FINANCIAL REPORTING AND RESULTS

• Net interest income stands at €4,353 million (+4.8% vs. 2014). This performance was marked by a decrease in the finance cost of retail savings and the contracting of interest income, mainly as a result of the drop in market rates and the reduced volume of institutional activity (fixed income).
• Fee income increased by 10.3%, reaching €2,013 million, mainly as a result of the increase in assets under management in off-balance sheet products.
• Earnings on the investee portfolio amounted to €578 million, up 17.7%.
• Net trading income and exchange differences amounted to €867 million, resulting mainly from latent gains on available-for-sale financial assets.
• “Other operating income and expenses” includes, among other items, higher income from life-risk insurance (+44.2%) and contributions to the Deposit Guarantee Fund and the National Resolution Fund.

• Recurrent costs on a like-for-like basis ¹ were down 1.2%, as a result of our cost containment and streamlining efforts. Factoring in the integration of Barclays Bank, SAU, recurring operating expenses were up 7.7%.
• Furthermore, non-recurring costs of €259 million stemming from the integration of Barclays Bank, SAU and €284 million from the labour agreement² were reported during the year.
• Recurring pre-impairment income increased by 15.7%. If we factor in non-recurring costs, pre-impairment income stood at €3,120 million (−1.5%).
• The recurring cost-to-income ratio improved by 1.8 percentage points, to 52.6%.

Customer funds amounted to €296,599 million (up 9.1% in 2015), following the integration of Barclays Bank, SAU and the strong commercial efforts.

Trends in balance sheet funds were impacted by customers channelling funds from saving products to off-balance sheet products and by the increase in liabilities under insurance contracts (of 6.7% in 2015) following the success of our marketing campaigns.

Assets under management (mutual funds and pension plans) amounted to €74,500 million (up 29.7% on 2014). Net fund subscriptions in 2015 amounted to €7,012 million, 28% of the sector total.

Market leadership for assets under management and the number of mutual funds participants, and pension plan assets under management.

At 31 December 2015, banking liquidity stood at €54,090 million, all of which was immediately available (15.7% of Group assets).

The loan-to-deposits ratio stood at 106.1%, reflecting solid retail financing.

One of the Group‘s top priorities is to ensure that capital is fully optimised

At 31 December 2015, CaixaBank‘s Common Equity Tier 1 (CET1) fully loaded ratio stood at 11.55%, applying the criteria planned for the end of the phase-in period. In 2015, with a 22 basis point change in capital generation and a 78 basis point decrease due to the integration of Barclays Bank, SAU, the fully loaded leverage ratio stands at 5.2%.

Under the progressive application criteria applicable this year, CaixaBank achieved a regulatory CET1 ratio of 12.9% and a leverage ratio of 5.7%.

Risk weighted assets totalled €143,312 million. This was mainly due to the incorporation of the risk weighted assets of Barclays Bank, SAU, offset in part by deleveraging of the loan portfolio.

The ECB‘s publication of its minimum regulatory capital requirements reinforced our capital buffer and capacity to pay dividends. Our solvency resulted in a CET1 buffer of: ~205 fully-loaded basis points and ~360 regulatory basis points.

When the stake swap agreement with CriteriaCaixa3 is made, CaixaBank will meet its Strategic Plan objective of reducing capital consumption by the investee portfolio to less than 10%.

3. Planned swap transferring holdings in Grupo Financiero Inbursa and The Bank of East Asia to CriteriaCaixa in exchange for treasury stock and cash (the regulatory authorisations have yet to be obtained).