
\u2014
139,446
139,446
Loans obtained
\u2014
401
401
\u2014
817
817
CIRS and IRS operations
collateralised by deposits (*)
36,366
\u2014
36,366
105,027
\u2014
105,027
Sales operations with repurchase
agreement
\u2014
246,856
246,856
\u2014
45,414
45,414
Other
\u2014
8,804
8,804
\u2014
6,066
6,066
111,863
363,144
475,007
170,244
191,743
361,987
210,665
667,906
878,571
251,083
526,636
777,719
(*) Under the scope of transactions involving derivative financial instruments (IRS and CIRS) with institutional counterparties, and in accordance
with the terms of their respective agreements (\"Cash collateral\"). These deposits are held by the Group and are reported as collateral for the
referred operations (IRS and CIRS), whose revaluation is positive.
This balance is analysed, by remaining period, as follows:
(Thousands of euros)
2025
2024
Up to 3 months
822,187
676,932
3 to 6 months
22,066
90,266
6 to 12 months
33,920
10,521
1 to 5 periods
398
\u2014
878,571
777,719
", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-700": { "value": "Deposits from customers and other funds
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from customers
Repayable on demand
52,477,872
990,661
53,468,533
47,313,543
598,911
47,912,454
Term deposits
\u2014
29,114,003
29,114,003
\u2014
29,300,652
29,300,652
Saving accounts
\u2014
4,580,066
4,580,066
\u2014
4,063,719
4,063,719
Cheques and orders to pay
352,055
\u2014
352,055
469,282
\u2014
469,282
52,829,927
34,684,730
87,514,657
47,782,825
33,963,282
81,746,107
Corrections to the liabilities
value subject to hedging
operations
38,521
158,201
Interests payable
119,682
180,379
87,672,860
82,084,687
In the terms of the Law, the Deposit Guarantee Fund was established to guarantee the repayment of funds
deposited in Credit Institutions. The criteria to calculate the annual contributions to the Portuguese fund are
defined in the Regulation no. 11/94 of the Banco de Portugal.
According to accounting policy C.4, there is a set of deposits from customers and other loans that are being
hedged, the impact of which is detailed in note 55.
This balance is analysed, by remaining period until the next operation renewal date, as follows:
(Thousands of euros)
2025
2024
Deposits repayable on demand
53,469,091
47,913,078
Term deposits and saving accounts
Up to 3 months
24,391,945
22,653,111
3 to 6 months
6,754,709
8,075,114
6 to 12 months
2,500,446
2,415,851
1 to 5 years
204,614
558,251
33,851,714
33,702,327
Cheques and orders to pay
Up to 3 months
352,055
469,282
87,672,860
82,084,687
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromCustomersExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-701": { "value": "Subordinated debt
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Bonds
Non-Perpetual
1,382,228
1,407,796
Corrections to the liabilities value subject to hedging operations (note 55)
(10,783)
(17,808)
Deferred costs / (income)
(2,232)
(1,142)
Interests payable
42,445
38,513
1,411,658
1,427,359
According to accounting policy C.4, there is a set of debt securities that are being hedged, the impact of which is
detailed in note 55.
As at 31\u00a0December 2025 , the subordinated debt issues are analysed as follows:
(Thousands of euros)
2025
Issue
Issue
date
Repayment
date
Interest
rate
Nominal
value
Book
value
Own funds
value (*)
Banco Comercial Portugu\u00eas
Bcp Fix Rate Reset Sub Notes-Emtn
854
December,
2017
December,
2027
See reference (i)
86,800
86,792
33,560
BCP Tier 2 Subord Callable Notes
Due May 2032 - MTN 858
November,
2021
May, 2032
See reference (ii)
300,000
298,697
298,700
BCP2022 Tier 2 Sub Callable Notes
Due 2 June 2033 MTN 860
December,
2022
March, 2033
See reference (iii)
133,700
142,774
142,773
BCP2025 Tier2 Sub Callable Notes
Due 20 March 2037 MTN 863
March, 2025
March, 2037
See reference (iv)
500,000
514,475
513,953
Bank Millennium
Bank Millennium - BKMO_071227R
December,
2017
December,
2027
6.31%
165,767
166,447
34,564
Bank Millennium - BKMO_300129W
January, 2019
January, 2029
7.09%
196,552
202,429
40,983
Magellan No. 3
Magellan No. 3 Series 3 Class F
June, 2005
May, 2058
-
44
44
\u2014
1,411,658
1,064,533
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following years: mid-swap rate in force at the beginning of this period + 4.267%.
(ii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the mid-swap rates
of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the 5-year mid swaps rate prevailing
at that time plus the Spread.
(iii) Fixed annual interest rate of 8.75% during the first 5 years and 3 months. The annual interest rate from 5 years and 3 months onwards was set at
the 5-year mid-swap rate plus a 6.051%.
(iv) Rate of 4.75% per annum during the first 7 years; 8th year and following years: mid-swap rate in force at the beginning of this period + 2.15%.
As described in note 49, Banco Comercial Portugu\u00eas, S.A. has exercised its option to early redeem all of its
EUR450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 (ISIN: PTBIT3OM0098), issued on 27
September 2019 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d).
As at 31\u00a0December 2024, the subordinated debt issues are analysed as follows:
(Thousands of euros)
2024
Issue
Issue
date
Repayment
date
Interest
rate
Nominal
value
Book
value
Own
funds
value (*)
Banco Comercial Portugu\u00eas
Bcp Fix Rate Reset Sub Notes-Emtn
854
December,
2017
December,
2027
See reference (i)
166,300
167,306
97,540
Bcp Subord Fix Rate Note Projeto
Tagus Mtn 855
September,
2019
March, 2030
See reference (ii)
450,000
459,580
459,581
BCP Tier 2 Subord Callable Notes
Due May 2032 - MTN 858
November,
2021
May, 2032
See reference (iii)
300,000
293,154
293,154
BCP2022 Tier 2 Sub Callable Notes
Due 2 June 2033 MTN 860
December,
2022
March, 2033
See reference (iv)
133,700
141,962
141,962
Bank Millennium
Bank Millennium - BKMO_071227R
December,
2017
December,
2027
8.08%
163,678
164,548
43,384
Bank Millennium - BKMO_300129W
January, 2019
January, 2029
8.17%
194,075
200,765
51,441
Magellan No. 3
Magellan No. 3 Series 3 Class F
June, 2005
May, 2058
-
44
44
\u2014
1,427,359
1,087,062
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following years: mid-swap rate in force at the beginning of this period + 4.267%;
(ii) Annual interest rate of 3.871% during the first 5.5 years (corresponding to a spread of 4.231% over the 5.5-year mid-swap rate, for the remaining 5
years will be applied over the mid-swap rate in force at the beginning of that period).
(iii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the mid-swap rates
of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the 5-year mid swaps rate prevailing
at that time plus the Spread.
(iv) Fixed annual interest rate of 8.75% during the first 5 years and 3 months. The annual interest rate from 5 years and 3 months onwards was set at
the 5-year mid-swap rate plus a 6.051%.
The analysis of the subordinated debt by remaining period, is as follows:
(Thousands of euros)
2025
2024
1 to 5 years
455,668
532,619
Over 5 years
955,990
894,740
1,411,658
1,427,359
", "dimensions": { "concept": "ifrs-full:DisclosureOfSubordinatedLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-702": { "value": "Financial liabilities held for trading
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Short sales
8,949
44,607
Trading derivatives (note 24)
\u00a0 Swaps
114,320
84,308
\u00a0 Options
23,394
45,140
of which: Embedded derivatives
22,531
42,477
Forwards
6,066
5,572
143,780
135,020
152,729
179,627
Level 2
120,807
91,526
Level 3
31,922
88,101
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 50.
The balance Financial liabilities held for trading includes, as at 31\u00a0December 2025, the embedded derivatives
valuation separated from the host contracts in accordance with the accounting policy presented in note 1 C5. in
the amount of EUR 22,531,000 (31\u00a0December 2024: EUR 42,477,000). This note should be analysed together with
note 24.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialLiabilitiesHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-703": { "value": "Provisions
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Provision for guarantees and other commitments
146,156
118,039
Other provisions for liabilities and charges
1,092,357
967,819
1,238,513
1,085,858
Changes in Provisions for guarantees and other commitments are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
118,039
121,574
Transfers
\u2014
(1,105)
Charge for the year (note 14)
79,248
34,826
Reversals for the year (note 14)
(51,165)
(37,481)
Exchange rate differences
34
225
Balance at the end of the year
146,156
118,039
Changes in Other provisions for liabilities and charges are analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
967,819
631,529
Transfers
5,193
(9,801)
Charge for the year (note 14)
523,282
588,351
Reversals for the year (note 14)
(18,348)
(4,672)
Amounts charged-off
(399,464)
(171,771)
Allocation to loan's portfolio (note 22)
4,485
(75,275)
Exchange rate differences
9,390
9,458
Balance at the end of the year
1,092,357
967,819
The balance Other provisions for liabilities and charges - Charge for the year refers essentially to provisions for
legal risk accounted for by Bank Millennium, related to foreign currency-indexed mortgage loans, as described in
note 58, which amounted to EUR 480,973,000 (31\u00a0December 2024 : EUR 506,195,000).
The Other provisions for liabilities and charges were based on the probability of occurrence of certain
contingencies related to risks inherent to the Group's activity, being reviewed at each reporting date in order to
reflect the best estimate of the amount and respective probability of payment.
This balance includes provisions for lawsuits, frauds and tax contingencies. The provisions constituted to cover tax
contingencies amounted to EUR 52,587,000 (31\u00a0December 2024: EUR 55,927,000).
Additionally, there are provisions for liabilities and charges recorded for corporate restructuring funds and carved-
out assets of the Project Crow.
Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium
(Poland)
Bank Millennium estimated the impact of legal risk on the recoverability of the expected cash flows resulting from
concluded contracts for the active portfolio of mortgage loans in CHF, adjusting, in accordance with point B5.4.6
of IFRS 9, the gross carrying amount of the portfolio by reducing the expected cash flows from mortgage loan
contracts denominated or indexed to CHF, and recognised a provision in accordance with International
Accounting Standard 37 Provisions, Contingent Liabilities and Contingent Assets (\u201cIAS 37\u201d) for fully repaid loans
and in a situation where the gross carrying amount of the loan was lower than the value of the assessed risk.
A detailed description of the adopted valuation methodology is presented in note 58 \"Legal risk related to foreign
currency mortgage loans in Bank Millennium (Poland)\".
As at 31\u00a0December 2025, the Loans and advances to customers portfolio in CHF has a gross amount of EUR
1,043,576,000 (31\u00a0December 2024: EUR 1,642,802,000).
As at 31\u00a0December 2025, the provisions estimated by Bank Millennium to address the legal risk related with the
portfolio of foreign currency-indexed mortgage loans amount to EUR 1,684,540,000 (PLN 7,113,474,000), of which
EUR 869,230,000 (PLN 3,670,583,000) are presented under assets, as a deduction from the gross amount of the
loan portfolio in CHF (note 22) and EUR 815,310,000 (PLN 3,442,891,000) are presented under Provisions. \u00a0
As at 31\u00a0December 2024, the provisions estimated by Bank Millennium to address the legal risk related to foreign
currency-indexed mortgage loans amounted to EUR 1,979,025,000 (PLN 8,463,696,000), of which EUR
1,324,672,000 (PLN 5,665,224,000) are presented under assets, as a deduction from the gross amount of the loan
portfolio in CHF (note 22) and EUR 654,353,000 (PLN 2,798,472,000) are presented under Provisions.
The variation in the level of provisions or concrete losses will depend on the final court decisions about each case
and on the number of court cases, as described in accounting policy 1 Y7 and note 58.
Legal risk related to foreign currency mortgage loans in Bank Millennium
(Poland)
1. Court claims and current provisions for legal risk
On 31 December 2025, Bank Millennium had 16,653 loan agreements and additionally 2,285 loan agreements from
former Euro Bank under individual ongoing litigations (excluding claims submitted by Bank Millennium against
clients i.e. debt collection cases) concerning indexation clauses of FX mortgage loans submitted to the courts (43%
loans agreements before the courts of first instance and 57% loans agreements before the courts of second
instance) with the total value of claims filed by the plaintiffs amounting to PLN 3,551.2 million (EUR 841 million) and
CHF 293.2 million (EUR 315.1 million) [(Bank Millennium portfolio: PLN 3,057.8 million (EUR 724.1 million) and CHF
281.4 million (EUR 302.5 million) and former Euro Bank portfolio: PLN 493.4 million (EUR 116.8 million) and CHF 11.8
million (EUR 12.7 million)]. The original value of the portfolio of CHF agreements granted (the sum of tranches paid
to customers), taking into account the exchange rate as at the date of disbursement of loan tranches, amounted
to PLN 19.4 billion (EUR 4.6 billion) for 109 thousand loan agreements (Bank Millennium portfolio: PLN 18.3 billion
(EUR 4.3 billion) for 103.8 thousand loan agreements and former Euro Bank portfolio: PLN 1.1 billion (EUR 0.3 billion)
for 5.2 thousand loan agreements). Out of 16,653 Bank Millennium's loan agreements in ongoing individual cases
426 are also part of class action. From the total number of individual litigations against the Bank approximately
4,380 or 26% were submitted by borrowers that did not have any active loans with a CHF balance at the moment
of submission. Approximately another 1,170 cases correspond to loans that were fully repaid during the
proceedings (as court proceedings are lengthy).
The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the
contract and payment for reimbursement of paid principal and interest instalments as undue performance, due
to the abusive nature of indexation clauses, or maintenance of the agreement in PLN with interest rate indexed to
CHF Libor (currently CHF Saron).
In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to
determine the Bank's liability towards the group members based on unjust enrichment (undue benefit) ground in
connection with the foreign currency mortgage loans concluded. It is not a payment dispute. The judgment in
these proceedings will not directly grant any amounts to the group members. The number of credit agreements
currently covered by these proceedings is 1,389. Out of 1,389 loan agreements in class action 426 are also part of
ongoing individual cases, 27 concluded settlements and 15 received final verdicts (invalidation of loan agreement).
On 24 May 2022 the court issued a judgment on the merits, dismissing the claim in full. On 13 December 2022 the
claimant filed an appeal against the judgment of 24 May 2022. On 25 June 2024 an appeal hearing was held, at
which the Bank filed a motion to amend the composition of the group and exclude those group members who
had entered into an amicable settlement. The court required the plaintiffs' attorneys to take a written position on
the current composition of the group. On 31 January 2025, and then on 25 March 2025, 8 May 2025, 6 June 2025, 30
July 2025, 1 September 2025, 6 October 2025, 24 November 2025, 15 December 2025 and 13 January 2026, the court
issued orders setting aside the judgment and discontinuing the proceedings from the persons who entered into
amicable settlements. On January 19, 2026, another appellate hearing took place, during which the Court obliged
both the claimant and the Bank to further specify the composition of the group. The next hearing date will be
scheduled ex officio.
Based on these orders, the number of credit agreements covered by the class action dropped from 3,273 to 1,389.
Until the end of 2019, 1,980 individual claims were filed against Bank Millennium (in addition, 235 against former
Euro Bank), in 2020 3,002 (265), in 2021 6,151 (421), in 2022 5,754 (407), in 2023 6,864 (645), in 2024 5,838 (655) and in
2025 3,712 (427).
As far as Bank Millennium (including the former Euro Bank portfolio) is concerned, from 2015 until the end of 2025,
17,730 cases were finally resolved (17,593 in claims submitted by clients against the Bank and 137 in claims
submitted by the Bank against clients i.e. debt collection cases) out of which 5,488 were settlements, 136 were
remissions, 89 rulings were favourable for the Bank and 12,017 were unfavourable including both invalidation of
loan agreements as well as conversions into PLN+LIBOR (currently Saron). Bank Millennium undertakes proper
legal actions in order to secure repayment of initially disbursed capital of the loan.
The methodology developed by Bank Millennium of calculating provisions for legal risk involved with indexed
loans is based on the following main parameters:
(1) the number of ongoing cases (including class action agreements);
(2) the number of potential future court cases, the Bank monitors customer behaviours, analyses their willingness
to sue the Bank, including due to economic factors and applies the following assumptions:
a. regarding active loans (i.e., loans with an outstanding balance), the Bank estimates that approximately
18% of them will neither sign an out-of-court settlement nor decide to file a lawsuit;
b. regarding loans already fully repaid or converted to polish zloty, the Bank anticipates that approximately
4.7 thousand repaid loans - those which were not previously subject to a settlement - may result in future
litigation initiated by the borrowers. The impact on the level of provisions of a change by 100 clients
(assuming recent inflow structure) would be around PLN 14.4 million (EUR 3.4 million);
(3) the amount of the Bank's potential loss in the event of a specific court judgment (including statutory interest
estimation significantly dependent on the period for which they are awarded);
(4) estimates involved with amicable settlements with clients, concluded in court or out of court.
As a result of negotiations, the number of active FX mortgage loans originated by Bank Millennium decreased by
30,369. As of the end of 2025, the Bank had 14,741 active FX mortgage loans.
The costs regarding to legal risk related to foreign\u2011currency mortgage loans are presented in the following table:
31 December 2025
31 December 2024
Item
note
thousand PLN
thousand EUR
thousand PLN
thousand EUR
Results on modification
10
10,584
2,499
146,600
34,055
Other operating income/(expenses)
6
33,864
7,994
121,155
28,144
Foreign exchange gains/(losses)
5
22,339
5,274
403,405
93,711
Charge of other provisions
14
2,037,431
480,973
2,179,070
506,195
Total costs
2,104,218
496,740
2,850,230
662,105
Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A.
Over the past years, the Court of Justice of the European Union (CJEU) has interpreted a number of legal issues
concerning disputes in the area of foreign currency housing loan agreements. As a result of these actions, the
legal assessments of national courts regarding claims submitted by borrowers have been significantly unified. The
established line of case law is generally favourable to consumers, and the legal arguments put forward by banks,
including those referring to principles of fairness, are taken into account only to a limited extent.
It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further
examined by the domestic courts and the European Court of Justice which could potentially result in the further
interpretations, that are relevant for the assessing of the risks associated with proceedings.
The issues related to the statute of limitations for the Bank Millennium's and the customer's restitutionary claims
following the invalidation of a loan agreement remain an area that may be subject to further analysis in the
jurisprudence of Polish courts. Legal interpretations in this subject may have an impact for the amount of
provisions in the future.
There is a need for constant analysis of these matters. Bank Millennium will have to regularly review and may need
to continue to create additional provisions for FX mortgage legal risk, taking into consideration not only the above
mentioned developments, but also the negative verdicts in the courts regarding FX mortgage loans and
important parameters, such as the number of new customer claims, including those relating to repaid loan
agreements.
On 2 October 2025, the Council of Ministers adopted a draft act on special solutions for the examination of cases
concerning loan agreements denominated or indexed to the Swiss franc and referred it to the Parliament. The first
reading of the draft act took place on 16 October 2025. The draft was referred for further parliamentary work.
The bill aims to create new regulations enabling courts to consider Swiss franc cases faster and more effectively.
Its primary task is to relieve the judiciary, by accelerating the examination of Swiss franc cases.
At present, the Bank Millennium is unable to estimate the impact of the ongoing legislative work on the Bank\u2019s
Financial Statements, but it does not alter the Bank\u2019s strategic approach, which remains focused on the amicable
resolution of disputes with clients through the conclusion of settlement agreements.
Selected theses and decisions of the CJEU and the Supreme Court that have shaped the line
of jurisprudence.
Case law of the Court of Justice of the European Union
On 3 October 2019, in case C 260/18, the CJEU ruled that a national court may annul a credit agreement if the
removal of unfair terms identified in that agreement would alter the nature of the main subject matter of the
contract, and that it is excluded to fill the gaps in the agreement caused by the removal of unfair terms solely on
the basis of national legislation of a general nature or on the basis of accepted customs. The Court also found that
the consumer, if he or she so wishes, may maintain the agreement in force.
On 10 June 2021, the CJEU found that the protection provided for in Directive 93/13/EEC applies to every consumer,
and not only to one who may be regarded as a \u201creasonably well informed, observant and circumspect average
consumer\u201d.
With regard to the definition of a consumer, on 8 June 2023, in case C 570/21, the CJEU ruled that the notion of
\u201cconsumer\u201d within the meaning of Directive 93/13 also includes a person who concluded a credit agreement for
use partly related to his or her business or professional activity.
On 15 June 2023, in case C 520/21, the CJEU, referring to the issue of settlements between the bank and the
consumer as a consequence of the annulment of a credit agreement, explained that the provisions of Directive
93/13 preclude a judicial interpretation of national law under which a credit institution has the right to demand
from the consumer compensation exceeding the return of the capital disbursed under the performance of that
agreement, as well as exceeding statutory default interest from the date of the demand for payment.
On 21 September 2023, in case C 139/22, the Court ruled that it is possible to consider a contractual term unfair
solely because its content is equivalent to the content of a clause included in the national register of unfair terms.
Moreover, the CJEU held that a contractual term found to be unfair cannot lose that character because of another
provision of the same agreement that provides the consumer with the possibility of performing obligations under
different conditions. Furthermore, the trader is obliged to inform the concerned consumer about the essential
features of the agreement concluded with him or her, as well as about the risks connected with that agreement,
even if that consumer is the trader\u2019s employee and has relevant knowledge in the field of that agreement.
On 7 December 2023, in case C 140/22, the Court ruled that the exercise of a consumer\u2019s rights cannot be made
conditional upon the consumer submitting to the court, in particular, a statement declaring that he or she agrees
to the recognition of the agreement as null and void.
On 14 December 2023, in case C 28/22, the Court ruled that the limitation period for the trader\u2019s claims arising from
the invalidity of the agreement cannot begin later than the limitation period for the consumer\u2019s claims arising
from the invalidity of that agreement. The Court also indicated, among other things, that the trader cannot rely on
the right of retention that would allow him to make the return of the benefits received from the consumer
conditional upon the consumer offering to return the benefits he or she received, if the exercise of this right of
retention would cause the consumer to lose the right to obtain default interest.
The Court of Justice of the European Union on 19 June 2025 issued a judgment in case C 396/24. The Court stated
in particular that a trader, in the case of the invalidity of the agreement, may not demand from the consumer the
return of the entire nominal amount of the credit granted, regardless of the amount of repayments made by the
consumer under that agreement and regardless of the amount remaining to be repaid.
In its judgment of 27 November 2025, in case C 746/24, the CJEU addressed the possibility of charging the
consumer with the costs of legal proceedings lost by the consumer concerning the repayment of the capital
disbursed by the bank. The Court found that it is not permissible to charge the consumer with costs that
significantly exceed the costs that the consumer would have had to bear had he or she lost the case in
proceedings initiated to challenge the unfairness of the credit agreement terms.
On 11 December 2025, in case C 767/24, the CJEU held that in the event of the invalidity of a credit agreement, the
submission by the consumer of a statement on the set off of his or her claim with the bank\u2019s claim does not entail
an implied waiver of the statute of limitations defence.
On 22 January 2026 in case C 902/24, the CJEU stated that the provisions of Directive 93/13 do not preclude a
judicial interpretation of national law that, within proceedings initiated by a consumer for the purpose of
establishing the invalidity of a mortgage loan agreement, allows the trader, while maintaining as the main
argument that the agreement is valid, to raise alternatively a set off defence based on a claim corresponding to
the amount of that mortgage loan, provided that, first, that latter claim is not considered due before the
competent court establishes the invalidity of the agreement itself, and second, that the acceptance of such a
defence does not lead to a decision on costs that could discourage the consumer from exercising the rights
granted to him or her under that Directive.
Jurisprudence of the Polish Supreme Court
The case law of the Supreme Court remains consistent with the guidance of the Court of Justice of the European
Union.
On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the
meaning of legal principle has been granted, stating that:
1. An abusive contractual clause (art. 385(1) \u00a7 1 of the Civil Code), by force of the law itself, is ineffective to the benefit
of the consumer who may consequently give conscious and free consent to this clause and thus restore its
effectiveness retroactively.
2. If without the ineffective clause the loan agreement cannot bind, the consumer and the lender shall be eligible
for separate claims for return of monetary performances made in exercising this agreement (art. 410 \u00a7 1 in relation
to art. 405 of the Civil Code). The lender may demand return of the performance from the moment the loan
agreement becomes permanently ineffective.
On 28 April 2022 the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with
consumers, the provision of Article 358(1) of the Civil Code is a special provision to Article 353(1) of the Civil Code,
which means that if the prerequisites for the application of both provisions exist, the court should apply the
special provision and declare the contractual provision permanently ineffective, rather than invalid.
The effect of the Supreme Court's resolution of 7 May 2021 is that the bank is entitled to a refund of the cash
benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the
uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to
protect its interests, files lawsuits for payment against borrowers in a court dispute with the Bank and in other
circumstances where such risk may exist. The Bank's demand consists of a claim for return of the capital made
available to the borrower under the contract. By 31 December 2025 Bank Millennium filed 18,191 lawsuits against
the borrowers.
On 25 April 2024, a session of the Civil Chamber of the Supreme Court was held to answer questions formulated by
the First President of the Supreme Court, published on 29 January 2021, on key issues related to foreign currency
mortgage loan agreements. The Supreme Court, composed of the entire Civil Chamber, adopted a resolution
having the force of a legal principle, in which it stated that:
a. When finding that a provision of an indexed or denominated credit agreement relating to the manner of
determining the foreign currency exchange rate constitutes an unfair contractual provision and is not binding,
then in currently existing legal situation it cannot be stated that such a provision could be replaced by another
formula of defining the foreign currency exchange rate resulting from law or custom.
b. In case of impossibility to determine the foreign currency exchange rate binding the parties in the indexed or
denominated loan agreement, the agreement is not binding also in the remaining scope.
c. If, in the performance of a credit agreement which is not binding due to the unfair nature of its provisions, the
bank has disbursed to the borrower all or part of the amount of the credit and the borrower has made
repayments of the credit, independent claims for repayment of the undue performance shall arise in favour of
each party.
d. If a credit agreement is not binding due to the unfair nature of its provisions, the statute of limitations of the
bank's claim for repayment of amounts disbursed under the credit shall, as a rule, start to run from the day
following the day on which the borrower challenges being bound by the provisions of agreement.
e. If a credit agreement is not binding due to the unfair nature of its provisions, there shall be no legal basis for
any party to claim interest or other remuneration because of using party's pecuniary means during the period
from the provision of undue benefit until the delay in the return of this benefit.
On 19 June 2024, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 31/23)
stating that:
The right of retention (Article 496 of the Civil Code) does not apply to the party that can set off its claim against the
claim of the other party.
On 28 February 2025, the Supreme Court issued a resolution of 7 judges of the Supreme Court (III CZP 126/22), in
which it stated that:
(i) A bank loan agreement (Article 69(1) of the Banking Law Act of 29 August 1997) is a mutual agreement within
the meaning of Article 487 \u00a7 2 of the Civil Code.
On 5 March 2025 the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 37/24), in
which it stated that:
(i) In the event of a claim for repayment from a bank of a consideration fulfilled on the basis of a credit agreement
which has proved to be invalid, the bank is not entitled to the right of retention under Article 496 in connection
with Article 497 of the Civil Code.
On 15 May 2025, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 22/24), in
which it indicated that:
(i) Under the legal state in force until 30 June 2022, a request for a settlement attempt interrupted the limitation
period of the claim, unless the circumstances of making this action indicate that it was not undertaken directly for
the purpose of pursuing or determining, or satisfying or securing the claim (Article 123 \u00a7 1 point 1 of the Civil Code).
Due to the CJEU jurisprudence interpreting the causes and effects of invalidity of foreign currency mortgage loan
agreements as well as above indicated resolution of the Civil Chamber of the Supreme Court, the area of
interpretation of regulations by Polish courts in this respect appears to be limited. However, further jurisprudential
practice of the Polish courts will play certain role in practical realisation of the CJEU's and the Supreme Court\u2019s
guidance.
", "dimensions": { "concept": "ifrs-full:DisclosureOfProvisionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-707": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Interests and other amounts payable
158,792
140,793
Operations to be settled - foreign, transfers and deposits
129,370
240,727
Credit insurance received and to accrued
5,933
26,675
Holidays, subsidies and other remuneration payable
58,634
59,576
Transactions on securities to be settled
1,519
2,757
Public sector
46,118
53,902
Creditors
Rents to pay
190,336
209,110
Deposit account and other applications
99,704
124,872
Suppliers
56,182
80,933
From factoring operations
26,578
21,882
For futures and options transactions
18,074
13,533
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
6,619
8,780
Associates
178
14
\u00a0 Other creditors
\u00a0 \u00a0 Residents
39,337
45,016
\u00a0 \u00a0 Non-residents
67,677
47,253
Deferred income
12,964
12,065
Other administrative costs payable
5,605
3,447
Liabilities due to legally invalidated foreign currency mortgage loans
73,136
57,075
Insurance settlements
16,747
3,821
Commitment to pay \u2013 BGF (Bank associated with the Polish Bank Guarantee Fund)
64,472
53,174
Other liabilities
197,030
230,340
1,275,005
1,435,745
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the
amount of EUR 2,748,000 ( 31\u00a0December 2024: EUR 4,559,000) related to the actual value of benefits attributed
associated with mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity corresponds to transactions pending financial settlement, which
had already taken place on the date these accounts were approved.
The Group has several operating leases for properties, being recorded in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by
maturity, is as follows:
(Thousands of euros)
2025
2024
Until 1 year
21,766
21,994
1 to 5 years
81,942
87,401
Over 5 years
108,917
128,796
212,625
238,191
Accrued costs recognised in Net interest income
(22,289)
(29,081)
190,336
209,110
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-706": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Interests and other amounts payable
158,792
140,793
Operations to be settled - foreign, transfers and deposits
129,370
240,727
Credit insurance received and to accrued
5,933
26,675
Holidays, subsidies and other remuneration payable
58,634
59,576
Transactions on securities to be settled
1,519
2,757
Public sector
46,118
53,902
Creditors
Rents to pay
190,336
209,110
Deposit account and other applications
99,704
124,872
Suppliers
56,182
80,933
From factoring operations
26,578
21,882
For futures and options transactions
18,074
13,533
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
6,619
8,780
Associates
178
14
\u00a0 Other creditors
\u00a0 \u00a0 Residents
39,337
45,016
\u00a0 \u00a0 Non-residents
67,677
47,253
Deferred income
12,964
12,065
Other administrative costs payable
5,605
3,447
Liabilities due to legally invalidated foreign currency mortgage loans
73,136
57,075
Insurance settlements
16,747
3,821
Commitment to pay \u2013 BGF (Bank associated with the Polish Bank Guarantee Fund)
64,472
53,174
Other liabilities
197,030
230,340
1,275,005
1,435,745
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the
amount of EUR 2,748,000 ( 31\u00a0December 2024: EUR 4,559,000) related to the actual value of benefits attributed
associated with mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity corresponds to transactions pending financial settlement, which
had already taken place on the date these accounts were approved.
The Group has several operating leases for properties, being recorded in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by
maturity, is as follows:
(Thousands of euros)
2025
2024
Until 1 year
21,766
21,994
1 to 5 years
81,942
87,401
Over 5 years
108,917
128,796
212,625
238,191
Accrued costs recognised in Net interest income
(22,289)
(29,081)
190,336
209,110
", "dimensions": { "concept": "ifrs-full:DisclosureOfAccruedExpensesAndOtherLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-705": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Interests and other amounts payable
158,792
140,793
Operations to be settled - foreign, transfers and deposits
129,370
240,727
Credit insurance received and to accrued
5,933
26,675
Holidays, subsidies and other remuneration payable
58,634
59,576
Transactions on securities to be settled
1,519
2,757
Public sector
46,118
53,902
Creditors
Rents to pay
190,336
209,110
Deposit account and other applications
99,704
124,872
Suppliers
56,182
80,933
From factoring operations
26,578
21,882
For futures and options transactions
18,074
13,533
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
6,619
8,780
Associates
178
14
\u00a0 Other creditors
\u00a0 \u00a0 Residents
39,337
45,016
\u00a0 \u00a0 Non-residents
67,677
47,253
Deferred income
12,964
12,065
Other administrative costs payable
5,605
3,447
Liabilities due to legally invalidated foreign currency mortgage loans
73,136
57,075
Insurance settlements
16,747
3,821
Commitment to pay \u2013 BGF (Bank associated with the Polish Bank Guarantee Fund)
64,472
53,174
Other liabilities
197,030
230,340
1,275,005
1,435,745
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the
amount of EUR 2,748,000 ( 31\u00a0December 2024: EUR 4,559,000) related to the actual value of benefits attributed
associated with mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity corresponds to transactions pending financial settlement, which
had already taken place on the date these accounts were approved.
The Group has several operating leases for properties, being recorded in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by
maturity, is as follows:
(Thousands of euros)
2025
2024
Until 1 year
21,766
21,994
1 to 5 years
81,942
87,401
Over 5 years
108,917
128,796
212,625
238,191
Accrued costs recognised in Net interest income
(22,289)
(29,081)
190,336
209,110
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherPayablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-704": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Interests and other amounts payable
158,792
140,793
Operations to be settled - foreign, transfers and deposits
129,370
240,727
Credit insurance received and to accrued
5,933
26,675
Holidays, subsidies and other remuneration payable
58,634
59,576
Transactions on securities to be settled
1,519
2,757
Public sector
46,118
53,902
Creditors
Rents to pay
190,336
209,110
Deposit account and other applications
99,704
124,872
Suppliers
56,182
80,933
From factoring operations
26,578
21,882
For futures and options transactions
18,074
13,533
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
6,619
8,780
Associates
178
14
\u00a0 Other creditors
\u00a0 \u00a0 Residents
39,337
45,016
\u00a0 \u00a0 Non-residents
67,677
47,253
Deferred income
12,964
12,065
Other administrative costs payable
5,605
3,447
Liabilities due to legally invalidated foreign currency mortgage loans
73,136
57,075
Insurance settlements
16,747
3,821
Commitment to pay \u2013 BGF (Bank associated with the Polish Bank Guarantee Fund)
64,472
53,174
Other liabilities
197,030
230,340
1,275,005
1,435,745
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the
amount of EUR 2,748,000 ( 31\u00a0December 2024: EUR 4,559,000) related to the actual value of benefits attributed
associated with mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity corresponds to transactions pending financial settlement, which
had already taken place on the date these accounts were approved.
The Group has several operating leases for properties, being recorded in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by
maturity, is as follows:
(Thousands of euros)
2025
2024
Until 1 year
21,766
21,994
1 to 5 years
81,942
87,401
Over 5 years
108,917
128,796
212,625
238,191
Accrued costs recognised in Net interest income
(22,289)
(29,081)
190,336
209,110
", "dimensions": { "concept": "ifrs-full:DisclosureOfDeferredIncomeExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-708": { "value": "
The Group has several operating leases for properties, being recorded in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by
maturity, is as follows:
(Thousands of euros)
2025
2024
Until 1 year
21,766
21,994
1 to 5 years
81,942
87,401
Over 5 years
108,917
128,796
212,625
238,191
Accrued costs recognised in Net interest income
(22,289)
(29,081)
190,336
209,110
", "dimensions": { "concept": "ifrs-full:DisclosureOfLeasesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-710": { "value": "Share capital, Share premium and Other equity instruments
As at 31\u00a0December 2025 , the Bank's share capital amounts to EUR 3,000,000,000 and is represented by
14,804,627,089 nominative book-entry shares without nominal value, fully subscribed and paid up (total number of
voting rights inherent to these shares being also 14,804,627,089).
In the context of the share buyback programme in the total amount of up to EUR 200,000,000, the conclusion of
which was announced on 25 August 2025 (the \"Programme\"), the Bank, following the resolutions adopted\u00a0 in the
context of Items Eight and Nine of the Agenda of the General Meeting of 22 May 2025, concluded the following
operations on 23 December 2025:
-\u00a0 Share capital decrease by EUR 61,405,928.67, for the specific purpose of implementing the Buyback Programme,
with the share capital of the Bank now standing at EUR 2,938,594,071.33, involving the cancellation of 309,362,863
nominative book-entry treasury shares without nominal value, as well as the creation of a special reserve, subject
to the legal reserve regime, in the amount of EUR 61,405,928.67; and
-\u00a0 \u00a0 Subsequent share capital increase in the amount of EUR 61,405,928.67 to EUR 3,000,000,000, without issuing
new shares and by incorporating a special reserve of the same amount set up for this purpose following the
aforementioned share capital reduction, with the objective of restoring the share capital amount.
As at 31\u00a0December 2025, Share premium amounts to EUR 16,470,667.11, corresponding to the difference between
the issue price (EUR 0.0834 per share) and the issue value (EUR 0.08 per share) determined under the scope of the
Public Exchange Offer occurred in June 2015.
As at 31\u00a0December 2025, Other equity instruments in the amount of EUR 400,000,000 corresponds to 2,000
perpetual subordinated notes issued on 18 January 2024, with a nominal value of EUR 200,000 each which was
classified as Additional Tier 1 (AT1) in accordance with the specific rules of IAS 32 and accounting policy 1 E. The
issue has the option of early repayment by the Bank from the end of 5th year onwards with a coupon of 8.125% per
year for the first 5.5 years, which will be refixed from that date every 5 years, with reference to the then prevailing
5-year mid-swap rate plus a spread of 5.78% a year. As the operation is classified as AT1, the corresponding interest
payment can be cancelled by the Bank at its discretion or by imposition of the competent authorities and is still
subject to compliance with a set of conditions, including compliance with the combined capital reserve
requirement and the existence of sufficient distributable funds.
The Bank also decided, in accordance with its terms and conditions, to exercise the option of early repayment of
the entire AT1 issue issued on 31 January 2019 in the amount of EUR 400,000,000. The early repayment took place
on their first call date, 31 January 2024, at the nominal value plus the respective accrued interests.
As at 31\u00a0December 2025, the shareholders who hold, individually or jointly, 5% or more of the Bank's capital, are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Chiado (Luxembourg) S.\u00e0.r.l. (Fosun Group)
3,027,936,381
20.45%
20.45%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP
2,946,353,914
19.90%
19.90%
Total Qualified Shareholdings
5,974,290,295
40.35%
40.35%
", "dimensions": { "concept": "ifrs-full:DisclosureOfIssuedCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-709": { "value": "Share capital, Share premium and Other equity instruments
As at 31\u00a0December 2025 , the Bank's share capital amounts to EUR 3,000,000,000 and is represented by
14,804,627,089 nominative book-entry shares without nominal value, fully subscribed and paid up (total number of
voting rights inherent to these shares being also 14,804,627,089).
In the context of the share buyback programme in the total amount of up to EUR 200,000,000, the conclusion of
which was announced on 25 August 2025 (the \"Programme\"), the Bank, following the resolutions adopted\u00a0 in the
context of Items Eight and Nine of the Agenda of the General Meeting of 22 May 2025, concluded the following
operations on 23 December 2025:
-\u00a0 Share capital decrease by EUR 61,405,928.67, for the specific purpose of implementing the Buyback Programme,
with the share capital of the Bank now standing at EUR 2,938,594,071.33, involving the cancellation of 309,362,863
nominative book-entry treasury shares without nominal value, as well as the creation of a special reserve, subject
to the legal reserve regime, in the amount of EUR 61,405,928.67; and
-\u00a0 \u00a0 Subsequent share capital increase in the amount of EUR 61,405,928.67 to EUR 3,000,000,000, without issuing
new shares and by incorporating a special reserve of the same amount set up for this purpose following the
aforementioned share capital reduction, with the objective of restoring the share capital amount.
As at 31\u00a0December 2025, Share premium amounts to EUR 16,470,667.11, corresponding to the difference between
the issue price (EUR 0.0834 per share) and the issue value (EUR 0.08 per share) determined under the scope of the
Public Exchange Offer occurred in June 2015.
As at 31\u00a0December 2025, Other equity instruments in the amount of EUR 400,000,000 corresponds to 2,000
perpetual subordinated notes issued on 18 January 2024, with a nominal value of EUR 200,000 each which was
classified as Additional Tier 1 (AT1) in accordance with the specific rules of IAS 32 and accounting policy 1 E. The
issue has the option of early repayment by the Bank from the end of 5th year onwards with a coupon of 8.125% per
year for the first 5.5 years, which will be refixed from that date every 5 years, with reference to the then prevailing
5-year mid-swap rate plus a spread of 5.78% a year. As the operation is classified as AT1, the corresponding interest
payment can be cancelled by the Bank at its discretion or by imposition of the competent authorities and is still
subject to compliance with a set of conditions, including compliance with the combined capital reserve
requirement and the existence of sufficient distributable funds.
The Bank also decided, in accordance with its terms and conditions, to exercise the option of early repayment of
the entire AT1 issue issued on 31 January 2019 in the amount of EUR 400,000,000. The early repayment took place
on their first call date, 31 January 2024, at the nominal value plus the respective accrued interests.
As at 31\u00a0December 2025, the shareholders who hold, individually or jointly, 5% or more of the Bank's capital, are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Chiado (Luxembourg) S.\u00e0.r.l. (Fosun Group)
3,027,936,381
20.45%
20.45%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP
2,946,353,914
19.90%
19.90%
Total Qualified Shareholdings
5,974,290,295
40.35%
40.35%
Legal and statutory reserves
Under the Portuguese legislation, the Bank is required to annually set-up a legal reserve equal to a minimum of
10% of annual profits until the reserve equals the share capital, or until the sum of the free reserves constituted
and the retained earnings, if higher. In accordance with the proposal for the appropriation of net income for the
2024 financial year approved at the General Shareholders' Meeting held on 22 May 2025, the Bank increased its
legal reserves in the amount of EUR 80,257,000, thus, as at 31\u00a0December 2025 the Legal Reserves amount to EUR
464,659,000 (31\u00a0December 2024: EUR 384,402,000).
In accordance with the current Portuguese legislation, the Group companies must set-up annually a reserve with
a minimum percentage between 5% and 20% of their net annual profits depending on the nature of their
economic activity and are recognised in Other reserves and retained earnings in the Bank's consolidated financial
statements (note 44).
Reserves and retained earnings
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Changes in fair value - Gross amount
Financial assets at fair value through other comprehensive income (note 24)
\u00a0 \u00a0 Debt instruments (*)
81,639
409
\u00a0 \u00a0 Equity instruments
(52)
(1,051)
Of associates and other changes
20,928
5,556
Cash-flow hedge
(492,320)
(876,708)
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
(39)
(660)
(389,844)
(872,454)
Changes in Fair value - Tax
Financial assets at fair value through other comprehensive income
\u00a0 Debt instruments
(20,533)
440
\u00a0 Equity instruments
318
655
Cash-flow hedge
137,856
265,315
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
11
200
117,652
266,610
(272,192)
(605,844)
Exchange rate differences arising on consolidation
\u00a0 Bank Millennium, S.A.
(9,789)
(21,946)
\u00a0 BIM - Banco Internacional de Mo\u00e7ambique, S.A.
(171,222)
(128,243)
\u00a0 Banco Millennium Atl\u00e2ntico, S.A.
(188,730)
(181,875)
\u00a0 Other
(862)
1,591
(370,603)
(330,473)
Application of IAS 29
\u00a0 Effect on equity of Banco Millennium Atl\u00e2ntico, S.A.
52,382
50,964
\u00a0 Other
(3,965)
(3,965)
48,417
46,999
Other reserves and retained earnings
3,507,841
3,276,910
2,913,463
2,387,592
(*) Includes the effects arising from the application of hedge accounting.
As at 31 December 2025 the Other reserves and retained earnings item includes the effect of Bank Millennium
S.A.'s introduction of a change in the approach to calculating the effective interest rate (EIR) applied to the
valuation of mortgage loans with periodically fixed interest rates.
With the purpose to ensure a better economic substance of the transactions and to enhance consistency between
the accounting approach and the interest rate risk management framework, as well as the methodologies applied
within the BCP Group, in 2025, Bank Millennium S.A. changed its approach to determine the EIR. After this
change, the EIR was calculated exclusively on the basis of the currently applicable interest rate.
The item changes in fair value corresponds to the accumulated changes of the Financial assets at fair value
through other comprehensive income and Cash flow hedge, in accordance with the accounting policy presented
in note 1 C.
The variation in the fair value of cash flow hedges reflects the economic impact on these hedges of the
pronounced increase in market interest rates, an effect that is more than offset by the economic impact on the
fair value of liabilities that are more sensitive to such an increase and that are accounted for at amortised cost.
In compliance with the provisions of Article 324(1)(b) of the Portuguese Commercial Companies Code, the Bank
had a reserve in an amount equivalent to its own shares (note 43) of EUR 200,000,000 recognised under Other
Reserves and Retained Earnings. Following the resolutions adopted under Items Eight and Nine of the Agenda of
the General Meeting held on 22 May 2025, the Bank concluded at 23 December 2025 the Share capital decrease
(note 41), involving the cancellation of 309,362,863 nominative book-entry treasury shares without nominal value,
using the reserve described above.
During 2025, the changes occurred in changes in fair value - Gross amount, excluding the effect of hedge
accounting and changes in own credit risk associated with financial liabilities designated at fair value through
profit or loss, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1
January
Changes
in fair
value
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as
at 31
December
Financial assets at fair value through
other comprehensive income (note 24)
Debt instruments
Debt securities - Portuguese public
issuers
(12,007)
(297)
11,431
1,224
1,875
2,226
Other
12,416
80,433
(8,962)
4,877
(9,351)
79,413
409
80,136
2,469
6,101
(7,476)
81,639
Equity instruments
(1,051)
1,284
\u2014
\u2014
(285)
(52)
Associates and other changes
Millenniumbcp Ageas
(3,044)
16,009
\u2014
\u2014
(3,419)
9,546
Other associates and other changes
8,600
2,782
\u2014
\u2014
\u2014
11,382
5,556
18,791
\u2014
\u2014
(3,419)
20,928
4,914
100,211
2,469
6,101
(11,180)
102,515
During 2024 the changes occurred in Changes in fair value - Gross amount, excluding the effect of hedge
accounting and changes in own credit risk associated with financial liabilities designated at fair value through
profit or loss, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1
January
Changes
in fair
value
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as
at 31
December
Financial assets at fair value through
other comprehensive income (note 24)
Debt instruments
Debt securities - Portuguese public
issuers
(42,645)
53,336
(36,266)
(790)
14,358
(12,007)
Other
(32,681)
77,199
(40,597)
11,003
(2,508)
12,416
(75,326)
130,535
(76,863)
10,213
11,850
409
Equity instruments
(3,747)
1,243
\u2014
\u2014
1,453
(1,051)
Associates and other changes
Millenniumbcp Ageas
(10,267)
13,106
\u2014
\u2014
(5,883)
(3,044)
Other associates and other changes
8,539
61
\u2014
\u2014
\u2014
8,600
(1,728)
13,167
\u2014
\u2014
(5,883)
5,556
(80,801)
144,945
(76,863)
10,213
7,420
4,914
The item Disposals refers to the derecognition of debt securities and equity instruments at fair value through
other comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfShareCapitalReservesAndOtherEquityInterestExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-711": { "value": "Legal and statutory reserves
Under the Portuguese legislation, the Bank is required to annually set-up a legal reserve equal to a minimum of
10% of annual profits until the reserve equals the share capital, or until the sum of the free reserves constituted
and the retained earnings, if higher. In accordance with the proposal for the appropriation of net income for the
2024 financial year approved at the General Shareholders' Meeting held on 22 May 2025, the Bank increased its
legal reserves in the amount of EUR 80,257,000, thus, as at 31\u00a0December 2025 the Legal Reserves amount to EUR
464,659,000 (31\u00a0December 2024: EUR 384,402,000).
In accordance with the current Portuguese legislation, the Group companies must set-up annually a reserve with
a minimum percentage between 5% and 20% of their net annual profits depending on the nature of their
economic activity and are recognised in Other reserves and retained earnings in the Bank's consolidated financial
statements (note 44).
Reserves and retained earnings
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Changes in fair value - Gross amount
Financial assets at fair value through other comprehensive income (note 24)
\u00a0 \u00a0 Debt instruments (*)
81,639
409
\u00a0 \u00a0 Equity instruments
(52)
(1,051)
Of associates and other changes
20,928
5,556
Cash-flow hedge
(492,320)
(876,708)
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
(39)
(660)
(389,844)
(872,454)
Changes in Fair value - Tax
Financial assets at fair value through other comprehensive income
\u00a0 Debt instruments
(20,533)
440
\u00a0 Equity instruments
318
655
Cash-flow hedge
137,856
265,315
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
11
200
117,652
266,610
(272,192)
(605,844)
Exchange rate differences arising on consolidation
\u00a0 Bank Millennium, S.A.
(9,789)
(21,946)
\u00a0 BIM - Banco Internacional de Mo\u00e7ambique, S.A.
(171,222)
(128,243)
\u00a0 Banco Millennium Atl\u00e2ntico, S.A.
(188,730)
(181,875)
\u00a0 Other
(862)
1,591
(370,603)
(330,473)
Application of IAS 29
\u00a0 Effect on equity of Banco Millennium Atl\u00e2ntico, S.A.
52,382
50,964
\u00a0 Other
(3,965)
(3,965)
48,417
46,999
Other reserves and retained earnings
3,507,841
3,276,910
2,913,463
2,387,592
(*) Includes the effects arising from the application of hedge accounting.
As at 31 December 2025 the Other reserves and retained earnings item includes the effect of Bank Millennium
S.A.'s introduction of a change in the approach to calculating the effective interest rate (EIR) applied to the
valuation of mortgage loans with periodically fixed interest rates.
With the purpose to ensure a better economic substance of the transactions and to enhance consistency between
the accounting approach and the interest rate risk management framework, as well as the methodologies applied
within the BCP Group, in 2025, Bank Millennium S.A. changed its approach to determine the EIR. After this
change, the EIR was calculated exclusively on the basis of the currently applicable interest rate.
The item changes in fair value corresponds to the accumulated changes of the Financial assets at fair value
through other comprehensive income and Cash flow hedge, in accordance with the accounting policy presented
in note 1 C.
The variation in the fair value of cash flow hedges reflects the economic impact on these hedges of the
pronounced increase in market interest rates, an effect that is more than offset by the economic impact on the
fair value of liabilities that are more sensitive to such an increase and that are accounted for at amortised cost.
In compliance with the provisions of Article 324(1)(b) of the Portuguese Commercial Companies Code, the Bank
had a reserve in an amount equivalent to its own shares (note 43) of EUR 200,000,000 recognised under Other
Reserves and Retained Earnings. Following the resolutions adopted under Items Eight and Nine of the Agenda of
the General Meeting held on 22 May 2025, the Bank concluded at 23 December 2025 the Share capital decrease
(note 41), involving the cancellation of 309,362,863 nominative book-entry treasury shares without nominal value,
using the reserve described above.
During 2025, the changes occurred in changes in fair value - Gross amount, excluding the effect of hedge
accounting and changes in own credit risk associated with financial liabilities designated at fair value through
profit or loss, are analysed as follows:
(Thousands of euros)
2025
Balance as
at 1
January
Changes
in fair
value
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as
at 31
December
Financial assets at fair value through
other comprehensive income (note 24)
Debt instruments
Debt securities - Portuguese public
issuers
(12,007)
(297)
11,431
1,224
1,875
2,226
Other
12,416
80,433
(8,962)
4,877
(9,351)
79,413
409
80,136
2,469
6,101
(7,476)
81,639
Equity instruments
(1,051)
1,284
\u2014
\u2014
(285)
(52)
Associates and other changes
Millenniumbcp Ageas
(3,044)
16,009
\u2014
\u2014
(3,419)
9,546
Other associates and other changes
8,600
2,782
\u2014
\u2014
\u2014
11,382
5,556
18,791
\u2014
\u2014
(3,419)
20,928
4,914
100,211
2,469
6,101
(11,180)
102,515
During 2024 the changes occurred in Changes in fair value - Gross amount, excluding the effect of hedge
accounting and changes in own credit risk associated with financial liabilities designated at fair value through
profit or loss, are analysed as follows:
(Thousands of euros)
2024
Balance as
at 1
January
Changes
in fair
value
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as
at 31
December
Financial assets at fair value through
other comprehensive income (note 24)
Debt instruments
Debt securities - Portuguese public
issuers
(42,645)
53,336
(36,266)
(790)
14,358
(12,007)
Other
(32,681)
77,199
(40,597)
11,003
(2,508)
12,416
(75,326)
130,535
(76,863)
10,213
11,850
409
Equity instruments
(3,747)
1,243
\u2014
\u2014
1,453
(1,051)
Associates and other changes
Millenniumbcp Ageas
(10,267)
13,106
\u2014
\u2014
(5,883)
(3,044)
Other associates and other changes
8,539
61
\u2014
\u2014
\u2014
8,600
(1,728)
13,167
\u2014
\u2014
(5,883)
5,556
(80,801)
144,945
(76,863)
10,213
7,420
4,914
The item Disposals refers to the derecognition of debt securities and equity instruments at fair value through
other comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfReservesAndOtherEquityInterestExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-712": { "value": "Treasury shares
On 8 April 2025, the Bank approved a share buyback programme in the total amount of EUR 200,000,000,
equivalent to approximately 2,683% of BCP\u2019s market capitalisation (the \u201cBuyBack Programme\u201d).
The objective of the BuyBack Programme, for the purposes of Article 5(2)(a) of Regulation (EU) 596/2014, was the
cancellation of treasury shares acquired under its scope and it was implemented in accordance with the
provisions of Regulation (EU) 596/2014, as supplemented by Delegated Regulation (EU) 2016/1052, taking into
consideration the terms and conditions described below.
In this context, the Programme was approved in accordance with the following terms and conditions:
\u2013 Maximum number of shares to be acquired under the Buy-Back Programme: up to 755,699,497 ordinary
shares of BCP, corresponding to up to 5% of the total shares representing its share capital. This is the
maximum number of shares that may be cancelled in the context of the Buy-Back Programme, under
the terms of a resolution approved at the General Meeting.
\u2013 Maximum pecuniary amount of the Buy-Back Programme: up to EUR 200,000,000;
\u2013 Duration of the Buy-Back Programme: the Buy-Back Programme began on 14 April 2025 and ended on 14
October 2025 (inclusive), without prejudice, namely, of the possibility of ending earlier following a decision
by the Bank or should the maximum number of shares to be acquired or the maximum pecuniary
amount of the Buy-Back Programme were reached.
\u2013 Forms of acquisition under the Buy-Back Programme: acquisitions of shares or rights to acquire or
allocate shares, for consideration, in trading sessions on the Euronext Lisbon regulated market, in
compliance with the principle of shareholder equality as required by law, according to criteria whereby
any shareholder status is not considered a relevant factor.
On 25 August 2025, the Buy-back Program ended, with the Bank acquiring 309,362,863 BCP shares at a average
unit cost of 0.646 euros, for a total amount of EUR 200,000,000.
In compliance with the provisions of Article 324(1)(b) of the Commercial Companies Code, the Bank had a reserve
of a equivalent amount of its own shares, of EUR 200,000,000 recognised under the heading of Other Reserves
and Retained Earnings (note 44).
The Bank in the context of Items Eight and Nine of the Agenda of the General Meeting of 22 May 2025, concluded
on 23 December 2025 the Share capital decrease (note 41), involving the cancellation of 309,362,863 nominative
book-entry treasury shares without nominal value, using the reserve of Euros 200,000,000 described above.
The own shares held by the companies included in the consolidation scope are within the limits established by the
Bank's by-laws and by the Commercial Companies Code.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTreasurySharesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-713": { "value": "Non-controlling interests
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Changes in fair value
Debt instruments
27,247
(7,277)
Equity instruments
4,715
4,059
Cash-flow hedge
(317)
(2,889)
Other
1,083
4
32,728
(6,103)
Deferred taxes
Debt instruments
(6,311)
1,922
Equity instruments
(1,070)
(783)
Cash-flow hedge
95
549
(7,286)
1,688
25,442
(4,415)
Exchange rate differences arising on consolidation
(120,731)
(111,335)
Actuarial losses (net of taxes)
(2,465)
(156)
Other reserves and retained earnings
1,345,271
1,213,620
1,247,517
1,097,714
The balance Non-controlling interests is analysed as follows:
(Thousands of euros)
Balance Sheet
Income Statement
2025
2024
2025
2024
Bank Millennium Group
1,078,304
906,757
141,568
83,368
BIM - Banco Internacional de Mo\u00e7ambique Group
158,153
179,502
1,128
16,147
Other subsidiaries
11,060
11,455
(615)
(5,410)
1,247,517
1,097,714
142,081
94,105
The following table presents a summary of financial information for the main subsidiaries included in this balance,
prepared in accordance with IFRS. The information is presented before inter-company eliminations:
(Thousands of euros)
Bank Millennium Group
BIM - Banco International
de Mo\u00e7ambique Group
2025
2024
2025
2024
Net income for the year
283,704
167,071
3,386
48,469
Net income attributable to shareholders
142,136
83,703
2,258
32,322
Net income attributable to non-controlling interests
141,568
83,368
1,128
16,147
Other comprehensive income attributable to shareholders
40,741
31,463
(44,890)
27,085
Other comprehensive income attributable to non-controlling
interests
40,578
31,336
(22,426)
13,548
Total comprehensive income
365,023
229,870
(63,930)
89,102
Balance sheet
Financial assets
36,041,258
31,723,336
2,503,801
2,866,807
Non-financial assets
908,019
851,022
185,831
210,258
Financial liabilities
(33,327,715)
(29,494,494)
(2,148,273)
(2,450,663)
Non-financial liabilities
(1,460,528)
(1,262,661)
(67,745)
(88,858)
Equity:
2,161,034
1,817,203
473,614
537,544
attributable to shareholders
1,082,730
910,446
315,832
358,464
attributable to non-controlling interests
1,078,304
906,757
157,782
179,080
Cash flows arising from:
operating activities
3,226,769
2,497,437
6,074
139,827
investing activities
(3,248,321)
(3,229,668)
(22,936)
(22,366)
financing activities
194,596
417,754
(4,401)
(96,770)
Increase / (decrease) in cash and cash equivalents
173,044
(314,477)
(21,263)
20,691
Dividends paid during the year:
attributable to shareholders
\u2014
\u2014
\u2014
57,503
attributable to non-controlling interests
\u2014
\u2014
\u2014
28,727
\u2014
\u2014
\u2014
86,230
", "dimensions": { "concept": "ifrs-full:DisclosureOfNoncontrollingInterestsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-714": { "value": "Guarantees and other commitments
This balance is analysed as follows:
(Thousands of euros)
2025
2024
Guarantees granted
Guarantees
3,846,367
3,958,506
Stand-by letter of credit
90,437
90,380
Open documentary credits
231,257
219,509
Bails and indemnities
9,744
9,865
4,177,805
4,278,260
Commitments to third parties
Irrevocable commitments
Term deposit contracts
41
81
Irrevocable credit facilities
6,443,765
5,359,955
Securities subscription
8,721
14,949
Other irrevocable commitments
59,294
109,004
Revocable commitments
Revocable credit facilities
6,338,900
6,488,735
Bank overdraft facilities
1,078,993
1,022,545
Other revocable commitments
211,772
131,243
14,141,486
13,126,512
Guarantees received
27,708,089
27,329,443
Commitments from third parties
12,035,074
11,715,068
Securities and other items held for safekeeping
101,554,717
86,897,547
Securities and other items held under custody by the Securities Depository Authority
102,535,454
89,014,967
Other off-balance sheet accounts
168,508,261
144,802,013
The guarantees granted by the Group may be related to loans transactions, where the Group grants a guarantee
in connection with a loan granted to a customer by a third entity. According to its specific characteristics it is
expected that some of these guarantees expire without being executed and therefore these transactions do not
necessarily represent a cash-outflow. The estimated liabilities are recorded under provisions (note 39).
Stand-by letters and open documentary credits aim to ensure the payment to third parties from commercial deals
with foreign entities and therefore financing the shipment of the goods. Therefore, the credit risk of these
transactions is limited since they are collateralised by the shipped goods and are generally short-term operations.
Irrevocable commitments are non-used parts of credit facilities granted to corporate or retail customers. Many of
these transactions have a fixed term and a variable interest rate and therefore the credit and interest rate risk are
limited.
As at 31 December 2025 and 2024, the balance Irrevocable commitments - Other irrevocable commitments
includes the amount of EUR 30,638,000 relating to the collateral constituted in compliance with the assumption
of irrevocable payment commitments to Single Resolution Fund, as referred in note 32.
This balance also included, the amount of EUR 47,595,000, corresponding to irrevocable commitments for
cumulative payments undertaken with the Deposit Guarantee Fund. In the last quarter of 2025, the Group (BCP
and ActivoBank) paid the remainder in the amount of EUR 47,595,000, with the irrevocable commitment no
longer existing (note 6).
The financial instruments accounted as guarantees and other commitments are subject to the same approval and
control procedures applied to the credit portfolio, namely regarding the analysis of objective evidence of
impairment, as described in the accounting policy in note 1.C. The maximum credit exposure is represented by the
nominal value that could be lost related to guarantees and commitments undertaken by the Group in the event
of default by the respective counterparties, without considering potential recoveries or collaterals.
Guarantees granted, Irrevocable credit facilities and revocable commitments portfolio detailed by stage according
with IFRS 9, is analysed as follows:
(Thousands of euros)
2025
2024
Stage 1
Gross amount
16,256,295
15,758,607
Impairment
(30,425)
(13,831)
16,225,870
15,744,776
Stage 2
Gross amount
1,682,810
1,197,262
Impairment
(23,353)
(15,261)
1,659,457
1,182,001
Stage 3
Gross amount
312,130
324,869
Impairment
(92,378)
(88,947)
219,752
235,922
18,105,079
17,162,699
", "dimensions": { "concept": "ifrs-full:DisclosureOfCommitmentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-715": { "value": "Relevant events occurred during 2025Banco Comercial Portugu\u00eas, S.A. informed on the conclusion of the commercial registration of its share capital decrease and increaseOn 23 December 2025, Banco Comercial Portugu\u00eas, S.A. (\"BCP\") hereby informed that, following the resolutions adopted in the context of Items Eight and Nine of the Agenda of the General Meeting of 22 May 2025 and in the context of the share buyback programme in the total amount of up to EUR 200,000,000.00 (two hundred million euros), the conclusion of which was announced on 25 August 2025 (\"Buyback Programme\"), the commercial registration of the following operations was completed today:\u2013 Share capital decrease by EUR 61,405,928.67 (sixty-one million, four hundred and five thousand, nine hundred and twenty-eight euros and sixty-seven cents), for the special purpose of implementing the Buyback Programme, the share capital of the Bank now standing at EUR 2,938,594,071.33 (two thousand, nine hundred and thirty-eight million, five hundred and ninety-four thousand, seventy-one euros and thirty-three cents), involving the cancellation of 309,362,863 nominative book-entry treasury shares without nominal value, as well as the creation of a special reserve, subject to the legal reserve regime, in the amount of EUR 61,405,928.67; and\u2013 Subsequent share capital increase in the amount of EUR 61,405,928.67 to EUR 3,000,000,000.00, without issuing new shares and by incorporating a special reserve of the same amount set up for this purpose following the aforementioned share capital reduction, with the objective of restoring the share capital amount.The Bank's share capital is therefore EUR 3,000,000,000.00, represented by 14,804,627,089 registered shares without nominal value (total number of voting rights inherent to these shares being also 14,804,627,089).Banco Comercial Portugu\u00eas, S.A. informed about rating upgrades by Fitch RatingsOn 28 November 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) informed that Fitch Ratings upgraded BCP's long-term senior unsecured debt ratings from BBB to BBB+, following the upgrade of the long-term Issuer Default Rating (IDR) from BBB to BBB+ and the Viability Rating (VR) from bbb to bbb+, having maintained the Positive Outlook.The upgrade reflects BCP's consistent progress in portfolio derisking and business model stabilization, which are visible in structurally improved core profitability and internal capital generation. These changes are underpinned by impaired loans ratio reduction due to recoveries and limited new impaired loan formation, contained revenue pressure, and abating legal costs in Poland. Fitch Ratings within the scope of the review also took into consideration the revision of the Portuguese operating environment to 'a-' from 'bbb+', which should result in better growth opportunities for BCP due to its strong domestic franchise.The Positive Outlook reflects Fitch\u2019s view that BCP's business profile, internal capital generation and asset quality should structurally improve further if the bank successfully continues to execute on its strategic growth plan and resolves legacy risks related to Polish foreign-currency mortgage loans.Fitch Ratings also raised the rating of long-term deposits to A- from BBB+ and the rating of Additional Tier 1 and Tier 2 instruments by one notch, to BB and BBB-, respectively.Banco Comercial Portugu\u00eas, S.A. informed about the acceptance of the resignation and co-optation of a non-executive directorOn 27 November 2025, Banco Comercial Portugu\u00eas, S.A. (Bank) informed that its Board of Directors approved the co-optation of Tao Li (Vincent Li) as a non-executive member of the Bank's Board of Directors, following the submission of a letter of resignation from Lingjiang Xu from the same position, which was accepted with effect from 27 November 2025.The co-optation was decided upon obtaining authorisation from the European Central Bank to perform the duties and will be submitted for ratification at the Bank's next General Meeting.Banco Comercial Portugu\u00eas, S.A. informed about minimum prudential requirementsOn 3 November 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) informed that, under the context of the Supervisory Review and Evaluation Process (SREP), it has been notified of the decision of the European Central Bank (ECB) regarding minimum prudential requirements to be fulfilled on a consolidated basis from 1 January 2026. According to the information received, the Pillar 2 Requirement (\"P2R\") for BCP from 1 January 2026, is 2.15%, which represents a decrease of 10 bp, reflecting a more favourable assessment from the Supervisor on the Bank's global risk.The decisions referred above establish the minimum own funds requirements determined based on the total value of risk-weighted assets (RWA):Minimum Capital Requirements BCP Consolidated Capital requirementsof which: Pilar 1 Pilar 2 Buffers CET1 10.28%4.50%1.21%4.57%T1 12.18%6.00%1.61%4.57%Total 14.72%8.00%2.15%4.57%Buffers include the capital conservation buffer (2.5%), the buffer for other systemically important institutions (O-SII: 1.0%), Countercyclical Capital Buffer (CCyB: 0.80%; proforma in September 2025: weighted average of exposures by country by their respective countercyclical reserve, of which 0.75% for exposures in Portugal in accordance with Notice 7/2024 of the Banco de Portugal and 1% for exposures in Poland, recalculated quarterly) and the Sectoral Systemic Risk buffer of 0.27% (variable, corresponding to 4% on the amount of risk exposures on the retail portfolio of loans to individuals collateralised by residential properties located in Portugal, calculated in pursuant to paragraph 3 of article 92 of Regulation (EU) 575/2013, at the highest level of consolidation in Portugal, considering the applicable legal framework). The estimated ratios as at 30 September 2025, on a consolidated basis, exceed the minimum required CET1, Tier 1 and total ratio by a wide margin, including all the reserves mentioned above, demonstrating the Bank's solid capitalization.Banco Comercial Portugu\u00eas, S.A. informed on the upgrade of credit ratings by Morningstar DBRSOn 1 October 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) informed that Morningstar DBRS rating agency upgraded the Bank's deposits ratings from A(low) to A and the senior unsecured debt ratings from BBB(high) to A(low).The upgrade to BCP's credit ratings by Morningstar DBRS's reflects that the Bank's asset quality has demonstrated sustained improvement, while BCP\u2019s profitability, internal capital generation, and solvency buffers remain strong. According to Morningstar DBRS, the Bank has made ample progress in reducing nonperforming exposures (NPEs) in Portugal and in its international operations. Morningstar DBRS expects the favourable economic environment in Portugal to support the Bank\u2019s domestic operations and limit asset quality deterioration, and risk linked to legacy Swiss franc-denominated mortgages in Poland has diminished, partly because of large provisioning. The trend on all credit ratings is Stable.BCP S.A. informed about decision to call the currently outstanding EUR500,000,000 Senior Preferred Fixed to Floating Rate Notes due October 2026 with an outstanding amount of 500 million eurosOn 19 September, Banco Comercial Portugu\u00eas, S.A. informed that it has decided to exercise its option to early redeem all of its EUR500,000,000 Senior Preferred Fixed to Floating Rate Notes due October 2026 (ISIN: PTBCP2OM0058), issued on 2 October 2023 under the EUR25,000,000,000 Euro Note Programme (the \u201cNotes\u201d), in accordance with condition 6(d) of the terms and conditions of the Notes and the final terms of the Notes. The early redemption of the Notes shall take place on the optional redemption date set out in the final terms of the Notes, 2 October 2025, at their outstanding principal amount together with accrued interest.Banco Comercial Portugu\u00eas, S.A. informed about Interim report on the transactions conducted under the Share BuyBack ProgrammeOn 25 August 2025, in the context of the BuyBack Programme, the Bank informed that has, up until that date, purchased 309,362,863 shares for a price amounting to a total of EUR 200,000,000, holding on that date an aggregate total 309,362,863 own shares, representing 2.05% of its share capital. These purchases are the last purchases to be made under the BuyBack Programme, thus the programme being deemed as completed in accordance with its terms, as duly disclosed to the market in due course.Banco Comercial Portugu\u00eas, S.A. informed about 2025 EU-Wide Stress Test ResultsOn 1 August 2025, Banco Comercial Portugu\u00eas, S.A. informed that it was subjected to the 2025 EU-wide stress test conducted by the European Banking Authority (EBA), in cooperation with the Banco de Portugal (BdP), the European Central Bank (ECB), and the European Systemic Risk Board (ESRB).Banco Comercial Portugu\u00eas, S.A. notes the announcements made today by the EBA on the EU-wide stress test and fully acknowledges the outcomes of this exercise, comprising 64 banks that together represent around 75% of total banking assets in the European Union.The 2025 EU-wide stress test does not contain a pass-fail threshold and instead is designed to be used as an important source of information for the purposes of the Supervisory Review and Evaluation Process (SREP). The results will assist competent authorities in assessing Banco Comercial Portugu\u00eas, S.A. ability to meet applicable prudential requirements under stressed scenarios.The adverse stress test scenario was set by the ECB/ESRB and covers a three-year time horizon (2025-2027). The stress test has been carried out applying a static balance sheet assumption as of December 2024, and therefore does not take into account future business strategies and management actions. It is not a forecast of Banco Comercial Portugu\u00eas, S.A. financial evolution. Considering the results of Banco Comercial Portugu\u00eas, S.A, in the stress test, it should be highlighted the following:\u2022 the application of the adverse scenario resulted in a reduction of 228 b.p. at the end of 2025, 152 b.p. at the end of 2026 and of 100 b.p. at the end of 2027 compared to the CET1 fully loaded restated (CRR3) capital ratio of 2024, which compares with an average reduction in the universe of the 64 banks submitted to this exercise, of 260 b.p. at the end of 2025, 275 b.p. at the end of 2026 and 304 b.p. at the end of 2027.\u2022 the application of the baseline scenario resulted in an increase of 129 b.p in the fully loaded CET1 capital ratio at the end of 2025, 254 b.p. at the end of 2026 and of 279 b.p. at the end of 2027 compared to the CET1 fully loaded restated (CRR3) capital ratio of 2024, which compares with an average increase in the universe of the 64 banks submitted to this exercise, of 65 b.p at the end of 2025, 113 b.p. at the end of 2026 and 128 b.p. at the end of 2027.Banco Comercial Portugu\u00eas, S.A. informed on notification by Banco de Portugal regarding MREL requirements On 11 July 2025, Banco Comercial Portugu\u00eas, S.A. (\"BCP\" or the \"Bank\") informed that it has been notified by Banco de Portugal, as the national resolution authority, about the update of its minimum requirement for own funds and eligible liabilities (\"MREL\" or \"Minimum Requirement for own funds and Eligible Liabilities\") as decided by the Single Resolution Board.The resolution strategy applied continues to be that of a multiple point of entry (\"MPE\"). The MREL requirements to be met by BCP Group of Resolution (consisting of BCP, S.A., Banco ActivoBank, S.A. and all the subsidiary companies of BCP apart from Bank Millennium S.A. and Banco Internacional de Mo\u00e7ambique and their respective subsidiaries), with immediate application, is of:\u2022 24.89% of the total risk exposure amount (\"TREA\") to which adds further a combined buffer requirement (\"CBR\"), which also includes the \u201cCountercyclical Capital Buffer\u201d \u2014 CCyB and the \u201cSystemic Risk Buffer\u201d \u2014 SyRB, currently of 3.95%, thus corresponding to total requirements currently of 28.84%; and\u2022 6.86% of the leverage ratio exposure measure (\"LRE\"). Additionally, the Bank informed that is not subject to any subordination requirements.In accordance with the regulations in force, MREL requirements could be annually updated by the competent authorities, and therefore these targets replace those previously set. At the date of this announcement, BCP informed that it complies with the established MREL requirements, both as a percentage of the TREA (including the CBR) and as a percentage of the LRE.Banco Comercial Portugu\u00eas, S.A. informed about issue of senior preferred debt securities eligible for MRELOn 16 June 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBank\u201d) hereby informed that it has set the terms for a new issue of senior preferred debt securities eligible for MREL (Minimum Requirement for own funds and Eligible Liabilities), under its Euro Note Programme.The issue, in the amount of EUR 500 million, will have a tenor of 6 years, with the option of early redemption by the Bank at the end of year 5, an issue price of 99.631% and an annual interest rate of 3.125% during the first 5 years (corresponding to a spread of 0.95% over the 5-year mid-swap rate). The interest rate for the year 6 was set at 3-month Euribor plus a 0.95% spread.Bank Millennium Minimum requirements for own funds and eligible liabilities (MREL)Bank Millennium manages MREL indicators in a manner analogous to capital adequacy management.In terms of the MREL-TREA and MREL-TEM requirements, Bank Millennium Group has a surplus compared to the minimum required levels as at 31 December 2025, and also meets the MREL-TREA Requirement after the inclusion of the Combined Buffer Requirement.MREL 31.12.202531.12.2024 MREL-TREA ratio 24.53%28.06%Minimum required level MREL-TREA 15.36%18.03%Surplus(+) / Deficit(-) of MREL-TREA (p.p.) 9.17 p.p. 10.03 p.p. Minimum required level including Combined Buffer Requirement (CBR) 19.11%20.78%Surplus(+) / Deficit(-) of MREL-TREA+CBR (p.p.) 5.42%7.28 p.p. MREL-TEM ratio 8.27%8.71%Minimum required level of MREL-TEM 5.91%5.91%Surplus(+) / Deficit(-) of MREL-TEM (p.p.) 2.36 p.p. 2.80 p.p. In May 2025, the Bank received a joint decision of the resolution authorities requiring it to meet the MREL requirements. The updated minimum requirements are 15.36% (consolidated MREL-TREA) and 5.91% (consolidated MREL-TEM). Additionally, in relation to the above decisions, the Bank should also meet the MREL requirement taking into account the Combined Buffer Requirement (currently 3.75%).Banco Comercial Portugu\u00eas, S.A. informed about resolutions of the Annual General MeetingBanco Comercial Portugu\u00eas, S.A. concluded on 22 May 2025, at the Bank's facilities and, simultaneously, through electronic means with 66.19% of the share capital represented, the Annual General Meeting of Shareholders, with the following resolutions:Item One \u2013 Approval of the management report, the balance sheet and the individual and consolidated accounts for the financial year 2024, the Corporate Governance Report, which includes a chapter on the remuneration of the management and supervisory bodies, and the Sustainability Report; Item Two \u2013 Approval of the proposal for the appropriation of net income regarding the 2024 financial year;Item Three \u2013 Approval of a vote of trust and praise addressed to the Board of Directors, including to the Executive Committee and to the Audit Committee and each one of their members, as well as to the Chartered Accountant and its representative;Item Four \u2013 Ratification of the co-option of a director for the 2022-2025 term of office;Item Five \u2013 Approval of the Shareholder Distribution Policy;Item Six \u2013 Approval of the updating the Remuneration Policy for Members of the Management and Supervisory Bodies;Item Seven \u2013 Approval of the updating the Internal Policy for the Selection and Assessment of the suitability of members of the management and supervisory bodies and key function holders;Item Eight \u2013 Approval of the reduction of the Bank's share capital by up to EUR 150,000,000.00 (one hundred and fifty million euros), with the special purpose of implementing a Buyback Programme and cancelling own shares already acquired or to be acquired under said programme, involving the cancellation of up to 755,699,497 own shares representing up to 5% of the total number of shares representing the share capital, as well as the related reserves, with the consequent amendment of article 4(1) of the articles of association;Item Nine \u2013 Approval of the increase of the Bank's share capital to EUR 3,000,000,000, by incorporating the special reserve that may be set up under item Eight of the Agenda, by the amount corresponding to the resulting share capital reduction and without issuing new shares, with the consequent amendment of Article 4(1) of the articles of association;Item Ten \u2013 Approval of the amendment to article 27(2) of the Articles of Association (postal and electronic voting);Item Eleven \u2013 Approval of the acquisition and sale of own shares and bonds.Banco Comercial Portugu\u00eas, S.A. informed about ratings upgrade by Moody\u2019sOn 21 May 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) informed that Moody\u2019s has upgraded the Baseline Credit Assessment (BCA) and Adjusted BCA from \u2018baa3\u2019 to \u2018baa2\u2019. This upgrade reflects the group\u2019s strengthened creditworthiness, in particular its significantly improved asset-risk metrics, its higher capital levels and the group's enhanced bottom-line profitability, that will, nevertheless, continue to be strained over the outlook period by the relatively high, albeit decreasing, legal provisions associated to BCP's Polish subsidiary's legacy Swiss franc mortgage portfolio. BCP's BCA also reflects the bank's sound funding and liquidity position.As a result, Moody\u2019s upgraded the rating of the deposits from \u2018A3\u2019 to \u2018A2\u2019, the rating of the subordinated debt from \u2018Ba1\u2019 to 'Baa3', standing after the revision at an Investment Grade level and affirmed the rating of the senior unsecured debt at \u2018Baa1\u2019. The Outlook on the deposit rating was changed to stable, while the Outlook on senior unsecured debt is stable.Banco Comercial Portugu\u00eas, S.A. informed on the approval of a Share Buyback ProgrammeOn 8 April 2025, the Bank informed that a share buyback programme in the total amount of EUR 200 million, equivalent to approximately 2,683%[1] of BCP\u2019s market capitalisation[1] was approved today. The objective of the BuyBack Programme, for the purposes of Article 5(2)(a) of Regulation (EU) 596/2014, is the cancellation of treasury shares acquired under its scope and it will be implemented in accordance with the provisions of Regulation (EU) 596/2014, as supplemented by Delegated Regulation (EU) 2016/1052, taking into consideration the terms and conditions described, and also being conditional to: (i) the limits set out in the resolution adopted under item 6 of the Agenda of the General Meeting held on 22 May 2024, as duly disclosed to the market; (ii) the terms and conditions of any future authorisations for the acquisition of treasury shares that may be approved by the General Meeting of Shareholders of BCP; and (iii) the terms and conditions of any share capital reduction that may be resolved for these purposes by the General Meeting of Shareholders. On 14 April 2025, the Bank started trading own shares in the context of the Share BuyBack Programme approved by the Bank in accordance with the terms and conditions described in the announcement regarding the start of trading under the BuyBack Programme disclosed by BCP on 8 April 2025.Banco Comercial Portugu\u00eas, S.A. informed on the termination of rating assignment by Morningstar DBRS to BCP's Covered BondsBanco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d) hereby informed that, on 1 April 2025, and at its request, ceased the assignment of rating by Morningstar DBRS to the Covered Bonds issued by BCP.BCP\u2019s covered bonds maintain the ratings currently assigned by Moody\u2019s and Fitch Ratings, respectively, of \u2018Aaa\u2019 and \u2018AAA\u2019.Banco Comercial Portugu\u00eas, S.A. informed about the decision to launch a tender offer on a T2 Notes issue due December 2027On 13 March 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d) informed it has decided to launch a tender offer (the \u201cOffer\u201d) in respect to its outstanding EUR300,000,000 4.50% T2 Subordinated Fixed Rate Reset Notes due December 2027 (ISIN: PTBCPWOM0034) (the \u201cNotes\u201d).The Offer is conditional on the successful completion of the issuance of a new series of Subordinated Fixed Rate Reset Notes to be issued off the Banks\u2019 Euro Note Programme, subject to market conditions in amount of at least EUR 450,000,000 (the \u201cNew Notes\u201d).When considering allocation of the New Notes, BCP may give preference to those noteholders that, prior to such allocation, have validly tendered (or have given a firm intention to tender) their Notes for purchase pursuant to the Offer. The purpose of the Offer is to proactively manage BCP\u2019s capital structure and debt profile. The Offer also provides liquidity for investors in the Notes simultaneously with the opportunity to apply for priority allocation in the new Tier 2 issuance.Banco Comercial Portugu\u00eas, S.A. informed about issue of Tier 2 NotesOn 13 March 2025, Banco Comercial Portugu\u00eas, S.A. hereby informed, that on the same day, Bank has fixed the terms for a new issue of subordinated Tier 2 Notes under its Euro Note Programme.The issue, in the amount of EUR 500 million, will have a tenor of 12 years, with the option of early redemption by the Bank in the last three months of year 7, an annual interest rate of 4.75% during the first 7 years (corresponding to a spread of 2.150% (the \u201cSpread\u201d) over the 7-year mid-swap rate). The interest rate for the last 5 years will be determined on the basis of the then applicable 5-year mid-swap rate plus the Spread.[1] With reference to the closing price registered in the regulated market Euronext Lisbon on 8 April 2025.Banco Comercial Portugu\u00eas, S.A. informed about decision to early redeem in full the EUR 450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 bond issueOn 10 March 2025, Banco Comercial Portugu\u00eas, S.A. informed that it has decided to exercise its option to early redeem all of its EUR450,000,000 Subordinated Fixed Rate Reset Notes due 27 March 2030 (ISIN: PTBIT3OM0098), issued on 27 September 2019 under the EUR 25,000,000,000 Euro Note Programme (the \u201cNotes\u201d), in accordance with condition 6(d) of the terms and conditions of the Notes and the final terms of the Notes. The early redemption of the Notes shall take place on the optional redemption date set out in the final terms of the Notes, 27 March 2025, at their outstanding principal amount together with accrued interest.Downgrade of the rating attributed by S&P \u2013 Standard & Poor\u2019s to Mozambique\u2019s sovereign debtOn 19 February 2025, S&P further downgraded its long-term government debt rating by 1 notch from CCC to CCC-, due to liquidity challenges and apparent delays in payments to domestic creditors.On 21 March 2025, S&P downgraded the rating of Mozambique's long-term local currency sovereign debt again from CCC- to SD (Selective Default).On 10 October 2025, S&P maintained the aforementioned ratings. This assessment by S&P Global Ratings reinforces the need for close monitoring of the evolution of Mozambique's sovereign risk.Banco Comercial Portugu\u00eas, S.A. informed on the co-optation of non-executive independent DirectorOn 22 January 2025, Banco Comercial Portugu\u00eas, S.A. informed that its Board of Directors, in accordance with the law and the Bank's regulations on Succession Planning, today approved the co-optation of Esmeralda da Silva Santos Dourado as independent non-executive director of the Bank, thus filling the vacancy on the Board of Directors for the four-year period 2022-2025.The co-optation was resolved following obtaining authorisation from the European Central Bank to exercise her functions and will be submitted for ratification at the Bank's next General Meeting.", "dimensions": { "concept": "ifrs-full:DescriptionOfSignificantEventsAndTransactions", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-716": { "value": "
Banco Comercial Portugu\u00eas, S.A. informed about resolutions of the Annual General
Meeting
Banco Comercial Portugu\u00eas, S.A. concluded on 22 May 2025, at the Bank's facilities and, simultaneously, through
electronic means with 66.19% of the share capital represented, the Annual General Meeting of Shareholders, with
the following resolutions:
Item One \u2013 Approval of the management report, the balance sheet and the individual and consolidated accounts
for the financial year 2024, the Corporate Governance Report, which includes a chapter on the remuneration of
the management and supervisory bodies, and the Sustainability Report;
Item Two \u2013 Approval of the proposal for the appropriation of net income regarding the 2024 financial year;
Item Three \u2013 Approval of a vote of trust and praise addressed to the Board of Directors, including to the Executive
Committee and to the Audit Committee and each one of their members, as well as to the Chartered Accountant
and its representative;
Item Four \u2013 Ratification of the co-option of a director for the 2022-2025 term of office;
Item Five \u2013 Approval of the Shareholder Distribution Policy;
Item Six \u2013 Approval of the updating the Remuneration Policy for Members of the Management and Supervisory
Bodies;
Item Seven \u2013 Approval of the updating the Internal Policy for the Selection and Assessment of the suitability of
members of the management and supervisory bodies and key function holders;
Item Eight \u2013 Approval of the reduction of the Bank's share capital by up to EUR 150,000,000.00 (one hundred and
fifty million euros), with the special purpose of implementing a Buyback Programme and cancelling own shares
already acquired or to be acquired under said programme, involving the cancellation of up to 755,699,497 own
shares representing up to 5% of the total number of shares representing the share capital, as well as the related
reserves, with the consequent amendment of article 4(1) of the articles of association;
Item Nine \u2013 Approval of the increase of the Bank's share capital to EUR 3,000,000,000, by incorporating the special
reserve that may be set up under item Eight of the Agenda, by the amount corresponding to the resulting share
capital reduction and without issuing new shares, with the consequent amendment of Article 4(1) of the articles of
association;
Item Ten \u2013 Approval of the amendment to article 27(2) of the Articles of Association (postal and electronic voting);
Item Eleven \u2013 Approval of the acquisition and sale of own shares and bonds.
Banco Comercial Portugu\u00eas, S.A. informed about ratings upgrade by Moody\u2019s
On 21 May 2025, Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) informed that Moody\u2019s has upgraded the
Baseline Credit Assessment (BCA) and Adjusted BCA from \u2018baa3\u2019 to \u2018baa2\u2019. This upgrade reflects the group\u2019s
strengthened creditworthiness, in particular its significantly improved asset-risk metrics, its higher capital levels
and the group's enhanced bottom-line profitability, that will, nevertheless, continue to be strained over the
outlook period by the relatively high, albeit decreasing, legal provisions associated to BCP's Polish subsidiary's
legacy Swiss franc mortgage portfolio. BCP's BCA also reflects the bank's sound funding and liquidity position.
As a result, Moody\u2019s upgraded the rating of the deposits from \u2018A3\u2019 to \u2018A2\u2019, the rating of the subordinated debt from
\u2018Ba1\u2019 to 'Baa3', standing after the revision at an Investment Grade level and affirmed the rating of the senior
unsecured debt at \u2018Baa1\u2019.
The Outlook on the deposit rating was changed to stable, while the Outlook on senior unsecured debt is stable.
Solvency
The Group\u2019s own funds are determined according to the established regulation, namely, according to Directive
2013/36/EU and Regulation (EU) 575/2013, approved by the European Parliament and the Council.
Total capital includes tier 1 and tier 2. Tier 1 comprises common equity tier 1 (CET1) and additional tier 1.
Common equity tier 1 includes: (i) paid-up capital, share premium, reserves and retained earnings deducted of any
foreseeable charges or dividends and non-controlling interests; ii) and deductions related to own shares and loans
to finance the acquisition of shares of the Bank, the shortfall of value adjustments and provisions to expected
losses concerning risk\u2010weighted exposure amounts calculated according to the IRB approach, goodwill and other
intangible assets and the additional value adjustments necessary for the prudent valuation requirements applied
to all assets at fair value, adjustments related to minimum commitment with collective investments undertakings,
insufficient coverage for non-performing exposures and with the amount of securitisation positions, eligible for
deduction as an alternative to a 1 250 % risk weight. Reserves and retained earnings are adjusted by the reversal of
unrealised gains and losses on cash-flow hedge transactions and on financial liabilities valued at fair value through
profits and losses, to the extent related to own credit risk. The non-controlling interests are only eligible up to the
amount of the Group\u2019s capital requirements attributable to the minorities. In addition, the deferred tax assets
arising from unused tax losses carried forward are deducted, as well as the deferred tax assets arising from
temporary differences relying on the future profitability and the interests held in financial institutions and insurers
of at least 10%, in this case only in the amount that exceeds the thresholds of 10% and 15% of the common equity
tier 1, when analysed on an individual and aggregated basis, respectively. The irrevocable payment commitments
for the Single Resolution Fund and the additional coverage for non-performing exposures, are also deducted, due
to a SREP (Supervisory Review and Evaluation Process) recommendation.
Additional tier 1 comprises preference shares, hybrid instruments and perpetual bonds representing subordinated
debt that are compliant with the issue conditions established in the Regulation, deducted from amounts related
to loans granted to finance its acquisition and non-controlling interests related to minimum level 1 additional
capital requirements of institutions that are not totally owned by the Group.
Tier 2 includes the subordinated debt that is compliant with the Regulation, deducted from amounts related to
loans granted to finance its acquisition and the non-controlling interests related to minimum total capital
requirements of institutions that are not totally owned by the Group. Additionally, Tier 2 instruments held in
financial institutions and insurers of at least 10% are deducted.
According to the legislation in force, the capital requirements applicable to the Group, as at 31 December 2025, are
as follows:\u00a0
2025 Minimum Capital Requirements
BCP Consolidated
Total
of which:
Pilar 1
Pilar 2
Buffers (*)
CET1
9.89%
4.50%
1.27%
4.12%
T1
11.81%
6.00%
1.69%
4.12%
Total
14.37%
8.00%
2.25%
4.12%
(*) Capital conservation buffer (CCB), other systemically important institution (O-SII), institution specific countercyclical capital buffer (CCyB) e de
systemic risk buffer (SyRB).
The Group meets all the requirements and other recommendations issued by the supervisor on this matter.
The Group has adopted the methodologies based on internal rating models (IRB) for the calculation of capital
requirements for credit and counterparty risk, covering a substantial part of both its retail portfolio in Portugal and
Poland and its corporate portfolio in Portugal. The Group has adopted the advanced approach (internal model) for
the coverage of trading portfolio\u2019s general market risk and for exchange rate risks generated in exposures in the
perimeter centrally managed from Portugal, and the standard method was used for the purposes of operational
risk coverage. The capital requirements of the other portfolios/geographies were calculated using the
standardised approach.
The own funds and the capital requirements determined according to the CRD IV/CRR (phased-in) methodologies
previously referred, are the following:
(Thousands of euros)
2025
2024
Common equity tier 1 (CET1)
Share capital
3,000,000
3,000,000
Share Premium
16,471
16,471
Reserves and retained earnings
3,626,248
3,018,648
Non-controlling interests eligible to CET1
726,109
551,239
Regulatory adjustments to CET1
(446,530)
(23,119)
6,922,298
6,563,239
Tier 1
Equity instruments
400,000
400,000
Non-controlling interests eligible to AT1
97,274
93,372
Regulatory adjustments
(865)
\u2014
7,418,707
7,056,611
Tier 2
Subordinated debt
989,508
992,236
Non-controlling interests eligible to Tier 2
205,245
219,321
Other
44,726
(2,483)
1,239,479
1,209,074
Total own funds
8,658,186
8,265,685
RWA - Risk weighted assets
Credit risk
34,660,799
33,909,206
Market risk
568,756
853,385
Operational risk
7,656,279.94
5,312,735
CVA
15,708
52,685
42,901,542.94
40,128,011
Capital ratios
CET1
16.1%
16.4%
Tier 1
17.3%
17.6%
Tier 2
2.9%
3.0%
Total own funds
20.2%
20.6%
The presented amounts include the accumulated net income.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators set by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also fixed.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is
based on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are
calculated on a daily basis, taking into account the impact on the liquidity buffers available to discount with the
respective central banks at the reference date of future estimated cash flows for each of the respective time
horizon (3 days or 3 months) considering the set of transactions intermediated by the market areas, including
transactions carried out with Corporate and Private networks customers, which, due to their size, must be quoted
by the Trading Room. The remaining buffer in each time bucket is then compared to the amount of customer
deposits, being the indicators assessed against exposure limits defined in the Group's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis, identifying all
the factors that justify the variations that have occurred. This analysis is submitted to the Capital and Assets and
Liabilities Committee (CALCO) for appraisal, with a view to making decisions that lead to the maintenance of
financing conditions adequate to the business sustainability.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterise the Bank's risk profile and to ensure that the Group
and each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support
the liquidity contingency plan and management decisions.
The Group\u2019s liquidity position remained resilient throughout 2025, supported by a significant increase in on
balance sheet customer funds (+7.0% year-on-year on a consolidated basis), driven mainly by the strong
momentum of the Polish operation (+13,0%). Credit started a growth trend, rising by 7,3% at Group level, largely
fueled by the solid performance in Portugal (+9.3%). From a balance sheet perspective, the growth in on-balance
sheet funds once again exceeded that of loans, generating a liquidity surplus that supported the expansion of the
securities portfolio, which grew 15.0% at group level.
As a result, liquidity buffers held with central banks remained robust, increasing in the three main geographies.
Key regulatory and internal liquidity risk indicators continued to display comfortable levels.
As at 31 December 2025, with regard to short-term liquidity, the Liquidity Coverage Ratio (LCR) stood at 334% on a
consolidated basis, compared to 342% at the same date in the previous year, ensuring a comfortable buffer above
the minimum regulatory requirement of 100%.
From a structural perspective, the Group maintained its stable funding base, primarily supported by customer
deposits\u2014particularly in the retail segment\u2014and complemented by medium and long-term funding instruments,
namely issuances under the MREL framework and the Bank Millennium covered bond programme. As a result, as
at 31 December 2025, the Net Stable Funding Ratio (NSFR) reached 180%, broadly in line with the 181% recorded
one year earlier, thereby maintaining a substantial buffer above the minimum regulatory requirement of 100%.
The loan-to-deposit ratio stood at 68% at the end of December 2025, close to the ratio observed on the same date
the previous year., reflecting a prudent balance sheet management approach alongside the recovery of lending
activity in Portugal since the beginning of the year.
Following important rating upgrades since 2023, by the end of 2025 BCP\u2019s subordinated debt was assessed as
investment grade by S&P, Moody\u2019s and DBRS. From January 2025 the spread of BCP in Senior Preferred (\u201cSP\u201d) and
subordinated debt (\u201cT2\u201d) tightened materially, due not only to market conditions but also to the strong positive
BCP\u2019s intrinsic factors. During 2025, BCP executed three transactions in the wholesale market: on 20 March a EUR
500,000,000 12nc7 4,750% T2 Notes, to refinance the call-option on 27 March of the EUR 450,000,000 3,871%
10,5nc5,5 T2 Notes; at the same date the Bank launched a Tender Offer on BCP\u2019s EUR 166,000,000 6.888% 2027 T2
Notes which remained outstanding after the 2022 Exchange Offer, with valid tenders in an aggregate nominal
amount of EUR 79,500,000, and decided to accept for purchase all Notes validly tendered; on 24 June, a EUR
500,000,000 6NC5 3.125% SP Notes to refinance the exercise, on 2 October and also in favourable pricing
conditions, of the call-option on the EUR 500,000,000 5.625% SP Notes.
The liquidity buffer available with the ECB amounted to EUR 34,725,574,000 at the end of 2025, EUR 977,437,000
higher than one year earlier. At the end of 2025, the liquidity buffer included a long position of EUR 1,739,808,000
with the ECB.
Throughout 2025, in addition to increasing its deposit\u2019s base, Bank Millennium reinforced its structural liquidity
position through the execution of covered bond issuances of PLN 800,000,000 in March and PLN 1,000,000,000 in
November. As a result, the outstanding balance of the instrument reached PLN 2,600,000,000 as at December
2025.
Millennium Bim maintained during 2025 a robust liquidity position, based on the stability of its local deposits\u2019
base.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after
haircuts, is detailed as follows:
(Thousands of euros)
2025
2024
European Central Bank
14,965,278
15,437,781
Other Central Banks
13,676,940
10,001,379
28,642,218
25,439,160
The amount discounted with the Bank of Mozambique amounts to EUR 398,000 (31\u00a0December 2024: EUR
755,000). There are no discounted amounts with other central banks.
The evolution of the ECB\u2019s Monetary Policy Pool, of the net borrowings at the ECB and of the liquidity buffer is
analysed as follows:
(Thousands of euros)
2025
2024
Collateral eligible for ECB, after haircuts:
The pool of ECB monetary policy (i)
14,965,278
15,437,781
Outside the pool of ECB monetary policy
18,020,487
15,489,545
32,985,765
30,927,326
Net borrowing at the ECB (ii)
(1,739,808)
(2,820,810)
Liquidity buffer (iii)
34,725,573
33,748,136
i) Corresponds to the amount reported in ECMS (Banco de Portugal application).
ii) Includes as at 31 December 2025 the amount of deposits with the Banco de Portugal and other liquidity with the Eurosystem (EUR 2,296,690,000) in
excess over the minimum cash reserves (EUR 556,882,000).
iii) Eligible collateral available for discount with the ECB, after haircuts, deducted from the net funding at the ECB.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels
over the next years, with no material impact, considering the liquidity buffers of the issuing entities.
", "dimensions": { "concept": "ifrs-full:DisclosureOfObjectivesPoliciesAndProcessesForManagingCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-717": { "value": "Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to customers, fair value is estimated through internal models based on cash-flow
discounting techniques. Cash-flows for the different instruments sold are calculated according to its financial
characteristics and the discount rates used include both the market interest rate curve and the current conditions
of the Group's pricing policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree
of judgement and reflects exclusively the value attributed to different financial instruments. However, it does not
consider prospective factors, as the future business evolution. Therefore, the values presented cannot be
understood as an estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial
liabilities are presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions
repayable on demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable
estimate of its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and other
funds and Assets with repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future
cash flows for these instruments, considering that the payments of the instalments occur in the contractually
defined dates. This update is made based on the prevailing market rate for the term of each cash flow plus the
average spread of the production of the most recent 3 months of the same. For the elements with signs of
impairment, the net impairment of these operations is considered as a reasonable estimate of their fair value,
considering the economic valuation that is realised in the determination of this impairment.
For Deposits from Central Banks and other funds, it was considered that the book value is a reasonable estimate
of its fair value, given the nature of operations and the associated short-term.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied
by the Group on identical instruments for each of the different residual maturities (rates from the monetary
market or from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to
conditions used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of
its fair value (this class incorporates among other, factoring operations, current account credit, credit cards and
overdrafts in demand deposits).
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined
dates. For loans with signs of impairment (Stage 3 loans), the net impairment of these operations is considered as
a reasonable estimate of their fair value, considering the economic valuation that is realised in the determination
of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes
of this type of instruments and with similar residual maturity. The discount rate includes the market rates for the
residual maturity date (rates from the monetary market or from the interest rate swap market) and the spread
used at the date of the report, which was calculated from the average production of the three most recent
months compared to the reporting date.
Deposits from customers and other funds
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar
maturity. The discount rate includes the market rates of the residual maturity date (rates of monetary market or
the interest rate swap market, at the end of the period) and the actual spread of the Group. This was calculated
from the average production of the three most recent months compared to the reporting date.
As in the case of credits without defined maturity, also for the Deposits from customers without defined maturity
(demand deposits) it is considered that given the potential short term of the same, possibility of their liquidation at
any time, the book value of these liabilities is a reasonable estimate of their fair value.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers,
Deposits from credit institutions and other funds and Deposits from customers and other funds are analysed as
follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Deposits from credit
institutions and other
funds
Deposits from customers
and other funds
2025
2024
2025
2024
2025
2024
2025
2024
EUR
1.75%
3.39%
4.70%
4.42%
1.82%
3.30%
2.30%
3.24%
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
4.27%
4.70%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
3.48%
2.59%
3.46%
CHF
n.a.
n.a.
2.94%
2.69%
n.a.
n.a.
0.11%
0.65%
CNY
n.a.
n.a.
1.65%
3.50%
n.a.
n.a.
1.25%
3.55%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.19%
2.62%
GBP
n.a.
n.a.
n.a.
n.a.
4.06%
5.28%
3.89%
5.01%
HKD
n.a.
n.a.
2.82%
4.01%
n.a.
n.a.
2.80%
4.82%
MOP
n.a.
n.a.
2.80%
3.87%
2.96%
n.a.
2.96%
4.51%
MZN
9.92%
14.20%
16.67%
18.95%
n.a.
n.a.
7.64%
11.16%
NOK
n.a.
n.a.
n.a.
7.68%
n.a.
n.a.
4.36%
4.92%
PLN
4.48%
5.53%
8.14%
8.81%
5.26%
4.66%
4.60%
5.78%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.22%
2.86%
USD
4.14%
4.66%
4.71%
6.13%
4.05%
4.89%
3.21%
4.02%
ZAR
4.18%
8.24%
11.28%
12.62%
n.a.
n.a.
2.88%
5.15%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives) and financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"),
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
In this class of assets, the fair value corresponds to their book value.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering
the volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the
available models do not fully apply to meet the characteristics of the financial instrument, specific quotations
supplied by an external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt instruments
These financial instruments are accounted at amortised cost net of impairment, as referred in the accounting
policy described in note 1 C1.1.1. The fair value of this class of assets, is based on market prices, whenever these are
available. If market prices are not available, fair value is estimated through numerical models based on cash-flow
discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical
cash-flow discounting techniques and models for assessment of options considering variables of the market,
particularly the interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters
and Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates
are obtained from similar sources but regarding interbank money market. The interest rate curve obtained is
calibrated with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are
determined by appropriate interpolation methods. The same interest rate curves are used in the forecast of the
non-deterministic cash flows such as indexes. The remaining market inputs, such as yield curves, credit, exchange
rates, among others, are also made available by financial content providers.
Debt securities non-subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet
reflected in the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-
accounting\", the fair value related to the interest rate risk is already recognised. For the fair value calculation, other
components of risk were considered, in addition to the interest rate risk already recorded, when applicable. The
fair value is based on market prices, whenever these are available. If market prices are not available, fair value is
estimated through numerical models based on cash-flow discounting techniques, using the market interest rate
curve adjusted by associated factors, predominantly credit risk and trading margin, the latter only in the case of
issues placed on non-institutional customers of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps
established specifically for each term and class of instruments based on the market prices on equivalent
instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the
cost obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies
used in the determination of the fair value of the issues is analysed as follows:
2025
2024
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
5.41%
0.00%
5.06%
0.00%
Senior
3.01%
0.00%
3.03%
0.00%
Placed in retail
Senior and collateralised
2.90%
3.68%
3.11%
4.94%
For Non-subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of EUR 22,162,000 (31\u00a0December 2024: a
positive amount of EUR 22,410,000) and includes a payable amount of EUR 22,531,000 (31\u00a0December 2024: a
payable amount of EUR 42,477,000) which reflects the fair value of embedded derivatives and are recorded in
financial assets and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2025
2024
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.01%
3.69%
3.73%
5.02%
2.98%
4.45%
4.87%
5.73%
7 days
1.98%
3.73%
3.72%
5.19%
2.98%
4.41%
4.86%
5.73%
1 month
2.03%
3.77%
3.83%
5.23%
2.95%
4.41%
4.80%
5.72%
2 months
2.04%
3.77%
3.89%
5.16%
2.89%
4.42%
4.78%
5.73%
3 months
2.09%
3.81%
3.90%
5.10%
2.81%
4.44%
4.78%
5.74%
6 months
2.16%
3.79%
3.91%
4.88%
2.59%
4.46%
4.79%
5.70%
9 months
2.23%
3.77%
3.92%
4.76%
2.49%
4.48%
4.81%
5.61%
1 year
2.15%
3.68%
3.67%
4.60%
2.33%
4.43%
4.82%
5.62%
2 years
2.23%
3.55%
3.71%
4.21%
2.19%
4.34%
4.51%
5.22%
3 years
2.35%
3.58%
3.83%
4.09%
2.19%
4.32%
4.40%
5.03%
5 years
2.55%
3.70%
3.97%
4.13%
2.24%
4.31%
4.29%
4.99%
7 years
2.71%
3.86%
4.19%
4.25%
2.29%
4.32%
4.26%
5.04%
10 years
2.92%
4.07%
4.49%
4.49%
2.36%
4.34%
4.31%
5.15%
15 years
3.16%
4.37%
4.66%
4.88%
2.42%
4.39%
4.43%
5.31%
20 years
3.26%
4.52%
4.68%
4.87%
2.36%
4.37%
4.49%
5.35%
30 years
3.25%
4.46%
4.72%
4.84%
2.15%
4.21%
4.46%
5.35%
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
4,089,540
4,089,540
4,089,540
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
186,011
186,011
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
861,245
861,245
829,391
Loans and advances to customers (i)
\u2014
\u2014
57,406,675
57,406,675
56,511,413
Debt securities
\u2014
\u2014
24,538,875
24,538,875
24,552,771
Financial assets at fair value
Loans and advances to customers
9,400
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
202,495
10,647,475
\u2014
10,849,970
10,849,970
Bonds issued by public companies and
other entities
1,076
2,105,881
\u2014
2,106,957
2,106,957
Treasury bills
587,739
3,261,877
\u2014
3,849,616
3,849,616
Shares
63,700
30,539
\u2014
94,239
94,239
Investment units
289,801
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
115,370
Trading derivatives
147,302
\u2014
\u2014
147,302
147,302
Hedging derivatives (ii)
32,365
\u2014
\u2014
32,365
32,365
1,449,248
16,045,772
87,082,346
104,577,366
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
878,571
878,571
805,842
Deposits from customers and other funds
\u2014
\u2014
87,672,860
87,672,860
87,663,994
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,893,593
3,893,593
3,915,755
Subordinated debt (i)
\u2014
\u2014
1,411,658
1,411,658
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
2,075,969
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
1,538,366
Short selling securities
8,949
\u2014
\u2014
8,949
8,949
Trading derivatives
143,780
\u2014
\u2014
143,780
143,780
Hedging derivatives (ii)
42,728
\u2014
\u2014
42,728
42,728
3,809,792
\u2014
93,856,682
97,666,474
97,626,912
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group includes in the Book value column of the balance Financial assets at amortised cost - Debt securities
the variation in the fair value of the hedged element attributable to the hedged risk (risk of interest rate) for
securities to which the Group is applying fair value hedge accounting.
The following table shows the fair value of financial assets and liabilities of the Group, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Fair value
through
profit or loss
Fair value
through other
comprehensive
income
Amortised
cost
Book value
Fair value
Assets
Cash and deposits at Central Banks
\u2014
\u2014
5,589,030
5,589,030
5,589,030
Loans and advances to credit institutions
repayable on demand
\u2014
\u2014
251,157
251,157
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
797,535
797,535
787,632
Loans and advances to customers (i)
\u2014
\u2014
53,907,058
53,907,058
52,984,229
Debt securities
\u2014
\u2014
21,345,171
21,345,171
21,047,438
Financial assets at fair value
Loans and advances to customers
427
\u2014
\u2014
427
427
Bonds issued by public entities
175,206
8,411,395
\u2014
8,586,601
8,586,601
Bonds issued by public companies and
other entities
413
1,970,392
\u2014
1,970,805
1,970,805
Treasury bills
1,117,504
2,490,850
\u2014
3,608,354
3,608,354
Shares
60,352
26,329
\u2014
86,681
86,681
Investment units
323,969
\u2014
\u2014
323,969
323,969
Other securities
87,563
\u2014
\u2014
87,563
87,563
Trading derivatives
387,073
\u2014
\u2014
387,073
387,073
Hedging derivatives (ii)
69,349
\u2014
\u2014
69,349
69,349
2,221,856
12,898,966
81,889,951
97,010,773
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other
funds
\u2014
\u2014
777,719
777,719
781,443
Deposits from customers and other funds
\u2014
\u2014
82,084,687
82,084,687
81,945,936
Non-subordinated debt securities issued (i)
\u2014
\u2014
3,528,710
3,528,710
3,551,120
Subordinated debt (i)
\u2014
\u2014
1,427,359
1,427,359
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
1,956,851
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
1,292,006
Short selling securities
44,607
\u2014
\u2014
44,607
44,607
Trading derivatives
135,020
\u2014
\u2014
135,020
135,020
Hedging derivatives (ii)
39,041
\u2014
\u2014
39,041
39,041
3,467,525
\u2014
87,818,475
91,286,000
91,236,905
(i) The book value includes the effect of the adjustments resulting from the application of hedge accounting;
(ii)\u00a0 \u00a0 Includes a portion that is recognised in reserves in the application of accounting cash flow hedge.
The Group classified the financial instruments recorded in the balance sheet at fair value in accordance with the
hierarchy established in IFRS 13. The fair value of financial instruments is determined using quotations recorded in
active and liquid markets, considering that a market is active and liquid whenever its stakeholders conduct
transactions on a regular basis giving liquidity to the instruments traded. When it is verified that there are no
transactions that regularly provide liquidity to the traded instruments, valuation methods and techniques are
used to determine the fair value of the financial instruments.
Level 1 - With quotation in active market
In this category are included, in addition to financial instruments traded on a regulated market, bonds and units of
investment funds valued based on the prices disclosed through trading systems.
The classification of the fair value of level 1 is used when:
i. there is a firm daily enforceable quotation for the financial instruments concerned, or;
ii. there is a quotation available in market information systems that aggregate multiple prices of various
stakeholders.
Level 2 - Valuation methods and techniques based on market data
Financial instruments, when there are no regular transactions in the active and liquid markets (level 1), are
classified in level 2, according to the following rules:
i. failure to comply with the rules defined for level 1, or;
ii. they are valued based on valuation methods and techniques that use mostly observable market data (interest
rate or exchange rate curves, credit curves, etc.).
Level 2 includes over-the-counter derivative financial instruments contracted with counterparties with which the
Group maintains collateral agreements (ISDAs with Credit Support Annex (CSA)). In addition, derivative financial
instruments traded in the over-the-counter market, which, despite not having CSA agreements, the non-
observable market data component (i.e., internal ratings, default probabilities determined by internal models, etc.)
incorporated in the estimation of CVA/DVA is not significant in the overall value of the derivative. In order to assess
the significance of this component, the Group defined a quantitative relevance criterion and performed a
qualitative sensitivity analysis on the valuation component that includes unobservable market data.
Level 3 - Valuation methods and techniques based on data not observable in the
market
If the level 1 or level 2 criteria are not met, financial instruments should be classified in level 3, as well as in
situations where the fair value of financial instruments results from the use of information not observable in the
market, such as:
- financial instruments which are not classified as level 1 and which are valued using evaluation methods and
techniques without being known or where there is consensus on the criteria to be used, namely:
i. - those measured using comparative price analysis of financial instruments with risk and return profile, typology,
seniority or other similar factors, observable in the active and liquid markets;
ii. - those measured using performance indicators of the underlying transactions (e.g. default probability rates of
the underlying assets, delinquency rates, evolution of the ratings, etc.);
iii. - those measured taking as reference the NAV (Net Asset Value) disclosed by the management entities of
securities/real estate/other investment funds not listed on a regulated market.
Level 3 includes over-the-counter derivative financial instruments that have been contracted with counterparties
with which the Group does not maintain collateral exchange agreements, and whose unobservable market data
component incorporated in the estimation of the value adjustment, such as those relating to synthetic
securitisation operations carried out by the Group.
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2025:
(Thousands of euros)
2025
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
4,089,540
Loans and advances to credit institutions repayable on
demand
186,011
\u2014
\u2014
186,011
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
829,391
829,391
Loans and advances to customers
\u2014
\u2014
56,511,413
56,511,413
Debt securities
20,342,177
1,039,152
3,171,442
24,552,771
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
9,400
9,400
Bonds issued by public entities
10,811,416
25,224
13,330
10,849,970
Bonds issued by public companies and other entities
1,951,759
155,198
\u2014
2,106,957
Treasury bills
1,345,214
2,504,402
\u2014
3,849,616
Shares
58
\u2014
94,181
94,239
Investment units
\u2014
\u2014
289,801
289,801
Other securities
115,370
\u2014
\u2014
115,370
Trading derivatives
\u2014
124,541
22,761
147,302
Hedging derivatives
\u2014
32,365
\u2014
32,365
38,841,545
3,880,882
60,941,719
103,664,146
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
805,842
805,842
Deposits from customers and other funds
\u2014
\u2014
87,663,994
87,663,994
Non-subordinated debt securities issued
\u2014
\u2014
3,915,755
3,915,755
Subordinated debt
\u2014
\u2014
1,431,529
1,431,529
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
2,075,969
2,075,969
Non-subordinated debt securities issued
1,538,366
\u2014
\u2014
1,538,366
Short selling securities
\u2014
\u2014
8,949
8,949
Trading derivatives
\u2014
120,807
22,973
143,780
Hedging derivatives
\u2014
42,728
\u2014
42,728
1,538,366
163,535
95,925,011
97,626,912
The following table shows, by valuation levels, the fair value of financial assets and liabilities of the Group as at
31\u00a0December 2024:
(Thousands of euros)
2024
Level 1
Level 2
Level 3
Total
Assets
Cash and deposits at Central Banks
5,589,030
\u2014
\u2014
5,589,030
Loans and advances to credit institutions repayable on
demand
251,157
\u2014
\u2014
251,157
Financial assets at amortised cost
Loans and advances to credit institutions
\u2014
\u2014
787,632
787,632
Loans and advances to customers
\u2014
\u2014
52,984,229
52,984,229
Debt securities
17,779,491
462,939
2,805,008
21,047,438
Financial assets at fair value
Loans and advances to customers
\u2014
\u2014
427
427
Bonds issued by public entities
8,539,158
26,198
21,245
8,586,601
Bonds issued by public companies and other entities
1,812,602
98,640
59,563
1,970,805
Treasury bills
1,454,611
2,153,743
\u2014
3,608,354
Shares
29,587
\u2014
57,094
86,681
Investment units
\u2014
\u2014
323,969
323,969
Other securities
87,108
\u2014
455
87,563
Trading derivatives
\u2014
109,695
277,378
387,073
Hedging derivatives
\u2014
69,349
\u2014
69,349
35,542,744
2,920,564
57,317,000
95,780,308
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
\u2014
\u2014
781,443
781,443
Deposits from customers and other funds
\u2014
\u2014
81,945,936
81,945,936
Non-subordinated debt securities issued
\u2014
\u2014
3,551,120
3,551,120
Subordinated debt
\u2014
\u2014
1,490,881
1,490,881
Financial liabilities at fair value
Deposits from customers and other funds
\u2014
\u2014
1,956,851
1,956,851
Non-subordinated debt securities issued
1,292,006
\u2014
\u2014
1,292,006
Short selling securities
\u2014
\u2014
44,607
44,607
Trading derivatives
\u2014
91,526
43,494
135,020
Hedging derivatives
\u2014
39,041
\u2014
39,041
1,292,006
130,567
89,814,332
91,236,905
The changes that occurred during 2025 in financial assets and liabilities accounted for at fair value and classified at
level 3, are detailed as follows:
(Thousands of euros)
2025
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
277,832
355,211
107,088
43,494
Gains / (losses) recognised in profit or loss
Net trading income
(72)
3,777
\u2014
(19,946)
Net interest income
\u2014
1,250
24
\u2014
Transfers between levels
(54)
\u2014
(59,463)
\u2014
Capital increases (Investment units)
\u2014
42,065
\u2014
\u2014
Capital reductions (Investment units)
\u2014
(68,651)
\u2014
\u2014
Purchases
22,761
20,712
14,817
442
Sales
(277,706)
(731)
(12,371)
(1,017)
Amortisations
\u2014
(51)
(5,671)
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
2,181
\u2014
Exchange rate differences
\u2014
37
(2,672)
\u2014
Accrued interest
\u2014
\u2014
(62)
\u2014
Balance as at 31 December
22,761
353,619
43,871
22,973
(*) Do not include short sales in the amount of EUR 8,949,000 (note 37).
In 2025, the unobservable inputs included in the valuation of two issues recorded in the portfolio of financial assets
at fair value through other comprehensive income, under the balance Transfers between levels, lost relevance and,
therefore, the securities were classified as level 2 in the fair value hierarchy.
The changes that occurred during 2024 in financial assets and liabilities accounted for at fair value and classified
at level 3, are detailed as follows:
(Thousands of euros)
2024
Financial assets
held for
trading
not held for trading
mandatorily at fair
value through profit
or loss
at fair value
through other
comprehensive
income
Financial
liabilities held
for trading (*)
Balance as at 1 January
332,705
433,603
101,427
97,994
Gains / (losses) recognised in profit or loss
Net trading income
6,569
1,827
\u2014
(52,808)
Net interest income
31
763
88
\u2014
\u00a0 Impairment
\u2014
(73,891)
\u2014
\u2014
Transfers between portfolios
54
\u2014
\u2014
\u2014
Transfers between levels
\u2014
621
\u2014
\u2014
Capital increases (Investment units)
\u2014
(25,567)
\u2014
\u2014
Capital reductions (Investment units)
14,077
7,873
67,586
695
Purchases
(75,604)
(15,991)
(544)
(2,387)
Sales
\u2014
\u2014
(65,604)
\u2014
Amortisations
\u2014
\u2014
3,600
\u2014
Gains / (losses) recognised in reserves
\u2014
\u2014
992
\u2014
Exchange rate differences
\u2014
960
(457)
\u2014
Accrued interest
\u2014
25,013
\u2014
\u2014
Balance as at 31 December
277,832
355,211
107,088
43,494
(*) Do not include short sales in the amount of EUR 44,607,000 (note 37).
The balance Transfer between portfolios in the amount of EUR 73,891,000 refers to the classification of Fundo
Turismo Algarve, FCR as associate at the end of 2024.
In 2024, there were no relevant transfers relating to the measurement of financial instruments with respect to
valuation levels.
The Group prepared a sensitivity analysis of the variation in the probability of default by 1 percentage point (2
percentage points for the Caravela 6 operation) at the fair value of the credit default swaps recognised by level 3,
with an estimated impact of around EUR 21,000 (31\u00a0December 2024: EUR 61,000).
The remaining unlisted instruments classified at level 3 are essentially venture capital funds with recognised
valuation based on the information provided by the management entities. The variation of 1% in the quotation
value of these assets impacts the balance sheet value of the same magnitude.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFairValueMeasurementExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-718": { "value": "Post-employment benefits and other long-term benefits
The Group assumed the liability to pay to their employees' pensions on retirement or disability and other
obligations, in accordance with the accounting policy described in note 1 R.
The number of participants in the Pension Fund of Banco Comercial Portugu\u00eas covered by this pension plan and
other benefits is analysed as follows:
Number of participants
2025
2024
Retirees and pensioners
17,215
17,135
Former participants with acquired rights
6,607
3,395
Employees
6,123
6,288
29,945
26,818
In 2025 the population of form participants increased by 3,212, with 3,261 of the new former participants referring
to employees who left in previous years.
Until 2025, the database of former participants included only employees who left after 2001 and who were covered
by Caixa de Abono de Fam\u00edlia dos Empregados Banc\u00e1rios (Bank Employees' Family Benefits Fund) ( former
CAFEB) at the time they left.\u00a0 For employees who left before that date, it had been assumed that they moved to
other banks and therefore remained within the banking sector, and as such would not claim a pension from BCP
for their length of service.
Considering the experience of recent years, it was observed that, among the group of former employees who left
before 2001, requests were being made for a supplementary pension for the length of service at BCP. Accordingly,
a study was carried out to ascertain how likely these claims were to occur and, as a result of this study, around
3,261 former employees who left before 2001 were added to the database. It was also determined that, on average,
around 66.66% of this group of potential former employees have been submitting pension claims.
In accordance with the accounting policy described in note 1 R, the Group's retirement pension liabilities and
other benefits and the respective coverage, based on the Projected Unit Credit method are analysed as follows:
(Thousands of euros)
2025
2024
Actual amount of the past services
Retirees and pensioners
2,342,769
2,431,591
Former participants with acquired rights
196,638
185,748
Employees
485,454
585,913
3,024,861
3,203,252
Pension fund value
(3,308,547)
(3,351,481)
Net (assets) / liabilities in balance sheet (note 32)
(283,686)
(148,229)
In 2017, following the authorisation of the Insurance and Pension Funds Supervisory Authority, the BCP group's
pension fund agreement was amended. The main purpose of this process was to incorporate into the pension
fund the changes made to the Group's Collective Labour Agreement (CLA) in terms of retirement benefits and to
pass on to the pension fund the responsibilities that were directly in charge by the companies (extra-fund
liabilities). The pension fund has a share exclusively related to the financing of these liabilities, which under the
scope of the fund is called an Additional Complement, which as at 31\u00a0December 2025 amounts to EUR 166,805,000
(31\u00a0December 2024: EUR 185,960,000). The End of Career Premium also came to be borne by the pension fund
under the basic pension plan.
During 2025, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements,
for the conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, an increase of 2.50% was agreed on 2 January 2025 for salary tables and other pecuniary clauses
for the year 2025, with the unions: \u201cSBN \u2013 Sindicato dos Trabalhadores do Setor Financeiro de Portugal\u201d, \u201cSBC -
Sindicato Nacional dos Trabalhadores da Banca, Seguros e Tecnologias\u201d and \u201cSindicato da Banca, Seguros e
Tecnologias - MAIS SINDICATO\u201d, within the scope of the mediation process which took place at Government
Labour Minister Department \u201cDGERT \u2013 Dire\u00e7\u00e3o-Geral do Emprego e das Rela\u00e7\u00f5es de Trabalho\u201d, and according
with the proposal presented by this entity on 23 December 2024 to the parties under mediation.
Negotiations are also taking place with the \u201cSIB \u2013 Sindicato Independente da Banca\u201d for the review of salary tables
and other pecuniary expression clauses relating to the years 2024 and 2025, as well as negotiations with the
\u201cSindicato Nacional dos Quadros T\u00e9cnicos Banc\u00e1rios (SNQTB)\u201d for the 2025 review.
The change in the projected benefit obligations is analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
3,203,252
3,079,575
Service cost
(9,717)
(9,738)
Interest expense / (income)
112,151
108,234
Actuarial (gains) / losses
Not related to changes in assumptions
36,549
78,644
Related to changes in assumptions
(171,130)
90,836
Payments
(174,035)
(161,897)
Early retirement programmes and terminations by mutual agreement
20,656
10,478
Contributions of employees
7,135
7,120
Balance at the end of the year
3,024,861
3,203,252
The pensions paid by the Fund, including the Additional Complement, amounts to EUR 174,035,000 (31\u00a0December
2024: EUR 161,897,000).
The liabilities with health benefits are fully covered by the Pension Fund and correspond to EUR 242,123,000
(31\u00a0December 2024: EUR 261,862,000).
Additionally, regarding the coverage of some benefit obligations related to pensions, the Group contracted with
Ocidental Vida the acquisition of perpetual annuities for which the total liability amounts to EUR 30,426,000
(31\u00a0December 2024: EUR 31,864,000), in order to pay:
i) pensions of former Group's Board Members in accordance with the Bank's Board Members Retirement
Regulation;
ii) pensions and complementary pensions to pensioners in accordance with the Pension Fund of the BCP Group
employees established in 28 December 1987, as also to pensioners, in accordance with other Pension Funds, that
were incorporated after on the BCP Group Pension Fund and which were planed that the retirement benefits
should be paid through the acquisition of insurance policies, in accordance with the Decree - Law no. 12/2006.
Ocidental Vida is 100% owned by Ageas Group and Ageas Group is 49% owned by the BCP Group.
The changes occurred in the plan's assets value is analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
3,351,481
3,469,833
Employees' contributions
7,135
7,120
Actuarial gains / (losses)
11,772
(78,110)
Payments
(174,035)
(161,897)
Expected return on plan assets
112,194
114,535
Balance at the end of the year
3,308,547
3,351,481
The elements of the Pension Fund's assets are analysed as follows:
(Thousands of euros)
2025
2024
Asset class
Assets with
market price in
active market
Remaining
Total
Portfolio
Assets with
market price in
active market
Remaining
Total
Portfolio
Shares
21,406
1,309
22,715
99,659
1,315
100,974
Bonds and other fixed
income securities
1,699,555
\u2014
1,699,555
1,988,476
\u2014
1,988,476
Investment units in
securities funds
\u2014
785,969
785,969
\u2014
515,838
515,838
Investment units in real
estate funds
\u2014
330,874
330,874
\u2014
313,945
313,945
Properties
\u2014
269,348
269,348
\u2014
264,968
264,968
Loans and advances to
credit institutions and
others
\u2014
200,086
200,086
\u2014
167,280
167,280
1,720,961
1,587,586
3,308,547
2,088,135
1,263,346
3,351,481
The balance Properties includes buildings booked in the Fund's financial statements and used by the Group's
companies which amount to EUR 227,346,000 (31\u00a0December 2024: EUR 227,346,000).
The securities issued by Group's companies accounted in the portfolio of the Fund are analysed as follows:
(Thousands of euros)
2025
2024
Bonds and other fixed income securities
26,987
7,195
Loans and advances to credit institutions and others
73,700
8,191
100,687
15,386
The evolution of net (assets) / liabilities in the balance sheet is analysed as follows:
(Thousands of euros)
2025
2024
Balance as at 1 January
(148,229)
(390,258)
Recognised in the income statement:
Service cost
(9,717)
(9,738)
Interest expense / (income) net of the balance liabilities coverage
(43)
(6,301)
Cost with early retirement programmes
20,656
10,478
10,896
(5,561)
Recognised in the statement of comprehensive income:
Actuarial (gains) / losses
Not related to changes in assumptions
Difference between the estimated and the actual income of the fund
(11,772)
78,110
Difference between expected and effective liabilities
36,549
78,644
Arising from changes in assumptions
(171,130)
90,836
(146,353)
247,590
Balance at the end of the period
(283,686)
(148,229)
The estimate of contributions to be made in 2026, by the employees, for the Defined Benefit Plan amount to EUR
6,987,000.
In accordance with IAS 19, the Group accounted for (income)/expense with post-employment benefits, which is
analysed as follows:
(Thousands of euros)
2025
2024
Current service cost
(9,717)
(9,738)
Net interest expense /(income) in the liability coverage balance
(43)
(6,301)
Cost with early retirement programmes
20,656
10,478
(Income) / Expense of the year
10,896
(5,561)
Within the framework of the three-party agreement between the Government, the Banking and the Trade
Unions, the bank's employees in activity as at 31 December 2010 under the CAFEB/CLA regime were integrated
into the General Social Security System (RGSS) with effect from 1 January 2011. The integration led to an effective
decrease in the present value of the total benefits reported at the retirement age to be borne by the Pension
Fund, and this effect is recorded on a straight-line basis over the average period of active life until the normal
retirement age is reached. The calculation of the liability for pensions carried out periodically by the actuary
considers this effect and is calculated considering the actuarial assumptions in force, ensuring that the liabilities
calculated with reference to 31 December 2010, not considering the effect of the integration of bank employees
into the General Social Security Scheme are fully covered and deducted from the amount of the effect recognised
until the date. The component of this effect for the year is recognised under the heading \"Current service costs\".
Board of Directors Plan
As the Board of Directors Retirement Regulation establish that the pensions are subjected to an annual update,
and as it is not common in the insurance market the acquisition of perpetual annuities including variable updates
in pensions, the Bank determined, the liability to be recognised on the financial statements related to that update,
taking into consideration current actuarial assumptions.
In accordance with the remuneration policy of the Board Members, the Group has the responsibility of supporting
the cost with: i) the retirement pensions of former Group's Executive Board Members; and ii) the Complementary
Plan for these members in accordance with the applicable rules funded through the Pension Fund, Extra-fund
and perpetual annuities.
In order to cover liabilities with pensions to former members of the Executive Board of Directors, under the Bank's
Board of Directors Retirement Regulation the Group contracted with Ocidental Vida to purchase immediate life
annuity insurance policies.
Assumptions used in the liability's assessment
Considering the market indicators, particularly the inflation rate estimates and the long-term interest rate for Euro
Zone, as well as the demographic characteristics of its employees, the Group considered the following actuarial
assumptions for calculating the liabilities with pension obligations:
2025
2024
Salary growth rate (c)
2.15% in 2026, 1.65% in 2027
and 1.15% in the following
years
2.9% in 2025; 1.9% in 2026
and 1.15% in the following
years
Pension's growth rate (c)
1.75% in 2026, 1.25% in 2027
and 0.75% in the following
years
2.5% in 2025; 1.5% in 2026
and 0.75% in the following
years
Discount rate / Projected Fund's rate of return
4.13%
3.48%
Mortality tables
Men
TV 88/90 less a year
TV 88/90 less a year
Women (a)
TV 99/01 less 2 years
TV 99/01 less 2 years
Disability rate
Non applicable
Non applicable
Turnover rate
Non applicable
Non applicable
Normal retirement age (b)
66 years and 7 months
66 years and 4 months
Total salary growth rate for Social Security purposes
1.75%
1.75%
Revaluation rate of wages / pensions of Social Security
1%
1%
a) The mortality table considered for women corresponds to TV 99/01 adjusted in less than 2 years (which implies an increase in hope life
expectancy compared to that which would be considered in relation to their effective age).
b) Retirement age is variable. The normal retirement age increases one month for each civil year and cannot be higher than the normal retirement
age in force in the General Social Security Regime (RGSS). The normal retirement age in the RGSS is variable and depends on the evolution of the
average life expectancy at 65 years of age.
In 2025 the retirement age was 66 years and 7 months (2024: 66 years and 4 months). For 2026, the normal retirement age under the RGSS will
be 66 years and 9 months. For the forecast of life expectancy\u2019s increment, it was considered an increase of one year in every 10 years, with the
maximum retirement age being set at 67 years and 2 months.
c) This rate refers to the growth for the years following the reporting year.
The assumptions used on the calculation of the actuarial value of the liabilities are in accordance with the
requirements of IAS 19 and are determined based on the references of the entities under common control. No
disability decreases are considered in the calculation of the liabilities.
The discount rate used to update the Group's pension fund liabilities, regarding the defined benefit pension plans
of its employees and managers, was determined based on an analysis carried out on a set of available information,
which includes, among other elements, the market references for this indicator published by internationally
recognised specialised entities and which are based, as defined by IAS 19, on market yields of a universe of high
quality bond issues (low risk), different maturities, called in euro and relating to a diverse and representative range
of issuers (non-sovereign). As at 31\u00a0December 2025, the Group used a discount rate of 4.13% (31\u00a0December 2024:
3.48%).
The Actuarial gains are related to the difference between the actuarial assumptions used for the estimation of the
liabilities and the values verified and the change in actuarial assumptions, are analysed as follows:
(Thousands of euros)
Actuarial (gains) / losses
2025
2024
Values
effectively
verified in %
Amount
of deviations
Values
effectively
verified in %
Amount
of deviations
Deviation between expected and actual liabilities
36,549
78,644
Changes in the assumptions:
Discount rate
(230,807)
18,454
\u00a0 Salary and pensions growth rate
28,326
72,382
\u00a0 Other changes
31,351
\u2014
Deviation between expected income and income
from funds
3.92%
(11,772)
1.22%
78,110
(146,353)
247,590
In accordance with IAS 19, the sensitivity analysis to changes in assumptions, is as follows:
(Thousands of euros)
Impact resulting from changes in financial assumptions
2025
2024
-0.25%
0.25%
-0.25%
0.25%
Discount rate
87,377
(81,220)
100,232
(93,560)
Pension's increase rate
(96,067)
100,376
(109,962)
114,880
Salary growth rate
(22,567)
24,204
(26,411)
28,356
(Thousands of euros)
Impact resulting from changes in demographic assumptions
2025
2024
- 1 year
+ 1 year
- 1 year
+ 1 year
Changes in mortality table (*)
98,463
(98,654)
108,226
(108,415)
(*) The impact of 1 year reduction in the mortality table implies an increase in the average life expectancy
Defined contribution plan
According to what is described in accounting policy 1 R3, in the scope of the Defined Contribution Plan provided
for the BCP Pension Fund of the BCP Group for employees who have been admitted until 1 July 2009, it was
accounted for a cost, in 2025, of EUR 2,093,000 (2024: EUR 2,148,000) as an estimated contribution given that the
Group estimates that the following requirements will be met, cumulatively: (i) the previous year BCP's ROE equals
or exceeds the rate of government bonds of 10 years plus 5 percentage points, and (ii) distributable profits or
reserves exist in the accounts of Banco Comercial Portugu\u00eas.
For employees who have been admitted after 1 July 2009, are made monthly contributions equal to 1.5% of the
monthly remuneration received by employees in the current month, either by themselves or by the Group and
employees. This contribution has a mandatory character and is defined in the Collective Labour Agreement of the
BCP Group and does not have a performance criterion. The Group accounted for staff costs in 2025 the amount of
EUR 549,000 (2024: EUR 471,000) related to this contribution.
Transactions with the Pension Fund
The balances with the Pension Fund included in items of the consolidated balance sheet are as follows:
(Thousands of euros)
2025
2024
Liabilities
Deposits from customers and other funds
76,718
10,191
Non-subordinated debt securities issued
31,713
10,655
108,431
20,846
In 2025 and 2024 , there were no transactions related to other financial instruments between the Group and the
Pension Fund.
Income and expenses with the Pension Fund included in the items of the consolidated income statement are as
follows:
(Thousands of euros)
2025
2024
Income
Commissions
989
1,049
Expenses
Interest and similar expense
794
229
Amortisations and depreciations
15,461
15,421
16,255
15,650
The balance Amortisations and depreciations corresponds to rents incurred under the scope of the Pension
Fund's properties in which the tenant is the Group.
As at 31\u00a0December 2025, the guarantees granted by the Group to the Pension Fund amount to EUR 5,000
(31\u00a0December 2024: EUR 5,000) and in other revocable commitments amount to EUR 5,000,000 (31\u00a0December
2024: EUR 5,000,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfEmployeeBenefitsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-719": { "value": "Related parties
As defined by IAS 24, the companies detailed in note 60 - List of subsidiary and associates of Banco Comercial
Portugu\u00eas Group, the post-employment benefit plans, the members of the Board of Directors and the key
management members are considered related parties of the Group. The key management members are the first
line Directors. Beyond the members of the Board of Directors and key management members, are also
considered related parties, people who are close to them (family relationships) and entities controlled by them or
in whose management they have significant influence.
As the transactions with subsidiaries are eliminated in consolidation, these are not included in the notes to the
Group's consolidated financial statements.
According to Portuguese law, namely under Article 109 of the Legal Framework of Credit Institutions and Financial
Companies and also in accordance with Article 33 of Notice 3/2020 of the Banco de Portugal, are considered
related parties as well, the qualified shareholders of Banco Comercial Portugu\u00eas, S.A. and the entities controlled by
them or with which they are in a group relationship. The list of the qualified shareholders is detailed in note 41.
A) Balances and transactions with qualified shareholders
The balances reflected in assets of consolidated balance sheet with qualified shareholders, are analysed as follows:
(Thousands of euros)
2025
2024
Assets
Financial assets at amortised cost
Loans and advances to customers
117,029
110,193
Debt securities
99,205
38,996
216,234
149,189
Liabilities
Deposits from customers and other funds
46,617
58,992
Financial liabilities at fair value through profit or loss
Financial liabilities held for trading
\u2014
879
46,617
59,871
The balance Financial assets at amortised cost is net of impairment of EUR 1,147,000 (31\u00a0December 2024: EUR
2,834,000) for Loans and advances to customers and EUR 97,000 (31\u00a0December 2024: EUR 164,000 for Debt
securities).
The transactions with qualified shareholders, reflected in the consolidated income statement items, are as follows:
(Thousands of euros)
2025
2024
Income
Interest and similar income
6,564
9,200
Commissions
1,808
779
8,372
9,979
Expense
Interest and similar expense
120
382
Commissions
286
199
406
581
The balances with qualified shareholders, reflected in the guarantees granted and revocable and irrevocable
credit facilities, are as follows:
(Thousands of euros)
2025
2024
Guarantees granted
3,960
3,771
Revocable credit facilities
17,592
7,801
21,552
11,572
The Group has accounted for provisions for guarantees granted the amount of EUR 3,000 (31\u00a0December 2024: EUR
10,000) and provisions for revocable credit facilities the amount of EUR 12,000 (31\u00a0December 2024: EUR 199,000).
B) Balances and transactions with members of the Board of Directors and key
management members
The balances with related parties discriminated in the following table, included on the consolidated balance sheet,
are analysed as follows:
(Thousands of euros)
Loans and advances to
customers
Deposits from customers
and other funds
2025
2024
2025
2024
Board of Directors
Non-executive directors
3
37
9,075
9,335
Executive Committee (*)
17
9
4,245
2,425
Closely related people
485
494
2,837
2,768
Controlled entities
1
4
1,426
337
Key management personnel
Key management personnel
5,104
4,581
7,519
11,961
Closely related people
3,660
2,356
3,611
4,441
Controlled entities
812
2,881
585
5,456
10,082
10,362
29,298
36,723
(*) The item Loans to Customers corresponds to the amount used from private credit cards which must be settled on the maturity date.
In accordance with Article 85, no. 9 of RGICSF, in 2025 mortgages were granted to Closely related people of Board
of Directors in the amount of EUR 472,000 (31\u00a0December 2024: EUR 479,000) and consumer loans in the amount
of EUR 5,000 in 2024.
The transactions with related parties discriminated in the following table, included in income items of the
consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar income
Commissions income
2025
2024
2025
2024
Board of Directors
Non-executive directors
1
1
20
27
Executive Committee
\u2014
\u2014
11
10
Closely related people
\u2014
1
4
4
Controlled entities
\u2014
\u2014
1
1
Key management personnel
Key management personnel
149
224
17
25
Closely related people
77
78
6
20
Controlled entities
17
76
3
27
244
380
62
114
The transactions with related parties discriminated in the following table, included in cost items of the
consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar expense
Commissions' expense
2025
2024
2025
2024
Board of Directors
Non-executive directors
204
268
\u2014
\u2014
Executive Committee (*)
47
60
\u2014
\u2014
Closely related people
45
73
\u2014
\u2014
Controlled entities
4
1
\u2014
\u2014
Key management personnel
Key management personnel
87
262
\u2014
1
Closely related people
28
62
\u2014
\u2014
Controlled entities
7
62
\u2014
\u2014
422
788
\u2014
1
The revocable credit facilities granted by the Group to the following related parties are as follows:
(Thousands of euros)
Guarantees granted
Revocable credit facilities
2025
2024
2025
2024
Board of Directors
Non-executive directors
\u2014
\u2014
129
119
Executive Committee (*)
\u2014
\u2014
102
110
Closely related people
\u2014
\u2014
87
87
Controlled entities
8
9
5
25
Key management personnel
Key management personnel
4
5
749
745
Closely related people
\u2014
\u2014
191
198
Controlled entities
\u2014
\u2014
17
41
12
14
1,280
1,325
(*) Corresponds to the maximum authorised and unused limit of private credit cards and overdraft authorisation in a salary account under the same
regime as all the Group's other employees.
The shareholder and bondholder position of members of the Board of Directors, Key management members and
people closely related to the previous categories, as well as the movements occurred during 2025, are as follows:
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2025
2024
Acquisitions
Disposals
Date
MEMBERS OF BOARD OF DIRECTORS
Altina de F\u00e1tima Sebasti\u00e1n Gonz\u00e1lez
Villamarin
BCP Shares
0
0
Ana Paula Alcobia Gray
BCP Shares
0
0
Cid\u00e1lia Maria da Mota Lopes
BCP Shares
2,184
2,184
Fernando da Costa Lima
BCP Shares
18,986
18,986
Jo\u00e3o Nuno Oliveira Jorge Palma
BCP Shares
2,410,855
2,117,128
553,679
(a)
259,952
(b)
4/6/2025
0.6810
Jorge Manuel Baptista Magalh\u00e3es Correia
BCP Shares
388,500
388,500
Bonds (i)
2
1
1
30/5/2025
217,446
Bonds (ii)
1
1
Bonds (iv)
2
2
Jos\u00e9 Miguel Bensliman Schorcht da Silva
Pessanha
BCP Shares
2,134,661
1,865,924
506,384
(a)
237,647
(b)
4/6/2025
0.6810
Jos\u00e9 Pedro Rivera Ferreira Malaquias
BCP Shares
78,778
78,778
Lingzi Yuan (Smilla Yuan)
BCP Shares
0
0
Maria Jos\u00e9 Henriques Barreto de Matos de
Campos
BCP Shares
2,554,839
499,515
(a)
99,902
(b)
4/6/2025
0.6810
2,858,212
96,240
24/9/2025
0.7240
Miguel de Campos Pereira de Bragan\u00e7a
BCP Shares
2,842,561
2,533,914
581,801
(a)
273,154
(b)
4/6/2025
0.6810
Miguel Maya Dias Pinheiro
BCP Shares
3,434,160
3,036,111
751,036
(a)
352,987
(b)
4/6/2025
0.6810
Nuno Manuel da Silva Amado
BCP Shares
2,525,388
2,525,388
Bonds (i)
1
1
Bonds (ii)
1
1
Bonds (iii)
1
1
Bonds (iv)
1
1
Rui Manuel da Silva Teixeira
BCP Shares
1,498,863
1,000,000
28/2/2025
0.5400
762,167
496,053
(a)
232,749
(b)
4/6/2025
0.6810
Tao Li Vincent
BCP Shares
0
0
Valter Rui Dias de Barros
BCP Shares
0
0
KEY MANAGEMENT MEMBERS
Albino Ant\u00f3nio Carneiro de Andrade
BCP Shares
64,275
59,078
5,197
(a)
24/4/2025
0.5430
Alexandre Manuel Casimiro de Almeida
BCP Shares
314,188
253,569
60,619
(a)
24/4/2025
0.5430
Am\u00e9rico Jo\u00e3o Pinto Carola
BCP Shares
187,904
62,513
(a)
28,368
(b)
24/4/2025
0.5430
159,145
62,904
14/11/2025
0.8200
Ana Maria Jord\u00e3o F. Torres Marques Tavares
BCP Shares
387,088
320,424
66,664
(a)
24/4/2025
0.5430
Ana Patr\u00edcia Moniz Macedo
BCP Shares
124,036
76,217
47,819
(a)
24/4/2025
0.5430
Ant\u00f3nio Augusto Amaral de Medeiros
BCP Shares
324,724
263,200
61,524
(a)
24/4/2025
0.5430
Ant\u00f3nio Ferreira Pinto J\u00fanior
BCP Shares
11,842
11,842
Ant\u00f3nio Lu\u00eds Duarte Bandeira
BCP Shares
324,345
287,000
68,637
(a)
31,292
(b)
24/4/2025
0.5430
Ant\u00f3nio Ricardo Fery Salgueiro Antunes
BCP Shares
114,793
64,000
5/1/2025
0.4700
108,474
57,681
(a)
24/4/2025
0.5430
Belmira Abreu Cabral
BCP Shares
208,297
175,247
60,478
(a)
27,428
(b)
24/4/2025
0.5430
Bernardo Roquette de Arag\u00e3o de Portugal
Colla\u00e7o
BCP Shares
177,378
140,761
65,834
(a)
29,217
(b)
24/4/2025
0.5430
(i) - Fixed Rate Reset Perpetual Temporary Write Down Additional Tier 1 Capital Notes
(ii) - BCP Tier 2 Subordinated Callable Notes
(iii) - BCP 1.75% EUR 500M 6.5NC5.5 Social Senior Preferred Notes
(iv) - BCP/2023 - BCP Senior Preferred Fixed FLT OCT 2026
(a) - identifies the increment in shares during 2025 corresponding to the annual deferred variable compensation of previous years.
(b) - identifies the shares used in sell-cover in 2025 related to the increment of shares of variable compensation, intended to support the tax charges with the
shares received.
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2025
2024
Acquisitions
Disposals
Date
Chi Wai Leung (Timothy)
BCP Shares
43,768
43,768
Constantino Alves Mousinho
BCP Shares
109,616
7,000
8/4/2025
0.4850
118,062
1,446
(a)
24/4/2025
0.5430
Francisco Ant\u00f3nio Caspa Monteiro
BCP Shares
256,374
218,716
69,187
(a)
31,529
(b)
24/4/2025
0.5430
Gon\u00e7alo Nuno Belo de Almeida Pascoal
BCP Shares
272,865
238,150
61,346
(a)
26,631
(b)
24/4/2025
0.5430
Hugo Miguel Martins Resende
BCP Shares
230,211
69,187
(a)
30,132
(b)
24/4/2025
0.5430
203,739
65,527
11/11/2025
0.8000
Jo\u00e3o Adriano Azevedo Seixas Vale
BCP Shares
43,222
43,222
Jo\u00e3o Br\u00e1s Jorge
BCP Shares
91,709
91,709
Jo\u00e3o Manuel Taveira Pinto Santos Paiva
BCP Shares
421,578
352,982
68,596
(a)
24/4/2025
0.5430
Joaquim Lino Abreu Cavaco
BCP Shares
34,840
34,840
Jorge Filipe Nogueira Freire Cortes Martins
BCP Shares
85,394
61,963
(a)
24/4/2025
0.5430
55,394
31/7/2025
0.7300
61,963
30,000
23/9/2025
0.7380
Jorge Manuel Machado de Sousa G\u00f3is
BCP Shares
272,432
58,648
(a)
24/4/2025
0.5430
140,728
190,352
6/5/2025
0.5870
Jorge Manuel Magalh\u00e3es Oliveira Pereira
BCP Shares
133,763
101,127
59,630
(a)
26,994
(b)
24/4/2025
0.5430
Jorge Manuel Nobre Carreteiro
BCP Shares
162,472
98,000
20/3/2025
0.5500
122,748
58,276
(a)
24/4/2025
0.5430
Jos\u00e9 Carlos Benito Garcia de Oliveira
BCP Shares
0
37,941
37,941
30/7/2025
0.6934
Jos\u00e9 Luis Dores de Almeida
BCP Shares
60,488
60,488
Luis Miguel Manso Correia dos Santos
BCP Shares
417,894
380,277
69,187
(a)
31,570
(b)
24/4/2025
0.5430
Luis Miguel Martinho Antunes Amaro
BCP Shares
28,835
28,835
Lu\u00edsa Maria Videira dos Santos
BCP Shares
25,220
24,420
1,438
(a)
638
(b)
24/4/2025
0.5430
Maria Constan\u00e7a C. Brand\u00e3o Amado Fonseca
G. Santos
BCP Shares
800
800
Maria de Los Angeles Sanchez Sanchez
BCP Shares
62,419
1,044
(a)
24/4/2025
0.5430
3,463
28/8/2025
0.7290
18,000
42,000
9/9/2025
0.7060
Maria Helena Soledade Nunes Henriques
BCP Shares
350,493
316,161
62,868
(a)
28,536
(b)
24/4/2025
0.5430
M\u00e1rio Ant\u00f3nio Pinho Gaspar Neves
BCP Shares
220,165
187,895
58,982
(a)
26,712
(b)
24/4/2025
0.5430
M\u00e1rio George Chaves Afonso
BCP Shares
1,623
1,623
Nelson Lu\u00eds Vieira Teixeira
BCP Shares
130,270
38,000
6/3/2025
0.5420
127,060
63,707
(a)
28,917
(b)
24/4/2025
0.5430
No\u00e9 Beato dos Santos Oliveira
BCP Shares
120,619
120,619
Bonds (v)
1
1
Nuno Alexandre Ferreira Pereira Alves
BCP Shares
277,058
3,750
24/1/2025
0.5162
67,893
(a)
24/4/2025
0.5430
34,000
8/7/2025
0.6730
5,000
29/9/2025
0.7520
295,000
7,201
16/12/2025
0.8740
Nuno Miguel de Ferreira Soares
BCP Shares
85,500
85,500
Nuno Miguel Nobre Botelho
BCP Shares
175,000
126,049
48,951
(a)
24/4/2025
0.5430
Pedro Jos\u00e9 Mora de Paiva Beija
BCP Shares
52,896
69,187
(a)
24/4/2025
0.5430
26,000
1/7/2025
0.6610
69,187
26,896
7/8/2025
0.7450
Pedro Manuel Francisco da Silva Dias
BCP Shares
246,098
68,650
(a)
24/4/2025
0.5430
301,143
13,605
6/8/2025
0.7390
Pedro Manuel Macedo Vilas Boas
BCP Shares
146,869
85,150
61,719
(a)
24/4/2025
0.5430
(v) BCP EUR FIixed Rate Reset Subordinated Notes Sindicada
(a) - identifies the increment in shares during 2025 corresponding to the annual deferred variable compensation of previous years.
(b) - identifies the shares used in sell-cover in 2025 related to the increment of shares of variable compensation, intended to support the tax charges with the
shares received.
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2025
2024
Acquisitions
Disposals
Date
Ricardo Potes Valadares
BCP Shares
135,083
108,405
48,436
(a)
21,758
(b)
24/4/2025
0.5430
Ricardo Jorge da Gra\u00e7a Rodrigues de Almeida
BCP Shares
47,154
13,000
29/5/2025
0.6910
17,077
17/6/2025
0.6830
34,154
17,077
17/6/2025
0.6850
Rosa Maria Ferreira Vaz Santa B\u00e1rbara
BCP Shares
93,866
68,596
(a)
24/4/2025
0.5430
67,110
8/8/2025
0.7530
135,706
93,866
7/5/2025
0.5880
Rui Emanuel Agapito Silva
BCP Shares
228,937
193,172
65,480
(a)
29,715
(b)
24/4/2025
0.5430
Rui Manuel Pereira Pedro
BCP Shares
545,866
483,521
62,345
(a)
24/4/2025
0.5430
Rui Miguel Alves Costa
BCP Shares
511,807
442,620
69,187
(a)
24/4/2025
0.5430
Rui Nelson Moreira de Carvalho Maximino
BCP Shares
183,121
167,569
15,552
(a)
24/4/2025
0.5430
Rui Pedro da Concei\u00e7\u00e3o Coimbra Fernandes
BCP Shares
239,537
172,218
67,319
(a)
24/4/2025
0.5430
V\u00e2nia Alexandra Machado Marques Correia
BCP Shares
300,874
242,226
58,648
(a)
24/4/2025
0.5430
PEOPLE CLOSELY RELATED TO THE PREVIOUS
of: Cid\u00e1lia Maria da Mota Lopes
Alexandre Miguel Martins Ventura
BCP Shares
2,184
2,184
of: Maria Jos\u00e9 Henriques Barreto de Matos de
Campos
Ricardo Gil Monteiro Lopes de Campos
BCP Shares
(c)
(c)
of: Rui Manuel da Silva Teixeira
Maria Helena Espassandim Cat\u00e3o
BCP Shares
576
576
of: Am\u00e9rico Jo\u00e3o Pinto Carola
Ana Isabel Salgueiro Antunes
BCP Shares
29
29
of: Ana Maria Jord\u00e3o F. Torres Marques Tavares
\u00c1lvaro Manuel Coreia Marques Tavares
BCP Shares
25,118
25,118
Francisco Jord\u00e3o Torres Marques Tavares
BCP Shares
1,016
1,016
of: Ant\u00f3nio Lu\u00eds Duarte Bandeira
Ana Margarida Rebelo A. M. Soares Bandeira
BCP Shares
2,976
2,976
of: Francisco Ant\u00f3nio Caspa Monteiro
Ricardo Miranda Monteiro
BCP Shares
1,639
1,639
Rita Miranda Monteiro
BCP Shares
1,639
1,639
of: Jo\u00e3o Manuel Taveira Pinto Santos Paiva
Ana Sofia Bessa Ribeiro
BCP Shares
432
432
of: Maria Helena Soledade Nunes Henriques
Jo\u00e3o Paulo Rodrigues Taborda Gon\u00e7alves
BCP Shares
130
130
of: Maria Manuela de Ara\u00fajo Mesquita Reis
Lu\u00eds Filipe da Silva Reis
BCP Shares
280,000
280,000
of: Jos\u00e9 Pedro Rivera Ferreira Malaquias
Maria Joana de Oliveira Monteiro Ferreira
Malaquias
BCP Shares
(d)
(d)
of: M\u00e1rio George Chaves Afonso
\u00a0 Maria Adelaide Godinho Jer\u00f3nimo Afonso
BCP Shares
6,200
6,200
\u00a0 Maria Godinho Jer\u00f3nimo Chaves Afonso
BCP Shares
3,700
3,700
(a) - identifies the increment in shares during 2025 corresponding to the annual deferred variable compensation of previous years.
(b) - identifies the shares used in sell-cover in 2025 related to the increment of shares of variable compensation, intended to support the tax charges with the
shares received.
(c) - solidary ownership in both securities accounts, with Mr. Ricardo Campos as the first holder and Ms. Maria Jos\u00e9 Campos as the second holder of the securities
account.
(d) - solidary ownership in both securities accounts, with Mr. Jos\u00e9 Pedro Ferreira Malaquias as the first holder and Ms. Maria Joana Ferreira Malaquias as the
second holder of the securities account.
C) Balances and transactions with associates
The balances with associates included in the consolidated balance sheet items, except for the item investments in
associates, are as follows:
(Thousands of euros)
2025
2024
Assets
Loans and advances to credit institutions repayable on demand
5,337
8,328
Financial assets at amortised cost
Loans and advances to credit institutions
220,232
225,644
Loans and advances to customers
59,169
59,454
Other assets
18,461
18,208
303,199
311,634
Liabilities
Financial liabilities at amortised cost
Deposits from credit institutions and other funds
10,822
39,568
Deposits from customers and other funds
118,653
150,317
Non-subordinated debt securities issued
\u2014
3,562
Other liabilities
614
626
130,089
194,073
The transactions with associates included in the consolidated income statement items are as follows:
(Thousands of euros)
2025
2024
Income
Interest and similar income
11,134
14,001
Commissions
75,491
67,481
Gains on financial operations
\u2014
16
Other operating income
3,445
3,776
90,070
85,274
Costs
Interest and similar expense
2,046
1,837
Commissions
3,583
3,893
Other administrative costs
2,321
4,182
Losses on financial operations
\u2014
878
7,950
10,790
The guarantees granted and revocable and irrevocable credit facilities by the Group over associates are as follows:
(Thousands of euros)
2025
2024
Guarantees granted
2,655
2,633
Revocable credit facilities
17,309
17,050
Irrevocable credit facilities
1,354
\u2014
21,318
19,683
Under the scope of the Group's insurance mediation activities, the remuneration from services provided is
analysed as follows:\u00a0
(Thousands of euros)
2025
2024
Life insurance
Saving products
23,731
24,255
Mortgage and consumer loans
44,099
35,590
67,830
59,845
Non-Life insurance
Accidents and health
34,687
28,755
Motor
5,126
4,512
Home Multi-Risk
13,371
10,510
Other
2,296
2,082
55,480
45,859
123,310
105,704
Remuneration from insurance intermediation services was received through bank transfers and resulted from
insurance intermediation with Ocidental - Companhia Portuguesa de Seguros de Vida, S.A. and Ageas Portugal -
Companhia de Seguros, S.A. (Millenniumbcp Ageas Group). The Group does not collect insurance premiums on
behalf of Insurance Companies nor performs any movement of funds related to insurance contracts. Thus, there is
no other asset, liability, income or expense to be reported related to the activity of insurance mediation exercised
by the Group, other than those already disclosed.
The receivable balances from insurance intermediation activities, by nature, are analysed as follows:
(Thousands of euros)
2025
2024
Funds receivable for payment of life insurance commissions
16,941
16,310
Funds receivable for payment of non-life insurance commissions
14,500
12,552
31,441
28,862
The commissions received result from insurance mediation contracts and investment contracts, under the terms
established in the contracts in force. The mediation commissions are calculated according to the nature of the
contracts subject to mediation, as follows:
- insurance contracts \u2013 use of fixed rates on gross premiums issued;
- investment contracts \u2013 use of fixed rates on the responsibilities assumed by the insurance company under the
commercialisation of these products.
D) Transactions with the Pension Fund
The balances with the Pension Fund included in items of the consolidated balance sheet are as follows:
(Thousands of euros)
2025
2024
Liabilities
Deposits from customers and other funds
76,718
10,191
Non-subordinated debt securities issued
31,713
10,655
108,431
20,846
In 2025 and 2024 , there were no transactions related to other financial instruments between the Group and the
Pension Fund.
Income and expenses with the Pension Fund included in the items of the consolidated income statement are as
follows:
(Thousands of euros)
2025
2024
Income
Commissions
989
1,049
Expenses
Interest and similar expense
794
229
Amortisations and depreciations
15,461
15,421
16,255
15,650
The balance Amortisations and depreciations corresponds to rents incurred under the scope of the Pension
Fund's properties in which the tenant is the Group.
As at 31\u00a0December 2025, the guarantees granted by the Group to the Pension Fund amount to EUR 5,000
(31\u00a0December 2024: EUR 5,000) and in other revocable commitments amount to EUR 5,000,000 (31\u00a0December
2024: EUR 5,000,000).
", "dimensions": { "concept": "ifrs-full:DisclosureOfRelatedPartyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-720": { "value": "
As the transactions with subsidiaries are eliminated in consolidation, these are not included in the notes to the
Group's consolidated financial statements.
According to Portuguese law, namely under Article 109 of the Legal Framework of Credit Institutions and Financial
Companies and also in accordance with Article 33 of Notice 3/2020 of the Banco de Portugal, are considered
related parties as well, the qualified shareholders of Banco Comercial Portugu\u00eas, S.A. and the entities controlled by
them or with which they are in a group relationship. The list of the qualified shareholders is detailed in note 41.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithRelatedPartiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-721": { "value": "
Under the scope of the Group's insurance mediation activities, the remuneration from services provided is
analysed as follows:\u00a0
(Thousands of euros)
2025
2024
Life insurance
Saving products
23,731
24,255
Mortgage and consumer loans
44,099
35,590
67,830
59,845
Non-Life insurance
Accidents and health
34,687
28,755
Motor
5,126
4,512
Home Multi-Risk
13,371
10,510
Other
2,296
2,082
55,480
45,859
123,310
105,704
The receivable balances from insurance intermediation activities, by nature, are analysed as follows:
(Thousands of euros)
2025
2024
Funds receivable for payment of life insurance commissions
16,941
16,310
Funds receivable for payment of non-life insurance commissions
14,500
12,552
31,441
28,862
", "dimensions": { "concept": "ifrs-full:DisclosureOfInsuranceContractsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-722": { "value": "
The segments presented are in accordance with IFRS 8. In accordance with the Group's management model, the
segments presented correspond to the segments used for management purposes by the Executive Committee.
The Group offers a wide range of banking activities and financial services in Portugal and abroad, with a special
focus on Commercial Banking, Companies Banking and Private Banking.
Segments description
The Group operates in the Portuguese market and also in a few affinity markets with recognised growth potential.
Considering this, the geographical segments are structured in Portugal and International Business (Poland,
Mozambique and Other). Portugal segment reflects, essentially, the activities carried out by Banco Comercial
Portugu\u00eas in Portugal and ActivoBank.
Portugal activity includes the following segments: i) Retail Banking; ii) Companies and Corporate; iii) Private
Banking and iv) Other.
Retail Banking includes the following business areas:
- Retail network, which serves individual customers, entrepreneurs, merchants and small and medium enterprises
with a turnover less than EUR 2.5 million. The Retail network strategic approach is to target \u201cMass Market\u201d
customers, who appreciate a value proposal based on innovation and speed, as well as Prestige and Small
Business customers, whose specific characteristics, financial assets or income imply a value proposal based on
innovation and personalization, requiring a dedicated Account Manager;
- Retail Recovery Division that manages customers or economic groups in effective default, as well as customers
who have filed for bankruptcy or other similar mechanisms, aiming to minimize losses through agreements or
payment restructuring processes; and
- ActivoBank, a bank focused on mainly young customers, who are intensive users of new communication
technologies and who prefer a banking relationship based on simplicity, offering modern products and services.
Companies and Corporate segment includes:
- Companies and Corporate network, which serves customers included in the corporate segment, economic
groups and institutional entities, with a turnover higher than EUR 2.5 million, offering a wide range of traditional
banking products complemented by specialised financing;
- Large Corporate network that assures the relationship and the monitoring of a set of Groups / Customers, which
in addition to Portugal, develop their activity in several geographies (Poland, Angola, Mozambique and East),
providing a complete range of value-added products and services;
- Specialised Recovery Division which ensures efficient tracking of customers with predictable or effective high
risk of credit, from Companies, Corporate, Large Corporate and retail networks (exposure exceeding EUR 1 million),
in order to defend the value and manage credit risk;
- Investment Banking unit, that ensures the offer of products and specific services, in particular financial advice,
including corporate finance services, capital market transactions and analysis and financing structuring in the
medium to long-term;
- Interfundos with the activity of management of real estate investment funds;
- Specialised Credit and Real Estate Department, with the mission of managing the Group's foreclosed assets
portfolio, referred as non-performing assets, in order to place them back to the market;
- Treasury, Markets and International Department, which coordinates business with banks and financial
institutions in order to better serve the Group's commercial networks and operations abroad. This unit has a
dynamic emphasis that promotes international business within commercial networks, aiming to be a partner for
customers for internationalization. It also provides securities custody services to resident and non-resident
customers, and grants the Group's intervention in the financial markets, providing commercial services for
treasury and markets products and managing the financial risks inherent to the Group's activity.
The Private Banking segment comprises:
- Private Banking Division in Portugal, focused on high-net-worth individuals, based on a commitment to
excellence and a personalised relationship with customers;
- Wealth Management Division, which provides advisory customer services and portfolio management for
customers in the Private Banking network and the affluent segment.
All other businesses not previously discriminated are allocated to the Other segment (Portugal) and include
centralised management of financial investments, corporate activities and operations not integrated in the
remaining business segments and other amounts not allocated to segments.
International Business includes the following segments:
- Poland, where the Group is represented by Bank Millennium, a universal bank offering a wide range of financial
products and services to individuals and companies nationwide. Polish activity is segmented as follow:
\u2013 Retail Banking, which includes services aimed at mass-market customers, affluent customers and
individual entrepreneurs, through a comprehensive offer of banking products and services, as well as the
distribution of specialised products provided by the Group\u2019s subsidiaries;
\u2013 Companies and Corporate, focused on serving companies of all sizes, including public sector entities, with
a high-quality suite of tailored banking solutions, complemented by cash management services, treasury
products (including derivatives), and leasing and factoring offerings; and
\u2013 Other covering the Group\u2019s activities such as treasury management, brokerage operations, positions in
debt securities and other items not allocated to specific segments, as well as the impacts of FX mortgage
portfolio;
- Mozambique, where the Group is represented by BIM \u2013 Banco Internacional de Mo\u00e7ambique, a universal bank
targeting companies and individual customers; and
- Other, which includes the contribution of the associate in Angola.
Business segments activity
The figures reported for each segment resulted from aggregating the subsidiaries and business units integrated
in each segment. For the business units in Portugal, the aggregation process reflects the impact from capital
allocation and balancing process in the balance sheet and income statement, based on average figures. The
balance sheet headings for each business unit in Portugal were calculated considering the allocation process,
based on the regulatory solvency criteria.
Considering that the process of capital allocation complies with the regulatory criteria of solvency in force, from 1
January 2025, the risk weighted assets, and consequently the capital allocated to the business segments, are
determined in accordance with the Basel IV framework, pursuant to the CRD VI/CRR3 (in 2024, they are
determined in accordance with the Basel III framework, pursuant to the CRD V/CRR2). The capital allocated to
each segment resulted from the application of a target capital ratio to the risk weighted exposures managed by
each segment, reflecting the application of the Basel IV methodology in 2025 (Basel III in 2024). The introduction
of CRR3 led to a significant increase in risk weighted assets to cover operational risk. Each operation is balanced
through internal transfers of funds, with impact on the net interest income and income taxes of each segment,
but with no impact on consolidated accounts.
Commissions and other net income, as well as operating costs calculated for each business area, are based on the
amounts accounted for directly in the respective cost centres, on the one hand, and the amounts resulting from
internal processes for allocating revenues and costs, for another. In this case, the allocation is based on the
application of pre-defined criteria and subject to periodic review, related to the level of activity of each business
area.
The following information has been prepared based on the individual and consolidated financial statements of the
Group prepared in accordance with international financial reporting standards (IFRS), as adopted by the European
Union (EU), at the reference date and with the Organization of the Group's business areas in force on 31 December
2025. Information relating to prior periods is restated whenever changes occur in the internal organisation of the
Group that affect the composition of the reportable segments or relevant changes in the criteria for allocation of
indirect revenues and costs, as described in the previous paragraph, ensuring the comparability of the information
provided across the reported periods.
The information in the financial statements of reportable segments is reconciled, at the level of the total revenue
for those segments, with the revenue presented in the consolidated financial position statement of the reporting
entity for each reporting date on which is lodged a statement of financial position. Whenever applicable, historical
figures may reflect specific restatements carried out to ensure the comparability of information across periods.
As at 31\u00a0December 2025, the net contribution of the main geographical areas, for the income statement, is
analysed as follows:
(Thousands of euros)
2025
International
Portugal
Poland
Mozambique
Others (*)
Consolidated
INCOME STATEMENT
Net interest income
1,338,250
1,349,418
210,391
\u2014
2,898,059
Net fees and commissions income
625,973
182,963
38,440
\u2014
847,376
Other net income
8,189
(108,161)
1,154
\u2014
(98,818)
Gains/(losses) on financial operations (1)
6,914
82,192
16,450
\u2014
105,556
Dividends from equity instruments
\u2014
803
\u2014
\u2014
803
Share of profit of associates under the equity
method
55,782
\u2014
1,551
4,850
62,183
Net operating income
2,035,108
1,507,215
267,986
4,850
3,815,159
Operating expenses
718,937
560,544
135,607
\u2014
1,415,088
Results on modification (2)
\u2014
(5,320)
\u2014
\u2014
(5,320)
Impairment for credit and financial assets (3)
(142,098)
(39,681)
(89,004)
\u2014
(270,783)
Other impairment and provisions (4)
(20,617)
(519,295)
(14,648)
\u2014
(554,560)
Net income before income tax
1,153,456
382,375
28,727
4,850
1,569,408
Income tax
(284,668)
(98,671)
(25,341)
\u2014
(408,680)
Net income for the period
868,788
283,704
3,386
4,850
1,160,728
Non-controlling interests
615
(141,568)
(1,128)
\u2014
(142,081)
Net income for the period attributable to Bank's
Shareholders
869,403
142,136
2,258
4,850
1,018,647
(*) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
(1) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations and results arising from derecognition of financial assets and liabilities not measured at fair value through profit or loss.
(2) Includes the results of contractual amendments, namely, costs arising from negotiations with customers holding mortgages in foreign currency.
(3) Includes impairment of financial assets at amortised cost, for loans to customers (net of recoveries - principal and accrual) and for debt
instruments related to credit operations. It also includes impairment of financial assets at amortised cost not associated with credit operations.
(4) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions, highlighting
the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
The detail of the net contribution from the activity in Portugal and the activity in Poland, by business areas, to the
income statement, is analysed in the following table. Net contribution from the activity in Mozambique, which
mostly comprises retail banking, is presented henceforth in this note only on an aggregated basis (as presented in
the previous table), given its relative weight in the consolidated activity of the Group.
(Thousands of euros)
2025
Portugal
Poland
Retail
banking
Companies
and
Corporate
Private
banking
Other
Total
Portugal
Retail
banking
Companies
and
Corporate
Other
Total
Poland
INCOME STATEMENT
Net interest income
1,090,597
263,665
40,232
(56,244)
1,338,250
1,075,847
190,958
82,613
1,349,418
Net fees and commissions
income
507,985
145,683
42,678
(70,373)
625,973
133,442
48,309
1,212
182,963
Other net income
11,001
11,128
(116)
(13,824)
8,189
10,290
1,738
(120,189)
(108,161)
Gains/(losses) on financial
operations (1)
1,109
1,902
120
3,783
6,914
24,085
25,350
32,757
82,192
Dividends from equity
instruments
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
803
803
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
55,782
55,782
\u2014
\u2014
\u2014
\u2014
Net operating income
1,610,692
422,378
82,914
(80,876)
2,035,108
1,243,664
266,355
(2,804)
1,507,215
Operating expenses
326,033
69,425
15,403
308,076
718,937
431,945
95,388
33,211
560,544
Results on modification (2)
\u2014
\u2014
\u2014
\u2014
\u2014
(9)
(737)
(4,574)
(5,320)
Impairment for credit and
financial assets (3)
(93,750)
(30,443)
(938)
(16,967)
(142,098)
(25,426)
(29,953)
15,698
(39,681)
Other impairment and
provisions (4)
\u2014
\u2014
\u2014
(20,617)
(20,617)
\u2014
\u2014
(519,295)
(519,295)
Net income before
income tax
1,190,909
322,510
66,573
(426,536)
1,153,456
786,284
140,277
(544,186)
382,375
Income tax
(360,846)
(97,720)
(20,172)
194,070
(284,668)
(149,394)
(26,653)
77,376
(98,671)
Net income for the period
830,063
224,790
46,401
(232,466)
868,788
636,890
113,624
(466,810)
283,704
Non-controlling interests
\u2014
\u2014
\u2014
615
615
\u2014
\u2014
(141,568)
(141,568)
Net income for the period
attributable to Bank's
Shareholders
830,063
224,790
46,401
(231,851)
869,403
636,890
113,624
(608,378)
142,136
(1) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations and results arising from derecognition of financial assets and liabilities not measured at fair value through profit or loss.
(2) Includes the results of contractual amendments, namely, costs arising from negotiations with customers holding mortgage loans in foreign
currency.
(3) Includes impairment of financial assets at amortised cost, for loans to customers (net of recoveries - principal and accrual) and for debt
instruments related to credit operations. It also includes impairment of financial assets at amortised cost not associated with credit operations.
(4) Includes impairment of non current assets held for sale, investments in associated companies, goodwill, other assets and provisions, highlighting
the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31\u00a0December 2025, the net contribution of the main geographical areas, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2025
International
Portugal
Poland
Mozambique
Other (*)
Consolidated
BALANCE SHEET
Cash and Loans and advances to credit institutions
2,746,567
1,116,480
1,273,749
\u2014
5,136,796
Loans and advances to customers (1)
42,453,337
18,130,171
656,607
\u2014
61,240,115
Financial assets (2)
20,855,233
16,785,453
559,872
(103)
38,200,455
Other assets
3,592,739
917,174
199,405
46,243
4,755,561
Total Assets
69,647,876
36,949,278
2,689,633
46,140
109,332,927
Deposits from other credit institutions (3)
849,334
24,909
4,328
\u2014
878,571
Deposits from customers (4)
56,628,892
30,975,992
2,143,945
\u2014
89,748,829
Debt securities issued (5)
3,622,540
1,809,419
\u2014
\u2014
5,431,959
Other financial liabilities (6)
1,089,719
517,396
\u2014
\u2014
1,607,115
Other liabilities (7)
1,077,424
1,460,527
67,745
\u2014
2,605,696
Total Liabilities
63,267,909
34,788,243
2,216,018
\u2014
100,272,170
Total Equity
6,379,967
2,161,035
473,615
46,140
9,060,757
Total Liabilities and Equity
69,647,876
36,949,278
2,689,633
46,140
109,332,927
Number of employees
6,046
7,023
2,678
0
15,747
(*) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
(1) Includes loans and advances to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
(2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through profit
or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income and hedging derivatives.
(3) Includes deposits and other financing from central banks and deposits from other credit institutions.
(4) Corresponds to deposits and other funds from customers (including deposits from customers at amortised cost and customer deposits at fair
value through profit or loss).
(5) Includes non-subordinated debt securities at amortised cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
(6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
(7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31\u00a0December 2025, the detail of the net contribution of Portugal activity and Poland activity, by business
areas, for the balance sheet, is analysed as follows:
(Thousands of euros)
2025
Portugal
Poland
Retail
banking
Companies
and
Corporate
Private
banking
Other
Total
Portugal
Retail
banking
Companies
and
Corporate
Other
Total
Poland
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
15,151,964
1,488,578
2,604,520
(16,498,495)
2,746,567
12,003,083
2,936,275
(13,822,878)
1,116,480
Loans and advances
to customers (1)
29,866,650
11,550,101
418,326
618,260
42,453,337
13,674,399
4,252,669
203,103
18,130,171
Financial assets (2)
\u2014
\u2014
\u2014
20,855,233
20,855,233
\u2014
\u2014
16,785,453
16,785,453
Other assets
\u2014
\u2014
\u2014
3,592,739
3,592,739
\u2014
\u2014
917,174
917,174
Total Assets
45,018,614
13,038,679
3,022,846
8,567,737
69,647,876
25,677,482
7,188,944
4,082,852
36,949,278
Deposits from other
credit institutions (3)
193,438
1,381,910
1
(726,015)
849,334
\u2014
\u2014
24,909
24,909
Deposits from
customers (4)
42,647,770
10,300,054
2,586,270
1,094,798
56,628,892
24,235,498
6,740,494
\u2014
30,975,992
Debt securities issued
(5)
1,127,206
2,398
408,762
2,084,174
3,622,540
\u2014
\u2014
1,809,419
1,809,419
Other financial
liabilities (6)
\u2014
\u2014
\u2014
1,089,719
1,089,719
\u2014
\u2014
517,396
517,396
Other liabilities (7)
\u2014
\u2014
\u2014
1,077,424
1,077,424
\u2014
\u2014
1,460,527
1,460,527
Total Liabilities
43,968,414
11,684,362
2,995,033
4,620,100
63,267,909
24,235,498
6,740,494
3,812,251
34,788,243
Total Equity
1,050,200
1,354,317
27,813
3,947,637
6,379,967
1,441,984
448,450
270,601
2,161,035
Total Liabilities and
Equity
45,018,614
13,038,679
3,022,846
8,567,737
69,647,876
25,677,482
7,188,944
4,082,852
36,949,278
Number of
employees
3,276
309
97
2,364
6,046
5,672
1,070
281
7,023
(1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations net of
impairment and balance sheet amount of loans to customers at fair value through profit or loss.
(2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through profit
or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income and hedging derivatives.
(3) Includes deposits and other financing from central banks and deposits from other credit institutions.
(4) Corresponds to deposits and other funds from customers (including deposits from customers at amortised cost and customer deposits at fair
value through profit or loss).
(5) Includes non-subordinated debt securities at amortised cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
(6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
(7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2024, the net contribution of the main geographical areas, for the income statement, is
analysed as follows:
(Thousands of euros)
2024
International
Portugal
Poland
Mozambique
Other (*)
Consolidated
INCOME STATEMENT
Net interest income
1,335,262
1,291,798
203,793
\u2014
2,830,853
Net fees and commissions income
592,502
180,426
39,775
\u2014
812,703
Other net income
(30,069)
(106,263)
1,417
\u2014
(134,915)
Gains/(losses) on financial operations (1)
9,135
(19,898)
15,745
\u2014
4,982
Dividends from equity instruments
174
842
\u2014
\u2014
1,016
Share of profit of associates under the equity
method
53,422
\u2014
1,547
3,919
58,888
Net operating income
1,960,426
1,346,905
262,277
3,919
3,573,527
Operating expenses
671,935
502,501
131,685
\u2014
1,306,121
Results on modification (2)
\u2014
(68,516)
\u2014
\u2014
(68,516)
Impairment for credit and financial assets (3)
(128,159)
(60,379)
(36,982)
\u2014
(225,520)
Other impairment and provisions (4)
(105,711)
(512,242)
(14,005)
\u2014
(631,958)
Net income before income tax
1,054,621
203,267
79,605
3,919
1,341,412
Income tax
(273,597)
(36,196)
(31,458)
\u2014
(341,251)
Net income after income tax
from continuing operations
781,024
167,071
48,147
3,919
1,000,161
Income arising from discontinued operations
\u2014
\u2014
322
\u2014
322
Net income for the period
781,024
167,071
48,469
3,919
1,000,483
Non-controlling interests
5,411
(83,369)
(16,147)
\u2014
(94,105)
Net income for the period attributable to
Bank's Shareholders
786,435
83,702
32,322
3,919
906,378
(*) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
(1) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations and results arising from derecognition of financial assets and liabilities not measured at fair value through profit or loss.
(2) Results mainly from the amount associated to costs arising from the moratorium program in Poland (credit holidays). It's also includes the results
of contractual amendments, namely, costs arising from negotiations with customers holding mortgage loans in foreign currency.
(3) Includes impairment of financial assets at amortised cost, for loans to customers (net of recoveries - principal and accrual) and for debt
instruments related to credit operations. It also includes impairment of financial assets at amortised cost not associated with credit operations.
(4) Includes impairment of non current assets held for sale, investments in associated companies, goodwill, other assets and provisions, highlighting
the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2024, the detail of the net contribution of Portugal activity and Poland activity, by business
areas, for the income statement, is analysed as follows:
(Thousands of euros)
2024
Portugal
Poland
Retail
banking
Companies
and
Corporate
Private
banking
Other
Total
Portugal
Retail
banking
Companies
and
Corporate
Other
Total
Poland
INCOME STATEMENT
Net interest income
1,153,467
275,762
47,652
(141,619)
1,335,262
1,138,823
175,836
(22,861)
1,291,798
Net fees and commissions
income
465,578
149,415
36,010
(58,501)
592,502
138,438
39,880
2,108
180,426
Other net income
13,482
10,943
249
(54,743)
(30,069)
(1,982)
702
(104,983)
(106,263)
Gains/(losses) on financial
operations (1)
2,588
1,912
88
4,547
9,135
31,555
20,145
(71,598)
(19,898)
Dividends from equity
instruments
\u2014
\u2014
\u2014
174
174
\u2014
\u2014
842
842
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
53,422
53,422
\u2014
\u2014
\u2014
\u2014
Net operating income
1,635,115
438,032
83,999
(196,720)
1,960,426
1,306,834
236,563
(196,492)
1,346,905
Operating expenses
327,877
62,581
15,424
266,053
671,935
386,779
75,105
40,617
502,501
Results on modification (2)
\u2014
\u2014
\u2014
\u2014
\u2014
(33,872)
210
(34,854)
(68,516)
Impairment for credit and
financial assets (3)
(75,353)
(99,490)
(65)
46,749
(128,159)
(53,430)
(23,341)
16,392
(60,379)
Other impairment and
provisions (4)
\u2014
\u2014
\u2014
(105,711)
(105,711)
\u2014
\u2014
(512,242)
(512,242)
Net income before
income tax
1,231,885
275,961
68,510
(521,735)
1,054,621
832,753
138,327
(767,813)
203,267
Income tax
(385,580)
(86,375)
(21,444)
219,802
(273,597)
(158,223)
(26,282)
148,309
(36,196)
Net income for the period
846,305
189,586
47,066
(301,933)
781,024
674,530
112,045
(619,504)
167,071
Non-controlling interests
\u2014
\u2014
\u2014
5,411
5,411
\u2014
\u2014
(83,369)
(83,369)
Net income for the period
attributable to Bank's
Shareholders
846,305
189,586
47,066
(296,522)
786,435
674,530
112,045
(702,873)
83,702
(1) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations and results arising from derecognition of financial assets and liabilities not measured at fair value through profit or loss.
(2) Results mainly from the amount associated to costs arising from the moratorium program in Poland (credit holidays). It's also includes the results
of contractual amendments, namely, costs arising from negotiations with customers holding mortgage loans in foreign currency.
(3) Includes impairment of financial assets at amortised cost, for loans to customers (net of recoveries - principal and accrual) and for debt
instruments related to credit operations. It also includes impairment of financial assets at amortised cost not associated with credit operations.
(4) Includes impairment of non current assets held for sale, investments in associated companies, goodwill, other assets and provisions, highlighting
the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2024, the net contribution of the main geographical areas, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2024
International
Portugal
Poland
Mozambique
Other (*)
Consolidated
BALANCE SHEET
Cash and Loans and advances to credit
institutions
3,756,273
1,359,173
1,522,276
\u2014
6,637,722
Loans and advances to customers (1)
38,633,527
17,531,311
684,977
\u2014
56,849,815
Financial assets (2)
20,055,990
12,822,561
644,740
(55)
33,523,236
Other assets
3,999,132
861,313
225,072
47,312
5,132,829
Total Assets
66,444,922
32,574,358
3,077,065
47,257
102,143,602
Deposits from other credit institutions (3)
584,936
120,296
72,487
\u2014
777,719
Deposits from customers (4)
54,246,569
27,416,885
2,378,084
\u2014
84,041,538
Debt securities issued (5)
3,388,590
1,432,126
\u2014
\u2014
4,820,716
Other financial liabilities (6)
1,120,748
525,187
92
\u2014
1,646,027
Other liabilities (7)
1,313,526
1,262,661
88,858
\u2014
2,665,045
Total Liabilities
60,654,369
30,757,155
2,539,521
\u2014
93,951,045
Total Equity
5,790,553
1,817,203
537,544
47,257
8,192,557
Total Liabilities and Equity
66,444,922
32,574,358
3,077,065
47,257
102,143,602
Number of employees
6,203
6,836
2,625
0
15,664
(*) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
(1) Includes loans and advances to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
(2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through profit
or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income (net of impairment) and
hedging derivatives.
(3) Includes deposits and other financing from central banks and deposits from other credit institutions.
(4) Corresponds to deposits and other funds from customers (including deposits from customers at amortised cost and customer deposits at fair
value through profit or loss).
(5) Includes non-subordinated debt securities at amortised cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
(6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
(7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2024, the detail of the net contribution of Portugal activity and Poland activity, by business
areas, for the balance sheet, is analysed as follows:
(Thousands of euros)
2024
Portugal
Poland
Retail
banking
Companies
and
Corporate
Private
banking
Other
Total
Portugal
Retail
banking
Companies
and
Corporate
Other
Total
Poland
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
14,785,634
1,387,683
2,567,307
(14,984,351)
3,756,273
9,536,064
2,598,098
(10,774,989)
1,359,173
Loans and advances
to customers (1)
26,700,789
11,290,811
362,472
279,455
38,633,527
13,826,512
3,398,737
306,062
17,531,311
Financial assets (2)
\u2014
\u2014
\u2014
20,055,990
20,055,990
\u2014
\u2014
12,822,561
12,822,561
Other assets
\u2014
\u2014
\u2014
3,999,132
3,999,132
\u2014
\u2014
861,313
861,313
Total Assets
41,486,423
12,678,494
2,929,779
9,350,226
66,444,922
23,362,576
5,996,835
3,214,947
32,574,358
Deposits from other
credit institutions (3)
245,109
1,710,080
\u2014
(1,370,253)
584,936
\u2014
\u2014
120,296
120,296
Deposits from
customers (4)
39,283,522
9,573,892
2,620,760
2,768,395
54,246,569
21,803,332
5,613,553
\u2014
27,416,885
Debt securities
issued (5)
1,000,117
6,997
284,892
2,096,584
3,388,590
\u2014
\u2014
1,432,126
1,432,126
Other financial
liabilities (6)
\u2014
\u2014
\u2014
1,120,748
1,120,748
\u2014
\u2014
525,187
525,187
Other liabilities (7)
\u2014
\u2014
\u2014
1,313,526
1,313,526
\u2014
\u2014
1,262,661
1,262,661
Total Liabilities
40,528,748
11,290,969
2,905,652
5,929,000
60,654,369
21,803,332
5,613,553
3,340,270
30,757,155
Total Equity
957,675
1,387,525
24,127
3,421,226
5,790,553
1,559,244
383,282
(125,323)
1,817,203
Total Liabilities and
Equity
41,486,423
12,678,494
2,929,779
9,350,226
66,444,922
23,362,576
5,996,835
3,214,947
32,574,358
Number of
employees
3,369
418
101
2,315
6,203
5,606
908
322
6,836
(1) Includes loans and advances to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
(2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through profit
or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income (net of impairment) and
hedging derivatives.
(3) Includes deposits and other financing from central banks and deposits from other credit institutions.
(4) Corresponds to deposits and other funds from customers (including deposits from customers at amortised cost and customer deposits at fair
value through profit or loss).
(5) Includes non-subordinated debt securities at amortised cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
(6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
(7) Includes provisions, current and deferred tax liabilities and other liabilities.
Reconciliation of net income of reportable segments with the net income attributable
to shareholders
(Thousands of euros)
2025
2024
Net contribution
Retail banking in Portugal
830,063
846,305
Companies and Corporate
224,790
189,586
Private Banking
46,401
47,066
International business (continuing operations)
291,940
219,137
Non-controlling interests (1)
(142,696)
(99,515)
1,250,498
1,202,579
Income arising from discontinued or discontinuing operations
\u2014
322
1,250,498
1,202,901
Amounts not allocated to segments (presented under Other)
Net interest income - bonds portfolio
475,845
512,568
Net interest income - other (2)
(532,089)
(654,187)
Foreign exchange activity
(27,411)
49,353
Gains / (losses) arising from sales of subsidiaries and other assets
25,176
15,950
Equity accounted earnings
55,782
53,422
Impairment and other provisions (3)
(37,584)
(58,962)
Operational costs
(308,076)
(266,054)
Gains on sale of Portuguese public debt
(12,296)
(18,377)
Gains on sale of foreign public debt
355
6,338
Mandatory contributions
(8,953)
(40,005)
Loans sale
7,679
31,269
Income from other financial assets not held for trading mandatorily
at fair value through profit or loss (4)
(4,775)
2,310
Taxes (5)
194,070
219,802
Non-controlling interests
615
5,411
Other (6)
(60,189)
(155,361)
Total not allocated to segments (presented under Other)
(231,851)
(296,523)
Consolidated net income
1,018,647
906,378
(1) Corresponds mainly to the income attributable to third parties related to the subsidiaries in Poland and in Mozambique.
(2) Includes net interest income arising from internal transfer of liquidity, interest rate risk, cost of wholesale funding and others.
(3) Includes impairment for non-current assets held for sale, impairment for other assets, provisions for administrative infractions, various
contingencies and other impairment and/or provisions not allocated to business segments.
(4) Includes gains/(losses) from corporate restructuring funds.
(5) Includes deferred tax revenue/(expenses), net of current non-segment tax expense, namely the tax effect associated with the impacts of the
previous items.
(6) It includes other operations not allocated previously namely funding for non-interest-bearing assets and strategic financial investments.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEntitysReportableSegmentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-723": { "value": "Risk Management
The Group is subject to several risks during the course of its business. The risks from different companies of the
Group are managed centrally, in coordination with the local departments and considering the specific risks of
each business.
The Group's risk-management policy is designed to permanently ensure an adequate relationship between its
own funds and the business it develops, as well as the corresponding evaluation of the risk/return profile by
business line. Under this scope, the monitoring and control of the main types of financial risks (e.g., credit, market,
operational) or non-financial risks (e.g., legal and compliance, reputational) to which the Group\u2019s business is
subject to, including the impact of the geostrategic and ESG risk drivers (environmental, social and governance).
The Bank implemented a regular process for identifying and assessing the risks to which its activity is exposed,
which conclusions are presented to the management bodies and influence the update of the Group\u2019s risk appetite
and risk strategy.
Internal organisation
The Board of Directors of Banco Comercial Portugu\u00eas is responsible for the definition of the risk strategy and
policies, including the approval of the principles and rules of the highest level to be followed in risk management
of the Group, as well as the guidelines dictating the allocation of capital to the business lines.
The Board of Directors, through the Audit Committee and Risk Assessment Committee, ensures the existence of
adequate risk management function and of risk-management systems at Group level and for each entity. The
Board of Directors also approves the risk-tolerance level acceptable to the Group, translated in the risk appetite
statement (RAS), proposed by its Executive Committee, hearing the Risk Assessment Committee.
The Risk Committee is responsible for monitoring the overall levels of risk incurred, ensuring that these are
compatible with the goals and strategies approved for the business. Other commissions regularly monitor specific
risks, namely the Conduct, Compliance and Operational Risks Commission, the Credit and Non-performing Assets
Monitoring Commission, the Pension Funds Risk Monitoring Commission, the Operational Resilience Commission
(with a focus on information technologies and cybernetics) and the Sustainability Commission.
The Chief Risk Officer is responsible for the control of risks in all Group entities, for the identification of all risks to
which the Group activity is exposed and for the proposal of measures to improve risks control. The Chief Risk
Officer also ensures that risks are monitored on an overall basis and that there is alignment of concepts, practices
and goals in risk management. The activity of every entity included within the Banco Comercial Portugu\u00eas
consolidation scope is governed by the principles and decisions established centrally by the Board of Directors
and the main subsidiaries are provided with Risk Office structures which are established in accordance with the
risks inherent to their activity. A Risk Commission has been set up at each relevant subsidiary, responsible for the
control of risks at local level, in which the Risk Officer of BCP takes part.
As Head of the Compliance Office, the Compliance Officer is responsible for ensuring that regulatory requirements
are complied with, as well as the ethical values of the organisation, fulfilling all the attributions that are legally
conferred to it, ensuring the existence of an internal control culture, thus contributing to the mitigation of the risk
of attributing sanctions or significant asset or reputational damages to the Group Entities, including, among
others, compliance with the regulatory framework on the prevention and combating of money laundering and
terrorist financing, fraud, and personal data protection.
Risk assessment
Credit Risk
Credit granting is based on a prior classification of the customers\u2019 risk and on a thorough assessment of the level
of protection provided by the underlying collateral. In order to do so, a single risk-notation system has been
introduced, the Rating Master Scale, based on the expected probability of default, allowing greater discrimination
in the assessment of the customers and better establishment of the hierarchies of the associated risk.
The Rating Master Scale also identifies those customers that show a worsening credit capacity and, in particular,
those classified as being in default. All rating and scoring models used by the Group have been duly calibrated for
the Rating Master Scale. The protection-level concept has been introduced as a crucial element of evaluation of
the effectiveness of the collateral in credit-risk mitigation, leading to a more active collateralisation of loans and to
a better adequacy of pricing regarding the risk incurred.
The gross Group\u2019s exposure to credit risk (original exposure) is presented in the following table:
(Thousands of euros)
Risk items
2025
2024
Central Governments or Central Banks (*)
33,081,155
31,545,676
Regional Governments or Local Authorities
1,619,443
1,304,957
Administrative and non-profit Organisations
6,314,917
4,615,122
Multilateral Development Banks
200,119
290,669
Other Credit Institutions
3,440,851
2,947,599
Retail and Corporate customers
75,949,113
69,428,657
Other items
7,863,835
9,091,787
128,469,433
119,224,467
Note: gross exposures of impairment and amortisation, in accordance with the prudential consolidation scope. Includes securitisation positions.
(*) In 2025 includes DTA's of EUR 1,495,717,787 (31 December 2024: EUR 1,897,830,642).
The evaluation of the risk associated to the loan portfolio and quantification of the respective losses expected
considers the following methodological notes.
a) Collaterals and Guarantees
On the risk evaluation of an operation or of a group of operations, the mitigation elements of credit risk associated
to those operations are considered in accordance with the rules and internal procedures that fulfil the
requirements defined by the regulations in force, also reflecting the experience of the loan's recovery areas and
the Legal Department opinions with respect to the entailment of the various mitigation instruments.
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 108 or better on the Rating Master
Scale;
- personal guarantees when the persons are classified with Risk Grade 108 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organised
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in
restructuring process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk
Grade of the customer by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better
than the customer\u2019s), when the protection is formalised through:
- State, Financial Institutions or Mutual Guarantee Societies guarantees exist;
- Personal guarantees (or, in the case of Leasing, there is a recovery agreement of the provider);
- Credit derivatives;
- Formalisation of the clause of the contracting party in leasing contracts in which it is an entity that is in a
relationship of dominion or group with the lessee.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis
and before decision process.
Either the initial evaluations or the subsequent reviews carried out are performed by external expert valuers and
the ratification process is centralised in the Appraisals Unit, which is independent of the customers\u2019 areas.
In any case, they are the subject to a written report, in a standardised digital format, based on a group of
predefined methods that are aligned with the sector practices \u2013 income, replacement cost and/or market
comparative - mentioning the obtained value, for both the market value and for purposes of the mortgages
guarantee, depending on the type of the real estate. The evaluations have a declaration/certification of an expert
valuer since 2008, as requested by Regulation (EU) 575/2013 and Law 153/2015 of 14 September and are ratified by
the Appraisals Unit.
Regarding residential real estate, after the initial valuation and in accordance with Notice n. 5/2006 of Banco de
Portugal and CRR 575/2013, the Group monitors the respective values through market indexes. If the index is lower
than 0.9, the Group revaluates choosing one of the following two methods:
i) depreciation of the property by direct application of the index, if the amount owed does not exceed EUR
300,000;
ii) review of the property value by external valuators, depending on the value of the credit operation, and in
accordance with the established standards from ECB and Banco de Portugal.
For all non-residential real estate, the Group also monitors its values through market indexes and to the regular
valuation reviews with the minimum periodicities in accordance with the Regulation (EU) 575/2013, in the case of
offices, commercial spaces, warehouses and industrial premises.
For all real estate (residential or non-residential) for which the monitoring result in significant devaluation of the
real estate value (more than 10%), a valuation review is subsequently carried out by an expert valuer, preserving
the referred i) above.
For the remaining real estate (land or countryside buildings for example) there are no market indexes available for
the monitoring of appraisal values, after the initial valuations. Therefore, for these cases and in accordance with
the minimum periodicity established for the monitoring and reviewing of this type of real estate, valuation reviews
are carried out by expert valuers.
The indexes currently used are supplied to the Group by an external specialised entity that, for more than a
decade, has been collecting and processing the data upon which the indexes are built.
In the case of financial collaterals, their market value is daily and automatically updated, through the IT connection
between the collaterals management system and the relevant financial markets data.
b) Risk grades
Credit granting is based on the previous risk assessment of customers and also on a rigorous assessment of the
protection level provided by the underlying collaterals. For this purpose, a single risk grading system is used - the
Rating Master Scale - based on Probability of Default (PD), allowing for a greater discriminating power in
customers' assessment and for a better hierarchy of the associated risk. The Rating Master Scale also allows to
identify customers that show signs of degradation in their credit capacity and, in particular, those that are
classified in a default situation. All rating systems and models used by the Group were calibrated for the Rating
Master Scale.
Aiming at an adequate assessment of credit risk, the Group defined a set of macro segments and segments which
are treated through different rating systems and models that relate the internal risk grades and the customers\u2019
PD, ensuring a risk assessment that considers the customers\u2019 specific features in terms of their respectively risk
profiles.
The assessment made by these rating systems and models result in the risk grades of the Master Scale, that has
eighteen grades, where the last three correspond to relevant downgrades of the customers\u2019 credit quality and are
referred to by \u201cprocedural risk grades\u201d: 123, 124 and 125, that correspond, in this order, to situations of increased
severity in terms default, as risk grade 125 is a Default situation.
The non-procedural risk grades are attributed by the rating systems through automatic decision models or by the
Rating Division \u2013 a unit which is independent from the credit analysis and decision areas and bodies- and are
reviewed/updated periodically or whenever this is justified by events.
The models within the various rating systems are regularly subject to validation, made by the Models Validation
and Monitoring Office, which is independent from the units that are responsible for the development and
maintenance of the rating models.
The conclusions of the validations by the Models Validation and Monitoring Office, as well the respective
recommendations and proposal for changes and/or improvements, are analysed and ratified by a specific
Validation Committee, composed in accordance to the type of model analysed. The proposals for models\u2019 changes
originated by the Validation Committee are submitted to the approval of the Risk Committee.
The following table lists the equivalence between the internal rating levels (Rating Master Scale) and the external
ratings of the international rating agencies:
Internal risk grade (*)
External ratings
Fitch
S&P
Moody's
DBRS
101
AAA
AAA
Aaa
AAA
102
AA+
AA+
Aa1
AA (high)
102
AA
AA
Aa2
AA
103
AA-
AA-
Aa3
AA (low)
103
A+
A+
A1
A (high)
104
A
A
A2
A
105
A-
A-
A3
A (low)
105
BBB+
BBB+
Baa1
BBB (high)
106
BBB
BBB
Baa2
BBB
107
BBB-
BBB-
Baa3
BBB (low)
108
BB+
BB+
Ba1
BB (high)
109
BB
BB
Ba2
BB
111
BB-
BB-
Ba3
BB (low)
112
B+
B+
B1
B (high)
114
B
B
B2
B
115
Lower B
Lower B
Lower B2
Lower B
(*) Customers with GR 110 and GR 113 correspond to BB- and B- from S&P, respectively, or another equivalent.
c) Impairment and Write-offs
The credit impairment calculation as at 31\u00a0December 2025 and 2024 integrates the general principles defined in
International Financial Reporting Standards (IFRS 9) and the guidelines issued by the Banco de Portugal through
Circular Letter CC/2018/00000062, in order to align the calculation process used in the Group with the best
international practices in this area.
As at 31\u00a0December 2025, the financial instruments subject to impairment requirements under IFRS 9, (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2025
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,914
829
\u2014
\u2014
861,743
Loans and advances to customers (note 22)
50,871,677
6,376,942
1,449,026
24,855
58,722,500
Debt instruments (note 23)
24,052,457
605,864
35,879
\u2014
24,694,200
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
1,183
\u2014
16,016,415
Guarantees and other commitments (note 46) (**)
16,256,245
1,682,805
311,324
861
18,251,235
Total
107,973,881
8,749,084
1,797,412
25,716
118,546,093
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
(Thousands of euros)
Category
2025
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
488
10
\u2014
\u2014
498
Loans and advances to customers (note 22)
252,249
296,302
759,614
7,660
1,315,825
Debt instruments (note 23)
28,878
92,651
33,796
\u2014
155,325
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,183
\u2014
1,183
Guarantees and other commitments (note 39)
30,425
23,353
92,378
\u2014
146,156
Total
312,040
412,316
886,971
7,660
1,618,987
(Thousands of euros)
Category
2025
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,426
819
\u2014
\u2014
861,245
Loans and advances to customers (note 22)
50,619,428
6,080,640
689,412
17,195
57,406,675
Debt instruments (note 23)
24,023,579
513,213
2,083
\u2014
24,538,875
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
\u2014
\u2014
16,015,232
Guarantees and other commitments (note 46) (**)
16,225,820
1,659,452
218,946
861
18,105,079
Total
107,661,841
8,336,768
910,441
18,056
116,927,106
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
As at 31\u00a0December 2024, the financial instruments subject to impairment requirements under IFRS 9 (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2024
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,647
\u2014
\u2014
\u2014
797,647
Loans and advances to customers (note 22)
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Debt instruments (note 23)
21,331,504
68,499
4,449
\u2014
21,404,452
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
1,169
\u2014
12,873,806
Guarantees and other commitments (note 46) (**)
15,758,606
1,197,255
322,087
2,790
17,280,738
Total
97,443,191
8,150,841
2,124,346
32,057
107,750,435
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
(Thousands of euros)
Category
2024
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
112
\u2014
\u2014
\u2014
112
Loans and advances to customers (note 22)
240,621
265,341
969,138
11,634
1,486,734
Debt instruments (note 23)
55,407
641
3,233
\u2014
59,281
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,169
\u2014
1,169
Guarantees and other commitments (note 39)
13,831
15,261
88,947
\u2014
118,039
Total
309,971
281,243
1,062,487
11,634
1,665,335
(Thousands of euros)
Category
2024
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,535
\u2014
\u2014
\u2014
797,535
Loans and advances to customers (note 22)
46,442,176
6,619,746
827,503
17,633
53,907,058
Debt instruments (note 23)
21,276,097
67,858
1,216
\u2014
21,345,171
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
\u2014
\u2014
12,872,637
Guarantees and other commitments (note 46) (**)
15,744,775
1,181,994
233,140
2,790
17,162,699
Total
97,133,220
7,869,598
1,061,859
20,423
106,085,100
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as
follows:
(Thousands of euros)
2025
2024
Financial assets held for trading (note 24)
Debt instruments
791,310
1,259,178
Derivatives
168,266
404,252
Financial assets designated at fair value through profit or loss - Debt instruments (note
24)
\u2014
33,894
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
228,652
236,346
Hedging derivatives (note 25)
32,365
69,349
Total
1,220,593
2,003,019
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2025, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,391,263)
2,391,263
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(260,957)
\u2014
260,957
\u2014
\u2014
Transfers from stage 2 to stage 1
2,357,970
(2,357,970)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(356,580)
356,580
\u2014
\u2014
Transfers from stage 3 to stage 1
48,989
\u2014
(48,989)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
176,041
(176,041)
\u2014
\u2014
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
4,434,611
(360,315)
(676,956)
(2,470)
3,394,870
Gross amount at the end of the year
50,871,677
6,376,942
1,449,026
24,855
58,722,500
During 2025, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
240,621
265,341
969,138
11,634
1,486,734
Change in impairment losses:
Transfer to Stage 1
61,397
(51,481)
(9,864)
(52)
\u2014
Transfer to Stage 2
(19,960)
70,779
(50,819)
\u2014
\u2014
Transfer to Stage 3
(4,783)
(35,016)
40,066
(267)
\u2014
Changes occurred due to changes in credit risk
(54,671)
32,959
180,404
332
159,024
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Changes due to new financial assets and
derecognised financial assets and other variations
30,115
14,304
(306,145)
(2,045)
(263,771)
Impairment losses at the end of the year
252,249
296,302
759,614
7,660
1,315,825
During 2024, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
45,651,670
7,290,622
1,914,768
30,749
54,887,809
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,071,117)
2,071,117
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(297,555)
\u2014
297,555
\u2014
\u2014
Transfers from stage 2 to stage 1
1,958,521
(1,958,521)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(420,581)
420,581
\u2014
\u2014
Transfers from stage 3 to stage 1
26,670
\u2014
(26,670)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
128,195
(128,195)
\u2014
\u2014
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Net balance of new financial assets and
derecognised financial assets and other variations
1,417,722
(222,759)
(591,235)
(14)
603,714
Gross amount at the end of the year
46,682,797
6,885,087
1,796,641
29,267
55,393,792
During 2024, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
268,948
291,752
1,007,481
14,469
1,582,650
Change in impairment losses:
Transfer to Stage 1
63,989
(57,318)
(6,549)
(122)
\u2014
Transfer to Stage 2
(13,493)
45,311
(31,818)
\u2014
\u2014
Transfer to Stage 3
(5,250)
(40,730)
46,185
(205)
\u2014
Changes occurred due to changes in credit risk
(98,325)
19,729
240,744
979
163,127
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Changes due to new financial assets and derecognised
financial assets and other variations
27,866
9,583
(196,742)
(2,019)
(161,312)
Impairment losses at the end of the year
240,621
265,341
969,138
11,634
1,486,734
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based
on expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2025
2024
Amortised cost before changes
224,554
235,601
Impairment losses before changes
52,857
31,971
Net amortised cost before changes
277,411
267,572
Net gain/loss arising on changes
(9,097)
(5,338)
Net amortised cost after changes
268,314
262,234
The financial assets changed since the initial recognition at a time when the impairment loss was measured based
on the expected credit losses lifetime, are analysed as follows:
(Thousands of euros)
Financial assets changed
2025
2024
Amortised cost of financial assets for which credit losses expected to go from \"lifetime\" to
12 months
65,180
71,287
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
27,912,683
1,724,254
164,858
63,735
1,952,847
243,962
133,169
377,131
8,151
30,250,812
Individuals-Other
10,293,222
1,112,561
119,694
47,582
1,279,837
179,123
312,892
492,015
8,562
12,073,636
Financial Companies
3,469,121
471,063
1,889
34
472,986
14,565
2,213
16,778
\u2014
3,958,885
Non-financial companies -
Corporate
9,556,611
1,010,324
12,425
1,096
1,023,845
139,011
53,567
192,578
117
10,773,151
Non-financial companies -
SME-Corporate
9,378,672
1,782,468
11,756
12,078
1,806,302
315,449
119,290
434,739
5,900
11,625,613
Non-financial companies -
SME-Retail
7,169,460
1,178,965
94,826
25,340
1,299,131
128,889
117,746
246,635
2,986
8,718,212
Non-financial companies -
Other
3,172,509
33,787
\u2014
\u2014
33,787
31,431
4,922
36,353
\u2014
3,242,649
Other loans
21,089,015
709,238
\u2014
88,467
797,705
\u2014
\u2014
\u2014
\u2014
21,886,720
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Individuals-Mortgages
9,111
16,736
4,302
3,328
24,366
72,363
46,612
118,975
3,575
156,027
Individuals-Other
82,776
66,824
18,745
13,697
99,266
84,033
220,900
304,933
4,085
491,060
Financial Companies
17,774
6,690
92
2
6,784
12,651
1,120
13,771
\u2014
38,329
Non-financial companies -
Corporate
41,456
32,864
414
72
33,350
72,516
25,273
97,789
\u2014
172,595
Non-financial companies -
SME-Corporate
62,270
63,127
746
1,574
65,447
139,954
75,533
215,487
\u2014
343,204
Non-financial companies -
SME-Retail
70,155
58,625
6,371
4,240
69,236
46,642
54,102
100,744
\u2014
240,135
Non-financial companies -
Other
11,301
466
\u2014
\u2014
466
29,384
4,705
34,089
\u2014
45,856
Other loans
17,197
94,751
\u2014
18,650
113,401
\u2014
\u2014
\u2014
\u2014
130,598
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Individuals-Mortgages
27,903,572
1,707,518
160,556
60,407
1,928,481
171,599
86,557
258,156
4,576
30,094,785
Individuals-Other
10,210,446
1,045,737
100,949
33,885
1,180,571
95,090
91,992
187,082
4,477
11,582,576
Financial Companies
3,451,347
464,373
1,797
32
466,202
1,914
1,093
3,007
\u2014
3,920,556
Non-financial companies -
Corporate
9,515,155
977,460
12,011
1,024
990,495
66,495
28,294
94,789
117
10,600,556
Non-financial companies -
SME-Corporate
9,316,402
1,719,341
11,010
10,504
1,740,855
175,495
43,757
219,252
5,900
11,282,409
Non-financial companies -
SME-Retail
7,099,305
1,120,340
88,455
21,100
1,229,895
82,247
63,644
145,891
2,986
8,478,077
Non-financial companies -
Other
3,161,208
33,321
\u2014
\u2014
33,321
2,047
217
2,264
\u2014
3,196,793
Other loans
21,071,818
614,487
\u2014
69,817
684,304
\u2014
\u2014
\u2014
\u2014
21,756,122
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Individuals-Mortgages
0.03%
0.97%
2.61%
5.22%
1.25%
29.66%
35.00%
31.55%
43.86%
0.52%
Individuals-Other
0.80%
6.01%
15.66%
28.79%
7.76%
46.91%
70.60%
61.98%
47.71%
4.07%
Financial Companies
0.51%
1.42%
4.87%
5.88%
1.43%
86.86%
50.61%
82.08%
0.00%
0.97%
Non-financial companies -
Corporate
0.43%
3.25%
3.33%
6.57%
3.26%
52.17%
47.18%
50.78%
0.00%
1.60%
Non-financial companies -
SME-Corporate
0.66%
3.54%
6.35%
13.03%
3.62%
44.37%
63.32%
49.57%
0.00%
2.95%
Non-financial companies -
SME-Retail
0.98%
4.97%
6.72%
16.73%
5.33%
36.19%
45.95%
40.85%
0.00%
2.75%
Non-financial companies -
Other
0.36%
1.38%
0.00%
0.00%
1.38%
93.49%
95.59%
93.77%
0.00%
1.41%
Other loans
0.08%
13.36%
0.00%
21.08%
14.22%
0.00%
0.00%
0.00%
0.00%
0.60%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
25,410,533
2,531,556
198,053
85,589
2,815,198
284,617
162,464
447,081
10,005
28,682,817
Individuals-Other
9,297,921
1,181,727
126,969
52,644
1,361,340
239,235
327,737
566,972
11,793
11,238,026
Financial Companies
3,450,266
40,675
5
17
40,697
13,035
15
13,050
\u2014
3,504,013
Non-financial companies -
Corporate
11,151,305
716,267
6,363
49
722,679
159,996
39,604
199,600
5,226
12,078,810
Non-financial companies -
SME-Corporate
9,034,618
1,762,243
22,710
9,089
1,794,042
499,686
122,876
622,562
1,605
11,452,827
Non-financial companies -
SME-Retail
6,524,804
1,077,758
31,069
21,154
1,129,981
117,188
155,779
272,967
3,428
7,931,180
Non-financial companies -
Other
548,529
21,754
\u2014
\u2014
21,754
\u2014
500
500
\u2014
570,783
Other loans
19,152,578
263,254
335
1,561
265,150
445
\u2014
445
\u2014
19,418,173
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Individuals-Mortgages
11,712
24,030
4,054
3,446
31,530
66,785
57,269
124,054
4,482
171,778
Individuals-Other
61,763
56,698
19,156
12,863
88,717
104,205
228,644
332,849
6,883
490,212
Financial Companies
21,558
2,072
1
2
2,075
12,448
9
12,457
\u2014
36,090
Non-financial companies -
Corporate
41,412
20,142
34
4
20,180
90,639
18,505
109,144
269
171,005
Non-financial companies -
SME-Corporate
41,250
56,922
3,852
2,204
62,978
283,615
56,392
340,007
\u2014
444,235
Non-financial companies -
SME-Retail
79,907
64,710
3,220
3,252
71,182
72,307
70,111
142,418
\u2014
293,507
Non-financial companies -
Other
651
27
\u2014
\u2014
27
\u2014
272
272
\u2014
950
Other loans
51,718
4,260
14
280
4,554
117
\u2014
117
\u2014
56,389
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Individuals-Mortgages
25,398,821
2,507,526
193,999
82,143
2,783,668
217,832
105,195
323,027
5,523
28,511,039
Individuals-Other
9,236,158
1,125,029
107,813
39,781
1,272,623
135,030
99,093
234,123
4,910
10,747,814
Financial Companies
3,428,708
38,603
4
15
38,622
587
6
593
\u2014
3,467,923
Non-financial companies -
Corporate
11,109,893
696,125
6,329
45
702,499
69,357
21,099
90,456
4,957
11,907,805
Non-financial companies -
SME-Corporate
8,993,368
1,705,321
18,858
6,885
1,731,064
216,071
66,484
282,555
1,605
11,008,592
Non-financial companies -
SME-Retail
6,444,897
1,013,048
27,849
17,902
1,058,799
44,881
85,668
130,549
3,428
7,637,673
Non-financial companies -
Other
547,878
21,727
\u2014
\u2014
21,727
\u2014
228
228
\u2014
569,833
Other loans
19,100,860
258,994
321
1,281
260,596
328
\u2014
328
\u2014
19,361,784
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Individuals-Mortgages
0.05%
0.95%
2.05%
4.03%
1.12%
23.46%
35.25%
27.75%
44.80%
0.60%
Individuals-Other
0.66%
4.80%
15.09%
24.43%
6.52%
43.56%
69.76%
58.71%
58.37%
4.36%
Financial Companies
0.62%
5.09%
20.00%
11.76%
5.10%
95.50%
60.00%
95.46%
0.00%
1.03%
Non-financial companies -
Corporate
0.37%
2.81%
0.53%
8.16%
2.79%
56.65%
46.73%
54.68%
5.15%
1.42%
Non-financial companies -
SME-Corporate
0.46%
3.23%
16.96%
24.25%
3.51%
56.76%
45.89%
54.61%
0.00%
3.88%
Non-financial companies -
SME-Retail
1.22%
6.00%
10.36%
15.37%
6.30%
61.70%
45.01%
52.17%
0.00%
3.70%
Non-financial companies -
Other
0.12%
0.12%
0.00%
0.00%
0.12%
0.00%
54.40%
54.40%
0.00%
0.17%
Other loans
0.27%
1.62%
4.18%
17.94%
1.72%
26.29%
0.00%
26.29%
0.00%
0.29%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past
due <=
30 days
Days
past
due >
30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Loans to individuals
38,205,905
2,836,815
284,552
111,317
3,232,684
423,085
446,061
869,146
16,713
42,324,448
Non-financial companies -
Trade
5,761,596
825,034
16,753
7,939
849,726
63,983
60,891
124,874
594
6,736,790
Non-financial companies -
Construction
3,025,258
491,950
13,816
3,764
509,530
226,993
31,456
258,449
640
3,793,877
Non-financial companies -
Manufacturing industries
5,898,525
866,217
17,949
4,764
888,930
137,782
125,158
262,940
4,712
7,055,107
Non-financial companies -
Other activities
2,503,502
308,930
6,024
1,650
316,604
17,510
12,076
29,586
16
2,849,708
Non-financial companies -
Other services
12,088,371
1,513,413
64,465
20,397
1,598,275
168,512
65,944
234,456
3,041
13,924,143
Other Services /Other
activities
24,558,136
1,180,301
1,889
88,501
1,270,691
14,565
2,213
16,778
\u2014
25,845,605
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Loans to individuals
91,887
83,560
23,047
17,025
123,632
156,396
267,512
423,908
7,660
647,087
Non-financial companies -
Trade
32,237
27,470
1,207
1,323
30,000
23,077
26,655
49,732
\u2014
111,969
Non-financial companies -
Construction
16,448
11,203
1,106
690
12,999
80,248
16,689
96,937
\u2014
126,384
Non-financial companies -
Manufacturing industries
44,103
40,034
946
701
41,681
87,029
78,428
165,457
\u2014
251,241
Non-financial companies -
Other activities
12,409
12,921
303
265
13,489
7,860
6,927
14,787
\u2014
40,685
Non-financial companies -
Other services
79,985
63,454
3,969
2,907
70,330
90,282
30,914
121,196
\u2014
271,511
Other Services /Other
activities
34,971
101,441
92
18,652
120,185
12,651
1,120
13,771
\u2014
168,927
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Loans to individuals
38,114,018
2,753,255
261,505
94,292
3,109,052
266,689
178,549
445,238
9,053
41,677,361
Non-financial companies -
Trade
5,729,359
797,564
15,546
6,616
819,726
40,906
34,236
75,142
594
6,624,821
Non-financial companies -
Construction
3,008,810
480,747
12,710
3,074
496,531
146,745
14,767
161,512
640
3,667,493
Non-financial companies -
Manufacturing industries
5,854,422
826,183
17,003
4,063
847,249
50,753
46,730
97,483
4,712
6,803,866
Non-financial companies -
Other activities
2,491,093
296,009
5,721
1,385
303,115
9,650
5,149
14,799
16
2,809,023
Non-financial companies -
Other services
12,008,386
1,449,959
60,496
17,490
1,527,945
78,230
35,030
113,260
3,041
13,652,632
Other Services /Other
activities
24,523,165
1,078,860
1,797
69,849
1,150,506
1,914
1,093
3,007
\u2014
25,676,678
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Loans to individuals
0.24%
2.95%
8.10%
15.29%
3.82%
36.97%
59.97%
48.77%
45.83%
1.53%
Non-financial companies -
Trade
0.56%
3.33%
7.20%
16.66%
3.53%
36.07%
43.77%
39.83%
0.00%
1.66%
Non-financial companies -
Construction
0.54%
2.28%
8.01%
18.33%
2.55%
35.35%
53.06%
37.51%
0.00%
3.33%
Non-financial companies -
Manufacturing industries
0.75%
4.62%
5.27%
14.71%
4.69%
63.16%
62.66%
62.93%
0.00%
3.56%
Non-financial companies -
Other activities
0.50%
4.18%
5.03%
16.06%
4.26%
44.89%
57.36%
49.98%
0.00%
1.43%
Non-financial companies -
Other services
0.66%
4.19%
6.16%
14.25%
4.40%
53.58%
46.88%
51.69%
0.00%
1.95%
Other Services /Other
activities
0.14%
8.59%
4.87%
21.08%
9.46%
86.86%
50.61%
82.08%
0.00%
0.65%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit losses and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
34,708,454
3,713,283
325,022
138,233
4,176,538
523,852
490,201
1,014,053
21,798
39,920,843
Non-financial companies -
Trade
5,416,938
657,638
8,559
7,002
673,199
53,917
61,395
115,312
4,560
6,210,009
Non-financial companies -
Construction
2,670,497
394,218
6,546
4,854
405,618
248,140
36,340
284,480
2,155
3,362,750
Non-financial companies -
Manufacturing industries
5,483,661
794,421
14,995
6,037
815,453
146,620
82,064
228,684
924
6,528,722
Non-financial companies -
Other activities
2,345,455
305,401
3,469
2,144
311,014
23,924
16,458
40,382
104
2,696,955
Non-financial companies -
Other services
11,342,705
1,426,344
26,573
10,255
1,463,172
304,269
122,502
426,771
2,516
13,235,164
Other Services /Other
activities
22,602,844
303,929
340
1,578
305,847
13,480
15
13,495
\u2014
22,922,186
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Loans to individuals
73,475
80,728
23,210
16,309
120,247
170,990
285,913
456,903
11,365
661,990
Non-financial companies -
Trade
32,985
20,550
1,229
1,136
22,915
17,823
25,364
43,187
269
99,356
Non-financial companies -
Construction
12,726
7,819
1,011
1,247
10,077
113,102
18,993
132,095
\u2014
154,898
Non-financial companies -
Manufacturing industries
39,131
44,277
2,740
1,235
48,252
49,740
40,350
90,090
\u2014
177,473
Non-financial companies -
Other activities
8,248
14,122
291
540
14,953
9,519
9,738
19,257
\u2014
42,458
Non-financial companies -
Other services
70,130
55,033
1,835
1,302
58,170
256,377
50,835
307,212
\u2014
435,512
Other Services /Other
activities
73,276
6,332
15
282
6,629
12,565
9
12,574
\u2014
92,479
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Loans to individuals
34,634,979
3,632,555
301,812
121,924
4,056,291
352,862
204,288
557,150
10,433
39,258,853
Non-financial companies -
Trade
5,383,953
637,088
7,330
5,866
650,284
36,094
36,031
72,125
4,291
6,110,653
Non-financial companies -
Construction
2,657,771
386,399
5,535
3,607
395,541
135,038
17,347
152,385
2,155
3,207,852
Non-financial companies -
Manufacturing industries
5,444,530
750,144
12,255
4,802
767,201
96,880
41,714
138,594
924
6,351,249
Non-financial companies -
Other activities
2,337,207
291,279
3,178
1,604
296,061
14,405
6,720
21,125
104
2,654,497
Non-financial companies -
Other services
11,272,575
1,371,311
24,738
8,953
1,405,002
47,892
71,667
119,559
2,516
12,799,652
Other Services /Other
activities
22,529,568
297,597
325
1,296
299,218
915
6
921
\u2014
22,829,707
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Loans to individuals
0.21%
2.17%
7.14%
11.80%
2.88%
32.64%
58.33%
45.06%
52.14%
1.66%
Non-financial companies -
Trade
0.61%
3.12%
14.36%
16.22%
3.40%
33.06%
41.31%
37.45%
5.90%
1.60%
Non-financial companies -
Construction
0.48%
1.98%
15.44%
25.69%
2.48%
45.58%
52.26%
46.43%
0.00%
4.61%
Non-financial companies -
Manufacturing industries
0.71%
5.57%
18.27%
20.46%
5.92%
33.92%
49.17%
39.39%
0.00%
2.72%
Non-financial companies -
Other activities
0.35%
4.62%
8.39%
25.19%
4.81%
39.79%
59.17%
47.69%
0.00%
1.57%
Non-financial companies -
Other services
0.62%
3.86%
6.91%
12.70%
3.98%
84.26%
41.50%
71.99%
0.00%
3.29%
Other Services /Other
activities
0.32%
2.08%
4.41%
17.87%
2.17%
93.21%
60.00%
93.18%
0.00%
0.40%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025 , financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Geography
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Portugal
64,304,554
5,796,075
166,462
77,972
6,040,509
712,242
333,631
1,045,873
16,598
71,407,534
Poland
26,613,257
1,432,010
234,829
67,639
1,734,478
333,419
384,880
718,299
9,118
29,075,152
Mozambique
1,123,482
794,575
4,157
92,721
891,453
6,769
25,288
32,057
\u2014
2,046,992
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment
Portugal
196,675
190,342
8,916
8,956
208,214
315,589
172,412
488,001
\u2014
892,890
Poland
109,034
53,120
21,033
13,097
87,250
138,838
240,733
379,571
7,660
583,515
Mozambique
6,331
96,621
721
19,510
116,852
3,116
15,100
18,216
\u2014
141,399
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Portugal
64,107,879
5,605,733
157,546
69,016
5,832,295
396,653
161,219
557,872
16,598
70,514,644
Poland
26,504,223
1,378,890
213,796
54,542
1,647,228
194,581
144,147
338,728
1,458
28,491,637
Mozambique
1,117,151
697,954
3,436
73,211
774,601
3,653
10,188
13,841
\u2014
1,905,593
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment
coverage
Portugal
0.31%
3.28%
5.36%
11.49%
3.45%
44.31%
51.68%
46.66%
0.00%
1.25%
Poland
0.41%
3.71%
8.96%
19.36%
5.03%
41.64%
62.55%
52.84%
84.01%
2.01%
Mozambique
0.56%
12.16%
17.34%
21.04%
13.11%
46.03%
59.71%
56.82%
0.00%
6.91%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
58,473,777
5,846,367
216,085
102,395
6,164,847
918,541
356,047
1,274,588
13,881
65,927,093
Poland
24,622,516
1,380,971
160,546
61,255
1,602,772
391,388
420,892
812,280
18,176
27,055,744
Mozambique
1,474,261
367,896
8,873
6,453
383,222
4,273
32,036
36,309
\u2014
1,893,792
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment
Portugal
184,443
174,794
11,245
9,943
195,982
473,433
146,705
620,138
\u2014
1,000,563
Poland
86,667
48,884
18,436
10,769
78,089
155,362
266,152
421,514
11,634
597,904
Mozambique
38,861
5,183
650
1,339
7,172
1,321
18,345
19,666
\u2014
65,699
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Portugal
58,289,334
5,671,573
204,840
92,452
5,968,865
445,108
209,342
654,450
13,881
64,926,530
Poland
24,535,849
1,332,087
142,110
50,486
1,524,683
236,026
154,740
390,766
6,542
26,457,840
Mozambique
1,435,400
362,713
8,223
5,114
376,050
2,952
13,691
16,643
\u2014
1,828,093
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment
coverage
Portugal
0.32%
2.99%
5.20%
9.71%
3.18%
51.54%
41.20%
48.65%
0.00%
1.52%
Poland
0.35%
3.54%
11.48%
17.58%
4.87%
39.70%
63.24%
51.89%
64.01%
2.21%
Mozambique
2.64%
1.41%
7.33%
20.75%
1.87%
30.92%
57.26%
54.16%
0.00%
3.47%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2025
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
61,696,215
9,954,383
2,363,743
6,717
1,763,989
75,785,047
281,615
75,503,432
stage 2
1,226,273
2,864,442
2,112,262
335,072
445,587
6,983,636
388,963
6,594,673
stage 3
400
1,559
398
1,462,354
20,194
1,484,905
793,411
691,494
POCI
3,191
2,339
1,865
17,460
1
24,856
7,660
17,196
62,926,079
12,822,723
4,478,268
1,821,603
2,229,771
84,278,444
1,471,649
82,806,795
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
13,388,007
5,017
\u2014
\u2014
2,539,564
15,932,588
\u2014
15,932,588
stage 2
7,702
74,942
\u2014
\u2014
\u2014
82,644
\u2014
15,932,588
stage 3
\u2014
\u2014
\u2014
\u2014
1,183
1,183
1,183
\u2014
13,395,709
79,959
\u2014
\u2014
2,540,747
16,016,415
1,183
16,015,232
Guarantees and other
commitments (**)
stage 1
11,546,206
3,741,469
687,219
755
280,597
16,256,246
30,425
16,225,821
stage 2
485,675
402,580
410,615
17,358
366,576
1,682,804
23,353
1,659,451
stage 3
3
24
84
311,080
133
311,324
92,377
218,947
POCI
52
1
2
806
\u2014
861
\u2014
861
12,031,936
4,144,074
1,097,920
329,999
647,306
18,251,235
146,155
18,105,080
Total
88,353,724
17,046,756
5,576,188
2,151,602
5,417,824
118,546,094
1,618,987
116,927,107
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2024, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2024
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
54,782,294
9,856,040
2,681,861
620
1,491,131
68,811,946
296,140
68,515,806
stage 2
1,781,656
2,210,946
2,208,958
427,453
324,574
6,953,587
265,982
6,687,605
stage 3
193
1,608
737
1,772,838
25,715
1,801,091
972,371
828,720
POCI
2,700
2,384
1,358
22,792
32
29,266
11,634
17,632
56,566,843
12,070,978
4,892,914
2,223,703
1,841,452
77,595,890
1,546,127
76,049,763
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
12,735,540
\u2014
\u2014
\u2014
137,096
12,872,636
\u2014
12,872,636
stage 3
\u2014
\u2014
\u2014
\u2014
1,169
1,169
1,169
\u2014
12,735,540
\u2014
\u2014
\u2014
138,265
12,873,805
1,169
12,872,636
Guarantees and other
commitments (**)
stage 1
11,380,949
3,218,006
785,001
3
374,649
15,758,608
13,831
15,744,777
stage 2
207,462
408,214
393,070
22,586
165,922
1,197,254
15,261
1,181,993
stage 3
3
19
\u2014
321,943
121
322,086
88,947
233,139
POCI
4
2
1
2,783
\u2014
2,790
\u2014
2,790
11,588,418
3,626,241
1,178,072
347,315
540,692
17,280,738
118,039
17,162,699
Total
80,890,801
15,697,219
6,070,986
2,571,018
2,520,409
107,750,433
1,665,335
106,085,098
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
24,013
30,226,799
30,250,812
7,945
148,082
156,027
Individuals - Other
6,596
12,067,040
12,073,636
3,860
487,200
491,060
Financial Companies
13,833
3,945,052
3,958,885
12,986
25,343
38,329
Non-financial companies-Corporate
154,023
10,619,128
10,773,151
89,870
82,725
172,595
Non-financial companies-SME-
Corporate
261,218
11,364,395
11,625,613
162,761
180,443
343,204
Non-financial companies-SME-Retail
31,409
8,686,803
8,718,212
19,874
220,261
240,135
Non-financial companies-Other
36,352
3,206,297
3,242,649
34,090
11,766
45,856
Other loans
\u2014
21,886,720
21,886,720
\u2014
130,598
130,598
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
28,581
28,654,236
28,682,817
9,285
162,493
171,778
Individuals - Other
8,130
11,229,896
11,238,026
4,839
485,373
490,212
Financial Companies
12,658
3,491,355
3,504,013
12,297
23,793
36,090
Non-financial companies-Corporate
184,831
11,893,979
12,078,810
102,207
68,798
171,005
Non-financial companies-SME-
Corporate
409,804
11,043,023
11,452,827
277,360
166,875
444,235
Non-financial companies -SME - Retail
32,522
7,898,658
7,931,180
61,815
231,692
293,507
Non-financial companies-Other
500
570,283
570,783
272
678
950
Other loans
\u2014
19,418,173
19,418,173
\u2014
56,389
56,389
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
30,609
42,293,839
42,324,448
11,805
635,282
647,087
Non-financial companies-Trade
40,995
6,695,795
6,736,790
22,484
89,485
111,969
Non-financial companies-Construction
154,347
3,639,530
3,793,877
70,384
56,000
126,384
Non-financial companies-Manufacturing
industry
155,378
6,899,729
7,055,107
122,836
128,405
251,241
Non-financial companies-Other activities
13,008
2,836,700
2,849,708
7,981
32,704
40,685
Non-financial companies-Other services
119,274
13,804,869
13,924,143
82,910
188,601
271,511
Other Services/Other activities
13,833
25,831,772
25,845,605
12,986
155,941
168,927
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
36,711
39,884,132
39,920,843
14,124
647,866
661,990
Non-financial companies-Trade
31,532
6,178,477
6,210,009
11,538
87,818
99,356
Non-financial companies-Construction
188,453
3,174,297
3,362,750
110,151
44,747
154,898
Non-financial companies-Manufacturing
industry
101,395
6,427,327
6,528,722
44,047
133,426
177,473
Non-financial companies-Other activities
18,033
2,678,922
2,696,955
11,909
30,549
42,458
Non-financial companies-Other services
288,244
12,946,920
13,235,164
264,009
171,503
435,512
Other Services/Other activities
12,658
22,909,528
22,922,186
12,297
80,182
92,479
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
387,544
71,019,990
71,407,534
279,596
613,294
892,890
Poland
127,879
28,947,273
29,075,152
45,469
538,046
583,515
Mozambique
12,021
2,034,971
2,046,992
6,321
135,078
141,399
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
499,966
65,427,127
65,927,093
411,589
588,974
1,000,563
Poland
163,443
26,892,301
27,055,744
49,694
548,210
597,904
Mozambique
13,617
1,880,175
1,893,792
6,792
58,907
65,699
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to
individual analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31\u00a0December 2025, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2025
Year of production
Construction
and Commercial
Real Estate
Companies -
Other Activities
Mortgages
Individuals -
Other
Other
loans
Total
2015 and previous
Number of operations
13,971
32,750
229,682
683,541
421
960,365
Amount (EUR '000)
849,839
3,557,234
7,093,943
1,369,473
239,846
13,110,335
Impairment constituted (EUR '000)
70,756
65,253
84,077
29,715
2,295
252,096
2016
Number of operations
1,576
6,487
8,800
81,234
58
98,155
Amount (EUR '000)
89,734
861,158
411,126
167,116
2,443
1,531,577
Impairment constituted (EUR '000)
1,621
8,371
4,652
8,090
78
22,812
2017
Number of operations
1,885
7,260
14,310
91,995
318
115,768
Amount (EUR '000)
91,755
727,192
788,409
185,226
4,601
1,797,183
Impairment constituted (EUR '000)
4,169
10,994
6,887
10,374
302
32,726
2018
Number of operations
3,289
10,303
19,282
167,005
198
200,077
Amount (EUR '000)
303,634
1,550,329
1,219,319
356,944
170,361
3,600,587
Impairment constituted (EUR '000)
7,212
24,450
9,317
20,830
564
62,373
2019
Number of operations
5,093
12,111
21,941
389,036
177
428,358
Amount (EUR '000)
237,398
1,380,556
1,484,350
671,144
8,735
3,782,183
Impairment constituted (EUR '000)
4,723
24,536
8,693
35,051
287
73,290
2020
Number of operations
5,377
18,124
26,702
145,489
167
195,859
Amount (EUR '000)
309,033
1,375,805
1,843,019
313,927
13,884
3,855,668
Impairment constituted (EUR '000)
12,140
16,869
9,681
23,568
941
63,199
2021
Number of operations
6,109
21,032
38,974
193,999
214
260,328
Amount (EUR '000)
336,007
1,636,125
2,994,728
501,631
158,365
5,626,856
Impairment constituted (EUR '000)
5,249
24,429
11,922
42,987
1,604
86,191
2022
Number of operations
7,038
24,377
28,074
287,516
234
347,239
Amount (EUR '000)
605,074
2,284,241
2,546,466
807,341
20,258
6,263,380
Impairment constituted (EUR '000)
5,901
26,408
7,007
54,936
1,033
95,285
2023
Number of operations
8,584
29,671
25,183
391,892
489
455,819
Amount (EUR '000)
1,033,572
2,537,056
2,463,206
1,063,457
69,089
7,166,380
Impairment constituted (EUR '000)
12,566
38,288
5,104
65,701
569
122,228
2024
Number of operations
10,454
35,689
35,879
543,138
1,691
626,851
Amount (EUR '000)
1,379,732
3,879,212
4,040,851
1,805,476
124,652
11,229,923
Impairment constituted (EUR '000)
13,881
73,252
5,941
78,432
793
172,299
2025
Number of operations
16,372
73,191
38,659
1,416,963
1,305
1,546,490
Amount (EUR '000)
2,584,307
9,782,219
5,520,407
3,949,943
132,075
21,968,951
Impairment constituted (EUR '000)
23,594
243,815
5,524
71,902
2,468
347,303
Total
Number of operations
79,748
270,995
487,486
4,391,808
5,272
5,235,309
Amount (EUR '000)
7,820,085
29,571,127
30,405,824
11,191,678
944,309
79,933,023
Impairment constituted (EUR '000)
161,812
556,665
158,805
441,586
10,934
1,329,802
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
As at 31\u00a0December 2024, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2024
Year of production
Construction
and Commercial
Real Estate
Companies -
Other
Activities
Mortgages
Individuals -
Other
Other
loans
Total
2014 and previous
Number of operations
14,156
29,534
252,970
668,544
730
965,934
Amount (EUR '000)
896,754
3,183,643
7,756,515
1,305,814
254,286
13,397,012
Impairment constituted (EUR '000)
78,530
52,663
100,158
27,346
1,621
260,318
2015
Number of operations
1,581
6,354
8,748
76,703
161
93,547
Amount (EUR '000)
84,592
497,077
407,678
134,673
2,955
1,126,975
Impairment constituted (EUR '000)
1,495
18,949
5,031
7,484
533
33,492
2016
Number of operations
1,807
7,290
9,811
98,126
173
117,207
Amount (EUR '000)
118,163
946,970
468,327
182,369
2,472
1,718,301
Impairment constituted (EUR '000)
1,595
10,080
5,726
12,138
145
29,684
2017
Number of operations
2,191
8,306
16,035
108,278
556
135,366
Amount (EUR '000)
121,934
792,998
903,737
204,274
5,942
2,028,885
Impairment constituted (EUR '000)
4,756
13,468
7,472
14,679
326
40,701
2018
Number of operations
3,880
12,010
21,342
195,982
357
233,571
Amount (EUR '000)
348,049
1,717,047
1,385,196
426,990
291,719
4,169,001
Impairment constituted (EUR '000)
5,185
18,602
9,535
30,198
878
64,398
2019
Number of operations
6,077
15,879
24,524
437,421
312
484,213
Amount (EUR '000)
379,403
1,390,533
1,701,878
816,725
50,025
4,338,564
Impairment constituted (EUR '000)
5,390
38,613
8,242
50,635
851
103,731
2020
Number of operations
7,221
25,512
29,793
205,882
355
268,763
Amount (EUR '000)
557,772
1,983,167
2,115,840
445,438
43,465
5,145,682
Impairment constituted (EUR '000)
12,161
33,067
9,626
32,906
1,620
89,380
2021
Number of operations
8,038
27,455
43,540
254,064
365
333,462
Amount (EUR '000)
554,664
1,927,360
3,439,789
728,043
284,772
6,934,628
Impairment constituted (EUR '000)
8,245
36,582
11,137
58,648
1,782
116,394
2022
Number of operations
8,953
30,755
31,844
394,452
443
466,447
Amount (EUR '000)
1,011,708
3,225,162
2,976,052
1,183,881
48,900
8,445,703
Impairment constituted (EUR '000)
10,394
49,175
5,672
72,621
1,548
139,410
2023
Number of operations
10,212
33,388
29,257
608,249
723
681,829
Amount (EUR '000)
1,480,507
2,773,296
2,970,331
1,716,879
96,858
9,037,871
Impairment constituted (EUR '000)
16,315
40,737
4,197
74,391
933
136,573
2024
Number of operations
14,366
126,180
39,644
1,311,647
2,976
1,494,813
Amount (EUR '000)
2,029,470
6,918,957
4,568,010
3,397,754
298,452
17,212,643
Impairment constituted (EUR '000)
13,463
214,703
6,071
75,276
4,619
314,132
Total
Number of operations
78,482
322,663
507,508
4,359,348
7,151
5,275,152
Amount (EUR '000)
7,583,016
25,356,210
28,693,353
10,542,840
1,379,846
73,555,265
Impairment constituted (EUR '000)
157,529
526,639
172,867
456,322
14,856
1,328,213
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
As at 31\u00a0December 2025, the following table includes the fair value of the collaterals by segments (not limited by
the value of the collateral) associated to the loan's portfolio:
2025
Construction and
Commercial Real Estate
Companies - Other Activities
Mortgages
Fair Value
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,917
10,176
8,226
74,749
414,650
165
Amount (EUR '000)
950,927
247,527
1,337,812
1,940,745
68,904,429
8,251
>= 0.5 M\u20ac and < 1 M\u20ac
Number
967
28
1,470
310
11,134
4
Amount (EUR '000)
677,703
18,302
1,022,382
205,451
7,119,495
2,845
>= 1 M\u20ac and < 5 M\u20ac
Number
857
28
1,162
226
1,638
\u2014
Amount (EUR '000)
1,732,967
58,427
2,273,194
438,883
2,590,652
\u2014
>= 5 M\u20ac and < 10 M\u20ac
Number
113
1
136
22
32
\u2014
Amount (EUR '000)
798,161
9,022
941,111
151,390
210,548
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
71
1
60
7
5
\u2014
Amount (EUR '000)
1,018,316
16,135
833,131
89,073
64,077
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
30
\u2014
44
2
2
\u2014
Amount (EUR '000)
876,246
\u2014
1,373,170
42,941
45,180
\u2014
>= 50 M\u20ac
Number
6
\u2014
15
4
\u2014
\u2014
Amount (EUR '000)
553,001
\u2014
1,266,400
926,307
\u2014
\u2014
Total Number
8,961
10,234
11,113
75,320
427,461
169
Total Amount (EUR '000)
6,607,321
349,413
9,047,200
3,794,790
78,934,381
11,096
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31\u00a0December 2024, the following table includes the fair value of the collaterals by segments (not limited by
the value of the collateral) associated to the loan's portfolio:
2024
Construction and
Commercial Real Estate
Companies - Other Activities
Mortgages
Fair Value
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
7,421
10,402
8,695
72,842
435,269
197
Amount (EUR '000)
971,177
294,041
1,331,150
1,797,700
69,220,142
9,702
>= 0.5 M\u20ac and < 1 M\u20ac
Number
1,038
65
1,303
261
9,252
4
Amount (EUR '000)
716,107
43,049
900,825
174,655
5,923,481
2,532
>= 1 M\u20ac and < 5 M\u20ac
Number
760
57
1,068
192
1,389
\u2014
Amount (EUR '000)
1,603,016
110,727
2,143,924
375,273
2,170,247
\u2014
>= 5 M\u20ac and < 10 M\u20ac
Number
122
2
116
18
23
\u2014
Amount (EUR '000)
860,789
10,213
814,568
134,013
148,552
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
69
1
53
14
3
\u2014
Amount (EUR '000)
961,620
29,640
755,885
187,204
35,893
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
21
\u2014
40
3
2
\u2014
Amount (EUR '000)
609,676
\u2014
1,211,901
63,454
45,216
\u2014
>= 50 M\u20ac
Number
9
\u2014
14
4
\u2014
\u2014
Amount (EUR '000)
724,928
\u2014
1,069,731
879,137
\u2014
\u2014
Total Number
9,440
10,527
11,289
73,334
445,938
201
Total Amount (EUR '000)
6,447,313
487,670
8,227,984
3,611,436
77,543,531
12,234
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31\u00a0December 2025, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgages:
(Thousands of euros)
2025
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,694,782
312,789
53,621
56,044
<60%
27,348
1,619,072
239,394
29,348
22,896
>=60% and <80%
3,575
321,539
69,834
49,104
43,574
>=80% and <100%
1,036
154,519
19,377
3,404
4,666
>=100%
1,113
93,695
18,726
14,336
13,449
Companies - Other Activities
Without associated collateral
n.a.
11,597,146
1,496,792
294,073
453,770
<60%
49,352
2,036,606
427,181
82,466
45,882
>=60% and <80%
15,400
1,001,970
455,418
37,644
30,093
>=80% and <100%
9,328
690,982
110,772
21,601
16,917
>=100%
2,327
519,764
182,305
28,780
36,337
Mortgage loans
Without associated collateral
n.a.
85,965
2,546
6,807
10,999
<60%
369,342
15,555,903
1,034,322
283,388
119,717
>=60% and <80%
98,453
8,471,037
615,595
77,229
26,837
>=80% and <100%
28,582
3,605,064
289,596
31,808
12,817
>=100%
3,140
188,612
21,488
7,194
3,919
As at 31\u00a0December 2024, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgages:
(Thousands of euros)
2024
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,512,159
281,959
68,269
76,485
<60%
25,977
1,519,840
158,693
37,610
23,185
>=60% and <80%
3,506
362,009
51,182
31,307
15,650
>=80% and <100%
1,059
106,345
40,451
2,610
3,460
>=100%
1,135
94,340
21,947
38,149
32,810
Companies - Other Activities
Without associated collateral
n.a.
8,965,096
1,172,453
280,620
431,817
<60%
47,243
1,894,339
487,811
85,539
39,543
>=60% and <80%
14,091
816,960
390,644
49,399
30,333
>=80% and <100%
10,728
692,087
152,910
15,653
16,478
>=100%
2,065
459,238
165,964
183,867
167,306
Mortgage loans
Without associated collateral
n.a.
417,293
7,163
8,637
12,859
<60%
386,507
14,822,521
1,490,909
319,980
129,363
>=60% and <80%
102,038
7,652,552
897,507
104,596
26,597
>=80% and <100%
27,048
2,377,618
387,868
41,008
13,827
>=100%
3,636
134,446
41,043
11,792
6,137
As at 31\u00a0December 2025, the following table includes the fair value and the net book value of the properties
classified as Non-current assets held for sale (note 27) and as Other assets (note 32), by type of asset:
(Thousands of euros)
2025
Assets arising from
recovered loans results
Assets belonging to
investments funds and
real estate companies
Total
Asset
Appraised
value
Book value
Appraised
value (1)
Book value
Appraised
value
Book value
Land
Urban
38,398
17,708
58,729
58,729
97,127
76,437
Rural
1,365
924
2,463
2,463
3,828
3,387
Buildings under construction
Commercials
670
\u2014
\u2014
\u2014
670
\u2014
Mortgages
2,435
\u2014
\u2014
\u2014
2,435
\u2014
Constructed buildings
Commercials
22,455
12,919
\u2014
\u2014
22,455
12,919
Mortgages
19,706
16,562
\u2014
\u2014
19,706
16,562
Other
36,138
35,968
\u2014
\u2014
36,138
35,968
121,167
84,081
61,192
61,192
182,359
145,273
(1) Value deducted from haircuts or other applicable impairment
As at 31\u00a0December 2024, the following table includes the fair value and the net book value of the properties
classified as Non-current assets held for sale (note 27) and as Other assets (note 32), by type of asset:
(Thousands of euros)
2024
Assets arising from
recovered loans
Assets belonging to
investments funds and
real estate companies
Total
Asset
Appraised
value
Book value
Appraised
value (1)
Book value
Appraised
value
Book value
Land
Urban
54,050
25,840
60,855
60,855
114,905
86,695
Rural
1,459
735
2,853
2,853
4,312
3,588
Buildings under construction
Commercials
790
\u2014
\u2014
\u2014
790
\u2014
Mortgages
2,310
\u2014
\u2014
\u2014
2,310
\u2014
Constructed buildings
Commercials
17,380
9,573
\u2014
\u2014
17,380
9,573
Mortgages
38,903
29,227
\u2014
\u2014
38,903
29,227
Other
28,971
28,764
\u2014
\u2014
28,971
28,764
143,863
94,139
63,708
63,708
207,571
157,847
(1) Value deducted from haircuts or other applicable impairment
Credit Portfolio Monitoring Process
The Bank has in place a credit portfolio management and monitoring processes, namely with regard to the
assessment of the risk profile of the exposure in different portfolios/segments. These procedures have the purpose
of identifying and closely monitoring the customers potentially more affected by the prevailing macroeconomic
context, anticipating possible difficulties in complying the responsibilities and defining credit and performance
strategies adjusted to the specificities of each customer/group of customers, with a view to both maintaining
support to customers considered viable and mitigating credit risk in cases where there are risks of loss in the
exposure value.
The importance of this approach is underscored by the uncertainty that has marked activity in recent years, with
the current context highlighting the potential impacts resulting from multiple geopolitical conflicts, instability in
several key European countries, particularly in terms of political uncertainty, more modest economic growth and
budgetary pressures. Added to this context is the imposition of tariffs by the US on imports of goods originating in
the EU, with significant impacts on international trade and geopolitical alliances.
The main guidelines of the credit portfolio monitoring approach can be characterised as presented below:
- Global and transversal: Analysis of the entire credit portfolio of the Group, being excluded from the monitoring
process only customers with a better risk profile (in the case of retail) or with exposures of a lower size (in the case
of retail and corporate).
- Specialised: Monitoring by the Credit Division in coordination with the Rating Division and the Specialised
Recovery Division for the corporate segment and by the Credit Division and Retail Recovery Division for individuals
and small businesses.
- Segmented: Prioritisation of approach/analysis recurrence based on risk signs, in order to gather additional
information and agree on appropriate and sustainable financial restructuring solutions in a timely manner.
- Prospective: Use of predictive models, in order to anticipate potential future defaults, avoiding a reactive
approach.
- Standardised: Both in terms of risk models and monitoring, and in terms of credit solutions for which it is
possible to identify pre-defined alternatives (retail segments).
- Convenient and innovative: Making the restructuring journey simpler and more convenient both in terms of
credit solutions and channels, extending the restructuring offer to the App for consumer credit and mortgages.
Specifically in the corporate segment, the process of portfolio follow-up and monitoring can be generically
characterised as described below, having as a fundamental component the attribution of credit strategies, among
pre-defined options, with review periods differentiated according to the level of risk associated to the strategy
attributed:
1. Customer Assessment and presentation of Indicative Credit Strategy by the Rating Division (for customers with
ratings assigned by corporate rating models);
2. Approval, by the competent credit decision levels, of a credit strategy for each customer, taking into
consideration the Indicative Credit Strategy from the Rating Division, the information received from the area
that follows the customer and the inputs received as a result of the customer interaction process;
3. Decision, negotiation and formalisation of the operations that will ensure that the approved strategy is
pursued and the approved credit limits are met (Credit Division, Areas that follow the client and Operations
Division);
4. Monitoring the Credit Strategy and the evolution of the customer's activity (Credit Division and the Areas that
follow the customer);
5. Monitoring of the credit portfolio and effectiveness of the portfolio monitoring process and credit strategy
attribution (Risk Office), based on a set of KPIs, (e.g. percentage of the credit portfolio with valid risk strategy;
evolution of credit exposure to customers with a reduction strategy; adequacy of the credit strategy to the
customer's performance);
6. In the attribution of the customer's credit strategy, besides the intrinsic factors of the customer, more
transversal factors are taken into consideration, such as the evaluation of the sectorial risk (periodically
reviewed with the support of the Economic Studies Division) and taking into consideration the attribution of a
ESG rating regarding the customers with most relevant exposures;
7. The occurrence of effective and/or potential risk events (signs of default/delinquency; breach of contractual
covenants; severe alteration in sector risk; alteration in the corporate/shareholder structure), trigger an
extraordinary/anticipated revision of the strategy.
As part of this monitoring process and with an impact on other complementary procedures adopted, the Group
defines a list of sectors considered to be more vulnerable to the macroeconomic environment and climate
impacts, which is reviewed periodically (at least annually), supporting a set of reports on the evolution of the risk
profile of the exposures associated with these sectors.
Additional measures with impact on the Impairment level
i. Updating macroeconomic scenarios and the parameters of the collective impairment
model
In view of developments in the economic environment and outlook \u2014 essentially characterised by a progressive
normalisation of inflation levels and interest rates \u2014 an update of the macroeconomic scenarios used in the
collective impairment assessment model in Portugal was carried out in December 2025, based on three scenarios
(Central, Upward and Downward) prepared by the Bank\u2019s Economic Studies Department.
The referred scenarios, which are used in the Group for several purposes other than the impairment calculation,
took into consideration the existing projections of reputed entities.
The tables below systematise the projections for 2025 and 2026 considered for Portugal concerning the central
scenarios with regard to some of the critical variables used in the calculation of collective impairment.
Update of main macroeconomic scenario assumptions (Base Scenario) - Portugal
December 2024 Scenario
December 2025 Scenario
Difference
Variable
2025
2026
2025
2026
2025
2026
3-month Euribor Rate
2.11%
1.87%
2.18%
2.06%
0.07%
0.20%
Employment growth rate
0.77%
0.70%
2.23%
1.14%
1.46%
0.44%
Nominal GDP growth rate
5.49%
4.67%
6.03%
5.41%
0.55%
0.75%
Public consumption growth rate
1.11%
0.83%
1.65%
1.25%
0.53%
0.42%
Regarding Poland, an update of the macroeconomic assumptions was carried out in relation to those considered
in December 2024, which translates into the terms presented in the table below regarding the projections for
2025 and 2026 foreseen in the central scenario.
Update of main macroeconomic scenario assumptions (Base Scenario) - Poland
Variable
December 2024 Scenario
December 2025 Scenario
Difference
2025
2026
2025
2026
2025
2026
Unemployment rate
5.10%
5.20%
5.60%
5.50%
0.50%
-0.30%
Nominal GDP annual evolution
8.50%
6.00%
7.20%
6.70%
-1.30%
0.70%
Consumption annual evolution
3.50%
3.30%
3.90%
3.50%
0.40%
0.20%
Disposable Income
8.50%
6.10%
7.50%
6.50%
-1.00%
0.40%
EUR/PLN exchange rate
4.31
4.32
4.25
4.29
-0.06
-0.03
CHF/PLN exchange rate
4.53
4.41
5.53
5.52
-1.00
1.11
The following tables describe the weightings assigned in Portugal and Poland to the different macroeconomic
scenarios considered at the end of 2024 and 2025, which can be considered as conservative:
Weightings of the macroeconomic scenarios considered
Scenario
Weightings
Portugal
Poland
2024
2025
2024
2025
Central
60%
60%
60%
65%
Upside
10%
10%
10%
10%
Downside
30%
30%
30%
25%
For Portugal, a simulation of an additional one percentage point worsening in the evolution of the key indicators
for the collective impairment estimate was carried out, which translates into the impacts shown in the table
below, based on the collective impairment of the portfolio in Portugal as at 31 December 2025, which amounted to
EUR 489.9 million (this figure does not include the impairment amounts calculated by the overlays methodology
described in point ii. of this section).
Sensitivity analysis on the calculation of collective impairment (December 2025)
Variable
Estimated impact (% variation)
100 bp Employment Growth Rate Aggravation
1,03%
100 bp 3-month Euribor aggravation
3,01%
100 bp Public Consumption Growth Rate aggravation
0,05%
100 bp Nominal GDP Growth Rate Aggravation
0,45%
ii. Impairment overlays
In order to incorporate an additional level of conservatism in the impairment values, the Group defined and
implemented a methodology of complementary of identification of significant increase in credit risk situations
and potential signs of impairment.
This approach adopts differentiated criteria in relation to the base methodologies in force, with distinct processes
having been adopted for the calculation of overlays for the corporate and individual customers segments.
The overlays currently in force seek in particular to address the uncertainty that continues to prevail, associated
with a context of multiple geopolitical conflicts, instability in several relevant European countries, constraints on
economic growth and potential measures affecting international trade.
This positioning is in line with the guidelines on this matter issued by the supervisors in what regards the
identification and measurement of credit risk in contexts of uncertainty, so that the release of overlays initially
constituted in the context of the pandemic should be carried out with prudence and taking into account the
possible need for new overlays to respond to the current context.
The exercise carried out reflected, in terms of impairment value, in the calculation of the estimated impact arising
from potential migrations of customers with higher risk to Stage 2 and Stage 3, based on the various factors
considered in the analysis. It should be noted that the most significant impact occurred in the corporate segment.
The methodology developed by the Group was considered for the calculation and recording of impairment at the
reference date of the accounts, without affecting the classification of credit exposures by stages in the Group's
loan portfolio.
The application of overlay impairment and the respective methodology is approved by the Risk Committee.
In Poland, the Bank also adopted a policy of recording overlays. Taking into consideration the country's specific
reality, adjustments to the overlay's methodology had already been incorporated in 2022 to address the impacts of
the geopolitical crisis.
As a result of the implementation of this methodology, the Bank calculated an additional impairment to that
resulting from the collective analysis model, therefore with characteristics of overlays, whose amount on 31
December 2025 was approximately EUR 114 million in Portugal (EUR 99.1 million in December 2024), EUR 41.84
million in Poland (EUR 43.8 million in December 2024), and EUR 20.5 million in Mozambique (there are no
impairment on overlays in Mozambique December 2024.
As mentioned in note 56, following the downgrade of Mozambique's public debt rating, in 2025 an overlay of EUR
17.1 million was created for loans to the Mozambican State and EUR 3.4 million for consumer loans.
Government measures to mitigate the impacts on mortgage contracts and support in
the access to financing for the purchase of own and permanent housing
Decree-Law 44/2024
With the aim to support the purchase of own permanent houses by young people up to the age of 35, Decree-Law
44/2024, was published by the Portuguese government on July 10, which involves the granting of a partial
personal State guarantee to bank loans granted within this purpose and scope.
As of 31 December 2025, Millennium bcp had contracted 3,641 operations, corresponding to EUR 741.7 million.
Credit concentration risk
The Group\u2019s policy relating to the identification, measurement, and evaluation of the concentration risk in credit
risk is approved by the Bank\u2019s management body, applied to all Group entities, and is based on the following
guidelines:
The monitoring of the concentration risk and the follow-up of major risks is made, at Group level, based on the
concept of \"Economic Groups\" and \u201cCustomers Groups\u201d - sets of connected Customers (individual persons or
companies), which represent a single entity from a credit risk perspective, such that if one of them is affected by
financial problems, one or all of the others, will probably face difficulties to fulfil their debtor obligations.
The Customer connections that originate a Customers\u2019 group include the formal participation on the same
economic group, the evidence that a direct or indirect control relationship exists, including the control by an
individual Customer (criteria of capacity of control) of a company or the existence of a strong commercial
interdependency or common sources of funding that cannot be replaced on a short term (criteria of economic
dependency). The identification of connected costumers is an integral part of the credit granting and monitoring
processes of each Entity, with the Risk Office monitoring the economic and customers\u2019 groups maintenance.
For the control of credit concentration risk and limit the exposure to this risk, there are limits defined for:
1) Exposures to Sovereigns;
2) Exposures to Institutions (Banks/financial institutions);
3) Single-name exposures (Large Corporate exposures);
4) Geographic concentration (country risk);
5) Exposure to sectors of activity.
These limits apply to the \u2018Net exposures\u2019 (*), relating either to a counterparty or a group of counterparties \u2013 cases
for 1), 2) and 3) \u2013 or to the set of exposures to an activity sector or to a country (the counterparty country of
residence) \u2013 cases for 4) and 5).
The metrics regarding the concentration of exposure to Sovereigns and geographic concentration exclude the
countries in which the Group has significant operations (Portugal, Poland, and Mozambique) and the respective
Sovereigns.
Except for exposure to sectors of activity, the concentration limits are established by taking into consideration the
credit worthiness of the debtors at stake in what concerns their rating grades/probability of default (PD) (internal
or external ratings; country rating in the case of geographic concentration).
The concentration limits for corporate single-name exposures apply only to non-NPE positions, since the NPE
(Non-performing exposures) positions are considered \u201calways in excess\u201d and it\u2019s framed by the actions covered by
the NPE reduction Plan defined and executed at Group BCP level.
The limits in force as at 31 December 2025, for the exposure to Single name, in terms of the Net Exposure weight
over the Consolidated Own Funds, are the following:
Risk quality
Master Scale
rating grades
Limit (M\u20ac)
%
Tier 1
101 - 105
572.9
7.0%
Tier 2
106 - 108
368.3
4.5%
Tier 3
109 - 111
211.8
2.6%
Tier 4
112 - 113
41.9
0.5%
Tier 5
114 - 116
19.4
0.2%
(*) Net exposure = EAD x LGD. EAD = Exposure at default ; LGD = Loss given Default.
The limit for exposure to sectors of activity is defined as a maximum of 40% per sector of activity, in terms of the
weight of the Net Exposure for each sector of activity over the Own Funds of each Group Entity.
As at 31 December 2025:
- There were no exposure excesses to Sovereigns, Institutions, Countries or Sectors of activity;
- One Economic Group showed a net exposure above the established Single name limits for their respective risk
grade. For each customer with an exposure excess a specific plan is prepared, aiming at reducing the exposure
and bringing it within the established limits.
It should also be referred that the assessment of the Single-name concentration is also performed within the
Group RAS (Risk Appetite Statement) scope.
The Bank's management body and the Risk Assessment Committee are regularly informed on the evolution of the
credit concentration risk metrics (against the mentioned limits) and on major risks.
The credit concentration risk is measured and monitored by the Risk Office.
The Risk Office maintains a simulation tool for supporting the analysis of the impact on changes on the
Customers\u2019 exposures in the consumption of the respective concentration limits, which is used by the Credit
Division and by the Commercial Networks within the scope of credit analysis for large customers with the purpose
of ensuring that exposures are kept within the approved limits.
Real Estate risk
Real estate risk materialises through losses associated with changes in the value of assets held by the Group or,
indirectly, through funds and/or real estate companies.
The Group detains a real estate portfolio, that comes from repossessed assets linked with recovery processes of
non-performing exposures, that is subject to fluctuations and risks in the real estate market and the obligations
arising from ownership of the properties.
As a credit institution operating in the financial market, the Bank does not operate directly in the real estate
sector, neither as a sales agent nor as an operator in the rental segment.
In this context, the management of this portfolio is based on the following objectives:
\u2022 Minimise the risks associated with the real estate portfolio;
\u2022 Minimise management costs, maintenance and sale of properties;
\u2022 Maximise the financial results from the sale of foreclosed assets;
\u2022 Mitigate the portfolio's impact on the Group's cost of capital and liquidity.
Within this framework, the Group should optimise the outflow of foreclosed assets from the real estate portfolio,
developing appropriate commercial strategies and exploring the distribution channels that are expected to be
most effective at any given time to sell the different types of properties held by the Bank.
By managing this portfolio, the following risks were identified and monitored by the Group:
\u2022 Price risk \u2013 Risk associated with the devaluation of the property due to unfavourable developments in the real
estate market, whether due to a decrease in demand or strong pressure on property sales;
\u2022 Liquidity risk - Inherent to the nature of real estate assets and the impact on the Group's liquidity position and
respective financial costs of holding the property;
\u2022 Operational risk - associated with the processes of acquiring, maintaining and selling properties, which can
result in costs or lost revenue (includes the risks of vandalism and deterioration of properties);
\u2022 Compliance risk - compliance with legal standards from the property acquisition process to the requirements to
be observed in its sale, including the responsibility of being a property owner;
\u2022 Fiscal risk \u2013 associated with possible tax contingencies relating to properties owned by the Group and
monitoring the administrative and judicial proceedings;
\u2022 Reputational risk - related to the risks mentioned above, but also with the image projected by the Group in the
way it manages its operations in the real estate market.
The risks associated above are mitigated by the Group through the existence of a team specialised in the
management of this type of assets; a set of internal policies and standards that regulate the asset management
processes on the balance sheet; and an insurance policy.
The portfolio of real estate assets has been progressively reduced by the Group over the last few years.
Market risk
Market risks represent potential losses arising from changes in interest or exchange rates and/or in the prices of
various financial instruments, considering account not only the correlations among these instruments but also
their respective volatilities.
For profitability analysis and for the quantification, monitoring and control of market risks, the following
management areas are defined for each Group entity:
- Trading: Management of positions aimed at achieving short-term gains through sale or revaluation. These
positions are actively managed, tradable without restrictions, and can be frequently and accurately valued.
These include securities and derivatives resulting from sales activities.
- Funding: Management of institutional funding (wholesale funding) and money market positions.
\u2013 Investment: Management of all positions in securities intended to be held to maturity or for an extended period,
as well as positions not tradable on liquid markets.
- Commercial: Management of positions arising from commercial activities with customers.
- Structural: Management of balance sheet items or operations which, due to their nature, are not directly related
to any of the management areas referred to above.
- ALM: Assets and Liabilities Management.
The definition of these management areas allows for an effective separation between the trading and banking
books, as well as a proper allocation of each transaction to the most appropriate management area, according to
its context and strategy.
To ensure that the risk levels incurred in the Group\u2019s portfolios align with predefined risk tolerance levels, various
market risk limits are established, at least on an annual basis, applicable to all portfolios of the relevant
management areas. These limits are monitored daily (or intra-daily, for financial market areas) by the Risk Office.
Stop-loss limits are also set for portfolios in the financial market areas \u2013 Trading and Funding \u2013 based on multiples
of the defined risk limits. The objective is to cap potential losses in these areas. If these limits are reached, a
mandatory review of the underlying business strategy and assumptions associated with the positions in question
is triggered.
Market risks of the prudential trading book (1)
For the daily measurement of generic market risk, which includes interest rate risk, exchange rate risk, equity risk
and the price risk of credit default swap (indices), the Group uses a Value-at-Risk (VaR) model, with a 10-business-
day time horizon and a 99% confidence level.
Additionally, the Group uses an integrated market risk measure that covers all relevant risk subtypes. This
measure incorporates generic, specific, non-linear and commodity risks. Each sub-type is measured individually
using appropriate risk models, and the integrated measure is calculated without considering any diversification
across the four subtypes (worst-case scenario approach).
For non-linear risk, the Group applies an internally developed methodology that replicates the effect of the main
non-linear elements of option positions on portfolio results, similar to the VaR approach, using the same time
horizon and confidence level.
Specific and commodity risks are measured using standard methodologies defined in applicable regulations, with
an appropriate adjustment of the time horizon.
The following table presents the amounts at risk for the Trading Book, measured using approaches described
above:
(Thousands of euros)
2025
Max of global risk
in the period
Min of global risk
in the period
2024
Generic Risk ( VaR )
503
3,016
485
488
Interest Rate Risk
366
1,811
318
310
FX Risk
232
1,500
255
275
Equity Risk
328
1,510
244
285
Diversification effects
(423)
(1,805)
(332)
(382)
Specific Risk
1
1
1
1
Non-Linear Risk
\u2014
\u2014
\u2014
\u2014
Commodities Risk
\u2014
\u2014
\u2014
\u2014
Global Risk
504
3,017
486
489
Several validation processes are conducted over time to ensure the internal VaR model is appropriate for
assessing the risk in the Group\u2019s positions, with different scopes and frequencies, including back testing,
diversification effects estimation, and analysis of the comprehensiveness of risk factors.
In addition to VaR, the Group continuously tests a broad range of stress scenarios, the results of which are
analysed to identify risk concentrations not captured by the VaR model.
(1) Trading Book - positions allocated to the Trading Management Area (and not specifically to the accounting trading book)
Interest rate risk
Interest rate risk from Banking Book operations is evaluated through a monthly risk sensitivity analysis, covering
all operations in the Group\u2019s consolidated Balance Sheet, categorised by exposure currency. Market interest rate
fluctuations impact the Group\u2019s net interest income in both the short- and long-term, as well as its economic
value.
Key sources of this risk include Repricing Risk, from timing mismatches in asset and liability repricing; Yield Curve
Risk, due to shifts in the interest rate environment affecting future cash flow valuations; Basis Risk, arising from
unequal variations in reference rates with the same repricing period; and Credit Spread Risk, reflecting changes in
credit spreads that impact asset and liability fair values.
Additionally, behavioural factors such as assumptions relating to deposits with no defined maturity, early
repayments of consumer and mortgages, and redemptions of term deposits contribute to Interest Rate Risk in
the Banking Book (IRRBB).
In order to identify the exposure of the Group's banking book to these risks, the monitoring of the interest rate risk
takes into consideration the financial characteristics of each of the relevant contracts, with the respective
expected cash-flows (principal and interest, without the spread component but including costs for liquidity,
capital, operational and other) being forecasted according to the repricing dates, thus allowing for the calculation
of the impact on economic value resulting from alternative scenarios of change of market interest rate curves.
The Group measures interest rate risk exposure using standardised sensitivity scenarios, typically assessing the
impact of parallel shifts of \u00b1100 and \u00b1200 basis points on the economic value of the Banking Book. These analyses
are complemented by the Supervisory Outlier Tests (SOTs), which assess exposure to IRRBB in the context of
SREP, identifying potential adverse impacts on EVE under shock scenarios.
The following tables show the expected impact on the banking book economic value of the Banking Book
resulting from parallel shifts in the yield curve by \u00b1100 and \u00b1200 basis points, for each of the main currencies in
which the Group holds material positions:
(Thousands of euros)
2025
Currency
- 200 bp (*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
13,384
6,589
(6,339)
(12,400)
EUR
(358,503)
(126,800)
37,901
16,341
PLN
188,824
119,038
(126,652)
(187,148)
USD
(16,743)
(7,575)
5,926
11,417
(173,038)
(8,748)
(89,164)
(171,790)
(*) Scenario of decreasing rates, limited to non-negative rates (which implies effective variations of lesser amplitude than 100 bp, especially in shorter
periods).
(Thousands of euros)
2024
Currency
- 200 bp (*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
3,734
1,668
(1,713)
(3,393)
EUR
(55,339)
(17,400)
(2,590)
(15,642)
PLN
157,210
69,159
(69,603)
(119,933)
USD
(16,628)
(8,178)
7,192
14,240
88,977
45,249
(66,714)
(124,728)
(*) Scenario of decreasing rates, limited to non-negative rates (which implies effective variations of lesser amplitude than 100 bp, especially in shorter
periods).
As described in accounting policy 1.B, the financial statements of the Group's subsidiaries and associates placed
abroad are prepared in their functional currency and translated into euro at the end of each financial period. The
exchange rates used for the conversion of balance sheet amounts in foreign currency are the ECB reference rates
at the end of each period. The conversion of results in foreign currency is calculated using average exchange rates
according to the closing exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
Balance sheet
Income statement
Currency
2025
2024
2025
2024
AOA
1,086.3720
955.3050
1,039.0178
954.9984
BRL
6.4430
6.3942
6.2834
5.8558
CHF
0.9304
0.9382
0.9361
0.9514
MOP
9.4141
8.2838
9.4141
8.2838
MZN
75.0650
65.9290
71.9105
68.9735
PLN
4.2228
4.2767
4.2361
4.3048
USD
1.1743
1.0355
1.1262
1.0819
Foreign exchange and equity risk of the banking book
The foreign exchange risk of the banking book is internally transferred to the Trading area, in accordance with the
Group\u2019s risk specialisation model for management of foreign exchange risk on the balance sheet. Structural
foreign exchange exposures, including those resulting from interests in subsidiaries, are not transferred and may
be hedged using market operations, in accordance with the defined strategy for structural foreign exchange risk
management. This strategy aims at hedging against volatility in the CET1 ratio stemming from changes in
exchange rates.
As at 31 December 2025, the Group 's financial investments denominated in foreign currency were not hedged.
When such hedges exist, on a consolidated basis, these are identified as net investment hedge sunder IFRS
nomenclature. On an individual basis, they are designated as fair value hedges of the relevant investments. Gains
and losses on instruments used to hedge net investments in foreign institutions are recognised in foreign
exchange reserves and presented in the statement of comprehensive income.
The transfer of funds, including dividends, owed by BCP subsidiaries or associates in third countries, particularly
those outside the European Union, may be subject to restrictions and exchange controls that, at any given time,
are in force in the subsidiary\u2019s or associate\u2019s country of incorporation.
Regarding equity risk, the Group holds a limited number of low-risk positions, primarily within the investment
portfolio, mainly resulting from foreclosure or payment-in-kind processes. These positions are managed by a
specialised unit within the Group, with the associated risk monitored through metrics and limits set for market
risk control.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators set by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also fixed.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is
based on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are
calculated on a daily basis, taking into account the impact on the liquidity buffers available to discount with the
respective central banks at the reference date of future estimated cash flows for each of the respective time
horizon (3 days or 3 months) considering the set of transactions intermediated by the market areas, including
transactions carried out with Corporate and Private networks customers, which, due to their size, must be quoted
by the Trading Room. The remaining buffer in each time bucket is then compared to the amount of customer
deposits, being the indicators assessed against exposure limits defined in the Group's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis, identifying all
the factors that justify the variations that have occurred. This analysis is submitted to the Capital and Assets and
Liabilities Committee (CALCO) for appraisal, with a view to making decisions that lead to the maintenance of
financing conditions adequate to the business sustainability.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterise the Bank's risk profile and to ensure that the Group
and each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support
the liquidity contingency plan and management decisions.
The Group\u2019s liquidity position remained resilient throughout 2025, supported by a significant increase in on
balance sheet customer funds (+7.0% year-on-year on a consolidated basis), driven mainly by the strong
momentum of the Polish operation (+13,0%). Credit started a growth trend, rising by 7,3% at Group level, largely
fueled by the solid performance in Portugal (+9.3%). From a balance sheet perspective, the growth in on-balance
sheet funds once again exceeded that of loans, generating a liquidity surplus that supported the expansion of the
securities portfolio, which grew 15.0% at group level.
As a result, liquidity buffers held with central banks remained robust, increasing in the three main geographies.
Key regulatory and internal liquidity risk indicators continued to display comfortable levels.
As at 31 December 2025, with regard to short-term liquidity, the Liquidity Coverage Ratio (LCR) stood at 334% on a
consolidated basis, compared to 342% at the same date in the previous year, ensuring a comfortable buffer above
the minimum regulatory requirement of 100%.
From a structural perspective, the Group maintained its stable funding base, primarily supported by customer
deposits\u2014particularly in the retail segment\u2014and complemented by medium and long-term funding instruments,
namely issuances under the MREL framework and the Bank Millennium covered bond programme. As a result, as
at 31 December 2025, the Net Stable Funding Ratio (NSFR) reached 180%, broadly in line with the 181% recorded
one year earlier, thereby maintaining a substantial buffer above the minimum regulatory requirement of 100%.
The loan-to-deposit ratio stood at 68% at the end of December 2025, close to the ratio observed on the same date
the previous year., reflecting a prudent balance sheet management approach alongside the recovery of lending
activity in Portugal since the beginning of the year.
Following important rating upgrades since 2023, by the end of 2025 BCP\u2019s subordinated debt was assessed as
investment grade by S&P, Moody\u2019s and DBRS. From January 2025 the spread of BCP in Senior Preferred (\u201cSP\u201d) and
subordinated debt (\u201cT2\u201d) tightened materially, due not only to market conditions but also to the strong positive
BCP\u2019s intrinsic factors. During 2025, BCP executed three transactions in the wholesale market: on 20 March a EUR
500,000,000 12nc7 4,750% T2 Notes, to refinance the call-option on 27 March of the EUR 450,000,000 3,871%
10,5nc5,5 T2 Notes; at the same date the Bank launched a Tender Offer on BCP\u2019s EUR 166,000,000 6.888% 2027 T2
Notes which remained outstanding after the 2022 Exchange Offer, with valid tenders in an aggregate nominal
amount of EUR 79,500,000, and decided to accept for purchase all Notes validly tendered; on 24 June, a EUR
500,000,000 6NC5 3.125% SP Notes to refinance the exercise, on 2 October and also in favourable pricing
conditions, of the call-option on the EUR 500,000,000 5.625% SP Notes.
The liquidity buffer available with the ECB amounted to EUR 34,725,574,000 at the end of 2025, EUR 977,437,000
higher than one year earlier. At the end of 2025, the liquidity buffer included a long position of EUR 1,739,808,000
with the ECB.
Throughout 2025, in addition to increasing its deposit\u2019s base, Bank Millennium reinforced its structural liquidity
position through the execution of covered bond issuances of PLN 800,000,000 in March and PLN 1,000,000,000 in
November. As a result, the outstanding balance of the instrument reached PLN 2,600,000,000 as at December
2025.
Millennium Bim maintained during 2025 a robust liquidity position, based on the stability of its local deposits\u2019
base.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after
haircuts, is detailed as follows:
(Thousands of euros)
2025
2024
European Central Bank
14,965,278
15,437,781
Other Central Banks
13,676,940
10,001,379
28,642,218
25,439,160
The amount discounted with the Bank of Mozambique amounts to EUR 398,000 (31\u00a0December 2024: EUR
755,000). There are no discounted amounts with other central banks.
The evolution of the ECB\u2019s Monetary Policy Pool, of the net borrowings at the ECB and of the liquidity buffer is
analysed as follows:
(Thousands of euros)
2025
2024
Collateral eligible for ECB, after haircuts:
The pool of ECB monetary policy (i)
14,965,278
15,437,781
Outside the pool of ECB monetary policy
18,020,487
15,489,545
32,985,765
30,927,326
Net borrowing at the ECB (ii)
(1,739,808)
(2,820,810)
Liquidity buffer (iii)
34,725,573
33,748,136
i) Corresponds to the amount reported in ECMS (Banco de Portugal application).
ii) Includes as at 31 December 2025 the amount of deposits with the Banco de Portugal and other liquidity with the Eurosystem (EUR 2,296,690,000) in
excess over the minimum cash reserves (EUR 556,882,000).
iii) Eligible collateral available for discount with the ECB, after haircuts, deducted from the net funding at the ECB.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels
over the next years, with no material impact, considering the liquidity buffers of the issuing entities.
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk
Committee, the following information is presented in accordance with COMMISSION IMPLEMENTING
REGULATION (EU) 2024/3172 of 29 November 2024 supplementing Regulation (EU) No 575/2013 of the European
Parliament and of the Council with regard to regulatory technical standards for disclosure of encumbered and
unencumbered assets.
(Thousands of euros)
2025 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the reporting
institution
2,825,812
1,652,402
103,830,893
37,426,892
Equity instruments
\u2014
\u2014
\u2014
\u2014
347,486
\u2014
347,486
\u2014
Debt securities
1,652,402
1,652,402
1,610,693
1,610,693
38,711,751
33,438,423
38,728,409
33,370,929
of which: covered
bonds
\u2014
\u2014
\u2014
\u2014
386,650
386,650
386,650
386,650
of which:
securitisations
\u2014
\u2014
\u2014
\u2014
54
\u2014
54
\u2014
of which: issued by
general governments
1,652,402
1,652,402
1,610,693
1,610,693
30,381,782
29,704,706
30,253,269
29,561,544
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
2,432,641
1,117,197
2,440,508
1,123,302
of which: issued by
non-financial
corporations
\u2014
\u2014
\u2014
\u2014
3,855,996
621,978
3,902,142
621,978
Other assets
1,215,490
\u2014
64,853,304
4,011,894
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2025 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing
institution
\u2014
\u2014
542,931
101,958
Debt securities
\u2014
\u2014
451,288
101,958
of which: covered bonds
\u2014
\u2014
264,730
\u2014
of which: issued by general governments
\u2014
\u2014
101,958
101,958
of which: issued by financial corporations
\u2014
\u2014
329,161
\u2014
Loans and advances other than loans on
demand
\u2014
\u2014
90,831
\u2014
Own covered bonds and securitisations issued
and not yet pledged
9,180,214
\u2014
TOTAL COLLATERAL RECEIVED AND OWN
DEBT SECURITIES ISSUED
2,825,812
1,652,402
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
2025 (1)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered bonds
and securitisations encumbered
Carrying amount of selected financial
liabilities
1,295,122
1,702,554
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
At the end of December 2025, and according to the EBA methodology, the total encumbered assets represent 3%
of the Group's total balance sheet assets. Debt securities represents 58% of the total encumbered assets while
encumbered Loans to customers represents 34%.
The main sources of asset encumbrance in Portugal stem from repurchase agreement operations, collateral swap
operations, collateralisation of derivative operations and securitisation programs collateralised by certain Loans to
Customers\u2019 portfolios. Collateralisation of securitisation operations in Poland, derivatives central counterparty
clearing houses and other commitments with the Deposit Guarantee Fund, are primarily supported by eligible
sovereign debt held with the central bank of Poland.
On 31st December 2025, the Other assets includes unencumbered assets in the amount of EUR 3,144,521,000
related to Loans on demand, the amount of EUR 55,900,224,000 related to Loans and advances other than loans
on demand (of which encumbered assets in the amount of EUR 949,464,000) and the amount of EUR
6,060,596,000, mostly unencumbered and related to the Group\u2019s activity, namely: investments in associated
companies and subsidiaries, tangible assets and investment properties, intangible assets, assets associated with
derivatives and current and deferred taxes.
On 31st December 2025, BCP Group has a EUR 12.5 billion BCP Covered Bond Programme (\u201cBCP Programme\u201d)
with EUR 11.2 billion of covered bonds outstanding. The BCP Programme is backed by a EUR 13.4 billion portfolio of
residential mortgages, as well as by a liquidity buffer of EUR 50 million, totalling an over collateralisation of 20.0%,
which is above the minimum of 12.0% currently required by rating agencies.
The Portuguese covered bond legislation, under which the BCP Programme has been updated and authorised, in
2023, for the issuance of \u201cCovered Bonds (Premium)\u201d (label now born by all its outstanding covered bonds), affords
covered bond holders a dual-recourse, firstly over the issuer, secondly over the cover pool that may also include
other eligible assets, over which they benefit from a special preferential claim. The Portuguese covered bond
legislation ensures total segregation of the covered pool from any future issuer\u2019s insolvent estate, for the benefit of
covered bond holders, who have precedence over claims of any other of the issuer\u2019s creditors in case of issuer
insolvency, thus and to this extent superseding the general insolvency and recovery legislation. Residential
mortgages included in BCP Programme\u2019s cover pool are subject to certain eligibility criteria inscribed in the
Portuguese covered bond legislation, including a maximum LTV of 80%, delinquency of no more than 90 days,
and them being first lien mortgages (or, if otherwise, all preceding liens being in the cover pool) over properties
located in the EU. The BCP\u2019s Programme documentation limits the mortgaged properties\u2019 location to Portugal
only.
As regard Poland Covered Bonds, Millennium Bank Hipoteczny S.A. (\"MBH\") initiated operations on 14 June 2021,
with an initial capital of PLN 120 million, fully subscribed by Bank Millennium S.A. In 2024, MBH issued two covered
bonds with a five-year maturity, with the amounts of PLN 800 million and PLN 1,000 million. As of December 2025,
MBH's covered bonds have the highest possible AAA rating by Fitch Ratings.
MBH's covered bonds are secured by mortgage receivables under loans granted by the Bank and by Polish
government debt. These loans meet specific criteria, including being in PLN, intended for housing purposes,
having ownership titles with established mortgages in favor of Bank Millennium in the first place, no evidence of
impairment, and loan values lower than the mortgage lending value.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
Demand
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
\u2014
\u2014
\u2014
4,089,540
Loans and advances to Credit
Institutions - Repayable on demand
186,011
\u2014
\u2014
\u2014
\u2014
\u2014
186,011
Other loans and advances (a)
\u2014
819,520
27,965
14,258
\u2014
\u2014
861,743
Loans and advances to customers (a)
\u2014
\u2014
8,846,738
14,060,004
35,227,857
587,901
58,722,500
Other financial assets (b)
\u2014
3,942,680
2,116,949
8,975,393
1,990,205
428,206
17,453,433
4,275,551
4,762,200
10,991,652
23,049,655
37,218,062
1,016,107
81,313,227
Liabilities
Deposits from Credit Institutions
\u2014
822,187
55,986
398
\u2014
\u2014
878,571
Deposits from costumers
53,469,091
24,744,000
9,255,155
204,614
\u2014
\u2014
87,672,860
Debt securities issued
\u2014
\u2014
\u2014
3,144,400
749,193
\u2014
3,893,593
Subordinated debt
\u2014
\u2014
\u2014
455,668
955,990
\u2014
1,411,658
53,469,091
25,566,187
9,311,141
3,805,080
1,705,183
\u2014
93,856,682
(a) Gross of impairment
(b) Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
Operational Risk
Operational risk management is a strategic pilar for the Group\u2019s resilience and sustainability. It is structured in
accordance with the \u201cthree Lines of Defence\u201d Corporate Governance model and supported by an integrated end-
to-end process view, ensuring a holistic approach to the identification, assessment and mitigation of operational
risks. This framework not only strengthens internal control mechanisms but also supports initiatives aimed at
enhancing operational efficiency and reinforcing business continuity management.
The First Line of Defence, composed of process owners and process managers, is responsible for the day-to-day
management of operational risk. In addition to ensuring the effectiveness and efficiency of processes, it is
responsible for identifying, recording and analysing operational losses, monitoring the relevant Key Risk Indicators
(KRIs), conducting Risk Self-Assessment (RSA) exercises, and defining and implementing appropriate mitigation
measures to address operational risk exposures. These actions are subject to periodic review, ensuring continuous
alignment between the Group\u2019s risk profile and business evolution, as well as the ongoing strengthening of the
internal control environment.
The Second Line of Defence, represented by the Risk Office and the Compliance Office, provides oversight,
monitoring and effective challenge of the First Line\u2019s activities. The Third Line of Defence, Internal Audit,
independently assesses the adequacy, effectiveness and compliance of the overall operational risk management
framework, ensuring its proper functioning.
Throughout 2025, the various stakeholders involved in operational risk management continued to perform the
standard risk management activities, ensuring the efficient and systematic identification, assessment, mitigation
and control of risk exposures, as well as the appropriate reporting to the Group\u2019s governing bodies and to
regulatory authorities.
The results of the RSA exercises continue to evidence a robust control environment, demonstrating the Group\u2019s
strong commitment to operational risk management through the continuous development of improvement
initiatives aimed at mitigating risk exposures. The pattern of recorded operational losses remained within normal
and expected levels.
Ongoing KRI monitoring has enabled the identification of improvement opportunities which, combined with RSA
exercises and the operational loss identification and recording process, support effective and proactive risk
management.
The Group\u2019s transformation strategy, focused on digitalisation and the integration of new technologies, introduces
significant operational risk challenges. Key priorities include strengthening the security of digital banking
channels, enhancing fraud prevention and detection mechanisms, reinforcing the ICT risk management
framework, ensuring robust personal data governance, and maintaining strict compliance with legally required
information duties in digital sales channels.
Covenants
The contractual terms of instruments of various wholesale funding instruments encompass obligations assumed
by entities belonging to the Group as borrowers or issuers, concerning general duties of corporate conduct,
maintenance of banking activity and the in existence of special guarantees constituted for the benefit of other
creditors (\u201cnegative pledge\u201d). These terms essentially reflect the internationally adopted standards for each of the
types of debt instruments used by the Group.
The terms of the Group\u2019s intervention in rated securitisation transactions involving its own assets are subject to
changes in case the Group triggers certain rating criteria. The criteria established in each transaction results
mainly from the analysis performed at the moment that the transaction was structured, being usually applied by
each rating agency in a standardised way to the securitisation transactions involving the same type of assets.
Regarding the Covered Bond Programmes of Banco Comercial Portugu\u00eas, there are no relevant covenants
related to a possible downgrade of BCP.
Hedge accounting
The detailed information of the strategies, hedge transactions, hedged items and hedging instruments applied by
the Group, is shown in a table below:
Strategy
Description of hedge transactions
Hedged items
Hedging
instruments
Cash flow volatility hedge of
the flows generated by the
portfolio of EUR floating rate
mortgage loans (a)
Group hedges the risk of the volatility of interest
payments from floating rate mortgages. The
volatility of cash flows results from interest rate risk
Floating rate mortgage loans (BCP
S.A.)
Interest Rate
Swap (IRS)
transactions
Cash flow volatility hedge due
to future income and interest
costs denominated in foreign
currencies (a)
The Group hedges the risk of the volatility of cash
flows generated by income and interest costs
denominated in foreign currencies. The volatility of
cash flows results from the currency risk
Cash flows resulting from income
and interest costs denominated in
foreign currencies (Bank
Millennium S.A.)
FX position
transactions
Cash flow volatility hedge for
the flows generated by FX
mortgage portfolio and its
underlying PLN liabilities (a)
The Group hedges the risk of the volatility of cash
flows generated by FX mortgages and by PLN
liabilities financially underlying such loans. The
volatility of cash flows results from the currency risk
and interest rate risk
Cash flows resulting from the FX
mortgage loan portfolio and PLN
deposits together with issued debt
PLN securities funding them (Bank
Millennium S.A.)
CIRS
transactions
Hedge of volatility of the cash
flows generated by PLN
denominated financial assets
(a)
The Group hedges the risk of the volatility of cash
flows generated by PLN denominated financial
assets. The volatility of cash flows results from
interest rate risk
Cash flows resulting from PLN
denominated financial assets (Bank
Millennium S.A.)
IRS
transactions
Fair value hedge of fixed rate
loans (a)
Group hedges changes in the fair value of cash
flows of fixed rate loans due to changes in market
interest rates
Fixed rate loans (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at amortised cost
(BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
debt instruments in EUR (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate debt securities, classified
as Financial assets at fair value
through other comprehensive
income (BCP S.A. and ActivoBank
S.A.)
IRS
transactions
Fair value hedge of fixed rate
issued debt instruments in EUR
(a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in market interest rates
Fixed rate Issued debt (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Term deposits (BCP S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in EUR (macro hedge)
(a)
Group hedges changes in the fair value of fixed rate
deposits due to changes in market interest rates
Repayable demand deposits
without maturity (BCP S.A. and
ActivoBank S.A.)
IRS
transactions
Fair value hedge of fixed rate
deposits in USD (a)
Group hedges changes in the fair value of fixed rate
bonds due to changes in foreign exchange and in
market interest rates
Term deposits (BCP S.A.)
CIRS
transactions
Fair value hedge of a fixed
interest rate debt instrument
(macro hedge) (a)
The Group hedges part of the interest rate risk
associated with the change in the fair value of a
fixed-rate debt instrument recorded in other
comprehensive income, resulting from fluctuations
in market interest rate
A portfolio of fixed coupon debt
securities classified as financial
assets measured at fair value
through other comprehensive
income denominated in PLN (Bank
Millennium S.A.)
IRS
transactions
Hedging the fair value of cash
flows from issued fixed-rate
liabilities denominated in
foreign currencies (a)
The Group hedges part of the interest rate risk
related to changes in the fair value of cash flows
from issued fixed-rate liabilities denominated in
foreign currencies, resulting from the volatility of
market interest rates
Cash flows from issued fixed-rate
liabilities denominated in foreign
currencies (Bank Millennium S.A.)
IRS
transactions
Hedging the fair value of the
risk profile assigned to a
portfolio of homogeneous, non-
interest-bearing current
accounts in PLN (portfolio
hedge) (b)
The Group hedges part of the interest rate risk
related to the change in the fair value of the risk
profile assigned to the portfolios of homogeneous,
non-interest-bearing current accounts in PLN and
separately foreign currencies, resulting from the
volatility of market interest rates.
Risk profile assigned to a portfolios
of homogeneous, non-interest-
bearing current accounts in PLN
and separately in foreign currencies
(Bank Millennium S.A.).
IRS
transactions
(a) - Strategy applied in 2025 and 2024.
(b) - Strategy applied in 2025.
As at 31\u00a0December 2025, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2025
Hedging instruments
Book value
Change in
fair value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
36,938,459
30,536
34,026
(17,841)
Foreign exchange risk
Currency and interest rate swap
334,311
1,746
6,950
207
37,272,770
32,282
40,976
(17,634)
Cash flows hedging
Interest rate risk
Interest rate swaps
9,814,724
83
1,752
(1,636)
Total
47,087,494
32,365
42,728
(19,270)
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2024, the table below includes the detail of the hedging instruments used in the Group's
hedging strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2024
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
23,798,173
47,629
8,759
60,064
Foreign exchange risk
Currency and interest rate swap
376,647
19,312
\u2014
(253)
24,174,820
66,941
8,759
59,811
Cash flows hedging
Interest rate risk
Interest rate swaps
11,501,067
2,408
6,724
468,167
Foreign exchange risk
Currency and interest rate swap
81,633
\u2014
23,558
998
11,582,700
2,408
30,282
469,165
Total
35,757,520
69,349
39,041
528,976
(A) Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31\u00a0December 2025, the table below includes the detail of the hedged items:
(Thousands of euros)
2025
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
1,139,290
\u2014
(20,453)
\u2014
(8,889)
n/a
n/a
(H)
13,373,963
\u2014
(86,703)
\u2014
(70,206)
n/a
n/a
(C)
6,006,753
\u2014
(57,540)
\u2014
(3,523)
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
10,955,660
\u2014
(13,139)
98,552
n/a
n/a
(F)
\u2014
3,028,763
\u2014
(13,456)
7,999
n/a
n/a
(G)
\u2014
1,042,739
\u2014
(10,783)
(3,359)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(C)
87,345
\u2014
75
\u2014
75
n/a
n/a
(E)
\u2014
246,966
\u2014
405
(406)
n/a
n/a
20,607,351
15,274,128
(164,621)
(36,973)
20,243
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
9,814,724
\u2014
\u2014
\u2014
1,636
(3,682)
(488,955)
Total
30,422,075
15,274,128
(164,621)
(36,973)
21,879
(3,682)
(488,955)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
As at 31\u00a0December 2024, the table below includes the detail of the hedged items:
(Thousands of euros)
2024
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change in
fair value
(A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
879,845
\u2014
(11,565)
\u2014
8,706
n/a
n/a
(H)
8,999,175
\u2014
(32,878)
\u2014
(372)
n/a
n/a
(C)
2,710,442
\u2014
(54,996)
\u2014
33,078
n/a
n/a
(D)
\u2014
\u2014
\u2014
\u2014
\u2014
n/a
n/a
(E)
\u2014
6,757,347
\u2014
127,030
(63,732)
n/a
n/a
(F)
\u2014
2,523,356
\u2014
(5,507)
(15,188)
n/a
n/a
(G)
\u2014
1,062,003
\u2014
(17,808)
(24,023)
n/a
n/a
Foreign exchange risk
Currency and interest
rate swap
(E)
\u2014
376,647
\u2014
(81)
137
n/a
n/a
12,589,462
10,719,353
(99,439)
103,634
(61,394)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
11,501,067
\u2014
\u2014
\u2014
(468,167)
(2,245)
(877,187)
Foreign exchange risk
Currency and interest rate
swap
(B)
81,633
\u2014
\u2014
\u2014
(1,050)
(165)
\u2014
11,582,700
\u2014
\u2014
\u2014
(469,217)
(2,410)
(877,187)
Total
24,172,162
10,719,353
(99,439)
103,634
(530,611)
(2,410)
(877,187)
(A) Change in fair value of the hedge item used to calculate the ineffectiveness of the hedge
(B) Financial assets at amortised cost - Loans and advances to customers
(C) Financial assets at fair value through other comprehensive income
(D) Financial liabilities at amortised cost - Deposits from credit institutions and other funds
(E) Financial liabilities at amortised cost - Deposits from customers and other funds
(F) Financial liabilities at amortised cost - Non-subordinated debt securities issued
(G) Financial liabilities at amortised cost - Subordinated debt
(H) Debt securities not associated with credit operations
The reconciliation of each equity component and an analysis of other comprehensive income attributable to
hedge accounting, is as follows:
(Thousands of euros)
Cash flow hedge reserve
2025
2024
Balance as at 1 January
(879,597)
(1,280,910)
Amounts recognised in other comprehensive income:
\u00a0 Cash flow hedge
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,636)
469,217
\u00a0 \u00a0 Foreign exchange changes
(65)
(196)
\u00a0 \u00a0 Hedge breakage
388,232
(68,716)
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
(6)
52
\u00a0 \u00a0 Other
435
956
Balance at the end of the year
(492,637)
(879,597)
The table below includes information on the effectiveness of hedging relationships, as well as impacts on profit or
loss and other comprehensive income, as at 31\u00a0December 2025:
(Thousands of euros)
2025
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
2,733
(E)
\u2014
17,380
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(124)
\u2014
\u2014
\u2014
2,609
\u2014
17,380
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
4,798
6
(E)
(389,944)
\u2014
Total
4,798
2,615
(389,944)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest an similar income
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results
and other comprehensive income, as at 31\u00a0December 2024:
(Thousands of euros)
2024
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensive
income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to P&L
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged
item with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(1,467)
(E)
\u2014
6,761
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
(116)
\u2014
\u2014
\u2014
(1,583)
\u2014
6,761
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
2,740
\u2014
(E)
(335,276)
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
1,225
(52)
\u2014
\u2014
3,965
(52)
(335,276)
\u2014
Total
3,965
(1,635)
(335,276)
\u2014
(A) Income Statement item in which the ineffectiveness of the hedge was recognised
(B) Income Statement item in which the reclassified amount was recognised
(C) but which are no longer expected to occur
(D) Gains/(losses) on hedge accounting
(E) Interest and similar income
The table below shows the detail of hedging instruments, as at 31\u00a0December 2025, by maturity:
(Thousands of euros)
2025
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
540,762
985,263
35,412,434
36,938,459
30,536
34,026
Fixed interest rate (average)
1.03%
5.51%
3.05%
3.09%
Fair value hedging derivatives related to
currency risk changes
OTC Market:
Currency and interest rate swap
89,419
157,547
87,345
334,311
1,746
6,950
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
\u00a0 Interest rate swaps
205,000
3,204,724
6,405,000
9,814,724
83
1,752
Total derivatives traded by
OTC Market:
835,181
4,347,534
41,904,779
47,087,494
32,365
42,728
The table below shows the detail of hedging instruments, as at 31\u00a0December 2024, by maturity:
(Thousands of euros)
2024
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months
to 1 year
Over 1 year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
463,500
201,596
23,133,077
23,798,173
47,629
8,759
Fixed interest rate (average)
-0.35%
3.15%
2.77%
2.72%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
96,576
280,071
\u2014
376,647
19,312
\u2014
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
1,205,000
2,107,537
8,188,530
11,501,067
2,408
6,724
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
81,633
\u2014
\u2014
81,633
\u2014
23,558
Total derivatives traded by
OTC Market:
1,846,709
2,589,204
31,321,607
35,757,520
69,349
39,041
Climate risks - Integration of ESG Factors in Risk Management
In its risk taxonomy, the BCP Group recognises that climate and nature-related dimensions, as well as the social
and governance aspects, collectively referred to as ESG (Environmental, Social and Governance), act as drivers that
impact traditional risk categories.
These drivers are not considered separately; in fact, they are regarded as likely to affect, positively or negatively, the
financial performance and solvency of the Bank's customer\u2019s and counterparties. Accordingly the materialisation
of their impacts occurs by means of the \u201ctraditional\u201d categories: credit, market, liquidity, operational and
reputational risk.
Within this context, and with the purpose of promoting the integration of ESG factors in risk management, the
Bank has implemented a set of processes and methodologies to identify, assess, manage and monitor the impact
of the ESG drivers in overall risk, in accordance with the framework and policies already established for the
remaining financial and non-financial risks.
Governance Model
The governance model for risks arising from ESG factors follows a structure based on three lines of defence which,
under the leadership of the Board of Directors (BoD) and respective delegations, namely on the Executive
Committee (EC), the Risk Assessment Committee (CAvR) and the Committee for Corporate Governance, Ethics
and Sustainability(CGSES) ensure its adequate assessment and management. The Board of Directors has overall
responsibility for the Group's ESG strategy, management and control structure.
The EC is responsible for proposing to the BoD, through the CGSES and/or the CAvR, several activities, such as the
Business Environment Analysis Report (BEAR; Corporate/Business Context Analysis), the Climate and Nature
Materiality Assessment (C&NA) and the DMA (Double Materiality Assessment) for its overall implementation and
management and for the compliance with the regulatory and supervisory guidelines, aiming to ensure that the
ESG opportunities are duly explored, and the associated risks properly managed.
The CGSES is responsible for supervision, while the EC, assisted by their Human Resources and Sustainability
Commissions, is responsible for managing issues related to the promotion of Human Rights, namely establishing,
implementing, and monitoring this Policy and others related to the topic. Furthermore, the CGSES is also
responsible to advise and assisting the BoD in the evaluation and approving the Group\u2019s Sustainability Master Plan
(SMP), monitoring its progress, and supervising the compliance with national and international legal and
regulatory ESG requirements.
The Risk Assessment Committee has in its competences and duties to advise the BoD on the identification,
management, and control of ESG risk factors, while monitoring the risk appetite and underlying performance of
the Group, as well as supervising the adequacy of the ESG internal control system, with a special focus on the
effectiveness of the risk management system to deal with ESG risk drivers.
The Sustainability Committee, which emanates from the EC, is chaired by the Chief Executive Officer (CEO), and is
the body responsible for evaluating, discussing and monitoring the implementation of the sustainability strategy
at the organisational level. He has the responsibility to support the EC in integrating ESG aspects into the Group's
business and risk management framework. This includes overseeing the progress of implementation, ensuring
that deadlines are met, and validating the results of each initiative.
Identification of ESG risks
Climate and nature-related risks arise from the Bank\u2019s exposure to customers, counterparties, and assets that may
be potentially affected by, or contribute to, the negative impacts of climate change and nature degradation, as
well as by changes in the legislative and regulatory framework. These factors may result in negative financial
impacts, the materiality of which must be assessed by the Bank. Both risk dimensions \u2013 climate-related and
nature-related \u2013 can be divided into:
\u2022 Physical Risks: arising from the physical effects of climate change and environmental degradation. They can be
categorised as acute risks, if they arise from extreme events (such as wildfires, floods or pest outbreaks); and
chronic risks, if they arise from progressive changes in weather and climate patterns (e.g., changes in average
global temperature, sea-level rise) or from a progressive loss of natural ecosystems (e.g., deforestation, pollution
stemming from pesticides).
\u2022 Transition Risks: stem from the adjustment process / efforts, ongoing or expected in the future, towards a low-
carbon and environmentally sustainable economy. In general, transition risk can be analysed based on three
underlying factors: i) climate and nature-related policy and regulatory changes; ii) technological developments;
and iii) shifts in behaviour and / or market sentiment.
The materialisation of social risks is also assessed, considering the issues related to the rights, well-being and
interests of individuals and communities and includes factors such as (in)equality, health, diversity, inclusion,
labour relations, workplace health and safety, human capital and communities.
In addition, governance risk factors are also identified by Millennium BCP, through issues relating to leadership,
remuneration, shareholder rights, corruption and bribery, management and prevention of conflicts of interest,
quality of internal control and independent reviews/auditing, transparency and good tax practices, for example.
Management and Monitoring Principles
ESG risks management and respective strategy follows a different logic compared to 'traditional' risks. In contrast,
with these, the materialisation of ESG risks is expected to occur over extended timeframes, which is why the
establishment of strategy and risk appetite follows different timeframes. For example, if the assessment of
physical (acute) risks can determine an action strategy more focused on the short term (e.g., considering the
establishment of additional mitigation measures, at the level of policies for granting credit and insurance policy),
the transition risks justify a more structural approach, based on collecting information, evaluating customers and
monitoring their performance over time.
From this perspective, Millennium BCP's management of ESG impacts follows the following principles:
\u2022 Establishment of a responsible corporate financing policy, which excludes or conditions the credit operations in
sectors and/or activities with greater environmental and social impact.
\u2022 Integration of the strategy for managing risks arising from ESG factors into the Bank's global sustainability plan,
which steers the integration of the ESG dimension into business processes, establishing goals, timelines and a
model for controlling proper observance.
\u2022 Communication Transparency: The Bank publicly discloses its sustainability objectives and key practices, as well
as its management of ESG (Environmental, Social, and Governance) impact factors. This allows all stakeholders
to assess the robustness of its approach, including its exposure to risks arising from ESG factors.
\u2022 Regular monitoring of exposure to risks arising from ESG factors: this is done through established management
information routines for each risk category.
\u2022 Focus on credit risk management: This is achieved through models that facilitate the integration of the ESG
dimension in the risk assessment of the Bank's key companies/customers. This ensures that business decisions
incorporate an evaluation of the primary impacts of ESG factors.
\u2022 Collection and structuring of information: Utilizing public sources and information provided directly by
customers, this approach aims to enhance understanding of customers' ESG performance and potential
financial impacts associated with any limitations in that performance.
\u2022 Regular process for monitoring employees' capabilities and knowledge on sustainability-related topics.
The operationalization of these principles is facilitated through an internal policy for managing risks arising from
ESG factors, which establishes the following key risk tools:
\u2022 Regular assessment of the materiality of risks arising from ESG factors to confirm alignment with risk appetite
and the need for implementing mitigation actions.
\u2022 Methodologies for assessing risks arising from ESG factors integrated into credit risk assessment models.
\u2022 Risk classification methodologies at the portfolio level, allowing the identification of sectors, companies, and
exposures most susceptible to transition and/or physical risks (climate and nature-related).
\u2022 Models for quantifying financed greenhouse gas (GHG) emissions, supporting strategic discussions on the
management of these emissions and their gradual alignment with the objectives of the Paris Agreement.
\u2022 Sensitivity analyses and stress testing focusing on climate-related factors.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialRiskManagementExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-724": { "value": "
Credit Risk
Credit granting is based on a prior classification of the customers\u2019 risk and on a thorough assessment of the level
of protection provided by the underlying collateral. In order to do so, a single risk-notation system has been
introduced, the Rating Master Scale, based on the expected probability of default, allowing greater discrimination
in the assessment of the customers and better establishment of the hierarchies of the associated risk.
The Rating Master Scale also identifies those customers that show a worsening credit capacity and, in particular,
those classified as being in default. All rating and scoring models used by the Group have been duly calibrated for
the Rating Master Scale. The protection-level concept has been introduced as a crucial element of evaluation of
the effectiveness of the collateral in credit-risk mitigation, leading to a more active collateralisation of loans and to
a better adequacy of pricing regarding the risk incurred.
The gross Group\u2019s exposure to credit risk (original exposure) is presented in the following table:
(Thousands of euros)
Risk items
2025
2024
Central Governments or Central Banks (*)
33,081,155
31,545,676
Regional Governments or Local Authorities
1,619,443
1,304,957
Administrative and non-profit Organisations
6,314,917
4,615,122
Multilateral Development Banks
200,119
290,669
Other Credit Institutions
3,440,851
2,947,599
Retail and Corporate customers
75,949,113
69,428,657
Other items
7,863,835
9,091,787
128,469,433
119,224,467
Note: gross exposures of impairment and amortisation, in accordance with the prudential consolidation scope. Includes securitisation positions.
(*) In 2025 includes DTA's of EUR 1,495,717,787 (31 December 2024: EUR 1,897,830,642).
The evaluation of the risk associated to the loan portfolio and quantification of the respective losses expected
considers the following methodological notes.
a) Collaterals and Guarantees
On the risk evaluation of an operation or of a group of operations, the mitigation elements of credit risk associated
to those operations are considered in accordance with the rules and internal procedures that fulfil the
requirements defined by the regulations in force, also reflecting the experience of the loan's recovery areas and
the Legal Department opinions with respect to the entailment of the various mitigation instruments.
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 108 or better on the Rating Master
Scale;
- personal guarantees when the persons are classified with Risk Grade 108 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organised
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in
restructuring process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk
Grade of the customer by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better
than the customer\u2019s), when the protection is formalised through:
- State, Financial Institutions or Mutual Guarantee Societies guarantees exist;
- Personal guarantees (or, in the case of Leasing, there is a recovery agreement of the provider);
- Credit derivatives;
- Formalisation of the clause of the contracting party in leasing contracts in which it is an entity that is in a
relationship of dominion or group with the lessee.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis
and before decision process.
Either the initial evaluations or the subsequent reviews carried out are performed by external expert valuers and
the ratification process is centralised in the Appraisals Unit, which is independent of the customers\u2019 areas.
In any case, they are the subject to a written report, in a standardised digital format, based on a group of
predefined methods that are aligned with the sector practices \u2013 income, replacement cost and/or market
comparative - mentioning the obtained value, for both the market value and for purposes of the mortgages
guarantee, depending on the type of the real estate. The evaluations have a declaration/certification of an expert
valuer since 2008, as requested by Regulation (EU) 575/2013 and Law 153/2015 of 14 September and are ratified by
the Appraisals Unit.
Regarding residential real estate, after the initial valuation and in accordance with Notice n. 5/2006 of Banco de
Portugal and CRR 575/2013, the Group monitors the respective values through market indexes. If the index is lower
than 0.9, the Group revaluates choosing one of the following two methods:
i) depreciation of the property by direct application of the index, if the amount owed does not exceed EUR
300,000;
ii) review of the property value by external valuators, depending on the value of the credit operation, and in
accordance with the established standards from ECB and Banco de Portugal.
For all non-residential real estate, the Group also monitors its values through market indexes and to the regular
valuation reviews with the minimum periodicities in accordance with the Regulation (EU) 575/2013, in the case of
offices, commercial spaces, warehouses and industrial premises.
For all real estate (residential or non-residential) for which the monitoring result in significant devaluation of the
real estate value (more than 10%), a valuation review is subsequently carried out by an expert valuer, preserving
the referred i) above.
For the remaining real estate (land or countryside buildings for example) there are no market indexes available for
the monitoring of appraisal values, after the initial valuations. Therefore, for these cases and in accordance with
the minimum periodicity established for the monitoring and reviewing of this type of real estate, valuation reviews
are carried out by expert valuers.
The indexes currently used are supplied to the Group by an external specialised entity that, for more than a
decade, has been collecting and processing the data upon which the indexes are built.
In the case of financial collaterals, their market value is daily and automatically updated, through the IT connection
between the collaterals management system and the relevant financial markets data.
b) Risk grades
Credit granting is based on the previous risk assessment of customers and also on a rigorous assessment of the
protection level provided by the underlying collaterals. For this purpose, a single risk grading system is used - the
Rating Master Scale - based on Probability of Default (PD), allowing for a greater discriminating power in
customers' assessment and for a better hierarchy of the associated risk. The Rating Master Scale also allows to
identify customers that show signs of degradation in their credit capacity and, in particular, those that are
classified in a default situation. All rating systems and models used by the Group were calibrated for the Rating
Master Scale.
Aiming at an adequate assessment of credit risk, the Group defined a set of macro segments and segments which
are treated through different rating systems and models that relate the internal risk grades and the customers\u2019
PD, ensuring a risk assessment that considers the customers\u2019 specific features in terms of their respectively risk
profiles.
The assessment made by these rating systems and models result in the risk grades of the Master Scale, that has
eighteen grades, where the last three correspond to relevant downgrades of the customers\u2019 credit quality and are
referred to by \u201cprocedural risk grades\u201d: 123, 124 and 125, that correspond, in this order, to situations of increased
severity in terms default, as risk grade 125 is a Default situation.
The non-procedural risk grades are attributed by the rating systems through automatic decision models or by the
Rating Division \u2013 a unit which is independent from the credit analysis and decision areas and bodies- and are
reviewed/updated periodically or whenever this is justified by events.
The models within the various rating systems are regularly subject to validation, made by the Models Validation
and Monitoring Office, which is independent from the units that are responsible for the development and
maintenance of the rating models.
The conclusions of the validations by the Models Validation and Monitoring Office, as well the respective
recommendations and proposal for changes and/or improvements, are analysed and ratified by a specific
Validation Committee, composed in accordance to the type of model analysed. The proposals for models\u2019 changes
originated by the Validation Committee are submitted to the approval of the Risk Committee.
The following table lists the equivalence between the internal rating levels (Rating Master Scale) and the external
ratings of the international rating agencies:
Internal risk grade (*)
External ratings
Fitch
S&P
Moody's
DBRS
101
AAA
AAA
Aaa
AAA
102
AA+
AA+
Aa1
AA (high)
102
AA
AA
Aa2
AA
103
AA-
AA-
Aa3
AA (low)
103
A+
A+
A1
A (high)
104
A
A
A2
A
105
A-
A-
A3
A (low)
105
BBB+
BBB+
Baa1
BBB (high)
106
BBB
BBB
Baa2
BBB
107
BBB-
BBB-
Baa3
BBB (low)
108
BB+
BB+
Ba1
BB (high)
109
BB
BB
Ba2
BB
111
BB-
BB-
Ba3
BB (low)
112
B+
B+
B1
B (high)
114
B
B
B2
B
115
Lower B
Lower B
Lower B2
Lower B
(*) Customers with GR 110 and GR 113 correspond to BB- and B- from S&P, respectively, or another equivalent.
c) Impairment and Write-offs
The credit impairment calculation as at 31\u00a0December 2025 and 2024 integrates the general principles defined in
International Financial Reporting Standards (IFRS 9) and the guidelines issued by the Banco de Portugal through
Circular Letter CC/2018/00000062, in order to align the calculation process used in the Group with the best
international practices in this area.
As at 31\u00a0December 2025, the financial instruments subject to impairment requirements under IFRS 9, (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2025
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,914
829
\u2014
\u2014
861,743
Loans and advances to customers (note 22)
50,871,677
6,376,942
1,449,026
24,855
58,722,500
Debt instruments (note 23)
24,052,457
605,864
35,879
\u2014
24,694,200
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
1,183
\u2014
16,016,415
Guarantees and other commitments (note 46) (**)
16,256,245
1,682,805
311,324
861
18,251,235
Total
107,973,881
8,749,084
1,797,412
25,716
118,546,093
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
(Thousands of euros)
Category
2025
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
488
10
\u2014
\u2014
498
Loans and advances to customers (note 22)
252,249
296,302
759,614
7,660
1,315,825
Debt instruments (note 23)
28,878
92,651
33,796
\u2014
155,325
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,183
\u2014
1,183
Guarantees and other commitments (note 39)
30,425
23,353
92,378
\u2014
146,156
Total
312,040
412,316
886,971
7,660
1,618,987
(Thousands of euros)
Category
2025
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
860,426
819
\u2014
\u2014
861,245
Loans and advances to customers (note 22)
50,619,428
6,080,640
689,412
17,195
57,406,675
Debt instruments (note 23)
24,023,579
513,213
2,083
\u2014
24,538,875
Debt instruments at fair value through other
comprehensive income (note 24) (*)
15,932,588
82,644
\u2014
\u2014
16,015,232
Guarantees and other commitments (note 46) (**)
16,225,820
1,659,452
218,946
861
18,105,079
Total
107,661,841
8,336,768
910,441
18,056
116,927,106
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
As at 31\u00a0December 2024, the financial instruments subject to impairment requirements under IFRS 9 (do not
include equity instruments as accounting policy 1.C1.1.2), analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2024
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,647
\u2014
\u2014
\u2014
797,647
Loans and advances to customers (note 22)
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Debt instruments (note 23)
21,331,504
68,499
4,449
\u2014
21,404,452
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
1,169
\u2014
12,873,806
Guarantees and other commitments (note 46) (**)
15,758,606
1,197,255
322,087
2,790
17,280,738
Total
97,443,191
8,150,841
2,124,346
32,057
107,750,435
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments.
(Thousands of euros)
Category
2024
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
112
\u2014
\u2014
\u2014
112
Loans and advances to customers (note 22)
240,621
265,341
969,138
11,634
1,486,734
Debt instruments (note 23)
55,407
641
3,233
\u2014
59,281
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,169
\u2014
1,169
Guarantees and other commitments (note 39)
13,831
15,261
88,947
\u2014
118,039
Total
309,971
281,243
1,062,487
11,634
1,665,335
(Thousands of euros)
Category
2024
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
797,535
\u2014
\u2014
\u2014
797,535
Loans and advances to customers (note 22)
46,442,176
6,619,746
827,503
17,633
53,907,058
Debt instruments (note 23)
21,276,097
67,858
1,216
\u2014
21,345,171
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,872,637
\u2014
\u2014
\u2014
12,872,637
Guarantees and other commitments (note 46) (**)
15,744,775
1,181,994
233,140
2,790
17,162,699
Total
97,133,220
7,869,598
1,061,859
20,423
106,085,100
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit facilities and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as
follows:
(Thousands of euros)
2025
2024
Financial assets held for trading (note 24)
Debt instruments
791,310
1,259,178
Derivatives
168,266
404,252
Financial assets designated at fair value through profit or loss - Debt instruments (note
24)
\u2014
33,894
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
228,652
236,346
Hedging derivatives (note 25)
32,365
69,349
Total
1,220,593
2,003,019
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2025, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,682,797
6,885,087
1,796,641
29,267
55,393,792
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,391,263)
2,391,263
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(260,957)
\u2014
260,957
\u2014
\u2014
Transfers from stage 2 to stage 1
2,357,970
(2,357,970)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(356,580)
356,580
\u2014
\u2014
Transfers from stage 3 to stage 1
48,989
\u2014
(48,989)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
176,041
(176,041)
\u2014
\u2014
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
4,434,611
(360,315)
(676,956)
(2,470)
3,394,870
Gross amount at the end of the year
50,871,677
6,376,942
1,449,026
24,855
58,722,500
During 2025, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2025
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
240,621
265,341
969,138
11,634
1,486,734
Change in impairment losses:
Transfer to Stage 1
61,397
(51,481)
(9,864)
(52)
\u2014
Transfer to Stage 2
(19,960)
70,779
(50,819)
\u2014
\u2014
Transfer to Stage 3
(4,783)
(35,016)
40,066
(267)
\u2014
Changes occurred due to changes in credit risk
(54,671)
32,959
180,404
332
159,024
Write-offs
(470)
(584)
(63,166)
(1,942)
(66,162)
Changes due to new financial assets and
derecognised financial assets and other variations
30,115
14,304
(306,145)
(2,045)
(263,771)
Impairment losses at the end of the year
252,249
296,302
759,614
7,660
1,315,825
During 2024, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
45,651,670
7,290,622
1,914,768
30,749
54,887,809
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,071,117)
2,071,117
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(297,555)
\u2014
297,555
\u2014
\u2014
Transfers from stage 2 to stage 1
1,958,521
(1,958,521)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(420,581)
420,581
\u2014
\u2014
Transfers from stage 3 to stage 1
26,670
\u2014
(26,670)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
128,195
(128,195)
\u2014
\u2014
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Net balance of new financial assets and
derecognised financial assets and other variations
1,417,722
(222,759)
(591,235)
(14)
603,714
Gross amount at the end of the year
46,682,797
6,885,087
1,796,641
29,267
55,393,792
During 2024, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2024
Financial assets at amortised cost - Loans and advances to
customers impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
268,948
291,752
1,007,481
14,469
1,582,650
Change in impairment losses:
Transfer to Stage 1
63,989
(57,318)
(6,549)
(122)
\u2014
Transfer to Stage 2
(13,493)
45,311
(31,818)
\u2014
\u2014
Transfer to Stage 3
(5,250)
(40,730)
46,185
(205)
\u2014
Changes occurred due to changes in credit risk
(98,325)
19,729
240,744
979
163,127
Write-offs
(3,114)
(2,986)
(90,163)
(1,468)
(97,731)
Changes due to new financial assets and derecognised
financial assets and other variations
27,866
9,583
(196,742)
(2,019)
(161,312)
Impairment losses at the end of the year
240,621
265,341
969,138
11,634
1,486,734
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based
on expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2025
2024
Amortised cost before changes
224,554
235,601
Impairment losses before changes
52,857
31,971
Net amortised cost before changes
277,411
267,572
Net gain/loss arising on changes
(9,097)
(5,338)
Net amortised cost after changes
268,314
262,234
The financial assets changed since the initial recognition at a time when the impairment loss was measured based
on the expected credit losses lifetime, are analysed as follows:
(Thousands of euros)
Financial assets changed
2025
2024
Amortised cost of financial assets for which credit losses expected to go from \"lifetime\" to
12 months
65,180
71,287
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
27,912,683
1,724,254
164,858
63,735
1,952,847
243,962
133,169
377,131
8,151
30,250,812
Individuals-Other
10,293,222
1,112,561
119,694
47,582
1,279,837
179,123
312,892
492,015
8,562
12,073,636
Financial Companies
3,469,121
471,063
1,889
34
472,986
14,565
2,213
16,778
\u2014
3,958,885
Non-financial companies -
Corporate
9,556,611
1,010,324
12,425
1,096
1,023,845
139,011
53,567
192,578
117
10,773,151
Non-financial companies -
SME-Corporate
9,378,672
1,782,468
11,756
12,078
1,806,302
315,449
119,290
434,739
5,900
11,625,613
Non-financial companies -
SME-Retail
7,169,460
1,178,965
94,826
25,340
1,299,131
128,889
117,746
246,635
2,986
8,718,212
Non-financial companies -
Other
3,172,509
33,787
\u2014
\u2014
33,787
31,431
4,922
36,353
\u2014
3,242,649
Other loans
21,089,015
709,238
\u2014
88,467
797,705
\u2014
\u2014
\u2014
\u2014
21,886,720
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Individuals-Mortgages
9,111
16,736
4,302
3,328
24,366
72,363
46,612
118,975
3,575
156,027
Individuals-Other
82,776
66,824
18,745
13,697
99,266
84,033
220,900
304,933
4,085
491,060
Financial Companies
17,774
6,690
92
2
6,784
12,651
1,120
13,771
\u2014
38,329
Non-financial companies -
Corporate
41,456
32,864
414
72
33,350
72,516
25,273
97,789
\u2014
172,595
Non-financial companies -
SME-Corporate
62,270
63,127
746
1,574
65,447
139,954
75,533
215,487
\u2014
343,204
Non-financial companies -
SME-Retail
70,155
58,625
6,371
4,240
69,236
46,642
54,102
100,744
\u2014
240,135
Non-financial companies -
Other
11,301
466
\u2014
\u2014
466
29,384
4,705
34,089
\u2014
45,856
Other loans
17,197
94,751
\u2014
18,650
113,401
\u2014
\u2014
\u2014
\u2014
130,598
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Individuals-Mortgages
27,903,572
1,707,518
160,556
60,407
1,928,481
171,599
86,557
258,156
4,576
30,094,785
Individuals-Other
10,210,446
1,045,737
100,949
33,885
1,180,571
95,090
91,992
187,082
4,477
11,582,576
Financial Companies
3,451,347
464,373
1,797
32
466,202
1,914
1,093
3,007
\u2014
3,920,556
Non-financial companies -
Corporate
9,515,155
977,460
12,011
1,024
990,495
66,495
28,294
94,789
117
10,600,556
Non-financial companies -
SME-Corporate
9,316,402
1,719,341
11,010
10,504
1,740,855
175,495
43,757
219,252
5,900
11,282,409
Non-financial companies -
SME-Retail
7,099,305
1,120,340
88,455
21,100
1,229,895
82,247
63,644
145,891
2,986
8,478,077
Non-financial companies -
Other
3,161,208
33,321
\u2014
\u2014
33,321
2,047
217
2,264
\u2014
3,196,793
Other loans
21,071,818
614,487
\u2014
69,817
684,304
\u2014
\u2014
\u2014
\u2014
21,756,122
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Individuals-Mortgages
0.03%
0.97%
2.61%
5.22%
1.25%
29.66%
35.00%
31.55%
43.86%
0.52%
Individuals-Other
0.80%
6.01%
15.66%
28.79%
7.76%
46.91%
70.60%
61.98%
47.71%
4.07%
Financial Companies
0.51%
1.42%
4.87%
5.88%
1.43%
86.86%
50.61%
82.08%
0.00%
0.97%
Non-financial companies -
Corporate
0.43%
3.25%
3.33%
6.57%
3.26%
52.17%
47.18%
50.78%
0.00%
1.60%
Non-financial companies -
SME-Corporate
0.66%
3.54%
6.35%
13.03%
3.62%
44.37%
63.32%
49.57%
0.00%
2.95%
Non-financial companies -
SME-Retail
0.98%
4.97%
6.72%
16.73%
5.33%
36.19%
45.95%
40.85%
0.00%
2.75%
Non-financial companies -
Other
0.36%
1.38%
0.00%
0.00%
1.38%
93.49%
95.59%
93.77%
0.00%
1.41%
Other loans
0.08%
13.36%
0.00%
21.08%
14.22%
0.00%
0.00%
0.00%
0.00%
0.60%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgages
25,410,533
2,531,556
198,053
85,589
2,815,198
284,617
162,464
447,081
10,005
28,682,817
Individuals-Other
9,297,921
1,181,727
126,969
52,644
1,361,340
239,235
327,737
566,972
11,793
11,238,026
Financial Companies
3,450,266
40,675
5
17
40,697
13,035
15
13,050
\u2014
3,504,013
Non-financial companies -
Corporate
11,151,305
716,267
6,363
49
722,679
159,996
39,604
199,600
5,226
12,078,810
Non-financial companies -
SME-Corporate
9,034,618
1,762,243
22,710
9,089
1,794,042
499,686
122,876
622,562
1,605
11,452,827
Non-financial companies -
SME-Retail
6,524,804
1,077,758
31,069
21,154
1,129,981
117,188
155,779
272,967
3,428
7,931,180
Non-financial companies -
Other
548,529
21,754
\u2014
\u2014
21,754
\u2014
500
500
\u2014
570,783
Other loans
19,152,578
263,254
335
1,561
265,150
445
\u2014
445
\u2014
19,418,173
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Individuals-Mortgages
11,712
24,030
4,054
3,446
31,530
66,785
57,269
124,054
4,482
171,778
Individuals-Other
61,763
56,698
19,156
12,863
88,717
104,205
228,644
332,849
6,883
490,212
Financial Companies
21,558
2,072
1
2
2,075
12,448
9
12,457
\u2014
36,090
Non-financial companies -
Corporate
41,412
20,142
34
4
20,180
90,639
18,505
109,144
269
171,005
Non-financial companies -
SME-Corporate
41,250
56,922
3,852
2,204
62,978
283,615
56,392
340,007
\u2014
444,235
Non-financial companies -
SME-Retail
79,907
64,710
3,220
3,252
71,182
72,307
70,111
142,418
\u2014
293,507
Non-financial companies -
Other
651
27
\u2014
\u2014
27
\u2014
272
272
\u2014
950
Other loans
51,718
4,260
14
280
4,554
117
\u2014
117
\u2014
56,389
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Individuals-Mortgages
25,398,821
2,507,526
193,999
82,143
2,783,668
217,832
105,195
323,027
5,523
28,511,039
Individuals-Other
9,236,158
1,125,029
107,813
39,781
1,272,623
135,030
99,093
234,123
4,910
10,747,814
Financial Companies
3,428,708
38,603
4
15
38,622
587
6
593
\u2014
3,467,923
Non-financial companies -
Corporate
11,109,893
696,125
6,329
45
702,499
69,357
21,099
90,456
4,957
11,907,805
Non-financial companies -
SME-Corporate
8,993,368
1,705,321
18,858
6,885
1,731,064
216,071
66,484
282,555
1,605
11,008,592
Non-financial companies -
SME-Retail
6,444,897
1,013,048
27,849
17,902
1,058,799
44,881
85,668
130,549
3,428
7,637,673
Non-financial companies -
Other
547,878
21,727
\u2014
\u2014
21,727
\u2014
228
228
\u2014
569,833
Other loans
19,100,860
258,994
321
1,281
260,596
328
\u2014
328
\u2014
19,361,784
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Individuals-Mortgages
0.05%
0.95%
2.05%
4.03%
1.12%
23.46%
35.25%
27.75%
44.80%
0.60%
Individuals-Other
0.66%
4.80%
15.09%
24.43%
6.52%
43.56%
69.76%
58.71%
58.37%
4.36%
Financial Companies
0.62%
5.09%
20.00%
11.76%
5.10%
95.50%
60.00%
95.46%
0.00%
1.03%
Non-financial companies -
Corporate
0.37%
2.81%
0.53%
8.16%
2.79%
56.65%
46.73%
54.68%
5.15%
1.42%
Non-financial companies -
SME-Corporate
0.46%
3.23%
16.96%
24.25%
3.51%
56.76%
45.89%
54.61%
0.00%
3.88%
Non-financial companies -
SME-Retail
1.22%
6.00%
10.36%
15.37%
6.30%
61.70%
45.01%
52.17%
0.00%
3.70%
Non-financial companies -
Other
0.12%
0.12%
0.00%
0.00%
0.12%
0.00%
54.40%
54.40%
0.00%
0.17%
Other loans
0.27%
1.62%
4.18%
17.94%
1.72%
26.29%
0.00%
26.29%
0.00%
0.29%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past
due <=
30 days
Days
past
due >
30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Loans to individuals
38,205,905
2,836,815
284,552
111,317
3,232,684
423,085
446,061
869,146
16,713
42,324,448
Non-financial companies -
Trade
5,761,596
825,034
16,753
7,939
849,726
63,983
60,891
124,874
594
6,736,790
Non-financial companies -
Construction
3,025,258
491,950
13,816
3,764
509,530
226,993
31,456
258,449
640
3,793,877
Non-financial companies -
Manufacturing industries
5,898,525
866,217
17,949
4,764
888,930
137,782
125,158
262,940
4,712
7,055,107
Non-financial companies -
Other activities
2,503,502
308,930
6,024
1,650
316,604
17,510
12,076
29,586
16
2,849,708
Non-financial companies -
Other services
12,088,371
1,513,413
64,465
20,397
1,598,275
168,512
65,944
234,456
3,041
13,924,143
Other Services /Other
activities
24,558,136
1,180,301
1,889
88,501
1,270,691
14,565
2,213
16,778
\u2014
25,845,605
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment losses
Loans to individuals
91,887
83,560
23,047
17,025
123,632
156,396
267,512
423,908
7,660
647,087
Non-financial companies -
Trade
32,237
27,470
1,207
1,323
30,000
23,077
26,655
49,732
\u2014
111,969
Non-financial companies -
Construction
16,448
11,203
1,106
690
12,999
80,248
16,689
96,937
\u2014
126,384
Non-financial companies -
Manufacturing industries
44,103
40,034
946
701
41,681
87,029
78,428
165,457
\u2014
251,241
Non-financial companies -
Other activities
12,409
12,921
303
265
13,489
7,860
6,927
14,787
\u2014
40,685
Non-financial companies -
Other services
79,985
63,454
3,969
2,907
70,330
90,282
30,914
121,196
\u2014
271,511
Other Services /Other
activities
34,971
101,441
92
18,652
120,185
12,651
1,120
13,771
\u2014
168,927
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Loans to individuals
38,114,018
2,753,255
261,505
94,292
3,109,052
266,689
178,549
445,238
9,053
41,677,361
Non-financial companies -
Trade
5,729,359
797,564
15,546
6,616
819,726
40,906
34,236
75,142
594
6,624,821
Non-financial companies -
Construction
3,008,810
480,747
12,710
3,074
496,531
146,745
14,767
161,512
640
3,667,493
Non-financial companies -
Manufacturing industries
5,854,422
826,183
17,003
4,063
847,249
50,753
46,730
97,483
4,712
6,803,866
Non-financial companies -
Other activities
2,491,093
296,009
5,721
1,385
303,115
9,650
5,149
14,799
16
2,809,023
Non-financial companies -
Other services
12,008,386
1,449,959
60,496
17,490
1,527,945
78,230
35,030
113,260
3,041
13,652,632
Other Services /Other
activities
24,523,165
1,078,860
1,797
69,849
1,150,506
1,914
1,093
3,007
\u2014
25,676,678
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment coverage
Loans to individuals
0.24%
2.95%
8.10%
15.29%
3.82%
36.97%
59.97%
48.77%
45.83%
1.53%
Non-financial companies -
Trade
0.56%
3.33%
7.20%
16.66%
3.53%
36.07%
43.77%
39.83%
0.00%
1.66%
Non-financial companies -
Construction
0.54%
2.28%
8.01%
18.33%
2.55%
35.35%
53.06%
37.51%
0.00%
3.33%
Non-financial companies -
Manufacturing industries
0.75%
4.62%
5.27%
14.71%
4.69%
63.16%
62.66%
62.93%
0.00%
3.56%
Non-financial companies -
Other activities
0.50%
4.18%
5.03%
16.06%
4.26%
44.89%
57.36%
49.98%
0.00%
1.43%
Non-financial companies -
Other services
0.66%
4.19%
6.16%
14.25%
4.40%
53.58%
46.88%
51.69%
0.00%
1.95%
Other Services /Other
activities
0.14%
8.59%
4.87%
21.08%
9.46%
86.86%
50.61%
82.08%
0.00%
0.65%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit losses and
revocable commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
34,708,454
3,713,283
325,022
138,233
4,176,538
523,852
490,201
1,014,053
21,798
39,920,843
Non-financial companies -
Trade
5,416,938
657,638
8,559
7,002
673,199
53,917
61,395
115,312
4,560
6,210,009
Non-financial companies -
Construction
2,670,497
394,218
6,546
4,854
405,618
248,140
36,340
284,480
2,155
3,362,750
Non-financial companies -
Manufacturing industries
5,483,661
794,421
14,995
6,037
815,453
146,620
82,064
228,684
924
6,528,722
Non-financial companies -
Other activities
2,345,455
305,401
3,469
2,144
311,014
23,924
16,458
40,382
104
2,696,955
Non-financial companies -
Other services
11,342,705
1,426,344
26,573
10,255
1,463,172
304,269
122,502
426,771
2,516
13,235,164
Other Services /Other
activities
22,602,844
303,929
340
1,578
305,847
13,480
15
13,495
\u2014
22,922,186
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment losses
Loans to individuals
73,475
80,728
23,210
16,309
120,247
170,990
285,913
456,903
11,365
661,990
Non-financial companies -
Trade
32,985
20,550
1,229
1,136
22,915
17,823
25,364
43,187
269
99,356
Non-financial companies -
Construction
12,726
7,819
1,011
1,247
10,077
113,102
18,993
132,095
\u2014
154,898
Non-financial companies -
Manufacturing industries
39,131
44,277
2,740
1,235
48,252
49,740
40,350
90,090
\u2014
177,473
Non-financial companies -
Other activities
8,248
14,122
291
540
14,953
9,519
9,738
19,257
\u2014
42,458
Non-financial companies -
Other services
70,130
55,033
1,835
1,302
58,170
256,377
50,835
307,212
\u2014
435,512
Other Services /Other
activities
73,276
6,332
15
282
6,629
12,565
9
12,574
\u2014
92,479
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Loans to individuals
34,634,979
3,632,555
301,812
121,924
4,056,291
352,862
204,288
557,150
10,433
39,258,853
Non-financial companies -
Trade
5,383,953
637,088
7,330
5,866
650,284
36,094
36,031
72,125
4,291
6,110,653
Non-financial companies -
Construction
2,657,771
386,399
5,535
3,607
395,541
135,038
17,347
152,385
2,155
3,207,852
Non-financial companies -
Manufacturing industries
5,444,530
750,144
12,255
4,802
767,201
96,880
41,714
138,594
924
6,351,249
Non-financial companies -
Other activities
2,337,207
291,279
3,178
1,604
296,061
14,405
6,720
21,125
104
2,654,497
Non-financial companies -
Other services
11,272,575
1,371,311
24,738
8,953
1,405,002
47,892
71,667
119,559
2,516
12,799,652
Other Services /Other
activities
22,529,568
297,597
325
1,296
299,218
915
6
921
\u2014
22,829,707
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment coverage
Loans to individuals
0.21%
2.17%
7.14%
11.80%
2.88%
32.64%
58.33%
45.06%
52.14%
1.66%
Non-financial companies -
Trade
0.61%
3.12%
14.36%
16.22%
3.40%
33.06%
41.31%
37.45%
5.90%
1.60%
Non-financial companies -
Construction
0.48%
1.98%
15.44%
25.69%
2.48%
45.58%
52.26%
46.43%
0.00%
4.61%
Non-financial companies -
Manufacturing industries
0.71%
5.57%
18.27%
20.46%
5.92%
33.92%
49.17%
39.39%
0.00%
2.72%
Non-financial companies -
Other activities
0.35%
4.62%
8.39%
25.19%
4.81%
39.79%
59.17%
47.69%
0.00%
1.57%
Non-financial companies -
Other services
0.62%
3.86%
6.91%
12.70%
3.98%
84.26%
41.50%
71.99%
0.00%
3.29%
Other Services /Other
activities
0.32%
2.08%
4.41%
17.87%
2.17%
93.21%
60.00%
93.18%
0.00%
0.40%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025 , financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2025
Stage 2
Stage 3
Geography
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30 days
Total
Days
past due
<= 90
days
Days
past due
> 90 days
Total
POCI
Total
Gross Exposure
Portugal
64,304,554
5,796,075
166,462
77,972
6,040,509
712,242
333,631
1,045,873
16,598
71,407,534
Poland
26,613,257
1,432,010
234,829
67,639
1,734,478
333,419
384,880
718,299
9,118
29,075,152
Mozambique
1,123,482
794,575
4,157
92,721
891,453
6,769
25,288
32,057
\u2014
2,046,992
Total
92,041,293
8,022,660
405,448
238,332
8,666,440
1,052,430
743,799
1,796,229
25,716
102,529,678
Impairment
Portugal
196,675
190,342
8,916
8,956
208,214
315,589
172,412
488,001
\u2014
892,890
Poland
109,034
53,120
21,033
13,097
87,250
138,838
240,733
379,571
7,660
583,515
Mozambique
6,331
96,621
721
19,510
116,852
3,116
15,100
18,216
\u2014
141,399
Total
312,040
340,083
30,670
41,563
412,316
457,543
428,245
885,788
7,660
1,617,804
Net exposure
Portugal
64,107,879
5,605,733
157,546
69,016
5,832,295
396,653
161,219
557,872
16,598
70,514,644
Poland
26,504,223
1,378,890
213,796
54,542
1,647,228
194,581
144,147
338,728
1,458
28,491,637
Mozambique
1,117,151
697,954
3,436
73,211
774,601
3,653
10,188
13,841
\u2014
1,905,593
Total
91,729,253
7,682,577
374,778
196,769
8,254,124
594,887
315,554
910,441
18,056
100,911,874
% of impairment
coverage
Portugal
0.31%
3.28%
5.36%
11.49%
3.45%
44.31%
51.68%
46.66%
0.00%
1.25%
Poland
0.41%
3.71%
8.96%
19.36%
5.03%
41.64%
62.55%
52.84%
84.01%
2.01%
Mozambique
0.56%
12.16%
17.34%
21.04%
13.11%
46.03%
59.71%
56.82%
0.00%
6.91%
Total
0.34%
4.24%
7.56%
17.44%
4.76%
43.47%
57.58%
49.31%
29.79%
1.58%
As at 31\u00a0December 2024, financial assets at amortised cost, guarantees granted, irrevocable credit facilities and
revocable commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2024
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
58,473,777
5,846,367
216,085
102,395
6,164,847
918,541
356,047
1,274,588
13,881
65,927,093
Poland
24,622,516
1,380,971
160,546
61,255
1,602,772
391,388
420,892
812,280
18,176
27,055,744
Mozambique
1,474,261
367,896
8,873
6,453
383,222
4,273
32,036
36,309
\u2014
1,893,792
Total
84,570,554
7,595,234
385,504
170,103
8,150,841
1,314,202
808,975
2,123,177
32,057
94,876,629
Impairment
Portugal
184,443
174,794
11,245
9,943
195,982
473,433
146,705
620,138
\u2014
1,000,563
Poland
86,667
48,884
18,436
10,769
78,089
155,362
266,152
421,514
11,634
597,904
Mozambique
38,861
5,183
650
1,339
7,172
1,321
18,345
19,666
\u2014
65,699
Total
309,971
228,861
30,331
22,051
281,243
630,116
431,202
1,061,318
11,634
1,664,166
Net exposure
Portugal
58,289,334
5,671,573
204,840
92,452
5,968,865
445,108
209,342
654,450
13,881
64,926,530
Poland
24,535,849
1,332,087
142,110
50,486
1,524,683
236,026
154,740
390,766
6,542
26,457,840
Mozambique
1,435,400
362,713
8,223
5,114
376,050
2,952
13,691
16,643
\u2014
1,828,093
Total
84,260,583
7,366,373
355,173
148,052
7,869,598
684,086
377,773
1,061,859
20,423
93,212,463
% of impairment
coverage
Portugal
0.32%
2.99%
5.20%
9.71%
3.18%
51.54%
41.20%
48.65%
0.00%
1.52%
Poland
0.35%
3.54%
11.48%
17.58%
4.87%
39.70%
63.24%
51.89%
64.01%
2.21%
Mozambique
2.64%
1.41%
7.33%
20.75%
1.87%
30.92%
57.26%
54.16%
0.00%
3.47%
Total
0.37%
3.01%
7.87%
12.96%
3.45%
47.95%
53.30%
49.99%
36.29%
1.75%
As at 31\u00a0December 2025, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2025
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
61,696,215
9,954,383
2,363,743
6,717
1,763,989
75,785,047
281,615
75,503,432
stage 2
1,226,273
2,864,442
2,112,262
335,072
445,587
6,983,636
388,963
6,594,673
stage 3
400
1,559
398
1,462,354
20,194
1,484,905
793,411
691,494
POCI
3,191
2,339
1,865
17,460
1
24,856
7,660
17,196
62,926,079
12,822,723
4,478,268
1,821,603
2,229,771
84,278,444
1,471,649
82,806,795
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
13,388,007
5,017
\u2014
\u2014
2,539,564
15,932,588
\u2014
15,932,588
stage 2
7,702
74,942
\u2014
\u2014
\u2014
82,644
\u2014
15,932,588
stage 3
\u2014
\u2014
\u2014
\u2014
1,183
1,183
1,183
\u2014
13,395,709
79,959
\u2014
\u2014
2,540,747
16,016,415
1,183
16,015,232
Guarantees and other
commitments (**)
stage 1
11,546,206
3,741,469
687,219
755
280,597
16,256,246
30,425
16,225,821
stage 2
485,675
402,580
410,615
17,358
366,576
1,682,804
23,353
1,659,451
stage 3
3
24
84
311,080
133
311,324
92,377
218,947
POCI
52
1
2
806
\u2014
861
\u2014
861
12,031,936
4,144,074
1,097,920
329,999
647,306
18,251,235
146,155
18,105,080
Total
88,353,724
17,046,756
5,576,188
2,151,602
5,417,824
118,546,094
1,618,987
116,927,107
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2024, the gross exposure, by type of financial instrument, internal rating and stage, is analysed
as follows:
(Thousands of euros)
2024
Gross Exposure
Higher
quality
Average
quality
Lower
quality
Procedural
RG
Not
classified
(without
risk grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
54,782,294
9,856,040
2,681,861
620
1,491,131
68,811,946
296,140
68,515,806
stage 2
1,781,656
2,210,946
2,208,958
427,453
324,574
6,953,587
265,982
6,687,605
stage 3
193
1,608
737
1,772,838
25,715
1,801,091
972,371
828,720
POCI
2,700
2,384
1,358
22,792
32
29,266
11,634
17,632
56,566,843
12,070,978
4,892,914
2,223,703
1,841,452
77,595,890
1,546,127
76,049,763
Debt instruments at fair
value through other
comprehensive income
(*)
stage 1
12,735,540
\u2014
\u2014
\u2014
137,096
12,872,636
\u2014
12,872,636
stage 3
\u2014
\u2014
\u2014
\u2014
1,169
1,169
1,169
\u2014
12,735,540
\u2014
\u2014
\u2014
138,265
12,873,805
1,169
12,872,636
Guarantees and other
commitments (**)
stage 1
11,380,949
3,218,006
785,001
3
374,649
15,758,608
13,831
15,744,777
stage 2
207,462
408,214
393,070
22,586
165,922
1,197,254
15,261
1,181,993
stage 3
3
19
\u2014
321,943
121
322,086
88,947
233,139
POCI
4
2
1
2,783
\u2014
2,790
\u2014
2,790
11,588,418
3,626,241
1,178,072
347,315
540,692
17,280,738
118,039
17,162,699
Total
80,890,801
15,697,219
6,070,986
2,571,018
2,520,409
107,750,433
1,665,335
106,085,098
Note: Higher quality (RG 101-107); Average quality (RG 108-111); Lower quality (RG 112-115); Procedural RG (RG 123/124/125).
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in
the accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit facilities and revocable commitments (note 46).
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
24,013
30,226,799
30,250,812
7,945
148,082
156,027
Individuals - Other
6,596
12,067,040
12,073,636
3,860
487,200
491,060
Financial Companies
13,833
3,945,052
3,958,885
12,986
25,343
38,329
Non-financial companies-Corporate
154,023
10,619,128
10,773,151
89,870
82,725
172,595
Non-financial companies-SME-
Corporate
261,218
11,364,395
11,625,613
162,761
180,443
343,204
Non-financial companies-SME-Retail
31,409
8,686,803
8,718,212
19,874
220,261
240,135
Non-financial companies-Other
36,352
3,206,297
3,242,649
34,090
11,766
45,856
Other loans
\u2014
21,886,720
21,886,720
\u2014
130,598
130,598
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by segment, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgages
28,581
28,654,236
28,682,817
9,285
162,493
171,778
Individuals - Other
8,130
11,229,896
11,238,026
4,839
485,373
490,212
Financial Companies
12,658
3,491,355
3,504,013
12,297
23,793
36,090
Non-financial companies-Corporate
184,831
11,893,979
12,078,810
102,207
68,798
171,005
Non-financial companies-SME-
Corporate
409,804
11,043,023
11,452,827
277,360
166,875
444,235
Non-financial companies -SME - Retail
32,522
7,898,658
7,931,180
61,815
231,692
293,507
Non-financial companies-Other
500
570,283
570,783
272
678
950
Other loans
\u2014
19,418,173
19,418,173
\u2014
56,389
56,389
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
30,609
42,293,839
42,324,448
11,805
635,282
647,087
Non-financial companies-Trade
40,995
6,695,795
6,736,790
22,484
89,485
111,969
Non-financial companies-Construction
154,347
3,639,530
3,793,877
70,384
56,000
126,384
Non-financial companies-Manufacturing
industry
155,378
6,899,729
7,055,107
122,836
128,405
251,241
Non-financial companies-Other activities
13,008
2,836,700
2,849,708
7,981
32,704
40,685
Non-financial companies-Other services
119,274
13,804,869
13,924,143
82,910
188,601
271,511
Other Services/Other activities
13,833
25,831,772
25,845,605
12,986
155,941
168,927
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by sector of activity are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
36,711
39,884,132
39,920,843
14,124
647,866
661,990
Non-financial companies-Trade
31,532
6,178,477
6,210,009
11,538
87,818
99,356
Non-financial companies-Construction
188,453
3,174,297
3,362,750
110,151
44,747
154,898
Non-financial companies-Manufacturing
industry
101,395
6,427,327
6,528,722
44,047
133,426
177,473
Non-financial companies-Other activities
18,033
2,678,922
2,696,955
11,909
30,549
42,458
Non-financial companies-Other services
288,244
12,946,920
13,235,164
264,009
171,503
435,512
Other Services/Other activities
12,658
22,909,528
22,922,186
12,297
80,182
92,479
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
As at 31\u00a0December 2025, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2025
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
387,544
71,019,990
71,407,534
279,596
613,294
892,890
Poland
127,879
28,947,273
29,075,152
45,469
538,046
583,515
Mozambique
12,021
2,034,971
2,046,992
6,321
135,078
141,399
Total
527,444
102,002,234
102,529,678
331,386
1,286,418
1,617,804
As at 31\u00a0December 2024, the financial assets at amortised cost, guarantees and other commitments subject to
individual and collective impairment, by geography, are presented in the following table:
(Thousands of euros)
2024
Gross Exposure
Impairment losses
Geography
Individual
Collective
Total
Individual
Collective
Total
Portugal
499,966
65,427,127
65,927,093
411,589
588,974
1,000,563
Poland
163,443
26,892,301
27,055,744
49,694
548,210
597,904
Mozambique
13,617
1,880,175
1,893,792
6,792
58,907
65,699
Total
677,026
94,199,603
94,876,629
468,075
1,196,091
1,664,166
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to
individual analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31\u00a0December 2025, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2025
Year of production
Construction
and Commercial
Real Estate
Companies -
Other Activities
Mortgages
Individuals -
Other
Other
loans
Total
2015 and previous
Number of operations
13,971
32,750
229,682
683,541
421
960,365
Amount (EUR '000)
849,839
3,557,234
7,093,943
1,369,473
239,846
13,110,335
Impairment constituted (EUR '000)
70,756
65,253
84,077
29,715
2,295
252,096
2016
Number of operations
1,576
6,487
8,800
81,234
58
98,155
Amount (EUR '000)
89,734
861,158
411,126
167,116
2,443
1,531,577
Impairment constituted (EUR '000)
1,621
8,371
4,652
8,090
78
22,812
2017
Number of operations
1,885
7,260
14,310
91,995
318
115,768
Amount (EUR '000)
91,755
727,192
788,409
185,226
4,601
1,797,183
Impairment constituted (EUR '000)
4,169
10,994
6,887
10,374
302
32,726
2018
Number of operations
3,289
10,303
19,282
167,005
198
200,077
Amount (EUR '000)
303,634
1,550,329
1,219,319
356,944
170,361
3,600,587
Impairment constituted (EUR '000)
7,212
24,450
9,317
20,830
564
62,373
2019
Number of operations
5,093
12,111
21,941
389,036
177
428,358
Amount (EUR '000)
237,398
1,380,556
1,484,350
671,144
8,735
3,782,183
Impairment constituted (EUR '000)
4,723
24,536
8,693
35,051
287
73,290
2020
Number of operations
5,377
18,124
26,702
145,489
167
195,859
Amount (EUR '000)
309,033
1,375,805
1,843,019
313,927
13,884
3,855,668
Impairment constituted (EUR '000)
12,140
16,869
9,681
23,568
941
63,199
2021
Number of operations
6,109
21,032
38,974
193,999
214
260,328
Amount (EUR '000)
336,007
1,636,125
2,994,728
501,631
158,365
5,626,856
Impairment constituted (EUR '000)
5,249
24,429
11,922
42,987
1,604
86,191
2022
Number of operations
7,038
24,377
28,074
287,516
234
347,239
Amount (EUR '000)
605,074
2,284,241
2,546,466
807,341
20,258
6,263,380
Impairment constituted (EUR '000)
5,901
26,408
7,007
54,936
1,033
95,285
2023
Number of operations
8,584
29,671
25,183
391,892
489
455,819
Amount (EUR '000)
1,033,572
2,537,056
2,463,206
1,063,457
69,089
7,166,380
Impairment constituted (EUR '000)
12,566
38,288
5,104
65,701
569
122,228
2024
Number of operations
10,454
35,689
35,879
543,138
1,691
626,851
Amount (EUR '000)
1,379,732
3,879,212
4,040,851
1,805,476
124,652
11,229,923
Impairment constituted (EUR '000)
13,881
73,252
5,941
78,432
793
172,299
2025
Number of operations
16,372
73,191
38,659
1,416,963
1,305
1,546,490
Amount (EUR '000)
2,584,307
9,782,219
5,520,407
3,949,943
132,075
21,968,951
Impairment constituted (EUR '000)
23,594
243,815
5,524
71,902
2,468
347,303
Total
Number of operations
79,748
270,995
487,486
4,391,808
5,272
5,235,309
Amount (EUR '000)
7,820,085
29,571,127
30,405,824
11,191,678
944,309
79,933,023
Impairment constituted (EUR '000)
161,812
556,665
158,805
441,586
10,934
1,329,802
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
As at 31\u00a0December 2024, the following table includes the loans portfolio (including guarantees and commitments)
by segment and by year of production (date of the beginning of the operations, in the portfolio at the date of
balance sheet - it does not include restructured loans):
2024
Year of production
Construction
and Commercial
Real Estate
Companies -
Other
Activities
Mortgages
Individuals -
Other
Other
loans
Total
2014 and previous
Number of operations
14,156
29,534
252,970
668,544
730
965,934
Amount (EUR '000)
896,754
3,183,643
7,756,515
1,305,814
254,286
13,397,012
Impairment constituted (EUR '000)
78,530
52,663
100,158
27,346
1,621
260,318
2015
Number of operations
1,581
6,354
8,748
76,703
161
93,547
Amount (EUR '000)
84,592
497,077
407,678
134,673
2,955
1,126,975
Impairment constituted (EUR '000)
1,495
18,949
5,031
7,484
533
33,492
2016
Number of operations
1,807
7,290
9,811
98,126
173
117,207
Amount (EUR '000)
118,163
946,970
468,327
182,369
2,472
1,718,301
Impairment constituted (EUR '000)
1,595
10,080
5,726
12,138
145
29,684
2017
Number of operations
2,191
8,306
16,035
108,278
556
135,366
Amount (EUR '000)
121,934
792,998
903,737
204,274
5,942
2,028,885
Impairment constituted (EUR '000)
4,756
13,468
7,472
14,679
326
40,701
2018
Number of operations
3,880
12,010
21,342
195,982
357
233,571
Amount (EUR '000)
348,049
1,717,047
1,385,196
426,990
291,719
4,169,001
Impairment constituted (EUR '000)
5,185
18,602
9,535
30,198
878
64,398
2019
Number of operations
6,077
15,879
24,524
437,421
312
484,213
Amount (EUR '000)
379,403
1,390,533
1,701,878
816,725
50,025
4,338,564
Impairment constituted (EUR '000)
5,390
38,613
8,242
50,635
851
103,731
2020
Number of operations
7,221
25,512
29,793
205,882
355
268,763
Amount (EUR '000)
557,772
1,983,167
2,115,840
445,438
43,465
5,145,682
Impairment constituted (EUR '000)
12,161
33,067
9,626
32,906
1,620
89,380
2021
Number of operations
8,038
27,455
43,540
254,064
365
333,462
Amount (EUR '000)
554,664
1,927,360
3,439,789
728,043
284,772
6,934,628
Impairment constituted (EUR '000)
8,245
36,582
11,137
58,648
1,782
116,394
2022
Number of operations
8,953
30,755
31,844
394,452
443
466,447
Amount (EUR '000)
1,011,708
3,225,162
2,976,052
1,183,881
48,900
8,445,703
Impairment constituted (EUR '000)
10,394
49,175
5,672
72,621
1,548
139,410
2023
Number of operations
10,212
33,388
29,257
608,249
723
681,829
Amount (EUR '000)
1,480,507
2,773,296
2,970,331
1,716,879
96,858
9,037,871
Impairment constituted (EUR '000)
16,315
40,737
4,197
74,391
933
136,573
2024
Number of operations
14,366
126,180
39,644
1,311,647
2,976
1,494,813
Amount (EUR '000)
2,029,470
6,918,957
4,568,010
3,397,754
298,452
17,212,643
Impairment constituted (EUR '000)
13,463
214,703
6,071
75,276
4,619
314,132
Total
Number of operations
78,482
322,663
507,508
4,359,348
7,151
5,275,152
Amount (EUR '000)
7,583,016
25,356,210
28,693,353
10,542,840
1,379,846
73,555,265
Impairment constituted (EUR '000)
157,529
526,639
172,867
456,322
14,856
1,328,213
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured
current account and factoring operations.
As at 31\u00a0December 2025, the following table includes the fair value of the collaterals by segments (not limited by
the value of the collateral) associated to the loan's portfolio:
2025
Construction and
Commercial Real Estate
Companies - Other Activities
Mortgages
Fair Value
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,917
10,176
8,226
74,749
414,650
165
Amount (EUR '000)
950,927
247,527
1,337,812
1,940,745
68,904,429
8,251
>= 0.5 M\u20ac and < 1 M\u20ac
Number
967
28
1,470
310
11,134
4
Amount (EUR '000)
677,703
18,302
1,022,382
205,451
7,119,495
2,845
>= 1 M\u20ac and < 5 M\u20ac
Number
857
28
1,162
226
1,638
\u2014
Amount (EUR '000)
1,732,967
58,427
2,273,194
438,883
2,590,652
\u2014
>= 5 M\u20ac and < 10 M\u20ac
Number
113
1
136
22
32
\u2014
Amount (EUR '000)
798,161
9,022
941,111
151,390
210,548
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
71
1
60
7
5
\u2014
Amount (EUR '000)
1,018,316
16,135
833,131
89,073
64,077
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
30
\u2014
44
2
2
\u2014
Amount (EUR '000)
876,246
\u2014
1,373,170
42,941
45,180
\u2014
>= 50 M\u20ac
Number
6
\u2014
15
4
\u2014
\u2014
Amount (EUR '000)
553,001
\u2014
1,266,400
926,307
\u2014
\u2014
Total Number
8,961
10,234
11,113
75,320
427,461
169
Total Amount (EUR '000)
6,607,321
349,413
9,047,200
3,794,790
78,934,381
11,096
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31\u00a0December 2024, the following table includes the fair value of the collaterals by segments (not limited by
the value of the collateral) associated to the loan's portfolio:
2024
Construction and
Commercial Real Estate
Companies - Other Activities
Mortgages
Fair Value
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
Real Estate (*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
7,421
10,402
8,695
72,842
435,269
197
Amount (EUR '000)
971,177
294,041
1,331,150
1,797,700
69,220,142
9,702
>= 0.5 M\u20ac and < 1 M\u20ac
Number
1,038
65
1,303
261
9,252
4
Amount (EUR '000)
716,107
43,049
900,825
174,655
5,923,481
2,532
>= 1 M\u20ac and < 5 M\u20ac
Number
760
57
1,068
192
1,389
\u2014
Amount (EUR '000)
1,603,016
110,727
2,143,924
375,273
2,170,247
\u2014
>= 5 M\u20ac and < 10 M\u20ac
Number
122
2
116
18
23
\u2014
Amount (EUR '000)
860,789
10,213
814,568
134,013
148,552
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
69
1
53
14
3
\u2014
Amount (EUR '000)
961,620
29,640
755,885
187,204
35,893
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
21
\u2014
40
3
2
\u2014
Amount (EUR '000)
609,676
\u2014
1,211,901
63,454
45,216
\u2014
>= 50 M\u20ac
Number
9
\u2014
14
4
\u2014
\u2014
Amount (EUR '000)
724,928
\u2014
1,069,731
879,137
\u2014
\u2014
Total Number
9,440
10,527
11,289
73,334
445,938
201
Total Amount (EUR '000)
6,447,313
487,670
8,227,984
3,611,436
77,543,531
12,234
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31\u00a0December 2025, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgages:
(Thousands of euros)
2025
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,694,782
312,789
53,621
56,044
<60%
27,348
1,619,072
239,394
29,348
22,896
>=60% and <80%
3,575
321,539
69,834
49,104
43,574
>=80% and <100%
1,036
154,519
19,377
3,404
4,666
>=100%
1,113
93,695
18,726
14,336
13,449
Companies - Other Activities
Without associated collateral
n.a.
11,597,146
1,496,792
294,073
453,770
<60%
49,352
2,036,606
427,181
82,466
45,882
>=60% and <80%
15,400
1,001,970
455,418
37,644
30,093
>=80% and <100%
9,328
690,982
110,772
21,601
16,917
>=100%
2,327
519,764
182,305
28,780
36,337
Mortgage loans
Without associated collateral
n.a.
85,965
2,546
6,807
10,999
<60%
369,342
15,555,903
1,034,322
283,388
119,717
>=60% and <80%
98,453
8,471,037
615,595
77,229
26,837
>=80% and <100%
28,582
3,605,064
289,596
31,808
12,817
>=100%
3,140
188,612
21,488
7,194
3,919
As at 31\u00a0December 2024, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgages:
(Thousands of euros)
2024
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,512,159
281,959
68,269
76,485
<60%
25,977
1,519,840
158,693
37,610
23,185
>=60% and <80%
3,506
362,009
51,182
31,307
15,650
>=80% and <100%
1,059
106,345
40,451
2,610
3,460
>=100%
1,135
94,340
21,947
38,149
32,810
Companies - Other Activities
Without associated collateral
n.a.
8,965,096
1,172,453
280,620
431,817
<60%
47,243
1,894,339
487,811
85,539
39,543
>=60% and <80%
14,091
816,960
390,644
49,399
30,333
>=80% and <100%
10,728
692,087
152,910
15,653
16,478
>=100%
2,065
459,238
165,964
183,867
167,306
Mortgage loans
Without associated collateral
n.a.
417,293
7,163
8,637
12,859
<60%
386,507
14,822,521
1,490,909
319,980
129,363
>=60% and <80%
102,038
7,652,552
897,507
104,596
26,597
>=80% and <100%
27,048
2,377,618
387,868
41,008
13,827
>=100%
3,636
134,446
41,043
11,792
6,137
As at 31\u00a0December 2025, the following table includes the fair value and the net book value of the properties
classified as Non-current assets held for sale (note 27) and as Other assets (note 32), by type of asset:
(Thousands of euros)
2025
Assets arising from
recovered loans results
Assets belonging to
investments funds and
real estate companies
Total
Asset
Appraised
value
Book value
Appraised
value (1)
Book value
Appraised
value
Book value
Land
Urban
38,398
17,708
58,729
58,729
97,127
76,437
Rural
1,365
924
2,463
2,463
3,828
3,387
Buildings under construction
Commercials
670
\u2014
\u2014
\u2014
670
\u2014
Mortgages
2,435
\u2014
\u2014
\u2014
2,435
\u2014
Constructed buildings
Commercials
22,455
12,919
\u2014
\u2014
22,455
12,919
Mortgages
19,706
16,562
\u2014
\u2014
19,706
16,562
Other
36,138
35,968
\u2014
\u2014
36,138
35,968
121,167
84,081
61,192
61,192
182,359
145,273
(1) Value deducted from haircuts or other applicable impairment
As at 31\u00a0December 2024, the following table includes the fair value and the net book value of the properties
classified as Non-current assets held for sale (note 27) and as Other assets (note 32), by type of asset:
(Thousands of euros)
2024
Assets arising from
recovered loans
Assets belonging to
investments funds and
real estate companies
Total
Asset
Appraised
value
Book value
Appraised
value (1)
Book value
Appraised
value
Book value
Land
Urban
54,050
25,840
60,855
60,855
114,905
86,695
Rural
1,459
735
2,853
2,853
4,312
3,588
Buildings under construction
Commercials
790
\u2014
\u2014
\u2014
790
\u2014
Mortgages
2,310
\u2014
\u2014
\u2014
2,310
\u2014
Constructed buildings
Commercials
17,380
9,573
\u2014
\u2014
17,380
9,573
Mortgages
38,903
29,227
\u2014
\u2014
38,903
29,227
Other
28,971
28,764
\u2014
\u2014
28,971
28,764
143,863
94,139
63,708
63,708
207,571
157,847
(1) Value deducted from haircuts or other applicable impairment
Credit Portfolio Monitoring Process
The Bank has in place a credit portfolio management and monitoring processes, namely with regard to the
assessment of the risk profile of the exposure in different portfolios/segments. These procedures have the purpose
of identifying and closely monitoring the customers potentially more affected by the prevailing macroeconomic
context, anticipating possible difficulties in complying the responsibilities and defining credit and performance
strategies adjusted to the specificities of each customer/group of customers, with a view to both maintaining
support to customers considered viable and mitigating credit risk in cases where there are risks of loss in the
exposure value.
The importance of this approach is underscored by the uncertainty that has marked activity in recent years, with
the current context highlighting the potential impacts resulting from multiple geopolitical conflicts, instability in
several key European countries, particularly in terms of political uncertainty, more modest economic growth and
budgetary pressures. Added to this context is the imposition of tariffs by the US on imports of goods originating in
the EU, with significant impacts on international trade and geopolitical alliances.
The main guidelines of the credit portfolio monitoring approach can be characterised as presented below:
- Global and transversal: Analysis of the entire credit portfolio of the Group, being excluded from the monitoring
process only customers with a better risk profile (in the case of retail) or with exposures of a lower size (in the case
of retail and corporate).
- Specialised: Monitoring by the Credit Division in coordination with the Rating Division and the Specialised
Recovery Division for the corporate segment and by the Credit Division and Retail Recovery Division for individuals
and small businesses.
- Segmented: Prioritisation of approach/analysis recurrence based on risk signs, in order to gather additional
information and agree on appropriate and sustainable financial restructuring solutions in a timely manner.
- Prospective: Use of predictive models, in order to anticipate potential future defaults, avoiding a reactive
approach.
- Standardised: Both in terms of risk models and monitoring, and in terms of credit solutions for which it is
possible to identify pre-defined alternatives (retail segments).
- Convenient and innovative: Making the restructuring journey simpler and more convenient both in terms of
credit solutions and channels, extending the restructuring offer to the App for consumer credit and mortgages.
Specifically in the corporate segment, the process of portfolio follow-up and monitoring can be generically
characterised as described below, having as a fundamental component the attribution of credit strategies, among
pre-defined options, with review periods differentiated according to the level of risk associated to the strategy
attributed:
1. Customer Assessment and presentation of Indicative Credit Strategy by the Rating Division (for customers with
ratings assigned by corporate rating models);
2. Approval, by the competent credit decision levels, of a credit strategy for each customer, taking into
consideration the Indicative Credit Strategy from the Rating Division, the information received from the area
that follows the customer and the inputs received as a result of the customer interaction process;
3. Decision, negotiation and formalisation of the operations that will ensure that the approved strategy is
pursued and the approved credit limits are met (Credit Division, Areas that follow the client and Operations
Division);
4. Monitoring the Credit Strategy and the evolution of the customer's activity (Credit Division and the Areas that
follow the customer);
5. Monitoring of the credit portfolio and effectiveness of the portfolio monitoring process and credit strategy
attribution (Risk Office), based on a set of KPIs, (e.g. percentage of the credit portfolio with valid risk strategy;
evolution of credit exposure to customers with a reduction strategy; adequacy of the credit strategy to the
customer's performance);
6. In the attribution of the customer's credit strategy, besides the intrinsic factors of the customer, more
transversal factors are taken into consideration, such as the evaluation of the sectorial risk (periodically
reviewed with the support of the Economic Studies Division) and taking into consideration the attribution of a
ESG rating regarding the customers with most relevant exposures;
7. The occurrence of effective and/or potential risk events (signs of default/delinquency; breach of contractual
covenants; severe alteration in sector risk; alteration in the corporate/shareholder structure), trigger an
extraordinary/anticipated revision of the strategy.
As part of this monitoring process and with an impact on other complementary procedures adopted, the Group
defines a list of sectors considered to be more vulnerable to the macroeconomic environment and climate
impacts, which is reviewed periodically (at least annually), supporting a set of reports on the evolution of the risk
profile of the exposures associated with these sectors.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCreditRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-725": { "value": "
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organised
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in
restructuring process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk
Grade of the customer by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better
than the customer\u2019s), when the protection is formalised through:
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis
and before decision process.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForCollateralExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-726": { "value": "
Market risk
Market risks represent potential losses arising from changes in interest or exchange rates and/or in the prices of
various financial instruments, considering account not only the correlations among these instruments but also
their respective volatilities.
For profitability analysis and for the quantification, monitoring and control of market risks, the following
management areas are defined for each Group entity:
- Trading: Management of positions aimed at achieving short-term gains through sale or revaluation. These
positions are actively managed, tradable without restrictions, and can be frequently and accurately valued.
These include securities and derivatives resulting from sales activities.
- Funding: Management of institutional funding (wholesale funding) and money market positions.
\u2013 Investment: Management of all positions in securities intended to be held to maturity or for an extended period,
as well as positions not tradable on liquid markets.
- Commercial: Management of positions arising from commercial activities with customers.
- Structural: Management of balance sheet items or operations which, due to their nature, are not directly related
to any of the management areas referred to above.
- ALM: Assets and Liabilities Management.
The definition of these management areas allows for an effective separation between the trading and banking
books, as well as a proper allocation of each transaction to the most appropriate management area, according to
its context and strategy.
To ensure that the risk levels incurred in the Group\u2019s portfolios align with predefined risk tolerance levels, various
market risk limits are established, at least on an annual basis, applicable to all portfolios of the relevant
management areas. These limits are monitored daily (or intra-daily, for financial market areas) by the Risk Office.
Stop-loss limits are also set for portfolios in the financial market areas \u2013 Trading and Funding \u2013 based on multiples
of the defined risk limits. The objective is to cap potential losses in these areas. If these limits are reached, a
mandatory review of the underlying business strategy and assumptions associated with the positions in question
is triggered.
Market risks of the prudential trading book (1)
For the daily measurement of generic market risk, which includes interest rate risk, exchange rate risk, equity risk
and the price risk of credit default swap (indices), the Group uses a Value-at-Risk (VaR) model, with a 10-business-
day time horizon and a 99% confidence level.
Additionally, the Group uses an integrated market risk measure that covers all relevant risk subtypes. This
measure incorporates generic, specific, non-linear and commodity risks. Each sub-type is measured individually
using appropriate risk models, and the integrated measure is calculated without considering any diversification
across the four subtypes (worst-case scenario approach).
For non-linear risk, the Group applies an internally developed methodology that replicates the effect of the main
non-linear elements of option positions on portfolio results, similar to the VaR approach, using the same time
horizon and confidence level.
Specific and commodity risks are measured using standard methodologies defined in applicable regulations, with
an appropriate adjustment of the time horizon.
The following table presents the amounts at risk for the Trading Book, measured using approaches described
above:
(Thousands of euros)
2025
Max of global risk
in the period
Min of global risk
in the period
2024
Generic Risk ( VaR )
503
3,016
485
488
Interest Rate Risk
366
1,811
318
310
FX Risk
232
1,500
255
275
Equity Risk
328
1,510
244
285
Diversification effects
(423)
(1,805)
(332)
(382)
Specific Risk
1
1
1
1
Non-Linear Risk
\u2014
\u2014
\u2014
\u2014
Commodities Risk
\u2014
\u2014
\u2014
\u2014
Global Risk
504
3,017
486
489
Several validation processes are conducted over time to ensure the internal VaR model is appropriate for
assessing the risk in the Group\u2019s positions, with different scopes and frequencies, including back testing,
diversification effects estimation, and analysis of the comprehensiveness of risk factors.
In addition to VaR, the Group continuously tests a broad range of stress scenarios, the results of which are
analysed to identify risk concentrations not captured by the VaR model.
(1) Trading Book - positions allocated to the Trading Management Area (and not specifically to the accounting trading book)
Interest rate risk
Interest rate risk from Banking Book operations is evaluated through a monthly risk sensitivity analysis, covering
all operations in the Group\u2019s consolidated Balance Sheet, categorised by exposure currency. Market interest rate
fluctuations impact the Group\u2019s net interest income in both the short- and long-term, as well as its economic
value.
Key sources of this risk include Repricing Risk, from timing mismatches in asset and liability repricing; Yield Curve
Risk, due to shifts in the interest rate environment affecting future cash flow valuations; Basis Risk, arising from
unequal variations in reference rates with the same repricing period; and Credit Spread Risk, reflecting changes in
credit spreads that impact asset and liability fair values.
Additionally, behavioural factors such as assumptions relating to deposits with no defined maturity, early
repayments of consumer and mortgages, and redemptions of term deposits contribute to Interest Rate Risk in
the Banking Book (IRRBB).
In order to identify the exposure of the Group's banking book to these risks, the monitoring of the interest rate risk
takes into consideration the financial characteristics of each of the relevant contracts, with the respective
expected cash-flows (principal and interest, without the spread component but including costs for liquidity,
capital, operational and other) being forecasted according to the repricing dates, thus allowing for the calculation
of the impact on economic value resulting from alternative scenarios of change of market interest rate curves.
The Group measures interest rate risk exposure using standardised sensitivity scenarios, typically assessing the
impact of parallel shifts of \u00b1100 and \u00b1200 basis points on the economic value of the Banking Book. These analyses
are complemented by the Supervisory Outlier Tests (SOTs), which assess exposure to IRRBB in the context of
SREP, identifying potential adverse impacts on EVE under shock scenarios.
The following tables show the expected impact on the banking book economic value of the Banking Book
resulting from parallel shifts in the yield curve by \u00b1100 and \u00b1200 basis points, for each of the main currencies in
which the Group holds material positions:
(Thousands of euros)
2025
Currency
- 200 bp (*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
13,384
6,589
(6,339)
(12,400)
EUR
(358,503)
(126,800)
37,901
16,341
PLN
188,824
119,038
(126,652)
(187,148)
USD
(16,743)
(7,575)
5,926
11,417
(173,038)
(8,748)
(89,164)
(171,790)
(*) Scenario of decreasing rates, limited to non-negative rates (which implies effective variations of lesser amplitude than 100 bp, especially in shorter
periods).
(Thousands of euros)
2024
Currency
- 200 bp (*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
3,734
1,668
(1,713)
(3,393)
EUR
(55,339)
(17,400)
(2,590)
(15,642)
PLN
157,210
69,159
(69,603)
(119,933)
USD
(16,628)
(8,178)
7,192
14,240
88,977
45,249
(66,714)
(124,728)
(*) Scenario of decreasing rates, limited to non-negative rates (which implies effective variations of lesser amplitude than 100 bp, especially in shorter
periods).
As described in accounting policy 1.B, the financial statements of the Group's subsidiaries and associates placed
abroad are prepared in their functional currency and translated into euro at the end of each financial period. The
exchange rates used for the conversion of balance sheet amounts in foreign currency are the ECB reference rates
at the end of each period. The conversion of results in foreign currency is calculated using average exchange rates
according to the closing exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
Balance sheet
Income statement
Currency
2025
2024
2025
2024
AOA
1,086.3720
955.3050
1,039.0178
954.9984
BRL
6.4430
6.3942
6.2834
5.8558
CHF
0.9304
0.9382
0.9361
0.9514
MOP
9.4141
8.2838
9.4141
8.2838
MZN
75.0650
65.9290
71.9105
68.9735
PLN
4.2228
4.2767
4.2361
4.3048
USD
1.1743
1.0355
1.1262
1.0819
", "dimensions": { "concept": "ifrs-full:DisclosureOfMarketRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-727": { "value": "
Foreign exchange and equity risk of the banking book
The foreign exchange risk of the banking book is internally transferred to the Trading area, in accordance with the
Group\u2019s risk specialisation model for management of foreign exchange risk on the balance sheet. Structural
foreign exchange exposures, including those resulting from interests in subsidiaries, are not transferred and may
be hedged using market operations, in accordance with the defined strategy for structural foreign exchange risk
management. This strategy aims at hedging against volatility in the CET1 ratio stemming from changes in
exchange rates.
As at 31 December 2025, the Group 's financial investments denominated in foreign currency were not hedged.
When such hedges exist, on a consolidated basis, these are identified as net investment hedge sunder IFRS
nomenclature. On an individual basis, they are designated as fair value hedges of the relevant investments. Gains
and losses on instruments used to hedge net investments in foreign institutions are recognised in foreign
exchange reserves and presented in the statement of comprehensive income.
The transfer of funds, including dividends, owed by BCP subsidiaries or associates in third countries, particularly
those outside the European Union, may be subject to restrictions and exchange controls that, at any given time,
are in force in the subsidiary\u2019s or associate\u2019s country of incorporation.
Regarding equity risk, the Group holds a limited number of low-risk positions, primarily within the investment
portfolio, mainly resulting from foreclosure or payment-in-kind processes. These positions are managed by a
specialised unit within the Group, with the associated risk monitored through metrics and limits set for market
risk control.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEffectOfChangesInForeignExchangeRatesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-728": { "value": "
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators set by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also fixed.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is
based on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are
calculated on a daily basis, taking into account the impact on the liquidity buffers available to discount with the
respective central banks at the reference date of future estimated cash flows for each of the respective time
horizon (3 days or 3 months) considering the set of transactions intermediated by the market areas, including
transactions carried out with Corporate and Private networks customers, which, due to their size, must be quoted
by the Trading Room. The remaining buffer in each time bucket is then compared to the amount of customer
deposits, being the indicators assessed against exposure limits defined in the Group's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis, identifying all
the factors that justify the variations that have occurred. This analysis is submitted to the Capital and Assets and
Liabilities Committee (CALCO) for appraisal, with a view to making decisions that lead to the maintenance of
financing conditions adequate to the business sustainability.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterise the Bank's risk profile and to ensure that the Group
and each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support
the liquidity contingency plan and management decisions.
The Group\u2019s liquidity position remained resilient throughout 2025, supported by a significant increase in on
balance sheet customer funds (+7.0% year-on-year on a consolidated basis), driven mainly by the strong
momentum of the Polish operation (+13,0%). Credit started a growth trend, rising by 7,3% at Group level, largely
fueled by the solid performance in Portugal (+9.3%). From a balance sheet perspective, the growth in on-balance
sheet funds once again exceeded that of loans, generating a liquidity surplus that supported the expansion of the
securities portfolio, which grew 15.0% at group level.
As a result, liquidity buffers held with central banks remained robust, increasing in the three main geographies.
Key regulatory and internal liquidity risk indicators continued to display comfortable levels.
As at 31 December 2025, with regard to short-term liquidity, the Liquidity Coverage Ratio (LCR) stood at 334% on a
consolidated basis, compared to 342% at the same date in the previous year, ensuring a comfortable buffer above
the minimum regulatory requirement of 100%.
From a structural perspective, the Group maintained its stable funding base, primarily supported by customer
deposits\u2014particularly in the retail segment\u2014and complemented by medium and long-term funding instruments,
namely issuances under the MREL framework and the Bank Millennium covered bond programme. As a result, as
at 31 December 2025, the Net Stable Funding Ratio (NSFR) reached 180%, broadly in line with the 181% recorded
one year earlier, thereby maintaining a substantial buffer above the minimum regulatory requirement of 100%.
The loan-to-deposit ratio stood at 68% at the end of December 2025, close to the ratio observed on the same date
the previous year., reflecting a prudent balance sheet management approach alongside the recovery of lending
activity in Portugal since the beginning of the year.
Following important rating upgrades since 2023, by the end of 2025 BCP\u2019s subordinated debt was assessed as
investment grade by S&P, Moody\u2019s and DBRS. From January 2025 the spread of BCP in Senior Preferred (\u201cSP\u201d) and
subordinated debt (\u201cT2\u201d) tightened materially, due not only to market conditions but also to the strong positive
BCP\u2019s intrinsic factors. During 2025, BCP executed three transactions in the wholesale market: on 20 March a EUR
500,000,000 12nc7 4,750% T2 Notes, to refinance the call-option on 27 March of the EUR 450,000,000 3,871%
10,5nc5,5 T2 Notes; at the same date the Bank launched a Tender Offer on BCP\u2019s EUR 166,000,000 6.888% 2027 T2
Notes which remained outstanding after the 2022 Exchange Offer, with valid tenders in an aggregate nominal
amount of EUR 79,500,000, and decided to accept for purchase all Notes validly tendered; on 24 June, a EUR
500,000,000 6NC5 3.125% SP Notes to refinance the exercise, on 2 October and also in favourable pricing
conditions, of the call-option on the EUR 500,000,000 5.625% SP Notes.
The liquidity buffer available with the ECB amounted to EUR 34,725,574,000 at the end of 2025, EUR 977,437,000
higher than one year earlier. At the end of 2025, the liquidity buffer included a long position of EUR 1,739,808,000
with the ECB.
Throughout 2025, in addition to increasing its deposit\u2019s base, Bank Millennium reinforced its structural liquidity
position through the execution of covered bond issuances of PLN 800,000,000 in March and PLN 1,000,000,000 in
November. As a result, the outstanding balance of the instrument reached PLN 2,600,000,000 as at December
2025.
Millennium Bim maintained during 2025 a robust liquidity position, based on the stability of its local deposits\u2019
base.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after
haircuts, is detailed as follows:
(Thousands of euros)
2025
2024
European Central Bank
14,965,278
15,437,781
Other Central Banks
13,676,940
10,001,379
28,642,218
25,439,160
The amount discounted with the Bank of Mozambique amounts to EUR 398,000 (31\u00a0December 2024: EUR
755,000). There are no discounted amounts with other central banks.
The evolution of the ECB\u2019s Monetary Policy Pool, of the net borrowings at the ECB and of the liquidity buffer is
analysed as follows:
(Thousands of euros)
2025
2024
Collateral eligible for ECB, after haircuts:
The pool of ECB monetary policy (i)
14,965,278
15,437,781
Outside the pool of ECB monetary policy
18,020,487
15,489,545
32,985,765
30,927,326
Net borrowing at the ECB (ii)
(1,739,808)
(2,820,810)
Liquidity buffer (iii)
34,725,573
33,748,136
i) Corresponds to the amount reported in ECMS (Banco de Portugal application).
ii) Includes as at 31 December 2025 the amount of deposits with the Banco de Portugal and other liquidity with the Eurosystem (EUR 2,296,690,000) in
excess over the minimum cash reserves (EUR 556,882,000).
iii) Eligible collateral available for discount with the ECB, after haircuts, deducted from the net funding at the ECB.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels
over the next years, with no material impact, considering the liquidity buffers of the issuing entities.
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk
Committee, the following information is presented in accordance with COMMISSION IMPLEMENTING
REGULATION (EU) 2024/3172 of 29 November 2024 supplementing Regulation (EU) No 575/2013 of the European
Parliament and of the Council with regard to regulatory technical standards for disclosure of encumbered and
unencumbered assets.
(Thousands of euros)
2025 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the reporting
institution
2,825,812
1,652,402
103,830,893
37,426,892
Equity instruments
\u2014
\u2014
\u2014
\u2014
347,486
\u2014
347,486
\u2014
Debt securities
1,652,402
1,652,402
1,610,693
1,610,693
38,711,751
33,438,423
38,728,409
33,370,929
of which: covered
bonds
\u2014
\u2014
\u2014
\u2014
386,650
386,650
386,650
386,650
of which:
securitisations
\u2014
\u2014
\u2014
\u2014
54
\u2014
54
\u2014
of which: issued by
general governments
1,652,402
1,652,402
1,610,693
1,610,693
30,381,782
29,704,706
30,253,269
29,561,544
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
2,432,641
1,117,197
2,440,508
1,123,302
of which: issued by
non-financial
corporations
\u2014
\u2014
\u2014
\u2014
3,855,996
621,978
3,902,142
621,978
Other assets
1,215,490
\u2014
64,853,304
4,011,894
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2025 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing
institution
\u2014
\u2014
542,931
101,958
Debt securities
\u2014
\u2014
451,288
101,958
of which: covered bonds
\u2014
\u2014
264,730
\u2014
of which: issued by general governments
\u2014
\u2014
101,958
101,958
of which: issued by financial corporations
\u2014
\u2014
329,161
\u2014
Loans and advances other than loans on
demand
\u2014
\u2014
90,831
\u2014
Own covered bonds and securitisations issued
and not yet pledged
9,180,214
\u2014
TOTAL COLLATERAL RECEIVED AND OWN
DEBT SECURITIES ISSUED
2,825,812
1,652,402
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
2025 (1)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered bonds
and securitisations encumbered
Carrying amount of selected financial
liabilities
1,295,122
1,702,554
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
At the end of December 2025, and according to the EBA methodology, the total encumbered assets represent 3%
of the Group's total balance sheet assets. Debt securities represents 58% of the total encumbered assets while
encumbered Loans to customers represents 34%.
The main sources of asset encumbrance in Portugal stem from repurchase agreement operations, collateral swap
operations, collateralisation of derivative operations and securitisation programs collateralised by certain Loans to
Customers\u2019 portfolios. Collateralisation of securitisation operations in Poland, derivatives central counterparty
clearing houses and other commitments with the Deposit Guarantee Fund, are primarily supported by eligible
sovereign debt held with the central bank of Poland.
On 31st December 2025, the Other assets includes unencumbered assets in the amount of EUR 3,144,521,000
related to Loans on demand, the amount of EUR 55,900,224,000 related to Loans and advances other than loans
on demand (of which encumbered assets in the amount of EUR 949,464,000) and the amount of EUR
6,060,596,000, mostly unencumbered and related to the Group\u2019s activity, namely: investments in associated
companies and subsidiaries, tangible assets and investment properties, intangible assets, assets associated with
derivatives and current and deferred taxes.
On 31st December 2025, BCP Group has a EUR 12.5 billion BCP Covered Bond Programme (\u201cBCP Programme\u201d)
with EUR 11.2 billion of covered bonds outstanding. The BCP Programme is backed by a EUR 13.4 billion portfolio of
residential mortgages, as well as by a liquidity buffer of EUR 50 million, totalling an over collateralisation of 20.0%,
which is above the minimum of 12.0% currently required by rating agencies.
The Portuguese covered bond legislation, under which the BCP Programme has been updated and authorised, in
2023, for the issuance of \u201cCovered Bonds (Premium)\u201d (label now born by all its outstanding covered bonds), affords
covered bond holders a dual-recourse, firstly over the issuer, secondly over the cover pool that may also include
other eligible assets, over which they benefit from a special preferential claim. The Portuguese covered bond
legislation ensures total segregation of the covered pool from any future issuer\u2019s insolvent estate, for the benefit of
covered bond holders, who have precedence over claims of any other of the issuer\u2019s creditors in case of issuer
insolvency, thus and to this extent superseding the general insolvency and recovery legislation. Residential
mortgages included in BCP Programme\u2019s cover pool are subject to certain eligibility criteria inscribed in the
Portuguese covered bond legislation, including a maximum LTV of 80%, delinquency of no more than 90 days,
and them being first lien mortgages (or, if otherwise, all preceding liens being in the cover pool) over properties
located in the EU. The BCP\u2019s Programme documentation limits the mortgaged properties\u2019 location to Portugal
only.
As regard Poland Covered Bonds, Millennium Bank Hipoteczny S.A. (\"MBH\") initiated operations on 14 June 2021,
with an initial capital of PLN 120 million, fully subscribed by Bank Millennium S.A. In 2024, MBH issued two covered
bonds with a five-year maturity, with the amounts of PLN 800 million and PLN 1,000 million. As of December 2025,
MBH's covered bonds have the highest possible AAA rating by Fitch Ratings.
MBH's covered bonds are secured by mortgage receivables under loans granted by the Bank and by Polish
government debt. These loans meet specific criteria, including being in PLN, intended for housing purposes,
having ownership titles with established mortgages in favor of Bank Millennium in the first place, no evidence of
impairment, and loan values lower than the mortgage lending value.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2025
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
Demand
Total
Assets
Cash and deposits at Central Banks
4,089,540
\u2014
\u2014
\u2014
\u2014
\u2014
4,089,540
Loans and advances to Credit
Institutions - Repayable on demand
186,011
\u2014
\u2014
\u2014
\u2014
\u2014
186,011
Other loans and advances (a)
\u2014
819,520
27,965
14,258
\u2014
\u2014
861,743
Loans and advances to customers (a)
\u2014
\u2014
8,846,738
14,060,004
35,227,857
587,901
58,722,500
Other financial assets (b)
\u2014
3,942,680
2,116,949
8,975,393
1,990,205
428,206
17,453,433
4,275,551
4,762,200
10,991,652
23,049,655
37,218,062
1,016,107
81,313,227
Liabilities
Deposits from Credit Institutions
\u2014
822,187
55,986
398
\u2014
\u2014
878,571
Deposits from costumers
53,469,091
24,744,000
9,255,155
204,614
\u2014
\u2014
87,672,860
Debt securities issued
\u2014
\u2014
\u2014
3,144,400
749,193
\u2014
3,893,593
Subordinated debt
\u2014
\u2014
\u2014
455,668
955,990
\u2014
1,411,658
53,469,091
25,566,187
9,311,141
3,805,080
1,705,183
\u2014
93,856,682
(a) Gross of impairment
(b) Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfLiquidityRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-729": { "value": "
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk
Committee, the following information is presented in accordance with COMMISSION IMPLEMENTING
REGULATION (EU) 2024/3172 of 29 November 2024 supplementing Regulation (EU) No 575/2013 of the European
Parliament and of the Council with regard to regulatory technical standards for disclosure of encumbered and
unencumbered assets.
(Thousands of euros)
2025 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the reporting
institution
2,825,812
1,652,402
103,830,893
37,426,892
Equity instruments
\u2014
\u2014
\u2014
\u2014
347,486
\u2014
347,486
\u2014
Debt securities
1,652,402
1,652,402
1,610,693
1,610,693
38,711,751
33,438,423
38,728,409
33,370,929
of which: covered
bonds
\u2014
\u2014
\u2014
\u2014
386,650
386,650
386,650
386,650
of which:
securitisations
\u2014
\u2014
\u2014
\u2014
54
\u2014
54
\u2014
of which: issued by
general governments
1,652,402
1,652,402
1,610,693
1,610,693
30,381,782
29,704,706
30,253,269
29,561,544
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
2,432,641
1,117,197
2,440,508
1,123,302
of which: issued by
non-financial
corporations
\u2014
\u2014
\u2014
\u2014
3,855,996
621,978
3,902,142
621,978
Other assets
1,215,490
\u2014
64,853,304
4,011,894
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2025 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing
institution
\u2014
\u2014
542,931
101,958
Debt securities
\u2014
\u2014
451,288
101,958
of which: covered bonds
\u2014
\u2014
264,730
\u2014
of which: issued by general governments
\u2014
\u2014
101,958
101,958
of which: issued by financial corporations
\u2014
\u2014
329,161
\u2014
Loans and advances other than loans on
demand
\u2014
\u2014
90,831
\u2014
Own covered bonds and securitisations issued
and not yet pledged
9,180,214
\u2014
TOTAL COLLATERAL RECEIVED AND OWN
DEBT SECURITIES ISSUED
2,825,812
1,652,402
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
(2) EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
2025 (1)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered bonds
and securitisations encumbered
Carrying amount of selected financial
liabilities
1,295,122
1,702,554
(1) The disclosed values in the template are calculated as rolling quarterly medians of the corresponding reporting values over the previous twelve
months by interpolation
", "dimensions": { "concept": "ifrs-full:DisclosureOfCollateralExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-731": { "value": "Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37
are the following:
1. In 2012, the Competition Authority (\u201cAdC\u201d) filed an administrative offence proceedings for alleged practices
restricting competition (proceedings PRC 2012/9). On 6 March 2013, it carried out measures of search and seizure
at Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) and other credit institutions facilities, where it seized
documents relevant to the investigation of an alleged exchange of sensitive commercial information between
credit institutions in the national market.
The proceedings were subject to justice secrecy by decision of the AdC, considering that the interests of the
investigation and the rights of the procedural parties would not be specifically compatible with the publicity of the
proceedings. On 2 June 2015, the Bank was notified of an infringement notice (\"NI\") adopted by the AdC in the
context of the investigation of proceedings PRC 2012/9, accusing it of participating, together with 14 other credit
institutions, in an exchange of sensitive commercial information, regarding the offer of credit products in retail
banking, namely home loan, consumer loan and corporate loan.
On 9 September 2019, the AdC adopted a final decision in this proceedings, and convicted the Bank to pay a EUR
60 million fine on the grounds that it had participated in a system of sharing confidential information between
competitors regarding home loan, consumer loan and corporate loan.\u00a0 BCP disagreed with the Decision, which it
considers having a set of serious defects, both in fact and in law, and appealed against it to the Competition Court
(CRSC) on 21 October 2019, requesting that it be annulled and that the appeal be given suspensive effect. On 8
May 2020, the appeal was admitted. On 21 December 2020, BCP submitted, which the Competition Court
accepted, a bank guarantee issued by the Bank itself as a way of fulfilling the bail. By order of 1 March 2021, the
Competition Court granted suspensive effect to the judicial objection appeal as to the sentencing decision. By
order of 20 March 2021, the Competition Court ordered the lifting of the justice secrecy and informed the
appellants that the trial should, in principle, begin in September 2021.
On 28 April 2022, the CRSC ruled within proceedings Proc. n.\u00ba 225/15.4YUSTR-W, regarding the judicial objection
appeal as to the decision of the Competition Authority of September 2019 (PRC/2012/09).
In this extensive ruling, the CRSC listed the facts given as proven, both in the administrative phase and in the trial,
however, at this stage, the CRSC did not concluded that the facts have been proven are legally based, nor,
consequently, that fines should be imposed, and the CRSC has instead chosen to make a reference for a
preliminary ruling to the Court of Justice of the European Union (CJEU) to answer two questions referred for a
preliminary ruling, requesting that this reference follow further terms in the form of an expedited procedure in
view of the limitation risk. It should be noted that the CJEU was not responsible for judging the case, but only for
interpreting the rules of Community law by answering in abstract to the questions referred to it by the national
court.
The CJEU rejected the CRSC's request for an expedited procedure and for priority to be given in the examination
of this proceedings.
On 29 July 2024, the CJEU delivered its judicial ruling in which it gave the following interpretation on the
questions referred by the CRSC:
\"Article 101(1), TFEU to be interpreted as meaning that a comprehensive reciprocal and monthly exchange of
information between competing credit institutions, carried out on highly concentrated markets with high barriers
to entry, and which regards the conditions applicable to transactions carried out on those markets, in particular
spreads and risk variables, current and future ones, as well as the individualised production values of the
participants in that exchange, to the extent that, at least, those spreads thus exchanged are those that those
institutions intend to apply in the future, must be qualified as a restriction of competition by object.\"
After the judicial Ruling, the proceedings returned to the CRSC, which issued an order on 30 July 2024, notifying
the Banks (i) of the appointment of 18 September 2024 for oral arguments, of an optional nature, limited to the
content of the CJEU Ruling; and (ii) the designation of 20 September 2024 for the reading of the Ruling, in the part
relating to the Law and the section.
On 20 September 2024, the CRSC issued its Final Ruling in which it deemed that an offence by object committed
by the Appellants BPN/BIC, BBVA, BPI, BCP, BES, Popular/Santander, Santander, Barclays, Caixa Agr\u00edcola,
Montepio, CGD and UCI, embodied in an exchange of sensitive information between competitors, was verified in
the case files.
In its Ruling, the CRSC confirmed the EUR 60 million fine imposed by the AdC on the Bank.
On 14 October 2024, the Bank filed its appeal with the Lisbon Court of Appeal (TRL), which, by decision issued on
10 February 2025 by its Intellectual Property, Competition and Supervision Section, decided, by majority, to declare
the pending administrative offence proceedings against the Defendant companies in relation to the practice of
the aforementioned administrative offence to be barred and ordered the timely filing of the case.
In summary, the TRL considered that the facts occurred between 2002 and March 2013, applying the 2012
Competition Law, which provides for the maximum limitation period for administrative offence proceedings of 10
years and 6 months, and not applying the 2022 Competition Law, which provides for a longer period of suspension
of the limitation period for administrative offence proceedings (either because the legislator so determined, or
because it is more unfavourable than the 2012 Competition Law).
Moreover, the reference for a preliminary ruling (made by the TCRS to the CJEU) does not suspend
(autonomously) the limitation period.
The TRL also considered that the limitation occurred on 1 September 2023 or, at the limit, applied to the so-called
Covid-19 laws, on 11 February 2024.
The Public Prosecutor's Office appealed against this decision to the Lisbon Court of Appeal and the Competition
Authority appealed to the Constitutional Court.
The Lisbon Court of Appeal rejected the Public Prosecutor's Office's claims of nullity regarding the statute of
limitations.
The Competition Authority and the Public Prosecutor's Office then filed appeals to the Constitutional Court
against the Lisbon Court of Appeal's ruling of 10 February 2025, which declared the statute of limitations for the
administrative offense proceedings to be time-barred.
Both the Competition Authority and the Public Prosecutor's Office raised questions of unconstitutionality related
to the exclusion of preliminary references to the CJEU as a ground for suspending the statute of limitations in
administrative offense proceedings. While the Competition Authority focused on the uniform application of
European law and the effectiveness of the competition sanctions regime, pointing out violations of the principles
of the Primacy of European Union Law and Effective Legal Protection, the Public Prosecutor's Office have adopted
a broader approach, also including violations of the Principle of Equality.
These appeals were admitted by the Regional Court of Appeal and were brought before the Constitutional Court.
The Constitutional Court admitted these appeals and issued a Summary Decision on 4 June 2025, disregarding
the appeals filed by the Competition Authority and the Public Prosecutor's Office.
Following this Summary Decision, the Competition Authority filed an appeal against the Constitutional Court's
individual decision to disregard the appeals filed by the Competition Authority and the Public Prosecutor's Office,
which the Constitutional Court is currently awaiting.
On 25 August 2025, the Constitutional Court issued its judgment dismissing the complaint filed for review by this
Court, confirming its Summary Decision of 4 June 2025, regarding the inadmissibility of the appeal.
In light of this Constitutional Court judgment, the Lisbon Court of Appeal's judgment of 10 February 2025 became
final, making the decision declaring the statute of limitations for the administrative offence proceedings final. This
concluded the proceedings and eliminated the payment of any fines by the Banks.
1-A. In relation to this administrative offence proceeding of the Competition Authority PRC/2012/09, and in view of
the alleged damage caused by the targeted and defendant Banks to bank customers, resulting from the alleged
sharing of confidential information between the Banks relating to home loan, consumer loan and corporate loan,
three declaratory popular actions of conviction were filed against the Bank and several other banking institutions.
These proposed popular actions aim to compensate consumers and companies affected by alleged harm caused
by the alleged anti-competitive practice. Actions vary depending on the group of consumers and companies
represented and the damages calculated.
It should be noted that the decision issued by the Lisbon Court of Appeal on 10 February 2025, which decided to
declare the administrative offence proceedings PRC/2012/09 barred, does not extinguish these popular actions,
which will now fully continue as \"stand alone\", not taking advantage of the presumption of evidence produced in
this case.
1-A.1. On 11 March 2024, BCP, along with 8 banking institutions, was summoned, to plead a \"popular declaratory
action of conviction in the form of a common proceeding aimed at the protection of competition, consumer
rights, and diverse and/or collective interests associated with the consumption of goods and services\", an action
brought by Ius Omnibus Association, which is under no. 2/24.1YQSRT in the Competition, Regulation and
Supervision Court, entirely based on the alleged competition offence in home and consumer loan transactions
declared in the AdC's Ruling of 9 September 2019 (PRC/2012/09), a ruling that was subject to a judicial objection
appeal by BCP, an objection that has not yet been definitively judged.
In this case, the Plaintiff makes the following main claims:
1. To be declared that, from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101(2) of the TFEU and (subsequently) article 2 of Decree-Law no. 371/393 and article 4 of Law no. 18/2003,
by exchanging strategic, non-public, current and future information, with its competitors, in a disaggregated,
individualised and regular manner, namely, on their respective offers of home loan and consumer loan;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Alternatively to section 2, to be declared that the Defendants' practice has led to their unjust enrichment at the
expense of the impoverishment of all the consumers represented;
4. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question in the amount resulting from the sum of several
factors.
5. To be declared the nullity of the clause(s) that fix the spread rate in home loan agreements and consumer loan
agreements entered into by consumers represented during the relevant period, the aforementioned clause(s)
being consequently reduced in the part corresponding to the unlawful overprice, in agreements whose validity
exceeds the date of the final judgment, and in which the Defendants are lenders, because they were entered
into by them or by subsequent termination of the contractual position.
As the deadline for the pleading is running, the Bank was notified on 9 May 2024 that an order had been issued
ordering the suspension of the proceedings until the final judgment to be rendered in proceeding no.
225/15.4YUSTR-W (the judicial objection appeal of the administrative offence proceeding PRC/2012/09), before this
Competition, Regulation and Supervision Court.
At the time, the TCRS also determined that, as soon as the administrative proceeding became final, the records of
Case n\u00ba. 2/24.1YQSTR would be notified.
The judgment of the administrative proceeding became final on 11 September 2025, as the Bank was notified of
the Court order lifting the suspension of Case No. 2/24.1YQSTR, the respective Response was submitted on the 24
February 2026.
1-A.2. On 8 April 2024, BCP, along with 9 banking institutions, was summoned to oppose another case brought
by Ius Omnibus Association against the banks, under no. 6/24.4YQSTR, also related to the aforementioned Ruling
of the AdC of 9 September 2019 (PRC/2012/09), this case being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No. 18/2003, by
exchanging strategic, non-public, current and future information with their competitors, in a disaggregated,
individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that the Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question, associated with the credits to the companies entered
into between the Defendants and companies in Portugal, in the period from May 2005 to September 2012, with
regard to the overprice that was passed on by the companies to the represented consumers, and charged
directly by the Defendants, in a global amount to be fixed and determined considering several factors.
On 18 November 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
On 8 January 2025, the Court ordered the attachment of Case n\u00ba 10/24.2YQSRT, identified below, to this case.
On 8 July 2025, the TCRS issued an Order of Acquittal of the Instance regarding the claims filed by IUS Omnibus
because the class of defendants was not adequately defined by Plaintiff Ius Omnibus.
Essentially, the TCRS found that the AIO failed to identify the small and medium-sized Portuguese companies that
contracted corporate loans in Portugal during the period of the alleged infringement, as stated in the Initial
Petition, nor was this publicly available. Indeed, it would be virtually impossible for the alleged defendants to
identify these companies and, therefore, guarantee their future claim for individual compensation.
The TCRS ruling of 8 July 2025, has already become final and was not appealed by the AIO. Consequently, the
Defendants (including BCP) were acquitted of the action brought by the AIO.
However, it is worth noting that, given that the action in Case No. 10/24.2YQSRT (the AMPEMEP action, which we
will discuss in section 1-A.3. below) was joined to the action in Case No. 6/24.4YQSRT, the AIO's action is addressed
separately in section 1-A.3.
1-A.3. On 24 April 2024, BCP, along with 9 banking institutions, was summoned to oppose an action brought by
Association of Portuguese Micro, Small and Medium Enterprises (AMPEMEP) against the banks, initially under no.
10/24.2YQSRT, also related to the aforementioned AdC\u2019 Decision of 9 September 2019 (PRC/2012/09), this case also
being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous
practice, article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No.
18/2003, by exchanging strategic, non-public, current and future information with their competitors, in a
disaggregated, individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice
paid as a result of the anti-competitive practices in question, associated with the credits to the companies
entered into between the Defendants and companies in Portugal, in the period from May 2005 to September
2012, with regard to the overprice that was passed on by the companies to the represented consumers, and
charged directly by the Defendants, in a global amount to be fixed and determined considering several
factors.
On 17 December 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
In view of the similarity of the object and parts of these 3 popular actions, the possibility of joining them was
raised, and BCP was notified, in the context of proceeding no. 6/24.4YQSTR (point 1-A.2.above) to rule on the
joinder to this action of proceeding no. 10/24.2YQSTR (point 1-A.3.above).
The Bank has commented on this issue, requesting the opposite, that is, that proceeding no. 6/24.4YQSTR be
joined to proceeding no. 10/24.2YQSTR instead, requesting that the logical precedence relationship between this
proceeding and that one be declared, and that the Judge in charge of proceeding no. 10/24.2YQSTR should be
granted the decision to join proceeding no. 6/24.4YQSTR.
On 8 January .2025, the Court ordered this to be attached to Process No. 6/24.4YQSRT.
Following the Preliminary Hearing on 10 July 2025, by a Corrective Order, the TCRS (Court of Appeals) ruled that
the Defendants, including BCP, be acquitted of the claims for compensation, considering that AMPEMEP lacks
standing to bring them due to the insufficient definition of the represented class and the failure to demonstrate
homogeneity among the allegedly represented companies.
However, the TCRS found that AMPEMEP has standing to request a declaration of wrongdoing in the corporate
credit segment, which is why the lawsuit proceeds without the Defendants, including BCP, being ordered to pay
compensation.
The Court also invited AMPEMEP to identify the articles of the Initial Petition that embody the violation (limited to
information on corporate credit) and the respective evidence. AMPEMEP filed its request to this effect on 9
October 2025. On the 3rd of November 2025 we indicated our means of proof.
The Bank was notified of the request to lodge a per saltum appeal with the Supreme Court of Justice and of the
respective plea, dated 27 October 2025, and in early December 2025 it submitted its reply to pleadings.
As the evolution of the case and its outcome are currently unpredictable, the case is currently proceeding to
appraisal of the merits of the declaratory claim, in terms of competition law infringement.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and
Jos\u00e9 Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo
Banco, S.A. and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the
defendant banks and the financial system, without which they would have sold the pledged shares and paid their
loans. If this is not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to
Funda\u00e7\u00e3o Jos\u00e9 Berardo for damages caused by breach of contract, since the moment when they should have
been sold in execution of the pledge due to failure to verify coverage ratios until the moment\u00a0 when they were
sold, that is, the difference between the price at which the pledged shares would have been sold on the dates of
coverage ratios default and the price at which they were actually sold, plus interest and all other loan charges
since those dates, in any case the global amount of compensation not being less than EUR 800,000,000. In any
case, the plaintiffs ask the defendant banks to be jointly condemned to pay Jos\u00e9 Manuel Rodrigues Berardo
compensation for moral damages, in the already calculated amount of EUR 100,000,000 and also in the amount
that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of
Ministers, published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9
Berardo, was declared extinct. This decision was legally contested by the Jos\u00e9 Berardo Foundation, and in April
2023, the Administrative and Fiscal Court of Funchal cancel the decision that ordered its extinction. Dissatisfied,
the Portuguese State appealed against this latter and is awaiting the outcome.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
Nothing relevant to the judgment on the merit of the case happened. The lawsuit is suspended until the motions
submitted by FJB in the execution filed by the Banks (8489/19.8T8LSB) have been definitively judged.
On 31 December 2025, the action remains suspended.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the
respective financial statements.
3. On 3 January 2018, Bank Millennium received a decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman), in which the OPCC Chairman found infringement by Bank
Millennium of the rights of consumers. In the opinion of the OPCC Chairman the essence of the violation is that
Bank Millennium informed consumers (it regards 78 agreements) in responses to their complaints, that the court
verdict stating the abusiveness of the provisions of the loan agreement regarding exchange rates does not apply
to them. According to the position of the OPCC Chairman the abusiveness of contract\u2019s clauses determined by the
court in the course of abstract control is constitutive and effective for every contract from the beginning. As a
result of the decision, Bank Millennium was obliged to:
1) send information on the UOKiK\u2019\u2019s decision to the said 78 customers;
2) place the information on decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (EUR 4.9 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium
appealed against the judgment within the statutory deadline. The court presented the view that the judgment
issued in the course of the control of a contractual template (in the course of an abstract control), recognising the
provisions of the template as abusive, determines the abusiveness of similar provisions in previously concluded
contracts. Therefore, the information provided to consumers was incorrect and misleading. As regards the penalty
imposed by OPCC, the court pointed out that the policy of imposing penalties by the Office had changed in the
direction of tightening penalties and that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the
perspective of today's case-law views on the importance of abstract control (it was not until January 2016 that the
Supreme Court's resolution supporting the view of the OPCC Chairman was published), the more penalties for
these behaviours should not be imposed using current policy. The above constitutes a significant argument
against the validity of the judgment and supports the appeal which Bank Millennium submitted to the Court of
second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. On 3 July
2024, the Supreme Court issued a decision accepting the cassation appeal for consideration. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is
positive and therefore no provision has been recognised.
4. Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC
Chairman recognised the practice of participating banks, including Bank Millennium, in an agreement aimed at
jointly setting interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of
competition, and by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2
million (EUR 2.9 million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection.
Bank Millennium has created a provision in the amount equal to the imposed penalty.
5. Bank Millennium is a defendant in two court proceedings, in which the subject of the dispute is the amount of
the interchange fee. The total value of claims reported in these cases is PLN 729.2 million (EUR 172.7 million). The
procedure with the highest value of the reported claim is the case is brought by PKN Orlen SA, the plaintiff
demands payment of PLN 635.7 million (EUR 150.5 million). The plaintiff in this proceeding alleges that the banks
acted under an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2006-2014. In this case, Bank Millennium was sued jointly with another
bank and card organisations. On 19 December 2025, the District Court in Warsaw dismissed in full the claims of
PKN Orlen S.A. The judgment is not final. In the case brought by LPP S.A. the allegations are similar to those raised
in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated as 2008-2014. In this
case, the Bank is sued jointly and severally with another bank. The case was resolved positively for the Bank by the
courts of both instances, and is currently at the stage of a cassation appeal filed by LPP S.A. The Supreme Court
did not issue a decision regarding the acceptance of the cassation appeal for consideration. According to current
estimates of the risk of losing a dispute in these matters, Bank Millennium did not create a provision.
In addition, we point out that Bank Millennium participates as a side intervener in three other proceedings
regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks of acting
as part of an agreement restricting competition on the acquiring services market by jointly setting the level of the
national interchange fee in the years 2008-2014.
The Bank believes that the prognosis regarding the litigation chances of winning the case is positive and therefore
no provision has been recognised.
- A lawsuit brought up by shareholder of PCZ S.A. in bankruptcy (PHM, then the European Foundation for Polish-
Belgian Cooperation - EFWP-B, currently called The European Foundation for Polish-Kenyan Cooperation) against
Bank Millennium S.A., worth of the dispute PLN 521.9 million (EUR 123.6 million) with statutory interest from 5 April
2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the Regional Court in Warsaw;
the suit was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis for the claim is damage
to their assets, due to the actions taken by Bank Millennium and consisting in the wrong interpretation of the
Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which resulted in placing
the loan on demand. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with the
charges raised in the claim. Supporting the position of Bank Millennium, the Bank's attorney submitted a binding
copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state in
the action brought by PCZ SA against Bank Millennium. On 10 May 2023, the Court of First Instance announced a
judgment dismissing the claim in its entirety. The verdict is not final, the plaintiff filed an appeal.
On 6 May 2024, the Bank Millennium's representative submitted a response to the appeal, requesting that it be
dismissed in its entirety as unfounded. On 17 December 2024, the Court of Appeal in Warsaw issued a judgment
favourable to the Bank, dismissing the Plaintiff's appeal. The judgment is final. The Bank has been served with the
Plaintiff\u2019s cassation complaint and has submitted a formal response. On 19 December 2025, the cassation appeal
was admitted for consideration.
Bank Millennium believes that the prognosis regarding the litigation chances of winning the case is positive and
therefore no provision has been recognised.
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors
(initially covering 454 borrowers party to 275 loan agreements) is represented by the Municipal Consumer
Ombudsman in Olsztyn. The plaintiffs demanded payment in the amount of PLN 3.5 million (EUR 0.8 million),
claiming that the clauses of the agreements, pertaining to the low-down payment insurance, are unfair and thus
not binding. Plaintiff extended the group in the court letter filed on 4 April 2018, therefore the claims increased
from PLN 3.5 million (EUR 0.8 million) to over PLN 5 million (EUR 1.2 million).
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings
and submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The
value of the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (EUR 1,745,449.9).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff
and decided to take witness evidence in writing. On 18 October 2024, the Court adjourned the hearing without
setting a new date. The court decided to disregard the evidence from the hearing of the parties and obliged the
parties to submit documents - agreements concluded between the group members and the Bank and final
judgements regarding the agreements in question. The court adjourned the hearing without specifying a new
date.The Bank submitted the above-mentioned documents in a letter dated 17 December 2024, while the group
representative, in performance of the obligation, submitted two letters containing documents confirming the
legitimacy of individual group members. The court obliged the Bank to submit a position in response to the letters
of the group representative. The obligation has been fulfilled.
The Bank Millennium has recognised a provision for this case in the amount resulting from the expected cash
outflow - PLN 4.4 million (EUR 1 million).
As at 31 December 2025, there were also 66 individual court cases regarding LTV (loans-to-value) insurance (cases
in which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial
Ombudsman, in the lawsuit, demands that Bank Millennium and the Insurer Towarzystwo Ubezpiecze\u0144 Europa,
S.A. be ordered to discontinue performing unfair market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its web site, information on
use of unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts.
Nonetheless, if the practice is deemed to be abusive it may constitute grounds for future claims to be filed by
individual customers.
The case is being examined by the court of first instance. Bank Millennium believes that the prognosis regarding
the litigation chances of winning the case is positive and therefore no provision has been recognised.
8. By 31 December 2025, Bank Millennium received 2,355 lawsuits in which the plaintiffs (both customers and
companies purchasing claims), alleging violation of the information obligations and demanding reimbursement
of interest and other costs incurred in connection with taking out a loan.
As at 31 December 2025, 373 cases have been legally concluded, in 332 cases the Bank won the dispute and lost in
41 cases. Disputes in the above respect are subject to constant observation and analysis. In the cases in question,
the Bank makes an individual assessment of the litigation chances in each of the court cases, which is justified by
the lack of a uniform line of jurisprudence. For cases in which, in the Bank\u2019s assessment, the probability of losing
the dispute is higher than that of winning it, provisions are created in an amount resulting from the expected cash
outflow. The case-law of the Court of Justice of the European Union, which interprets the provisions relating to the
objections raised in national judicial proceedings, plays an important role in shaping the line of jurisprudence.
On 13 February 2025, the Court of Justice of the European Union (CJEU) issued a judgment in a case registered
under the reference number C472/23 as a result of an application filed by the District Court for the Capital City of
Warsaw. In its judgment, the CJEU, interpreting the provisions of Directive 2008/48/EC of the European
Parliament and of the Council of 23 April 2008 on consumer credit agreements, found that:
(i) Article 10(2)(g) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that the
fact that a credit agreement refers to an annual percentage rate of charge, which proves to be overstated because
certain terms of that agreement are subsequently found to be unfair, within the meaning of Article 6(1) of Council
Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, and, therefore, are not binding on the
consumer, does not constitute, in itself, an infringement of the obligation to provide information laid down in that
provision of Directive 2008/48.
(ii) Article 10(2)(k) of Directive 2008/48 must be interpreted as meaning that the fact that a credit agreement lists a
certain number of circumstances justifying an increase in the costs connected with the performance of the
agreement, without, however, a reasonably well-informed and reasonably observant and circumspect consumer
being in a position to ascertain whether they have arisen and their effect on those costs, constitutes an
infringement of the obligation to provide information laid down in that provision, where that indication is liable to
call into question the possibility for that consumer to assess the extent of his or her liability.
(iii) Article 23 of Directive 2008/48, read in the light of recital 47 of that directive, must be interpreted as not
precluding national legislation which provides, in the event of infringement of the obligation to provide
information imposed on the creditor in accordance with Article 10(2) of that directive, for a uniform penalty,
consisting of depriving the creditor of its right to interest and charges, irrespective of the individual level of
seriousness of such an infringement, where that infringement is capable of calling into question the possibility for
the consumer to assess the extent of his or her liability.
Following the judgment of the Tribunal, it is still up to the domestic courts to assess the possibility of crediting
non-interest costs of the loan and to assess compliance with the information obligation regarding the possibility
of changing fees. The CJEU also noted that the right to benefit from the free loan sanction is updated only if a
potential breach of the bank may undermine the consumer's ability to assess the scope of his liability.
On 9 October 2025, the Court of Justice of the European Union, in case registered under reference C\u201180/24,
following a request submitted by the District Court for Warsaw \u2013 \u015ar\u00f3dmie\u015bcie in Warsaw, while interpreting the
provisions of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC, as well as Council Directive 93/13/EEC of 5
April 1993 on unfair terms in consumer contracts, held that:
(i) Article 22(2) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that it
does not preclude national legislation allowing a consumer to assign to a third party, who is not a consumer, a
claim based on the infringement of a right granted to him under national provisions implementing that Directive.
(ii) Articles 6(1) and 7(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be
interpreted as meaning that a national court is not required to examine of its own motion the unfair nature of a
term in an assignment agreement concluded by a consumer, where the dispute pending before that court
between the assignee company and the trader does not concern that assignment agreement but rather the
consumer\u2019s claim against that trader.
On 21 March 2025, the Financial Stability Committee issued a resolution (No. 79/2025) on the position regarding
the risk associated with the sanction of free credit (SKD). The Committee noted that \"while the violations listed in
the Consumer Credit Act are of a varied nature and severity, the sanction itself is not subject to gradation. The
inability to moderate sanctions creates a system of incentives to instrumentally use the benefits of the SKD and to
undermine credit agreements, regardless of whether the violation has economic consequences for the borrower
or not.\"
On 19 September 2025, the Financial Stability Committee convened. In the communiqu\u00e9 issued following the
meeting, the Committee stated: \"in the context of SKD - related risk, the Committee concluded that the draft
Consumer Credit Act presented for public consultation did not adequately reflect the FSC\u2019s position on the risks
associated with the application of the free credit sanction. The Committee notes that no regulatory measures have
been introduced that sufficiently restrict the scope and possibility of applying this sanction. The Committee
continues to identify areas that may facilitate the misuse of legal provisions intended to protect consumers.\"
9. By 31 December 2025, Bank Millennium recorded the receipt of 241 lawsuits by borrowers of mortgage loans in
PLN for reimbursement of benefits provided under the loan agreement. Seven final and favourable rulings for the
Bank were issued. The borrowers' allegations focus on the WIBOR ratio as an incomprehensible, unverifiable
element affecting the consumer's liability, as well as the issue of insufficient information on the effects of variable
interest rates provided to the consumer by the bank before the conclusion of the contract.
On 12 February 2026, the Court of Justice of the European Union issued a judgment in case C\u2011471/24, which may
have great significance for the manner in which national courts examine disputes in the relevant scope. It appears
that this ruling will be invoked by banks in order to strengthen their argumentation against the allegations
formulated against the durability of contractual obligations.
The Court stated that:
i) Article 1(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (that is that: contract
terms reflecting mandatory statutory or regulatory provisions and the provisions or principles of international
conventions to which the Member States or the Community are parties, in particular in the field of transport, shall
not be subject to the provisions of this Directive), must be interpreted as meaning that: the exception provided
therein does not cover a term of a mortgage loan agreement providing for a variable interest rate based on a
reference index within the meaning of Regulation (EU) 2016/1011 of the European Parliament and of the Council of
8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the
performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No
596/2014, and on a fixed margin, if the statutory or regulatory provisions applicable to such a term establish only a
general framework for determining the interest rate of such agreements while simultaneously leaving the trader
the possibility of determining the contractual reference index or the fixed margin which may be added to the
value of that index.
2) Article 4(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a mortgage loan agreement relating to residential property contains a term providing for a
variable interest rate based on a reference index within the meaning of Regulation 2016/1011, the transparency
requirement resulting from that provision does not impose on the lender specific information obligations relating
to the methodology of that index. The circumstance that the lender fulfilled all information obligations imposed
on it by Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit
agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and
2013/36/EU and Regulation (EU) No 1093/2010, as amended by Regulation 2016/1011, in relation to such a term, and,
in the case of providing additional information, did not present indications that would give a distorted picture of
the said index, may indicate that the lender fulfilled this transparency requirement with regard to that term.
3) Article 3(1) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a term of a mortgage loan agreement specifies a variable interest rate based on a reference
index within the meaning of Regulation 2016/1011, the following cannot render that term unfair: first, the lack of
informing the consumer of certain specific features of the contractual reference index, in particular that the
methodology of that index provides for the use of input data not necessarily corresponding to actual transactions,
and that the lender is one of the banks providing data used to determine that index, and second, those specific
features themselves, provided that the said index could be regarded as compliant with that Regulation at the time
of conclusion of that agreement.
On 29 June 2023, the Polish Financial Supervision Authority (KNF) announced that it had assessed the ability of the
WIBOR interest rate reference index to measure the market and economic realities. The KNF stated that the
WIBOR interest rate reference index is capable of measuring the market and economic realities for which it was
established. According to the Commission's assessment, the WIBOR ratio responds appropriately to changes in
liquidity conditions, changes in central bank rates and economic realities.
On 26 July 2023, the Polish Financial Supervision Authority (PFSA) presented its position on legal and economic
issues related to mortgage loan agreements in Polish currency in which the WIBOR interest rate reference\u00a0 index\u00a0
is\u00a0 used. This position can be used in court proceedings and can then be treated as an 'amicus curiae' opinion. The
Polish Financial Supervision Authority stated that the WIBOR reference index meets all legal requirements. In the
opinion of the Polish Financial Supervision Authority, there are no grounds to question the credibility and legality
of WIBOR, in particular in the context of the use of this indicator in mortgage loan agreements in the Polish
currency.
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
10. Currently, in connection with the activities of Bank Millennium - as it is the case with the activities of other
banks in Poland - the President of the Office of Competition and Consumer Protection is conducting proceedings
on the use of practices infringing the collective interests of consumers as regards the so-called \"unauthorised
transactions\". In the opinion of the President of the Office of Competition and Consumer Protection, in the case of
Bank Millennium, such actions include the following:
(i) failure \u2013 no later than by the end of the business day after the date of receipt of an appropriate notification from
the consumer regarding the occurrence of an unauthorised payment transaction \u2013 to refund the amount of the
unauthorised payment transaction or to restore the debited payment account to the state that would have
existed if the unauthorised payment transaction had not taken place, despite the lack of justified and duly
documented grounds to suspect fraud on the part of the consumer and informing the authorities appointed to
prosecute crimes about this suspicion in writing, as well as;
(ii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with information about the verification by the payment service provider of the correct use of the
payment instrument by using individual authentication data in a way suggesting that the Bank's demonstration
only that the disputed payment transactions have been correctly authenticated constitutes at the same time
demonstration of the authorisation of such a transaction and excludes its obligation to return the amount of the
unauthorised transaction and;
(iii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with false information about authorisation of the transactions questioned by consumers, while
presenting information indicating that the transactions took place as a result of an intentional or grossly negligent
violation by consumers of at least one of the obligations referred to in Article 42 of the Payment Services Act and
in the agreement between the consumer and the bank, as a result of which they are liable for the questioned
payment transactions.
In the course of the proceedings, the Bank provided appropriate explanations and also substantively referred to
the allegations formulated by the President of the Office of Competition and Consumer Protection. The
proceedings have been extended until the end of June 2026.
On 18 April 2025, Bank Millennium filed an application for a binding decision pursuant to Article 28 section 1 of the
Act on Competition and Consumer Protection. The application (proposal) includes all allegations presented by the
UOKiK, i.e. changes in the procedure for handling reports regarding unauthorised payment transactions, changes
in the classification of a given transaction as authorised and changes in complaint response templates. The
application also includes a proposal for \"compensation\" for customers whose complaints were rejected. Currently,
discussions with the President of the UOKiK regarding the issuance of a commitment decision are still ongoing.
In connection with the proceedings, the Bank Millennium recognised a provision as at the end of December 2025
in the amount of PLN 82 million (EUR 19.4 million) based on estimated outflow of funds.
As at 31 December 2025, the Bank Millennium was a party to 352 court proceedings in which customers
questioned the fact of their authorisation of a transaction. In the cases in question, the Bank Millennium makes an
individual assessment of the litigation chances in each of the court cases. In cases where, in the Bank's opinion,
there is a greater probability of losing the dispute than winning it, provisions in the amount resulting from the
potential loss of the Bank are created.
As at 31 December 2025, the total value of the subjects of the other litigations in which the Bank Millennium
Group\u2019s companies appeared as defendant, stood at PLN 5,060.6 million (EUR 1,198.4 million) (2024: PLN 6,186.4
million (EUR 1,446.5 million), excluding the class actions described in note 58. In this group the most important
category are cases related with FX loans mortgage portfolio.
11. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to EUR 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -,
filed against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they
acted pursuant to a request made by the Bank for the making of the respective purchases, and also that the court
orders the cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due
to relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs
and to refund them the cost they incurred while complying with that mandate, namely, EUR 90,483,816.83
regarding Banco Esp\u00edrito Santo, S.A. (BES) and EUR 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD),
plus default interests;
d) the amount of the lawsuit determined by the plaintiffs is EUR 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff
company in the amount of EUR 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report submitted.
In November 2022 the Bank complained about the Experts' Report: (i) they considered documents that the Court
had ordered to be removed from the proceedings, which had not been done due to the Court's inertia, (ii) they
considered written notes on documents, that may have been written by the entities that initiated the process, and
(iii) they did not consider much information that was contained in the statements, and (iv) they made errors in the
calculation of interest and the amount of financing granted. In view of the experts' new reply, BCP claimed all the
expertise, in March 2023. For the Court's final decision, BCP added, in June 2025, a set of documents supporting its
position.
On 31 December 2025, complaints regarding the expert assessment remain pending.
12. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal
applied a resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the
Decree-law 298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial
transfer of assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo
Banco, S.A. (Novo Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope
of this process, the Resolution Fund made a capital contribution to Novo Banco amounting to EUR 4,900 million,
becoming, on that date, the sole shareholder. Further, in accordance with information published on the
Resolution Fund\u2019s website, the Resolution Fund borrowed EUR 4,600 million, of which EUR 3,900 million were
granted by the Portuguese State and EUR 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities
emerging from the \u201ceventual negative effects of future decisions regarding the resolution process that may result
in liabilities or contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken,
following the publication of the report on the result of the independent evaluation, made to estimate the level of
credit recovery for each category of creditors under a hypothetical scenario of a normal insolvency process of BES
on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would
hypothetically take if BES had gone into liquidation right before the application of the resolution measure, such
creditors shall be entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the
total acknowledged credits, including capital, remunerative and default interest amounts to EUR 5,056,814,588, of
which EUR 2,221,549,499 are common credits and EUR 2,835,265,089 are subordinated claims, and no guaranteed
or privileged claims exist. Both the total number of acknowledged creditors and the total value of the
acknowledged credits and their ranking will only be ultimately determined upon the definitive judicial judgement
of the verification and ranking of credits to be given in the liquidation proceedings.
According to the Resolution Fund\u2019s Annual Report of 2024, \"in 2019, the Resolution Fund was informed that the
credits (it) claimed had not been recognised by the Liquidation Commission of BES \u2013 In Liquidation, whilst the
Resolution Fund filed an objection to the list of creditors with the Lisbon District Court, requesting that the credits
it claimed be recognised. The challenge was upheld and the Liquidation Committee of BES \u2013 In Liquidation
appealed. In 2023, the Lisbon Court of Appeal issued a judgement dismissing the appeal of the Liquidation
Commission of BES - In Liquidation, and in favour of the position defended by the Resolution Fund, confirms the
decision of the Court of First Instance and the recognition of the credits claimed by the Resolution Fund as
privileged credits. The Liquidation Commission of BES - In Liquidation, filed an appeal for review before the
Supreme Court of Justice, which issued a judgement in July 2023, which has already become final, recognising,
and classifying as privileged the credits claimed by the Resolution Fund for the total amount of EUR 1,242,568.9
thousand\".
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed
and is underway. According to note 25 of the Resolution Fund\u2019s Annual Report of 2024, \u201cLegal actions related to
the application of resolution measures have no definitive legal precedents, which makes it impossible to use case
law in its evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026)
The Resolution Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and
procedural information available so far, considers that there is no evidence to cast doubt on their belief that the
probability of success is higher than the probability of failure\u201d.
According to note 24 of the Resolution Fund\u2019s Annual Report of 2024, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco
de Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently
signed the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a
total of EUR 1,000 million in Novo Banco, of which EUR 750 million at completion and EUR 250 million within a
period of up to 3 years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco
and the Resolution Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the
performance of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align
incentives as well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new
shareholder of EUR 750 million, followed by a further capital increase of EUR 250 million by the end of 2017. Upon
completion of the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the
purposes of the resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding
the approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support
measures by the Resolution Fund and the Portuguese State that are part of the sale agreement associated with a
total gross book value of around EUR [10-20] billion(1) that revealed significant uncertainties regarding adequacy in
provisioning(2):
(i) Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding
costs, realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a
maximum of EUR 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some
additional conditions(1)(2)(3);
(ii) Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount
necessary (but no more than EUR 400 million). The amount that can be reclaimed by the Resolution Fund
under the CCA is subject to the cap of EUR 3.89 billion(2);
(iii) In case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted
by the Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism
(capital backstop), up to EUR 1.6 billion, provided for in the commitments made by the Portuguese State to
ensure the viability of NB, exists\u201d.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the
General Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding
its approval of the CCA of Novo Banco.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has
disclosed that the European Commission intends to consider the restructuring process of Novo Banco as
completed. The information disclosed today confirms the successful restructuring of Novo Banco, resulting from
the combined execution of the restructuring plan agreed in 2017, under the sale transaction conducted by Banco
de Portugal, and the sale agreements, namely the CCA, under which the Resolution Fund transferred to Novo
Banco EUR 485 million, less than the maximum amount set in the contract (EUR 3,890 million). The completion
of the restructuring of Novo Banco, is also another indicator that Novo Banco should not need to request any
further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that still
may occur regarding the amounts already requested by Novo Banco in relation to past years and that the
Resolution Fund considers that are not due.\"
On the same day, Banco de Portugal issued the following statement \"The conclusion of the Novo Banco
restructuring process also results in the end of the backstop mechanism, which provided for the possibility, which
was always considered remote, of the Portuguese State providing extraordinary support to Novo Banco in
extreme scenarios. This mechanism protected Novo Banco and the national financial system from more adverse
scenarios, which did not materialise. With the end of the backstop, the financial risk for the Portuguese State is
eliminated\".
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or Tier 1 SREP
requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
On 9 December 2024, the Resolution Fund announced in a statement that it had signed an agreement ending
the Contingent Capitalisation Agreement (CCA) signed in 2017 as part of the Novo Banco sale. This agreement
brings forward by around a year the end of the CCM, which until now had been scheduled for the end of 2025,
definitively extinguishing any possibility of Novo Banco requesting further payments from the Resolution Fund.
The main terms and conditions of the agreement to bring forward the end of the MCC include:
- Immediate termination of the CCA, bringing forward the maturity of the contract, scheduled for the end of 2025,
which implies, in particular, that no new payment requests can be made by Novo Banco, that operations relating
to the assets covered by the Agreement no longer require the Resolution Fund's opinion, and that the Monitoring
Committee is also extinguished, and that the impediment to the distribution of dividends by Novo Banco, which
was stipulated in the MCC, ceases.
- The existing payment obligations between the parties as a result of the CCA, as well as all litigation and disputes
related to the implementation of the agreement, are settled - without any transfer of funds.
- The Resolution Fund's contingent liabilities associated with the alleged breach of the \u201cBusiness Warranties\u201d
assumed in the Novo Banco sale agreement are extinguished, namely with the waiver of the compensation claims
preliminarily presented by Nani Holdings, which amounted to around EUR 60 million.
- The mechanism whereby the stake in Novo Banco held by Nani Holdings is not diluted in the event of capital
increases because of the application and under the terms of the Special Regime Applicable to Deferred Tax Assets
is extinguished.
The agreement allows for a significant reduction in the Resolution Fund's liabilities (in excess of EUR 73 million in
net terms, based on the amounts claimed by Novo Banco), as well as allowing for the extinction of potentially
significant contingencies. Thus, all the Resolution Fund's obligations relating to the CCA are definitively closed. The
amount paid by the Resolution Fund was therefore EUR 485 million below the maximum amount provided for in
the contract (EUR 3,890 million) and EUR 936 million below the aggregate amount of losses \u201ccovered\u201d by the
contingent capitalisation mechanism (EUR 4,341 million, as at 30/06/2024).
With the expiry of the Contingent Capitalisation Agreement, the payments made by the Resolution Fund will be
limited to the EUR 3,405 million that the Resolution Fund considered to be due, between 2018 and 2021.
According to a statement issued by the Banco de Portugal on 9 December 2024 on the end of the contingent
capitalisation agreement signed in the context of the sale of Novo Banco, \u201cThe CCA and the management of the
assets that comprised it were subject to numerous internal and external audits, as provided for in the original
Agreement, carried out by independent entities hired for this purpose. To this was added the monitoring carried
out by the supervisory authorities and others with powers to do so within the legal framework in force, including
the European Central Bank and the Court of Auditors.\u201d
According to Novo Banco\u2019s 2025 first half Report (note 28), Novo Banco adhered to the Special Regime applicable
to Deferred Tax Assets under Law 61/2014, of 26 August (REAID), according to which, the deferred tax assets
recorded until 31 December 2015 can be converted into tax credits when the taxable entity reports an annual net
loss, in accordance to the proportion of the amount of the said net loss to total equity at the individual company
level, A special reserve was established with an amount identical to the tax credit approved, increased by 10%. The
conversion rights are securities that entitle the State to require Novo Banco to increase its share capital by
incorporating the amount of the special reserve and consequently issuing and delivering free of charge ordinary
shares. The shareholders have the right to acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2024 Annual Report, under the terms of the sale of Novo Banco, the Fund is
required to maintain Nani Holdings' stake at 75% when that stake is affected by capital increases carried out under
the terms of the REAID.
According to the Resolution Fund\u2019s 2024 Annual Report, under REAID, Novo Banco, S. A., carried out three capital
increases by incorporation of reserves, through the rights conversion that had been attributed to the State as a
result of the conversion, into tax credits, of Novo Banco's deferred tax assets with reference to the 2015 to 2019 tax
periods.
According to Novo Banco\u2019s 2025 first half Report, Novo Banco carried out another capital increase following the
conversion of the conversion rights granted by the State for the 2020 fiscal year, fully subscribed by the Resolution
Fund.
On 13 June 2025, it was announced that a Memorandum of Understanding had been signed between the Lone
Star funds and the BPCE Group for the sale of the 75% stake held by Lone Star in Novo Banco. The acquisition will
be carried out for an estimated amount of EUR 6.4 billion for 100% of Novo Banco\u2019s share capital and is expected to
be completed in early 2026. According to the Resolution Fund's statement dated 13 June 2025, the sale of its stake
as part of this transaction will result in a gross inflow of approximately EUR 866 million. This amount will be used to
repay the Resolution Fund\u2019s debt, particularly to the State.
On 29 October 2025, the Ministry of Finance and the Resolution Fund signed an agreement with BPCE Group and
Nani Holdings for the sale of minority stakes held in the institution (specifically, 11.5% by the Portuguese State and
13.5% by the Resolution Fund) under the same financial conditions.
Following the completion of the process, BPCE Group will become the sole shareholder of Novo Banco.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to
fail\u201d and started an urgent resolution process of the institution through the partial or total sale of its activity, which
was completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and
obligations of Banif, formed by the assets, liabilities, off-balance sheet items and assets under management. The
largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of EUR 746 million. The Resolution Fund
provided a guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of
which EUR 489 million were provided by the Resolution Fund, which was funded by a loan granted by the State.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal
dismissed a lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de
Portugal. In its decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
On 4 July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds
issued in connection with the resolution of BANIF. Oitante's debt, which initially totalled EUR 746 million, has
therefore been fully settled. With the repayment of the debt, the Resolution Fund's responsibility as guarantor also
ceases, as well as the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the
non-acknowledged creditors. According to the Resolution Fund\u2019s 2023 Annual Report, the Resolution Fund holds
a claim on Banif of EUR 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF.
Under the judicial liquidation process of Banif, which was initiated following the resolution, the independent
evaluator estimates that the level of recovery of the financial support made available by the Resolution Fund, as
having a higher ranking at the end of the liquidation, is expected to be 7.6%.
The Resolution Fund on 19 December 2025 informed that Oitante approved another dividend distribution to the
Resolution Fund by EUR 13.1 million. This is the second distribution to the Resolution Fund in 2025, following the
payment of a EUR 13.1 million dividend during the year. With this new distribution, the amount delivered by
Oitante to the Resolution Fund totals EUR 176.2 million since the company was set up. The amounts received and
to be received by the Resolution Fund, given its 100% participation in Oitante's capital, contribute to reducing the
losses of Euro 489 million incurred by this Fund in the resolution of BANIF and will be used to repay the debts of
the Resolution Fund.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and
assumed other responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2024, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (EUR 3,900 million); (ii) to finance the absorption of Banif's losses (EUR 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (EUR 430 million plus EUR 850 million of additional funding requested in 2019 and EUR
850 million made available in 2020);
- Other funding received:
\u2022 in 2014 by seven domestic institutions in the amount of EUR 700 million, in which the Bank participates,
within the scope of BES resolution measure;
\u2022 in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up
to a maximum of EUR 429 million;
- The underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of
EUR 400 million (did not take place as the instruments were placed with third party investors as disclosed by Novo
Banco on 29 July 2018);
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a
loss greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralised by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, S.A.;
- CCA that allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions
related to the aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star
up to EUR 3.89 billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1
below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
To meet a payment from the Resolution Fund to Novo Banco, as per to Resolution 63-A/2021 of 27 May 2021 of the
Council of Ministers and Order from the Minister of State and Finance, of 31 May 2021 - intended to provide the
Resolution Fund with the financial resources necessary to meet any obligations arising from the Contingent
Capitalisation Agreement in the years 2021 and 2022 \u2013 rendering a new loan from the State to the Resolution
Fund, a number of national financial institutions offered to finance the Resolution Fund, increasing up to EUR 475
million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund.
According to the Resolution Fund\u2019s 2024 Annual Report from the maximum amount of EUR 475 million. The
Resolution Fund used EUR 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period
between the contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be
reviewed on 31 December 2026 and, after that, every five-years. The payment obligations arising from this loan
benefit from a pari passu treatment with the payment obligations of the loans entered into with the Portuguese
State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on 28 August 2014. The
funding costs of the Resolution Fund (from the State and from banks) will continue to be exclusively borne by
periodic revenues, corresponding to the contributions paid by the banking sector.
According to note 27 of the Resolution Fund\u2019s 2024 Annual Report, the Resolution Fund considers that, to date,
there are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the EUR 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution
Fund, the extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet
its obligations through its regular revenues, regardless of the contingencies to which the Resolution Fund is
exposed. On the same day, the Office of the Minister of Finance also announced that increases in the liabilities
arising from the materialisation of future contingencies will determine the maturity adjustment of State and bank
loans to the Resolution Fund, required from to maintain the contributory effort required from the banking sector
at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco
Esp\u00edrito Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to
EUR 4,953 million, of which EUR 4,253 million were granted by the Portuguese State and EUR 700 million were
granted by a group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on
the use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and
financial balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on
regular revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and
released on 12 July 2022, \"the repayment of the EUR 2,130 million loans granted by the Portuguese State to the
Resolution Fund will not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or
in 2059 (with the use of the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid
in 2062\u201d.
On 2 October 2017, by Resolution 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to
make available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary,
to satisfy any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-
mentioned resolution further set out that the framework agreement should be subject to a time period that is
consistent with the undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to
satisfy said obligations in due time.
As at 31 December 2024, the Resolution Fund's own resources had a negative equity of EUR 6,475.8 million, as
opposed to EUR 6,735.1 million at the end of 2023, according to the latest 2024 Annual Report of the Resolution
Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives
proceeds from the initial and regular contributions from the participating institutions (including the Bank) and
from the contribution over the banking sector (created under Law 55-A/2010). It is also provided for the possibility
of the member of the Government responsible for the area of Finance to determine, by ordinance that the
participating institutions make special contributions, in the situations provided for in the applicable legislation,
particularly if the Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying,
since 2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the
occurrence of the event which creates the obligation to pay the contribution, i.e. on the last day of April of each
year, as stipulated in Article 9 of the referred Decree-Law 24/2013, of 19 February, thus the Bank is recognising as
an expense the contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 14/2025, published on 15 December 2025, set the base rate for 2026 for the
determination of periodic contributions to the Resolution Fund at 0.047% (0.049% in 2025).
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a
proposal with respect to the determination of amounts, time limits, payment methods, and any other terms
related to the special contributions to be made by the institutions participating in the Resolution Fund. According
to public communications from both the Resolution Fund and from the Government, there is no indication that
any such special contributions are foreseen.
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is
not expected that the Resolution Fund will propose the setting up of a special contribution to finance the
resolution measure applied to BES. Therefore, the potential collection of a special contribution appears to be
unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in
the amount of EUR 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to
partially cover for the disbursements made by the Resolution Fund in respect of resolution measures prior to the
date of application of this Agreement. This amount will have to be reinstated over a period of 8 years (started in
2016) through the periodic contributions to the SRF. The Single Resolution Fund does not cover undergoing
situations with the National Resolution Fund as at 31 December 2015. In 2024, no contribution was made to the
Single Resolution Fund attributable to the Group (BCP and ActivoBank) according to information from the SRB \u2013
Single Resolution Board of 10 February 2025, which states that the financial means available in the Single
Resolution Fund at 31 December 2024 remains above the target level of at least 1% of covered deposits held in the
Member States participating in the Single Resolution Mechanism, as set in article 69 (1) of Regulation (EU)
806/2014.
In 2025, the Group made regular contributions to the Portuguese Resolution Fund in the amount of EUR 10,166
thousand. The amount related to the contribution on the banking sector in Portugal, recorded in this period was
EUR 28,560 thousand. These contributions were recognised as a cost in the first half of 2025, in accordance with
IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, according to note 27 of the 2024 Resolution Fund\u2019s annual report to assess the
effects on the Resolution Fund due to: (i) the sale of the shareholding in Novo Banco in accordance with the
communication of Banco de Portugal dated 18 October 2017 and the information provided by the European
Commission on this subject under the terms described above; (ii) the application of the principle that no creditor
of the credit institution under resolution may take on a loss greater than the one it would take if that institution
did not go into liquidation; and (iii) legal proceedings against the Resolution Fund.
13. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution
adopted by Banco de Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation
adopted by the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent
capitalisation agreement under which the Resolution Fund commits to inject capital in Novo Banco up to EUR 3,9
billion, under determined circumstances. In the proceedings, the claimants request the declaration of nullity or
annulment of those acts.
The proceedings were filed based on the information contained in the Communication from Banco de Portugal
dated 31 March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September
2017. Banco de Portugal and the Resolution Fund presented their arguments and, only very recently, Nani
Holdings SGPS, S.A. did the same since, by delay of the court, this company was only very recently notified to act as
a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Banco de Portugal cannot be challenged and (iii) the material incompetence
of the court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an
opponent party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the
opponent party. After the presentation of the arguments, Banco de Portugal attached to the proceedings what it
called an evidence process (allegedly in compliance with the law) but most of the documents delivered were
truncated in such a way that neither the court nor the claimants are able to obtain adequate knowledge thereof.
That issue was already raised in the proceedings (requesting the court to order Banco de Portugal to deliver a true
evidence process) but no decision thereon has been made yet.
The proceeding was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal
opinions to the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
On 31 December 2025, the proceedings are prepared for confirmation of the decision accepting the formalities of
the right of action (with the making of a decision on the specific objections invoked). In case the judge considers
that Novo Banco is an opponent party, the judge must start by issuing a pre-confirmation in order to request the
claimants to identify it. Afterwards, that Bank will be notified to present its opposition arguments.
On 31 December 2025, the proceedings have not progressed and are still before the judge (for a possible decision
on the reorganisation of the case).
By application dated 7 January 2026, the Bank took advantage of the Court's invitation to rule on the updating of
the data of the Counterparty Nani Holdings, SGPS, S.A., to submit a set of supervening documents to the case-files
and request the continuation of the proceedings.
Since the case has not undergone any developments since the end of the written proceedings (in 2018), it is not
possible to have a non-speculative expectation of its development or timetable for its conclusion, and it is not
anticipated that the agreement for the sale of NB will influence this timetable.
14. The Bank was subject to tax inspections for the years up to 2022. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the
case of indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of
determining the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/
corrections made by the tax administration were the object of contestation by administrative and/or judicial
means.
The Bank recorded provisions, current tax liabilities or deferred tax liabilities at the amount considered sufficient to
offset the tax or tax loss carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by
the tax administration.
15. Bank Millennium is a party to proceedings initiated by the President of UOKiK regarding the recognition of
certain provisions of a contract template as abusive. The proceedings concern modification clauses indicating the
circumstances in which the Bank is entitled to amend the terms and conditions and the fees and commissions
price lists. According to UOKiK, these clauses grant the Bank unlimited discretion in shaping the content of the
contract, which may violate good practice and grossly infringe the interests of consumers. The Bank challenged
the validity of these allegations, indicating that the provisions are precise and clearly define the conditions for their
application. The President of UOKiK extended the proceedings until 25 June 2026.
Bank Millennium is also a party to proceedings initiated by the President of UOKiK regarding the modification
clauses used by Euro Bank S.A., for which Bank Millennium S.A. is the legal successor. The President of UOKiK
extended these proceedings until 31 August 2026.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCommitmentsAndContingentLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-730": { "value": "Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37
are the following:
1. In 2012, the Competition Authority (\u201cAdC\u201d) filed an administrative offence proceedings for alleged practices
restricting competition (proceedings PRC 2012/9). On 6 March 2013, it carried out measures of search and seizure
at Banco Comercial Portugu\u00eas, S.A. (\u201cBCP\u201d or \u201cBank\u201d) and other credit institutions facilities, where it seized
documents relevant to the investigation of an alleged exchange of sensitive commercial information between
credit institutions in the national market.
The proceedings were subject to justice secrecy by decision of the AdC, considering that the interests of the
investigation and the rights of the procedural parties would not be specifically compatible with the publicity of the
proceedings. On 2 June 2015, the Bank was notified of an infringement notice (\"NI\") adopted by the AdC in the
context of the investigation of proceedings PRC 2012/9, accusing it of participating, together with 14 other credit
institutions, in an exchange of sensitive commercial information, regarding the offer of credit products in retail
banking, namely home loan, consumer loan and corporate loan.
On 9 September 2019, the AdC adopted a final decision in this proceedings, and convicted the Bank to pay a EUR
60 million fine on the grounds that it had participated in a system of sharing confidential information between
competitors regarding home loan, consumer loan and corporate loan.\u00a0 BCP disagreed with the Decision, which it
considers having a set of serious defects, both in fact and in law, and appealed against it to the Competition Court
(CRSC) on 21 October 2019, requesting that it be annulled and that the appeal be given suspensive effect. On 8
May 2020, the appeal was admitted. On 21 December 2020, BCP submitted, which the Competition Court
accepted, a bank guarantee issued by the Bank itself as a way of fulfilling the bail. By order of 1 March 2021, the
Competition Court granted suspensive effect to the judicial objection appeal as to the sentencing decision. By
order of 20 March 2021, the Competition Court ordered the lifting of the justice secrecy and informed the
appellants that the trial should, in principle, begin in September 2021.
On 28 April 2022, the CRSC ruled within proceedings Proc. n.\u00ba 225/15.4YUSTR-W, regarding the judicial objection
appeal as to the decision of the Competition Authority of September 2019 (PRC/2012/09).
In this extensive ruling, the CRSC listed the facts given as proven, both in the administrative phase and in the trial,
however, at this stage, the CRSC did not concluded that the facts have been proven are legally based, nor,
consequently, that fines should be imposed, and the CRSC has instead chosen to make a reference for a
preliminary ruling to the Court of Justice of the European Union (CJEU) to answer two questions referred for a
preliminary ruling, requesting that this reference follow further terms in the form of an expedited procedure in
view of the limitation risk. It should be noted that the CJEU was not responsible for judging the case, but only for
interpreting the rules of Community law by answering in abstract to the questions referred to it by the national
court.
The CJEU rejected the CRSC's request for an expedited procedure and for priority to be given in the examination
of this proceedings.
On 29 July 2024, the CJEU delivered its judicial ruling in which it gave the following interpretation on the
questions referred by the CRSC:
\"Article 101(1), TFEU to be interpreted as meaning that a comprehensive reciprocal and monthly exchange of
information between competing credit institutions, carried out on highly concentrated markets with high barriers
to entry, and which regards the conditions applicable to transactions carried out on those markets, in particular
spreads and risk variables, current and future ones, as well as the individualised production values of the
participants in that exchange, to the extent that, at least, those spreads thus exchanged are those that those
institutions intend to apply in the future, must be qualified as a restriction of competition by object.\"
After the judicial Ruling, the proceedings returned to the CRSC, which issued an order on 30 July 2024, notifying
the Banks (i) of the appointment of 18 September 2024 for oral arguments, of an optional nature, limited to the
content of the CJEU Ruling; and (ii) the designation of 20 September 2024 for the reading of the Ruling, in the part
relating to the Law and the section.
On 20 September 2024, the CRSC issued its Final Ruling in which it deemed that an offence by object committed
by the Appellants BPN/BIC, BBVA, BPI, BCP, BES, Popular/Santander, Santander, Barclays, Caixa Agr\u00edcola,
Montepio, CGD and UCI, embodied in an exchange of sensitive information between competitors, was verified in
the case files.
In its Ruling, the CRSC confirmed the EUR 60 million fine imposed by the AdC on the Bank.
On 14 October 2024, the Bank filed its appeal with the Lisbon Court of Appeal (TRL), which, by decision issued on
10 February 2025 by its Intellectual Property, Competition and Supervision Section, decided, by majority, to declare
the pending administrative offence proceedings against the Defendant companies in relation to the practice of
the aforementioned administrative offence to be barred and ordered the timely filing of the case.
In summary, the TRL considered that the facts occurred between 2002 and March 2013, applying the 2012
Competition Law, which provides for the maximum limitation period for administrative offence proceedings of 10
years and 6 months, and not applying the 2022 Competition Law, which provides for a longer period of suspension
of the limitation period for administrative offence proceedings (either because the legislator so determined, or
because it is more unfavourable than the 2012 Competition Law).
Moreover, the reference for a preliminary ruling (made by the TCRS to the CJEU) does not suspend
(autonomously) the limitation period.
The TRL also considered that the limitation occurred on 1 September 2023 or, at the limit, applied to the so-called
Covid-19 laws, on 11 February 2024.
The Public Prosecutor's Office appealed against this decision to the Lisbon Court of Appeal and the Competition
Authority appealed to the Constitutional Court.
The Lisbon Court of Appeal rejected the Public Prosecutor's Office's claims of nullity regarding the statute of
limitations.
The Competition Authority and the Public Prosecutor's Office then filed appeals to the Constitutional Court
against the Lisbon Court of Appeal's ruling of 10 February 2025, which declared the statute of limitations for the
administrative offense proceedings to be time-barred.
Both the Competition Authority and the Public Prosecutor's Office raised questions of unconstitutionality related
to the exclusion of preliminary references to the CJEU as a ground for suspending the statute of limitations in
administrative offense proceedings. While the Competition Authority focused on the uniform application of
European law and the effectiveness of the competition sanctions regime, pointing out violations of the principles
of the Primacy of European Union Law and Effective Legal Protection, the Public Prosecutor's Office have adopted
a broader approach, also including violations of the Principle of Equality.
These appeals were admitted by the Regional Court of Appeal and were brought before the Constitutional Court.
The Constitutional Court admitted these appeals and issued a Summary Decision on 4 June 2025, disregarding
the appeals filed by the Competition Authority and the Public Prosecutor's Office.
Following this Summary Decision, the Competition Authority filed an appeal against the Constitutional Court's
individual decision to disregard the appeals filed by the Competition Authority and the Public Prosecutor's Office,
which the Constitutional Court is currently awaiting.
On 25 August 2025, the Constitutional Court issued its judgment dismissing the complaint filed for review by this
Court, confirming its Summary Decision of 4 June 2025, regarding the inadmissibility of the appeal.
In light of this Constitutional Court judgment, the Lisbon Court of Appeal's judgment of 10 February 2025 became
final, making the decision declaring the statute of limitations for the administrative offence proceedings final. This
concluded the proceedings and eliminated the payment of any fines by the Banks.
1-A. In relation to this administrative offence proceeding of the Competition Authority PRC/2012/09, and in view of
the alleged damage caused by the targeted and defendant Banks to bank customers, resulting from the alleged
sharing of confidential information between the Banks relating to home loan, consumer loan and corporate loan,
three declaratory popular actions of conviction were filed against the Bank and several other banking institutions.
These proposed popular actions aim to compensate consumers and companies affected by alleged harm caused
by the alleged anti-competitive practice. Actions vary depending on the group of consumers and companies
represented and the damages calculated.
It should be noted that the decision issued by the Lisbon Court of Appeal on 10 February 2025, which decided to
declare the administrative offence proceedings PRC/2012/09 barred, does not extinguish these popular actions,
which will now fully continue as \"stand alone\", not taking advantage of the presumption of evidence produced in
this case.
1-A.1. On 11 March 2024, BCP, along with 8 banking institutions, was summoned, to plead a \"popular declaratory
action of conviction in the form of a common proceeding aimed at the protection of competition, consumer
rights, and diverse and/or collective interests associated with the consumption of goods and services\", an action
brought by Ius Omnibus Association, which is under no. 2/24.1YQSRT in the Competition, Regulation and
Supervision Court, entirely based on the alleged competition offence in home and consumer loan transactions
declared in the AdC's Ruling of 9 September 2019 (PRC/2012/09), a ruling that was subject to a judicial objection
appeal by BCP, an objection that has not yet been definitively judged.
In this case, the Plaintiff makes the following main claims:
1. To be declared that, from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101(2) of the TFEU and (subsequently) article 2 of Decree-Law no. 371/393 and article 4 of Law no. 18/2003,
by exchanging strategic, non-public, current and future information, with its competitors, in a disaggregated,
individualised and regular manner, namely, on their respective offers of home loan and consumer loan;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Alternatively to section 2, to be declared that the Defendants' practice has led to their unjust enrichment at the
expense of the impoverishment of all the consumers represented;
4. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question in the amount resulting from the sum of several
factors.
5. To be declared the nullity of the clause(s) that fix the spread rate in home loan agreements and consumer loan
agreements entered into by consumers represented during the relevant period, the aforementioned clause(s)
being consequently reduced in the part corresponding to the unlawful overprice, in agreements whose validity
exceeds the date of the final judgment, and in which the Defendants are lenders, because they were entered
into by them or by subsequent termination of the contractual position.
As the deadline for the pleading is running, the Bank was notified on 9 May 2024 that an order had been issued
ordering the suspension of the proceedings until the final judgment to be rendered in proceeding no.
225/15.4YUSTR-W (the judicial objection appeal of the administrative offence proceeding PRC/2012/09), before this
Competition, Regulation and Supervision Court.
At the time, the TCRS also determined that, as soon as the administrative proceeding became final, the records of
Case n\u00ba. 2/24.1YQSTR would be notified.
The judgment of the administrative proceeding became final on 11 September 2025, as the Bank was notified of
the Court order lifting the suspension of Case No. 2/24.1YQSTR, the respective Response was submitted on the 24
February 2026.
1-A.2. On 8 April 2024, BCP, along with 9 banking institutions, was summoned to oppose another case brought
by Ius Omnibus Association against the banks, under no. 6/24.4YQSTR, also related to the aforementioned Ruling
of the AdC of 9 September 2019 (PRC/2012/09), this case being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous practice,
article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No. 18/2003, by
exchanging strategic, non-public, current and future information with their competitors, in a disaggregated,
individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that the Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice paid
as a result of the anti-competitive practices in question, associated with the credits to the companies entered
into between the Defendants and companies in Portugal, in the period from May 2005 to September 2012, with
regard to the overprice that was passed on by the companies to the represented consumers, and charged
directly by the Defendants, in a global amount to be fixed and determined considering several factors.
On 18 November 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
On 8 January 2025, the Court ordered the attachment of Case n\u00ba 10/24.2YQSRT, identified below, to this case.
On 8 July 2025, the TCRS issued an Order of Acquittal of the Instance regarding the claims filed by IUS Omnibus
because the class of defendants was not adequately defined by Plaintiff Ius Omnibus.
Essentially, the TCRS found that the AIO failed to identify the small and medium-sized Portuguese companies that
contracted corporate loans in Portugal during the period of the alleged infringement, as stated in the Initial
Petition, nor was this publicly available. Indeed, it would be virtually impossible for the alleged defendants to
identify these companies and, therefore, guarantee their future claim for individual compensation.
The TCRS ruling of 8 July 2025, has already become final and was not appealed by the AIO. Consequently, the
Defendants (including BCP) were acquitted of the action brought by the AIO.
However, it is worth noting that, given that the action in Case No. 10/24.2YQSRT (the AMPEMEP action, which we
will discuss in section 1-A.3. below) was joined to the action in Case No. 6/24.4YQSRT, the AIO's action is addressed
separately in section 1-A.3.
1-A.3. On 24 April 2024, BCP, along with 9 banking institutions, was summoned to oppose an action brought by
Association of Portuguese Micro, Small and Medium Enterprises (AMPEMEP) against the banks, initially under no.
10/24.2YQSRT, also related to the aforementioned AdC\u2019 Decision of 9 September 2019 (PRC/2012/09), this case also
being related to the corporate credit segment.
In this case, the Plaintiff makes the following main claims:
1. To be declared that from May 2002 to March 2013, the Defendants violated, in a single and continuous
practice, article 101 of the TFEU and (successively) article 2 of Decree-Law No. 371/393 and article 4 of Law No.
18/2003, by exchanging strategic, non-public, current and future information with their competitors, in a
disaggregated, individualised, and regular manner, namely, on their respective credit offers to companies;
2. To be declared that this Defendants\u2019 practice has caused damage to the diverse or collective protection
interests of the consumption of goods and services and of competition, and to the individual homogeneous
interests of the consumers represented;
3. Based on civil liability, or, alternatively, by restitution of the undue, the Defendants be sentenced to
compensate/return in full all the consumers represented in this lawsuit for the damage suffered/overprice
paid as a result of the anti-competitive practices in question, associated with the credits to the companies
entered into between the Defendants and companies in Portugal, in the period from May 2005 to September
2012, with regard to the overprice that was passed on by the companies to the represented consumers, and
charged directly by the Defendants, in a global amount to be fixed and determined considering several
factors.
On 17 December 2024, the Bank filed its opposition with the Competition, Regulation and Supervision Court.
In view of the similarity of the object and parts of these 3 popular actions, the possibility of joining them was
raised, and BCP was notified, in the context of proceeding no. 6/24.4YQSTR (point 1-A.2.above) to rule on the
joinder to this action of proceeding no. 10/24.2YQSTR (point 1-A.3.above).
The Bank has commented on this issue, requesting the opposite, that is, that proceeding no. 6/24.4YQSTR be
joined to proceeding no. 10/24.2YQSTR instead, requesting that the logical precedence relationship between this
proceeding and that one be declared, and that the Judge in charge of proceeding no. 10/24.2YQSTR should be
granted the decision to join proceeding no. 6/24.4YQSTR.
On 8 January .2025, the Court ordered this to be attached to Process No. 6/24.4YQSRT.
Following the Preliminary Hearing on 10 July 2025, by a Corrective Order, the TCRS (Court of Appeals) ruled that
the Defendants, including BCP, be acquitted of the claims for compensation, considering that AMPEMEP lacks
standing to bring them due to the insufficient definition of the represented class and the failure to demonstrate
homogeneity among the allegedly represented companies.
However, the TCRS found that AMPEMEP has standing to request a declaration of wrongdoing in the corporate
credit segment, which is why the lawsuit proceeds without the Defendants, including BCP, being ordered to pay
compensation.
The Court also invited AMPEMEP to identify the articles of the Initial Petition that embody the violation (limited to
information on corporate credit) and the respective evidence. AMPEMEP filed its request to this effect on 9
October 2025. On the 3rd of November 2025 we indicated our means of proof.
The Bank was notified of the request to lodge a per saltum appeal with the Supreme Court of Justice and of the
respective plea, dated 27 October 2025, and in early December 2025 it submitted its reply to pleadings.
As the evolution of the case and its outcome are currently unpredictable, the case is currently proceeding to
appraisal of the merits of the declaratory claim, in terms of competition law infringement.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and
Jos\u00e9 Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo
Banco, S.A. and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the
defendant banks and the financial system, without which they would have sold the pledged shares and paid their
loans. If this is not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to
Funda\u00e7\u00e3o Jos\u00e9 Berardo for damages caused by breach of contract, since the moment when they should have
been sold in execution of the pledge due to failure to verify coverage ratios until the moment\u00a0 when they were
sold, that is, the difference between the price at which the pledged shares would have been sold on the dates of
coverage ratios default and the price at which they were actually sold, plus interest and all other loan charges
since those dates, in any case the global amount of compensation not being less than EUR 800,000,000. In any
case, the plaintiffs ask the defendant banks to be jointly condemned to pay Jos\u00e9 Manuel Rodrigues Berardo
compensation for moral damages, in the already calculated amount of EUR 100,000,000 and also in the amount
that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of
Ministers, published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9
Berardo, was declared extinct. This decision was legally contested by the Jos\u00e9 Berardo Foundation, and in April
2023, the Administrative and Fiscal Court of Funchal cancel the decision that ordered its extinction. Dissatisfied,
the Portuguese State appealed against this latter and is awaiting the outcome.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
Nothing relevant to the judgment on the merit of the case happened. The lawsuit is suspended until the motions
submitted by FJB in the execution filed by the Banks (8489/19.8T8LSB) have been definitively judged.
On 31 December 2025, the action remains suspended.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the
respective financial statements.
3. On 3 January 2018, Bank Millennium received a decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman), in which the OPCC Chairman found infringement by Bank
Millennium of the rights of consumers. In the opinion of the OPCC Chairman the essence of the violation is that
Bank Millennium informed consumers (it regards 78 agreements) in responses to their complaints, that the court
verdict stating the abusiveness of the provisions of the loan agreement regarding exchange rates does not apply
to them. According to the position of the OPCC Chairman the abusiveness of contract\u2019s clauses determined by the
court in the course of abstract control is constitutive and effective for every contract from the beginning. As a
result of the decision, Bank Millennium was obliged to:
1) send information on the UOKiK\u2019\u2019s decision to the said 78 customers;
2) place the information on decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (EUR 4.9 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium
appealed against the judgment within the statutory deadline. The court presented the view that the judgment
issued in the course of the control of a contractual template (in the course of an abstract control), recognising the
provisions of the template as abusive, determines the abusiveness of similar provisions in previously concluded
contracts. Therefore, the information provided to consumers was incorrect and misleading. As regards the penalty
imposed by OPCC, the court pointed out that the policy of imposing penalties by the Office had changed in the
direction of tightening penalties and that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the
perspective of today's case-law views on the importance of abstract control (it was not until January 2016 that the
Supreme Court's resolution supporting the view of the OPCC Chairman was published), the more penalties for
these behaviours should not be imposed using current policy. The above constitutes a significant argument
against the validity of the judgment and supports the appeal which Bank Millennium submitted to the Court of
second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. On 3 July
2024, the Supreme Court issued a decision accepting the cassation appeal for consideration. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is
positive and therefore no provision has been recognised.
4. Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC
Chairman recognised the practice of participating banks, including Bank Millennium, in an agreement aimed at
jointly setting interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of
competition, and by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2
million (EUR 2.9 million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection.
Bank Millennium has created a provision in the amount equal to the imposed penalty.
5. Bank Millennium is a defendant in two court proceedings, in which the subject of the dispute is the amount of
the interchange fee. The total value of claims reported in these cases is PLN 729.2 million (EUR 172.7 million). The
procedure with the highest value of the reported claim is the case is brought by PKN Orlen SA, the plaintiff
demands payment of PLN 635.7 million (EUR 150.5 million). The plaintiff in this proceeding alleges that the banks
acted under an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2006-2014. In this case, Bank Millennium was sued jointly with another
bank and card organisations. On 19 December 2025, the District Court in Warsaw dismissed in full the claims of
PKN Orlen S.A. The judgment is not final. In the case brought by LPP S.A. the allegations are similar to those raised
in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated as 2008-2014. In this
case, the Bank is sued jointly and severally with another bank. The case was resolved positively for the Bank by the
courts of both instances, and is currently at the stage of a cassation appeal filed by LPP S.A. The Supreme Court
did not issue a decision regarding the acceptance of the cassation appeal for consideration. According to current
estimates of the risk of losing a dispute in these matters, Bank Millennium did not create a provision.
In addition, we point out that Bank Millennium participates as a side intervener in three other proceedings
regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks of acting
as part of an agreement restricting competition on the acquiring services market by jointly setting the level of the
national interchange fee in the years 2008-2014.
The Bank believes that the prognosis regarding the litigation chances of winning the case is positive and therefore
no provision has been recognised.
- A lawsuit brought up by shareholder of PCZ S.A. in bankruptcy (PHM, then the European Foundation for Polish-
Belgian Cooperation - EFWP-B, currently called The European Foundation for Polish-Kenyan Cooperation) against
Bank Millennium S.A., worth of the dispute PLN 521.9 million (EUR 123.6 million) with statutory interest from 5 April
2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the Regional Court in Warsaw;
the suit was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis for the claim is damage
to their assets, due to the actions taken by Bank Millennium and consisting in the wrong interpretation of the
Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which resulted in placing
the loan on demand. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with the
charges raised in the claim. Supporting the position of Bank Millennium, the Bank's attorney submitted a binding
copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state in
the action brought by PCZ SA against Bank Millennium. On 10 May 2023, the Court of First Instance announced a
judgment dismissing the claim in its entirety. The verdict is not final, the plaintiff filed an appeal.
On 6 May 2024, the Bank Millennium's representative submitted a response to the appeal, requesting that it be
dismissed in its entirety as unfounded. On 17 December 2024, the Court of Appeal in Warsaw issued a judgment
favourable to the Bank, dismissing the Plaintiff's appeal. The judgment is final. The Bank has been served with the
Plaintiff\u2019s cassation complaint and has submitted a formal response. On 19 December 2025, the cassation appeal
was admitted for consideration.
Bank Millennium believes that the prognosis regarding the litigation chances of winning the case is positive and
therefore no provision has been recognised.
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors
(initially covering 454 borrowers party to 275 loan agreements) is represented by the Municipal Consumer
Ombudsman in Olsztyn. The plaintiffs demanded payment in the amount of PLN 3.5 million (EUR 0.8 million),
claiming that the clauses of the agreements, pertaining to the low-down payment insurance, are unfair and thus
not binding. Plaintiff extended the group in the court letter filed on 4 April 2018, therefore the claims increased
from PLN 3.5 million (EUR 0.8 million) to over PLN 5 million (EUR 1.2 million).
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings
and submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The
value of the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (EUR 1,745,449.9).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff
and decided to take witness evidence in writing. On 18 October 2024, the Court adjourned the hearing without
setting a new date. The court decided to disregard the evidence from the hearing of the parties and obliged the
parties to submit documents - agreements concluded between the group members and the Bank and final
judgements regarding the agreements in question. The court adjourned the hearing without specifying a new
date.The Bank submitted the above-mentioned documents in a letter dated 17 December 2024, while the group
representative, in performance of the obligation, submitted two letters containing documents confirming the
legitimacy of individual group members. The court obliged the Bank to submit a position in response to the letters
of the group representative. The obligation has been fulfilled.
The Bank Millennium has recognised a provision for this case in the amount resulting from the expected cash
outflow - PLN 4.4 million (EUR 1 million).
As at 31 December 2025, there were also 66 individual court cases regarding LTV (loans-to-value) insurance (cases
in which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial
Ombudsman, in the lawsuit, demands that Bank Millennium and the Insurer Towarzystwo Ubezpiecze\u0144 Europa,
S.A. be ordered to discontinue performing unfair market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its web site, information on
use of unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts.
Nonetheless, if the practice is deemed to be abusive it may constitute grounds for future claims to be filed by
individual customers.
The case is being examined by the court of first instance. Bank Millennium believes that the prognosis regarding
the litigation chances of winning the case is positive and therefore no provision has been recognised.
8. By 31 December 2025, Bank Millennium received 2,355 lawsuits in which the plaintiffs (both customers and
companies purchasing claims), alleging violation of the information obligations and demanding reimbursement
of interest and other costs incurred in connection with taking out a loan.
As at 31 December 2025, 373 cases have been legally concluded, in 332 cases the Bank won the dispute and lost in
41 cases. Disputes in the above respect are subject to constant observation and analysis. In the cases in question,
the Bank makes an individual assessment of the litigation chances in each of the court cases, which is justified by
the lack of a uniform line of jurisprudence. For cases in which, in the Bank\u2019s assessment, the probability of losing
the dispute is higher than that of winning it, provisions are created in an amount resulting from the expected cash
outflow. The case-law of the Court of Justice of the European Union, which interprets the provisions relating to the
objections raised in national judicial proceedings, plays an important role in shaping the line of jurisprudence.
On 13 February 2025, the Court of Justice of the European Union (CJEU) issued a judgment in a case registered
under the reference number C472/23 as a result of an application filed by the District Court for the Capital City of
Warsaw. In its judgment, the CJEU, interpreting the provisions of Directive 2008/48/EC of the European
Parliament and of the Council of 23 April 2008 on consumer credit agreements, found that:
(i) Article 10(2)(g) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that the
fact that a credit agreement refers to an annual percentage rate of charge, which proves to be overstated because
certain terms of that agreement are subsequently found to be unfair, within the meaning of Article 6(1) of Council
Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, and, therefore, are not binding on the
consumer, does not constitute, in itself, an infringement of the obligation to provide information laid down in that
provision of Directive 2008/48.
(ii) Article 10(2)(k) of Directive 2008/48 must be interpreted as meaning that the fact that a credit agreement lists a
certain number of circumstances justifying an increase in the costs connected with the performance of the
agreement, without, however, a reasonably well-informed and reasonably observant and circumspect consumer
being in a position to ascertain whether they have arisen and their effect on those costs, constitutes an
infringement of the obligation to provide information laid down in that provision, where that indication is liable to
call into question the possibility for that consumer to assess the extent of his or her liability.
(iii) Article 23 of Directive 2008/48, read in the light of recital 47 of that directive, must be interpreted as not
precluding national legislation which provides, in the event of infringement of the obligation to provide
information imposed on the creditor in accordance with Article 10(2) of that directive, for a uniform penalty,
consisting of depriving the creditor of its right to interest and charges, irrespective of the individual level of
seriousness of such an infringement, where that infringement is capable of calling into question the possibility for
the consumer to assess the extent of his or her liability.
Following the judgment of the Tribunal, it is still up to the domestic courts to assess the possibility of crediting
non-interest costs of the loan and to assess compliance with the information obligation regarding the possibility
of changing fees. The CJEU also noted that the right to benefit from the free loan sanction is updated only if a
potential breach of the bank may undermine the consumer's ability to assess the scope of his liability.
On 9 October 2025, the Court of Justice of the European Union, in case registered under reference C\u201180/24,
following a request submitted by the District Court for Warsaw \u2013 \u015ar\u00f3dmie\u015bcie in Warsaw, while interpreting the
provisions of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC, as well as Council Directive 93/13/EEC of 5
April 1993 on unfair terms in consumer contracts, held that:
(i) Article 22(2) of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit
agreements for consumers and repealing Council Directive 87/102/EEC must be interpreted as meaning that it
does not preclude national legislation allowing a consumer to assign to a third party, who is not a consumer, a
claim based on the infringement of a right granted to him under national provisions implementing that Directive.
(ii) Articles 6(1) and 7(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be
interpreted as meaning that a national court is not required to examine of its own motion the unfair nature of a
term in an assignment agreement concluded by a consumer, where the dispute pending before that court
between the assignee company and the trader does not concern that assignment agreement but rather the
consumer\u2019s claim against that trader.
On 21 March 2025, the Financial Stability Committee issued a resolution (No. 79/2025) on the position regarding
the risk associated with the sanction of free credit (SKD). The Committee noted that \"while the violations listed in
the Consumer Credit Act are of a varied nature and severity, the sanction itself is not subject to gradation. The
inability to moderate sanctions creates a system of incentives to instrumentally use the benefits of the SKD and to
undermine credit agreements, regardless of whether the violation has economic consequences for the borrower
or not.\"
On 19 September 2025, the Financial Stability Committee convened. In the communiqu\u00e9 issued following the
meeting, the Committee stated: \"in the context of SKD - related risk, the Committee concluded that the draft
Consumer Credit Act presented for public consultation did not adequately reflect the FSC\u2019s position on the risks
associated with the application of the free credit sanction. The Committee notes that no regulatory measures have
been introduced that sufficiently restrict the scope and possibility of applying this sanction. The Committee
continues to identify areas that may facilitate the misuse of legal provisions intended to protect consumers.\"
9. By 31 December 2025, Bank Millennium recorded the receipt of 241 lawsuits by borrowers of mortgage loans in
PLN for reimbursement of benefits provided under the loan agreement. Seven final and favourable rulings for the
Bank were issued. The borrowers' allegations focus on the WIBOR ratio as an incomprehensible, unverifiable
element affecting the consumer's liability, as well as the issue of insufficient information on the effects of variable
interest rates provided to the consumer by the bank before the conclusion of the contract.
On 12 February 2026, the Court of Justice of the European Union issued a judgment in case C\u2011471/24, which may
have great significance for the manner in which national courts examine disputes in the relevant scope. It appears
that this ruling will be invoked by banks in order to strengthen their argumentation against the allegations
formulated against the durability of contractual obligations.
The Court stated that:
i) Article 1(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (that is that: contract
terms reflecting mandatory statutory or regulatory provisions and the provisions or principles of international
conventions to which the Member States or the Community are parties, in particular in the field of transport, shall
not be subject to the provisions of this Directive), must be interpreted as meaning that: the exception provided
therein does not cover a term of a mortgage loan agreement providing for a variable interest rate based on a
reference index within the meaning of Regulation (EU) 2016/1011 of the European Parliament and of the Council of
8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the
performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No
596/2014, and on a fixed margin, if the statutory or regulatory provisions applicable to such a term establish only a
general framework for determining the interest rate of such agreements while simultaneously leaving the trader
the possibility of determining the contractual reference index or the fixed margin which may be added to the
value of that index.
2) Article 4(2) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a mortgage loan agreement relating to residential property contains a term providing for a
variable interest rate based on a reference index within the meaning of Regulation 2016/1011, the transparency
requirement resulting from that provision does not impose on the lender specific information obligations relating
to the methodology of that index. The circumstance that the lender fulfilled all information obligations imposed
on it by Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit
agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and
2013/36/EU and Regulation (EU) No 1093/2010, as amended by Regulation 2016/1011, in relation to such a term, and,
in the case of providing additional information, did not present indications that would give a distorted picture of
the said index, may indicate that the lender fulfilled this transparency requirement with regard to that term.
3) Article 3(1) of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as
meaning that where a term of a mortgage loan agreement specifies a variable interest rate based on a reference
index within the meaning of Regulation 2016/1011, the following cannot render that term unfair: first, the lack of
informing the consumer of certain specific features of the contractual reference index, in particular that the
methodology of that index provides for the use of input data not necessarily corresponding to actual transactions,
and that the lender is one of the banks providing data used to determine that index, and second, those specific
features themselves, provided that the said index could be regarded as compliant with that Regulation at the time
of conclusion of that agreement.
On 29 June 2023, the Polish Financial Supervision Authority (KNF) announced that it had assessed the ability of the
WIBOR interest rate reference index to measure the market and economic realities. The KNF stated that the
WIBOR interest rate reference index is capable of measuring the market and economic realities for which it was
established. According to the Commission's assessment, the WIBOR ratio responds appropriately to changes in
liquidity conditions, changes in central bank rates and economic realities.
On 26 July 2023, the Polish Financial Supervision Authority (PFSA) presented its position on legal and economic
issues related to mortgage loan agreements in Polish currency in which the WIBOR interest rate reference\u00a0 index\u00a0
is\u00a0 used. This position can be used in court proceedings and can then be treated as an 'amicus curiae' opinion. The
Polish Financial Supervision Authority stated that the WIBOR reference index meets all legal requirements. In the
opinion of the Polish Financial Supervision Authority, there are no grounds to question the credibility and legality
of WIBOR, in particular in the context of the use of this indicator in mortgage loan agreements in the Polish
currency.
For cases in which, in the Bank\u2019s assessment, the probability of losing the dispute is higher than that of winning it,
provisions are created in an amount resulting from the expected cash outflows.
10. Currently, in connection with the activities of Bank Millennium - as it is the case with the activities of other
banks in Poland - the President of the Office of Competition and Consumer Protection is conducting proceedings
on the use of practices infringing the collective interests of consumers as regards the so-called \"unauthorised
transactions\". In the opinion of the President of the Office of Competition and Consumer Protection, in the case of
Bank Millennium, such actions include the following:
(i) failure \u2013 no later than by the end of the business day after the date of receipt of an appropriate notification from
the consumer regarding the occurrence of an unauthorised payment transaction \u2013 to refund the amount of the
unauthorised payment transaction or to restore the debited payment account to the state that would have
existed if the unauthorised payment transaction had not taken place, despite the lack of justified and duly
documented grounds to suspect fraud on the part of the consumer and informing the authorities appointed to
prosecute crimes about this suspicion in writing, as well as;
(ii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with information about the verification by the payment service provider of the correct use of the
payment instrument by using individual authentication data in a way suggesting that the Bank's demonstration
only that the disputed payment transactions have been correctly authenticated constitutes at the same time
demonstration of the authorisation of such a transaction and excludes its obligation to return the amount of the
unauthorised transaction and;
(iii) providing consumers \u2013 in the replies to their reports regarding the occurrence of unauthorised payment
transactions \u2013 with false information about authorisation of the transactions questioned by consumers, while
presenting information indicating that the transactions took place as a result of an intentional or grossly negligent
violation by consumers of at least one of the obligations referred to in Article 42 of the Payment Services Act and
in the agreement between the consumer and the bank, as a result of which they are liable for the questioned
payment transactions.
In the course of the proceedings, the Bank provided appropriate explanations and also substantively referred to
the allegations formulated by the President of the Office of Competition and Consumer Protection. The
proceedings have been extended until the end of June 2026.
On 18 April 2025, Bank Millennium filed an application for a binding decision pursuant to Article 28 section 1 of the
Act on Competition and Consumer Protection. The application (proposal) includes all allegations presented by the
UOKiK, i.e. changes in the procedure for handling reports regarding unauthorised payment transactions, changes
in the classification of a given transaction as authorised and changes in complaint response templates. The
application also includes a proposal for \"compensation\" for customers whose complaints were rejected. Currently,
discussions with the President of the UOKiK regarding the issuance of a commitment decision are still ongoing.
In connection with the proceedings, the Bank Millennium recognised a provision as at the end of December 2025
in the amount of PLN 82 million (EUR 19.4 million) based on estimated outflow of funds.
As at 31 December 2025, the Bank Millennium was a party to 352 court proceedings in which customers
questioned the fact of their authorisation of a transaction. In the cases in question, the Bank Millennium makes an
individual assessment of the litigation chances in each of the court cases. In cases where, in the Bank's opinion,
there is a greater probability of losing the dispute than winning it, provisions in the amount resulting from the
potential loss of the Bank are created.
As at 31 December 2025, the total value of the subjects of the other litigations in which the Bank Millennium
Group\u2019s companies appeared as defendant, stood at PLN 5,060.6 million (EUR 1,198.4 million) (2024: PLN 6,186.4
million (EUR 1,446.5 million), excluding the class actions described in note 58. In this group the most important
category are cases related with FX loans mortgage portfolio.
11. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to EUR 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -,
filed against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they
acted pursuant to a request made by the Bank for the making of the respective purchases, and also that the court
orders the cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due
to relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs
and to refund them the cost they incurred while complying with that mandate, namely, EUR 90,483,816.83
regarding Banco Esp\u00edrito Santo, S.A. (BES) and EUR 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD),
plus default interests;
d) the amount of the lawsuit determined by the plaintiffs is EUR 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff
company in the amount of EUR 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report submitted.
In November 2022 the Bank complained about the Experts' Report: (i) they considered documents that the Court
had ordered to be removed from the proceedings, which had not been done due to the Court's inertia, (ii) they
considered written notes on documents, that may have been written by the entities that initiated the process, and
(iii) they did not consider much information that was contained in the statements, and (iv) they made errors in the
calculation of interest and the amount of financing granted. In view of the experts' new reply, BCP claimed all the
expertise, in March 2023. For the Court's final decision, BCP added, in June 2025, a set of documents supporting its
position.
On 31 December 2025, complaints regarding the expert assessment remain pending.
12. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal
applied a resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the
Decree-law 298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial
transfer of assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo
Banco, S.A. (Novo Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope
of this process, the Resolution Fund made a capital contribution to Novo Banco amounting to EUR 4,900 million,
becoming, on that date, the sole shareholder. Further, in accordance with information published on the
Resolution Fund\u2019s website, the Resolution Fund borrowed EUR 4,600 million, of which EUR 3,900 million were
granted by the Portuguese State and EUR 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities
emerging from the \u201ceventual negative effects of future decisions regarding the resolution process that may result
in liabilities or contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken,
following the publication of the report on the result of the independent evaluation, made to estimate the level of
credit recovery for each category of creditors under a hypothetical scenario of a normal insolvency process of BES
on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would
hypothetically take if BES had gone into liquidation right before the application of the resolution measure, such
creditors shall be entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the
total acknowledged credits, including capital, remunerative and default interest amounts to EUR 5,056,814,588, of
which EUR 2,221,549,499 are common credits and EUR 2,835,265,089 are subordinated claims, and no guaranteed
or privileged claims exist. Both the total number of acknowledged creditors and the total value of the
acknowledged credits and their ranking will only be ultimately determined upon the definitive judicial judgement
of the verification and ranking of credits to be given in the liquidation proceedings.
According to the Resolution Fund\u2019s Annual Report of 2024, \"in 2019, the Resolution Fund was informed that the
credits (it) claimed had not been recognised by the Liquidation Commission of BES \u2013 In Liquidation, whilst the
Resolution Fund filed an objection to the list of creditors with the Lisbon District Court, requesting that the credits
it claimed be recognised. The challenge was upheld and the Liquidation Committee of BES \u2013 In Liquidation
appealed. In 2023, the Lisbon Court of Appeal issued a judgement dismissing the appeal of the Liquidation
Commission of BES - In Liquidation, and in favour of the position defended by the Resolution Fund, confirms the
decision of the Court of First Instance and the recognition of the credits claimed by the Resolution Fund as
privileged credits. The Liquidation Commission of BES - In Liquidation, filed an appeal for review before the
Supreme Court of Justice, which issued a judgement in July 2023, which has already become final, recognising,
and classifying as privileged the credits claimed by the Resolution Fund for the total amount of EUR 1,242,568.9
thousand\".
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed
and is underway. According to note 25 of the Resolution Fund\u2019s Annual Report of 2024, \u201cLegal actions related to
the application of resolution measures have no definitive legal precedents, which makes it impossible to use case
law in its evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026)
The Resolution Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and
procedural information available so far, considers that there is no evidence to cast doubt on their belief that the
probability of success is higher than the probability of failure\u201d.
According to note 24 of the Resolution Fund\u2019s Annual Report of 2024, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco
de Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently
signed the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a
total of EUR 1,000 million in Novo Banco, of which EUR 750 million at completion and EUR 250 million within a
period of up to 3 years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco
and the Resolution Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the
performance of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align
incentives as well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new
shareholder of EUR 750 million, followed by a further capital increase of EUR 250 million by the end of 2017. Upon
completion of the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the
purposes of the resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding
the approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support
measures by the Resolution Fund and the Portuguese State that are part of the sale agreement associated with a
total gross book value of around EUR [10-20] billion(1) that revealed significant uncertainties regarding adequacy in
provisioning(2):
(i) Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding
costs, realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a
maximum of EUR 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some
additional conditions(1)(2)(3);
(ii) Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount
necessary (but no more than EUR 400 million). The amount that can be reclaimed by the Resolution Fund
under the CCA is subject to the cap of EUR 3.89 billion(2);
(iii) In case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted
by the Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism
(capital backstop), up to EUR 1.6 billion, provided for in the commitments made by the Portuguese State to
ensure the viability of NB, exists\u201d.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the
General Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding
its approval of the CCA of Novo Banco.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has
disclosed that the European Commission intends to consider the restructuring process of Novo Banco as
completed. The information disclosed today confirms the successful restructuring of Novo Banco, resulting from
the combined execution of the restructuring plan agreed in 2017, under the sale transaction conducted by Banco
de Portugal, and the sale agreements, namely the CCA, under which the Resolution Fund transferred to Novo
Banco EUR 485 million, less than the maximum amount set in the contract (EUR 3,890 million). The completion
of the restructuring of Novo Banco, is also another indicator that Novo Banco should not need to request any
further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that still
may occur regarding the amounts already requested by Novo Banco in relation to past years and that the
Resolution Fund considers that are not due.\"
On the same day, Banco de Portugal issued the following statement \"The conclusion of the Novo Banco
restructuring process also results in the end of the backstop mechanism, which provided for the possibility, which
was always considered remote, of the Portuguese State providing extraordinary support to Novo Banco in
extreme scenarios. This mechanism protected Novo Banco and the national financial system from more adverse
scenarios, which did not materialise. With the end of the backstop, the financial risk for the Portuguese State is
eliminated\".
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or Tier 1 SREP
requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
On 9 December 2024, the Resolution Fund announced in a statement that it had signed an agreement ending
the Contingent Capitalisation Agreement (CCA) signed in 2017 as part of the Novo Banco sale. This agreement
brings forward by around a year the end of the CCM, which until now had been scheduled for the end of 2025,
definitively extinguishing any possibility of Novo Banco requesting further payments from the Resolution Fund.
The main terms and conditions of the agreement to bring forward the end of the MCC include:
- Immediate termination of the CCA, bringing forward the maturity of the contract, scheduled for the end of 2025,
which implies, in particular, that no new payment requests can be made by Novo Banco, that operations relating
to the assets covered by the Agreement no longer require the Resolution Fund's opinion, and that the Monitoring
Committee is also extinguished, and that the impediment to the distribution of dividends by Novo Banco, which
was stipulated in the MCC, ceases.
- The existing payment obligations between the parties as a result of the CCA, as well as all litigation and disputes
related to the implementation of the agreement, are settled - without any transfer of funds.
- The Resolution Fund's contingent liabilities associated with the alleged breach of the \u201cBusiness Warranties\u201d
assumed in the Novo Banco sale agreement are extinguished, namely with the waiver of the compensation claims
preliminarily presented by Nani Holdings, which amounted to around EUR 60 million.
- The mechanism whereby the stake in Novo Banco held by Nani Holdings is not diluted in the event of capital
increases because of the application and under the terms of the Special Regime Applicable to Deferred Tax Assets
is extinguished.
The agreement allows for a significant reduction in the Resolution Fund's liabilities (in excess of EUR 73 million in
net terms, based on the amounts claimed by Novo Banco), as well as allowing for the extinction of potentially
significant contingencies. Thus, all the Resolution Fund's obligations relating to the CCA are definitively closed. The
amount paid by the Resolution Fund was therefore EUR 485 million below the maximum amount provided for in
the contract (EUR 3,890 million) and EUR 936 million below the aggregate amount of losses \u201ccovered\u201d by the
contingent capitalisation mechanism (EUR 4,341 million, as at 30/06/2024).
With the expiry of the Contingent Capitalisation Agreement, the payments made by the Resolution Fund will be
limited to the EUR 3,405 million that the Resolution Fund considered to be due, between 2018 and 2021.
According to a statement issued by the Banco de Portugal on 9 December 2024 on the end of the contingent
capitalisation agreement signed in the context of the sale of Novo Banco, \u201cThe CCA and the management of the
assets that comprised it were subject to numerous internal and external audits, as provided for in the original
Agreement, carried out by independent entities hired for this purpose. To this was added the monitoring carried
out by the supervisory authorities and others with powers to do so within the legal framework in force, including
the European Central Bank and the Court of Auditors.\u201d
According to Novo Banco\u2019s 2025 first half Report (note 28), Novo Banco adhered to the Special Regime applicable
to Deferred Tax Assets under Law 61/2014, of 26 August (REAID), according to which, the deferred tax assets
recorded until 31 December 2015 can be converted into tax credits when the taxable entity reports an annual net
loss, in accordance to the proportion of the amount of the said net loss to total equity at the individual company
level, A special reserve was established with an amount identical to the tax credit approved, increased by 10%. The
conversion rights are securities that entitle the State to require Novo Banco to increase its share capital by
incorporating the amount of the special reserve and consequently issuing and delivering free of charge ordinary
shares. The shareholders have the right to acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2024 Annual Report, under the terms of the sale of Novo Banco, the Fund is
required to maintain Nani Holdings' stake at 75% when that stake is affected by capital increases carried out under
the terms of the REAID.
According to the Resolution Fund\u2019s 2024 Annual Report, under REAID, Novo Banco, S. A., carried out three capital
increases by incorporation of reserves, through the rights conversion that had been attributed to the State as a
result of the conversion, into tax credits, of Novo Banco's deferred tax assets with reference to the 2015 to 2019 tax
periods.
According to Novo Banco\u2019s 2025 first half Report, Novo Banco carried out another capital increase following the
conversion of the conversion rights granted by the State for the 2020 fiscal year, fully subscribed by the Resolution
Fund.
On 13 June 2025, it was announced that a Memorandum of Understanding had been signed between the Lone
Star funds and the BPCE Group for the sale of the 75% stake held by Lone Star in Novo Banco. The acquisition will
be carried out for an estimated amount of EUR 6.4 billion for 100% of Novo Banco\u2019s share capital and is expected to
be completed in early 2026. According to the Resolution Fund's statement dated 13 June 2025, the sale of its stake
as part of this transaction will result in a gross inflow of approximately EUR 866 million. This amount will be used to
repay the Resolution Fund\u2019s debt, particularly to the State.
On 29 October 2025, the Ministry of Finance and the Resolution Fund signed an agreement with BPCE Group and
Nani Holdings for the sale of minority stakes held in the institution (specifically, 11.5% by the Portuguese State and
13.5% by the Resolution Fund) under the same financial conditions.
Following the completion of the process, BPCE Group will become the sole shareholder of Novo Banco.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to
fail\u201d and started an urgent resolution process of the institution through the partial or total sale of its activity, which
was completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and
obligations of Banif, formed by the assets, liabilities, off-balance sheet items and assets under management. The
largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of EUR 746 million. The Resolution Fund
provided a guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of
which EUR 489 million were provided by the Resolution Fund, which was funded by a loan granted by the State.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal
dismissed a lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de
Portugal. In its decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
On 4 July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds
issued in connection with the resolution of BANIF. Oitante's debt, which initially totalled EUR 746 million, has
therefore been fully settled. With the repayment of the debt, the Resolution Fund's responsibility as guarantor also
ceases, as well as the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the
non-acknowledged creditors. According to the Resolution Fund\u2019s 2023 Annual Report, the Resolution Fund holds
a claim on Banif of EUR 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF.
Under the judicial liquidation process of Banif, which was initiated following the resolution, the independent
evaluator estimates that the level of recovery of the financial support made available by the Resolution Fund, as
having a higher ranking at the end of the liquidation, is expected to be 7.6%.
The Resolution Fund on 19 December 2025 informed that Oitante approved another dividend distribution to the
Resolution Fund by EUR 13.1 million. This is the second distribution to the Resolution Fund in 2025, following the
payment of a EUR 13.1 million dividend during the year. With this new distribution, the amount delivered by
Oitante to the Resolution Fund totals EUR 176.2 million since the company was set up. The amounts received and
to be received by the Resolution Fund, given its 100% participation in Oitante's capital, contribute to reducing the
losses of Euro 489 million incurred by this Fund in the resolution of BANIF and will be used to repay the debts of
the Resolution Fund.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and
assumed other responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2024, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (EUR 3,900 million); (ii) to finance the absorption of Banif's losses (EUR 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (EUR 430 million plus EUR 850 million of additional funding requested in 2019 and EUR
850 million made available in 2020);
- Other funding received:
\u2022 in 2014 by seven domestic institutions in the amount of EUR 700 million, in which the Bank participates,
within the scope of BES resolution measure;
\u2022 in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up
to a maximum of EUR 429 million;
- The underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of
EUR 400 million (did not take place as the instruments were placed with third party investors as disclosed by Novo
Banco on 29 July 2018);
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a
loss greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralised by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, S.A.;
- CCA that allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions
related to the aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star
up to EUR 3.89 billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1
below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
To meet a payment from the Resolution Fund to Novo Banco, as per to Resolution 63-A/2021 of 27 May 2021 of the
Council of Ministers and Order from the Minister of State and Finance, of 31 May 2021 - intended to provide the
Resolution Fund with the financial resources necessary to meet any obligations arising from the Contingent
Capitalisation Agreement in the years 2021 and 2022 \u2013 rendering a new loan from the State to the Resolution
Fund, a number of national financial institutions offered to finance the Resolution Fund, increasing up to EUR 475
million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund.
According to the Resolution Fund\u2019s 2024 Annual Report from the maximum amount of EUR 475 million. The
Resolution Fund used EUR 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period
between the contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be
reviewed on 31 December 2026 and, after that, every five-years. The payment obligations arising from this loan
benefit from a pari passu treatment with the payment obligations of the loans entered into with the Portuguese
State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on 28 August 2014. The
funding costs of the Resolution Fund (from the State and from banks) will continue to be exclusively borne by
periodic revenues, corresponding to the contributions paid by the banking sector.
According to note 27 of the Resolution Fund\u2019s 2024 Annual Report, the Resolution Fund considers that, to date,
there are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the EUR 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution
Fund, the extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet
its obligations through its regular revenues, regardless of the contingencies to which the Resolution Fund is
exposed. On the same day, the Office of the Minister of Finance also announced that increases in the liabilities
arising from the materialisation of future contingencies will determine the maturity adjustment of State and bank
loans to the Resolution Fund, required from to maintain the contributory effort required from the banking sector
at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco
Esp\u00edrito Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to
EUR 4,953 million, of which EUR 4,253 million were granted by the Portuguese State and EUR 700 million were
granted by a group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on
the use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and
financial balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on
regular revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and
released on 12 July 2022, \"the repayment of the EUR 2,130 million loans granted by the Portuguese State to the
Resolution Fund will not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or
in 2059 (with the use of the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid
in 2062\u201d.
On 2 October 2017, by Resolution 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to
make available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary,
to satisfy any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-
mentioned resolution further set out that the framework agreement should be subject to a time period that is
consistent with the undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to
satisfy said obligations in due time.
As at 31 December 2024, the Resolution Fund's own resources had a negative equity of EUR 6,475.8 million, as
opposed to EUR 6,735.1 million at the end of 2023, according to the latest 2024 Annual Report of the Resolution
Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives
proceeds from the initial and regular contributions from the participating institutions (including the Bank) and
from the contribution over the banking sector (created under Law 55-A/2010). It is also provided for the possibility
of the member of the Government responsible for the area of Finance to determine, by ordinance that the
participating institutions make special contributions, in the situations provided for in the applicable legislation,
particularly if the Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying,
since 2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the
occurrence of the event which creates the obligation to pay the contribution, i.e. on the last day of April of each
year, as stipulated in Article 9 of the referred Decree-Law 24/2013, of 19 February, thus the Bank is recognising as
an expense the contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 14/2025, published on 15 December 2025, set the base rate for 2026 for the
determination of periodic contributions to the Resolution Fund at 0.047% (0.049% in 2025).
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a
proposal with respect to the determination of amounts, time limits, payment methods, and any other terms
related to the special contributions to be made by the institutions participating in the Resolution Fund. According
to public communications from both the Resolution Fund and from the Government, there is no indication that
any such special contributions are foreseen.
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is
not expected that the Resolution Fund will propose the setting up of a special contribution to finance the
resolution measure applied to BES. Therefore, the potential collection of a special contribution appears to be
unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in
the amount of EUR 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to
partially cover for the disbursements made by the Resolution Fund in respect of resolution measures prior to the
date of application of this Agreement. This amount will have to be reinstated over a period of 8 years (started in
2016) through the periodic contributions to the SRF. The Single Resolution Fund does not cover undergoing
situations with the National Resolution Fund as at 31 December 2015. In 2024, no contribution was made to the
Single Resolution Fund attributable to the Group (BCP and ActivoBank) according to information from the SRB \u2013
Single Resolution Board of 10 February 2025, which states that the financial means available in the Single
Resolution Fund at 31 December 2024 remains above the target level of at least 1% of covered deposits held in the
Member States participating in the Single Resolution Mechanism, as set in article 69 (1) of Regulation (EU)
806/2014.
In 2025, the Group made regular contributions to the Portuguese Resolution Fund in the amount of EUR 10,166
thousand. The amount related to the contribution on the banking sector in Portugal, recorded in this period was
EUR 28,560 thousand. These contributions were recognised as a cost in the first half of 2025, in accordance with
IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, according to note 27 of the 2024 Resolution Fund\u2019s annual report to assess the
effects on the Resolution Fund due to: (i) the sale of the shareholding in Novo Banco in accordance with the
communication of Banco de Portugal dated 18 October 2017 and the information provided by the European
Commission on this subject under the terms described above; (ii) the application of the principle that no creditor
of the credit institution under resolution may take on a loss greater than the one it would take if that institution
did not go into liquidation; and (iii) legal proceedings against the Resolution Fund.
13. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution
adopted by Banco de Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation
adopted by the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent
capitalisation agreement under which the Resolution Fund commits to inject capital in Novo Banco up to EUR 3,9
billion, under determined circumstances. In the proceedings, the claimants request the declaration of nullity or
annulment of those acts.
The proceedings were filed based on the information contained in the Communication from Banco de Portugal
dated 31 March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September
2017. Banco de Portugal and the Resolution Fund presented their arguments and, only very recently, Nani
Holdings SGPS, S.A. did the same since, by delay of the court, this company was only very recently notified to act as
a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Banco de Portugal cannot be challenged and (iii) the material incompetence
of the court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an
opponent party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the
opponent party. After the presentation of the arguments, Banco de Portugal attached to the proceedings what it
called an evidence process (allegedly in compliance with the law) but most of the documents delivered were
truncated in such a way that neither the court nor the claimants are able to obtain adequate knowledge thereof.
That issue was already raised in the proceedings (requesting the court to order Banco de Portugal to deliver a true
evidence process) but no decision thereon has been made yet.
The proceeding was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal
opinions to the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
On 31 December 2025, the proceedings are prepared for confirmation of the decision accepting the formalities of
the right of action (with the making of a decision on the specific objections invoked). In case the judge considers
that Novo Banco is an opponent party, the judge must start by issuing a pre-confirmation in order to request the
claimants to identify it. Afterwards, that Bank will be notified to present its opposition arguments.
On 31 December 2025, the proceedings have not progressed and are still before the judge (for a possible decision
on the reorganisation of the case).
By application dated 7 January 2026, the Bank took advantage of the Court's invitation to rule on the updating of
the data of the Counterparty Nani Holdings, SGPS, S.A., to submit a set of supervening documents to the case-files
and request the continuation of the proceedings.
Since the case has not undergone any developments since the end of the written proceedings (in 2018), it is not
possible to have a non-speculative expectation of its development or timetable for its conclusion, and it is not
anticipated that the agreement for the sale of NB will influence this timetable.
14. The Bank was subject to tax inspections for the years up to 2022. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the
case of indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of
determining the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/
corrections made by the tax administration were the object of contestation by administrative and/or judicial
means.
The Bank recorded provisions, current tax liabilities or deferred tax liabilities at the amount considered sufficient to
offset the tax or tax loss carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by
the tax administration.
15. Bank Millennium is a party to proceedings initiated by the President of UOKiK regarding the recognition of
certain provisions of a contract template as abusive. The proceedings concern modification clauses indicating the
circumstances in which the Bank is entitled to amend the terms and conditions and the fees and commissions
price lists. According to UOKiK, these clauses grant the Bank unlimited discretion in shaping the content of the
contract, which may violate good practice and grossly infringe the interests of consumers. The Bank challenged
the validity of these allegations, indicating that the provisions are precise and clearly define the conditions for their
application. The President of UOKiK extended the proceedings until 25 June 2026.
Bank Millennium is also a party to proceedings initiated by the President of UOKiK regarding the modification
clauses used by Euro Bank S.A., for which Bank Millennium S.A. is the legal successor. The President of UOKiK
extended these proceedings until 31 August 2026.
", "dimensions": { "concept": "ifrs-full:DisclosureOfContingentLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-733": { "value": "Legal risk related to foreign currency mortgage loans in Bank Millennium
(Poland)
1. Court claims and current provisions for legal risk
On 31 December 2025, Bank Millennium had 16,653 loan agreements and additionally 2,285 loan agreements from
former Euro Bank under individual ongoing litigations (excluding claims submitted by Bank Millennium against
clients i.e. debt collection cases) concerning indexation clauses of FX mortgage loans submitted to the courts (43%
loans agreements before the courts of first instance and 57% loans agreements before the courts of second
instance) with the total value of claims filed by the plaintiffs amounting to PLN 3,551.2 million (EUR 841 million) and
CHF 293.2 million (EUR 315.1 million) [(Bank Millennium portfolio: PLN 3,057.8 million (EUR 724.1 million) and CHF
281.4 million (EUR 302.5 million) and former Euro Bank portfolio: PLN 493.4 million (EUR 116.8 million) and CHF 11.8
million (EUR 12.7 million)]. The original value of the portfolio of CHF agreements granted (the sum of tranches paid
to customers), taking into account the exchange rate as at the date of disbursement of loan tranches, amounted
to PLN 19.4 billion (EUR 4.6 billion) for 109 thousand loan agreements (Bank Millennium portfolio: PLN 18.3 billion
(EUR 4.3 billion) for 103.8 thousand loan agreements and former Euro Bank portfolio: PLN 1.1 billion (EUR 0.3 billion)
for 5.2 thousand loan agreements). Out of 16,653 Bank Millennium's loan agreements in ongoing individual cases
426 are also part of class action. From the total number of individual litigations against the Bank approximately
4,380 or 26% were submitted by borrowers that did not have any active loans with a CHF balance at the moment
of submission. Approximately another 1,170 cases correspond to loans that were fully repaid during the
proceedings (as court proceedings are lengthy).
The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the
contract and payment for reimbursement of paid principal and interest instalments as undue performance, due
to the abusive nature of indexation clauses, or maintenance of the agreement in PLN with interest rate indexed to
CHF Libor (currently CHF Saron).
In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to
determine the Bank's liability towards the group members based on unjust enrichment (undue benefit) ground in
connection with the foreign currency mortgage loans concluded. It is not a payment dispute. The judgment in
these proceedings will not directly grant any amounts to the group members. The number of credit agreements
currently covered by these proceedings is 1,389. Out of 1,389 loan agreements in class action 426 are also part of
ongoing individual cases, 27 concluded settlements and 15 received final verdicts (invalidation of loan agreement).
On 24 May 2022 the court issued a judgment on the merits, dismissing the claim in full. On 13 December 2022 the
claimant filed an appeal against the judgment of 24 May 2022. On 25 June 2024 an appeal hearing was held, at
which the Bank filed a motion to amend the composition of the group and exclude those group members who
had entered into an amicable settlement. The court required the plaintiffs' attorneys to take a written position on
the current composition of the group. On 31 January 2025, and then on 25 March 2025, 8 May 2025, 6 June 2025, 30
July 2025, 1 September 2025, 6 October 2025, 24 November 2025, 15 December 2025 and 13 January 2026, the court
issued orders setting aside the judgment and discontinuing the proceedings from the persons who entered into
amicable settlements. On January 19, 2026, another appellate hearing took place, during which the Court obliged
both the claimant and the Bank to further specify the composition of the group. The next hearing date will be
scheduled ex officio.
Based on these orders, the number of credit agreements covered by the class action dropped from 3,273 to 1,389.
Until the end of 2019, 1,980 individual claims were filed against Bank Millennium (in addition, 235 against former
Euro Bank), in 2020 3,002 (265), in 2021 6,151 (421), in 2022 5,754 (407), in 2023 6,864 (645), in 2024 5,838 (655) and in
2025 3,712 (427).
As far as Bank Millennium (including the former Euro Bank portfolio) is concerned, from 2015 until the end of 2025,
17,730 cases were finally resolved (17,593 in claims submitted by clients against the Bank and 137 in claims
submitted by the Bank against clients i.e. debt collection cases) out of which 5,488 were settlements, 136 were
remissions, 89 rulings were favourable for the Bank and 12,017 were unfavourable including both invalidation of
loan agreements as well as conversions into PLN+LIBOR (currently Saron). Bank Millennium undertakes proper
legal actions in order to secure repayment of initially disbursed capital of the loan.
The methodology developed by Bank Millennium of calculating provisions for legal risk involved with indexed
loans is based on the following main parameters:
(1) the number of ongoing cases (including class action agreements);
(2) the number of potential future court cases, the Bank monitors customer behaviours, analyses their willingness
to sue the Bank, including due to economic factors and applies the following assumptions:
a. regarding active loans (i.e., loans with an outstanding balance), the Bank estimates that approximately
18% of them will neither sign an out-of-court settlement nor decide to file a lawsuit;
b. regarding loans already fully repaid or converted to polish zloty, the Bank anticipates that approximately
4.7 thousand repaid loans - those which were not previously subject to a settlement - may result in future
litigation initiated by the borrowers. The impact on the level of provisions of a change by 100 clients
(assuming recent inflow structure) would be around PLN 14.4 million (EUR 3.4 million);
(3) the amount of the Bank's potential loss in the event of a specific court judgment (including statutory interest
estimation significantly dependent on the period for which they are awarded);
(4) estimates involved with amicable settlements with clients, concluded in court or out of court.
As a result of negotiations, the number of active FX mortgage loans originated by Bank Millennium decreased by
30,369. As of the end of 2025, the Bank had 14,741 active FX mortgage loans.
The costs regarding to legal risk related to foreign\u2011currency mortgage loans are presented in the following table:
31 December 2025
31 December 2024
Item
note
thousand PLN
thousand EUR
thousand PLN
thousand EUR
Results on modification
10
10,584
2,499
146,600
34,055
Other operating income/(expenses)
6
33,864
7,994
121,155
28,144
Foreign exchange gains/(losses)
5
22,339
5,274
403,405
93,711
Charge of other provisions
14
2,037,431
480,973
2,179,070
506,195
Total costs
2,104,218
496,740
2,850,230
662,105
Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A.
Over the past years, the Court of Justice of the European Union (CJEU) has interpreted a number of legal issues
concerning disputes in the area of foreign currency housing loan agreements. As a result of these actions, the
legal assessments of national courts regarding claims submitted by borrowers have been significantly unified. The
established line of case law is generally favourable to consumers, and the legal arguments put forward by banks,
including those referring to principles of fairness, are taken into account only to a limited extent.
It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further
examined by the domestic courts and the European Court of Justice which could potentially result in the further
interpretations, that are relevant for the assessing of the risks associated with proceedings.
The issues related to the statute of limitations for the Bank Millennium's and the customer's restitutionary claims
following the invalidation of a loan agreement remain an area that may be subject to further analysis in the
jurisprudence of Polish courts. Legal interpretations in this subject may have an impact for the amount of
provisions in the future.
There is a need for constant analysis of these matters. Bank Millennium will have to regularly review and may need
to continue to create additional provisions for FX mortgage legal risk, taking into consideration not only the above
mentioned developments, but also the negative verdicts in the courts regarding FX mortgage loans and
important parameters, such as the number of new customer claims, including those relating to repaid loan
agreements.
On 2 October 2025, the Council of Ministers adopted a draft act on special solutions for the examination of cases
concerning loan agreements denominated or indexed to the Swiss franc and referred it to the Parliament. The first
reading of the draft act took place on 16 October 2025. The draft was referred for further parliamentary work.
The bill aims to create new regulations enabling courts to consider Swiss franc cases faster and more effectively.
Its primary task is to relieve the judiciary, by accelerating the examination of Swiss franc cases.
At present, the Bank Millennium is unable to estimate the impact of the ongoing legislative work on the Bank\u2019s
Financial Statements, but it does not alter the Bank\u2019s strategic approach, which remains focused on the amicable
resolution of disputes with clients through the conclusion of settlement agreements.
Selected theses and decisions of the CJEU and the Supreme Court that have shaped the line
of jurisprudence.
Case law of the Court of Justice of the European Union
On 3 October 2019, in case C 260/18, the CJEU ruled that a national court may annul a credit agreement if the
removal of unfair terms identified in that agreement would alter the nature of the main subject matter of the
contract, and that it is excluded to fill the gaps in the agreement caused by the removal of unfair terms solely on
the basis of national legislation of a general nature or on the basis of accepted customs. The Court also found that
the consumer, if he or she so wishes, may maintain the agreement in force.
On 10 June 2021, the CJEU found that the protection provided for in Directive 93/13/EEC applies to every consumer,
and not only to one who may be regarded as a \u201creasonably well informed, observant and circumspect average
consumer\u201d.
With regard to the definition of a consumer, on 8 June 2023, in case C 570/21, the CJEU ruled that the notion of
\u201cconsumer\u201d within the meaning of Directive 93/13 also includes a person who concluded a credit agreement for
use partly related to his or her business or professional activity.
On 15 June 2023, in case C 520/21, the CJEU, referring to the issue of settlements between the bank and the
consumer as a consequence of the annulment of a credit agreement, explained that the provisions of Directive
93/13 preclude a judicial interpretation of national law under which a credit institution has the right to demand
from the consumer compensation exceeding the return of the capital disbursed under the performance of that
agreement, as well as exceeding statutory default interest from the date of the demand for payment.
On 21 September 2023, in case C 139/22, the Court ruled that it is possible to consider a contractual term unfair
solely because its content is equivalent to the content of a clause included in the national register of unfair terms.
Moreover, the CJEU held that a contractual term found to be unfair cannot lose that character because of another
provision of the same agreement that provides the consumer with the possibility of performing obligations under
different conditions. Furthermore, the trader is obliged to inform the concerned consumer about the essential
features of the agreement concluded with him or her, as well as about the risks connected with that agreement,
even if that consumer is the trader\u2019s employee and has relevant knowledge in the field of that agreement.
On 7 December 2023, in case C 140/22, the Court ruled that the exercise of a consumer\u2019s rights cannot be made
conditional upon the consumer submitting to the court, in particular, a statement declaring that he or she agrees
to the recognition of the agreement as null and void.
On 14 December 2023, in case C 28/22, the Court ruled that the limitation period for the trader\u2019s claims arising from
the invalidity of the agreement cannot begin later than the limitation period for the consumer\u2019s claims arising
from the invalidity of that agreement. The Court also indicated, among other things, that the trader cannot rely on
the right of retention that would allow him to make the return of the benefits received from the consumer
conditional upon the consumer offering to return the benefits he or she received, if the exercise of this right of
retention would cause the consumer to lose the right to obtain default interest.
The Court of Justice of the European Union on 19 June 2025 issued a judgment in case C 396/24. The Court stated
in particular that a trader, in the case of the invalidity of the agreement, may not demand from the consumer the
return of the entire nominal amount of the credit granted, regardless of the amount of repayments made by the
consumer under that agreement and regardless of the amount remaining to be repaid.
In its judgment of 27 November 2025, in case C 746/24, the CJEU addressed the possibility of charging the
consumer with the costs of legal proceedings lost by the consumer concerning the repayment of the capital
disbursed by the bank. The Court found that it is not permissible to charge the consumer with costs that
significantly exceed the costs that the consumer would have had to bear had he or she lost the case in
proceedings initiated to challenge the unfairness of the credit agreement terms.
On 11 December 2025, in case C 767/24, the CJEU held that in the event of the invalidity of a credit agreement, the
submission by the consumer of a statement on the set off of his or her claim with the bank\u2019s claim does not entail
an implied waiver of the statute of limitations defence.
On 22 January 2026 in case C 902/24, the CJEU stated that the provisions of Directive 93/13 do not preclude a
judicial interpretation of national law that, within proceedings initiated by a consumer for the purpose of
establishing the invalidity of a mortgage loan agreement, allows the trader, while maintaining as the main
argument that the agreement is valid, to raise alternatively a set off defence based on a claim corresponding to
the amount of that mortgage loan, provided that, first, that latter claim is not considered due before the
competent court establishes the invalidity of the agreement itself, and second, that the acceptance of such a
defence does not lead to a decision on costs that could discourage the consumer from exercising the rights
granted to him or her under that Directive.
Jurisprudence of the Polish Supreme Court
The case law of the Supreme Court remains consistent with the guidance of the Court of Justice of the European
Union.
On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the
meaning of legal principle has been granted, stating that:
1. An abusive contractual clause (art. 385(1) \u00a7 1 of the Civil Code), by force of the law itself, is ineffective to the benefit
of the consumer who may consequently give conscious and free consent to this clause and thus restore its
effectiveness retroactively.
2. If without the ineffective clause the loan agreement cannot bind, the consumer and the lender shall be eligible
for separate claims for return of monetary performances made in exercising this agreement (art. 410 \u00a7 1 in relation
to art. 405 of the Civil Code). The lender may demand return of the performance from the moment the loan
agreement becomes permanently ineffective.
On 28 April 2022 the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with
consumers, the provision of Article 358(1) of the Civil Code is a special provision to Article 353(1) of the Civil Code,
which means that if the prerequisites for the application of both provisions exist, the court should apply the
special provision and declare the contractual provision permanently ineffective, rather than invalid.
The effect of the Supreme Court's resolution of 7 May 2021 is that the bank is entitled to a refund of the cash
benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the
uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to
protect its interests, files lawsuits for payment against borrowers in a court dispute with the Bank and in other
circumstances where such risk may exist. The Bank's demand consists of a claim for return of the capital made
available to the borrower under the contract. By 31 December 2025 Bank Millennium filed 18,191 lawsuits against
the borrowers.
On 25 April 2024, a session of the Civil Chamber of the Supreme Court was held to answer questions formulated by
the First President of the Supreme Court, published on 29 January 2021, on key issues related to foreign currency
mortgage loan agreements. The Supreme Court, composed of the entire Civil Chamber, adopted a resolution
having the force of a legal principle, in which it stated that:
a. When finding that a provision of an indexed or denominated credit agreement relating to the manner of
determining the foreign currency exchange rate constitutes an unfair contractual provision and is not binding,
then in currently existing legal situation it cannot be stated that such a provision could be replaced by another
formula of defining the foreign currency exchange rate resulting from law or custom.
b. In case of impossibility to determine the foreign currency exchange rate binding the parties in the indexed or
denominated loan agreement, the agreement is not binding also in the remaining scope.
c. If, in the performance of a credit agreement which is not binding due to the unfair nature of its provisions, the
bank has disbursed to the borrower all or part of the amount of the credit and the borrower has made
repayments of the credit, independent claims for repayment of the undue performance shall arise in favour of
each party.
d. If a credit agreement is not binding due to the unfair nature of its provisions, the statute of limitations of the
bank's claim for repayment of amounts disbursed under the credit shall, as a rule, start to run from the day
following the day on which the borrower challenges being bound by the provisions of agreement.
e. If a credit agreement is not binding due to the unfair nature of its provisions, there shall be no legal basis for
any party to claim interest or other remuneration because of using party's pecuniary means during the period
from the provision of undue benefit until the delay in the return of this benefit.
On 19 June 2024, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 31/23)
stating that:
The right of retention (Article 496 of the Civil Code) does not apply to the party that can set off its claim against the
claim of the other party.
On 28 February 2025, the Supreme Court issued a resolution of 7 judges of the Supreme Court (III CZP 126/22), in
which it stated that:
(i) A bank loan agreement (Article 69(1) of the Banking Law Act of 29 August 1997) is a mutual agreement within
the meaning of Article 487 \u00a7 2 of the Civil Code.
On 5 March 2025 the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 37/24), in
which it stated that:
(i) In the event of a claim for repayment from a bank of a consideration fulfilled on the basis of a credit agreement
which has proved to be invalid, the bank is not entitled to the right of retention under Article 496 in connection
with Article 497 of the Civil Code.
On 15 May 2025, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 22/24), in
which it indicated that:
(i) Under the legal state in force until 30 June 2022, a request for a settlement attempt interrupted the limitation
period of the claim, unless the circumstances of making this action indicate that it was not undertaken directly for
the purpose of pursuing or determining, or satisfying or securing the claim (Article 123 \u00a7 1 point 1 of the Civil Code).
Due to the CJEU jurisprudence interpreting the causes and effects of invalidity of foreign currency mortgage loan
agreements as well as above indicated resolution of the Civil Chamber of the Supreme Court, the area of
interpretation of regulations by Polish courts in this respect appears to be limited. However, further jurisprudential
practice of the Polish courts will play certain role in practical realisation of the CJEU's and the Supreme Court\u2019s
guidance.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAssetsAndLiabilitiesWithSignificantRiskOfMaterialAdjustmentExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-732": { "value": "Legal risk related to foreign currency mortgage loans in Bank Millennium (Poland)1. Court claims and current provisions for legal riskOn 31 December 2025, Bank Millennium had 16,653 loan agreements and additionally 2,285 loan agreements from former Euro Bank under individual ongoing litigations (excluding claims submitted by Bank Millennium against clients i.e. debt collection cases) concerning indexation clauses of FX mortgage loans submitted to the courts (43% loans agreements before the courts of first instance and 57% loans agreements before the courts of second instance) with the total value of claims filed by the plaintiffs amounting to PLN 3,551.2 million (EUR 841 million) and CHF 293.2 million (EUR 315.1 million) [(Bank Millennium portfolio: PLN 3,057.8 million (EUR 724.1 million) and CHF 281.4 million (EUR 302.5 million) and former Euro Bank portfolio: PLN 493.4 million (EUR 116.8 million) and CHF 11.8 million (EUR 12.7 million)]. The original value of the portfolio of CHF agreements granted (the sum of tranches paid to customers), taking into account the exchange rate as at the date of disbursement of loan tranches, amounted to PLN 19.4 billion (EUR 4.6 billion) for 109 thousand loan agreements (Bank Millennium portfolio: PLN 18.3 billion (EUR 4.3 billion) for 103.8 thousand loan agreements and former Euro Bank portfolio: PLN 1.1 billion (EUR 0.3 billion) for 5.2 thousand loan agreements). Out of 16,653 Bank Millennium's loan agreements in ongoing individual cases 426 are also part of class action. From the total number of individual litigations against the Bank approximately 4,380 or 26% were submitted by borrowers that did not have any active loans with a CHF balance at the moment of submission. Approximately another 1,170 cases correspond to loans that were fully repaid during the proceedings (as court proceedings are lengthy).The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the contract and payment for reimbursement of paid principal and interest instalments as undue performance, due to the abusive nature of indexation clauses, or maintenance of the agreement in PLN with interest rate indexed to CHF Libor (currently CHF Saron).In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to determine the Bank's liability towards the group members based on unjust enrichment (undue benefit) ground in connection with the foreign currency mortgage loans concluded. It is not a payment dispute. The judgment in these proceedings will not directly grant any amounts to the group members. The number of credit agreements currently covered by these proceedings is 1,389. Out of 1,389 loan agreements in class action 426 are also part of ongoing individual cases, 27 concluded settlements and 15 received final verdicts (invalidation of loan agreement). On 24 May 2022 the court issued a judgment on the merits, dismissing the claim in full. On 13 December 2022 the claimant filed an appeal against the judgment of 24 May 2022. On 25 June 2024 an appeal hearing was held, at which the Bank filed a motion to amend the composition of the group and exclude those group members who had entered into an amicable settlement. The court required the plaintiffs' attorneys to take a written position on the current composition of the group. On 31 January 2025, and then on 25 March 2025, 8 May 2025, 6 June 2025, 30 July 2025, 1 September 2025, 6 October 2025, 24 November 2025, 15 December 2025 and 13 January 2026, the court issued orders setting aside the judgment and discontinuing the proceedings from the persons who entered into amicable settlements. On January 19, 2026, another appellate hearing took place, during which the Court obliged both the claimant and the Bank to further specify the composition of the group. The next hearing date will be scheduled ex officio. Based on these orders, the number of credit agreements covered by the class action dropped from 3,273 to 1,389.Until the end of 2019, 1,980 individual claims were filed against Bank Millennium (in addition, 235 against former Euro Bank), in 2020 3,002 (265), in 2021 6,151 (421), in 2022 5,754 (407), in 2023 6,864 (645), in 2024 5,838 (655) and in 2025 3,712 (427).As far as Bank Millennium (including the former Euro Bank portfolio) is concerned, from 2015 until the end of 2025, 17,730 cases were finally resolved (17,593 in claims submitted by clients against the Bank and 137 in claims submitted by the Bank against clients i.e. debt collection cases) out of which 5,488 were settlements, 136 were remissions, 89 rulings were favourable for the Bank and 12,017 were unfavourable including both invalidation of loan agreements as well as conversions into PLN+LIBOR (currently Saron). Bank Millennium undertakes proper legal actions in order to secure repayment of initially disbursed capital of the loan.The methodology developed by Bank Millennium of calculating provisions for legal risk involved with indexed loans is based on the following main parameters: (1) the number of ongoing cases (including class action agreements); (2) the number of potential future court cases, the Bank monitors customer behaviours, analyses their willingness to sue the Bank, including due to economic factors and applies the following assumptions:a. regarding active loans (i.e., loans with an outstanding balance), the Bank estimates that approximately 18% of them will neither sign an out-of-court settlement nor decide to file a lawsuit;b. regarding loans already fully repaid or converted to polish zloty, the Bank anticipates that approximately 4.7 thousand repaid loans - those which were not previously subject to a settlement - may result in future litigation initiated by the borrowers. The impact on the level of provisions of a change by 100 clients (assuming recent inflow structure) would be around PLN 14.4 million (EUR 3.4 million);(3) the amount of the Bank's potential loss in the event of a specific court judgment (including statutory interest estimation significantly dependent on the period for which they are awarded);(4) estimates involved with amicable settlements with clients, concluded in court or out of court.As a result of negotiations, the number of active FX mortgage loans originated by Bank Millennium decreased by 30,369. As of the end of 2025, the Bank had 14,741 active FX mortgage loans. The costs regarding to legal risk related to foreign\u2011currency mortgage loans are presented in the following table:31 December 2025 31 December 2024 Item note thousand PLN thousand EUR thousand PLN thousand EUR Results on modification 1010,5842,499146,60034,055Other operating income/(expenses) 633,8647,994121,15528,144Foreign exchange gains/(losses) 522,3395,274403,40593,711Charge of other provisions 142,037,431480,9732,179,070506,195Total costs 2,104,218496,7402,850,230662,105Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Soci\u00e9t\u00e9 G\u00e9n\u00e9rale S.A.Over the past years, the Court of Justice of the European Union (CJEU) has interpreted a number of legal issues concerning disputes in the area of foreign currency housing loan agreements. As a result of these actions, the legal assessments of national courts regarding claims submitted by borrowers have been significantly unified. The established line of case law is generally favourable to consumers, and the legal arguments put forward by banks, including those referring to principles of fairness, are taken into account only to a limited extent.It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further examined by the domestic courts and the European Court of Justice which could potentially result in the further interpretations, that are relevant for the assessing of the risks associated with proceedings. The issues related to the statute of limitations for the Bank Millennium's and the customer's restitutionary claims following the invalidation of a loan agreement remain an area that may be subject to further analysis in the jurisprudence of Polish courts. Legal interpretations in this subject may have an impact for the amount of provisions in the future.There is a need for constant analysis of these matters. Bank Millennium will have to regularly review and may need to continue to create additional provisions for FX mortgage legal risk, taking into consideration not only the above mentioned developments, but also the negative verdicts in the courts regarding FX mortgage loans and important parameters, such as the number of new customer claims, including those relating to repaid loan agreements.On 2 October 2025, the Council of Ministers adopted a draft act on special solutions for the examination of cases concerning loan agreements denominated or indexed to the Swiss franc and referred it to the Parliament. The first reading of the draft act took place on 16 October 2025. The draft was referred for further parliamentary work.The bill aims to create new regulations enabling courts to consider Swiss franc cases faster and more effectively. Its primary task is to relieve the judiciary, by accelerating the examination of Swiss franc cases. At present, the Bank Millennium is unable to estimate the impact of the ongoing legislative work on the Bank\u2019s Financial Statements, but it does not alter the Bank\u2019s strategic approach, which remains focused on the amicable resolution of disputes with clients through the conclusion of settlement agreements.Selected theses and decisions of the CJEU and the Supreme Court that have shaped the line of jurisprudence.Case law of the Court of Justice of the European UnionOn 3 October 2019, in case C 260/18, the CJEU ruled that a national court may annul a credit agreement if the removal of unfair terms identified in that agreement would alter the nature of the main subject matter of the contract, and that it is excluded to fill the gaps in the agreement caused by the removal of unfair terms solely on the basis of national legislation of a general nature or on the basis of accepted customs. The Court also found that the consumer, if he or she so wishes, may maintain the agreement in force.On 10 June 2021, the CJEU found that the protection provided for in Directive 93/13/EEC applies to every consumer, and not only to one who may be regarded as a \u201creasonably well informed, observant and circumspect average consumer\u201d.With regard to the definition of a consumer, on 8 June 2023, in case C 570/21, the CJEU ruled that the notion of \u201cconsumer\u201d within the meaning of Directive 93/13 also includes a person who concluded a credit agreement for use partly related to his or her business or professional activity.On 15 June 2023, in case C 520/21, the CJEU, referring to the issue of settlements between the bank and the consumer as a consequence of the annulment of a credit agreement, explained that the provisions of Directive 93/13 preclude a judicial interpretation of national law under which a credit institution has the right to demand from the consumer compensation exceeding the return of the capital disbursed under the performance of that agreement, as well as exceeding statutory default interest from the date of the demand for payment.On 21 September 2023, in case C 139/22, the Court ruled that it is possible to consider a contractual term unfair solely because its content is equivalent to the content of a clause included in the national register of unfair terms. Moreover, the CJEU held that a contractual term found to be unfair cannot lose that character because of another provision of the same agreement that provides the consumer with the possibility of performing obligations under different conditions. Furthermore, the trader is obliged to inform the concerned consumer about the essential features of the agreement concluded with him or her, as well as about the risks connected with that agreement, even if that consumer is the trader\u2019s employee and has relevant knowledge in the field of that agreement.On 7 December 2023, in case C 140/22, the Court ruled that the exercise of a consumer\u2019s rights cannot be made conditional upon the consumer submitting to the court, in particular, a statement declaring that he or she agrees to the recognition of the agreement as null and void.On 14 December 2023, in case C 28/22, the Court ruled that the limitation period for the trader\u2019s claims arising from the invalidity of the agreement cannot begin later than the limitation period for the consumer\u2019s claims arising from the invalidity of that agreement. The Court also indicated, among other things, that the trader cannot rely on the right of retention that would allow him to make the return of the benefits received from the consumer conditional upon the consumer offering to return the benefits he or she received, if the exercise of this right of retention would cause the consumer to lose the right to obtain default interest.The Court of Justice of the European Union on 19 June 2025 issued a judgment in case C 396/24. The Court stated in particular that a trader, in the case of the invalidity of the agreement, may not demand from the consumer the return of the entire nominal amount of the credit granted, regardless of the amount of repayments made by the consumer under that agreement and regardless of the amount remaining to be repaid.In its judgment of 27 November 2025, in case C 746/24, the CJEU addressed the possibility of charging the consumer with the costs of legal proceedings lost by the consumer concerning the repayment of the capital disbursed by the bank. The Court found that it is not permissible to charge the consumer with costs that significantly exceed the costs that the consumer would have had to bear had he or she lost the case in proceedings initiated to challenge the unfairness of the credit agreement terms.On 11 December 2025, in case C 767/24, the CJEU held that in the event of the invalidity of a credit agreement, the submission by the consumer of a statement on the set off of his or her claim with the bank\u2019s claim does not entail an implied waiver of the statute of limitations defence.On 22 January 2026 in case C 902/24, the CJEU stated that the provisions of Directive 93/13 do not preclude a judicial interpretation of national law that, within proceedings initiated by a consumer for the purpose of establishing the invalidity of a mortgage loan agreement, allows the trader, while maintaining as the main argument that the agreement is valid, to raise alternatively a set off defence based on a claim corresponding to the amount of that mortgage loan, provided that, first, that latter claim is not considered due before the competent court establishes the invalidity of the agreement itself, and second, that the acceptance of such a defence does not lead to a decision on costs that could discourage the consumer from exercising the rights granted to him or her under that Directive.Jurisprudence of the Polish Supreme CourtThe case law of the Supreme Court remains consistent with the guidance of the Court of Justice of the European Union.On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the meaning of legal principle has been granted, stating that: 1. An abusive contractual clause (art. 385(1) \u00a7 1 of the Civil Code), by force of the law itself, is ineffective to the benefit of the consumer who may consequently give conscious and free consent to this clause and thus restore its effectiveness retroactively.2. If without the ineffective clause the loan agreement cannot bind, the consumer and the lender shall be eligible for separate claims for return of monetary performances made in exercising this agreement (art. 410 \u00a7 1 in relation to art. 405 of the Civil Code). The lender may demand return of the performance from the moment the loan agreement becomes permanently ineffective.On 28 April 2022 the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with consumers, the provision of Article 358(1) of the Civil Code is a special provision to Article 353(1) of the Civil Code, which means that if the prerequisites for the application of both provisions exist, the court should apply the special provision and declare the contractual provision permanently ineffective, rather than invalid. The effect of the Supreme Court's resolution of 7 May 2021 is that the bank is entitled to a refund of the cash benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to protect its interests, files lawsuits for payment against borrowers in a court dispute with the Bank and in other circumstances where such risk may exist. The Bank's demand consists of a claim for return of the capital made available to the borrower under the contract. By 31 December 2025 Bank Millennium filed 18,191 lawsuits against the borrowers. On 25 April 2024, a session of the Civil Chamber of the Supreme Court was held to answer questions formulated by the First President of the Supreme Court, published on 29 January 2021, on key issues related to foreign currency mortgage loan agreements. The Supreme Court, composed of the entire Civil Chamber, adopted a resolution having the force of a legal principle, in which it stated that:a. When finding that a provision of an indexed or denominated credit agreement relating to the manner of determining the foreign currency exchange rate constitutes an unfair contractual provision and is not binding, then in currently existing legal situation it cannot be stated that such a provision could be replaced by another formula of defining the foreign currency exchange rate resulting from law or custom.b. In case of impossibility to determine the foreign currency exchange rate binding the parties in the indexed or denominated loan agreement, the agreement is not binding also in the remaining scope.c. If, in the performance of a credit agreement which is not binding due to the unfair nature of its provisions, the bank has disbursed to the borrower all or part of the amount of the credit and the borrower has made repayments of the credit, independent claims for repayment of the undue performance shall arise in favour of each party.d. If a credit agreement is not binding due to the unfair nature of its provisions, the statute of limitations of the bank's claim for repayment of amounts disbursed under the credit shall, as a rule, start to run from the day following the day on which the borrower challenges being bound by the provisions of agreement.e. If a credit agreement is not binding due to the unfair nature of its provisions, there shall be no legal basis for any party to claim interest or other remuneration because of using party's pecuniary means during the period from the provision of undue benefit until the delay in the return of this benefit.On 19 June 2024, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 31/23) stating that:The right of retention (Article 496 of the Civil Code) does not apply to the party that can set off its claim against the claim of the other party.On 28 February 2025, the Supreme Court issued a resolution of 7 judges of the Supreme Court (III CZP 126/22), in which it stated that:(i) A bank loan agreement (Article 69(1) of the Banking Law Act of 29 August 1997) is a mutual agreement within the meaning of Article 487 \u00a7 2 of the Civil Code.On 5 March 2025 the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 37/24), in which it stated that:(i) In the event of a claim for repayment from a bank of a consideration fulfilled on the basis of a credit agreement which has proved to be invalid, the bank is not entitled to the right of retention under Article 496 in connection with Article 497 of the Civil Code.On 15 May 2025, the Supreme Court issued a resolution by a panel of 7 Supreme Court judges (III CZP 22/24), in which it indicated that: (i) Under the legal state in force until 30 June 2022, a request for a settlement attempt interrupted the limitation period of the claim, unless the circumstances of making this action indicate that it was not undertaken directly for the purpose of pursuing or determining, or satisfying or securing the claim (Article 123 \u00a7 1 point 1 of the Civil Code).Due to the CJEU jurisprudence interpreting the causes and effects of invalidity of foreign currency mortgage loan agreements as well as above indicated resolution of the Civil Chamber of the Supreme Court, the area of interpretation of regulations by Polish courts in this respect appears to be limited. However, further jurisprudential practice of the Polish courts will play certain role in practical realisation of the CJEU's and the Supreme Court\u2019s guidance.", "dimensions": { "concept": "ifrs-full:ExplanationOfAssumptionAboutFutureWithSignificantRiskOfResultingInMaterialAdjustments", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-734": { "value": "Recently issued accounting standards and interpretations that came into force in
the current financial year
At the date of these financial statements, the following accounting standards, interpretations, amendments and
revisions were endorsed by the European Union (EU) with mandatory application for the financial year started on 1
January 2025:
Amendment to IAS 21: The Effects of Changes in Foreign Exchange Rates: Lack of
Exchangeability (applicable for years beginning on or after 1 January 2025)
This amendment was issued on 15 August 2023 and it provides the following changes:
\u2013 specify when a currency is exchangeable into another currency and when it is not;
\u2013 specify how an entity determines the exchange rate to apply when a currency is not exchangeable; and
\u2013 require the disclosure of additional information when a currency is not exchangeable.
Under the amendments, new disclosures regarding the impact of using an estimated exchange rate on the
financial statements, may include:
\u2013 the nature and financial impacts of the currency not being exchangeable;
\u2013 the spot exchange rate used;
\u2013 the estimation process; and
\u2013 the risks to wich the company is exposed because the currency is not exchangeable.
There were no material impacts on the application of this amendment in the Group's financial statements.
2 - Standards, interpretations, amendments and revisions that will take effect in future
financial years
The following standards, interpretations, amendments and revisions, with mandatory application in future
financial years, have been endorsed by the European Union until the date of these financial statements:
Amendments to IFRS 9 and IFRS 7 - Amendments to the Classification and Measurement of
Financial Instruments (applicable for years beginning on or after 1 January 2026)
This amendment was issued on 30 May 2024 and aim to improve clarity and relevance in the classification,
measurement, and disclosure of financial instruments.
These amendments aim to:
\u2013 Clarify the classification of financial assets with environmental, social, and corporate governance (ESG) and
similar features, as ESG-linked features in loans could affect whether the loans are measured at amortised cost
or fair value. To resolve any potential diversity in practice, the amendments clarify how the contractual cash
flows on such loans should be assessed.
\u2013 Clarify the date on which a financial asset or financial liability is derecognised when the settlement of liabilities
is made through electronic payment systems. There is an accounting policy option to allow a company to
derecognise a financial liability before it delivers cash on the settlement date if specified criteria are met.
\u2013 Enhance the description of the term \"non-recourse\", under the amendments, a financial asset has non-
recourse features if an entity\u2019s ultimate right to receive cash flows is contractually limited to the cash flows
generated by specified assets. The presence of non-recourse features does not necessarily preclude the
financial asset from meeting the SPPI criterion, but the features do need to be carefully considered.
\u2013 Clarify that a contractually linked instrument must feature a waterfall payment structure that creates
concentration of credit risk by allocating losses disproportionately between different tranches. The underlying
pool can include financial instruments not in the scope of IFRS 9 classification and measurement (e.g., lease
receivables) but must have cash flows that are equivalent to SPPI.
The IASB has also introduced additional disclosure requirements regarding investments in equity instruments
designated at fair value through other comprehensive income and financial instruments with contingent features,
for example features tied to ESG-linked targets.
The Group is currently assessing the potential impact resulting from the adoption of this amendment.
Amendments to IFRS 9 and IFRS 7 - Amendment to Contracts Referencing Nature-
dependent Electricity (applicable for years beginning on or after 1 January 2026)
This amendment was issued on 18 December 2024 and aims to help companies better report the financial effects
of nature-dependent electricity contracts, often structured as power purchase agreements (PPAs). These
contracts help secure electricity from renewable sources like wind and solar, with generation varying due to
uncontrollable factors such as weather conditions. Current accounting standards may not fully capture how these
contracts impact a company\u2019s performance. The amendments to IFRS 9 and IFRS 7 include clarifying the \u2018own use\u2019
requirements, permitting hedge accounting when these contracts are used as hedging instruments, and adding
new disclosure requirements to help investors understand the effect of these contracts on financial performance
and cash flows.
The Group is currently assessing the potential impact resulting from the adoption of this amendment.
Annual Improvements to IFRS Accounting Standards - Volume 11 (applicable for years
beginning on or after 1 January 2026)
This amendment was issued on 18 July 2024 and the IASB has proposed narrow-scope amendments to IFRS
Standards as part of its periodic maintenance, focusing on clarifying wording or addressing minor issues. The
proposed amendments, detailed in the Exposure Draft Annual Improvements to IFRS Accounting Standards -
Volume 11, cover topics such as hedge accounting for first-time adopters (IFRS 1), disclosures on derecognition and
credit risk (IFRS 7), lease liability derecognition (IFRS 9), initially measure a trade receivable without a significant
financing component at the amount determined by applying IFRS 15 (IFRS 9), determination of a \u2018de facto
agent\u2019 (IFRS 10), and the cost method in cash flow statements (IAS 7).
The Group is currently assessing the potential impact of annual improvements to IFRS.
IFRS 18: Presentation and Disclosure in Financial Statements (applicable for years beginning
on or after 1 January 2027)
This standard was issued on 9 April 2024 and aims to improve the disclosure of the financial performance of
entities and promote the provision of more transparent and comparable information. If a substantial part of the
application principles of IAS 1 is maintained, and some principles are transferred to IAS 8 and IFRS 7, the main
impact of the application of IFRS 18 refers to the presentation of the Income Statement.
The main changes introduced by this Standard are:
\u2013 Promotes a more structured income statement, in particular, it introduces a newly defined \u2018operating profit\u2019
subtotal and a requirement for all income and expenses to be classified into three new distinct categories
based on a company\u2019s main business activities, namely: Operating, Investing and Financing.
\u2013 Requirement to companies to analyse their operating expenses directly on the face of the income statement \u2013
either by nature, by function or on a mixed basis.
\u2013 Requirement to some of the \"non-GAAP\" measures the Group uses to be reported in the financial statements.
It defines MPMs as a subtotal of income and expenses that is used in public communications outside the
financial statements; and communicates management\u2019s view of financial performance.
For each MPM presented, companies will need to explain in a single note to the financial statements why the
measure provides useful information and how it is calculated, and to reconcile it to an amount determined
under IFRS Accounting Standards.
\u2013 Introduction of enhanced guidance on how companies group information in the financial statements. This
includes guidance on whether material information is included in the primary financial statements or is further
disaggregated in the notes.
The Group is currently assessing the potential impact resulting from the adoption of this amendment.
3 - Standards, interpretations, amendments and revisions not adopted by the
European Union yet
The following standards, interpretations, amendments and revisions, with mandatory application in future
financial years, have not been endorsed by the European Union until the date of these financial statements, and,
therefore, have not been applied by the Group:
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Translation to a
Hyperinflationary Presentation Currency (applicable for years beginning on or after 1
January 2027)
This amendment was issued on 13 November 2025 regarding Translation to a Hyperinflationary Presentation
Currency. The amendments require entities with a non-hyperinflationary functional currency to translate all
amounts (assets, liabilities, equity, income, expenses, and comparatives) to a hyperinflationary presentation
currency using the closing rate of the most recent reporting period.
The Group is currently assessing the potential impact resulting from the adoption of this amendment.
IFRS 19: Subsidiaries without Public Accountability: Disclosures (applicable for years
beginning on or after 1 January 2027)
This standard was issued on 9 May 2024 and it aims simplify financial reporting for eligible subsidiaries, enabling
them to apply IFRS Accounting Standards with reduced disclosure requirements. Subsidiaries are eligible to apply
IFRS 19 if they do not have public accountability and their parent company applies IFRS Accounting Standards in
preparing their consolidated financial statements. As IFRS Accounting Standards are developed and amended,
IFRS 19 will be amended alongside them-always with a view to reducing disclosure requirements for eligible
subsidiaries.
This standard does not apply to the Group.
Amendments to IFRS 19 Subsidiaries without Public Accountability: Disclosures (applicable
for years beginning on or after 1 January 2027)
This amendment was issued on 21 August 2025 in order to:
- reduced the disclosure requirements by excluding disclosure objectives relating to supplier finance
arrangements, lack of exchangeability, Pillar Two model rules, classification and measurement of financial
instruments, and non-current liabilities with covenants;
- reduced disclosure requirements relating to supplier finance arrangements;
- excluded disclosure requirements that are in fact guidance, not requirements;
- replaced disclosure requirements relating to management-defined performance measures by a cross-reference
to IFRS 18.
This amendment does not apply to the Group.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFirstTimeAdoptionExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } }, "f-735": { "value": "Subsequent events
In addition to the aspects disclosed in the other notes and according to the accounting policy 1 Z, the events that
occurred after the date of the financial statements and until the date of its approval, were as follows:
Military conflict in the Middle East
Following the military conflict between the United States and Iran that began in February 2026, financial markets
reacted with a significant increase in volatility and a rise in the price of energy commodities, namely oil and
natural gas, impacting the behaviour of stock and bond markets. In direct reaction to fears of increased inflation
due to the potential impact on energy prices, there was a reversal in the outlook for monetary policy, with market
prices considering the possibility of interest rate hikes in 2026 in the US and the Eurozone, compared to the
previous outlook of lower rates.
The impact of the conflict will depend on its evolution and extent, especially the potential disruption to production
and supply chains, the shock to the confidence of economic agents, and the consequent economic policy
response.
Storms that affected Portugal
Between January and February 2026, there were a number of storms in Portugal, affecting the physical assets of
individuals and companies, some of which had serious repercussions on activity. Based on the information
available at the time, it is very difficult to estimate the direct and indirect impacts of these storms; however, it is
expected that the effects on the Portuguese economy were mitigated by the definition and implementation of
recovery measures and financial support, such as public moratoria, for the affected areas.
Banco Comercial Portugu\u00eas, S.A. informed about issue of senior preferred debt
securities eligible for MREL
On 29 January 2026, Banco Comercial Portugu\u00eas, S.A. (\u201cBank\u201d) hereby informed that it has fixed the terms for a
new issue of senior preferred debt securities eligible for MREL (Minimum Requirement for own funds and Eligible
Liabilities), under its Euro Note Programme.
The issue, in the amount of EUR 500 million, will have a tenor of 6 years and 3 months, with the option of early
redemption by the Bank on 5 May 2031 (\u201cOptional Redemption Date\u201d), an issue price of 99.990% and an annual
interest rate of 3.250% until the Optional Redemption Date. The interest rate from the Optional Redemption Date
was set at 3-month Euribor plus a 0.72% spread.
The issue was placed among a diversified base of institutional investors, namely in investment funds, banks and
pension funds, enabling the tightening of the spread by more than 25bp during the execution phase.
BCP S.A. informed about decision to call the currently outstanding EUR 500,000,000
Senior Preferred Fixed to Floating Rate Notes due 2027 with an outstanding amount of
500 million euros
On 20 January 2026, Banco Comercial Portugu\u00eas, S.A. informed that it has decided to exercise its option to early
redeem all of its EUR 500,000,000 Senior Preferred Fixed to Floating Rate Notes due 2027 (ISIN: PTBCPHOM0066),
issued on 12 February 2021 under the EUR25,000,000,000 Euro Note Programme (the \u201cNotes\u201d), in accordance with
condition 6(d) of the terms and conditions of the Notes and the final terms of the Notes. The early redemption of
the Notes shall take place on the optional redemption date set out in the final terms of the Notes, 12 February
2026, at their outstanding principal amount together with accrued interest.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEventsAfterReportingPeriodExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2025-01-01T00:00:00/2026-01-01T00:00:00" } } } }