BBVXF Banco Bilbao Vizcaya Argentari (PK)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of February, 2020

Commission file number: 1-10110

BANCO BILBAO VIZCAYA ARGENTARIA, S.A.

(Exact name of Registrant as specified in its charter)

BANK BILBAO VIZCAYA ARGENTARIA, S.A.

(Translation of Registrant’s name into English)

Calle Azul 4,

28050 Madrid

Spain

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F   ☒             Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes  ☐             No  ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes  ☐             No  ☒

Annual Report on the Remuneration of BBVA Directors

REFERENCE FINANCIAL YEAR 2019

APPROVAL DATE OF REPORT 10 FEBRUARY 2020

Table of contents

Executive summary: 2019 Remuneration

Remuneration of executive directors accrued in 2019

The executive directors’ individual indicators have achieved their set objectives.

Pension system contributions in 2019 (in thousands of EUR):

DPB: Discretionary Pension Benefits

Remuneration of non-executive directors (in thousands of EUR):

Fixed annual amounts

In addition, non-executive directors have received remuneration in kind amounting to a total of EUR 104 thousand in 2019.

System of fixed remuneration with deferred delivery of BBVA shares

Shares will be delivered after they cease to be directors, for any grounds other than serious dereliction of duties.

ANNUAL REPORT ON THE REMUNERATION OF DIRECTORS

This document has been drafted in accordance with the provisions of Article 541 of the Spanish Corporate Enterprises Act and Circular 2/2018¹ of the Spanish National Securities Market Committee (“CNMV”), which stipulates that companies may submit their annual report on the remuneration of directors in a free format, instead of using the standardised electronic document created for this purpose, provided that the contents of the aforementioned Circular are included.

Pursuant to the above, the Board of Directors of Banco Bilbao Vizcaya Argentaria, S.A. (hereinafter “BBVA”, the “Entity” or the “Bank”), at its meeting held on 10 February 2020, on the proposal of the Remunerations Committee, has approved this Annual Report on the Remuneration of BBVA Directors (hereinafter the “Remuneration Report” or the “Report”), with the aim of disclosing complete, clear and understandable information on the remuneration policy applicable to members of the BBVA Board of Directors for the current financial year. It also includes information on how the remuneration policy was applied during the 2019 financial year and a detailed description of the individual remunerations accrued by each director throughout such financial year.

This Report, as well as the statistical appendix included in section 2.3, has been disclosed as a material event and will be put to a consultative vote, as a separate item on the agenda at the Bank’s next Annual General Shareholders’ Meeting, to be held on 13 March 2020.

Annex 2 to this report, “Alignment with the Annual Report on the Remuneration of Directors of CNMV for Listed Companies”, indicates where to find, within this document, the information set out in each section of the official format.

This document should be read in conjunction with Note 54 of the Annual Report on BBVA Group’s consolidated Annual Financial Statements for the 2019 financial year, which contains, among others, a breakdown, by director and remuneration item, of the remuneration received by directors in the 2019 financial year. These documents were made available to shareholders on the Bank’s website upon the calling of the aforementioned General Meeting (www.bbva.com).

General principles of the Group Remuneration Policy

BBVA has a remuneration policy that applies generally to all employees of the Bank and the companies within its consolidated group (hereinafter the “BBVA Group” or the “Group”) which focuses on the recurrent generation of value for the Group and seeks to align the interests of its employees and shareholders with prudent risk management.

This policy was designed by the Bank’s Board of Directors as part of BBVA’s Corporate Governance System which aims to ensure proper management of the Group and is based on the following principles:

BBVA has defined the Group Remuneration Policy on the basis of these principles, taking into consideration the need to comply with the legal requirements that are applicable for credit institutions and the different sectors in which it operates, as well as alignment with best market practices. The Policy includes items designed to reduce exposure to excessive risks and adjust remuneration to the Group’s targets, values and long-term interests.

In this regard, the Policy addresses the following requirements:

As part of the Group Remuneration Policy, BBVA has a specific policy applicable to those categories of staff whose professional activities have a significant impact on the Group’s risk profile (hereinafter, the “Identified Staff”), a group including BBVA directors² and Senior Management. This policy is in line with the regulations and recommendations applicable to remuneration schemes for these categories of staff, and, in particular, complies with the provisions of Spanish Act 10/2014, of 26 June, on the regulation, supervision and solvency of credit institutions.

This policy aims to further align BBVA’s remuneration practices with applicable regulations, good governance recommendations and best market practices, thereby allowing BBVA to retain its position as a benchmark for the sector in this area.

The result is an incentive scheme specifically oriented towards reducing exposure to excessive risks and aligning the remuneration of the members of the Identified Staff with the Group’s long-term targets, values and interests, on the basis of, inter alia, the following key features:

The fixed and variable components of the total remuneration will be properly balanced, in accordance with the provisions of the applicable regulation, allowing for a fully flexible policy regarding the payment of variable components, which may lead to these being reduced, as applicable, in their entirety.

In this regard, the Bank has established “target” ratios between fixed remuneration and variable remuneration, taking into account the functions undertaken and their impact on the Group’s risk profile, each being adapted to the current situation of the different countries or functions.

The variable remuneration for members of the Identified Staff will be linked to the level of achievement of pre-established targets, both financial and non-financial, defined at Group, area and individual levels, which take into account the Group’s long-term interests and is based on effective risk management.

Under no circumstances will the variable remuneration limit the Group’s capacity to strengthen its capital base in accordance with regulatory requirements, and it will take into account current and future risks.

The current incentive model establishes, as a previous condition, that variable remuneration will only be paid if BBVA fulfils the capital requirements and a minimum threshold of net attributable profit determined by the Board of Directors.

Similarly, variable remuneration for the Identified Staff for each financial year will be subject to ex-ante adjustments, in such a way that it will be reduced upon performance assessment in the event of a downturn in the Group’s results or other parameters, such as the degree of attainment of budgeted targets.

The annual variable remuneration for the Identified Staff, like that of executive directors, is based on an incentive awarded annually, which reflects their performance measured on the basis of achieved targets, and will be calculated on the basis of:

The annual variable remuneration for the Identified Staff, determined as set out above, shall vest, if conditions are met, subject to the settlement and payment rules listed below, with certain particularities applicable to executive directors and members of Senior Management:

Therefore, BBVA has been gradually implementing a sound and consistent remuneration policy, which is aligned with the Entity’s long-term interests, shareholders’ interests and prudent risk management.

Based on the same principles and outline that guide the Group Remuneration Policy, as described in the previous section, BBVA has a specific remuneration policy for its directors, whose most recent update was approved by the General Shareholders Meeting held on 15 March 2019 for the years 2019, 2020 and 2021 (the “Directors’ Remuneration Policy” or the “Policy”), by 94.83% of favourable votes.

Therefore, during 2019, on the proposal of the Remunerations Committee, the Board of Directors submitted to the General Shareholders’ Meeting an updated Directors’ Remuneration Policy, in order to include the contractual conditions for the Group Executive Chairman and Chief Executive Officer

(Consejero Delegado) as a result from their appointments in December 2018, as well as to add certain technical improvements, while maintaining the established remuneration system.

This Policy is designed in accordance with corporate legislation and specific regulations applicable to financial institutions, and is in line with the Entity’s Bylaws, also taking into account the best practices and recommendations on this matter both at local and international levels.

In accordance with the Bank’s Bylaws, the Policy distinguishes between the remuneration system applicable to non-executive directors and the system applicable to executive directors.

The remuneration system for non-executive directors, in accordance with Article 33 bis of the Bylaws, is based on the criteria of responsibility, dedication and incompatibilities inherent to the role that they undertake and consists of a fixed remuneration which comprises the following items:

The remuneration system for executive directors is defined in accordance with best market practices, which items are set out in Article 50 bis of the Bylaws and correspond to those generally applicable to members of the Bank’s Senior Management.

The remuneration system for executive directors comprises the following items:

The Directors’ Remuneration Policy also establishes “target” ratios between the Annual Fixed Remuneration and the target Annual Variable Remuneration of BBVA’s executive directors, which take into account the functions carried out by each executive director and their impact on the Group’s risk profile, and are aligned with the ratios established, in general terms, for the remaining Identified Staff members.

The “target” ratios for executive directors, for the term of the Policy, are as follows:

Once the amount of the Annual Variable Remuneration of each executive director is determined, it will be subject to the same settlement and payment system applicable to the Identified Staff, with certain particularities applicable to executive directors as described above.

Additionally, upon receipt of the shares, executive directors may not transfer a number of shares equivalent to twice their Annual Fixed Remuneration for at least three years after their delivery.

Settlement and payment system for 2019 Annual Variable Remuneration

Main conditions of the executive directors’ contracts

Each executive director’s remuneration, rights and financial compensation will be determined in accordance with their responsibility, the functions they carry out and the level of achievement of the objectives and are competitive with those of equivalent functions in major comparable institutions. Such conditions are contained in their respective contracts, which are approved by the Board of Directors at the proposal of the Remunerations Committee.

Under the Policy, the main conditions of the executive directors’ contracts are the following:

The Bank has undertaken provision commitments to cover the retirement contingencies of the Group Executive Chairman and the Head of GE&PA. These include the following main features, which are in line with those applicable to the rest of Senior Management:

Regarding the Group Executive Chairman, the Bank has made the following commitments:

Retirement, death and disability contingencies:

As regards the Chief Executive Officer, the Bank has not undertaken any retirement commitments, but has made commitments to cover disability and death contingencies, in the terms detailed below:

Death and disability contingencies:

The Head of GE&PA’s pension framework to cover death and disability contingencies is as follows:

Retirement, death and disability contingencies:

Other commitments entered into with executive directors:

In the case of the Chief Executive Officer, both the Policy and his contract grant him the following additional fixed remuneration, in view of his role as an international senior executive:

For executive directors, the contractual framework also establishes a post-contract non-competition clause lasting for two years from termination of duties as BBVA executive directors, for which the Bank will award remuneration to an amount equivalent to their Annual Fixed Remuneration for each year of the non-compete agreement, paid monthly, provided that the executive directors do not leave their positions due to retirement, disability or serious dereliction of duties.

Decision-making process for the approval of the Policy

Within the framework of BBVA’s Bylaws, the Regulations of the Board provide that the Board is responsible for making decisions regarding directors’ remuneration and, for executive directors, the remuneration for their executive functions and other conditions that their contracts must fulfil, in accordance with the remuneration policy approved by the General Meeting.

Among the elements of the Bank’s Corporate Governance System, BBVA’s Board of Directors has set up several committees to assist it in matters within its remit in order to better perform its functions. Among these, the Remunerations Committee assists the Board on issues regarding remuneration that fall within its remit, in particular those relating to the remuneration of directors, senior managers and remaining members of the Identified Staff, ensuring adherence to the remuneration policies established by the Bank.

This Committee comprises a minimum of three members appointed by the Board. All members must be non-executive directors and the majority must be independent directors, including the Chairman.

Below are the names, positions and statuses of the directors that comprise the Remunerations Committee as of the date of this Report:

Thus, BBVA’s Corporate Governance System is configured so that remuneration proposals, submitted to the Board of Directors for consideration, as the Directors’ Remuneration Policy, generally originate from the Remunerations Committee, which previously analyses, debates and determines them.

As part of the decision-making process for remuneration matters, the Remunerations Committee is assisted by the Risk and Compliance Committee, which, in accordance with its Regulations, participates in the process of establishing the remuneration policy, verifying that it is consistent with sound and effective risk management and it does not provide incentives to undertake risks exceeding the levels tolerated by the Entity.

In order to perform its functions adequately, the Committee is assisted by the Bank’s internal services and also has access to external advice as necessary to form opinions on matters within its remit.

In order to update the Directors’ Remuneration Policy in 2019, in addition to the advice of BBVA’s internal services, the Committee was assisted in 2019 by two leading and independent consultancy firms on the remuneration for directors and senior managers: Willis Towers Watson, for analyses and market comparisons, and J&A Garrigues, S.L.P, for the legal analysis regarding the Policy.

In the determination of the Policy and, in particular, the main contractual conditions contained therein for the Group Executive Chairman and Chief Executive Officer, the Remunerations Committee analysed the remunerations in place for similar positions in comparable financial institutions, which make up BBVA’s peer group for remuneration purposes (included in Annex 1).

Finally, in accordance with the provisions of Article 529 novodecies of the Spanish Corporate Enterprises Act, the Directors’ Remuneration Policy was submitted, as a separate item in the agenda, to the Bank’s General Shareholders’ Meeting held on 15 March 2019, and approved by 94.83% of favourable votes.

This Policy is fully aligned with regulatory requirements and is available on the Entity’s website under “Corporate Governance and Remuneration Policy” at the following link: https://shareholdersandinvestors.bbva.com/wp-content/uploads/2019/02/9.BBVA_Directors_Remuneration_Policy.pdf

All of the above guarantees an appropriate decision-making process regarding remuneration, as reflected in the Remunerations Committee Report accompanying the BBVA Directors’ Remuneration Policy, documents that were made available to shareholders prior to their approval by the General Shareholders’ Meeting.

The remuneration policy applied to BBVA directors during the closed financial year (2019) was approved by the Bank’s Annual General Shareholders’ Meeting held on 15 March 2019. The outline and principal characteristics of this are described in section 1.3 above.

Below is a description of how this Policy was applied in 2019 and the corresponding remuneration of each director; and, in the case of executive directors, the link between their remuneration and the results obtained during the financial year.

The process in place at BBVA to apply the Directors’ Remuneration Policy and determine each director’s individual remuneration is directed and supervised by the Remunerations Committee, and has carried out, in 2019, the following actions, inter alia, submitting the corresponding proposals to the Board of Directors for approval, where appropriate:

The Remunerations Committee analysed the approach for updating the BBVA Directors’ Remuneration Policy approved by General Meeting held in 2017. This update included the new contractual conditions for the Group Executive Chairman and the Chief Executive Officer as a result of their appointments in December 2018, as well as certain additional technical improvements, while the remuneration system established in the previous remuneration policy was maintained in general terms.

In February 2019, the Remunerations Committee submitted to the Board of Directors the proposal to update the BBVA Directors’ Remuneration Policy for the 2019, 2020 and 2021 financial years, along with the specific report on the Policy drawn up by this Committee and the proposal of the maximum number of shares to be delivered to the executive directors in the application of this Policy, all of which was submitted to the General Meeting held on 15 March 2019, which approved the Policy with a favourable vote of 94.83%.

As previously mentioned, in order to perform its functions adequately, the Committee is assisted by the Bank’s internal services as well as external advice it considered necessary in order to form opinions on matters within its remit.

In accordance with the statutory framework and the Directors’ Remuneration Policy, the Committee analysed, during 2019, the remuneration allocated to non-executive directors for their Board membership, their membership to its various committees and for carrying out any other duties or responsibilities within the Board, in light of the changes made to the BBVA Corporate Governance System in 2019.

Therefore, the Committee submitted to the Board the proposals for establishing remuneration for the roles of Lead Director and Deputy Chair of the Board of Directors, and reviewing the remuneration for the roles of member and chair of the various Board committees, as a result of the redistribution of the functions of certain committees implemented during the financial year. This resulted in the amounts set out in section 2.1 below.

With regard to the remuneration matters for executive directors, in accordance with the BBVA Directors’ Remuneration Policy, the Committee has undertaken, among others, the following actions during the 2019 financial year, submitting the relevant proposals to the Board:

All of the above activities carried out by the Committee, together with other matters within its remit, have been included in the report on the activity of the Remunerations Committee for 2019, which is made available to all shareholders on the Bank’s website (www.bbva.com).

In accordance with the provisions of the Bank’s Bylaws, and as mentioned in section 1.3 above, the Directors’ Remuneration Policy distinguishes between the remuneration system applicable to non-executive directors and that applicable to executive directors.

Remuneration system for non-executive directors

As mentioned above, the remuneration system for non-executive directors is based on the criteria of responsibility, dedication and incompatibilities relating to the role that they undertake and consists exclusively of a fixed remuneration that comprises the following items:

Fixed annual amounts approved

These amounts were approved by the Board of Directors on 29 May 2019, at the proposal of the Remunerations Committee, following analysis of relevant market comparisons.

Details of the individual remuneration accrued by each non-executive director in 2019 under this remuneration system:

The remuneration received by each non-executive director during 2019 (in thousands of EUR) was as follows:

These amounts are reflected, for each non-executive director, in section (a). i. “Remuneration accrued in cash”, “Fixed remuneration” and “Remuneration for membership on Board Committees” of the CNMV statistical Appendix, included as section 2.3 of this Report.

During the 2019 financial year, EUR 104 thousand was paid out in casualty and healthcare insurance premiums for non-executive directors.

These amounts are reflected, for each non-executive director, in section “Other Items” of the CNMV statistical Appendix, included as section 2.3 of this Report.

In execution of the remuneration system with deferred delivery of shares approved by the General Shareholders’ Meeting held on 18 March 2006 and extended by the General Shareholders’ Meetings held on 11 March 2011 and 11 March 2016, in the 2019 financial year, by resolution of the Board of Directors, the non-executive directors who are beneficiaries of this system have been allocated the “theoretical

shares” corresponding to 20% of the total cash remuneration received by each of them in the 2018 financial year, broken down as follows:

BBVA has no option plans in favour of its directors. In order to comply with the CNMV official statistical appendix, these “theoretical shares” have been likened to “options”, without prejudice to the fact that they do not constitute such an instrument. These shares will only vest only after they cease to be non-executive directors for any reason other than serious dereliction of duties. These shares are reflected in section “ii. Table showing the roll forward from remuneration systems based on shares” of the CNMV statistical Appendix, included as section 2.3 of this Report.

Year-on-year variation:

As indicated above, the variation in the remuneration of non-executive directors with respect to financial year 2018 is due to changes introduced in the Bank’s Corporate Governance System, resulting from the determination of a fixed remuneration for the positions of Deputy Chair and Lead Director and the reorganisation of the roles and responsibilities of some Board committees.

Non-executive directors have not received variable remuneration or any remuneration for any other item not included in this section.

Remuneration system for executive directors

The remuneration system for executive directors is defined in accordance with best market practices, its main items are set out in Article 50 bis of the Bank’s Bylaws and correspond to those generally applicable to members of BBVA’s Senior Management. This system is included in the BBVA Directors’ Remuneration Policy and consists of the following items:

Details of individual remuneration accrued by executive directors in 2019 under this system:

In accordance with the procedure laid out in the Policy, the Board of Directors, on the proposal of the Remunerations Committee, and on the basis of market analyses and comparisons drawn up by independent consultants, approved the amounts of the Annual Fixed Remuneration for the executive directors, as stated in section 4.2 of the BBVA Directors’ Remuneration Policy.

The executive directors therefore received the following remunerations in 2019:

Annual Fixed Remuneration for executive directors (thousands of EUR)

These Annual Fixed Remuneration amounts are reflected in section “a).i. Remuneration accrued in cash”, “Salary” of the executive directors in the CNMV statistical Appendix, included as section 2.3 of this Report.

Year-on-year variation:

The Annual Fixed Remuneration of the Chairman and Chief Executive Officer received in 2019 cannot be compared to the amount received the previous financial year, since both were appointed by the Board of Directors on 20 December 2018 and therefore their remuneration for 2018 was entirely associated with their former positions and functions. In the case of the Head of GE&PA, there was no year-on-year change of Annual Fixed Remuneration between 2018 and 2019.

Executive directors are beneficiaries of healthcare insurance policies subscribed by the Bank, who covers the corresponding premiums that are allocated to directors as remuneration in kind.

In addition, all executive directors are eligible for the benefits that apply to the Bank’s Senior Management.

The amounts paid in 2019 for these items are as follows:

In kind and other benefits (thousands of EUR)

These amounts are reflected in section “a).i. Remuneration accrued in cash” “Other Items” of the CNMV statistical Appendix, included as section 2.3 of this Report.

As described in section 1.3 above, the Annual Variable Remuneration (“AVR”) for executive directors is based on an incentive awarded annually, which reflects their performance measured on the basis of achieved targets associated with annual performance indicators.

To calculate the Annual Variable Remuneration for 2019, the following annual performance indicators and their weightings were used, as approved at the beginning of the year by the Board of Directors, at the proposal of the Remunerations Committee.

These indicators are associated with scales of achievement, approved by the Board at the proposal of the Remunerations Committee, which take into account budgetary compliance in the case of financial indicators. These scales are based on the “target” Annual Variable Remuneration associated with each indicator, which represents the amount of Annual Variable Remuneration if pre-established targets are met at 100%.

Pay for performance 2019 Annual Variable Remuneration

The Annual Variable Remuneration for each executive director is linked to the BBVA Group’s results and varies accordingly.

During the 2019 financial year, the BBVA Group achieved a profit without extraordinary items of EUR 4.83 billion, an increase of 2.7% compared to the 2018 financial year. This result is due, among other reasons, to the increase in recurring revenue and to the containment of operating costs.

This profit is the figure that has been approved for incentive purposes and does not include the negative impact of EUR 1.318 billion resulting from the accounting of the deterioration in the valuation of the BBVA USA goodwill, as this was exclusively a result of the application of accounting regulations. Therefore, it does not affect tangible net equity, capital and liquidity, the ability to distribute dividends or the amount to pay in dividends by the BBVA Group.

Consequently, the outcome and evolution of the annual performance indicators of 2019 Annual Variable Remuneration has represented an improvement from the previous year in the four financial indicators (Attributable Profit, RORC, Efficiency Ratio and Tangible Book Value), which have reached a higher result than the objective set by the Board for the financial year.

In relation to non-financial indicators, a new key management indicator, Digital Sales, was taken into account in the Annual Variable Remuneration calculations for the first time in 2019, reaching 113.12 points. The Customer Satisfaction Index (IReNe), meanwhile, was slightly below the targets.

The results of the above indicators has set the following levels of achievement:

With regard to the individual indicators of the Chairman and of the Chief Executive Officer, who have been assessed by the Board -since they are under the direct authority of this body-, at the proposal of the Remunerations Committee, indicators reflecting their different responsibilities have been taken into account. Thus, for the Chairman, the level of achievement of indicators relating to Talent and Culture, sustainability and strategic transformation have been considered; while for the Chief Executive Officer, indicators related to competitive dynamics, culture and values, finance and risk and strategic transformation have been considered. For the Head of GE&PA, indicators related to the strategic impact of units integrated into the scope of GE&PA have been taken into account, among others. The degree of achievement of these indicators has been positive overall, having achieved the goals set for the financial year.

individual indicators 2019 AVR: Specific dimensions associated to each position

Likewise, for the assessment of the individual indicators, the Remunerations Committee and the Board of Directors have considered the performance assessment of the Chairman and the Chief Executive Officer carried out by the Board, which has been very positive in both cases.

Following year-end 2019, and having met the minimum thresholds for Attributable Profit and Capital Ratio which were established by the Board, among the ex-ante adjustments included in the Policy for the accrual of Annual Variable Remuneration, and in light of the above results, the Board, at the proposal of the Remunerations Committee, has determined the following amounts for the 2019 Annual Variable Remuneration for each executive director:

2019 Annual Variable Remuneration for executive directors

The Annual Variable Remuneration of the Chairman and Chief Executive Officer for 2019 cannot be compared to the amount from the previous financial year, since both were appointed by the Board of Directors on 20 December 2018 and therefore their remuneration for 2018 was entirely associated with their former positions and functions.

Settlement and payment system for 2019 Annual Variable Remuneration

To determine the share component of both the Upfront Payment and the Deferred Portion, pursuant to the system set out in the Policy and explained in the previous section, the average closing price of BBVA share during the trading sessions between 15 December 2019 and 15 January 2020, both inclusive, is taken as a reference, which was EUR 5.03 per share.

Based on the above, the amounts for the Upfront Payment and for the Deferred Portion of 2019 Annual Variable Remuneration, for each executive director, are:

The amounts for the Upfront Payment of the executive directors’ Annual Variable Remuneration are reflected in section “a). i. Remuneration accrued in cash” “Short-term variable remuneration” of the CNMV statistical Appendix, included in section 2.3 of this Report.

The Deferred Portion of 2019 Annual Variable Remuneration (long term) is subject to the ex post adjustments outlined in the Policy, and therefore the amount finally accrued will depend on the degree of compliance with the following multi-year performance indicators, approved by the Board in 2019, at the proposal of the Remunerations Committee, following an analysis by the Risk and Compliance Committee:

With respect to the TSR indicator, evolution of the total return for the Bank’s shareholders will be compared with the evolution of that same indicator over the three-year period (1 January 2020 to 31 December 2022), for the peer group approved by the Board at the proposal of the Remunerations Committee (Annex 1).

The vesting scale of the TSR indicator shall determine the reduction of deferred amounts associated with this indicator when, after the three-year measurement period, its result determines that BBVA’s position is below the median of the peer group.

Thus, if the objectives set for each of the above indicators are not met in the first three years of the deferment period, the Deferred Portion of 2019 Annual Variable Remuneration may be reduced, even in its entirety. Under no circumstances, however, may the amounts initially deferred (indicated in the table above) be increased.

The 2019 Annual Variable Remuneration will, in all cases, be subject to the remaining conditions of the settlement and payment system provided for in the Policy, and will be paid, provided all relevant conditions are met, in accordance with the following calendar: 60% of the Deferred Portion in 2023; 20% in 2024; and 20% in 2025.

Finally, at the closing of the 2019 financial year, in addition to the Deferred Portion of 2019 Annual Variable Remuneration mentioned above, 60% of the Annual Variable Remuneration corresponding to financial years 2017 and 2018 is deferred and pending payment to the executive directors, and will be delivered in upcoming financial years, provided conditions are met, following the conditions set forth in the remuneration policies applicable to previous financial years.

These amounts were subject to compliance with the following multi-year performance indicators, which were approved by the Board of Directors in 2016 for a three-year performance period (2017-2019):

With respect to the TSR indicator, the evolution of the total return for the Bank’s shareholder was compared with the evolution of the same indicator over the three-year period (1 January 2017 to 31 December 2019) for the same peer group indicated in Annex 1.

The vesting scale for the TSR indicator approved by the Board, at the proposal of the Remunerations Committee, was as follows:

Following 2019 year-end and after the deferral and measurement period of the multi-year performance indicators, the indicators aligned with the main risk management and control metrics have fulfilled the pre-established targets. However, with regards to the TSR indicator, the Bank’s position in comparison with the peer group, according to its vesting scale, has determined a 30% reduction in the amount initially deferred for this indicator.

Based on the results of these multi-year performance indicators, and pursuant to the associated scales of achievement and their respective targets and weightings, a downwards adjustment has been made to the amounts of the Deferred Portion of 2016 Annual Variable Remuneration for executive directors, which has resulted in the following amounts:

Final result of the Deferred Portion of 2016 Annual Variable Remuneration for executive directors

These amounts are reflected in section “a). i. Remuneration accrued in cash” “Long-term variable remuneration” of the CNMV statistical Appendix, included in section 2.3 of this Report, given the accrual period for this remuneration ended on 31 December 2019, pursuant to the instructions contained in the official Model of the CNMV Report.

In accordance with the provisions of the Policy, detailed in section 1.3 above, the Bank has not made any pension commitments with non-executive directors.

In the case of executive directors, the pension commitments made with each director are reflected in their respective contracts, which are approved by the Board of Directors and whose main conditions are set out in section 1.3 above.

Pursuant to this system, during the 2019 financial year, the Bank has made the following contributions in order to cover contingencies that are contractually recognised:

These amounts are reflected in section “a) iii. Long-term saving systems”, “Contribution in the financial year by the company” to “Savings systems with unconsolidated economic rights” in the CNMV statistical Appendix, included in section 2.3 of this Report.

Furthermore, pursuant to the Policy, 15% of this annual pension contribution for the executive directors in 2019 (i.e. EUR 246 thousand for the Group Executive Chairman and EUR 38 thousand for the Head of GE&PA) has been recorded in 2019 as “discretionary pension benefits”. After year-end, these “discretionary pension benefits” were adjusted following the same criteria used to determine the 2019 Annual Variable Remuneration for each executive director, in accordance with the level of achievement of the 2019 Annual Variable Remuneration. The resulting calculations are EUR 261 thousand for the Group Executive Chairman and EUR 40 thousand for the Head of GE&PA, which will be allocated to the fund accumulated in 2020, subject to the same conditions as the Deferred Portion of the 2019 Annual Variable Remuneration, and to the other conditions established for these benefits in the Policy.

In light of his status as an international senior executive, the BBVA Directors’ Remuneration Policy provides for the following fixed supplementary remunerations for the Chief Executive Officer, which were paid over the 2019 financial year:

These amounts are reflected in section “a). iv. Detail of other items” in the CNMV statistical Appendix, included in section 2.3 of this Report.

F. Post-contractual non-compete agreement

The contract framework of executive directors establishes a post-contract non-competition clause lasting for two years from termination of duties as BBVA executive directors, for which the Bank will award remuneration of an amount equivalent to their Annual Fixed Remuneration for each year of the non-compete agreement, paid monthly, provided that the executive directors do not leave their positions due to retirement, disability or serious dereliction of their duties. The executive directors have not accrued or received any payment of this nature during the closed year.

Other information relating to 2019

Payments for termination of the contractual relationship

The Bank has no commitment to pay severance indemnity to directors in the event of the termination of the contractual relationship, nor any kind of payment derived from their early dismissal other than those set out in this Report. The directors have not accrued or received any payment of this nature during the closed financial year.

Loans, advances and guarantees

In 2019, directors have not accrued any remuneration arising from the award of advances, loans and guarantees.

For transparency purposes, at the date of this Report, the Bank’s Chief Executive Officer currently has a loan granted by BBVA Compass during his previous role as President and CEO of BBVA Compass (U.S. Country Manager for the BBVA Group). This loan has employment conditions, and the amount drawn down as of 31 December 2019 was EUR 607 thousand.

There are no other remuneration items other than those described in the preceding paragraphs, nor has any supplementary remuneration been accrued by the directors over the financial year in addition or different to that indicated in this Report.

Application of malus and clawback clauses in 2019

In 2019, variable remuneration has not been reduced or recovered. Notwithstanding the foregoing, the Policy establishes arrangements to reduce or recover up to 100% of the Annual Variable Remuneration of executive directors, through malus and clawback clauses, in the same terms applicable to the rest of the Identified Staff.

Theses clauses are detailed in the Directors’ Remuneration Policy disclosed at the Bank’s website.

Measures taken to reduce the remuneration of the Identified Group as a result of exposure to excessive risks and to adjust it to the long-term objectives, values and interests of the company

Actions taken by the Bank, in relation to the remuneration system, to reduce exposure to excessive risks and adjust remuneration to long-term interests have been detailed in section 1 of this Report, as part of the description of the variable remuneration system applicable to the Identified Group and to the executive directors, including the specific rules for the settlement and payment of the Annual Variable Remuneration.

2.3. CNMV statistical Appendix

Overall summary of how the Remuneration Policy was applied in the closed financial year

B.4 Report on the outcome of the consultative vote at the General Shareholders’ Meeting regarding the annual report on the remuneration for the previous financial year, indicating the number of “no” votes cast where applicable:

C. Details of the individual remunerations received by each director