CaixaBank

The following is applied to create them: i) the same presentation principles are applied as those used in Group management information, and ii) the same accounting principles and policies as those used to prepare the financial statements.

After the sale of 80% of the real estate business in December 2018, starting from 2019 the non-core real estate business will no longer be reported separately, integrating the remaining assets in the Banking and Insurance business, with the exception of the stake in Coral Homes, SLU (Coral Homes), which is assigned to the Equity Investment business. For comparative purposes, the 2018 and 2017 information is presented aggregating both segments.

As a result, the Group is made up of the following business segments:

1. Banking and insurance

Includes the results of the banking business (retail, corporate and institutional banking, cash management and markets), together with the insurance business and asset management, primarily carried out in Spain through the branch network and the other complementary channels. It covers the activity and results generated by the Group's customers, as well as management of liquidity and the Assets and Liabilities Committee, income from financing the other businesses and the corporate centre. In addition, it includes the businesses acquired by CaixaBank from BPI during 2018 (i.e. insurance, asset management, and cards).

The insurance and banking business is presented in a unified way consistent with the joint business and risk management, since it is a comprehensive business model within a regulatory framework that shares similar monitoring and accounting objectives. The Group markets insurance products, in addition to the other financial products, through its business network with the same client base, because the majority of the insurance products offer savings alternatives (life-savings and pensions) to the banking products (savings and investment funds).

2. Equity investments

Includes income from dividends and/or profit from banks accounted for using the equity method, net of financing costs, from the interests and gains/(losses) on financial assets and liabilities held in Erste Group Bank, Repsol SA (Repsol), Telefónica SA (Telefónica), Banco Fomento de Angola, SA (BFA) and Banco Comercial e de Investimentos, SA (BCI). From 1 January 2019 the 20% stake in Coral Homes is added to this segment, after the sale of the real estate business at the end of December 2018. Similarly, it includes the significant impacts on income of other relevant stakes acquired in various sectors.

It includes the stakes in BFA, which after reassessing the significant influence at year-end 2018 is classified as Financial assets at fair value with changes in other comprehensive income, and in Repsol, until completing its sale in the second quarter of 2019.

3. BPI

Covers the income from the BPI's domestic banking business, essentially in Portugal. The income statement includes the reversion of the adjustments resulting from the application of fair value to the assets and liabilities in the business combination. Furthermore, it excludes the financial statement and equity capital associated with BPI’s assets assigned to the aforementioned equity business (essentially BFA and BCI).

The operating expenses of these business segments include both direct and indirect costs, which are assigned according to internal distribution methods.

In 2019, the allocation of capital to the equity investment business has been adapted to the Group's capital corporate objective of maintaining a fully-loaded Common Equity Tier 1 (CET1) ratio of 12%, taking into account both the 12% consumption of capital for risk-weighted assets (11% in 2018) and any applicable deductions.

The allocation of capital to BPI is at sub-consolidated level, i.e. taking into account the subsidiary's own funds. The capital consumed in BPI by the investees allocated to the investment business is allocated consistently to this business.

The difference between the Group’s total shareholders' equity and the capital assigned to the other businesses is attributed to the banking and insurance business, which includes the Group’s corporate centre.

The performance of the Group by business segment is shown below:

Consolidated statement of profit or loss of the caixabank group - by business segment (Millions of euros)
	Banking and insurance business *						Investments			BPI
	2019		2018		2017
		Of which insurance		Of which insurance		Of which insurance	2019	2018	2017	2019	2018	2017
Net interest icome	4,659	316	4,659	305	4,532	306	(124)	(149)	(168)	416	397	382
Dividend income and share of profit/(loss) of entities accounted for using the equity method **	232	192	220	171	223	156	335	746	416	21	6	14
Net fee and commission income	2,340	(68)	2,303	(124)	2,223	(103)				258	280	276
Gains/(losses) on financial assets and liabilities and others	239	57	219	1	304	64	35	11	(44)	24	48	23
Income and expenses under insurance and reinsurance contracts	556	556	551	551	471	472
Other operating income and expense	(369)	79	(498)	51	(412)	31				(17)	(26)	(18)
Gross income	7,657	1,132	7,454	955	7,341	926	246	608	204	702	705	677
Administrative expenses	(4,803)	(99)	(3.813)	(87)	(3,644)	(73)	(4)	(4)	(4)	(397)	(436)	(502)
Depreciation and amortisation	(479)	(22)	(368)	(21)	(391)	(41)				(67)	(37)	(36)
Pre-impairment income	2,375	1,011	3,273	847	3,306	812	242	604	200	238	232	139
Impairment losses on financial assets and other provisions	(811)		(673)	1	(1,744)				4	200	106	29
Net operating income/(loss)	1,564	1,011	2,600	848	1,562	812	242	604	204	438	338	168
Gains/(losses) on disposal of assets and others	(169)		(179)	1	160			(607)	5	2	51	(1)
Profit/(loss) before tax from continuing operations	1,395	1,011	2,421	849	1,722	812	242	(3)	209	440	389	167
Income tax	(332)	(216)	(695)	(186)	(381)	(178)	71	90	49	(108)	(107)	(46)
Profit/loss) after tax from continuing operations	1,063	795	1,726	663	1,341	634	313	87	258	332	282	121
Profit/(loss) attributable to minority interests	3		57		6			33	13		20	17
Profit/(loss) attributable to the group	1,060	795	1,669	663	1,335	634	313	54	245	332	262	104
Total assets	355,416	76,116	350,783	66,244	347,425	64,016	4,554	4,685	6,894	31,444	31,078	28,817
Of which: positions in sovereign debt	91,549	56,702	87,786	49,247	81,254	47,068				4,637	3,307	3,727

(*) In 2017 this segment includes the impact of the business combination resulting from the acquisition of Banco BPI, as it derived from a corporate operation.

(**) Insurance business includes the contribution of the stake in SegurCaixa Adeslas.

The banking and insurance businesses have an integrated Banking-Insurance management model. Under a regulatory framework with similar accounting and supervision objectives, sales and risks are managed jointly, as the model is integrated. The results of the Banking-Insurance business are presented as a single business segment in the segment reporting because of this integrated Banking-Insurance management model.

The income of the Group by segment, geographical area and distribution of ordinary income is as follows:

Distribution of interest and similar income by geographical area (Millions of euros)
	CaixaBank			CaixaBank Group
	2019	2018	2017	2019	2018	2017
Domestic market	4,104	4,266	4,277	6,540	6,458	6,551
International market	48	23	20	515	488	420
European Union	43	19	16	510	484	403
Eurozone	9	0	0	476	465	387
Non-eurozone	34	19	16	34	19	16
Other countries	5	4	4	5	4	17
Total	4,152	4,289	4,297	7,055	6,946	6,971

Distribution of ordinary income * (Millions of euros)
	Ordinary income from customers			Ordinary income between segments			Total ordinary income
	2019	2018	2017	2019	2018	2017	2019	2018	2017
Banking and insurance	11,345	11,071	10,964	138	160	176	11,483	11,231	11,140
Spain	11,170	10,981	10,941	138	160	176	11,308	11,141	11,117
Other countries	175	90	23				175	90	23
Equity Investments	370	758	372				370	758	372
Spain	106	347	239				106	347	239
Other countries	264	411	133				264	411	133
BPI	757	820	776	64	60	5	821	880	781
Portugal/Spain	749	812	734	64	60	5	813	872	739
Other countries	8	8	42				8	8	42
Ordinary adjustments and eliminations between segments				(202)	(220)	(181)	(202)	(220)	(181)
Total	12,472	12,649	12,112	0	0	0	12,472	12,649	12,112

(*) Corresponding to the following items in the Group's public statement of profit or loss.

1. Interest income.

2. Dividend income.

3. Share of profit/(loss) of entities accounted for using the equity method.

4. Fee and commission income.

5. Gains/(losses) on derecognition of financial assets and liabilities not measured at fair value through profit or loss, net.

6. Gains/(losses) on financial assets and liabilities held for trading, net.

7. Gains/(losses) on assets not designated for trading compulsorily measured at fair value through profit or loss, net.

8. Gains/(losses) on financial assets and liabilities designated at fair value through profit or loss, net.

9. Gains/(losses) from hedge accounting, net.

10. Other operating income.

11. Income from assets under insurance and reinsurance contracts.