02

Corporate strategy and environment

Environment [PAGE 20] Economic environment [PAGE 20 ] Business environment: sector, technology and sustainability [PAGE 22 ] Strategy [PAGE 28 ] 2022-2024 Strategic Plan  [PAGE 28] 2025-2027 Strategic Plan  [PAGE 35 ]

Environment

Economic environment

Evolution in global economy and eurozone

Throughout 2024, economic activity

displayed markedly varied

performance across different sectors

and regions.

In 2024, the international economy showed

remarkable resilience, with global GDP growth

estimated to be slightly higher than 3%. The year's

economic activity was bolstered by strong job

markets, a slight rebound in household buying

power, and more relaxed financial conditions, all

while inflation rates decreased. Furthermore,

energy prices held relatively steady despite ongoing

geopolitical tensions and uncertainty.

However, the global economy's resilience masked

regional disparities in performance. In the US,

activity remained strong and GDP grew by 2.8%,

exceeding expectations. China, following a sluggish

beginning to the year, exceeded expectations in the

final quarter, culminating in a GDP growth of 5.0%

for all of 2024. The eurozone's economy did not

experience the anticipated lift-off, with activity

remaining subdued. The GDP growth for the year

stood at 0.7%, with significant underperformance in

Germany and, towards the year's end, in France as

well. Amidst this economic slowdown, inflation

followed a steady decline, bringing the eurozone's

headline inflation to average for 2024 of 2.5%,

compared to 5.4% in 2023.

Central banks initiated the monetary

policy easing in major global economies

in the second half of 2024.

The ongoing disinflation trend moving towards the

targets set by central banks enabled the initiation of

monetary policy easing in major global economies.

The ECB started reducing rates in June, followed by

the Fed in September. Throughout the latter half of

2024, both central banks pursued a strategy of

gradual rate reductions, concluding the year with a

total decrease of 100 basis points from the peak.

This left rates between 4.25% and 4.50% for the Fed,

and the deposit facility rate of the ECB at 3.00%.

Additionally, both the Fed and the ECB continued to

shrink their balance sheets through a passive

approach of not reinvesting in maturing assets,

thereby gradually draining excess liquidity which

remained plentiful in the euro area by year's end.

The possibility of activity stabilising at levels better

aligned with the potential of the American and

European economies, combined with expectations

that inflation will near the targets set by their

respective central banks, indicates that both the Fed

and the ECB will likely persist with rate cuts in 2025,

though at varying paces. Market expectations are

for the U S Fed to adjust rates to the 3.75%-4.00%

range, while in the eurozone, the ECB is expected to

reduce rates to 2.00% by the second half of 2025.

However, the path to economic normalisation in

2025 is fraught with challenges, primarily due to

geopolitical tensions, the threat of increasing

protectionism, and the potential fracturing of

international trade.

As 2024 concluded, uncertainties intensified with

Trump's win in the US, raising questions about the

new administration's policies and their effects on

both economic stability and global politics. The

eurozone, meanwhile, struggled with economic

fragility amidst political uncertainties in its two key

economies. 

A hypothetical broad increase in tariffs could

potentially dampen global economic activity

while simultaneously pushing inflation

upwards.

Spain and Portugal

Spain

2024, better than expected.

Nonetheless, Spain's economy in 2024 surpassed

initial forecasts, even with high interest rates

prevailing through much of the year. The GDP grew

by 3.2%, positioning Spain as a leading growth

performer among the major eurozone economies.

Key to the economy's high dynamism were several

factors. Primarily, the external sector thrived, driven

by strong service exports, including both non-tourist

and, notably, tourist services, which significantly

propelled economic activity. Additionally, there was

a revival in household consumption, fueled by

enhanced purchasing power due to declining

inflation rates. The labour market's vigor, further

amplified by population growth from immigration,

also played a crucial role. In this context, the year

concluded with an increase of over half a million

Social Security contributors, bringing the total above

21.3 million, setting a new record.

Inflation pleasantly surprised in 2024, standing at an

annual average of 2.8% versus 3.5% in the previous

year. Core inflation, excluding energy and

unprocessed foods, experienced an even greater

decline (2.9% annual average versus 6.0% in 2023).

In 2024, the residential market saw a significant

uptick in activity. After experiencing double-digit

declines in 2023, house sales rebounded with a

8.1% annual increase (based on data up to

November, the most recent data available). Over the

last 12 months, approximately 628,000 transactions

were completed, marking almost a 40% increase in

activity compared to the pre-pandemic average

from 2015-2019. Conversely, in 2024, the supply of

new housing saw a substantial recovery with

building permits increasing by 17.1% year-over-year

by November. Despite this growth, the supply

remains inadequate to meet the robust demand.

leading to a significant acceleration in house prices

in 2024 due to the imbalance between high demand

and limited supply. 

For 2025, we anticipate a slight moderation in GDP

growth, despite the positive surprises in late 2024's

figures. External demand is expected to wane as

tourism growth normalises and our key trading

partners continue to show economic fragility.

Domestic demand will strengthen, driven by

household consumption - bolstered by a strong

financial standing and further gains in purchasing

power - and by investment, facilitated by better

financing conditions and the rollout of NGEU funds.

However, public consumption will contribute less,

due to the need to adjust the public deficit with the

reintroduction of fiscal rules.

Portugal

Slight slowdown

of the Portuguese economy.

The Portuguese economy experienced a

deceleration in 2024, with an GDP growth rate of

1.9% versus 2.5% in 2023. Despite this, its growth

rate surpassed the eurozone's average. The

cumulative impact of various global economic

shocks, the effects of inflation, and the significant

hike in interest rates, which hit a peak in mid-2023,

along with uncertainties surrounding the March

parliamentary elections, all played a part in the

economic cooling seen in 2024. However, the

economy exhibited a consistent growth trend

throughout the year, with the annual GDP growth

rate increasing from a quarterly rate of 0.6% in Q1

to 1.5% by Q4. Domestic demand was the primary

growth engine, particularly driven by vibrant private

consumption, supported by a significant rise in

household income amidst sustained employment

growth, and by investment, spurred by the effective

deployment of EU funds.

Looking ahead to 2025, we anticipate the

Portuguese economy will continue its expansionary

path, fuelled by monetary policy easing, inflation

nearing the 2% target, and a supportive fiscal policy.

This outlook is underpinned by recent years' strong

performance, which has resulted in a state budget

surplus and a notable decrease in public debt.

Business environment: sector, technology and sustainability

Business profitability and capital adequacy

The Spanish banking sector’s profitability remains robust in the first half of 2024, bolstered by net interest income

contributions. Consequently, the return on equity (ROE) for the third quarter of 2024 reached 14.1%1, an increase of nearly two

percentage points from the previous year.

In 2024 the trend in net interest income has continued to reflect the tightening

in monetary policy that drove interest rates higher than initially expected in

2023. Nevertheless, the decision of the European Central Bank (ECB) to begin

lowering interest rates in June 2024, which has been reflected in the evolution of

Euribor mainly in the second half of the year, will limit the growth potential of

banks' net interest income in the next year.

In December 2024 the credit portfolio to the private sector in Spain rose

0.62% with respect to December 2023, reversing the downward trend of recent

years. The recent decrease in benchmark interest rates and the revival in credit

demand have helped mitigate this contraction. 

Meanwhile, the credit quality has improved in 2024. The NPL ratio stood at

3.38% in November 2024, representing a cumulative increase of 20 basis points

when compared to the previous year and 17 basis points with respect to

December 2023.

Signs of early impairment of credit quality have been relatively modest. Thus

1 Bank of Spain's Supervisory Statistics.

2 Bank of Spain Financial Stability Report. Autumn 2024.

special-watch-list loans have slowed their growth, with an increase of just 0.5% in

June 2024 compared to the previous year, down from a 3.5% rise in 20232. The

weight of loans on special watch (or Stage 2) stands at 7% in June 20242. In ICO-

guaranteed loans to companies, the proportion of those classified as being on

special watch stood at 23.6%2 in June 2024, which is 3 percentage points higher

than the previous year. It is worth highlighting that one of the key factors in the

increase in this ratio was the considerable reduction in the total amount of these

loans (-30.5% year-on-year).

The capital ratios are also at robust levels and continue to have a comfortable

margin over regulatory requirements. In Spain, the CET1 ratio stood at 13.34%1

in the third quarter of 2024. These capital levels are well above those recorded in

the previous financial crisis and grant give the banking sector in Spain a high

capacity to absorb potential losses.

However, it should be noted that the tax on banking has had a significant

impact on the statement of profit and loss of the Spanish banking sector

and, consequently, on the ability to generate capital organically. It is important to

note that the bank tax has been extended for three years, featuring a

progressive rate structure that disproportionately affects the largest institutions.

Liquidity levels in the Spanish financial sector remain high. The system's

liquidity coverage ratio (LCR) reached 181.4% in September 20241, comfortably

exceeding the regulatory requirement of 100%. The loan‑to‑deposit ratio stands

at a balanced 96.5%1. This measure helps maintain the robustness of the

Spanish financial system, significantly reducing the risk of liquidity and funding

pressures similar to those seen globally in 2023.

1 Bank of Spain's Supervisory Statistics.

Digital transformation 

In recent years, the prevailing digital habits and behaviours

of the population, which especially emerged in the wake of

the Covid-19 pandemic, accelerated the process of

digitising the banking sector. In Spain, the use of digital

banking has seen a notable rise from 55% in 2019 to 71% in

2023, surpassing the European average. 3

For the banking industry, digital transformation is leading to a growing focus

on the customer and greater demands to keep them satisfied (in terms of

convenience, immediacy, customisation and cost). Additionally, customer

satisfaction is gaining importance, especially with new market entrants and

reduced costs for switching banks. Furthermore, the digitisation of the banking

sector has caused new non-traditional competitors to appear, such as Fintech

and Bigtech digital platforms, with business models that leverage new

technologies, raise service quality standards and increase pressure on the

sector's margins.

Thus far, this non-traditional sector is very small compared to the financial

sector as a whole. However, these new entrants have grown quickly, and their

presence can be seen throughout the value chain of the financial sector

(specifically in the payments and consumer credit segments). Going forward, the

ability of Fintech companies to adapt their business models to an environment

with less liquidity be crucial in determining the sector's evolution. There has

been a noticeable decrease in investor interest in this sector recently. For

instance, funding in the global Fintech sector has continued to drop; in the year

leading up to the third quarter, funding fell by 25% compared to the previous

year, reaching levels lower than in 2019) 1 .

Furthermore, access to data and the ability to generate value from data has

become an important source of competitive advantage. In particular, the

use, processing and storage of data results in information that serves to create

products that generate greater value for the customer and are more tailored to

their risk profile. Additionally, there has been an increase in the use and

development of new technologies (such as Cloud, blockchain or generative

Artificial Intelligence) in the sector, although with different maturity levels. In any

case, the use of new technologies in the sector generates the need to adapt

business processes and strategies to the new environment. 

The digitalisation of the sector also brings with it numerous opportunities

to generate more revenue. In particular, through the use of digital technology,

institutions can expand their customer base and provide services more

efficiently and at a lower cost. In that regard, digitalisation makes it possible to

reach a larger number of potential customers, without having to expand the

branch network in the territory.

At the same time, digitalisation also creates new business opportunities, for

example by offering their digital platforms for third parties to market their

products, or through new financial products that are better adapted to the needs

of each customer.

Meanwhile, payment habits are changing. The trend of a reduction in the use

of cash in favour of electronic payments has gained speed with COVID-19,

becoming established thereafter. Digital payment systems are also evolving away

from a model dominated almost exclusively by card systems (linked to bank

deposits) towards a more mixed model in which Fintech and Big Tech also

participate, which offer alternative payment solutions supported by new

technologies, with the emergence of new types of money and payment methods,

such as stablecoins.

In this context, the rapid expansion of the crypto-assets and stablecoins

market in recent years has driven investment in technologies such as

Distributed Ledger Technology (DLT) or cryptography, which allow the

development of new value-added features in payments (such as the ability to

programme payments through Smart Contracts). This trend gains further

momentum due to the implementation of the MICA regulation and the pilot EU

DLT scheme, which enhance regulatory clarity in this domain.

1 Bank of Spain's Supervisory Statistics.

3 Source: Eurostat.

Faced with such developments, central banks, particularly in advanced

economies, are considering issuing their own digital currencies (CBDCs) as a

way to ensure that citizens and businesses continue to have access to central

bank money in the digital age, and that the money they issue continues to act as

a monetary anchor (supporting the stability, integration and efficiency of the

financial and payment systems).

Thus, in the eurozone, the European Central Bank  (ECB)  is exploring the

possibility of issuing a digital euro to supplement cash and as an additional

payment solution. Following a two-year research period (2021-23) dedicated to

crafting a design proposal for the digital euro, conducting technical explorations,

and learning, the ECB is now advancing into the technical development phase,

setting the stage for potential future issuance of a digital euro. Meanwhile, in

June 2023, the European Commission published the legislative proposal

laying down the possible establishment of a digital euro, a proposal that is

being debated in the European Parliament and the European Council.

The European Commission also presented other legislative proposals

geared towards aligning payment services and the financial sector in

general with the digital transformation of the European economy, and which

have a high potential for disruption. Notably, the proposal to update the

European Directive on payment services (PSD3 and PSR) is significant, as it will

alter how access to customer payment data is managed and includes new

measures to combat and reduce fraud. However, these changes need to go

through the legislative process before they can be implemented.

Also prominent is the proposal to review the European Payment Directive on

electronic payments (PSD3 and PSR), which, among other aspects, will

introduce changes in the management of customer payment data permissions

and measures to combat and mitigate fraud. Nevertheless, these proposals still

need to go through the legislative process before being adopted.

CaixaBank faces the challenge of digitalisation with a strategy focused on

customer experience. In this regard, the digital transformation offers the

Institution new opportunities to understand its customers and offer them a

higher-value proposal, using a multi-channel assistance model. In particular,

CaixaBank has a distribution platform that combines immense physical

capillarity with strong digital capabilities—proof of this is that the bank has more

than 12 million digital customers in Spain.

In response to changing habits of customers, special emphasis is also being

placed by the Company on initiatives that allow for improved interaction

with customers through non-face-to-face channels. Meanwhile, digital

transformation is also driving CaixaBank to focus more on the development of

skills, such as advanced analytics, generative AI and the provision of native digital

services. Regarding this last point, imagin features a digital ecosystem and

lifestyle platform focused on the younger segment, offering financial and non-

financial products and services, it own and of third parties. In addition, the Entity

is also promoting new ways of working (more cross-cutting and collaborative)

and is actively seeking to collaborate with new entrants that offer services that

can be incorporated into the Group's value proposition.

Cybersecurity

Digital transformation is vital for the sector's competitiveness

and efficiency, but it also exposes banks to new risks. In this

regard, the increased digital operations of customers and

employees make it necessary to increase the focus on

cybersecurity, digital fraud and information protection.

Operational risk, which encompasses potential losses from inadequate internal

processes, systems, human errors, or external events impacting organisational

operations, is increasingly significant.

Cyber risk poses a serious threat to financial stability and the global

economy. Specifically, cyber incidents can have an impact on a range of financial

activities (such as the provision of credit, payment and settlement services) by

disrupting the information and communication technologies (ICT) that support

them. Cyber incidents can also result in the misuse of the data that these

technologies process or store. Inside the financial sector, banks have many

points of contact with third parties, which increases their exposure to cyber-

attacks and can be used as entry points for attacks in the financial sector.

Furthermore, the cyber threat landscape is in constant evolution and is

becoming increasingly complex, with a higher amount of attacks and further

sophistication and potential impact, as a result of the growing digitalisation of

the economy, increasing dependencies on third parties, geopolitical tensions and

quantic computing.

In response, the European Central Bank has prioritised cyber resilience for

the period 2024-26, intensifying oversight and audits to ensure entities have

robust control environments and can withstand cyber attacks.

In that regard, the European Union (EU) is responding to cyber risk with

several initiatives, including the Digital Operational Resilience Act (DORA), in

force since January 2023 and intended to reinforce the operational resilience of

financial institutions against digital risks, by creating a framework to ensure that

they can prevent, detect and respond to and recover from any kind of disruption

and threat related to ICTs.

CaixaBank is aware of the level of threat and considers cybersecurity to be a

priority. To that end, it has a Strategic Plan for information security that

constantly measures the Group's cybersecurity capabilities and it seeks to keep

the Entity at the forefront of data protection, in accordance with the best market

standards.

CaixaBank has a Strategic Plan for Information Security

that continuously measures the Group's cybersecurity

capabilities.

ä  See section “Cybersecurity”

Sustainability 

The decarbonisation of the European economy is

being accompanied by an increasingly strict

regulation on how to address sustainability and

growing pressure (from investors, authorities, and

supervisors) for companies to adjust their strategies

accordingly.

In that regard, the entry into force of the green

taxonomy is noteworthy among the EU

sustainability regulations. It establishes a

classification system for sustainable activities and

the information requirements on the degree of

alignment with the taxonomy for subject

companies. Similarly, the new Corporate

Sustainability Reporting Directive (CSRD) is also

worth highlighting, which involves a major step

forward in terms of the current ESG reporting

requirements, fostering standardisation and

transparency in sustainability reporting and

equating it to financial reporting. Furthermore, due

to its extension to the value chain, the Directive is

expected to accelerate the sustainable transition of

the business fabric. However, the directive is still

pending transposition in Spain.

In the area of banking oversight, the ECB's action

plan explicitly incorporates climate change and

energy transition into its framework of

operations. The plan seeks to curb climate risk on

the ECB's balance sheet, foster increased

transparency and disclosure of climate risks by

companies and financial institutions, enhance

climate risk management and support the

economy's green transition.

In addition, the setting of supervisory

expectations in this area and the assessment of

the banks' practices related to climate and

environmental risk strategy, governance and

management, stand out.

The European Banking Authority (EBA) also has a

work plan to mainstream ESG aspects into the

regulatory and supervisory framework. Among

the different initiatives is the inclusion of climate

risks in the framework of stress exercises to gauge

the resilience of the European banking sector to

climate risks. In that regard, the EBA, alongside

other European supervisory authorities, the ECB

and the European System Risk Board (ESRB)

conducted a unique one-off exercise to assess the

financial sector's preparedness and resilience to

the package of legislative measures (on energy,

transport, emission reductions, land use and

forestry) "Fit-for-55", to cut the bloc's Greenhouse

Gas (GHG) emissions by 55% by 2030.  The analysis

concluded that the sector is generally resilient to

climate risks, although it emphasised the need for

continuing to improve their management.

In 2021, the EU passed the European Climate

Law, which legally commits to reducing emissions

by 2030 and achieving emission neutrality by 2050.

This has led to the implementation of various

measures and reforms across different economic

sectors (including housing, energy, and transport)

aimed at cutting greenhouse gas emissions in

accordance with these targets and moving towards

a decarbonised economy. This transformation

necessitates profound structural and social changes

and a substantial mobilization of both public and

private resources.

The European Commission has calculated that

an additional annual investment of €477 billion

is required until 2030 to achieve the goals

outlined in the 'Fit-for-55' package in the EU. In

Spain, the PNIEC (National Integrated Energy and

Climate Plan) estimates an additional investment

need of €263 billion between 2023 and 2030, which

means approximately  €33 billion per year. Thanks

to the Next Generation EU (NGEU) Recovery Plan,

around €16.1 billion1 were destined to investments

in renewable energies, sustainable mobility and the

energy rehabilitation of buildings between 2022 and

2024, thus driving the economy's green transition.

In this context, CaixaBank prioritises making

progress in the transition to a low-carbon

economy that fosters sustainable development,

social inclusivity and upholding excellence in

corporate governance. Thus, and to materialise

the commitment, Sustainability (in its

environmental, social and governance scope) is one

of the three pillars of the Group's Strategic Plan.

The actions framed within this strategic axis are

outlined in the Sustainable Banking Plan.

1 Source: IGAE

Strategy

The year 2024 marks the closing of the 2022-2024 Strategic

Plan. This Plan has helped maintain CaixaBank's commitment

to society with a unique banking model and with the aim of

offering the best service for each and every customer profile as

we provide solutions from end to end, promote financial

inclusion and lead the way in generating positive social impacts.

CaixaBank concludes its 2022-2024 Plan with a very positive assessment,

particularly in the financial domain. The macroeconomic environment turned out

to be more favorable due to higher interest rates than initially anticipated

(EUR12M at 2.8% for the period 2022-2024 vs. a forecast of 1.1%). Additionally,

the average GDP growth was slightly above the forecast, while inflation reached

levels much higher than expected. Meanwhile, loans and deposits grew slightly

less than anticipated, but non-investable resources increased more significantly.

The Group finishes this Plan with a positive momentum in business growth and

quality, preparing for significant development in customer service models and

technology for the next plan, while remaining committed to enhancing agility

and improving employee satisfaction and engagement.

In this context, the CaixaBank Group's new Strategic Plan for the period

2025-2027 was unveiled in November 2024.

2022–2024 Strategic Plan

The 2022–2024 Strategic Plan was launched in May 2022 under the slogan "Close

to our customers". This Plan was based on three strategic lines and two cross-

cutting enablers:

The 2022-2024 Strategic Plan was based on the three strategic lines

and two cross-cutting enablers:

Cross-cutting

enablers

Technology

People

Business

growth

Developing

the best value

proposition for

our customers.

Provide an

efficient

customer

service model

Adapted to

the

customers'

preferences

as much as

possible.

Sustainability

A benchmark

in Europe.

CaixaBank Group companies have a Strategic Plan fully aligned with the

CaixaBank Strategic Plan.

1st  Business growth

It focuses on driving business growth, developing the best value proposition

for the customers. CaixaBank has developed a leading financial supermarket in

the Spanish market, featuring a commercial offer built around customer

experiences. The purpose of this line was to continue expanding the capabilities

of this financial supermarket, with the aim of increasing the penetration of our

products and services to customers, progressing the commercial offer and

making a quantitative and qualitative leap in the construction of ecosystems.

This line’s core ambitions included: 

Strengthening leadership in retail banking

through new housing and consumer banking

products and greater penetration in insurance

and long-term savings products.

Achieving leadership

in the corporate,

companies and SMEs

segments.

Driving ecosystems as a new source of income in housing, mobility,

seniors, health, entertainment, business and seniors.

Throughout the execution of the Strategic Plan, the Group has sustained a

positive momentum concerning business expansion and quality. The successful

merger with Bankia has enabled us to enhance our commercial activity, stabilise,

and start expanding our customer base once more, while also improving our

market share performance. With regard to the objectives setin the Plan, the

Group continued to consolidate its leadership in retail banking, with a positive

performance in the main market shares, where the increased share of new

housing production stands out. Furthermore, the positive growth of CIB lending,

supported by a significant growth in the International Banking portfolio also

stands out, which exceeds the objective set for the closing of the Strategic Plan in

2024.

		Starting point			December	Target
		2021	2022	2023	2024	2024
Long-term savings share (%)		29.4%	29.5%	29.3 %	29.5%	~30 %
Non-financial companies portfolio share 1 (%)		23.8%	23.8%	23.5%	23.6 %	~24 %

1 Business in Spain.

2nd Operating with an efficient service model

It sought to maintain an efficient service model, adapting it to suit the

customer's preferences. The aim was to take advantage of the opportunity

arising from the lowering of entry barriers to new technologies that will enable to

explore of new ways of interacting with customers. Thus, this line’s core

ambitions included:

Ensuring a best-in-

class customer

experience.

Achieving greater

operational and

commercial

efficiency.

Improving digital

selling capabilities

Throughout this Strategic Plan, CaixaBank continued to develop the customer

service model in order to make it more efficient and adapted to suit the needs of

each customer. There has been positive development in digital sales capabilities,

with 13.1 million digital customers, half of whom are intensive users of the

Group's digital platforms. Concurrently, we have surpassed the 2024 Plan target

by amassing over 3.5 million customers for the imagin brand.

		Starting point			December	Target
		2021	2022	2023	2024	2024
# imagin Customers (M)1		2.7	3.0	3.3	3.6	3.5

1 It does not include customers shared with CaixaBank.

3rd  Sustainability

The aim was to consolidate CaixaBank as a benchmark in sustainability in

Europe. The prioritisation of the environmental, social and governance areas on

the European agenda gave a unique opportunity to take advantage of the

competitive advantages inherent to the way of banking, highlighting

socialcommitment as a foundational value and the status as European leaders in

microfinance. The main initiatives were as follows:

> Accompanying our customers in their energy

transition

> Commitment to our own transition

> Leading the positive social impact

> Fostering financial inclusion

> Fostering a responsible culture

> Being a leader in governance

Having completed the Strategic Plan, CaixaBank has consolidated itself as a

benchmark in sustainability in Europe. A robust framework has been built –

encompassing processes, systems, and teams – to integrate sustainability into

the Group's comprehensive management strategy. The cumulative mobilisation

of sustainable funds has widely exceeded the target set for 2024, while the rating

average received from ESG rating agencies remains at A, as set in the 2024

target.

		Starting point			December	Target
		2021	2022	2023	2024	2024
Mobilisation of sustainable finance (accumulated 2022-24 in €M) 1		18,531	23,583	50,813	86,770	64,000
Number of active volunteers 2		4,9973	14,000	17,240	20,201	10,000

1 Mobilisation for CaixaBank Group, excluding BPI.

2 Includes Social Month volunteers.

3 The Social Month was not held due to the COVID pandemic.

ä See section "Sustainability strategy"

Cross-cutting enablers

The Plan also included two cross-cutting enablers that supported the execution

of these three strategic priorities: people and technology.

First of all, CaixaBank paid special attention to people and

sought to be the best Group to work for:

Promoting an exciting, committed, collaborative and streamlined team

culture that fosters closer and more motivating leadership.

Boosting its employees' development programmes and career plans,

featuring a more proactive people development model for training teams

and focusing on critical skills.

Fostering new forms of collaborative work, promoting remote working

and helping its employees to develop their potential with equal

opportunities through a meritocracy and diversity-based culture.

In people, the Group continued to strengthen the growth of people as a

cornerstone of their strategy during this period. In this regard, CaixaBank has

risen to 2nd position in the Merco Talent 2023 ranking of the most attractive

companies in the banking sector to work for. It has also concluded the process of

identifying critical skills in order to assess and plan strategic processes and

activities and define upskilling and reskilling actions to improve the value

proposition for employees. Also of note was the rise in the number of women in

management positions, which currently stands at 43.4% in December 2024,

exceeding the target set for 2024.

		Starting point			December	Target
		2021	2022	2023	2024	2024 2
Women in managerial positions (%)1		39.9	41.8	43.0	43.4	43.0

1 Women in management roles at CaixaBank S.A. (ranging from assistant manager of a large branch A to B).

2 In 2023, the goal for women in management positions was revised from 42% to 43% following the update of the Equality Plan.

In terms of technology, the planned advancements in cloud adoption and

cybersecurity enhancements have been achieved. The initiative for process

transformation has advanced, leading to improvements in infrastructure and

end-to-end processes. In addition, several AI use cases have also been deployed. 

The second enabler was geared towards technology. CaixaBank

has outstanding technological capabilities, in which it will

continue to invest to continue to drive the business forward:

Having an efficient, flexible and resilient IT infrastructure, as a result of the

drive for technological transformation from CaixaBank Tech, the adoption

of cloud technology as a cornerstone, the development of data and

advanced analytics capabilities, and ongoing improvement in

cyberdefence to mitigate the growing risk within this scope.

Moving towards end-to-end process

management by identifying and redesigning

key processes and building modular, reusable

parts to the functional architecture.

Streamlining the

allocation of

resources.

		Starting point			December	Target
		2021	2022	2023	2024	2024
Cloud absorption (%)		21%	25%	30 %	33%	32%

Financial objectives

At the end of this Strategic Plan, CaixaBank has

exceeded the financial targets set

for 2024.

The Group set as targets in the presentation of the Strategic Plan to achieve a

ROTE above 12% and a cost-to-income ratio of below 48%. It also committed to

offering attractive shareholder remuneration with a pay-out ratio of over 50%

and set the objective of generating capital of approximately €9,000 million for

distribution purposes (cumulative amount in the 2022-20242 period)1. The

foregoing comes while leveraging on a solid balance sheet position with an NPL

ratio of under 3%, normalisation of the cost of risk below 0.35% (2022–2024

average) and keeping a strong capital position, with a CET1 target without IFRS9

transitional adjustments of between 11–12%.

At the end of the Plan, the core financial principals performed very favourable.

The Group saw a marked increase in profitability, achieving an ROTE of 19.4% by

December 2024, surpassing the initial target of over 12%. Despite an inflationary

shock, costs were kept near the 2021 levels. The cost-to-income ratio hit all-time

lows, as did the non-performing loan ratio. Lastly, the Group maintained

exceptionally strong capital adequacy and liquidity levels, greatly exceeding the

capital distribution goal from the Strategic Plan, reaching €12 billion against a

target of €9 billion.

	Starting point			December	Target3
	2021	2022	2023	2024	2024
ROTE (%) (Cumulative 12 months)	7.6	9.8	15.6	19.4	>12
NPL ratio (%)	3.6	2.7	2.7	2.5	< 3
Recurring cost-to-income ratio (%) 2	57.7	49.8	40.8	37.7	<48

1 Includes the share buyback (SBB) programme for 2022 plus the excess capital generated in 2022-24 above 12% of the CET1 ratio (without IFRS 9 for TA purposes).

2 The Cost-to-income Ratio Target was set under IFRS 4. It is estimated that the impact of the implementation of IFRS17 could be -2 pp. Recurrent cost-to-income ratio (excluding one-off expenses).

3 Objectives defined in the launch of the Strategic Plan. Given the good evolution of the financial metrics, the 2024 targets have been subsequently updated.

2025-2027 Strategic Plan

In November 2024, CaixaBank unveiled its new

Strategic Plan for the period 2025-2027.

During this new Strategic Plan, the Group wants to stay on the course defined in

the 2022-2024 Strategic Plan, but at a faster pace in order to prepare for the

future. CaixaBank is steering towards two primary goals for ensuring long-term

profitability: firstly, to solidify its leading market position, and secondly, to hasten

its transformation for readiness in a more digital and competitive landscape. This

is undertaken with a pledge to remain close to individuals for a sustainable

society, emphasising a distinctive ESG (Environmental, Social, and Governance)

stance.

The 2025-2027 Strategic Plan is centered around three key strategic

lines aimed at maintaining high levels of sustained profitability:

01

Accelerating growth.

02

Business transformation and investment.

03

Differential positioning in ESG .

1st Acceleration of growth

CaixaBank plans to boost business growth in both Spain and Portugal. Following

Client loyalty and engagement, with a particular emphasis on acquiring

new clients.

Promotion of our proprietary digital ecosystems and solutions.

Developing products and services with a focus on sustainability.

Enhancing the value proposition for both individuals and companies.

Sustaining international growth. 

the successful integration with Bankia, the Group aims to solidify its market

leadership by capitalizing on its key strengths to expand across all business

segments through the following strategies:

KPI	2027 Target
Share of credit to households and businesses	Increase share
Share of deposits to households and businesses	Increase share
Share of long-term savings 1	Increase share

1 Total combined share of investment funds, pension plans, and savings insurance under the "Visión Fábrica" initiative.

Based on data from INVERCO and ICEA.

2nd Transformation and investment in the business

CaixaBank intends to spearhead business transformation by ramping up

technology investments to fuel growth in every segment, gearing up for a more

competitive landscape. The Group boasts the largest physical network in Spain,

tailored by segment, with top-tier digital and remote channels, and it aspires to

continue developing unique capabilities for the future. This line’s core ambitions

include:

> Enhance specialised and personalised service through its distinctive

distribution platform.

> Update digital channels to enhance customer experience, increase

commercial capabilities, and optimise operational efficiency.

> Boost investment in technology to bolster strategic initiatives, improve

capabilities, and elevate service quality.

> Foster excellence across the organisation by promoting agility, simplification,

2. Ramping up

investments in

digital and

technology

1. Refining and

enhancing the

distribution

platform

3. Advancing

talent

transformation

Transformation initiatives:

Delivering specialised and

personalised service through our

distinctive distribution platform.

Revamping digital channels to

enhance customer experience and

increase commercial and operational

efficiency.

Boosting technology

investments to back strategic

initiatives, develop state-of-

the-art capabilities, and

elevate service quality.

Promoting organisational excellence

by encouraging agility, simplification,

and fully harnessing the potential of

current talent.

2. Ramping up

investments in

digital and

technology

1. Refining and

enhancing the

distribution

platform

3. Advancing

talent

transformation

Transformation initiatives:

Delivering specialised and

personalised service through our

distinctive distribution platform.

Revamping digital channels to

enhance customer experience and

increase commercial and operational

efficiency.

Boosting technology

investments to back strategic

initiatives, develop state-of-

the-art capabilities, and

elevate service quality.

Promoting organisational excellence

by encouraging agility, simplification,

and fully harnessing the potential of

current talent.

and fully realizing the potential of current talent.

KPI	2027 Target
% Cloud absorption	50%
% Processes supported by AI1	~30 %
% Workforce aged < 35	>11%

1 Percentage of processes transformed using AI solutions relative to the total number of processes redesigned and

implemented.  AI solutions encompass agents, large language models (LLMs), small language models (SLMs), machine learning,

and other forms of artificial intelligence.

3rd Differential positioning in ESG

CaixaBank aims to preserve its founding spirit of being close to people for a

more sustainable society, with two clear goals:

> Advance towards a more sustainable economy, by increasing the

mobilisation of sustainable funds and executing portfolio decarbonisation

objectives in line with the commitments made.

> Enhance economic and social prosperity, focusing on three primary

areas: Social and financial inclusion; Employability and job creation;

and Being a pivotal contributor to the financial and personal well-being of an

aging population.

Levers to achieve these objectives:

> Development of products and services to facilitate the transition for our

clients (e.g. mobility, housing, and business consulting).

> Active Management of Decarbonization Levers (NZBA perimeter) -

Transition Plan.

> Continue to train sales and risk teams.

> Develop a strategy for engaging with corporate clients (Corporate

Banking and CIB).

KPI		2027 Target
Cumulative mobilisation of sustainable funds (€M)		~100,000
People who have improved their employability or gained access to employment thanks to specific solutions (cum. 2025-27)		150,000

Financial objectives

As a consequence of deploying and executing this new

Strategic Plan, CaixaBank seeks to achieve the financial

targets set for 2027.

The new 2025-2027 Strategic Plan is focused on achieving three main

objectives:

1. Maintain sustainable profitability while investing in the business. The

Group has targeted achieving a Return on Tangible Equity (ROTE) exceeding

16% by 2027, maintaining an average over the duration of the Plan above

15%, and an efficiency ratio in the low 40s. Simultaneously, CaixaBank

anticipates a stable net interest income growth around 0%, service income

growth in the mid-single digits, and controlled cost growth at approximately

4%, all calculated in terms of Compound Annual Growth Rate (CAGR)

throughout this Strategic Plan.

2. Growth in profitability with a prudent approach. CaixaBank aims for a

turnover increase of over 4% in CAGR terms, keeping the Non-Performing

Loan (NPL) ratio at around 2% by 2027, and maintaining the Cost of Risk

below 30 basis points on average annually from 2025 to 2027.

3. High distribution capacity. Lastly, the Strategic Plan pledges to distribute

cash dividends with a payout ratio ranging from 50% to 60% of the

consolidated net profit, including an annual interim dividend, and an extra

distribution1 of Common Equity Tier (CET1) capital above 12.5%, while

consistently upholding a robust capital position with a target CET1 ratio

between 11.5% and 12.5%2.

     

KPI		2027 Target
% ROTE		>16%
Cost-to-income ratio		Low 40s
Non-performing loan ratio		~2%

1 Subject to approval by the European Central Bank (ECB) and the Board of Directors. Considers the capital and profitability

objectives established in the 2025-2027 Strategic Plan.

2 The threshold for the additional distribution of CET1 excess capital for 2025 is 12.25%.