Banco Sabadell S.A.

Annual / Quarterly Financial Statement • Feb 10, 2025

Mr MIQUEL ROCA i JUNYENT, Secretary to the Board of Directors of BANCO DE SABADELL, S.A., with registered office in Sabadell, Plaça de Sant Roc núm. 20, and holder of tax identification number (NIF) A08000143.

CERTIFIES:

That at the meeting of the company's Board of Directors held today at Sant Cugat del Vallés, by written notice dated 31 January 2025, attended by the Chairman José Oliu Creus and directors Pedro Fontana García, César González-Bueno Mayer Wittgenstein, Aurora Catá Sala, Ana Colonques García-Planas, Luis Deulofeu Fuguet, María José García Beato, Mireia Giné Torrens, Laura González Molero, George Donald Johnston, David Martínez Guzmán Alicia Reyes Revuelta, Manuel Valls Morató, David Vegara Figueras and Pedro Viñolas Serra, with the undersigned acting as Secretary, the following resolutions were unanimously adopted after due deliberation, among other matters not contradicting it:

"The members of the Board of Directors declare that, to the best of their knowledge, the individual and consolidated annual financial statements for the fiscal year 2024, prepared today and drawn up in accordance with the accounting principles applicable under current legislation, give a true and fair overview of the equity, financial position and results of Banco de Sabadell, S.A. and of the companies included in its scope of consolidation taken as a whole, and that the respective Directors' reports prepared include a true and fair analysis of the performance and results of the business and of the position of Banco de Sabadell, S.A. and of the companies included in its scope of consolidation taken as a whole, together with a description of the main risks and uncertainties they face."

Express mention is hereby made that the minutes of the aforesaid Board meeting in which the above resolutions were read and unanimously approved at the end of the meeting, and that they have been signed by the Secretary with the Chairman's approval.

In witness whereof and for all pertinent purposes, I hereby issue this Certificate with the approval of the Chairman, in Sant Cugat del Vallés, on 6 February 2025.

Approved by

The Chairman The Secretary

Auditor's Report on Banco de Sabadell, S.A. and Subsidiaries

(Together with the consolidated annual financial statements and consolidated directors' report of Banco de Sabadell, S.A. and subsidiaries for the year ended 31 December 2024)

(Translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

KPMG Auditores, S.L. Torre Realia Plaça d'Europa, 41-43 08908 L'Hospitalet de Llobregat (Barcelona)

Independent Auditor's Report on the Consolidated Annual Financial Statements

(Translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

To the shareholders of Banco de Sabadell, S.A.

REPORT ON THE CONSOLIDATED FINANCIAL ANNUAL STATEMENTS

Opinion___________________________________________________________________

We have audited the consolidated annual financial statements of Banco de Sabadell, S.A. (the "Bank") and its subsidiaries (hereinafter the "Group"), which comprise the consolidated balance sheet at 31 December 2024, and the consolidated income statement, consolidated statement of recognised income and expenses, consolidated statement of total changes in equity and consolidated cash flow statement for the year then ended, and consolidated notes.

In our opinion, the accompanying consolidated annual financial statements give a true and fair view, in all material respects, of the consolidated equity and consolidated financial position of the Group at 31 December 2024 and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union (IFRS-EU) and other provisions of the financial reporting framework applicable in Spain.

Basis for Opinion ___________________________________________________________

We conducted our audit in accordance with prevailing legislation regulating the audit of accounts in Spain. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Annual Financial Statements section of our report.

We are independent of the Group in accordance with the ethical requirements, including those regarding independence, that are relevant to our audit of the consolidated annual financial statements pursuant to the legislation regulating the audit of accounts in Spain. We have not provided any non-audit services, nor have any situations or circumstances arisen which, under the aforementioned regulations, have affected the required independence such that this has been compromised.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

KPMG Auditores S.L., a limited liability Spanish company and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Key Audit Matters __________________________________________________________

Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the consolidated annual financial statements of the current period. These matters were addressed in the context of our audit of the consolidated annual financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Impairment of loans and advances to customers

See notes 1.3.4.1, 4.4.2 and 11 to the consolidated annual financial statements

Key audit matter	How the matter was addressed in our audit
The Group's portfolio of loans and advances to customers classified as financial assets at amortised cost reflects a net balance of Euros 158,872 million at 31 December 2024, while allowances and provisions recognised at that date for impairment total Euros 2,844 million. For the purposes of estimating impairment, financial assets measured at amortised cost are classified into three categories (Stage 1, 2 or 3) according to whether a significant increase in credit risk since their initial recognition has been identified (Stage 2), whether the financial assets are credit-impaired (Stage 3) or whether neither of the foregoing circumstances apply (Stage 1). For the Group, establishing this classification is a relevant process inasmuch as the calculation of allowances and provisions for credit risk varies depending on the category in which the financial asset has been included. Impairment is calculated based on models for estimating expected losses, which the Group estimates on both an individual and a collective basis. This calculation entails a considerable level of judgement as this is a significant and complex estimate. Allowances and provisions for credit risk determined individually consider estimates of future business performance and the market value of collateral provided for credit transactions.	Our audit approach in relation to the Group's estimate of impairment of loans and advances to customers due to credit risk mainly consisted of assessing the methodology applied to calculate expected losses, particularly as regards the methods and assumptions used to estimate exposure at default, probability of default and loss given default; and determining the future macroeconomic scenarios. We also reviewed the mathematical accuracy of the calculations of expected losses and the reliability of the data used. To this end, we brought in our credit risk specialists. Our procedures related to the control environment focused on the following key areas: – Credit risk management framework and assessing the compliance of the Group's accounting policies with the applicable regulations. – Classification of the loans and advances to customers portfolio based on credit risk, in accordance with the criteria defined by the Group, particularly the criteria for identifying and classifying refinancing and restructuring transactions. – Relevant controls relating to the monitoring of transactions. – Correct functioning of the internal models for estimating both individual and collective allowances and provisions for credit risk, and for the management and valuation of collateral. – Aspects observed by the internal validation unit in its periodic reviews and in the contrast testing of the models for estimating collective allowances and provisions. – Integrity, accuracy and updating of the data used and of the control and management process in place. – Governance over the estimate of additional adjustments to the expected loss models recorded by the Group and review of the updates by the internal validation unit.

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3

(Translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

Impairment of loans and advances to customers See notes 1.3.4.1, 4.4.2 and 11 to the consolidated annual financial statements
Key audit matter	How the matter was addressed in our audit
In the case of allowances and provisions calculated collectively, expected losses are estimated using internal models that use large databases, different macroeconomic scenarios, parameters to estimate provisions, segmentation criteria and automated processes, which are complex in their design and implementation and require past and present information and future forecasts to be considered. The Group regularly conducts tests of its internal models in order to improve their predictive capabilities based on actual historical experience. Moreover, the Group applies a number of additional adjustments to the results of its credit risk models, known as post model adjustments or overlays, in order to address situations in which the results of these models are not sufficiently sensitive. The consideration of this matter as a key audit matter is based both on the significance of the Group's loans and advances to customers portfolio, and thus of the related allowance and provision for impairment, as well as on the relevance of the process for classifying these financial assets for the purpose of estimating impairment thereon and the complexity and judgement applied to calculating expected losses.	Our tests of detail on the estimated expected losses included the following: – With regard to the appropriate classification of the portfolio of loans and advances to customers based on credit risk, we assessed the accounting classification methodology and criteria used by the Group. We also replicated the accounting classification process applied by the Group, including a review of the appropriate accounting classification for a sample of transactions. – With regard to the impairment of individually significant transactions, we reviewed the methodology and appropriateness of the discounted cash flow models used by the Group. We also selected a sample from the population of significant transactions and assessed the appropriateness of both the credit risk classification and the corresponding allowance and provision recognised. – With respect to the allowances and provisions for impairment estimated collectively, we reviewed the methodology used by the Group, testing the integrity and accuracy of the input data for the process and the correct functioning of the calculation engine by replicating the calculation process, taking into account the segmentation and assumptions used by the Group. – We evaluated the methods and assumptions used to estimate exposure at default, probability of default and loss given default. – We reviewed the macroeconomic scenario variables used by the Group in its internal models to estimate expected losses. – We analysed a sample of guarantees associated with credit transactions, checking their valuation, with the involvement of our real estate valuation specialists. – We reviewed the main additional adjustments to the internal expected loss estimation models recorded by the Group at 31 December 2024, assessing the calculation methodology applied as well as the completeness and accuracy of the data used in estimating these adjustments. Likewise, we analysed whether the disclosures in the notes to the consolidated annual financial statements were prepared in accordance with the criteria set out in the financial reporting framework applicable to the Group.

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(Translation from the original in Spanish. In the event of discrepancy, the Spanish-language version prevails.)

Risks associated with information technology
Key audit matter	How the matter was addressed in our audit
The Group operates in a complex technological environment that is constantly evolving and which must efficiently and reliably meet business requirements. The high level of dependence on these systems with regard to the processing of the Group's financial and accounting information make it necessary to ensure that these systems function correctly. In this context, it is critical to ensure that management of the technological risks that could affect information systems is adequately coordinated and harmonised in relevant areas such as data and program security, systems operation, and development and maintenance of IT applications and systems used to the prepare financial information. We have therefore considered the risks associated with information technology to be a key audit matter.	With the assistance of our specialists in information systems, we carried out tests, at each of the Group entities that are considered relevant for the purpose of the audit, relating to the internal control over the processes and systems involved in generating financial information in the following areas: – Understanding of the information flows and identification of the key controls that ensure the appropriate processing of the financial information. – Testing of the key automated processes that are involved in generating the financial information. – Testing of the controls over the applications and systems related to accessing and processing the information and those related to the security settings of those applications and systems. – Testing of the controls over the operation, maintenance and development of applications and systems.

Other Information: Consolidated Directors' Report _______________________________

Other information solely comprises the 2024 consolidated directors' report, the preparation of which is the responsibility of the Bank's Directors and which does not form an integral part of the consolidated annual financial statements.

Our audit opinion on the consolidated annual financial statements does not encompass the consolidated directors' report. Our responsibility regarding the information contained in the consolidated directors' report is defined in the legislation regulating the audit of accounts, as follows:

• a) Determine, solely, whether the Consolidated Non-Financial Information and Sustainability Statement, certain information included in the Annual Corporate Governance Report and the Annual Report on Directors' Remuneration, as specified in the Spanish Audit Law, have been provided in the manner stipulated in the applicable legislation, and if not, to report on this matter.
• b) Assess and report on the consistency of the rest of the information included in the consolidated directors' report with the consolidated annual financial statements, based on knowledge of the Group obtained during the audit of the aforementioned consolidated annual financial statements. Also, assess and report on whether the content and presentation of this part of the consolidated directors' report are in accordance with applicable legislation. If, based on the work we have performed, we conclude that there are material misstatements, we are required to report them.

Based on the work carried out, as described above, we have observed that the information mentioned in section a) above has been provided in the manner stipulated in the applicable legislation, that the rest of the information contained in the consolidated directors' report is consistent with that disclosed in the consolidated annual financial statements for 2024, and that the content and presentation of the report are in accordance with applicable legislation.

Responsibilities of the Bank's Directors' and the Audit and Control Committee for the Consolidated Annual Financial Statements ______________________________________

The Bank's Directors are responsible for the preparation of the accompanying consolidated annual financial statements in such a way that they give a true and fair view of the consolidated equity, consolidated financial position and consolidated financial performance of the Group in accordance with IFRS-EU and other provisions of the financial reporting framework applicable to the Group in Spain, and for such internal control as they determine is necessary to enable the preparation of consolidated annual financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated annual financial statements, the Bank's Directors are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Bank's Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

The Bank's Audit and Control Committee is responsible for overseeing the preparation and presentation of the consolidated annual financial statements.

Auditor's Responsibilities for the Audit of the Consolidated Annual Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated annual financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with prevailing legislation regulating the audit of accounts in Spain will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated annual financial statements.

As part of an audit in accordance with prevailing legislation regulating the audit of accounts in Spain, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated annual financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Bank's Directors.

• Conclude on the appropriateness of the Bank's Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated annual financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated annual financial statements, including the disclosures, and whether the consolidated annual financial statements represent the underlying transactions and events in a manner that achieves a true and fair view.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated annual financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the Bank's Audit and Control Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the Bank's Audit and Control Committee with a statement that we have complied with the applicable ethical requirements regarding independence, and to communicate with them all matters that may reasonably be thought to bear on our independence, and where applicable, safeguarding measures adopted to eliminate or reduce the threat.

From the matters communicated to the Bank's Audit and Control Committee, we determine those that were of most significance in the audit of the consolidated annual financial statements of the current period and which are therefore the key audit matters.

We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

European Single Electronic Format_____________________________________________

We have examined the digital files of Banco de Sabadell, S.A. and its subsidiaries for 2024 in European Single Electronic Format (ESEF), which comprise the XHTML file that includes the consolidated annual financial statements for the aforementioned year and the XBRL files tagged by the Bank, which will form part of the annual financial report.

The Directors of Banco de Sabadell, S.A. are responsible for the presentation of the 2024 annual report in accordance with the format and mark-up requirements stipulated in Commission Delegated Regulation (EU) 2019/815 of 17 December 2018 (hereinafter the "ESEF Regulation"). In this regard, they have incorporated the Annual Corporate Governance Report and the Annual Report on Directors' Remuneration by means of a reference thereto in the consolidated directors' report.

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Our responsibility consists of examining the digital files prepared by the Directors of the Bank, in accordance with prevailing legislation regulating the audit of accounts in Spain. This legislation requires that we plan and perform our audit procedures to determine whether the content of the consolidated annual financial statements included in the aforementioned digital files fully corresponds to the consolidated annual financial statements we have audited, and whether the consolidated annual financial statements and the aforementioned files have been formatted and marked up, in all material respects, in accordance with the requirements of the ESEF Regulation.

In our opinion, the digital files examined fully correspond to the audited consolidated annual financial statements, and these are presented and marked up, in all material respects, in accordance with the requirements of the ESEF Regulation.

Additional Report to the Bank's Audit and Control Committee ______________________

The opinion expressed in this report is consistent with our additional report to the Bank's Audit and Control Committee dated 10 February 2025.

Contract Period ____________________________________________________________

We were appointed as auditor by the shareholders at the ordinary general meeting held on 10 April 2024 for a period of one year, from the year commenced 1 January 2024.

Previously, we had been appointed for a period of three years, by consensus of the shareholders at their ordinary general meeting, and have been auditing the annual financial statements since the year ended 31 December 2020.

KPMG Auditores, S.L. On the Spanish Official Register of Auditors ("ROAC") with No. S0702

(Signed on original in Spanish)

Francisco Gibert Pibernat On the Spanish Official Register of Auditors ("ROAC") with No. 15,586

10 February 2025

BANCO DE SABADELL, S.A. AND COMPANIES FORMING BANCO SABADELL GROUP

Consolidated annual financial statements and consolidated Directors' Report for the year ended 31 December 2024

Translation of the Consolidated Annual Financial Statements originally issued in Spanish and prepared in accordance with EU-IFRS, as adopted by the European Union. In the event of any discrepancy, the Spanish-language version will prevail.

Contents: Banco Sabadell Group consolidated annual financial statements and consolidated Directors' Report for the year ended 31 December 2024

Consolidated annual financial statement	5
Consolidated financial statements	6
Consolidated balance sheets of Banco Sabadell Group	6
Consolidated income statements of Banco Sabadell Group	9
Consolidated statements of recognised income and expenses of Banco Sabadell Group	11
Consolidated statements of total changes in equity of Banco Sabadell Group	12
Consolidated cash flow statements of Banco Sabadell Group	14
Consolidated annual report	16
Note 1 – Activity, accounting policies and practices, and other information	16
1.1 Activity	16
1.2 Basis of presentation and changes in accounting regulations	16
1.3 Accounting principles and policies and measurement criteria	20
1.3.1 Consolidation principles	20
1.3.2 Business combinations	22
1.3.3 Classification and measurement of financial instruments and recognition of changes arising in their subsequent measurement	23
1.3.4 Impairment of financial assets
	28
1.3.5 Hedging transactions	38
1.3.6 Financial guarantees	39
1.3.7 Transfers and derecognition of financial instruments from the balance sheet	39
1.3.8 Offsetting of financial instruments	40
1.3.9 Non-current assets and assets and liabilities included in disposal groups classified as held for sale and discontinued operations	40
1.3.10 Tangible assets	41
1.3.11 Leases	41
1.3.12 Intangible assets	43
1.3.13 Inventories	44
1.3.14 Own equity instruments	45
1.3.15 Remuneration in equity instruments	45
1.3.16 Provisions, contingent assets and contingent liabilities.	45
1.3.17 Provisions for pensions	46
1.3.18 Foreign currency transactions and exchange differences	47
1.3.19 Recognition of income and expenses	48
1.3.20 Income taxes	49
1.3.21 Consolidated statement of recognised income and expenses	50
1.3.22 Consolidated statement of total changes in equity	50
1.3.23 Consolidated cash flow statement	51
1.4 Comparability	51
1.5 Other information (takeover bid)	51
Note 2 – Banco Sabadell Group	52
Note 3 – Shareholder remuneration and earnings per share	54
Note 4 – Risk management	56
4.1 Macroeconomic, political and regulatory environment	56
4.2 Key milestones during the year	59
4.2.1 The Group's risk profile during the year	59
4.2.2 Strengthened credit risk management and control environment	59
4.3 General principles of risk management	61
4.3.1 Global Risk Framework Policy	61
4.3.2 Risk Appetite Framework (RAF)	62

4.3.3 Risk Appetite Statement (RAS)	63
4.3.4 Specific policies for the various material risks	63
4.3.5 Risk Governance	63
4.4 Management and monitoring of the main material risks	65
4.4.1. Strategic risk	65
4.4.2. Credit risk	67
4.4.3. Financial risks	93
4.4.4. Operational risk	113
Note 5 – Minimum own funds and capital management	117
Note 6 – Fair value of assets and liabilities	126
Note 7 – Cash, cash balances at central banks and other demand deposits	136
Note 8 – Debt securities	137
Note 9 – Equity instruments	138
Note 10 – Derivatives held for trading	139
Note 11 – Loans and advances	140
Note 12 – Derivatives - hedge accounting	148
Note 13 – Non-current assets and disposal groups classified as held for sale	153
Note 14 – Investments in joint ventures and associates	155
Note 15 – Tangible assets	156
Note 16 – Intangible assets	159
Note 17 – Other assets and liabilities	161
Note 18 – Deposits of central banks and credit institutions	162
Note 19 – Customer deposits	163
Note 20 – Debt securities in issue	163
Note 21 – Other financial liabilities	164
Note 22 – Provisions and contingent liabilities	165
Note 23 – Shareholders' equity	171
Note 24 – Accumulated other comprehensive income
Note 25 – Minority interests (non-controlling interests)	174
Note 26 – Off-balance sheet exposures	176
	177
Note 27 – Off-balance sheet customer funds and financial instruments deposited by third parties	178
Note 28 – Interest income and expenses	179
Note 29 – Fee and commission income and expenses	180
Note 30 – Net profit or net loss on financial operations and net exchange differences	180
Note 31 – Other operating income	181
Note 32 – Other operating expenses	181
Note 33 – Administrative expenses	182
Note 34 – Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains	186
Note 35 – Impairment or (-) reversal of impairment on non-financial assets	187
Note 36 – Gains or (-) losses on derecognition of non-financial assets, net	187
Note 37 – Profit or (-) loss from non-current assets and disposal groups classified as held for sale not
qualifying as discontinued operations	187
Note 38 – Segment reporting	188
Note 39 – Tax situation (income tax relating to continuing operations)	192
Note 40 – Related party transactions	197
Note 41 – Remuneration of members of the Board of Directors and Senior Management and their
respective balances	199
Note 42 – Other information	203
Note 43 – Subsequent events	205
Schedule I – Banco Sabadell Group companies	206

Schedule II – Structured entities - Securitisation funds	214
Schedule III – Details of outstanding issues and subordinated liabilities of the Group	215
Schedule IV – Other risk information	219
Schedule V – Annual banking report	231
Consolidated Directors' Report	232
1. Banco Sabadell Group	233
1.1 Mission, values and business model	236
1.2 Strategic priorities	238
1.3 Banco Sabadell share performance and shareholders	241
1.4 Corporate governance	246
1.5 Customers	257
1.6 Other information (tender offer)	270
2. Economic, sectoral and regulatory environment	273
2.1 Economic and financial environment	274
2.2 Financial sector environment	284
2.3 Vision for 2025	288
3. Financial information	290
3.1. Key figures in 2024	291
3.2. Profit/(loss) for the year	292
3.3. Balance sheet	297
3.4. Liquidity management	302
3.5. Capital management	305
4. Business	308
4.1 Banking Business Spain	309
4.2 Banking Business United Kingdom	341
4.3 Banking Business Mexico	344
5. Risks	348
5.1 Strategic risk management and control processes	349
5.2 Main milestones achieved in 2024 in relation to risk management and control	350
6. Other material disclosures	354
6.1 R&D and innovation	355
6.2 Acquisition and sale of treasury shares	356
6.3 Days payable outstanding	356
6.4 Material post-closing events	356
6.5 Other reports related to the Directors' Report	357
Glossary of terms on alternative performance measures	358
Consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, S.A.

Consolidated annual financial statements for the year ended 31 December 2024

Consolidated balance sheets of Banco Sabadell Group

As at 31 December 2024 and 2023

Thousand euro
Assets	Note	2024	2023 (*)
Cash, cash balances at central banks and other demand deposits (**)	7	18,382,112	29,985,853
Financial assets held for trading		3,438,955	2,706,489
Derivatives	10	2,017,999	2,563,994
Equity instruments	9	541,005	—
Debt securities	8	879,951	142,495
Loans and advances		—	—
Central banks		—	—
Credit institutions		—	—
Customers		—	—
Memorandum item: loaned or pledged as security with sale or pledging rights		177,365	1,915
Non-trading financial assets mandatorily at fair value through profit or loss		168,267	153,178
Equity instruments	9	67,049	52,336
Debt securities	8	60,705	65,744
Loans and advances	11	40,513	35,098
Central banks		—	—
Credit institutions		—	—
Customers		40,513	35,098
Memorandum item: loaned or pledged as security with sale or pledging rights		—	—
Financial assets designated at fair value through profit or loss		—	—
Debt securities		—	—
Loans and advances		—	—
Central banks		—	—
Credit institutions		—	—
Customers		—	—
Memorandum item: loaned or pledged as security with sale or pledging rights		—	—
Financial assets at fair value through other comprehensive income		6,369,913	6,269,297
Equity instruments	9	193,580	183,938
Debt securities	8	6,176,333	6,085,359
Loans and advances		—	—
Central banks		—	—
Credit institutions		—	—
Customers		—	—
Memorandum item: loaned or pledged as security with sale or pledging rights		599,794	557,303
Financial assets at amortised cost		196,520,273	180,913,793
Debt securities	8	24,876,126	21,500,927
Loans and advances	11	171,644,147	159,412,866
Central banks		—	156,516
Credit institutions		12,771,685	6,995,951
Customers		158,872,462	152,260,399
Memorandum item: loaned or pledged as security with sale or pledging rights		6,170,535	5,996,602
Derivatives – Hedge accounting	12	2,394,902	2,424,598
Fair value changes of the hedged items in portfolio hedge of interest rate risk	12	(412,346)	(567,608)
Investments in joint ventures and associates	14	524,562	462,756
Joint ventures		—	—
Associates		524,562	462,756
Assets under insurance or reinsurance contracts		—	—
Tangible assets	15	2,077,628	2,296,704
Property, plant and equipment		1,920,487	2,067,106
For own use		1,916,870	2,058,058
Leased out under operating leases		3,617	9,048
Investment properties		157,141	229,598
Of which: leased out under operating leases		157,141	229,598
Memorandum item: acquired through leases		818,544	872,305
Intangible assets	16	2,549,458	2,483,074
Goodwill		1,018,311	1,018,311
Other intangible assets		1,531,147	1,464,763
Tax assets		6,441,141	6,837,820
Current tax assets		541,196	452,289
Deferred tax assets	39	5,899,945	6,385,531
Other assets	17	424,730	436,123
Insurance contracts linked to pensions		80,888	80,693
Inventories		43,776	62,344
Rest of other assets		300,066	293,086
Non-current assets and disposal groups classified as held for sale	13	718,332	770,878
TOTAL ASSETS		239,597,927	235,172,955

(*) Shown for comparative purposes only.

(**) See details in the consolidated cash flow statement of the Group.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated balance sheet as at 31 December 2024.

Consolidated balance sheets of Banco Sabadell Group

As at 31 December 2024 and 2023

Thousand euro
Liabilities	Note	2024	2023 (*)
Financial liabilities held for trading		2,381,434	2,867,459
Derivatives	10	2,298,763	2,530,086
Short positions		82,671	337,373
Deposits		—	—
Central banks		—	—
Credit institutions		—	—
Customers		—	—
Debt securities issued		—	—
Other financial liabilities		—	—
Financial liabilities designated at fair value through profit or loss		—	—
Deposits		—	—
Central banks		—	—
Credit institutions		—	—
Customers		—	—
Debt securities issued		—	—
Other financial liabilities		—	—
Memorandum item: subordinated liabilities		—	—
Financial liabilities at amortised cost		220,228,249	216,071,766
Deposits		186,341,181	183,947,196
Central banks	18	1,696,734	9,776,360
Credit institutions	18	14,821,800	13,840,183
Customers	19	169,822,647	160,330,653
Debt securities issued	20	27,436,938	25,791,284
Other financial liabilities	21	6,450,130	6,333,286
Memorandum item: subordinated liabilities		4,106,638	3,607,858
Derivatives – Hedge accounting	12	803,999	1,171,957
Fair value changes of the hedged items in portfolio hedge of interest rate risk	12	(227,209)	(422,347)
Liabilities under insurance or reinsurance contracts		—	—
Provisions	22	478,254	536,092
Pensions and other post employment defined benefit obligations		54,467	58,308
Other long term employee benefits		40	69
Pending legal issues and tax litigation		75,064	60,550
Commitments and guarantees given		142,482	165,376
Other provisions		206,201	251,789
Tax liabilities		218,886	332,951
Current tax liabilities		98,150	217,981
Deferred tax liabilities	39	120,736	114,970
Share capital repayable on demand		—	—
Other liabilities	17	651,666	722,524
Liabilities included in disposal groups classified as held for sale	13	30,093	13,347
TOTAL LIABILITIES		224,565,372	221,293,749

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated balance sheet as at 31 December 2024.

Consolidated balance sheets of Banco Sabadell Group

As at 31 December 2024 and 2023

Thousand euro
Equity	Note	2024	2023 (*)
Shareholders' equity	23	15,389,242	14,343,946
Capital		680,028	680,028
Paid up capital		680,028	680,028
Unpaid capital called up		—	—
Memorandum item: capital not called up		—	—
Share premium		7,695,227	7,695,227
Equity instruments issued other than capital		—	—
Equity component of compound financial instruments		—	—
Other equity instruments issued		—	—
Other equity		25,407	21,268
Retained earnings		7,373,498	6,401,782
Revaluation reserves		—	—
Other reserves		(1,663,460)	(1,584,816)
Reserves or accumulated losses of investments in joint ventures and associates		79,016	54,836
Other		(1,742,476)	(1,639,652)
(-) Treasury shares		(119,352)	(39,621)
Profit or loss attributable to owners of the parent		1,826,805	1,332,181
(-) Interim dividends		(428,911)	(162,103)
Accumulated other comprehensive income	24	(391,103)	(498,953)
Items that will not be reclassified to profit or loss		(22,460)	(30,596)
Actuarial gains or (-) losses on defined benefit pension plans		(1,826)	(3,313)
Non-current assets and disposal groups classified as held for sale		—	—
Share of other recognised income and expense of investments in joint ventures and associates		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income		(20,634)	(27,283)
Hedge ineffectiveness of fair value hedges for equity instruments measured at fair value through other comprehensive income		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedged item]		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedging instrument]		—	—
Fair value changes of financial liabilities at fair value through profit or loss attributable to changes in their credit risk		—	—
Items that may be reclassified to profit or loss		(368,643)	(468,357)
Hedge of net investments in foreign operations [effective portion]		91,740	77,997
Foreign currency translation		(299,293)	(384,086)
Hedging derivatives. Cash flow hedges reserve [effective portion]		(48,300)	(49,215)
Fair value changes of debt instruments measured at fair value through other		(151,279)	(145,732)
comprehensive income
Hedging instruments [not designated elements]		—	—
Non-current assets and disposal groups classified as held for sale		—	—
Share of other recognised income and expense of investments in joint ventures and associates		38,489	32,679
Minority interests [Non-controlling interests]	25	34,416	34,213
Accumulated other comprehensive income		—	—
Other items		34,416	34,213
TOTAL EQUITY		15,032,555	13,879,206
TOTAL EQUITY AND TOTAL LIABILITIES		239,597,927	235,172,955
Memorandum item: off-balance sheet exposures
Loan commitments given	26	28,775,335	27,035,812
Financial guarantees given	26	1,979,622	2,064,396
Other commitments given	26	9,366,339	7,942,724

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated balance sheet as at 31 December 2024.

Consolidated income statements of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro
	Note	2024	2023 (*)
Interest income	28	9,713,392	8,658,756
Financial assets at fair value through other comprehensive income		204,968	134,309
Financial assets at amortised cost		8,668,531	7,771,231
Other interest income		839,893	753,216
(Interest expenses)	28	(4,692,057)	(3,935,538)
(Expenses on share capital repayable on demand)		—	—
Net interest income	28	5,021,335	4,723,218
Dividend income		6,387	8,413
Profit or loss of entities accounted for using the equity method	14	159,634	122,807
Fee and commission income	29	1,708,162	1,671,213
(Fee and commission expenses)	29	(351,662)	(285,055)
Net profit or net loss on financial operations	30	(240,802)	169,473
Gains or (-) losses on derecognition of financial assets and liabilities not measured at fair value		10,546	23,250
through profit or loss, net
Financial assets at amortised cost		4,769	15,939
Other financial assets and liabilities		5,777	7,311
Gains or (-) losses on financial assets and liabilities held for trading, net		(231,498)	122,249
Reclassification of financial assets from fair value through other comprehensive income		—	—
Reclassification of financial assets from amortised cost		—	—
Other gains or (-) losses		(231,498)	122,249
Gains or (-) losses on non-trading financial assets mandatorily at fair value through profit or loss, net		13,994	11,781
Reclassification of financial assets from fair value through other comprehensive income		—	—
Reclassification of financial assets from amortised cost		—	—
Other gains or (-) losses		13,994	11,781
Gains or (-) losses on financial assets and liabilities designated at fair value through profit or loss,		—	—
net
Gains or (-) losses from hedge accounting, net		(33,844)	12,193
Exchange differences [gain or (-) loss], net	30	327,904	(101,093)
Other operating income	31	111,626	91,184
(Other operating expenses)	32	(405,222)	(538,228)
Income from assets under insurance or reinsurance contracts		—	—
(Expenses on liabilities under insurance or reinsurance contracts)		—	—
Gross income		6,337,362	5,861,932

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated income statement for 2024.

Consolidated income statements of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro
	Note	2024	2023 (*)
(Administrative expenses)		(2,582,749)	(2,496,362)
(Staff expenses)	33	(1,531,352)	(1,494,644)
(Other administrative expenses)	33	(1,051,397)	(1,001,718)
(Depreciation and amortisation)	15, 16	(501,039)	(518,965)
(Provisions or (-) reversal of provisions)	22	(43,762)	(6,290)
(Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains)	34	(591,818)	(824,393)
(Financial assets at fair value through other comprehensive income)		236	852
(Financial assets at amortised cost)		(592,054)	(825,245)
Profit/(loss) on operating activities		2,617,994	2,015,922
(Impairment or (-) reversal of impairment of investments in joint ventures and associates)		—	—
(Impairment or (-) reversal of impairment on non-financial assets)	35	(45,457)	(25,845)
(Tangible assets)		(37,818)	(11,526)
(Intangible assets)		—	—
(Other)		(7,639)	(14,319)
Gains or (-) losses on derecognition of non-financial assets, net	36	(22,253)	(39,344)
Negative goodwill recognised in profit or loss		—	—
Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations	37	(36,386)	(59,955)
Profit or (-) loss before tax from continuing operations		2,513,898	1,890,778
(Tax expense or (-) income related to profit or loss from continuing operations)	39	(685,272)	(557,175)
Profit or (-) loss after tax from continuing operations		1,828,626	1,333,603
Profit or (-) loss after tax from discontinued operations		—	—
PROFIT OR (-) LOSS FOR THE YEAR		1,828,626	1,333,603
Attributable to minority interest [non-controlling interests]	25	1,821	1,422
Attributable to owners of the parent		1,826,805	1,332,181
Earnings (or loss) per share (euros)	3	0.32	0.23
Basic (euros)		0.32	0.23
Diluted (euros)		0.32	0.23

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated income statement for 2024.

Consolidated statements of recognised income and expenses of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro	Note	2024	2023 (*)
Profit or loss for the year		1,828,626	1,333,603
Other comprehensive income	24	107,850	84,447
Items that will not be reclassified to profit or loss		8,136	(1,471)
Actuarial gains or (-) losses on defined benefit pension plans		2,124	(1,919)
Non-current assets and disposal groups held for sale		—	—
Share of other recognised income and expense of investments in joint ventures and associates		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income		9,709	1,250
Gains or (-) losses from hedge accounting of equity instruments at fair value through other comprehensive income, net		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedged item]		—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedging instrument]		—	—
Fair value changes of financial liabilities at fair value through profit or loss attributable to changes in their credit risk		—	—
Income tax relating to items that will not be reclassified		(3,697)	(802)
Items that may be reclassified to profit or loss		99,714	85,918
Hedge of net investments in foreign operations [effective portion]		13,743	(41,351)
Valuation gains or (-) losses taken to equity		13,743	(41,351)
Transferred to profit or loss		—	—
Other reclassifications		—	—
Foreign currency translation		84,794	91,944
Translation gains or (-) losses taken to equity		84,794	91,944
Transferred to profit or loss		—	—
Other reclassifications		—	—
Cash flow hedges [effective portion]		856	22,291
Valuation gains or (-) losses taken to equity		9,708	(74,571)
Transferred to profit or loss		(8,852)	95,129
Transferred to initial carrying amount of hedged items		—	1,733
Other reclassifications		—	—
Hedging instruments [not designated elements]		—	—
Valuation gains or (-) losses taken to equity		—	—
Transferred to profit or loss		—	—
Other reclassifications		—	—
Debt instruments at fair value through other comprehensive income		(6,174)	48,733
Valuation gains or (-) losses taken to equity		489	53,041
Transferred to profit or loss		(6,663)	(4,308)
Other reclassifications		—	—
Non-current assets and disposal groups held for sale		—	—
Valuation gains or (-) losses taken to equity		—	—
Transferred to profit or loss		—	—
Other reclassifications		—	—
Share of other recognised income and expense of investments in joint ventures and associates		5,810	(14,151)
Income tax relating to items that may be reclassified to profit or (-) loss		685	(21,548)
Total comprehensive income for the year		1,936,476	1,418,050
Attributable to minority interest [non-controlling interests]		1,821	1,422
Attributable to owners of the parent		1,934,655	1,416,628

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated statement of recognised income and expenses for 2024.

Consolidated statements of total changes in equity of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro

		Share	Equity instruments issued other		Retained	Revaluation	Other	(-) Treasury	Profit or loss attributable to owners of	(-) Interim	Accumulated other comprehensi	Minority interests: Accumulate d other comprehens	Minority interests:
Sources of equity changes	Capital	premium	than capital	Other equity	earnings	reserves	reserves	shares	the parent	dividends	ve income	ive income	Other items	Total
Closing balance 31/12/2023	680,028	7,695,227	—	21,268	6,401,782		— (1,584,816)	(39,621)		1,332,181 (162,103)	(498,953)	—		34,213 13,879,206
Effects of corrections of errors	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Effects of changes in accounting policies	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Opening balance 01/01/2024	680,028	7,695,227	—	21,268	6,401,782		— (1,584,816)	(39,621)		1,332,181 (162,103)	(498,953)	—		34,213 13,879,206
Total comprehensive income for the period	—		—	—	—	—	—	—	1,826,805	—	107,850	—	1,821	1,936,476
Other equity changes	—		—	4,139	971,716	—	(78,644)		(79,731) (1,332,181) (266,808)		—	—	(1,618)	(783,127)
Issuance of ordinary shares	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Issuance of preference shares	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Issuance of other equity instruments	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Exercise or expiration of other equity instruments issued	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Conversion of debt to equity	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Capital reduction	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Dividends (or shareholder remuneration) (see Note 3)	—	—	—	—	(162,417)	—	—	—		— (428,911)	—	—	—	(591,328)
Purchase of treasury shares	—	—	—	—	—	—	—	(113,785)	—	—	—	—	—	(113,785)
Sale or cancellation of treasury shares	—	—	—	—	—	—	1,367	34,054	—	—	—	—	—	35,421
Reclassification of financial instruments from equity to liability	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Reclassification of financial instruments from liability to equity	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Transfers among components of equity	—	—	—	—	1,170,078	—	—		(1,332,181)	162,103	—	—	—	—
Equity increase or (-) decrease resulting from business combinations	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Share based payments	—	—	—	4,139	—	—	—	—	—	—	—	—	—	4,139
Other increase or (-) decrease in equity	—	—	—	—	(35,945)	—	(80,011)	—	—	—	—	—	(1,618)	(117,574)
Closing balance 31/12/2024	680,028	7,695,227	—	25,407	7,373,498		— (1,663,460)	(119,352)		1,826,805 (428,911)	(391,103)	—		34,416 15,032,555

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated statement of total changes in equity for 2024.

Consolidated statements of total changes in equity of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro

Sources of equity changes	Capital	Share premium	Equity instruments issued other than capital	Other equity	Retained earnings	Revaluation reserves	Other reserves	(-) Treasury shares	Profit or loss attributable to owners of the parent	(-) Interim dividends	Accumulated other comprehensi ve income	Minority interests: Accumulated other comprehensi ve income	Minority interests: Other items	Total
Closing balance 31/12/2022 (*)	703,371	7,899,227	—	21,548	5,859,520		— (1,365,777)	(23,767)		858,642 (112,040)	(650,647)	—		34,344 13,224,421
Effects of corrections of errors	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Effects of changes in accounting policies	—	—	—	—	—	—	(236,302)	—	30,750	—	67,247	—	—	(138,305)
Opening balance 01/01/2023	703,371	7,899,227	—	21,548	5,859,520		— (1,602,079)	(23,767)		889,392 (112,040)	(583,400)	—		34,344 13,086,116
Total comprehensive income for the period	—	—	—	—	—	—	—	—	1,332,181	—	84,447	—	1,422	1,418,050
Other equity changes	(23,343)	(204,000)	—	(280)	542,262	—	17,263	(15,854)	(889,392)	(50,063)	—	—	(1,553)	(624,960)
Issuance of ordinary shares	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Issuance of preference shares	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Issuance of other equity instruments	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Exercise or expiration of other equity instruments issued	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Conversion of debt to equity	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Capital reduction (see Note 23)	(23,343)	(204,000)	—	—	—	—	23,343	204,000	—	—	—	—	—	—
Dividends (or shareholder remuneration) (see Note 3)	—	—	—	—	(111,645)	—	—	—		— (162,103)	—	—	—	(273,748)
Purchase of treasury shares	—	—	—	—	—	—	—	(276,200)	—	—	—	—	—	(276,200)
Sale or cancellation of treasury shares	—	—	—	—	—	—	3,477	56,346	—	—	—	—	—	59,823
Reclassification of financial instruments from equity to liability	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Reclassification of financial instruments from liability to equity	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Transfers among components of equity	—	—	—	—	777,352	—	—	—	(889,392)	112,040	—	—	—	—
Equity increase or (-) decrease resulting from business combinations	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Share based payments	—	—	—	(280)	—	—	—	—	—	—	—	—	—	(280)
Other increase or (-) decrease in equity	—	—	—	—	(123,445)	—	(9,557)	—	—	—	—	—	(1,553)	(134,555)
Closing balance 31/12/2023	680,028	7,695,227	—	21,268	6,401,782		— (1,584,816)	(39,621)		1,332,181 (162,103)	(498,953)	—		34,213 13,879,206

Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated statement of total changes in equity for 2024.

(*) Correspond to balances included in the Consolidated annual financial statements for 2022 signed off by the directors of Banco de Sabadell, S.A.

Consolidated cash flow statements of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro	Note	2024	2023 (*)
Cash flows from operating activities		(11,071,457)	(10,523,303)
Profit or loss for the year		1,828,626	1,333,603
Adjustments to obtain cash flows from operating activities		1,772,165	1,912,593
Depreciation and amortisation		501,039	518,965
Other adjustments		1,271,126	1,393,628
Net increase/decrease in operating assets		(16,696,142)	3,764,543
Financial assets held for trading		(732,466)	1,310,764
Non-trading financial assets mandatorily at fair value through profit or loss		(15,089)	(75,756)
Financial assets designated at fair value through profit or loss		—	—
Financial assets at fair value through other comprehensive income		(99,278)	(431,840)
Financial assets at amortised cost		(16,242,203)	3,146,531
Other operating assets		392,894	(185,156)
Net increase/decrease in operating liabilities		2,400,345	(17,125,186)
Financial liabilities held for trading		(486,025)	(731,024)
Financial liabilities designated at fair value through profit or loss		—	—
Financial liabilities at amortised cost		3,656,483	(16,558,167)
Other operating liabilities		(770,113)	164,005
Income tax receipts or payments		(376,451)	(408,856)
Cash flows from investing activities		(245,919)	(163,020)
Payments		(548,782)	(533,861)
Tangible assets	15	(200,897)	(236,420)
Intangible assets	16	(346,193)	(296,085)
Investments in joint ventures and associates	14	(1,692)	(1,356)
Subsidiaries and other business units		—	—
Non-current assets and liabilities classified as held for sale		—	—
Other payments related to investing activities		—	—
Collections		302,863	370,841
Tangible assets		119,726	122,648
Intangible assets		—	—
Investments in joint ventures and associates	14	102,196	28,669
Subsidiaries and other business units		—	—
Non-current assets and liabilities classified as held for sale		80,941	219,524
Other collections related to investing activities		—	—

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated cash flow statement for 2024.

Consolidated cash flow statements of Banco Sabadell Group

For the years ended 31 December 2024 and 2023

Thousand euro	Note	2024	2023 (*)
Cash flows from financing activities		(382,291)	(617,001)
Payments		(917,712)	(1,676,824)
Dividends	3	(591,328)	(273,748)
Subordinated liabilities	Schedule III	—	(900,000)
Redemption of own equity instruments		—	—
Acquisition of own equity instruments		(113,785)	(276,200)
Other payments related to financing activities		(212,599)	(226,876)
Collections		535,421	1,059,823
Subordinated liabilities	Schedule III	500,000	1,000,000
Issuance of own equity instruments		—	—
Disposal of own equity instruments		35,421	59,823
Other collections related to financing activities		—	—
Effect of changes in foreign exchange rates		95,926	28,782
Net increase (decrease) in cash and cash equivalents		(11,603,741)	(11,274,542)
Cash and cash equivalents at the beginning of the year	7	29,985,853	41,260,395
Cash and cash equivalents at the end of the year	7	18,382,112	29,985,853
Memorandum item
CASH FLOWS CORRESPONDING TO:
Interest received		9,616,961	8,552,871
Interest paid		4,665,824	2,985,133
Dividends received		6,387	8,413
COMPONENTS OF CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
Cash on hand	7	710,780	726,122
Cash equivalents in central banks	7	17,105,586	28,566,694
Other demand deposits	7	565,746	693,037
Other financial assets			—
Less: bank overdrafts repayable on demand			—
TOTAL CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR		18,382,112	29,985,853
Of which: held by Group entities but not available for the Group		—	—

(*) Shown for comparative purposes only.

Notes 1 to 43 and accompanying Schedules I to V form an integral part of the consolidated cash flow statement for 2024.

Consolidated report of Banco Sabadell Group for the year ended 31 December 2024

Note 1 – Activity, accounting policies and practices, and other information

1.1 Activity

Banco de Sabadell, S.A. (hereinafter also referred to as Banco Sabadell, the Bank, the Institution, or the Company), with tax identification number (NIF) A08000143 and with registered office in Sabadell, Plaça de Sant Roc, 20, engages in banking business and is subject to the standards and regulations governing banking institutions operating in Spain. The supervision of Banco Sabadell on a consolidated basis is performed by the European Central Bank (ECB).

The Board of Directors of Banco Sabadell, in its meeting held on 22 January 2025, resolved to amend Article 2 of the articles of association to set the registered office in Sabadell, at Plaça de Sant Roc no. 20. The registered office was previously located in Alicante, at Avenida Óscar Esplá, 37.

The Institution is entered in the Companies Register of Barcelona, under volume/IRUS)¹ 1000152932861, folio 873, sheet B-1561, and also in the Bank of Spain's Official Register of Credit Institutions under code number 0081. The Legal Entity Identifier (LEI) of Banco de Sabadell, S.A. is SI5RG2M0WQQLZCXKRM20.

The articles of association and other public information can be viewed both at the Bank's registered office and on its website (www.grupbancsabadell.com).

The Bank is the parent company of a group of entities (see Note 2 and Schedule I) whose activity it controls directly or indirectly and which comprise, together with the Bank, Banco Sabadell Group (hereinafter, the Group).

1.2 Basis of presentation and changes in accounting regulations

The Group's consolidated annual financial statements for 2024 have been prepared in accordance with the International Financial Reporting Standards as adopted by the European Union (EU-IFRS) applicable as at the end of 2024, taking into account Bank of Spain (BoS) Circular 4/2017 of 27 November as well as other provisions of the financial reporting regulations applicable to the Group and considering the formatting and mark-up requirements established in Commission Delegated Regulation (EU) 2019/815, in order to fairly present the Group's equity and consolidated financial situation as at 31 December 2024 and the results of its operations, recognised income and expenses, changes in equity and cash flows (all consolidated) in 2024.

The consolidated annual financial statements have been prepared based on the accounting records kept by the Bank and each of the other entities in the Group, and include adjustments and reclassifications necessary to ensure the harmonisation of the accounting principles and policies and the measurement criteria applied by the Group, which are described in this note.

The information included in these consolidated annual financial statements is the responsibility of the directors of the Group's parent company. The Group's consolidated annual financial statements for 2024 were signed off by the directors of Banco Sabadell at a meeting of the Board of Directors on 6 February 2025 and will be submitted to shareholders at the Annual General Meeting for approval. It is expected that the shareholders will approve the accounts without significant changes.

Except as otherwise indicated, these consolidated annual financial statements are expressed in thousands of euros. In order to show the amounts in thousands of euros, the accounting balances have been subject to rounding; for this reason, some of the amounts appearing in certain tables may not be the exact arithmetic sum of the preceding figures.

¹ Unique company record identifier (Identificador Registral Único de la Sociedad, or IRUS).

Standards and interpretations issued by the International Accounting Standards Board (IASB) that entered into force in 2024

In 2024, the standards and interpretations adopted by the European Union, together with their amendments, which have been applied by the Group due to their entry into force or their early application, are the following:

Standards	Titles
Amendments to IAS 7 and IFRS 7	Supplier finance arrangements
Amendments to IAS 1	Presentation of financial statements: - Classification of liabilities as current or non-current - Non-current liabilities with covenants
Amendments to IFRS 16	Lease liabilities in sale and leaseback transactions

The application of the aforesaid standards has not given rise to any significant effects in terms of these consolidated annual financial statements.

Amendments to IAS 7 and IFRS 7 "Supplier finance arrangements"

The purpose of these amendments is to require institutions to provide additional breakdowns of their supplier finance arrangements. To that end, new requirements have been developed to ensure that information is provided to users of financial statements that allows them to assess how supplier finance arrangements affect the Institution's cash flows and liabilities, and to understand the impact of those supplier finance arrangements on the Institution's exposure to liquidity risk and how it might be affected if the arrangements were no longer in effect.

Amendments to IAS 1 "Presentation of financial statements"

Classification of liabilities as current or non-current

These amendments are designed to make clear how institutions should classify debts and other liabilities as current and non-current, in particular liabilities with no fixed maturity and those that may be converted to equity.

Non-current liabilities with covenants

The purpose of these amendments is to clarify how the conditions agreed in a loan (the 'covenants') affect the classification of that loan as either a current or a non-current liability according to whether those conditions must be complied with before or after the date of the financial statements. These amendments alter the "Classification of liabilities as current or non-current".

Amendments to IFRS 16 "Lease liabilities in sale and leaseback transactions"

These amendments specify the requirements that a seller-lessee must use to measure the lease liability arising from a sale and leaseback transaction to ensure that the seller-lessee does not recognise any gain or loss related to the right of use that it retains.

Standards and interpretations issued by the IASB not yet in force

As at 31 December 2024, the most significant standards and interpretations that have been published by the IASB but which have not been applied when preparing these consolidated annual financial statements, either because their effective date is subsequent to the date thereof or because they have not yet been endorsed by the European Union, are as follows:

Standards and Interpretations	Title	Mandatory for years beginning:
Approved for application in the EU
Amendments to IAS 21	Lack of exchangeability	1 January 2025
Not approved for application in the EU
Amendments to IFRS 9 and IFRS 7	- Amendments to the classification and measurement of financial instruments - Contracts referencing nature-dependent electricity	1 January 2026
Annual improvements to IFRS	Volume 11	1 January 2026
IFRS 18	Presentation and disclosure in financial statements	1 January 2027
IFRS 19	Subsidiaries without public accountability: disclosures	1 January 2027

Except for the potential impact on presentation and disclosure resulting from the adoption of IFRS 18, it is estimated that the adoption of the amendments issued by the IASB not yet in effect will not have a significant impact for the Group.

Approved for application in the EU

Amendments to IAS 21 "Lack of exchangeability"

These amendments aim to require institutions to apply a consistent approach in assessing whether a currency can be exchanged into another currency and, when it cannot, in determining the exchange rate to use and the disclosures to provide.

Earlier application of these amendments is permitted. If they are applied to a period prior to the date of mandatory application, the Institution must indicate this.

Not approved for application in the EU

Amendments to IFRS 9 and IFRS 7 "Amendments to the classification and measurement of financial instruments"

These amendments form part of the post-implementation review of the classification and measurement requirements of IFRS 9 "Financial instruments", as well as the requirements related to IFRS 7 "Financial instruments: disclosures".

The main changes to the requirements relate to:

• settling financial liabilities using an electronic payment system; and
• assessing contractual cash flow characteristics of financial assets, including those with Environmental, Social and Governance (ESG)-linked features.

The amendments also concern the disclosure requirements relating to investments in equity instruments designated at fair value through other comprehensive income and include additional disclosure requirements for financial instruments with contingent characteristics that do not relate directly to the risks and costs of a basic lending arrangement.

The application of the amendments to IFRS 9 should be carried out retrospectively, although it is not mandatory to restate information from previous years. Earlier application of either all the amendments at the same time or only the amendments related to the classification of financial assets is permitted.

Amendments to IFRS 9 and and IFRS 7 "Contracts referencing nature-dependent electricity"

The purpose of these amendments is to improve the information disclosed by banks in their financial statements in relation to nature-dependent electricity contracts, generally structured as Power Purchase Agreements (PPAs). Earlier application of these amendments is permitted.

Annual improvements to IFRS Accounting Standards - Volume 11

These amendments include clarifications, simplifications, corrections and minor changes aimed at improving the consistency of the following standards: IFRS 1 "First-time adoption of international financial reporting standards", IFRS 7 "Financial instruments: disclosures" and its accompanying guidance on implementation, IFRS 9 "Financial instruments", IFRS 10 "Consolidated financial statements" and IAS 7 "Statement of cash flows".

IFRS 18 "Presentation and disclosure in financial statements"

IFRS 18, which will replace IAS 1, aims to improve the quality of financial reporting, as it:

• introduces defined categories for income and expenses (operating, investing and financing) and requires defined subtotals for each category (i.e. operating profit) in the income statement;
• requires the disclosure of information on Management-defined Performance Measures (MPMs) in the notes to the financial statements; and
• adds new principles for the aggregation and disaggregation of financial information.

In addition, IFRS 18 introduces narrow-scope amendments, among others, to IAS 7 "Statement of cash flows", IAS 33 "Earnings per share" and IAS 34 "Interim financial reporting". These changes should be applied as from the date of entry into force of IFRS 18.

The Bank considers that IFRS 18 will mainly have an impact on the presentation and disclosure of the consolidated income statement as a result of adapting the templates used for the consolidated financial statements to the aforesaid amendments.

The application of IFRS 18 on the date of its entry into force should be carried out retrospectively. Earlier application will also be permitted.

IFRS 19 "Subsidiaries without public accountability: disclosures"

This standard allows certain subsidiaries to provide reduced disclosures when applying IFRS accounting standards in their financial statements. IFRS 19 is optional for subsidiaries that are eligible, setting out the disclosure requirements for subsidiaries that elect to apply it. For these purposes, eligible subsidiaries are those that do not have public accountability (meaning that their debt or equity instruments are not traded in a public market, they are not in the process of issuing instruments to trade in a public market, and they do not hold assets in a fiduciary capacity for a broad group of outsiders as one of their primary businesses) for which their parent company produces consolidated financial statements available for public use that comply with IFRS accounting standards. Earlier application of this standard is permitted.

Judgements and estimates

The preparation of the consolidated annual financial statements requires certain accounting estimates to be made. It also requires Management to use its best judgement in the process of applying the Group's accounting policies. Such judgements and estimates may affect the value of assets and liabilities and the disclosure of contingent assets and contingent liabilities as at the date of the consolidated annual financial statements, as well as income and expenses in the year.

The main judgements and estimates relate to the following:

• The accounting classification of financial assets and off-balance sheet exposures according to their credit risk (see Notes 1.3.4, 8, 11 and 26).
• Impairment losses on certain financial assets and off-balance sheet exposures (see Notes 1.3.4, 4.4.2.5, 8, 11 and 26).
• – The assumptions used in actuarial calculations of liabilities and post-employment obligations (see Notes 1.3.17 and 22).
• The measurement of consolidated goodwill (see Notes 1.3.12 and 16).
• The useful life and impairment losses of tangible assets and other intangible assets (see Notes 1.3.10, 1.3.11, 1.3.12, 15 and 16).
• The provisions and consideration of contingent liabilities (see Notes 1.3.16 and 22).
• The fair value of certain unquoted financial assets (see Notes 1.3.3 and 6).
• The fair value of real estate assets held on the balance sheet (see Notes 1.3.9, 1.3.10, 1.3.13 and 6).
• The recoverability of non-monetisable deferred tax assets and tax credits (see Notes 1.3.20 and 39).

The estimates are based on the best knowledge to hand about current and foreseeable circumstances, taking into account the uncertainties stemming from the existing economic and geopolitical environment and, consequently, the final results could differ from these estimates, particularly in relation to impairment losses on certain financial assets and off-balance sheet exposures. Future events may therefore make it necessary to modify these estimates, which would involve recording the effects of such estimation changes, if any, in the Group's consolidated financial statements on a forward-looking basis, in accordance with applicable regulations. The macroeconomic scenarios considered by the Group in its main estimates and the sensitivity of financial asset impairment allowances to changes in the main variables considered in the macroeconomic scenarios are described in Note 4.4.2.5 "Calculation of credit loss allowances".

1.3 Accounting principles and policies and measurement criteria

The accounting principles and policies, as well as the most significant measurement criteria applied when preparing these consolidated annual financial statements, are described below. There are no cases in which accounting principles or measurement criteria have not been applied because of a significant effect on the Group's consolidated annual financial statements for 2024.

1.3.1 Consolidation principles

In the consolidation process, a distinction is drawn between subsidiaries, joint ventures, associates and structured entities.

Subsidiaries

Subsidiaries are entities over which the Group has control. This occurs when the Group is exposed, or has rights, to variable returns from its involvement with the investee and when it has the ability to affect those returns through its power over the investee.

For control to exist, the following criteria must be met:

• Power: an investor has power over an investee when the investor has existing rights that give it the current ability to direct the relevant activities, i.e. the activities that significantly affect the investee's returns.
• Returns: an investor is exposed, or has rights, to variable returns from its involvement with the investee when the investor's returns from its involvement have the potential to vary as a result of the investee's performance. The investor's returns can be only positive, only negative, or both positive and negative.
• Relationship between power and returns: an investor controls an investee if the investor not only has power over the investee and exposure or rights to variable returns from its involvement with the investee, but also has the ability to use its power to affect the investor's returns from its involvement with the investee.

When the Group takes control of a subsidiary, it applies the acquisition method provided for in the regulations governing business combinations (see Note 1.3.2) except in the case of acquisitions of an asset or a group of assets.

The financial statements of subsidiaries are consolidated with the Bank's financial statements using the full consolidation method.

The third-party ownership of the Group's consolidated equity is shown under the heading "Minority interests [non-controlling interests]" of the consolidated balance sheet and the portion of the profit or loss for the year attributable to those interests is disclosed under the heading "Profit or (-) loss for the year - Attributable to minority interest [non-controlling interests]" in the consolidated income statement.

As at 31 December 2024, there were no Group companies qualifying as subsidiary undertakings in which an interest of less than 50% was held. Similarly, as at the aforesaid date, the Group neither managed nor consolidated any investment fund or any pension fund.

Joint ventures

These are entities subject to joint control contractual arrangements whereby decisions about the relevant activities are made unanimously by the entities that share control.

Investments in joint ventures are accounted for using the equity method, i.e. by the fraction of equity represented by the share held in their capital stock, after taking account of any dividends received from them and any other equity disposals.

The Group held no investments in joint ventures in 2024 and 2023.

Associates

Associates are entities over which the Group exerts significant influence, which generally, although not exclusively, takes the form of a direct or indirect interest representing 20% or more of the investee's voting rights. The Group also considers other factors when determining whether it exerts significant influence over an investee, including the representation on its Board of Directors, involvement in decision-making and the existence of significant transactions between both entities.

In the consolidated annual financial statements, associates are accounted for using the equity method.

Notwithstanding the foregoing, when the Group's investment in an associate is held directly by, or is held indirectly through, a venture capital organisation or similar entity, it may elect to measure that investment at fair value through profit or loss in accordance with IFRS 9. This election is made separately for each associate on the date of its initial recognition. Similarly, when the Group has an interest in an associate that is an investment entity, it may, when applying the equity method, elect to retain the fair value measurement applied by that investment entity associate to its subsidiaries. This election is made separately for each investment entity associate, at the later of the date on which (a) the associate is initially recognised, (b) the associate becomes an investment entity, or (c) the associate first becomes a parent of a group of entities.

As at 31 December 2024, investments in entities qualifying as associates even though the Group holds less than 20% of the voting rights and investments in entities not qualifying as associates even though the Group holds at least 20% of their voting rights were not significant. Given the absence of any significant transactions between the Bank and the aforesaid entities, the main factor that currently determines the existence of significant influence is its representation, or absence thereof, in the management bodies of the investee undertaking.

Structured entities

A structured entity is an entity that has been designed so that voting or other similar rights are not the dominant factor in deciding who controls the entity.

Where the Group holds an interest in an entity, or where it incorporates an entity, in order to transfer risks or for any other purposes, or to allow customers access to certain investments, it determines whether there is control over the entity based on that provided in regulations, as described above, in order to consequently determine whether it should be subject to consolidation. Specifically, the following factors, among others, are considered:

• Analysis of the Group's influence over the relevant activities of the entity that could influence the amount of its returns.
• Implicit or explicit commitments of the Group to provide financial support to the entity.
• Identification of the entity's manager and analysis of the remuneration scheme.
• Existence of removal rights (possibility of dismissing managers).
• Significant exposure of the Group to the variable returns on the entity's assets.

These entities include those known as 'asset securitisation funds', which are consolidated in cases where, based on the above analysis, it is determined that the Group has maintained control. For these operations, contractual arrangements for financial support commonly used in securitisation markets are generally in place, and there are no commitments to provide any financial support that goes significantly beyond what has been contractually agreed. It is therefore considered that, for the majority of securitisations carried out by the Group, the securitised assets cannot be derecognised and the securities issued by securitisation funds are recognised as liabilities on the consolidated balance sheet.

Schedule II provides details of the Group's structured entities.

In all cases, the profit or loss generated by companies forming part of the Group during a given year is consolidated considering only the profit or loss relating to the period spanning from the acquisition date to year-end. Similarly, the profit or loss generated by companies disposed of during the year is consolidated considering only the profit or loss relating to the period spanning from the start of the year to the disposal date.

In the consolidation process, all material balances and transactions between the companies forming part of the Group have been eliminated, in the proportion corresponding to them based on the method of consolidation applied.

Financial and insurance institutions, both subsidiaries and associates, regardless of the country in which they are located, are subject to supervision and regulation by various bodies. The laws in effect in the various jurisdictions, along with the need to meet certain minimum capital requirements and the performance of supervisory activities, are circumstances that could affect the ability of those institutions to transfer funds in the form of cash, dividends, loans or advances.

Note 2 includes information on the most significant acquisitions and disposals that have taken place during the year. Significant disclosures regarding the Group's companies are provided in Schedule I.

1.3.2 Business combinations

A business combination is a transaction or any other event in which the Group obtains control of one or more businesses. Business combinations are accounted for using the acquisition method.

Under this method, the acquiring entity (acquirer) recognises the assets acquired and liabilities assumed in its financial statements, also considering contingent liabilities, measured at their fair value, including those that the acquired entity (acquiree) had not recognised in its accounts. This method also requires the cost of the business combination to be estimated, which will normally correspond to the consideration paid, defined as the fair value, on the acquisition date, of the assets delivered, the liabilities incurred against the former owners of the acquired business and the equity instruments issued, if any, by the acquirer.

The Group then recognises goodwill in the consolidated annual financial statements if on the acquisition date there is a positive difference between:

• the sum of the consideration paid plus the amount of all minority interests and the fair value of prior interests held in the acquired business; and
• the fair value of recognised assets and liabilities.

If the difference is negative, it is recorded under the heading "Negative goodwill recognised in profit or loss" in the consolidated income statement.

In cases where the consideration amount depends on future events, any contingent consideration is recognised as part of the consideration paid and measured at fair value on the acquisition date. The costs associated with the transaction do not form part of the cost of the business combination for these purposes.

If the cost of the business combination or the fair value assigned to the acquiree's assets, liabilities or contingent liabilities cannot be conclusively determined, the initial accounting of the business combination will be considered provisional. In any event, the process should be completed within a maximum of one year from the acquisition date and effective as of that date.

Minority interests in the acquiree are measured on the basis of the proportional percentage of its identified net assets. All purchases and disposals of these minority interests are accounted for as capital transactions when they do not result in a change of control. No profit or loss is recognised in the consolidated income statement and the initially recognised goodwill is not remeasured. Any difference between the consideration paid or received and the decrease or increase in minority interests, respectively, is recognised in reserves.

With regard to non-monetary contributions of businesses to associates or joint ventures in which there is a loss of control over those businesses, the Group's accounting policy is to record the full profit or loss in the consolidated income statement, recognising any remaining interest held at its fair value.

1.3.3 Classification and measurement of financial instruments and recognition of changes arising in their subsequent measurement

In general, all financial instruments are initially recognised at fair value (see definition in Note 6) which, unless evidence to the contrary is available, coincides with the transaction price. For financial instruments not recognised at fair value through profit or loss, the fair value is adjusted by either adding or deducting the transaction costs directly attributable to their acquisition or issuance. In the case of financial instruments at fair value through profit or loss, the directly attributable transaction costs are recognised immediately in the consolidated income statement. As a general rule, conventional purchases and sales of financial assets are recognised at the settlement date.

Changes in the value of financial instruments originating from the accrual of interest and similar items are recorded in the consolidated income statement, under the headings "Interest income" or "Interest expenses", as applicable. Dividends received from other companies are recognised in the consolidated income statement for the year in which the right to receive them is originated.

Instruments that form part of a hedging relationship are treated in accordance with regulations applicable to hedge accounting.

Changes in measurements occurring subsequent to initial recognition for reasons other than those mentioned above are treated according to the classification of financial assets and financial liabilities for the purposes of their measurement. In the case of financial assets, classification is generally based on the following aspects:

• the business model under which they are managed, and
• their contractual cash flow characteristics.

Business model

A business model refers to the way in which financial assets are managed in order to generate cash flows. The business model is determined by considering the way in which groups of financial assets are managed together to achieve a particular objective. Therefore, the business model does not depend on the Group's intentions for an individual instrument, rather, it is determined for a group of instruments.

The business models used by the Group are indicated here below:

• Business model whose objective is to hold financial assets in order to collect contractual cash flows: under this model, financial assets are managed in order to collect their particular contractual cash flows, rather than to obtain an overall return by both holding and selling assets. The above notwithstanding, assets can be disposed of prior to maturity in certain circumstances. Sales that may be consistent with a business model whose objective is to hold assets in order to collect contractual cash flows include sales that are infrequent or insignificant in value, sales of assets close to maturity, sales triggered by an increase in credit risk and sales carried out to manage credit concentration risk.
• Business model whose objective is to sell financial assets.
• Business model that combines the two objectives above (hold financial assets in order to collect contractual cash flows and sell financial assets): this business model typically involves greater frequency and value of sales because such sales are integral to achieving the business model's objective.

Contractual cash flow characteristics of financial assets

Financial assets should initially be classified in one of the following two categories:

• Those whose contractual terms give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal amount outstanding.
• All other financial assets.

For the purposes of this classification, the principal of a financial asset is its fair value at initial recognition, which could change over the life of the financial asset; for example, if there are repayments of principal. Interest is understood as the sum of consideration for the time value of money, for lending and structural costs, and for the credit risk associated with the principal amount outstanding during a particular period of time, plus a profit margin.

If a financial asset contains contractual terms that could change the timing or amount of cash flows, the Group will estimate the cash flows that could arise before and after the change and determine whether these are Solely Payments of Principal and Interest (SPPI) on the principal amount outstanding.

The most significant judgements used in this evaluation are indicated here below:

• Modified time value of money: in order to determine whether the interest rate of a transaction incorporates any consideration other than that linked to the passage of time, transactions that present a difference between the tenor of the benchmark interest rate and the reset frequency of that interest rate are analysed, considering a tolerance threshold, in order to determine whether the instrument's contractual undiscounted cash flows could be significantly different from the contractual undiscounted benchmark cash flows of a financial instrument whose time value of money element was not modified. At present, tolerance thresholds of 10% and 5%, respectively, are used for the differences in each tenor and for the analysis of cumulative cash flows over the life of the financial asset.
• Contractual terms that change the timing or amount of cash flows: an analysis is carried out to determine whether any contractual terms exist that could change the timing or amount of contractual cash flows from the financial asset:
  • Clauses for conversion to equity shares: clauses that include a conversion-to-equity option and the loss of the right to claim contractual cash flows in the event the principal amount is reduced due to insufficient funds. Contracts that include this option will automatically fail the SPPI test.
  • Existence of the option to prepay or extend the financial instrument, or extend the contractual term, and possible residual compensation: a financial asset will fulfil the SPPI test requirements if it includes a contractual option that permits the issuer (or debtor) to prepay a debt instrument or to put back a debt instrument before maturity and the prepayment amount substantially represents unpaid amounts of principal and interest outstanding, which may include reasonable additional compensation for the early termination of the contract.
  • Financial assets with interest rates linked to environmental, social or governance targets (ESG-linked features): these financial assets provide general funding at a contractual interest rate that is discounted based on the level of compliance, by customers, of certain environmental metrics, not requiring any specific destination for the funds, the purpose of the adjustment being to incentivise the achievement of those targets. The key consideration here is whether the resulting cash flows reflect a return for risk that is unrelated to a basic lending arrangement. Thus, if the adjustment linked to ESG targets does not introduce compensation for risks that is inconsistent with a basic lending arrangement, or if it does so only residually, then it is considered that the financial asset has contractual cash flows that are compatible with a basic lending arrangement. As at 31 December 2024 and 2023, the impacts of environmental clauses on the interest rate applied to transactions whose remuneration is linked to ESG targets are considered to be residual for the purposes of the SPPI test. Similarly, in general terms, those financing transactions do not include other characteristics that could call into question their status as basic lending arrangements.
  • Other clauses that could change the timing or amount of cash flows: clauses that could alter contractual cash flows as a result of changes in credit risk are considered to pass the SPPI test.
• Leverage: financial assets with leverage (i.e. those in which the contractual cash flow variability increases, such that they do not have the same economic characteristics as the interest rate on the principal amount of the transaction) fail the SPPI test.
• Contractually linked financial instruments: the cash flows arising from these types of financial instruments are considered to consist solely of payments of principal and interest on the principal amount outstanding provided that:
  • the contractual terms of the tranche being assessed for classification (without looking through to the underlying pool of financial instruments) give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding;
  • the underlying pool of financial instruments contains instruments with contractual cash flows that are solely payments of principal and interest on the principal amount outstanding; and
  • the exposure to credit risk corresponding to the tranche being assessed is equal to or lower than the exposure to credit risk of the underlying pool of financial instruments.
• Non-recourse financial assets: in the case of debt instruments that are primarily repaid with cash flows from specified assets or projects and for which there is no personal liability for the holder, an assessment is made of the underlying assets or cash flows to determine whether the contractual cash flows of the instrument are payments of principal and interest on the principal amount outstanding.

For cases in which a financial asset characteristic is inconsistent with a basic lending arrangement (i.e. if any of the asset's characteristics give rise to contractual cash flows other than payments of principal and interest on the principal amount outstanding), the significance and probability of occurrence is assessed to determine whether that characteristic should be taken into account in the SPPI test:

• To determine the significance of a financial asset characteristic, the impact that it could have on contractual cash flows is estimated. The impact is not considered significant (de minimis effect) if it is estimated that the change in expected cash flows will be below the tolerance thresholds indicated previously.
• If an instrument's characteristic could have a significant effect on the contractual cash flows but would only affect the instrument's contractual cash flows upon occurrence of an event that is very unlikely to occur, that characteristic will not be taken into account to determine whether the contractual cash flows of the instrument are solely payments of principal and interest on the principal amount outstanding.

Portfolios of financial instruments classified for the purpose of their measurement

Financial assets and financial liabilities are classified, for the purpose of their measurement, into the following portfolios, based on the aspects described above:

Financial assets at amortised cost

This category includes financial assets that meet the following two conditions:

• They are managed with a business model whose objective is to hold financial assets in order to collect contractual cash flows; and
• Their contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

This category comprises investments associated with typical lending activities, such as amounts loaned to customers withdrawn in cash and not yet repaid, deposits placed with other institutions, regardless of the legal arrangements under which the funds were provided, debt securities that meet the two conditions indicated above, as well as debts incurred by purchasers of goods or users of services forming part of the Group's business.

Following their initial recognition, financial assets classified in this category are measured at amortised cost, which should be understood as the acquisition cost adjusted to account for repayments of principal and the portion recognised in the consolidated income statement, using the effective interest rate method, of the difference between the initial cost and the corresponding repayment value at maturity. In addition, the amortised cost is decreased by any reduction in value due to impairment recognised directly as a decrease in the value of the asset or through an allowance or offsetting item of the same value.

The effective interest rate is the rate that exactly discounts the value of a financial instrument to the estimated cash flows over the expected life of the instrument, on the basis of its contractual terms, such as early repayment options, but without taking into account expected credit losses. For fixed-rate financial instruments, the effective interest rate coincides with the contractual interest rate set at the time of their acquisition, considering, where appropriate, the fees, transaction costs, premiums or discounts which, because of their nature, may be likened to an interest rate. In the case of floating-rate financial instruments, the effective interest rate coincides with the rate of return in respect of all applicable concepts until the date of the first scheduled benchmark rate revision.

Financial assets at fair value through other comprehensive income

This category includes financial assets that meet the following two conditions:

• They are managed with a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
• The contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

These financial assets primarily correspond to debt securities.

Furthermore, the Group may opt, at initial recognition and irrevocably, to include in the portfolio of financial assets at fair value through other comprehensive income investments in equity instruments that should not be classified as held for trading and which would otherwise be classified as financial assets mandatorily at fair value through profit or loss. This option is exercised on an instrument-by-instrument basis.

Income and expenses from financial assets at fair value through other comprehensive income are recognised in accordance with the following criteria:

• Interest accrued or, where applicable, dividends accrued are recognised in the consolidated income statement.
• Exchange differences are recognised in the consolidated income statement when they relate to monetary financial assets, or through other comprehensive income when they relate to nonmonetary financial assets.
• Losses due to impairment of debt instruments, or gains due to their subsequent recovery, are recognised in the consolidated income statement.
• Other changes in value are recognised through other comprehensive income.

When a debt instrument measured at fair value through other comprehensive income is derecognised from the balance sheet, the amount corresponding to the fair value change recognised under the heading "Accumulated other comprehensive income" of the consolidated statement of equity is reclassified to the consolidated income statement. However, when an equity instrument measured at fair value through other comprehensive income is derecognised from the balance sheet, this amount is not reclassified to the consolidated income statement, but rather to reserves.

Financial assets at fair value through profit or loss

A financial asset is classified in the portfolio of financial assets at fair value through profit or loss whenever the business model used by the Group for its management or its contractual cash flow characteristics make it inadvisable to classify it into any of the other portfolios described above.

This portfolio is in turn subdivided into:

– Financial assets held for trading

Financial assets held for trading are those which have been acquired for the purpose of realising them in the near term, or which form part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent pattern of short-term profit-taking. Financial assets held for trading also include derivative instruments that do not meet the definition of a financial guarantee contract and have not been designated as hedging instruments.

– Non-trading financial assets mandatorily at fair value through profit or loss

All other financial assets mandatorily at fair value through profit or loss are classified in this portfolio.

Fair value changes are directly recognised in the consolidated income statement, making a distinction, in the case of non-derivative instruments, between the portion attributable to returns accrued on the instrument, which are recognised either as "Interest income", applying the effective interest rate method, or as dividends, depending on their nature, and the remaining portion, which is recognised as profit or loss on financial operations under the corresponding heading.

In 2024 and 2023, no significant reclassifications took place between the portfolios in which financial assets are recognised for the purpose of their measurement.

Financial liabilities held for trading

Financial liabilities held for trading include financial liabilities that have been issued for the purpose of repurchasing them in the near term, or which form part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent pattern of short-term profit-taking. They also include short positions arising from the outright sale of assets acquired in reverse repurchase agreements, borrowed in securities lending or received as collateral with sale rights, as well as derivative instruments that do not meet the definition of a financial guarantee contract and have not been designated as hedging instruments.

Fair value changes are directly recognised in the consolidated income statement, making a distinction, in the case of non-derivative instruments, between the portion attributable to returns accrued on the instrument, which are recognised as interest applying the effective interest rate method, and the remaining portion, which is recognised as profit or loss on financial operations under the corresponding heading.

Financial liabilities at amortised cost

Financial liabilities at amortised cost are financial liabilities that cannot be classified into any of the above categories and which relate to the typical deposit-taking activity of a financial institution, irrespective of their substance and maturity.

Following initial recognition, financial liabilities at amortised cost are measured applying the same criteria applicable to financial assets at amortised cost, generally recognising the interest accrued, calculated using the effective interest rate method, in the consolidated income statement.

The financial liabilities at amortised cost category includes preferred securities contingently convertible into ordinary shares that meet the requirements that make them eligible in terms of own funds as Additional Tier 1 capital and therefore do not meet the requirements to be classified as consolidated equity for accounting purposes. Their main characteristics are that they have no defined maturity, they can be redeemed by the issuer in certain circumstances, the associated coupon payments are discretionary, and they can be converted into a variable number of ordinary shares newly issued by the Bank where the latter or its consolidated group have a CET1 ratio below 5.125%.

Taking the foregoing into account, these securities are compound financial instruments that simultaneously present attributes of financial liabilities (i.e. there are conversion scenarios in which the issuer must deliver a variable number of its equity instruments to cancel the issuance) and of equity (i.e. discretionary coupon payments). The Institution estimates that the fair value of the liability component of the compound financial instrument as at the date of origination corresponds to the payment that would need to be made if an instantaneous conversion event were to occur, so the amount allocated to that component is the entire carrying amount of the issued instrument, which is classified under the heading "Financial liabilities at amortised cost – Debt securities issued" on the consolidated balance sheet. Furthermore, given that the Institution has the discretion to decide to pay the coupons associated with these instruments, those coupons are considered equity distributions and they are recognised under the "Other reserves" heading of the balance sheet on each payment date, reducing the Institution's equity.

Hybrid financial instruments

Hybrid financial instruments are those that combine a non-derivative host contract and a financial derivative, known as an 'embedded derivative', which cannot be transferred separately, nor does it have a different counterparty, and which results in some of the cash flows of the hybrid instrument varying in a similar way to the cash flows that would exist if the derivative were considered separately.

Generally, where the host contract of a hybrid financial instrument is a financial asset, the embedded derivative is not separated and the measurement rules are applied to the hybrid financial instrument as a whole.

Where the host contract of a hybrid financial instrument is a financial liability, the embedded derivatives of that contract are accounted for separately if the economic characteristics and risks of the embedded derivative are not closely related to those of the host contract, if a separate financial instrument with the same terms as the embedded derivative would meet the definition of a derivative instrument, and if the hybrid contract is not fully measured at fair value through profit or loss.

Most of the hybrid financial liabilities issued by the Group are instruments whose payments of principal and/ or interest are indexed to specific equity instruments (generally, shares of listed companies), to a basket of shares, to stock market indices (such as IBEX and NYSE), or to a basket of stock market indices.

The fair value of the Group's financial instruments as at 31 December 2024 and 2023 is indicated in Note 6.

1.3.4 Impairment of financial assets

A financial asset or a credit exposure is considered to be impaired when there is objective evidence that one or more events have occurred whose direct or combined effect gives rise to:

• In the case of debt instruments, including loans and debt securities, a negative impact on future cash flows estimated at the time the transaction was executed, due to the materialisation of credit risk.
• In the case of off-balance sheet exposures that carry credit risk, expected inflows that are lower than the contractual cash flows due if the holder of a loan commitment draws down the loan or, in the case of financial guarantees given, inflows that are lower than the payments scheduled to be made.
• In the case of investments in joint ventures and associates, a situation in which their carrying amount cannot be recovered.

1.3.4.1 Debt instruments and off-balance sheet exposures

Impairment losses on debt instruments and other off-balance sheet credit exposures are recognised as an expense in the consolidated income statement for the year in which the impairment is estimated. The recoveries of any previously recognised losses are also recognised in the consolidated income statement for the year in which the impairment is eliminated or reduced.

The impairment of financial assets is calculated based on the type of instrument and other circumstances that could affect it, after taking into account any effective guarantees received. For debt instruments measured at amortised cost, the Group recognises both allowances, when loan loss provisions are allocated to absorb impairment losses, as well as direct write-offs, when the probability of recovery is considered to be remote. For debt instruments at fair value through other comprehensive income, impairment losses are recognised in the consolidated income statement, with a balancing entry under the heading "Accumulated other comprehensive income" on the consolidated statement of equity. Impairment allowances for offbalance sheet exposures are recognised on the liabilities side of the consolidated balance sheet as a provision.

For risks classified as stage 3 (see section "Definition of classification categories" in this note), accrued interest is recognised in the consolidated income statement by applying the effective interest rate to its amortised cost adjusted to account for any impairment allowances.

To determine impairment losses, the Group monitors borrowers individually, at least all those who are significant borrowers, and collectively, for groups of financial assets with similar credit risk characteristics that reflect borrowers' ability to satisfy their outstanding payments.

The Group has policies, methods and procedures in place to estimate the losses that it may incur as a result of its credit risks, due to both insolvency attributable to counterparties and country risk. These policies, methods and procedures are applied when granting, assessing and arranging debt instruments and off-balance sheet exposures, when identifying their possible impairment and, where applicable, when calculating the amounts necessary to cover these expected losses.

1.3.4.1.1 Accounting classification on the basis of credit risk attributable to insolvency

The Group has established criteria that allow borrowers showing a significant increase in credit risk, vulnerabilities or objective evidence of impairment to be identified and classified on the basis of their credit risk.

The following sections describe the classification principles and methodology used by the Group.

Definition of classification categories

Credit exposures and off-balance sheet exposures are both classified, on the basis of their credit risk, into the following stages:

• Stage 1: standard exposures, i.e. transactions whose risk profile has not changed since they were granted and for which there are no doubts as to the fulfilment of repayment commitments in accordance with the contractually agreed terms.
• Stage 2: standard exposures under special monitoring, i.e. transactions which, although they do not meet the criteria to be classified individually as stage 3 or write-offs, show a Significant Increase in Credit Risk (SICR) since initial recognition. This category includes, among other transactions, those in which there are amounts more than 30 days past due, with the exception of non-recourse factoring, for which a threshold of more than 60 days is applied (the amount of non-recourse factoring transactions with amounts between 30 and 60 days past due came to 12 million euros and 28 million euros as at the end of 2024 and 2023, respectively), as well as refinanced and restructured transactions not classified as stage 3 until they are classified into a lower risk category once they meet the established requirements for modifying their classification.
• Stage 3: non-performing exposures are transactions for which there are reasonable doubts as to their repayment in full in accordance with the contractually agreed terms. This category comprises debt instruments, matured or otherwise, which do not meet the conditions for classification into the write-offs category but for which there are reasonable doubts as to their repayment in full (principal and interest) by the borrower, as well as off-balance sheet exposures whose payment by the Group is likely but whose recovery is doubtful:
  • As a result of borrower arrears: all transactions, without exception, with any amount of principal, interest or contractually agreed expenses more than 90 days past due, unless they should be classified as write-offs. This category also includes debt transactions and guarantees given classified as non-performing due to the pulling effect (more than 20% of the exposures of one obligor are more than 90 days past due).
  • For reasons other than borrower arrears (unlikely-to-pay): transactions which do not meet the conditions for classification as write-offs or stage 3 as a result of borrower arrears, but for which there are reasonable doubts as to the likelihood of obtaining the estimated cash flows of the transaction, as well as off-balance sheet exposures not classified as stage 3 as a result of borrower arrears whose payment by the Group is likely but whose recovery is doubtful. This category includes transactions that were classified as stage 3 as a result of borrower arrears and which will be maintained, for a 3-month probation period, in the stage 3 category for reasons other than borrower arrears.

The accounting definition of stage 3 is in line with the definition used in the Group's credit risk management activities.

– Write-off:

The Group derecognises transactions from the consolidated balance sheet where their possibility of full or partial recovery is concluded to be remote following an individual assessment. The aspects that the Group considers to recognise transactions as write-offs include the amount of time elapsed since they were classified as stage 3 as a result of borrower arrears, the guarantees, the level of coverage, whether the borrower has filed for bankruptcy, and the portfolio to which the transactions in question relate. This also includes transactions which, despite not being in any of the previous situations, are undergoing a manifest and irreversible deterioration of their solvency.

The remaining amounts of transactions with portions that have been derecognised ('partial derecognition'), either because of the termination of the Group's debt collection rights ('definitive loss') – for reasons such as debt remissions or debt reductions – or because they are considered irrecoverable even though debt collection rights have not been terminated ('write-downs'), will be fully classified in the corresponding category on the basis of their credit risk.

In the above situations, the Group derecognises write-offs along with their associated provisions from the consolidated balance sheet, notwithstanding any actions that may be taken to collect payment until no more rights to collect payment exist, whether due to time-barring, debt remission, or for any other reasons.

Purchased or originated credit-impaired transactions

The expected credit loss on purchased or originated credit-impaired assets will not form part of the loss allowance or the gross carrying amount on initial recognition. When a transaction is purchased or originated with credit impairment, the loss allowance will be equal to the cumulative changes in lifetime expected credit losses since initial recognition. Interest income on these assets will be calculated by applying the creditadjusted effective interest rate to the amortised cost of the financial asset.

Degree of alignment between the stage 3 accounting category and the prudential definition of default

The prudential definition of default adopted by the Group bases materiality thresholds and the counting of days past due on regulatory technical standard EBA/RTS/2016/06 and all other conditions on guidelines EBA/GL/2016/07 (Guidelines on the application of the definition of default under Article 178 of Regulation (EU) No 575/2013).

In general, all contracts impaired from an accounting standpoint are also considered impaired for prudential purposes, except where they are impaired by reason of the accounting definition of default but where the past-due amounts are equal to or below a materiality threshold (exposures of 100 euros for the retail segment and of 500 euros for the non-retail segment, and where 1% of the total exposures are past-due for both cases).

Notwithstanding the foregoing, the prudential definition is generally more conservative than the accounting definition. The key differing aspects are set out here below:

• Under the prudential definition, the number of days in default are counted from the moment the first past-due amount goes above the materiality threshold. The counting cannot be restarted or reduced until the borrower has paid all past-due amounts or until the past-due amounts fall back below the materiality thresholds. Under the accounting definition, a FIFO criterion can be applied to past-due amounts when there have been partial repayments, enabling the number of days past due to be reduced for that reason.
• Under the prudential definition, a 3-month probation period exists for all amounts in default, while a 12-month probation period is used for amounts in default classified as refinancing. Under the accounting definition, the 3-month period applies only to amounts classified as stage 3 as a result of borrower arrears, while the 12-month period applies only to amounts classified as stage 3 that correspond to refinancing.
• In terms of unlikely-to-pay amounts in default (for reasons other than borrower arrears), there are explicit criteria defined at the prudential level, which are additional to those applied at the accounting level.

Transaction classification criteria

The Group applies various criteria to classify borrowers and transactions into different categories based on their credit risk. These include:

• Automatic criteria;
• Criteria based on indicators (triggers); and
• Specific criteria for refinancing.

The automatic factors and specific classification criteria for refinancing make up what the Institution refers to as the classification and cure algorithm and are applied to the entire portfolio.

Furthermore, to enable an early identification of any significant increase in credit risk or vulnerabilities, or any transaction impairment, the Group establishes different triggers for significant and non-significant borrowers. The details for each borrower group are described in the sections on "Individual assessment" and "Collective assessment", respectively. In particular, non-significant borrowers are assessed by means of a process which aims to identify any significant increase in credit risk since the transaction was first approved and which could result in losses greater than those incurred on other similar transactions classified as stage 1. For significant borrowers, on the other hand, there is an automated system of triggers in place that generates a series of alerts, which serve to indicate, during a borrower's assessment, that a decision needs to be made with regard to their classification.

As a result of the application of these criteria, the Group either classifies its borrowers as stage 2 or 3 or keeps them in stage 1.

Individual assessment

The Group has established a significance threshold in terms of exposure, which is used to classify certain borrowers as significant, meaning that their risks need to be assessed individually.

The thresholds at the customer level used to classify borrowers as significant have been set at 10 million euros for customers classified in stage 1, and at 3 million euros for customers classified in stage 2 or 3. These thresholds comprise amounts drawn, amounts available and guarantees.

Exposures of more than 1 million euros of borrowers within the top 10 main risk groups classified in stage 3, identified on an annual basis, are also considered individually. Exceptionally, and with the sole purpose of classifying and more precisely impairing transactions, borrowers whose exposures are not above the significance threshold but who nevertheless belong to a group in which the individual assessment of its components is based on consolidated data may also be assessed individually.

To assess significant borrowers' transactions, a system of triggers is established. These triggers identify any significant increase in credit risk, as well as any signs of impairment.

A team of expert risk analysts carries out the individual assessment of borrowers, reviewing each transaction and assigning it the corresponding accounting classification.

The system of triggers for significant borrowers is automated and takes into account the particular characteristics of segments that perform differently within the loan portfolio, with specific triggers in place for certain segments. In any event, the system of triggers does not automatically or individually classify borrowers. Instead, it brings forward the due date for assessment of the borrower by the analyst and prompts decision-making with regard to their classification. The main aspects identified by the system of triggers are listed here below:

Stage 2 triggers:

• Adverse changes in the financial situation, such as a significant increase in levels of leverage or a sharp drop in turnover or equity.
• Adverse changes in the economy or market indicators, such as a significant fall in share prices or a reduction in the price of debt issues.
• Significant fall in the internal credit rating of the borrower.
• Significant increase in credit risk of other transactions of the same borrower, or in entities associated with the borrower's risk group.
• For transactions secured with collateral, significant decline in the value of the collateral received.

Stage 3 triggers:

• A negative value of Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA), or a significant decrease in EBITDA, in turnover, or in general, in the borrower's recurrent cash flows.
• Increase in the borrower's leverage ratios.
• Negative equity or equity reduction as a result of the borrower sustaining equity losses of 50% or more in the past year.
• Existence of an internal or external credit rating showing that the borrower is in arrears.

The Group carries out an annual review of the reasonableness of its thresholds and of the credit risk captured in the individual assessments carried out using those thresholds.

Collective assessment

For borrowers who have been classed below the significance threshold and who, in addition, have not been classified as stage 2 or 3 by the automatic classification rules, there is a process in place to identify transactions that show a significant increase in credit risk compared to when the transaction was approved, and which could give rise to greater losses than those incurred on other similar transactions classified as stage 1.

The Group has a statistical model that applies to all geographies except for the UK (TSB) and which allows it to determine the Probability of Default (PD) term structure and, therefore, the residual lifetime PD of a contract (or the PD from a given moment in time up to the maturity of the transaction), based on different characteristics:

• Systemic: macroeconomic characteristics shared by all exposures.
• Cross-cutting: aspects that remain stable over time and which are shared by a group of transactions, such as the shared effect of lending policies in effect at the time the transaction was approved, or the transaction's approval channel.
• Idiosyncratic: aspects specific to each transaction or borrower.

With this specification, it is possible to measure the annualised residual lifetime PD of a transaction under the conditions that existed at the time the transaction was approved (or originated), or under the conditions existing at the time the provision is calculated. Therefore, the current annualised residual lifetime PD may fluctuate in relation to the PD at the time the transaction was approved, due to changes in the economic environment or in the idiosyncratic characteristics of the transaction or of the borrower.

The Bank uses a statistical model that estimates significant increase in credit risk for borrowers and transactions subject to collective assessment models. The estimate is made using a logistic regression that considers, as explanatory variables, the ratio of the absolute increase between the annualised lifetime PD under the economic and idiosyncratic circumstances at the time the provision is calculated relative to the annualised residual lifetime PD under the circumstances that existed at the time the transaction was approved, along with other defining variables of the borrower or exposure. For this model, thresholds for the increase in annualised lifetime PD, which require classification in stage 2, have been calibrated using historical data with the aim of maximising efficient and early detection of arrears at 30 days, refinancings and stage 3, thereby maximising risk discrimination among borrowers and/or transactions classified as stage 1 and 2.

The thresholds for significant increase in credit risk vary according to the portfolio, company size, product and level of PD upon approval, requiring higher relative increases if the PD upon approval is low.

Exceptionally, those thresholds are not applicable at certain low levels of current PD where there is practically no indication of any significant increase in credit risk over a 6-month horizon (low credit risk exemption); those levels vary according to the portfolio/segment and have been calibrated using historical data. The current PD thresholds to identify the population exempt from significant increases in credit risk have been calibrated differently for each of the portfolios under the collective model perimeter, i.e. companies differentiated by size, mortgages, and consumer loans.

In any case, as a general criterion and in addition to those described previously, borrowers included in the watchlist identified by the risk function (list of high-risk borrowers) and all transactions that have a current 12-month PD above a given threshold that varies according to portfolio/segment and is statistically calibrated, are reclassified to stage 2. Similarly, all transactions with a current 12-month PD above 50% are reclassified to stage 3.

For the portfolios of retail mortgages, consumer loans and business lending items, the average multiplier of the current annualised lifetime PD relative to the annualised residual lifetime PD upon approval, which requires exposures to be reclassified from stage 1 to stage 2 depending on the annualised residual lifetime PD upon approval, varies between the values shown in the following table:

Annualised residual lifetime PD upon approval	Average multiplier
PD<0.5%	14
0.5%<=PD<1%	5
1%<=PD<2%	3
2%<=PD<3%	2.2
PD>3%	1.3

This multiplier will also vary depending on the portfolio to which each exposure is allocated.

In other less material portfolios, the multiplier between the annualised lifetime PD upon approval and the current annualised lifetime PD is used as a metric to identify the increase in credit risk and classify exposures as stage 2. More specifically, any exposures with a multiplier of more than 3 are reclassified to stage 2.

In the case of TSB, the methodology for classification to stage 2 uses the multiplier of lifetime PD upon approval relative to current lifetime PD as an input, complemented with an absolute increase in PD calculated specifically for each portfolio. Both of these thresholds must be reached in order for an exposure to be reclassified to stage 2. In 2024 and 2023, the threshold for the multiplier of current PD relative to PD upon approval ranged from 1.5 to 2, while absolute thresholds ranged from 200 to 950 basis points in both years, with the exception of overdrafts, which only use an absolute threshold of 200 basis points.

Forbearance

The credit risk management policies and procedures applied by the Group ensure that borrowers are carefully monitored, identifying cases where provisions need to be allocated as there is evidence that their solvency is declining (see Note 4.4.2 - Credit risk). To that end, the Group allocates loan loss provisions for the transactions that require them given the borrower's circumstances, before formally executing any refinancing/restructuring transactions, which should be understood as follows:

• Refinancing transaction: transaction which, irrespective of the borrower or guarantees involved, is approved or used for economic or legal reasons related to the current or foreseeable financial difficulties of the borrower (or borrowers) to repay one or more transactions approved by the Group and granted to the borrower (or borrowers) or to another company or companies belonging to its group, or to bring outstanding payments fully or partially up to date, with a view to making it easier for holders of refinanced transactions to repay their debt (principal and interest) when they are unable, or will predictably soon be unable, to honour their payment obligations in good time and in the manner agreed.
• Restructured transaction: transaction in which, for economic or legal reasons related to the current or foreseeable financial difficulties of the borrower (or borrowers), the financial terms and conditions are modified to make it easier for them to repay their debt (principal and interest) when they are unable, or will predictably soon be unable, to honour their payment obligations in good time and in the manner agreed, even when such a modification is already provided for in the contract. In any case, transactions in which the debt is written down or assets are received to reduce the debt, or transactions whose terms are modified to extend the term to maturity, or to amend the repayment schedule so as to the reduce repayment instalment amounts in the short term or reduce their payment frequency, or to establish or extend the grace period for the repayment of principal, interest, or both, are all considered restructured transactions, except where it can be proven that the terms are being modified for reasons other than borrowers' financial difficulties and that the modified terms are analogous to those that would be applied in the market, on the date of such modification, to transactions with a similar risk profile.

If a transaction is classified in a particular risk category, refinancing does not mean that its risk classification will automatically improve. The algorithm establishes the initial classification of refinanced transactions based on their characteristics, mainly, the existence of a borrower's financial difficulties (e.g. an inadequate business plan), the existence of certain clauses such as long grace periods, or the existence of amounts that have been written off as they are considered to be non-recoverable. The algorithm then changes the initial classification depending on the established cure periods. Reclassification into a lower risk category will only be considered if evidence exists of a continuous and significant improvement in the recovery of the debt over time; therefore, the act of refinancing does not in itself produce any immediate improvements.

Refinancing, refinanced and restructured transactions remain identified as such during a probation period until all of the following requirements are met:

• It is concluded, having reviewed the borrower's assets and financial position, that the borrower is unlikely to experience financial difficulties.
• A minimum of two years has elapsed since the date of the restructuring or refinancing or, if later, since the date of reclassification to the stage 3 category.
• The borrower has paid the instalments of principal and interest accrued since the date of the refinancing or restructuring or, if later, since the date of reclassification to the stage 3 category.
• The borrower has no other transactions with amounts more than 30 days past due at the end of the probation period.
• At least 12 months have passed since the grace period came to an end.

– The refinanced amount of both the contract and the borrower has been reduced, through payments made by the customer whose cumulative amount since the refinancing date is at least the amount equivalent to the write-down, the unpaid amount at the time of refinancing or the new risk approved.

Refinancing, refinanced and restructured transactions remain in the stage 3 category until it can be verified that they meet the general criteria for reclassification to the stage 2 category, particularly the following requirements:

• It is concluded, having reviewed the borrower's assets and financial position, that the borrower is unlikely to experience financial difficulties.
• One year has passed since the date of the refinancing or restructuring.
• The borrower has paid the accrued instalments of principal and interest.
• The borrower has no other transactions with amounts more than 90 days past due on the date on which the refinancing, refinanced or restructured transaction is reclassified to stage 2.
• At least 12 months have passed since the grace period came to an end.
• The refinanced amount of both the contract and the borrower has been reduced, through payments made by the customer whose cumulative amount since the refinancing date is at least the amount equivalent to the write-down, the unpaid amount at the time of refinancing or the new risk approved.

In the case of refinanced/restructured loans classified as stage 2, in addition to the general classification criteria, certain specific criteria are applicable which, if met, lead to reclassification into one of the higher risk categories described previously (i.e. to stage 3, as a result of borrower arrears, when payments are, in general, over 90 days past due, or for reasons other than borrower arrears, when there are reasonable doubts as to their recoverability).

1.3.4.1.2 Credit loss allowances

The Group applies the following parameters to determine its credit loss allowances:

– Exposure at Default (EAD): the Institution defines exposure at default as the value to which it expects to be exposed when a loan defaults.

The exposure metrics considered by the Group in order to cover this value are the currently drawn balances and the estimated amounts that it expects to disburse in the event its off-balance sheet exposures enter into default, by applying a Credit Conversion Factor (CCF).

– Probability of Default (PD): estimation of the probability that a borrower will default within a given period of time.

The Group has tools in place to help in its credit risk management that predict the probability of default of each borrower and which cover practically all lending activity.

In this context, the Group reviews the quality and stability of the scoring and rating tools currently in use on an annual basis. The review process includes the definition of the sample used and the methodology to be applied when monitoring rating models (see Note 4.4.2.2 "Risk management models").

• Loss Given Default (LGD): expected loss on transactions which are in default. This loss also takes into account outstanding debt, late-payment interest and expenses relating to the recovery process. Additionally, for each cash flow (amounts outstanding and amounts recovered), an adjustment is applied to consider the time value of money.
• Effective Interest Rate (EIR): the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortised cost of a financial liability.
• Multiple scenarios: in order to estimate expected losses, the Group applies different scenarios to identify the effect of the non-linearity of losses. To that end, the provisions required are estimated in the different scenarios for which a probability of occurrence has been defined (see Note 4.4.2.5 "Calculation of credit loss allowances").

Summary of criteria for classification and allowances

The amount of credit impairment allowances is calculated based on whether or not there has been a significant increase in credit risk since the transaction was originated, and on whether or not any default events have occurred:

Observed credit impairment since initial recognition
Credit risk category	Stage 1	Stage 2	Stage 3	Write-off
Criteria for classification into stages	Transactions in which there has been no significant increase in credit risk since initial recognition and which do not meet the requirements for classification into other categories	Transactions which show a significant increase in credit risk since initial recognition	Transactions whose full recovery is considered doubtful, even if no amounts are more than ninety days past due	Transactions whose possibility of recovery is considered remote due to a manifest and irreversible deterioration of the solvency of the transaction or the borrower
			Transactions with amounts more than 90 days past due
Calculation of allowance	12-month expected credit loss	Lifetime expected credit loss		Write-off from balance sheet and recognition of the loss in the income statement, at the carrying amount of the transaction
Accrual of interest	gross carrying amount of the transaction	Calculated by applying the effective interest rate to the Calculated by applying the effective interest rate to the amortised cost (adjusted to account for any impairment allowances)		Not recognised in the income statement
Transactions included, by stage	Initial recognition	Transactions which show a significant increase in credit risk since initial recognition	Transactions classified as stage 3 as a result of borrower arrears: Amount of debt instruments with one or more amounts more than 90 days past due	Transactions whose possibility of recovery is considered remote
		Refinancing, refinanced and restructured transactions that do not meet the conditions for classification as stage 3	Transactions classified as stage 3 for reasons other than borrower arrears: • Transactions with no amounts more than 90 days past due but whose full recovery is considered doubtful • Refinancing, refinanced and restructured transactions that do not meet the conditions for classification as stage 2 • Purchased or originated credit impaired (POCI) transactions	Transactions partially deemed to be irrecoverable even though debt collection rights have not yet been terminated (write downs)
		Transactions with amounts more than 30 days past due

The methodology used to estimate losses on refinanced and restructured transactions is generally similar to that used for other financial assets at amortised cost, but it is considered that, in principle, the estimated loss on a transaction that has had to be restructured to enable payment obligations to be satisfied should be greater than the estimated loss on a transaction with no history of non-payment, unless sufficient additional effective guarantees are provided to justify otherwise.

Guarantees

Effective guarantees are collateral and personal guarantees proven by the Group to be a valid means of mitigating credit risk.

Under no circumstances will guarantees whose effectiveness substantially depends on the credit quality of the debtor or, where applicable, of the economic group of which the debtor forms part, be accepted as effective guarantees.

Based on the foregoing, the following types of guarantees can be considered to be effective guarantees:

• Real estate guarantees applied as first mortgage liens:
  • Completed buildings and building components:
    • Housing units.
    • Offices, commercial premises and multi-purpose industrial buildings.
    • Other buildings, such as non-multi-purpose industrial buildings and hotels.
  • Urban land and regulated building land.
  • Other real estate.
• Collateral in the form of pledged financial instruments:
  • Cash deposits.
  • Equity instruments in listed entities and debt securities issued by creditworthy issuers.
• Other collateral:
  • Personal property received as collateral.
  • Subsequent mortgages on properties.
• Personal guarantees such that direct liability to the customer falls to the new guarantors, who are persons or entities whose solvency is sufficiently verified to ensure the full redemption of the transaction under the terms set forth.

The Group has collateral valuation criteria for assets located in Spain that are in line with prevailing legislation. In particular, the Group applies criteria for the selection and engagement of appraisers that are geared towards assuring their independence and the quality of the appraisals. All of the appraisers used are appraisal companies that have been entered in the Bank of Spain Special Register of Appraisal Firms, and the appraisals are carried out in accordance with the criteria established in Order ECO/805/2003 on rules for the appraisal of real estate and particular rights for specific financial purposes.

Real estate guarantees for loan transactions are valued on the date they are granted, while real estate assets are valued on the date on which they are recognised, whether as a result of a purchase, foreclosure or deed in lieu, and also whenever there is a significant reduction in value. In addition, the criteria for updating the appraisal, established in Annex 9 to Circular 4/2017 published by the Bank of Spain, are applied for assets subject to the calculation of provisions for impairment risk. Similarly, statistical methodologies may be used to update appraisals but only for properties that have a certain level of homogeneity among them, in other words, those with low exposure and low risk whose characteristics are likely to be shared by other properties and which are located in an active market with frequent transactions, although a full appraisal is carried out in accordance with the aforesaid ECO Order (an "ECO appraisal") at least once every three years.

Assets located in other EU countries are appraised in accordance with that set forth in Royal Decree 716/2009 of 24 April, while those in the rest of the world are appraised by companies and/or experts with recognised expertise and experience in the country in question. Real estate assets located in a foreign country, if any, will be appraised using the method approved by the Royal Institution of Chartered Surveyors (RICS), through prudent and independent appraisals carried out by authorised experts in the country where the property is located or, where appropriate, by appraisal firms or services accredited in Spain, and in accordance with the appraisal rules applicable in that country insofar as these are compatible with generally accepted appraisal practices.

The Group has developed internal methodologies to estimate credit loss allowances. These methodologies use the appraisal value as a starting point to determine the amount that can be recovered with the enforcement of real estate guarantees. This appraisal value is adjusted to account for the time required to enforce such guarantees, price trends and the Group's ability and experience in realising the value of properties with similar prices and enforcement timeframes, as well as the costs of enforcement, maintenance and sale.

Credit losses on State-guaranteed loans granted as part of the government support scheme designed to address the impact of Covid-19, irrespective of the credit risk category or categories into which the transaction is classified throughout its life, are calculated based on their expected credit loss less the positive impact of cash flows expected to be recovered with that guarantee.

1.3.4.2 Investments in joint ventures and associates

The Group recognises allowances for the impairment of investments in joint ventures and associates, always provided there is objective evidence that the carrying amount of an investment is not recoverable. Objective evidence that equity instruments have become impaired is considered to exist when, after initial recognition, one or more events occur whose direct or combined effect demonstrates that the carrying amount is not recoverable.

The Group considers the following indicators, among others, to determine whether there is evidence of impairment:

• Significant financial difficulties.
• Disappearance of an active market for the instrument in question because of financial difficulties.
• Significant changes in performance compared with budgets, business plans or milestones.
• Significant changes in the market for the issuer's equity or its products or potential products.
• Significant changes in the global economy or in the economic environment in which the issuer operates.
• Significant changes in the technological or legal environment in which the issuer operates.

The value of allowances for the impairment of interests held in associates included under the heading of "Investments in joint ventures and associates" is estimated by comparing their recoverable amount against their carrying amount. The latter amount is the higher of the fair value, less costs of disposal, and the value in use.

The Group determines the value in use of each interest held based on its net asset value, or based on estimates of the companies' profit or loss, pooling them into activity sectors (real estate, renewables, industrial, financial, etc.) and evaluating the macroeconomic factors specific to that sector which could affect the performance of those companies. In particular, interests held in insurance investees are valued by applying the market consistent embedded value methodology, those held in companies involved in real estate are valued based on their net asset value, while those held in financial investees are valued using multiples of their carrying amount and/or the profit of other comparable listed companies.

Impairment losses are recognised in the consolidated income statement for the year in which they materialise and subsequent recoveries are recognised in the consolidated income statement for the year in which they are recovered.

1.3.5 Hedging transactions

The Group has elected to continue applying IAS 39 for its hedge accounting until the IFRS 9 macro hedge accounting project has been finalised, as permitted by IFRS 9.

The Group uses financial derivatives to (i) provide these instruments to customers that request them, (ii) manage risks associated with the Group's proprietary positions (hedging derivatives), and (iii) realise gains as a result of their price fluctuations. To that end, it uses both financial derivatives traded in organised markets and those traded bilaterally with counterparties outside organised markets (Over The Counter, or OTC).

Financial derivatives that do not qualify for designation as hedging instruments are classified as derivatives held for trading. To be designated as a hedging instrument, a financial derivative must meet the following conditions:

• The financial derivative must hedge against the exposure to changes in the value of assets and liabilities caused by interest rate and/or exchange rate fluctuations (fair value hedge), the exposure to variability in estimated cash flows that is attributable to a particular risk of financial assets and financial liabilities, firm commitments or highly probable forecast transactions (cash flow hedge), or the exposure associated with net investments in foreign operations (hedge of net investments in foreign operations).
• The financial derivative must effectively eliminate some portion of the risk inherent in the hedged item or position throughout the entire expected life of the hedge. This effectiveness should be measured both prospectively and retrospectively. To that end, the Group analyses whether, at the time of its inception, a hedge is expected to operate with a high level of effectiveness in businessas-usual conditions. It also runs effectiveness tests throughout the life of the hedge, in order to verify that the results of these tests show an effectiveness that falls within a range of between 80% and 125%.
• Suitable documentation must be available to show that the financial derivative was acquired specifically to hedge against certain balances or transactions and to show the intended method for achieving and measuring hedge effectiveness, provided that this method is consistent with the Group's own risk management processes.

Hedges are applied to either individual items and balances (micro-hedges) or to portfolios of financial assets and financial liabilities (macro-hedges). In the latter case, the set of financial assets and financial liabilities to be hedged must share the same type of risk, a condition that is met when the individual hedged items have a similar interest rate sensitivity.

Changes that take place after the designation of the hedge, changes in the measurement of financial instruments designated as hedged items and changes in financial instruments designated as hedging instruments are recognised in the following way:

– In fair value hedges, differences arising in the fair value of the derivative and the hedged item that are attributable to the hedged risk are recognised directly in the consolidated income statement, with a balancing entry under the headings of the consolidated balance sheet in which the hedged item is included, or under the heading "Derivatives – Hedge accounting", as appropriate.

In fair value hedges of interest rate risk of a portfolio of financial instruments, gains or losses arising when the hedging instrument is measured are recognised directly in the consolidated income statement. Losses and gains arising from fair value changes in the hedged item that can be attributed to the hedged risk are recognised in the consolidated income statement with a balancing entry under the heading "Fair value changes of the hedged items in portfolio hedge of interest rate risk" on either the asset side or the liability side of the consolidated balance sheet, as appropriate. In this case, hedge effectiveness is assessed by comparing the net position of assets and liabilities in each time period against the hedged amount designated for each of them, immediately recognising the ineffective portion under the heading "Net profit or net loss on financial operations" of the consolidated income statement.

– In cash flow hedges, differences in the value of the effective portion of hedging instruments are recognised under the heading "Accumulated other comprehensive income – Hedging derivatives. Cash flow hedges reserve [effective portion]" of the consolidated statement of equity. These differences are recognised in the consolidated income statement when the losses or gains on the hedged item are recognised through profit or loss, when the envisaged transactions are executed, or on the maturity date of the hedged item.

• – In hedges of net investments in foreign operations, measurement differences in the effective portion of hedging instruments are recognised temporarily in the consolidated statement of equity under "Accumulated other comprehensive income – Hedge of net investments in foreign operations [effective portion]". These differences are recognised in the consolidated income statement when the investment in foreign operations is disposed of or derecognised from the consolidated balance sheet.
• Measurement differences in hedging instruments corresponding to the ineffective portion of cash flow hedges and net investments in foreign operations are recognised under the heading "Net profit or net loss on financial operations" of the consolidated income statement.

If a derivative assigned as a hedging derivative does not meet the above requirements due to its termination, discontinuance, ineffectiveness, or for any other reason, it will be treated as a derivative held for trading for accounting purposes. Therefore, changes in its measurement are recognised with a balancing entry in the income statement.

Where a fair value hedge is discontinued, any previous adjustments made to the hedged item are recognised in the income statement using the effective interest rate method, recalculated as at the date on which the item ceased to be hedged, and must be fully amortised upon maturity.

Where a cash flow hedge is discontinued, the accumulated gains or losses on the hedging instrument that had been recognised under "Accumulated other comprehensive income" in the consolidated statement of equity while the hedge was still effective will continue to be recognised under that heading until the hedged transaction takes place, at which time the gain or loss will be recognised in the income statement, unless the hedged transaction is not expected to take place, in which case it will be recognised in the income statement immediately.

1.3.6 Financial guarantees

Contracts whereby the issuer undertakes to make specific payments on behalf of a third party in the event of that third party failing to do so, irrespective of their legal form, are considered financial guarantees. These can be bonds, bank guarantees, insurance contracts or credit derivatives, among other items.

The Group recognises financial guarantee contracts under the heading "Financial liabilities at amortised cost – Other financial liabilities" at their fair value which, initially and unless there is evidence to the contrary, is the present value of the expected fees and income to be received. Fees and similar income received upon commencement of the operations, as well as receivables measured at the present value of future cash flows pending collection, are simultaneously recognised as a credit item on the asset side of the balance sheet.

In the particular case of long-term guarantees given in cash to third parties under service contracts, where the Group guarantees a particular level or volume in terms of the provision of such services, it initially recognises those guarantees at fair value. The difference between their fair value and the disbursed amount is considered an advance payment made or received in exchange for the provision of the service, and this is recognised in the consolidated income statement for the period in which the service is provided. Subsequently, the Group applies analogous criteria to debt instruments measured at amortised cost.

Financial guarantees are classified according to the risk of incurring loan losses attributable to either the customer or the transaction and, where appropriate, an assessment is made of whether provisions need to be allocated for these guarantees by applying criteria similar to the criteria used for debt instruments measured at amortised cost.

Income from guarantee instruments is recognised under the heading "Fee and commission income" in the consolidated income statement and calculated applying the rate laid down in the related contract to the nominal amount of the guarantee. Interest from long-term guarantees given in cash to third parties is recognised by the Group under the heading "Interest income" in the consolidated income statement.

1.3.7 Transfers and derecognition of financial instruments from the balance sheet

Financial assets are only derecognised from the consolidated balance sheet when they no longer generate cash flows or when their inherent risks and rewards have been substantially transferred to third parties. Similarly, financial liabilities are only derecognised from the consolidated balance sheet when there are no further obligations associated with the liabilities or when they are acquired for the purpose of their termination or resale.

Note 4 provides details of asset transfers in effect at the end of 2024 and 2023, indicating those that did not involve the derecognition of the asset from the consolidated balance sheet.

1.3.8 Offsetting of financial instruments

Financial assets and financial liabilities are only offset for the purpose of their presentation in the consolidated balance sheet when the Group has a legally enforceable right to offset the amounts recognised in such instruments and intends to settle them at their net value or realise the asset and settle the liability simultaneously.

1.3.9 Non-current assets and assets and liabilities included in disposal groups classified as held for sale and discontinued operations

The "Non-current assets and disposal groups classified as held for sale" heading on the consolidated balance sheet includes the carrying amounts of assets – stated individually or combined in a disposal group, or as part of a business unit intended to be sold (discontinued operations) – which are very likely to be sold in their current condition within one year of the date of the consolidated annual financial statements.

It can therefore be assumed that the carrying amount of these assets, which may be of a financial or nonfinancial nature, will be recovered through the disposal of the item concerned rather than through its continued use.

Specifically, real estate or other non-current assets received by the Group for the full or partial settlement of debtors' payment obligations are treated as non-current assets held for sale, unless the Group has decided to make continued use of those assets or to include them in its rental operations. Similarly, investments in joint ventures or associates that meet the above criteria are also recognised as non-current assets held for sale. For all of these assets, the Group has specific units that focus on the management and sale of real estate assets.

The heading "Liabilities included in disposal groups classified as held for sale" includes credit balances associated with assets or disposal groups, or with the Group's discontinued operations.

Non-current assets and disposal groups classified as held for sale are measured, both on the acquisition date and thereafter, at the lower of their carrying amount and their fair value less estimated selling costs. The carrying amount at the acquisition date of non-current assets and disposal groups classified as held for sale deriving from foreclosure or recovery is defined as the outstanding balance of the loans or credit that gave rise to those purchases (less any associated provisions). Tangible and intangible assets that would otherwise be subject to depreciation or amortisation are not depreciated or amortised while they remain classified as "Non-current assets and disposal groups classified as held for sale".

In order to determine the net fair value of real estate assets, the Group uses its own internal methodology, which uses as a starting point the appraisal value, adjusting this based on its past experience of selling properties that are similar in terms of prices, the period during which each asset remains on the consolidated balance sheet and other explanatory factors. Similarly, agreements entered into with third parties for the disposal of these assets are also taken into account.

The appraisal value of real estate assets recognised in this heading is obtained following policies and criteria analogous to those described in the section entitled "Guarantees" in Note 1.3.4. The main appraisal firms and agencies used to obtain market appraisal values are listed in Note 6.

Profit or loss generated on the disposal of assets and liabilities classified non-current assets or liabilities held for sale, as well as impairment losses and their reversal, where appropriate, are recognised under the heading "Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations" in the consolidated income statement. The remaining income and expenses relating to these assets and liabilities are disclosed according to their nature.

Discontinued operations are components of the Institution that have been disposed of or classified as held for sale and which (i) represent a business line or geographical area that is significant and separate from the rest or is part of a single coordinated plan to dispose of that business or geographical area, or (ii) are subsidiaries acquired solely in order to be resold. Income and expenses of any kind generated by discontinued operations, if any, during the year, including those generated before they were classified as discontinued operations, are presented net of the tax effect as a single amount under the heading "Profit or (-) loss after tax from discontinued operations" in the consolidated income statement, regardless of whether the business has been derecognised from or remains on the asset side of the balance sheet as at year-end. This heading also includes the profit or loss obtained on their sale or disposal.

1.3.10 Tangible assets

Tangible assets include (i) property, plant and equipment held by the Group for current or future use that is expected to be used for more than one year, (ii) property, plant and equipment leased out to customers under operating leases, and (iii) investment properties, which include land, buildings and other structures held in order to be leased out or to obtain a capital gain on their sale. This heading also includes tangible assets received in payment of debts classified on the basis of their final use.

As a general rule, tangible assets are measured at their acquisition cost less accumulated depreciation and, if applicable, less any impairment losses identified by comparing the net carrying amount of each item against its recoverable amount.

Depreciation of tangible assets is systematically calculated on a straight-line basis, applying the estimated years of useful life of the various items to the acquisition cost of the assets less their residual value. The land on which buildings and other structures stand is considered to have an indefinite life and is therefore not depreciated.

The annual depreciation charge on tangible assets is recognised in the consolidated income statement and generally calculated based on the remaining years of the estimated useful life of the different groups of components:

	Useful life (years)
Land and buildings	17 to 75
Fixtures and fittings	5 to 20
Furniture, office equipment and other	3 to 15
Vehicles	3 to 6
Computer equipment	4 to 6

The Group reviews the estimated useful life of the various components of tangible assets at the end of every year, if not more frequently, in order to detect any significant changes. Should any such changes occur, the useful life is adjusted, correcting the depreciation charge in the consolidated income statements for future years as required to reflect the new estimated useful life.

At each year-end closing, the Group analyses whether there are any internal or external signs that a tangible asset might be impaired. If there is evidence of impairment, the Group assesses whether this impairment actually exists by comparing the asset's net carrying amount against its recoverable amount (the higher of its fair value, less selling costs, and its value in use). Where the asset's carrying amount is higher than its recoverable amount, the Group reduces the carrying amount of the corresponding component to its recoverable amount and adjusts future depreciation charges in proportion to the adjusted carrying amount and new remaining useful life, in the event this needs to be re-estimated. Where there are signs that the value of a component has been recovered, the Group records the reversal of the impairment loss recognised in previous years and adjusts future depreciation charges accordingly. The reversal of an impairment loss on an asset component shall in no circumstances result in its carrying amount being increased to a value higher than the value that the asset component would have had if no impairment losses had been recognised in previous years.

In particular, certain items of property, plant and equipment are assigned to cash-generating units in the banking business. Impairment tests are conducted on these units to verify whether sufficient cash flows are generated to support the assets' value. To that end, the Group (i) calculates the recurring net cash flow of each branch based on the cumulative contribution margin less the allocated recurring cost of risk, and (ii) that recurring net cash flow is regarded as a perpetual cash flow and a valuation is effected using the discounted cash flow method applying the cost of capital and growth rate in perpetuity determined by the Group (see Note 16).

For investment properties, the Group uses valuations carried out by third parties entered in the Bank of Spain Special Register of Appraisal Firms, in accordance with criteria set forth in Order ECO/805/2003.

The costs of preserving and maintaining tangible assets are recognised in the consolidated income statement for the year in which they are incurred.

1.3.11 Leases

The Group evaluates the existence of a lease contract at its inception or when its terms are changed. A contract is deemed to be a lease contract when the asset is identified in that contract and the party receiving the asset has the right to control its use.

Leases in which the Group acts as lessee

The Group recognises, for leases in which it acts as lessee, which mostly correspond to lease contracts for real estate and office spaces linked to its operating activity, a right-of-use asset of the leased asset and a liability for payments outstanding at the date on which the leased asset was made available to the Group for use.

For lease contracts with a specified lease term that include, or not, a unilateral option for early termination that can be exercised by the Group and in which the cost associated with such termination is not significant, the term of the lease is generally equivalent to the duration initially stipulated in the contract. However, if there are any circumstances that could result in contracts being terminated early, these will be taken into account.

For lease contracts with a specified lease term that include a unilateral option for extension that can be exercised by the Group, the choice to exercise that option will be made on the basis of economic incentives and past experience.

The lease liability is initially recognised in the heading "Financial liabilities at amortised cost – Other financial liabilities" of the consolidated balance sheet (see Note 21), at a value equal to the present value of the estimated payments outstanding, based on the envisaged maturity date. Lease payments are discounted using the implicit interest rate, if this can be easily determined and, if not, the incremental borrowing rate, understood as the rate of interest that the Group would have to pay to borrow the funds necessary to purchase assets with a value similar to the rights of use acquired over the leased assets for a term equal to the estimated duration of the lease contracts.

These payments comprise fixed payments (less any lease incentives receivable), variable payments determined by reference to an index or rate, amounts expected to be paid for residual value guarantees given to the lessor, the exercise price of a purchase option (if the Group is reasonably certain to exercise that option) and payments of penalties for terminating the lease (if the lease term shows that an option to terminate the lease is exercised).

The payments settled by the lessee in each period reduce the lease liability and accrue an interest expense that is recognised in the consolidated income statement over the lease term.

A right-of-use asset, which is classified as a fixed asset based on the nature of the leased asset, is initially recognised at cost, which comprises the amount of the initial measurement of the lease liability, payments made before or on the commencement date of the lease, initial direct costs and, where appropriate, the estimated costs of dismantling or restoring the asset to the condition required under the lease.

The right-of-use asset is depreciated on a straight-line basis at the shorter of the useful life of the asset or the lease term.

The criteria for impairing these assets are similar to those used for tangible assets (see Note 1.3.10).

The Group exercises the option to recognise, as an expense during the year, the payments made on shortterm leases (those that, at the commencement date, have a lease term of 12 months or less) and leases in which the leased asset has a low value.

Sale and leaseback

If the Group does not retain control over the asset, (i) the asset sold is derecognised from the balance sheet and the right-of-use asset arising from the leaseback is recognised at the proportion of the leased asset's previous carrying amount that relates to the right of use retained, and (ii) a lease liability is recognised.

If the Group retains control over the asset, (i) the asset sold is not derecognised from the balance sheet and (ii) a financial liability is recognised for the amount of consideration received.

The profit or loss generated on the transaction is immediately recognised in the consolidated income statement, if a sale is determined to exist (only for the amount of the gain or loss relating to the rights over the transferred asset), as the buyer-lessor has acquired control over the asset.

Leases in which the Group acts as lessor

Finance leases

Where the Group is the lessor of an asset, the sum of the present values of amounts receivable from the lessee is recorded as financing provided to a third party and is therefore included under the heading "Financial assets at amortised cost" on the consolidated balance sheet. This financing includes the exercise price of the purchase option payable to the lessee upon termination of the contract in cases where that exercise price is sufficiently lower than the fair value of the asset at the maturity date of the option, such that it is reasonably likely to be exercised.

Operating leases

In operating leases, ownership of the leased asset and a substantial proportion of all of the risks and rewards incidental to ownership of the asset remain with the lessor.

The acquisition cost of the leased asset is recognised under the heading "Tangible assets". These assets are depreciated in accordance with the same policies followed for similar tangible assets for own use and the revenue from the lease contracts is recognised in the consolidated income statement on a straight-line basis.

1.3.12 Intangible assets

Intangible assets are identifiable, non-monetary assets without physical substance that arise as a result of an acquisition from third parties or which are generated internally by the Group. An intangible asset will be recognised when, in addition to meeting this definition, the Group considers it likely that economic benefits deriving from the asset and its cost can be reliably estimated.

Intangible assets are initially recognised at their acquisition or production cost and are subsequently measured at cost less, where applicable, the accumulated amortisation and any impairment loss that may have been sustained.

Goodwill

Positive differences between the cost of a business combination and the acquired portion of the net fair value of the assets, liabilities and contingent liabilities of the acquired entities are recognised as goodwill on the asset side of the consolidated balance sheet. These differences represent an advance payment made by the Group of the future economic benefits derived from the acquired entities that are not individually identified and separately recognised. Goodwill, which is not amortised, is only recognised when acquired for valuable consideration in a business combination.

Each goodwill item is assigned to one or more Cash-Generating Units (CGUs) that are expected to benefit from the synergies arising from the business combinations. These CGUs are the smallest identifiable group of assets which, as a result of their continuous operation, generate cash flows for the Group, separately from other assets or groups of assets.

CGUs, or groups of CGUs, to which goodwill has been assigned are tested at least once a year for impairment, or whenever there is evidence that impairment might have occurred. To that end, the Group calculates their value in use using mainly the distributed profit discount method, in which the following parameters are taken into account:

• Key business assumptions: these assumptions are used as a basis for the cash flow projections considered in the valuation. For businesses engaging in financial activities, projections are made for variables such as changes in lending volumes, default rates, customer deposits, interest rates under a forecast macroeconomic scenario, and capital requirements.
• Estimates of macroeconomic variables and other financial parameters.
• Projection period: this is usually five years, after which a recurring level is attained in terms of both income and profitability. These projections take into account the existing economic situation at the time of the valuation.
• Discount rate (post-tax): the present value of future dividends, from which a value in use is obtained, is calculated using the Institution's cost of capital (Ke), from the standpoint of a market participant, as a discount rate. To determine the cost of capital, the Capital Asset Pricing Model (CAPM) is used in accordance with the formula: "Ke = Rf + β (Pm) + α", where: Ke = Required return or cost of capital, Rf = Risk-free rate, β = Company's systemic risk coefficient, Pm = Market premium and α = Non-systemic risk premium.

– Growth rate used to extrapolate cash flow projections beyond the period covered by the most recent forecasts: this is based on long-term estimates of the main macroeconomic figures and key business variables, and bearing in mind the existing financial market circumstances and outlooks at all times.

If the carrying amount of a CGU (or group of CGUs to which goodwill has been assigned) is higher than its recoverable amount, the Group recognises an impairment loss that is allocated, firstly, by reducing the goodwill attributed to that CGU and, secondly, if any losses remain to be allocated, by reducing the carrying amount of the remaining allocated assets on a pro rata basis. Impairment losses recognised for goodwill cannot subsequently be reversed.

Other intangible assets

This heading mainly includes intangible assets acquired in business combinations, such as the value of brands of the acquired businesses, as well as computer software.

These intangible assets have a finite useful life and are amortised based on their useful lives, applying similar criteria to those used for tangible assets. The useful life of brands and contractual rights arising from relationships with customers of the acquired businesses varies between 10 and 15 years, while for computer software the useful life ranges from 7 to 15 years. In particular, the software applications corresponding to infrastructure, communications, architecture and corporate functions of the banking platforms used by Group entities to carry out their activity generally have a useful life of between 10 and 15 years, while the useful life of applications corresponding to channels and to data & analytics ranges from 7 to 10 years. The base platform implemented in 2018 that TSB uses to carry out its activity has a useful life of 15 years.

The criteria for recognising impairment losses on these assets and any reversals of impairment losses recognised in earlier financial years are similar to those applied to tangible assets. To that end, the Group determines whether there is evidence of impairment by comparing actual changes against the initial assumptions applied in the parameters used when they were first recognised. These include possible loss of customers, average customer balances, average revenue and the assigned cost-to-income ratio.

Changes in the estimated useful life of intangible assets are treated in a similar way to changes in the estimated useful life of tangible assets.

1.3.13 Inventories

Inventories are non-financial assets that are held by the Group for their use or sale in the ordinary course of its business, or which are in the process of production, construction or development for such sale or use, or which are to be consumed in the production process or in the rendering of services.

As a general rule, inventories are measured at the lower of cost and net realisable value. Net realisable value means the estimated selling price net of the estimated production and marketing costs to carry out the sale.

Decreases in net realisable value and, where applicable, any subsequent recoveries in value are recognised under the heading "Impairment or (-) reversal of impairment on non-financial assets – Other" of the consolidated income statement for the year in which they materialise.

Inventories correspond to land and buildings and their net realisable value is calculated based on the appraisal carried out by an independent expert, entered in the Bank of Spain Special Register of Appraisal Firms and performed in accordance with the criteria established in Order ECO/805/2003 on rules for the appraisal of real estate and particular rights for specific financial purposes, which is then adjusted taking into account past experience in selling assets that are similar in terms of prices, the period during which each asset remains on the consolidated balance sheet and other explanatory factors. Nevertheless, statistical methodologies may be used to update appraisals for properties with a fair value of no more than 300,000 euros and which have a certain level of homogeneity among them, in other words, those with low exposure and low risk whose characteristics are likely to be shared by other properties and which are located in an active market with frequent transactions, although a full appraisal is carried out in accordance with the aforesaid ECO Order (an "ECO appraisal") at least once every three years.

The carrying amount of the inventories is derecognised from the consolidated balance sheet and recognised as an expense during the year in which the income from its sale is recognised.

1.3.14 Own equity instruments

Own equity instruments are defined as equity instruments that meet the following conditions:

• They do not involve any contractual obligation for the issuer that entails delivering cash or another financial asset to a third party, or exchanging financial assets or financial liabilities with a third party under terms that are potentially unfavourable to the issuer.
• In the case of a contract that will or may be settled with the issuer's own equity instruments: if it is a non-derivative financial instrument, it does not entail an obligation to deliver a variable number of its own equity instruments; or, if it is a derivative instrument, it is settled by the exchange of a fixed amount of cash or another financial asset for a fixed number of the issuer's own equity instruments.

All transactions involving own equity instruments, including their issuance or redemption, are recognised directly with a balancing entry in consolidated equity.

Changes in the value of instruments classified as own equity instruments are not recognised in the financial statements. Any consideration received or paid in exchange for such instruments is directly added to or deducted from consolidated equity net of the associated transaction costs.

Equity instruments issued in full or partial settlement of a financial liability are initially recognised at fair value unless this cannot be reliably determined. In this case, the difference between the carrying amount of the financial liability (or any part thereof) that has been settled and the fair value of the equity instruments issued is recognised in the income statement for the year.

On the other hand, compound financial instruments, which are contracts that have both a financial liability and an own equity instrument from the issuer's perspective (e.g. convertible bonds that grant their holder the right to convert them into equity instruments of the issuing entity), are recognised at issuance, separating their component parts and presenting them according to their substance (see Note 1.3.3).

1.3.15 Remuneration in equity instruments

The delivery of own equity instruments to employees in payment for their services (where these instruments are determined at the start of, and delivered upon completion of, a specified period of service) is recognised as a service cost over the period during which the services are being provided, with a balancing entry under the heading "Other equity" in the consolidated statement of equity. On the date these instruments are awarded, the services received are measured at fair value unless this cannot be reliably estimated, in which case they are measured by reference to the fair value of the committed equity instruments, bearing in mind the tenors and other conditions envisaged in the commitments.

The amounts recognised in consolidated equity cannot subsequently be reversed, even when employees do not exercise their right to receive the equity instruments.

For transactions involving share-based remuneration paid in cash, the Group recognises a service cost over the period during which the services are provided by the employees, with a balancing entry on the liabilities side of the consolidated balance sheet. The Group measures this liability at fair value until it is settled. Changes in value are recognised in the income statement for the year.

1.3.16 Provisions, contingent assets and contingent liabilities

Provisions are present obligations of the Group resulting from past events and whose nature as at the date of the financial statements is clearly specified, but which are of uncertain timing and value. When such obligations mature or become due for settlement, the Group expects to settle them with an expenditure.

In general, the Group's consolidated annual financial statements include all significant provisions based on which it is estimated that it is more likely than not that the obligation will need to be settled. These provisions include, among other items, pension commitments undertaken with employees by Group entities (see Note 1.3.17), as well as provisions for tax litigation and other contingencies.

Contingent liabilities are any possible obligations in the Group that arise from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more future events not wholly within the control of the Group. Contingent liabilities include present obligations of the Group whose settlement is unlikely to originate any reduction of funds, or whose value, in extremely rare cases, cannot be reliably measured. Contingent liabilities are not recognised in the consolidated annual financial statements, rather, they are disclosed in the notes to the consolidated annual financial statements.

Contingent assets are possible assets that arise from past events and whose existence will be confirmed only by the occurrence or non-occurrence of events not wholly within the control of the Group. These contingent assets are not recognised on the consolidated balance sheet or in the consolidated income statement, but they are disclosed in the accompanying notes to those statements where an inflow of economic benefits is probable.

1.3.17 Provisions for pensions

The Group's pension commitments to its employees are as follows:

Defined contribution plans

These are plans under which fixed contributions are made to a separate entity in accordance with the agreements entered into with each particular group of employees, without any legal or constructive obligation to make further contributions if the separate entity is unable to pay all employee benefits relating to employee service in the current and prior periods.

These contributions are recognised each year in the consolidated income statement (see Note 33).

Defined benefit plans

Defined benefit plans cover all existing commitments arising from the application of the Collective Bargaining Agreement for Banks (Convenio Colectivo de Banca).

These commitments are financed through the following vehicles: the Banco Sabadell employee pension plan, insurance contracts, the voluntary social welfare agency (E.P.S.V.) and internal funds.

The "Provisions – Pensions and other post employment defined benefit obligations" heading on the liabilities side of the consolidated balance sheet includes the actuarial present value of pension commitments, which is calculated individually using the projected unit credit method on the basis of the financial and actuarial assumptions set out below. This is the same method used for the sensitivity analysis described in Note 22.

The fair value of the plan assets is deducted from the obligations calculated in this way. Plan assets are assets that will be used to settle obligations, including insurance policies, since they meet the following conditions: (i) they are not owned by the Group but by a legally separate third party not qualifying as a related party, (ii) they are only available to pay or fund employee benefits and are not available to creditors of the Group, even in the event of insolvency, (iii) they cannot be returned to the Group unless the assets remaining in the plan are sufficient to settle all obligations, either of the plan or of the Institution, relating to employee benefits, or unless assets are to be returned to the Bank to reimburse it for employee benefits previously paid, and (iv) they are not non-transferable financial instruments issued by the Group.

The assets that back pension commitments shown in the standalone balance sheet of the insurance company BanSabadell Vida, S.A. de Seguros y Reaseguros, also called reimbursement rights or pensionlinked insurance contracts, are not plan assets, as the company is a related party of the Group (see Note 17).

Pension commitments are recognised in the following way:

• In the consolidated income statement, net interest on the defined benefit liability (asset) net of pension commitments as well as the service cost, which includes (i) the service cost in the current period, (ii) the past service cost arising from changes made to existing commitments or from the introduction of new benefits, and (iii) any gain or loss arising from a settlement of the plan.
• Under the heading "Accumulated other comprehensive income Items that will not be reclassified to profit or loss - Actuarial gains or (-) losses on defined benefit pension plans" in the consolidated statement of equity, the remeasurement of the net defined benefit liability (asset) for pension commitments, which includes (i) actuarial gains and losses generated in the year arising from differences between the previous actuarial assumptions and the reality, and from changes in the actuarial assumptions made, and (ii) the return on plan assets. The amounts included in net interest on the defined benefit liability (asset) are not included in either case.
• The heading "Provisions Other long term employee benefits" on the liabilities side of the consolidated balance sheet mainly includes the value of commitments undertaken with early retirees. Changes occurring during the year in the value of liabilities are recognised in the consolidated income statement.

Actuarial assumptions

The most relevant financial/actuarial assumptions used in the measurement of pension commitments as at 31 December 2024 and 2023 are as follows:

	2024	2023
Mortality tables	PER2020_Col_1er.orden	PER2020_Col_1er.orden
Discount rate, pension plan	3.00% per annum	3.75% per annum
Discount rate, related insurance	3.00% per annum	3.75% per annum
Discount rate, non-related insurance	3.00% per annum	3.75% per annum
Inflation	2.00% per annum	2.00% per annum
Rate of increase in salaries	3.00% per annum	3.00% per annum
Employee disability	SS90-Absolute	SS90-Absolute
Employee turnover	Not considered	Not considered
Early retirement	Considered	Considered
Normal retirement age	65 or 67 years	65 or 67 years

In 2024, the discount rate on all commitments was determined by reference to the return on AA-rated corporate bonds (iBoxx € Corporates AA 7-10), with an average duration of 7.58 years (in 2023, the iBoxx € Corporates AA 10+ curve was used, with an average duration of 11.96 years).

The early retirement age considered is the earliest retirement date after which pension entitlements cannot be revoked by the employer for 100% of the employees.

The return on long-term assets corresponding to plan assets and reimbursement rights (pension-linked insurance contracts) was determined by applying the same discount rate used in actuarial assumptions (3.00% and 3.75% in 2024 and 2023, respectively).

1.3.18 Foreign currency transactions and exchange differences

The Group's functional and reporting currency is the euro. Consequently, all balances and transactions denominated in currencies other than the euro are treated as being denominated in a foreign currency.

On initial recognition, debit and credit balances denominated in foreign currencies are translated to the functional currency at the spot exchange rate, defined as the exchange rate for immediate delivery, on the recognition date. Subsequent to the initial recognition, the following rules are used to translate foreign currency balances to the functional currency of each investee:

• Monetary assets and liabilities are translated at the closing rate, defined as the average spot exchange rate as at the reporting date.
• Non-monetary items measured at historical cost are translated at the exchange rate ruling at the acquisition date.
• Non-monetary items measured at fair value are translated at the exchange rate ruling at the date when the fair value was determined.
• Income and expenses are translated at the exchange rate ruling at the transaction date.

In general, exchange differences arising in the translation of debit and credit balances denominated in foreign currency are recognised in the consolidated income statement. However, for exchange differences arising in non-monetary items measured at fair value where the fair value adjustment is recognised under the heading "Accumulated other comprehensive income" in the consolidated statement of equity, a breakdown is given for the exchange rate component of the remeasurement of the non-monetary item.

The balances of the financial statements of consolidated entities with a functional currency other than the euro are translated into euros in the following manner:

• Assets and liabilities are translated at the exchange rate ruling at each year-end closing.
• Income and expenses are translated at the average exchange rate, weighted by the volume of transactions of the company whose income and expenses are being translated.
• Equity is translated at historical exchange rates.

Exchange differences arising in the translation of financial statements of consolidated entities with a functional currency other than the euro are recognised under the heading "Accumulated other comprehensive income" on the consolidated statement of equity.

The exchange rates applied to translate balances denominated in foreign currency into euros are those published by the European Central Bank on 31 December of each year.

1.3.19 Recognition of income and expenses

Interest income and expenses and other similar items

Interest income and expenses and other similar items are generally accounted for over the period in which they accrue using the effective interest rate method, under the headings "Interest income" or "Interest expenses" of the consolidated income statement, as applicable. Dividends received from other entities are recognised as income at the time the right to receive them originates.

Commissions, fees and similar items

Generally, income and expenses in the form of commissions and similar fees are recognised in the consolidated income statement based on the following criteria:

• Those linked to financial assets and financial liabilities measured at fair value through profit or loss are recognised at the time of disbursement.
• Those related to transactions carried out or services rendered over a given period of time are recognised throughout that period.
• Those related to a transaction or service that is carried out or rendered in a single act are recognised when the originating act takes place.

Financial fees and commissions, which form an integral part of the effective cost or yield of a financial transaction, are accrued net of associated direct costs and recognised in the consolidated income statement over their expected average life.

Assets managed by the Group but owned by third parties are not included in the balance sheet. Fees generated by this activity are recognised under the heading "Fee and commission income" in the consolidated income statement.

Non-financial income and expenses

These items are recognised in the accounts upon delivery of the non-financial asset or upon provision of the non-financial service. To determine the carrying amount and establish when this item should be recognised, a model is used that consists of five steps: identification of the contract with the customer, identification of the separate obligations of the contract, calculation of the transaction price, distribution of the transaction price between the identified obligations and, lastly, recognition of the revenue when, or as, the obligations are settled.

Deferred payments and collections

Deferred payments and collections are accounted for at the carrying amount obtained by discounting expected cash flows at market rates.

Levies

For levies and tax obligations whose amount and date of payment are certain, the obligation is recognised when the event that leads to its payment takes place in the terms provided in legislation. Therefore, the item to be paid is recognised when there is a present obligation to pay the levy.

Deposit guarantee schemes

The Bank is a member of the Deposit Guarantee Fund (hereinafter, DGF). The Management Committee of the DGF of credit institutions, in accordance with that established in Royal Decree-Law 16/2011 and Royal Decree 2606/1996, set the annual contribution for the year 2024 in the following terms: (i) no annual contribution needs to be made for the deposit guarantee offered by the Fund, as the financial resources available in that guarantee as at 31 December 2023 already represented 0.8% of the amount of the guaranteed deposits, and (ii) the contribution to the securities guarantee offered by the Fund has been set at 0.2% of 5% of the value of the securities guaranteed as at 31 December 2024 (see Note 32).

Some of the consolidated entities are integrated into schemes which are similar to the DGF and they make contributions to those schemes in accordance with domestic regulations (see Note 32). The most significant of these are listed below:

• TSB Bank plc makes contributions to the Financial Services Compensation Scheme.
• Banco Sabadell, S.A. Institución de Banca Múltiple makes contributions to the deposit guarantee scheme established by the Instituto para la Protección del Ahorro Bancario.

Single Resolution Fund (SRF)

Law 11/2015 of 18 June, together with its implementing regulation through Royal Decree 1012/2015, entailed the transposition into Spanish law of Directive 2014/59/EU. This Directive established a new framework for the resolution of credit institutions and investment firms, and it is also one of the standards that have contributed to the establishment of the Single Resolution Mechanism, created through Regulation (EU) No 806/2014. This Regulation sets out standard rules and procedures for the resolution of credit institutions and investment firms within the framework of a Single Resolution Mechanism and a Single Resolution Fund (hereinafter, SRF) at a European level.

As part of the implementation of this Regulation, on 1 January 2016 the SRF came into effect, to operate as a financing instrument which the Single Resolution Board can use. The Single Resolution Board is the European authority that makes decisions on the resolution of failing banks, in order to efficiently undertake the resolution measures that have been adopted. The SRF receives contributions from credit institutions and investment firms subject to the same.

The calculation of each entity's contribution to the SRF, governed by Commission Delegated Regulation (EU) 2015/63, is based on the proportion that each entity represents with respect to the aggregate total liabilities of the Fund's member entities, after deducting own funds and the guaranteed amount of the deposits. The latter is then adjusted to the Institution's risk profile (see Note 32).

In 2024, the Bank made no contributions to the Single Resolution Fund.

Temporary levy of credit institutions and financial credit establishments

Law 38/2022 of 27 December was published on 28 December 2022. Among other aspects, it established a temporary levy for credit institutions and financial credit establishments. This levy was to be paid during 2023 and 2024 by credit institutions and financial credit establishments operating in Spain whose sum of interest income and fee and commission income in 2019 was 800 million euros or more. The payment amount was set at 4.8% of the sum of net interest income plus net fees and commissions stemming from their activities in Spain recognised on the income statement for the calendar year immediately preceding the year in which the payment obligation arose. The payment obligation arose every 1 January and had to be paid during the first 20 calendar days of the month of September of each year, without prejudice to a 50% advance payment of the total levy, which had to be made during the first 20 calendar days of the first February following the date on which the payment obligation arose (see Note 32).

1.3.20 Income taxes

Corporation tax applicable to the Spanish companies of Banco Sabadell Group, as well as similar taxes applicable to foreign investees, is considered to be an expense and is recognised under the heading "Tax expense or (-) income related to profit or loss from continuing operations" in the consolidated income statement, except when it arises as a result of a transaction that has been directly recognised in the consolidated statement of equity, in which case it is recognised directly in the latter.

The total corporation tax expense is equivalent to the sum of current tax, calculated by applying the relevant levy to taxable income for the year (after applying fiscally admissible deductions and benefits), and the variation in deferred tax assets and deferred tax liabilities recognised in the consolidated income statement.

Taxable income for the year may be at variance with the income for the year shown in the consolidated income statement, as it excludes items of income or expenditure that are taxable or deductible in other years as well as items that are non-taxable or non-deductible.

Deferred tax assets and deferred tax liabilities relate to taxes expected to be payable or recoverable arising from differences between the carrying amounts of the assets and liabilities appearing in the financial statements and the related tax bases ("tax value"), as well as tax losses carried forward and unused tax credits that might be offset or applied in the future. They are calculated by applying to the relevant timing differences or tax credits the tax rate at which they are expected to be recovered or settled (see Note 39).

A deferred tax asset, such as a tax prepayment or a credit in respect of a tax deduction or tax benefit, or a credit in respect of tax losses carried forward, is recognised provided that the Group is likely to obtain sufficient future taxable profits against which the tax asset can be realised, and that these are not derived from the initial recognition (except in a business combination) of other assets and liabilities in an operation that does not affect either the tax result or the accounting result.

Deferred tax assets arising due to deductible timing differences resulting from investments in subsidiaries, branches and associates, or from equity interests in joint ventures, are only recognised insofar as the difference is expected to be reversed due to the dissolution of the investee.

Deferred tax liabilities arising from timing differences associated with investments in subsidiaries and associates are recognised in the accounts unless the Group is capable of determining when the timing difference will reverse and, in addition, such a reversal is unlikely.

The "Tax assets" and "Tax liabilities" on the consolidated balance sheet include all tax assets and tax liabilities, differentiating between current tax assets/liabilities (to be recovered/paid in the next twelve months, for example, a corporation tax payment made to the tax authority (Hacienda Pública)) and deferred tax assets/liabilities (to be recovered/paid in future years).

Income or expenses recognised directly in the consolidated statement of equity that do not affect profits for tax purposes, and income or expenses that are not recognised directly and do affect profits for tax purposes, are recorded as timing differences.

At each year-end closing, recognised deferred tax assets and liabilities are reviewed to ascertain whether they are still current and to ensure that there is sufficient evidence of the likelihood of generating future tax profits that will allow them to be realised, in the case of assets, adjusting them as required.

To conduct the aforesaid review, the following variables are taken into account:

• Forecasts of results of each entity or tax group, based on the financial budgets approved by the Group's directors for a five-year period, subsequently applying constant growth rates similar to the mean long-term growth rates of the sector in which the various companies of the Group operate;
• Estimate of the reversal of timing differences on the basis of their nature; and
• The period or limit set forth by prevailing legislation in each country for the reversal of the different tax assets.

1.3.21 Consolidated statement of recognised income and expenses

This statement sets out the recognised income and expenses resulting from the Group's activity during the year, distinguishing between items recognised as profit or loss in the consolidated income statement and those recognised directly in consolidated equity.

1.3.22 Consolidated statement of total changes in equity

This statement sets out all changes in the Group's equity, including those arising from accounting changes and corrections of errors. It sets out a reconciliation of the carrying amount at the beginning and end of the year of all items that comprise consolidated equity, grouping changes together by type in the following items:

• Adjustments due to changes in accounting criteria and corrections of errors: includes changes in consolidated equity that arise as a result of the retroactive restatement of financial statement balances, distinguishing between those that arise from changes in accounting criteria and those that correspond to the correction of errors.
• Total recognised income and expenses: includes, in aggregate form, the total of items recognised in the aforesaid consolidated statement of recognised income and expenses.
• Other changes in consolidated equity: includes the remaining items recognised in consolidated equity, such as capital increases or decreases, distribution of dividends, transactions with own equity instruments, payments with own equity instruments, transfers between equity items and any other increase or decrease of consolidated equity.

1.3.23 Consolidated cash flow statement

Consolidated cash flow statements have been prepared using the indirect method, in such a way that, based on the Group's profit or loss, the non-monetary transactions and all types of deferred payment items and accruals which have been or will be the cause of operating income and expenses have been taken into account, in addition to the income and expenses associated with cash flows from activities classified as investing or financing activities.

No situations requiring the application of significant judgements to classify cash flows have arisen during the year.

There have been no significant transactions that have generated cash flows not reflected in the consolidated cash flow statement.

1.4 Comparability

The information contained in these consolidated annual financial statements corresponding to 2023 is provided solely and exclusively for purposes of comparison against the information for the year ended 31 December 2024 and therefore does not constitute the Group's consolidated annual financial statements for 2023.

1.5 Other information (tender offer)

Proposed merger and voluntary tender offer for the acquisition of shares of Banco Sabadell put forward by Banco Bilbao Vizcaya Argentaria, S.A.

In an Inside Information disclosure dated 30 April 2024, entered in the register of the Spanish National Securities Market Commission (CNMV) under number 2,227, Banco Sabadell confirmed that it had received, on that same day, an indicative written proposal from Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) for a merger (the Proposal). It also advised that the Board of Directors of Banco Sabadell would properly analyse all aspects of the Proposal.

Further to the aforementioned Inside Information disclosure, on 6 May 2024, through a separate Inside Information disclosure entered in the CNMV's register under number 2,234, Banco Sabadell submitted a press release on the decisions taken by its Board of Directors on that date, informing that Banco Sabadell, in fulfilment of its duties and with the assistance of financial advisors and a legal advisor, had carefully considered the Proposal and believed that it significantly undervalued the potential of Banco Sabadell and its standalone growth prospects. The press release also stated that the Board of Directors was highly confident in Banco Sabadell's growth strategy and its financial targets and was of the view that Banco Sabadell's standalone strategy would create superior value for its shareholders. Therefore, based on the detailed assessment of the Proposal, the Board of Directors had concluded that it was not in the best interest of Banco Sabadell and its shareholders and had therefore rejected BBVA's Proposal; this decision was, moreover, thought to be aligned with the interest of Banco Sabadell's customers and employees.

Furthermore, as part of its strong commitment to shareholder value creation and supported by the company's business plan and solid capital generation, the Board of Directors reiterated its commitment to distribute, on an ongoing basis, any excess capital above the 13% CET1 ratio pro forma Basel IV² to its shareholders. The overall excess capital amount to be generated over 2024 and 2025, together with recurrent dividends during this period according to a successful completion of the current business plan, was projected to be 2.4 billion euros³ , with part of the distribution to shareholders potentially subject to supervisory approval.

In addition, on 8 May 2024, through an Inside Information disclosure entered in the CNMV's register under number 2,240, with regard to the news published in the press on that same day, and to ensure that the market had complete and transparent information in respect thereto, the Bank published the verbatim text of the communication which, without any prior contact or exchange between the parties, was received by the Chairman of the Board of Directors of Banco Sabadell from the Chairman of the Board of Directors of BBVA on 5 May 2024. In that communication, the Chairman of BBVA's Board of Directors stated that, in connection with the terms of the proposed merger, BBVA had no room to improve its economic terms.

² Basel IV marks the final phase of the Basel III standards.

³ Subsequently, in July 2024, the estimation of Banco Sabadell's shareholder remuneration to be charged to the earnings of 2024 and 2025 was updated, announcing to the market that the expected amount would change from the 2.4 billion euros announced on 6 May 2024 (to be increased by the 250 million euros pending execution under Banco Sabadell's share buyback programme suspended on 13 May 2024 following publication of the prior announcement of the tender offer, which represented a total of 2.65 billion euros) to 2.9 billion euros (already including the aforesaid 250 million euros pending execution under the Bank's share buyback programme), representing a net increase of 250 million euros. Similarly, at its meeting of 6 February 2025, the Board of Directors updated its estimated total shareholder remuneration amount against earnings of 2024 and 2025 to 3.3 billion euros.

On 9 May 2024, BBVA sent the CNMV the prior announcement of a tender offer (the Offer) for the acquisition of all shares issued by Banco Sabadell, conditional upon its acceptance by 50.01% of the share capital of Banco Sabadell (subsequently amended to acceptance of the tender offer for a number of shares that allows BBVA to acquire at least more than half of the effective voting rights of Banco Sabadell, excluding any treasury shares held by Banco Sabadell at that time, which BBVA undertakes to redeem at the bank's first General Meeting of Shareholders following the tender offer) further conditional upon approval by the General Shareholders' Meeting of BBVA of the increase of its share capital through the issuance of new ordinary shares with non-cash contributions in an amount sufficient to fully cover the consideration offered, and further conditional upon obtaining authorisation by the National Markets and Competition Commission (CNMC) in Spain and by the Prudential Regulation Authority (PRA) in the United Kingdom. The transaction also requires approval by the CNMV and a statement of non-opposition from the European Central Bank.

On 24 May 2024, BBVA filed an application for authorisation of the tender offer with the CNMV, which was admitted for processing by the latter on 11 June 2024. The aforesaid offer initially consisted of one newly issued BBVA share for every 4.83 shares of Banco Sabadell.

On 1 October 2024, BBVA released an Other Relevant Information disclosure entered in the CNMV's register under number 30,745 announcing the adjustment of the consideration under the tender offer in the terms set forth in section 8 of the prior announcement of the offer, establishing, as from 10 October 2024 and following payment by Banco Sabadell and BBVA of their respective interim cash dividends charged to 2024, an exchange ratio of one newly issued ordinary share of BBVA and 0.29 euros in cash for every 5.0196 ordinary shares of Banco Sabadell that accept the offer.

On 5 July 2024, during the BBVA Extraordinary General Shareholders' Meeting, shareholders approved an increase of its share capital through the issuance of ordinary shares, up to a maximum nominal amount of 551,906,524.05 euros, with non-cash contributions in order to cover the consideration in kind of the voluntary tender offer put forward by BBVA for the acquisition of up to 100% of Banco Sabadell's shares.

Later, in September 2024, BBVA obtained authorisation from the UK's Prudential Regulation Authority (PRA) for the acquisition of indirect control over TSB and the ECB's decision not to oppose the takeover of Banco Sabadell.

As at the sign-off date of these annual financial statements, the tender offer remains pending receipt of regulatory authorisation from the CNMC (which on 12 November 2024 announced that its concentration analysis was moving to phase 2) and from the CNMV. It also remains pending acceptance of the offer by a number of shares that allows BBVA to acquire at least more than half of the effective voting rights of Banco Sabadell at the end of the offer acceptance period (therefore excluding any treasury shares held by Banco Sabadell at that time), in accordance with the amended offer released by BBVA on 9 January 2025 through an Inside Information disclosure entered in the CNMV's register under number 2,544.

For as long as the tender offer remains pending, it will generate uncertainty for the Group, which is inherent in the very nature of the offer put forward. At the present time, there can be no certainty as to how long it will take for the tender offer to be authorised, nor of the ultimate outcome of the tender offer, if approved.

Note 2 – Banco Sabadell Group

Subsidiaries and associates as at 31 December 2024 and 2023 are listed in Schedule I, along with their registered offices, primary activities, the percentage shareholding in each, key financial data and the consolidation method used (full consolidation or equity method) in each case.

Schedule II provides details of consolidated structured entities (securitisation funds).

A description is provided here below of the business combinations, acquisitions and sales or liquidations which are most representative of investments in the capital of other entities (subsidiaries and/or investments in associates) made by the Group during 2024 and 2023. Schedule I also includes details of changes in the scope of consolidation in each financial year and the profit or loss obtained by the Group on the disposal of its subsidiaries and associates.

Changes in the scope of consolidation in 2024

Additions to the scope of consolidation:

No significant additions to the scope of consolidation took place in 2024.

Exclusions from the scope of consolidation:

No significant exclusions from the scope of consolidation took place in 2024.

Changes in the scope of consolidation in 2023

Additions to the scope of consolidation:

No significant additions to the scope of consolidation took place in 2023.

Exclusions from the scope of consolidation:

On 22 December 2022, the Board of Directors of Banco de Sabadell, S.A. and the Board of Directors of Bansabadell Financiación, E.F.C., S.A.U. approved and signed the common draft terms of the merger between Banco de Sabadell, S.A. (as the absorbing company) and Bansabadell Financiación, E.F.C., S.A.U. (as the absorbed company). Having obtained the relevant authorisations, the deed of the merger by absorption of Bansabadell Financiación E.F.C., S.A. by Banco de Sabadell, S.A. was entered in the Alicante Companies Register on 10 October 2023. As Bansabadell Financiación, E.F.C., S.A.U. was a company directly and fully owned by the Bank (see Schedule I – Changes in the scope of consolidation in 2023), this transaction had no significant impact on the Group's consolidated financial statements.

With the exception of the transaction described above, no significant exclusions from the scope of consolidation took place in 2023.

Other significant transactions in 2024

The Group made no other significant transactions meriting disclosure in 2024.

Other significant transactions in 2023

On 27 February 2023, Banco Sabadell signed a strategic deal to provide merchant acquiring services with Nexi S.p.A. (hereinafter, "Nexi"), a leading European paytech company, for a renewable ten-year period, under which Nexi is to acquire 80% of Banco Sabadell's payments subsidiary Paycomet, S.L.U. for 280 million euros. Banco Sabadell will retain a 20% stake for at least three years, whilst aligning interests with its new industrial partner. Following this period, Banco Sabadell will have the option to sell that 20%.

The total transaction amount was fixed at 350 million euros (280 million euros due to the 80% subject to sale), which may be increased depending on the achievement of certain targets.

As at the sign-off date of these consolidated annual financial statements, the necessary regulatory authorisations to close this transaction have been obtained. The transaction is expected to be completed in 2025, once the outcome of the tender offer for the acquisition of shares representing the total share capital of the Bank, described in Note 1.5, is known.

Note 3 – Shareholder remuneration and earnings per share

Set out below is the proposed distribution of the profits earned by Banco de Sabadell, S.A. in 2024, which the Board of Directors will submit to shareholders for approval at the Annual General Meeting, together with the proposed distribution of profits earned by Banco de Sabadell S.A. in 2023, which was approved by shareholders at the Annual General Meeting of 10 April 2024:

Thousand euro
	2024	2023
To dividends (*)	1,095,867	326,413
To Canary Island investment reserve	145	183
To voluntary reserves	409,803	761,418
Profit for the year of Banco de Sabadell, S.A.	1,505,815	1,088,014

(*) Amount corresponding to the interim cash dividend paid on 1 October 2024 of 0.08 euros (gross) per share and to the estimated dividend amount of 0.1244 euros (gross) per share, to be paid in cash. This estimate has been calculated taking into account (a) that, as at the sign-off date of these consolidated annual financial statements, the Bank is the holder of 78,840,390 treasury shares, (b) that, as a result of the restrictions placed on treasury stock transactions stemming from the voluntary tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. for the acquisition of Banco Sabadell shares representing its total share capital (see Note 1.5), the Institution does not expect those shares to be placed back in circulation on the market prior to the dividend payment date, and (c) that, as required by the Capital Companies Act, treasury shares do not carry rights to obtain dividends.

At its meeting held on 22 July 2024, the Board of Directors of Banco Sabadell agreed to distribute an interim dividend in cash, to be paid out of its earnings for 2024, of 0.08 euros (gross) per share, which was paid on 1 October 2024.

In fulfilment of the mandatory requirement indicated in Article 277 of Spain's Capital Companies Act (Ley de Sociedades de Capital), the provisional statement of accounts provided below was created by the Bank to confirm the existence of sufficient liquidity and profit at the time of its approval of the aforesaid interim dividend:

Thousand euro
Available for the payment of dividends according to the provisional statement as at:	30/06/2024
Banco Sabadell profit as at the date indicated, after provisions for taxes Estimated statutory reserve	788,703 —
Estimated Canary Island investment reserve	36
Maximum amount available for distribution	788,667
Interim dividend proposed Cash balance available at Banco de Sabadell, S.A. (*)	428,915 22,669,798

(*) Includes the balance of the heading "Cash, cash balances at central banks and other demand deposits".

In addition to the cash interim dividend, during the aforesaid meeting, the Board of Directors of Banco Sabadell agreed to set the percentage of profits to be distributed to shareholders, in other words the Group's payout ratio, at 60% of the Group's net attributable profit for 2024. This payout ratio is at the top of the range established by the Group's Shareholder Remuneration Policy.

Later, on 6 February 2025, Banco Sabadell's Board of Directors agreed to submit a proposal to the Annual General Meeting for the distribution of a final dividend of 0.1244 euros (gross) per share, to be paid in cash out of the earnings of 2024. This dividend, together with the one mentioned previously, result in a total cash dividend to be paid out of the earnings of 2024 of 0.2044 euros (gross) per share.

In addition, during the aforementioned meeting of 6 February 2025, the Board of Directors of Banco Sabadell, having obtained prior authorisation from the competent authority, decided that a proposal would be submitted at the next Annual General Meeting to resume execution of the share buyback programme approved at the Annual General Meeting of April 2024, in the amount of 247 million euros, equivalent to 0.0461 euros (gross) per share, which was temporarily suspended as per the request of the CNMV received on 13 May 2024 in light of the publication of the announcement of the tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. (see Note 1.5). Similarly, during that meeting, and also having obtained the previous authorisation from the competent authority, the Board of Directors agreed to submit a proposal to the next Annual General Meeting to distribute excess capital above the 13% fully-loaded CET1 ratio (postimpact of Basel IV⁴ ), through a share buyback programme, in the amount of 755 million euros, equivalent to 0.1408 euros (gross) per share.

⁴ Basel IV marks the final phase of the Basel III standards.

Based on the foregoing, total shareholder remuneration in 2024 will amount to 2,098 million euros, equivalent to 0.3913 euros (gross) per share, of which 1,096 million euros (0.2044 euros gross per share) correspond to the cash dividend and 1,002 million euros (0.1869 euros gross per share) correspond to buyback programmes.

At its meeting of 31 January 2024, the Board of Directors submitted a proposal to the Annual General Meeting concerning the distribution of a final gross cash dividend of 0.03 euros per share to be paid out of 2023 earnings, which was approved at the Annual General Meeting on 10 April 2024 and paid out in the same month. Previously, the Board of Directors of Banco Sabadell had agreed, on 25 October 2023, to distribute an interim dividend in cash, to be paid out of its earnings in 2023, of 0.03 euros (gross) per share, which was paid on 29 December 2023. Consequently, the cash dividend reached 0.06 euros per share, paid out of 2023 earnings, which the Bank had intended to complement with the share buyback programme that was subsequently suspended, as described in the following section.

Share buyback programme

Share buyback programme in 2024

On 10 April 2024, the Ordinary Annual General Meeting of Banco Sabadell approved a resolution to reduce share capital by the par value of the treasury shares that may be acquired by Banco Sabadell under the share buyback programme, against earnings for 2023, for a maximum pecuniary amount of 340 million euros.

Subsequently, on 25 April 2024, Banco Sabadell announced, through an Inside Information disclosure entered in the CNMV's register under number 2,203, the terms and the start date of the treasury share buyback programme approved by the Board of Directors on 24 April 2024, in accordance with the provisions of Article 5 of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and Commission Delegated Regulation (EU) 2016/1052 of 8 March 2016.

As indicated above, on 13 May 2024, pursuant to the request received from the CNMV on that same date, the Bank released an Other Relevant Information disclosure, entered in the CNMV's register under number 28,561, giving notice of the interim suspension of the aforementioned share buyback programme in light of the publication of the prior announcement of the voluntary tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. for the acquisition of Banco Sabadell shares representing its total share capital (see Note 1.5).

The operation of the buyback programme was discontinued before the opening of the session of 9 May 2024, the amount paid for the shares purchased under the buyback programme up to (and including) 8 May 2024 being 92,864,152.55 euros, representing approximately 27.31% of the maximum pecuniary amount of the buyback programme, therefore approximately 72.69% of the said maximum amount remains to be executed.

At its meeting of 29 January 2025, the Bank's Board of Directors agreed to partially execute the capital reduction resolution approved by the Annual General Meeting on 10 April 2024, in the amount of 6,566,420.625 euros, through the redemption of the 52,531,365 shares acquired by virtue of the aforesaid buyback programme up to the time of its suspension. The aforesaid resolution already envisaged the possibility of it not being executed or only partially executed due to unforeseen circumstances (see Note 23).

Share buyback programme in 2023

On 30 June 2023, after receiving the required authorisation from the European Central Bank, Banco Sabadell gave notice, by means of an Inside Information disclosure, of the establishment and execution of a temporary share buyback programme for a maximum amount of 204 million euros for the purpose of reducing the Bank's share capital through the redemption of the treasury shares acquired. The buyback programme was carried out in accordance with the provisions of Article 5 of Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and Commission Delegated Regulation (EU) 2016/1052 of 8 March 2016.

On 13 November 2023, the Bank gave notice, by means of an Other Relevant Information disclosure, of the end of the share buyback programme as the maximum pecuniary amount mentioned above had been reached, having acquired 186,743,254 treasury shares with a par value of 0.125 euros each, representing approximately 3.32% of Banco Sabadell's share capital.

On 30 November 2023, the Board of Directors agreed to execute Banco Sabadell's share capital reduction through the redemption of all the treasury shares acquired under the share buyback programme. Execution of the capital reduction was approved under the powers conferred to the Board of Directors at the Ordinary Annual General Meeting held on 23 March 2023 in the amount of 23,342,906.75 euros. The public deed corresponding to the capital reduction was entered with the Companies Register of Alicante on 11 December 2023 (see Note 23).

Earnings per share

Basic earnings (or loss) per share are calculated by dividing the net profit attributable to the Group, adjusted by earnings on other equity instruments, by the weighted average number of ordinary shares outstanding in the year, excluding any treasury shares acquired by the Group. Diluted earnings (or loss) per share are calculated by applying adjustments for the estimated effect of all potential conversions of ordinary shares to the net profit attributable to the Group and the weighted average number of ordinary shares outstanding.

The Group's earnings per share calculations are shown below:

	2024	2023
Profit or loss attributable to owners of the parent (thousand euro)	1,826,805	1,332,181
Adjustment: Remuneration of other equity instruments (thousand euro)	(98,155)	(115,391)
Profit or (-) loss after tax from discontinued operations (thousand euro)	—	—
Profit or loss attributable to owners of the parent, adjusted (thousand euro)	1,728,650	1,216,790
Weighted average number of ordinary shares outstanding (**)	5,376,450,440	5,401,123,639
Assumed conversion of convertible debt and other equity instruments	—	—
Weighted average number of ordinary shares outstanding, adjusted	5,376,450,440	5,401,123,639
Earnings (or loss) per share (euros)	0.32	0.23
Basic earnings (or loss) per share adjusted for the effect of mandatory convertible	0.32	0.23
bonds (euros)
Diluted earnings (or loss) per share (euros)	0.32	0.23

(*) Average number of shares outstanding, excluding the average number of own shares held in treasury stock during the year.

As at 31 December 2024 and 2023, there were no other financial instruments or share-based commitments with employees with a significant impact on the calculation of diluted earnings (or loss) per share for the periods presented. For this reason, basic earnings (or loss) per share coincide with diluted earnings (or loss) per share.

The distributions of profits of subsidiaries are subject to approval by shareholders at their respective Annual General Meetings.

Note 4 – Risk management

Throughout 2024, Banco Sabadell Group has continued to strengthen its risk management and control framework by incorporating improvements in accordance with supervisory expectations and market trends.

Bearing in mind that Banco Sabadell Group takes risks during the course of its activity, good management of these risks is a central part of the business. The Group has established a set of principles, set out in policies and rolled out through procedures, strategies and processes, which aim to increase the probability of achieving the strategic objectives of the Group's various activities, facilitating management in an uncertain environment. This set of principles is called the Global Risk Framework.

4.1. Macroeconomic, political and regulatory environment

Macroeconomic environment

When managing risks, the Group considers the macroeconomic environment. The most salient aspects of 2024 are set out below:

• The year 2024 was marked by the US economy maintaining its momentum, showing greater-thanexpected resilience, and the Eurozone being particularly weighed down by Germany's weakness.
• Spain continued to outperform other Eurozone countries. Growth was underpinned by factors such as flows of immigration, the recovery of real incomes, the good financial situation of households and businesses, interest rate cuts and the ongoing rollout of Next Generation European Union (NGEU) funds.
• The emerging economies, in general, continued to show resilience, despite the high interest rate environment at a global level. The adjustment of China's real estate sector continued, which led authorities to announce a significant package of stimulus measures.
• As for Mexico, activity was subdued, weighed down by restrictive monetary policy and domestic and foreign political uncertainty.
• Inflation moved closer towards the targets set by central banks during 2024, although the services component continued to be sticky.
• Geopolitics continued to be a source of uncertainty for the economic environment. The conflict in the Middle East saw several episodes of instability, but continued to have a limited impact on the markets.
• The domestic policy of several countries also captured the markets' attention, with the presidential elections in the United States and the subsequent victory of Donald Trump, and with the increasing political noise in France and Mexico after their own elections.
• Central banks gained confidence regarding their inflation forecasts and at the mid-year mark started to cut official interest rates, although they were cautious about the future evolution of interest rates.
• The European Central Bank began its series of interest rate cuts in June and placed the deposit rate at 3.00% (down from 4.00%). Furthermore, its balance sheet continued to be reduced, due to the discontinuation of reinvestments under the Pandemic Emergency Purchase Programme (PEPP) and the repayment of all liquidity from TLTRO III.
• The Federal Reserve (Fed) cut the target range of the Fed funds rate by 100 basis points to 4.25%-4.50% and indicated that the pace of cuts going forward will be gradual.
• The Bank of England (BoE) started its series of cuts by slashing the base rate by 25 basis points in August and November, to 4.75%.
• Financial markets once again performed well in 2024, building up from last year's positive performance.
• Yields on long-term government bonds of the main developed countries ended the year at levels above those of 2023 year-end, although with clear signs of volatility during the year as the market progressively adjusted its policy rate cut expectations.
• The risk premiums on peripheral sovereign debt stood at levels lower than those seen at the end of 2023, underpinned by credit rating agencies' positive actions, good activity data, the ECB's emergency programmes and the disbursement of the NGEU funds.
• Meanwhile, France's risk premium significantly rebounded in the face of considerable political uncertainty, the bad shape of its public finances and the negative actions of credit rating agencies.
• The euro ended the year at more depreciated levels than the dollar, impacted by differences in monetary policy between the Eurozone and the United States, as well as the US presidential elections.
• As for the financial markets of emerging countries, sovereign risk premiums rose slightly, in an environment in which tax risks continued to attract attention in countries such as Brazil and Colombia and in which political uncertainty increased in Mexico. This, compounded by falling oil prices, also weighed on these countries' currencies.
• The banking sector continued to improve its metrics amidst increased profitability, driven by the positive evolution of net interest income and fee and commission income.
• The financial authorities deemed that the risks associated with global financial stability had moderated. The main concerns revolved around financial and geopolitical factors, while strictly macroeconomic concerns started to fade away.

Political and regulatory environment

DANA response measures

In November 2024, the Spanish government launched the Immediate Response, Rebuilding and Relaunch Plan in the aftermath of the natural disaster caused by the isolated high altitude depression phenomenon known in Spain as DANA that took place last October and mainly affected the Community of Valencia. This plan was initially implemented through Royal Decree-Law 6/2024 of 5 November, followed by Royal Decree-Law 7/2024 of 11 November, and finally by Royal Decree-Law 8/2024 of 28 November. These decrees include a set of measures aimed at addressing the liquidity needs of households, self-employed professionals and businesses, such as the rollout of the ICO-DANA line of guarantees, furnished with up to 5 billion euros, and statutory moratoria.

Specifically, the Spanish Ministry of Economy, Trade and Business, at a meeting of the Council of Ministers held on 11 November 2024, adopted an agreement establishing the terms and conditions of the first tranche of this line of guarantees for 1 billion euros, setting the guarantee's percentage at 80% of the capital. In addition, the aforementioned agreement allows obligors released under Article 29 of Royal Decree-Law 8/2020 of 17 March, Article 1 of Royal Decree-Law 25/2020 of 3 July and Article 29 of Royal Decree-Law 6/2022 of 29 March, who meet the requirements laid down in Article 32 of Royal Decree-Law 6/2024 to request the suspension of principal and interest repayments. At a meeting of the Council of Ministers of 28 November 2024, an agreement was signed to open up a new tranche of the ICO-DANA line of guarantees for self-employed persons and SMEs for 240 million euros.

Furthermore, a three-month statutory moratorium for households, self-employed professionals and businesses (with turnover of up to 6 million euros) on principal and interest repayments and an additional nine-month moratorium on principal repayments were put in place.

The Group carried out a preliminary assessment of its exposure potentially affected by the event. To that end, the potentially affected perimeter was identified using the postcodes of the municipalities included in the scope of application of Royal Decree-Law 6/2024 of 5 November, taking into account:

• Mortgage-backed exposures which, using the coordinates in which the main collateral was located, coincided with a flooded location;
• Corporate exposures in which the company's registered office, using the coordinates of the same, coincided with a flooded location; or
• Unsecured retail exposures which were part of a list of most affected municipalities compiled internally using the same satellite information provided by Copernicus.

Based on these criteria, the Group's exposure that met any of the aforementioned conditions stood at 396 million euros as at the date of the event, 30 October 2024. The Group has estimated DANA's impact as at 2024 year-end on the accounting classification on the basis of credit risk and on the expected loss based on the updated exposure, reclassifying exposures as stage 2 or stage 3 in the amount of 255 million euros and 96 million euros, respectively, and applying an adjustment to the expected loss in the amount of 45 million euros (see Note 4.4.2.5 - Calculation of credit loss allowances).

As at 31 December 2024, the Group had arranged 1,437 statutory moratoria for a total amount of 60 million euros, distributed between 828 transactions granted to households amounting to 34 million euros, 272 transactions granted to self-employed professionals amounting to 12 million euros, and 337 transactions granted to companies and businesses amounting to 14 million euros, as well as one ICO guarantee transaction amounting to 3 million euros.

War between Russia and Ukraine

The war between Russia and Ukraine continues after three years of conflict. The Group's credit risk with both individuals and companies from these countries is limited, and the same is true of its counterparty credit risk with financial institutions from Russia and Ukraine. Specifically, the largest exposures relate to mortgage loans granted to customers of Russian, Ukrainian or Belarusian nationality residing outside Spain, which amounted to 181 million euros and 233 million euros as at 31 December 2024 and 2023, respectively. The real estate assets securing those exposures are located in Spain and have an average loan-to-value of 35.2% and 37.7% as at 31 December 2024 and 2023, respectively. Furthermore, these are all transactions that, on average, were originated more than eight years ago.

Measures to ease the mortgage burden and strengthen financial inclusion

On 22 November 2022, the government adopted a package of measures to help ease the mortgage burden and support vulnerable families and those at risk of vulnerability in a context of increasing mortgage costs as a result of interest rate hikes. The aforementioned measures were implemented through three pillars: improving the treatment of vulnerable families, by amending and extending the 2012 Code of Good Practice (principal grace period, interest rate reduction, extension of the mortgage term); the creation of a new framework of action for middle-class families at risk of vulnerability (new temporary Code of Good Practice, lasting two years, which entailed a 12-month freeze on repayments, a lower interest rate on the deferred principal and an extension of the term of up to seven years); and, lastly, the early repayment of loans and switching from a mortgage with a variable rate to one with a fixed rate was made easier through the temporary elimination and subsequent reduction of the penalty or fee charged for these items.

Subsequently, on 27 December 2023, Royal Decree-Law 8/2023 prolonging certain anti-crisis measures was adopted, which extended the duration of most of the measures adopted in 2022 and 2023. These measures also included a series of measures aimed at strengthening the financial inclusion of older and/or disabled persons, including the removal of fees charged for cash withdrawals at bank counters, and the preventive framework to provide relief to at-risk mortgage holders was extended.

In the aftermath of the DANA emergency, Royal Decree-Law 8/2023 was amended on 11 November 2024 by Royal Decree-Law 7/2024, extending the Code of Good Practice by a further 12 months, and by a further 18 months for those affected by DANA.

4.2 Key milestones during the year

4.2.1 The Group's risk profile during the year

The following milestones have been achieved in relation to the Group's risk profile during 2024:

I. Non-performing assets:

– During 2024, non-performing assets were reduced by 1,068 million euros. The NPL ratio for the year stands at 2.84% compared to 3.52% in 2023.

II. Lending performance:

• Gross performing loans granted to customers ended the year 2024 with a balance of 156,913 million euros, increasing by 4.7% year-on-year.
• In Spain, gross performing loans in year-on-year terms posted a 5.3% improvement, driven by the increase of lending to corporates and individuals, as well as the good performance of foreign branches.
• In TSB, at a constant exchange rate, gross performing loans remained stable.
• In Mexico, at a constant exchange rate, gross performing loans fell -4.6% in year-on-year terms.

III. Concentration:

• From a sectoral point of view, the loan portfolio is diversified and has limited exposure to the sectors most sensitive to the current economic environment.
• Similarly, in terms of individual concentration, the risk metrics relating to concentration of large exposures showed a slight downward trend and remained within the appetite level. The credit rating of large exposures also improved over the year.
• Geographically speaking, the portfolio is positioned in dynamic regions, both in Spain and worldwide. International exposures account for 37% of the loan book.

IV. Strong capital position:

• The CET1 ratio stood at 13.02% as at 2024 year-end compared to 13.19% in 2023.
• The Total Capital ratio stood at 17.60% as at the end of 2024, thus remaining above the requirements for 2025 with an MDA buffer of 406 basis points. The Leverage Ratio stood at 5.20%.

V. Sound liquidity position:

– The short-term Liquidity Coverage Ratio (LCR) stood at 210% (compared with 228% at the end of 2023), with total liquid assets of 65,257 million euros (61,783 million euros as at the end of 2023).

4.2.2 Strengthened credit risk management and control environment

2024 was a year marked by lower interest rates once the inflationary pressures that characterised 2022 and 2023 as a result of the geopolitical situation were overcome. This, together with the strengthened risk management and control tools, led to a reduced impact on customers' default rates and a significant reduction in inflows of non-performing loans.

In the area of credit risk management, in 2024 the Bank continued to reinforce the control environment by reviewing and updating credit risk frameworks, as well as annually reviewing the Sector Guidance Strategy, in which the Institution sets its positioning (asset allocation) at the sub-sectoral level, this aspect being particularly important given the current macroeconomic environment.

In addition, credit risk management activities focused on healthily growing the loan book. For instance, it is worth noting the evolution seen in the retail consumer loan portfolio in recent years, on which, prior to the growth in terms of volumes, improvements to credit risk valuation models, procedures and workflows were made to ensure the quality of new lending items. As a result, the Institution has significantly grown the amount of new loans of this portfolio, also underpinned by an improvement in its risk profile, with granting focused on pre-approvals. This same process is being replicated with some adaptations, and it is expected to have positive impacts on the other segments, and the Bank can already see growth in this regard in 2024 in the retail mortgage book.

As for business loans, the Institution also continued to strengthen the origination and monitoring processes. For smaller segments, the probability of default gains more relevance, and the risk granting and rollover process is more closely linked to provisions and the credit cost of risk of this segment. These actions are already yielding positive results in asset quality, but the Bank expects that these results will gradually and progressively lead to a continuous improvement of the loan book's risk profile.

The Credit Risk Control unit paid special attention to strengthening the framework of RAS metrics, risk frameworks were revised and the risk exposure to the sectors most severely impacted by the current environment was assessed, proactively managing the counterparties could potentially be hit the hardest.

The measures adopted to support companies and individuals over the last few years to help mitigate the effects of the various events that have occurred (pandemic, rising energy prices with a big impact on some industries, inflation, rapid increase in interest rates, and the DANA emergency at the end of 2024, among others) proved effective. Exposure to the support lines granted in previous years, especially the ICO lines to deal with the effects of the pandemic, continued to mature in 2024 (an annual drop of 34% to 3.1 billion euros).

In the United Kingdom, despite the interest rate cuts implemented by the Bank of England during 2024, interest rates are expected to remain high for longer than initially anticipated by the market. This could undermine debtors' repayment capacity. Consequently, the focus of regulators and financial institutions continues to be on establishing adequate and agile communication channels, tools and training to support and proactively help customers, in particular those in vulnerable situations. Furthermore, the tool established in mid-2023 by the government, the Mortgage Charter, remains in place to help mortgage borrowers. Although it is worth noting that its use is not very widespread.

With regard to the credit risk control framework, throughout 2024, TSB has strengthened the set of RAS metrics for retail mortgages and consumer loans. Furthermore, the Group has increased the number of local TSB metrics which it monitors in order to improve their visibility.

4.3 General principles of risk management

Global Risk Framework

The Global Risk Framework aims to establish the common basic principles relating to the risk management and control activity of Banco Sabadell Group including, among other things, all actions associated with the identification, decision-making, measurement, assessment, monitoring and control of the different risks to which the Group is exposed. With the Global Risk Framework, the Group aims to:

• Take risks following a well-structured approach that is consistent throughout the Group.
• Foster an open and transparent culture in relation to risk management and control, encouraging the involvement of the entire organisation.
• Facilitate the decision-making process.
• Align the accepted risk with the risk strategy and the risk appetite.
• Understand the risk environment in which the Institution operates.
• Ensure, following the guidelines of the Board of Directors, that critical risks are identified, understood, managed and controlled efficiently.

The Group's Global Risk Framework comprises the following elements:

• The Group's Global Risk Framework Policy.
• The Risk Appetite Framework (RAF) of the Group and subsidiaries.
• The Risk Appetite Statement (RAS) of the Group and subsidiaries.
• Specific policies for the various material risks to which the Group and subsidiaries are exposed.

4.3.1 Global Risk Framework Policy

As an integral part of the Global Risk Framework, the Global Risk Framework Policy establishes the common basic principles for Banco Sabadell Group's risk management and control activities, including, among other things, all actions associated with the identification, decision-making, measurement, assessment, monitoring and control of the different risks to which the Group is exposed. These activities comprise the duties carried out by the various areas and business units of the Group as a whole.

Consequently, the Global Risk Framework Policy sets out a general framework for the establishment of other policies related to risk management and control, determining core/common aspects that are applicable to the various risk management and control policies.

The Global Risk Framework is applied in all of the Group's business lines and entities, taking into account proportionality criteria in relation to their size, the complexity of their activities and the materiality of the risks taken.

Principles of the Global Risk Framework

For risk management and control to be effective, the Group's Global Risk Framework must comply with the following principles:

– Risk governance and involvement of the Board of Directors through the model of three lines of defence, among others.

The risk governance arrangements established in the various policies that form part of the Global Risk Framework promote a sound organisation of risk management and control activities, categorising risk, defining limits and establishing clear responsibilities at all levels of the organisation through policies, procedures and manuals specific to each risk.

Among other duties, the Board of Directors of Banco de Sabadell, S.A. is responsible for identifying the Group's main risks, implementing and monitoring appropriate internal control and reporting systems, which include challenging and monitoring the Group's strategic planning and supervising the management of material risks and their alignment with the risk profile defined by the Group.

Similarly, the equivalent bodies of the Group's various subsidiaries have the same level of involvement in risk management and control activities at the local level.

The Group's risk governance arrangements are designed to organise risk management and control activities by means of the model of three lines of defence, granting independence, hierarchical authority and sufficient resources to the Risk Control function. In the same way, the governance model seeks to ensure that risk management and control processes offer an end-to-end vision of the phases involved.

– Alignment with the Group's business strategy, particularly through the implementation of the risk appetite throughout the entire organisation;

Through the set of policies, procedures, manuals and other documents that comprise it, the Group's Global Risk Framework is aligned with the Group's business strategy, adding value as it is designed to contribute to the achievement of objectives and improve medium-term performance. It is therefore embedded in key processes such as strategic and financial planning, budgeting, capital and liquidity planning and, in general, business management.

– Integration of the risk culture, focusing on aligning remuneration with the risk profile;

Corporate culture and corporate values are key elements, as they reinforce ethical and responsible behaviour by all members of the organisation.

The Group's risk culture is based on compliance with the regulatory requirements applicable to all of its areas of activity, ensuring compliance with supervisory expectations and best practices in risk management, monitoring and control.

One of the priorities established by the Group is the maintenance of a sound risk culture in the aforesaid terms, on the understanding that this lays the groundwork for appropriate risk-taking, makes it easier to identify and manage emerging risks, and encourages employees to carry out their activities and engage in the business in a legal and ethical manner.

– A holistic view of risk that translates into the definition of a taxonomy of first- and second-tier risks based on their nature; and

The Global Risk Framework, through the set of documents that comprise it, considers a holistic view of risk: it includes all risks, paying particular attention to the correlation between them (inter-risk) and within the risk itself (intra-risk), as well as the effects of concentration.

– Alignment with the interests of stakeholders

The Group regularly makes material disclosures to the public, so that market participants can maintain an informed opinion as to the suitability of the management and control framework for these risks, thus ensuring transparency in risk management.

Similarly, risks are managed and controlled with a view to safeguarding the interests of the Group and its shareholders at all times.

4.3.2 Risk Appetite Framework (RAF)

The risk appetite is a key element in setting the risk strategy, as it determines the scope of action. The Group has a Risk Appetite Framework (RAF) Policy that sets out the governance framework governing its risk appetite.

Consequently, the RAF establishes the structure and mechanisms associated with the governance, definition, communication, management, measurement, monitoring and control of the Group's risk appetite established by the Board of Directors of Banco de Sabadell, S.A.

Effective implementation of the RAF requires an adequate combination of policies, processes, controls, systems and procedures, not only to achieve a set of defined targets and objectives, but also to do so in an efficient and continuous way.

The RAF covers all the Group's business lines and units, in accordance with the principle of proportionality, and it is designed to enable suitably informed decisions to be made, taking into account the material risks to which it is exposed, including both financial and non-financial risks.

The RAF is aligned with the Group's strategy and with the strategic planning and budgeting processes, the internal capital and liquidity adequacy assessments, the Recovery Plan and the remuneration framework, among other things, and takes into account the material risks to which the Group is exposed, as well as their impact on stakeholders, such as shareholders, customers, investors, employees and the general public.

4.3.3 Risk Appetite Statement (RAS)

The RAS is a key element in determining the Institution's risk strategies. It establishes qualitative expressions and quantitative limits for the different risks that the Institution is willing to accept, or wishes to avoid, in order to achieve its business objectives. Depending on the nature of each risk, the RAS includes both qualitative aspects and quantitative metrics, which are expressed in terms of capital, asset quality, liquidity, profitability or any other measure deemed to be relevant. The RAS is therefore a key element in setting the risk strategy, as it determines the scope of action.

Qualitative aspects of the RAS

The Group's RAS includes the definition of a set of qualitative aspects, which essentially help to define the Group's position with regard to certain risks, especially when those risks are difficult to quantify.

These qualitative aspects complement the quantitative metrics, establish the general tone of the Group's approach to risk-taking and define the reasons for taking or avoiding certain types of risks, products, geographical exposures and other matters.

Quantitative aspects of the RAS

The set of quantitative metrics defined in the RAS is intended to provide objective elements with which to compare the Group's situation against the goals or challenges proposed at the risk management level. These quantitative metrics follow a hierarchical structure, as established in the RAF, with three levels: board (or first-tier) metrics, executive (or second-tier) metrics and operational (or third-tier) metrics.

Each of these levels has its own approval, monitoring and action arrangements that should be followed in the event a threshold is ruptured.

In order to gradually detect possible situations of deterioration of the risk position and thus be able to monitor and control it more effectively, the RAS sets out a system of thresholds associated with the quantitative metrics. These thresholds reflect the desirable levels of risk for each metric, as well as the levels that should be avoided. A rupture of these thresholds can trigger the activation of remediation plans designed to rectify the situation.

These thresholds are established to reflect different levels of severity, making it possible to take preventive action before excessive levels are reached. Some or all of the thresholds will be established for a given metric, depending on the nature of that metric and its hierarchical level within the structure of RAS metrics.

4.3.4 Specific policies for the various material risks

The set of policies for each of the risks, together with the procedures and operational and conceptual manuals that form part of the body of regulations of the Group and its subsidiaries, are tools that the Group and its subsidiaries rely on to expand on more specific aspects of each risk.

For each of the Group's material risks, the policies describe the principles and critical management parameters, the main people and units involved and their duties (including the roles and responsibilities of the various units and committees in relation to risks and their control systems), the associated procedures, as well as monitoring and control mechanisms.

4.3.5 Risk governance

Governance structure

The Board of Directors of Banco de Sabadell, S.A. is the body responsible for establishing the general guidelines for the organisational distribution of the risk management and control functions, as well as determining the main strategies in this regard, and for ensuring consistency with the Group's short- and longterm strategic objectives, as well as with the business plan, capital and liquidity planning, risk-taking capacity and remuneration schemes and policies.

The Board of Directors of Banco de Sabadell, S.A. is also responsible for approving the Group's Global Risk Framework.

In addition, within the Board of Directors of Banco de Sabadell, S.A. itself, there are five Board Committees involved in the Group's Global Risk Framework and, therefore, in risk management and control (the Board Risk Committee, the Board Strategy and Sustainability Committee, the Delegated Credit Committee, the Board Audit and Control Committee and the Board Remuneration Committee). There are also other Committees and Divisions with a significant level of involvement in the risk function.

	Management Committee
	Technical Risk Committee	Risk Operations Committee	Portfolio Monitoring & NPA Management Committee	Internal Control Body	Asset and Liability Committee	Corporate Ethics Committee	UK Steering Committee
Main Committees related to risks	Supports Board Risk Committee and Risk Management	Decides whether to authorise credit risks as per conferred powers	Coordinates recovery cycle and proactive management strategies	Ensures compliance with AML/ CFT legislation	Ensures structural balance sheet risks are managed	Ensures ethical behaviour of the Group	Ensures alignment between Group and TSB policies

The defined governance structure aims to ensure the adequate development and implementation of the Global Risk Framework and, therefore, the risk management and control activity within the Group, while at the same time it aims to facilitate:

• The participation and involvement of the Group's governing bodies and Senior Management in decisions regarding risks, and also in their supervision and control.
• The alignment of targets and objectives at all levels, monitoring their achievement and implementing corrective measures where necessary.
• The existence of an adequate management and control environment for all risks.

Organisation

The Group establishes an organisational model for assigning and coordinating risk control responsibilities based on the three lines of defence. For each risk, the model draws on the various policies included in the Group's body of regulations, which set out the specific responsibilities of each of the three lines of defence.

For each line of defence, the risk policies describe and assign responsibilities, as appropriate, to the following functions (or any other additional ones that ought to be considered):

• First line of defence: responsible for maintaining adequate and effective internal control and implementing corrective actions to rectify deficiencies in its processes and controls. The responsibilities attributed to this line under the Global Risk Framework are as follows:
  • Maintain effective internal controls and systematically execute the control framework.
• • Identify, quantify, control and mitigate risks, complying with the established internal policies and procedures and ensuring that activities are consistent with the established goals and objectives.
• Implement suitable processes to manage and mitigate material risks.
• Participate in decision-making processes, identifying, assessing, controlling and mitigating the risks inherent in the implementation of significant changes and one-off transactions.
• Define the strategy for each risk.
• Second line of defence: broadly speaking, the second line of defence ensures that the first line of defence is well designed and performs its assigned duties. It also puts forward suggestions for its continuous improvement. The core duties attributed to this line are the following:
  • Propose the Global Risk Framework, for risk management and control.
  • Participate in the decision-making process where it concerns the implementation of significant changes and one-off transactions.
  • Monitor the risk strategy approved by the Board of Directors through its approval of the RAS.
  • Keep the risk inventory up to date, justifying those not considered to be material, and review the inventory of material risks.
  • Establish and maintain an equivalence between subsidiaries' local taxonomies and the Group taxonomy.
  • Conduct a risk assessment of the Group's risk profile on an annual basis.
  • Supervise the risk management and control activities carried out by the first line of defence to ensure they conform to the established policies and procedures, bearing in mind the tasks specifically assigned to it, and identify potential improvements within risk management.
  • The Validation division gives opinions regarding the suitability of new proposals, changes or adjustments to models, tools and processes with material methodological components. It also designs and rolls out the model risk management and control framework and monitors the Group's model risk profile.
  • The Compliance division identifies and periodically assesses compliance risks in the different areas of activity.
• Third line of defence: helps the Group to achieve its objectives, carrying out verification activities and providing independent and objective advice. Provides regular oversight of governance processes and of the established risk management and internal control activities.

4.4 Management and monitoring of the main material risks

The most salient aspects concerning the management of the first-tier risks identified in Banco Sabadell Group's risk taxonomy and concerning the actions taken in this regard in 2024 are set out below:

4.4.1 Strategic risk

Strategic risk is associated with the risk of losses or negative impacts materialising as a result of strategic decisions or their subsequent implementation. It also includes the inability to adapt the Group's business model to changes in the environment in which it operates.

The Group develops a Strategic Plan which sets out the Bank's strategy for a specified period of time. In 2021, Banco Sabadell defined a new Strategic Plan which sets out the key courses of action and transformation for each business line over the coming years, in order to seize the opportunity of consolidating its position as a major domestic bank.

As part of the Strategic Plan, the Group carries out five-year financial projections, which are the result of the implementation of the strategies defined in the Plan. These projections are carried out on the basis of the most likely economic scenario for the key geographies (baseline scenario) and they are also included in the ICAAP as a baseline scenario. The economic scenario is described in terms of the key risk factors impacting the Group's income statement and balance sheet. In addition, the Plan is regularly monitored in order to analyse the Group's most recent performance and changes in the environment, as well as the risks taken.

The projection exercises and their monitoring are integrated into management arrangements, as they set out the key aspects of the Group's medium- and long-term strategy. The Plan is drawn up at the business unit level, on the basis of which the Group manages its activities, and annual results are also assessed in terms of compliance with the risk appetite.

Strategic risk includes the management and control of four risks:

• Solvency risk: this is the risk of not having sufficient capital, in terms of either quality or quantity, to achieve strategic and business objectives, withstand operational losses or meet regulatory requirements and/or the expectations of the market in which the Institution operates.
• Business risk: this refers to the possibility of incurring losses as a result of adverse events that negatively affect the Institution's capacity to operate, either in the short term (viability) or in the medium term (sustainability), or to deliver healthy, recurrent profits.
• Reputational risk: current or future risk of the Bank's competitive capacity being negatively affected as a result of (i) actions or omissions, carried out by or attributed to the Group, Senior Management or its governing bodies, or (ii) maintaining business relationships with counterparties with poor reputation, resulting in a negative perception by its stakeholders (regulators, employees, customers, shareholders, investors and the general public).
• Environmental risk: risk of incurring losses as a result of the impacts, both those existing at present and those that may exist in the future, of environmental risk factors on counterparties or invested assets, as well as aspects affecting financial institutions as legal entities. Environmental factors are related to the quality and functioning of natural systems and resources, and include factors such as climate change and environmental degradation. Any one of them can have a positive or negative impact on the financial performance or solvency of an institution, sovereign state or individual. These factors can materialise mainly in physical aspects (effects of climate change and environmental degradation, including more frequent extreme weather events and gradual changes in weather patterns and in the balance of ecosystems) and transitional aspects (arising from processes to adjust to an environmentally sustainable economy, for example, lower emissions, greater energy efficiency and reduced consumption of natural resources, among others).

4.4.1.1 Solvency risk

Banco Sabadell's ratios are above the minimum capital requirements established by the European Central Bank (ECB). Therefore, the Group is not subject to any caps on the distribution of dividends, variable remuneration or coupon payments made to holders of AT1 capital instruments.

Banco Sabadell is also compliant with MREL, which coincides with supervisory expectations and is in line with its funding plans.

Details on the closing data as at 31 December 2024 for solvency risk and capital management are available in Note 5 to these consolidated annual financial statements.

4.4.1.2 Business risk

During 2024, global growth outperformed expectations, in an environment of stabilising inflation, which enabled central banks to start a series of interest rate cuts, although monetary authorities remained cautious and indicated that rate cuts would be subject to the performance of economic indicators. In addition, both the demand for credit and economic activity showed signs of improvement, with a better economic outlook for Spain, although some degree of deterioration can be seen in certain European countries, for example Germany.

On the other hand, this year was also marked by the publication, at the end of April, of BBVA's interest in a merger with Banco Sabadell, as well as the subsequent rejection by the Bank's Board of Directors. In response, in the month of May, BBVA issued a voluntary tender offer for the acquisition of 100% of Banco Sabadell's shares (see Note 1.5).

Instability lingered in the global geopolitical environment with a series of uncertainties and threats arising from the armed conflicts in Ukraine and the Middle East, as well as the result of the presidential elections in the United States, increasing the risk of a resurgence of trade and/or financial tensions on a global scale. Furthermore, there were increasing concerns over the sustainability of public finances in key economies, which heightened the probability of a more restrictive fiscal policy and episodes of instability.

Against this backdrop, in year-on-year terms, Banco Sabadell significantly increased its net earnings, driven by (i) sound core results, (ii) increased net interest income, (iii) reduced cost of risk, (iv) an active and growing commercial dynamic, and (v) contained growth of costs.

All these aspects are clearly reflected in the Group's improved profitability, shown by an improvement of its ROTE, which increased from 11.5% as at 31 December 2023 to 14.93% as at 31 December 2024.

4.4.1.3 Reputational risk

Banco Sabadell Group bases its business model on corporate values such as ethics, professionalism, rigour, transparency, quality and long-term business relationships that are beneficial to both the Group and its counterparties.

The Bank is aware that, since the last financial crisis, society in general has become more sensitive to the service offered by banking institutions and, in particular, to the service offered to vulnerable customers, who have gained more visibility as a result of regulatory developments aimed at protecting this cohort.

Given the cross-cutting nature of reputational risk, the Institution follows a holistic approach to identify, analyse and monitor reputational risk in each sphere of management of the risks to which it is exposed.

The Institution's reputation may be affected by not only its own banking activity, but also that of its counterparties (customers and suppliers) or third-party initiatives (media campaigns or partnerships) that could impact the Institution's reputation and the public perception of its brand. Therefore, for reputational risk management, the Institution takes into account several internal and external factors or events that enable any challenging situations that could have an impact on the Institution's reputation to be detected early.

4.4.1.4 Environmental risk

Banco Sabadell has adopted environmental commitments through a cross-cutting strategy (Sabadell's Commitment to Sustainability) and is moving closer to achieving them by rolling out various measures in the area of environmental risk laid down in the Bank's Sustainable Finance Plan. Both the commitments and the measures are aimed at complying with the wide range of regulatory requirements, supervisory expectations and voluntary initiatives adhered to by the Institution.

Banco Sabadell has mechanisms in place for identifying, managing, controlling and governing environmental risk. The Institution views it as a risk of a cross-cutting nature, which could affect the Institution as an additional risk driver to traditional banking risks (e.g. credit risk, market risk, liquidity risk, operational risk), where environmental risk is identified, managed and controlled.

It regularly carries out various assessments related to this risk, including the following: (i) a qualitative analysis of the impact of environmental risk factors on the aforesaid risks, (ii) a quantitative estimate of the impacts stemming from environmental risk on credit risk, market risk, liquidity risk and operational risk, (iii) a quantitative analysis of the exposure of its credit portfolios to the most carbon-intensive sectors, and (iv) a measurement of its sustainable exposure (green, social and sustainability-linked transactions). During this year, environmental risk indicators have continued to be defined and developed and are gradually being converted to metrics that are included in the Risk Appetite Framework in order to manage and monitor these risks.

It is worth mentioning that the Group has incurred no material losses relating to environmental risk in 2024 or before then, except for the financial impact stemming from the DANA emergency that took place in October 2024, mainly on credit risk (for more information, see Notes 4.1 and 4.4.2.5 to these annual financial statements). Furthermore, it should be noted that following a review of the qualitative assessment of the materiality of environmental risk factors on risks that could be significantly impacted, it was concluded that the potential impacts were concentrated in credit portfolios. Specifically, transition risks were found to be the most material, from the point of view of regulatory factors and technological change. While the shortterm impact was not very significant, the potential medium- and long-term impacts should continue to be monitored and assessed on an ongoing basis, depending on the sector.

Further information on environmental risk can be found in the Consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, S.A. and subsidiaries (Sustainability Report), which forms part of the consolidated Directors' Report.

4.4.2. Credit risk

Credit risk refers to the risk of incurring losses as a result of borrowers failing to fulfil their payment obligations, or of losses in value materialising due simply to the deterioration of borrowers' credit quality.

4.4.2.1 Credit risk management framework

Acceptance and monitoring

Credit risk exposures are rigorously managed and monitored through regular assessments of borrowers' creditworthiness and their ability to honour their payment obligations undertaken with the Group, adjusting the exposure limits established for each counterparty to levels that are deemed to be acceptable and also assessing environmental, social and governance factors. It is also normal practice to mitigate credit risk exposures by requiring borrowers to provide collateral or other guarantees to the Bank.

The Board of Directors grants powers and discretions to the Delegated Credit Committee to allow the latter in turn to delegate responsibilities to different decision-making levels. The implementation of authority thresholds in credit approval systems ensures that the conferral of approval powers established at each level is linked to the expected loss calculated for each transaction, also considering the total amount of the total risk exposure with an economic group and the amount of each transaction.

To optimise the business opportunities provided by each customer and guarantee an appropriate level of security, responsibility for accepting and monitoring risks is shared between the account manager and the risk analyst who, by maintaining effective communication, are able to obtain a comprehensive (360°) and forward-looking insight into each customer's individual circumstances and needs.

The account manager monitors the business aspect through direct contact with customers and by handling their day-to-day banking activity, while the risk analyst takes a more systematic approach making use of their specialised knowledge.

The implementation of advanced risk management methodologies benefits the process by allowing proactive measures to be taken once a risk has been identified. It is worth highlighting the use of tools such as credit ratings for business borrowers and credit scores for natural persons, as well as early warning indicators to monitor risks. These are integrated into a single tool that provides a comprehensive and forward-looking vision of customers.

The analysis of indicators and early warnings, in addition to credit rating reviews, allow credit risk quality to be measured continuously and in an integrated way. The establishment of efficient procedures to manage performing loans also benefits the management of past-due loans as it enables a proactive policy to be devised based on the early identification of any cases with propensity to default.

Risk monitoring is carried out for all exposures in order to identify potentially problematic situations and prevent credit impairment. In general, this monitoring is based on an early warnings system at both the transaction/borrower level and at the portfolio level, and both systems use the firm's internal information and external information to obtain results. Risk monitoring is carried out prior to any default and on a forward-looking basis, i.e. with an outlook based on the foreseeable future development of circumstances, in order to determine both actions to strengthen the business (increase lending) and to prevent risk (risk mitigation, improvement of guarantees, etc.).

The early warnings system allows credit risk quality to be measured in an integrated way and transferred, as necessary, to recovery management specialists, who determine the different types of procedures that should be implemented. Groups or categories are established for risks that exceed a given limit and according to predicted delinquency rates, so that they can be treated separately. These warnings are additionally managed by the account manager and the risk analyst.

Responsible lending

In accordance with the nature of the Group's financial transactions and in order to ensure suitable customer protection in banking services, policies and procedures are implemented in relation to the evaluation and granting of responsible loans and credits, in relation to which it is particularly worth mentioning the importance of the general principles governing responsible lending, as detailed in Annex 6 to Bank of Spain Circular 5/2012 of 27 June on transparency of banking services and responsible lending.

The Bank's internal regulations, reflected in the updated Group Credit Risk Granting and Monitoring Policy, approved by the Board of Directors on 27 June 2024, explicitly address the application of responsible lending principles when granting and monitoring various types of finance. This commitment is aligned with the guidelines established in the third paragraph of Article 29.1 of Law 2/2011 of 4 March on Sustainable Economy, and covers policies, methods and procedures designed to comply with applicable legislation, such as Order EHA/2899/2011 and Bank of Spain Circular 5/2012, specifically its Rule 12. Effective control mechanisms have also been implemented to ensure these policies are continuously monitored as part of the comprehensive credit risk management arrangements.

Management of non-performing exposures

The purpose of managing non-performing exposures is to find the best solution for the customer upon detecting the first signs of impairment, reducing the entry into default of customers with financial difficulties, ensuring intensive management and avoiding downtime between the different phases.

Generally, during stages of weakness in the economic cycle, debt refinancing and restructuring are the main risk management techniques used. The Bank's aim, when faced with debtors and borrowers that have, or are expected to have, financial difficulties to honour their payment obligations under the prevailing contractual terms, is to facilitate the repayment of the debt by reducing the probability of default as much as possible. A number of common policies to achieve this are in place in the Institution, as well as procedures for the approval, monitoring and control of potential debt forbearance (refinancing and restructuring) processes, the most significant of which are the following:

• The existence of a sufficiently long good payment history by the borrower and a manifest intention to repay the loan, assessing the period of time during which the customer is likely to continue to experience financial difficulties (in other words, whether they are facing short-term or long-term difficulties).
• Refinancing and restructuring conditions based on a realistic repayment schedule that is in line with borrowers' current and expected payment capacity, also taking into account the macroeconomic situation and outlooks, avoiding their postponement to a later date.
• If new guarantees are provided, these must be regarded as a secondary and exceptional means of recovering the debt, so as to avoid adversely affecting existing means. In any case, the ordinary interest accrued should be paid up to the refinancing or restructuring date.
• Limits are applied to the length of grace periods and to the granting of successive refinancing.

The Group continually monitors compliance with the agreed terms and with the above policies. Furthermore, the Group has an advanced model in place for managing non-performing exposures in the impaired assets portfolio.

For further quantitative information, see Schedule IV "Other risk information - Credit risk exposure: Forbearance" to these consolidated annual financial statements.

Internal risk models

Banco Sabadell Group also has a system in place which is made up of three lines of defence to ensure the quality and oversight of internal models, as well as a governance process specifically designed to manage and monitor these models and to ensure compliance with regulations and the supervisor's instructions.

The governance framework of internal credit risk and impairment models (management of risk, calculation of regulatory capital and provisions) is based on the following pillars:

• Effective management of changes to internal models.
• Ongoing monitoring of the performance of internal models.
• – Regular reporting, both internal and external.
• Management tools for internal models.

One of the main bodies within the governance framework of internal credit risk and impairment models is the Models Committee, which meets on a monthly basis and has internal approval responsibilities, depending on the materiality of the risks, and which also monitors internal credit risk models.

Real estate credit risk management

As part of its general policy on risks and, in particular, its policy on the real estate development sector, the Group has a number of specific policies in place for mitigating risks.

The main measure that is implemented in this portfolio is the ongoing monitoring of projects, both during the construction phase and once the works have been completed. This monitoring makes it possible to validate the progress made, ensuring everything is moving forward as planned, and to take action in the event of any possible deviations. The aim at all times is for the available funding to be sufficient to complete the works and for the existing sales to be able to significantly reduce the risks. The Bank has established three strategic courses of action:

– New lending: real estate development business

New lending to developers is governed by a "Real Estate Development Framework", which defines the optimal allocation of the new business on the basis of the quality of the customer and development project. This analysis is based on models that allow an objective appraisal to be obtained, taking into account the views of real estate experts.

To this end, the Bank has:

• The Real Estate Business division (a unit within the Business Banking division), with a team of real estate specialists who exclusively manage the Bank's developer customers. This unit has an acceptance and monitoring methodology that allows the Group to gain in-depth knowledge about all the projects analysed by the unit.
• Two Real Estate Investment Analysis and Monitoring divisions (reporting to the RE Developer Risk division), whose role is to analyse all real estate projects from a technical and real estate point of view. They analyse both the location and suitability of the product, as well as the potential supply and demand. They also compare them against the figures of the business plan submitted by the customer (particularly costs, income, margin and timelines). This analysis process goes hand in hand with a model used to track real estate developments through monitoring reports, which validate the progress made in each development project in order to keep track of drawdowns and compliance with the business plan (income, costs and timelines).
• The Real Estate Risk division, with specialised analysts at the Territorial Division. This makes it possible to ensure that newly accepted risks are in line with the policies and acceptance framework for this type of risk.
• Management of non-performing real estate credit

Non-performing exposures are managed in line with the defined policy. In general, they are managed taking into account:

• The customer.
• The guarantees.
• The status of the loan (from the time when a warning is triggered, warning of a potential deterioration of the current status, up until refinancing or restructuring takes place, or until the properties are surrendered in payment of debt (payment in kind)/purchased in an amicable settlement/settlement with debt reduction, or until an auction is held following a mortgage enforcement process and whenever there is a ruling in favour of foreclosure).

After analysing the three aforementioned aspects, an optimal solution is sought to stabilise or settle the position (whether through an amicable settlement or through judicial proceedings), which differs depending on the evolution of each customer/case.

Cases in which the stabilisation of the loan or its settlement by the customer is not a feasible option are managed using support models depending on the type of loan or financed item.

In the case of completed real estate developments or completed non-residential properties, these can be put on sale at prices that drive market traction.

For other funded real estate, the possibility of entering into sale agreements with third parties is considered, out-of-court settlement solutions are proposed (purchase, payment in kind, which in the case of properties owned by individuals can be arranged under favourable conditions for relocation or social rental depending on the needs of the customer, or with a settlement with debt reduction), or else court proceedings are initiated.

– Management of foreclosed assets

Once the loan has been converted into a real estate asset, a management strategy is defined depending on the type of asset, in order to maximise the potential of each asset during the sale.

The main disposal mechanism is the sale of the asset, for which the Bank has developed different channels depending on the type of property and customer.

The Group, which has had high concentrations of this type of risk in the past, has a first-tier RAS metric in place which establishes a maximum level of concentration of exposures associated with real estate development based on Tier 1 capital in Spain. This metric is monitored on a monthly basis and reported to the Technical Risk Committee, the Board Risk Committee and the Board of Directors.

Lastly, it is worth highlighting that the Risk Control division, together with the Business and Risk Management divisions, regularly monitors the adequacy of new loans granted to real estate developers. The monitoring process includes a review of compliance with policies and asset allocation. The results of this monitoring exercise are escalated to the Technical Risk Committee for information.

For further quantitative information, see Schedule IV "Other risk information – Concentration risk: Exposure to construction and real estate development sector" to these consolidated annual financial statements.

Environmental risk management associated with credit risk

Environmental risk is one of the three aspects assessed as part of Environmental, Social and Governance (ESG) risks and includes both climate risk, which is in turn subdivided into climate-related transition risk and climate-related physical risk, and environmental degradation risk (see Note 4.4.1.4 - Environmental risk).

Banco Sabadell has a set of tools in place facilitating the integration of environmental risks in credit risk management and control arrangements, most notably the ESG Guidelines, which are the only ESG credit risk management framework and comprise the rules that are currently applied to the granting of credit transactions, encompassing:

• An environmental and social risk framework at the customer level: to identify from the outset whether a new transaction could be associated with any of the restricted activities.
• A Climate-related and Environmental Risk Indicator (CERI, or IRCA by its Spanish acronym): an indicator that allows the Institution to distinguish between the ESG risk of the companies to which it grants finance, taking into account their performance when managing climate risks, environmental degradation risks, environmental controversies, and social and governance risks. It is used to define ESG credit risk management policies and to identify potential opportunities for investment to support emissions-intensive companies in their transition towards more sustainable activities.
• Decarbonisation pathways: for borrowers operating in sectors affected by the decarbonisation pathways defined by the Group, the Institution evaluates the suitability and the alignment of their activities, starting as soon as they are originated.

Thus, it is worth noting that the CERI includes, as part of an integrated assessment, a modular assessment of climate-related transition risk and physical risk, of environmental degradation risk, and of controversies, of both an environmental and social or governance nature, of the counterparties. The process to assess climate-related and environmental risk through the CERI of the borrowers in question can be done in two ways.

i. A top-down approach of climate risk and environmental degradation risk models, which is conducted for, and applied to, the entire loan book. Its output is an environmental performance rating obtained through a model, the automated CERI, which aggregates in a single assessment the outcomes, at the modular level, of climate-related transition and physical risks and environmental degradation risk assessments. This simplified, more automated approach is applied to companies not subject to non-financial disclosure requirements or that currently do not have an advanced CERI analysis.

ii. A bottom-up approach, which applies to large enterprises subject to non-financial disclosure requirements through the advanced CERI. The advanced CERI is a numerical indicator that, with the same modular structure and approach as the automated CERI, enables the categorisation of borrowers according to their impact associated with climate-related and environmental risks, taking into account the management, attitude, specific characteristics and progress made by the borrower in this regard, supplemented by an analysis of any controversies associated with the borrower.

As regards the inclusion of environmental risks in the calculation of the expected loss, through the PD, the Institution adjusts the ratings of large enterprises when the Climate-related and Environmental Risk Indicator, explained above, is classified as high or when the counterparty is involved in significant controversies that have not been mitigated. It is thus included directly, as the rating is an input of the expected loss parameters (specifically, the PD).

Furthermore, in order to reflect the impact of these risks in the appraisal values of loan book collateral, the Institution applies adjustments that lower the appraisal value. In the case of physical risk, this adjustment reflects, for each collateral item, the level of its deterioration in the event of flood, fire or water stress, as well as the probability of occurrence of this event. In the case of transition risk, the appraisal value is lowered for collateral with an energy rating below D.

The methodology used for the aforementioned collateral adjustments coincides with that applied in the topdown approach described above, i.e. based on an internal methodology for the quantitative assessment of climate-related physical risk where a differentiation is made between acute and chronic events in line with the three scenarios of Orderly Transition, Disorderly Transition and Hot House World of the Network for Greening the Financial System (NGFS) adapted to a 30-year time horizon. This makes it possible to assess physical risk drivers that could have a more significant impact on the portfolio, based on the location and activities of customers.

For further details, see section "5.1. Environmental: Climate change" in the Sustainability Report.

4.4.2.2. Risk management models

Credit ratings

Credit risks incurred with corporates, real estate developers, specialised lending projects, financial institutions and countries are rated using a rating system. The rating model estimates the risk rating in the medium term, based on qualitative information provided by risk analysts, financial statements and other relevant information. The rating system is based on factors that predict the probability of default over a oneyear period. It has been designed for different segments.

This rating model is reviewed annually based on the analysis of actual delinquency performance patterns. An estimated delinquency rate is assigned to each internal credit rating level, which also allows a uniform comparison to be made against other segments and ratings issued by external credit rating agencies using a master ratings scale.

Credit ratings have a variety of uses in risk management. Most notably, they form part of the transaction approval process (system of discretions), risk monitoring and pricing policies.

The percentage distribution by credit rating of Banco Sabadell's portfolio of companies as at 31 December 2024 and 2023 is detailed below:

%
Distribution, by credit rating, of Banco Sabadell's portfolio of companies 2024
9	8	7	6	5	4	3	2	1	0	TOTAL
1.84%	3.89%	8.58%	18.12%	25.15%	21.25%	13.84%	5.31%	1.87%	0.13%	100%

In this scale of 0 to 9, probability of default (PD) goes from high to low. The PD used is the risk management PD.

%
						Distribution, by credit rating, of Banco Sabadell's portfolio of companies 2023
9	8	7	6	5	4	3	2	1	0	TOTAL
0.80%	2.20%	8.90%	24.40%	28.14%	19.69%	11.58%	3.69%	0.53%	0.06%	100%

In this scale of 0 to 9, probability of default (PD) goes from high to low. The PD used is the risk management PD.

Credit scores

The tools designed to assess the probability of default of debtors who are natural persons are credit scoring systems, which are in turn based on quantitative modelling of historical statistical data, where the relevant predictive factors are identified. In geographical areas where credit scoring takes place, credit scores are divided into two types:

• Reactive credit scores: these are used to assess applications for consumer loans, mortgage loans and credit cards. Once all of the data relating to the transaction has been entered, the system calculates a result based on the estimated borrowing power, financial profile and, if applicable, the profile of assets pledged as collateral. The resulting credit score is integrated into risk management processes using the system of discretions.
• Behavioural credit scores: the system automatically classifies all customers using information regarding their activity based on their financial situation (balances, activity, non-payments), their personal characteristics and the features of each of the products that they have acquired. These credit scores are mainly used to authorise transactions, establish (authorised) overdraft limits, design advertising campaigns and adjust the initial stages of the debt recovery management process.

The percentage distribution by behavioural score of Banco Sabadell's portfolio of individuals (retail customers) as at 31 December 2024 and 2023 is detailed below:

%
Distribution, by behavioural score, of Banco Sabadell's portfolio of individuals 2024
9	8	7	6	5	4	3	2	1	0	TOTAL
1.23%	8.38%	27.51%	38.6%	16.28%	4.6%	1.92%	0.87%	0.41%	0.20%	100%
In this scale of 0 to 9, probability of default (PD) goes from high to low. The PD used is the risk management PD.

%

Distribution, by behavioural score, of Banco Sabadell's portfolio of individuals 2023
9	8	7	6	5	4	3	2	1	0	TOTAL
0.99%	7.74%	26.28%	35.61%	17.67%	6.73%	2.64%	1.33%	0.66%	0.35%	100%
In this scale of 0 to 9, probability of default (PD) goes from high to low. The PD used is the risk management PD.

Warning tools

In general, the Group has a system of warning tools in place, which include both individual warnings and advanced early warning models for both the Business Banking and Retail Banking customer segments. These warning tools are based on performance factors obtained from available sources of information (credit ratings or credit scores, customer files, balance sheets, CIRBE (Bank of Spain Central Credit Register), information relating to the industry or past banking activity, etc.). They measure the risk associated with the customer on a short-term basis (prediction of arrears), obtaining a high level of predictability to detect potential delinquent customers. The resulting rating or score, which is obtained automatically, is used as a basic input when monitoring the risk of customers in the retail and business segments.

This warnings system enables:

• Efficiency to be improved, as monitoring exercises focus on customers with the lowest credit rating or credit score (different cut-off points for each group).
• Proactive management in the event of any negative change in the situation of the customer (change in rating/score, new severe warnings, etc.).
• Customers whose situation remains unchanged and who have been assessed by the Basic Management Team to be regularly monitored.

4.4.2.3. Credit risk exposure

The table below shows the distribution, by headings of the consolidated balance sheet and off-balance sheet exposures, of the Group's maximum gross credit risk exposure as at 31 December 2024 and 2023, without deducting collateral or credit enhancements received in order to ensure the fulfilment of payment obligations, broken down by portfolios and in accordance with the nature of the financial instruments:

Thousand euro
Maximum credit risk exposure	Note	2024	2023
Financial assets held for trading		1,420,956	142,495
Equity instruments	9	541,005	—
Debt securities	8	879,951	142,495
Non-trading financial assets mandatorily at fair value through profit or loss		168,267	153,178
Equity instruments	9	67,049	52,336
Debt securities	8	60,705	65,744
Loans and advances	11	40,513	35,098
Financial assets at fair value through other comprehensive income		6,492,101	6,387,869
Equity instruments	9	315,768	302,510
Debt securities	8	6,176,333	6,085,359
Financial assets at amortised cost		199,367,960	184,116,175
Debt securities	8	24,876,300	21,501,203
Loans and advances	11	174,491,660	162,614,972
Derivatives	10, 12	4,412,901	4,988,592
Total credit risk due to financial assets		211,862,185	195,788,309
Loan commitments given	26	28,775,335	27,035,812
Financial guarantees given	26	1,979,622	2,064,396
Other commitments given	26	9,366,339	7,942,724
Total off-balance sheet exposures		40,121,296	37,042,932
Total maximum credit risk exposure		251,983,481	232,831,241

Schedule IV to these consolidated annual financial statements shows quantitative data relating to credit risk exposures, broken down by geographical area and by activity sector.

4.4.2.4. Credit risk mitigation

Credit risk exposures are rigorously managed and monitored through regular assessments of borrowers' creditworthiness and their ability to honour their payment obligations undertaken with the Group, adjusting the exposure limits established for each counterparty to levels that are deemed to be acceptable and also assessing environmental, social and governance factors. It is also normal practice to mitigate credit risk exposures by requiring borrowers to provide collateral or other guarantees to the Bank.

Generally, these take the form of collateral, mainly mortgages on properties used as housing, whether completed or under construction. The Group also accepts, although to a lesser degree, other types of collateral, such as mortgages on retail properties, industrial warehouses, etc., as well as financial assets. Another credit risk mitigation technique commonly used by the Institution is the acceptance of guarantors, in this case subject to the guarantor presenting a certificate of good standing.

All of these mitigation techniques are established ensuring their legal certainty, i.e. under contracts that are legally binding on all parties and which are legally enforceable in all relevant jurisdictions, thus guaranteeing the possibility of liquidating the collateral at any time. The entire process is subject to an internal verification of the legal enforceability of the contracts, and legal opinions of international specialists can be requested and applied where the contracts have been entered into under foreign legislation.

All collateral is executed before a notary through a public document, thus ensuring its enforceability before third parties. In the case of property mortgages, these public documents are also filed with the corresponding land registries, thus gaining constitutive effect before third parties. In the case of pledges, the pledged items are generally deposited with the Institution. Unilateral cancellation by the obligor is not permitted, and the guarantee remains valid until the debt has been fully repaid.

Personal guarantees or sureties are established in favour of the Institution and, except in certain exceptional cases, these are also executed before a notary through a public document, to vest the agreement with the highest possible legal certainty and to allow legal claims to be filed through executive proceedings in the event of non-payment. They constitute a credit claim with respect to the guarantor that is irrevocable and payable on first demand.

The Group has not received any significant guarantees which it is authorised to sell or pledge, irrespective of any non-payment by the owner of the referred guarantees, except for those intrinsic in treasury activities, which are mostly reverse repos (see Note 6). The fair value of the assets sold in connection with reverse repos is included under the heading "Financial liabilities held for trading" as part of the short positions of securities.

Assets assigned under the same transactions amount to 1,370,354 thousand euros as at 31 December 2024 (1,012,508 thousand euros as at 31 December 2023) and are included by type under the repos heading in Notes 18 and 19.

There have been no significant changes in Banco Sabadell's policies on the topic of guarantees during this year. Neither have there been any significant changes in the quality of the Group's guarantees with respect to the preceding year.

The values of the guarantees received to ensure collection, broken down into collateral and other guarantees, as at 31 December 2024 and 2023 are as follows:

Thousand euro
	2024	2023
Value of collateral	96,057,447	94,323,862
Of which: securing stage 2 loans	6,133,795	7,180,750
Of which: securing stage 3 loans	1,570,540	1,873,003
Value of other guarantees	14,262,388	14,975,715
Of which: securing stage 2 loans	1,653,150	1,881,539
Of which: securing stage 3 loans	683,329	1,054,019
Total value of guarantees received	110,319,835	109,299,577

The main risk concentration in relation to all of these types of collateral and credit enhancements corresponds to the use of mortgage guarantees as a credit risk mitigation technique in exposures of loans intended for the financing or construction of housing or other types of real estate. On a like-for-like basis, as at 31 December 2024, the exposure to home equity loans and credit lines represented 56.8% of total gross performing lending items granted to customers (57.5% as at 31 December 2023).

In addition, the Bank has carried out six synthetic securitisation transactions since 2020. Details of the outstanding transactions as at 2024 year-end are shown below:

• In December 2024, the Bank carried out one synthetic securitisation transaction of a 1.23 billion US dollar portfolio of project finance and loans to large corporates, having received an initial guarantee from Sabadell Hermes 1-2024 Designated Activity Company for 111 million US dollars, which covers losses of up to 9.0% on the securitised portfolio.
• In June 2024, the Bank carried out one synthetic securitisation transaction of a 1.1 billion euro portfolio of project finance loans, having received an initial guarantee from Sabadell Boreas 2-2024 Designated Activity Company for 110 million euros (105 million as at 31 December 2024), which covers losses of up to 10.0% on the securitised portfolio.
• In September 2023, the Bank carried out one synthetic securitisation of a 1,139 million euro portfolio of loans to SMEs and mid-corporates, having received an initial guarantee from Sabadell Galera 3-2023 Designated Activity Company in the amount of 58 million euros (45 million as at 31 December 2024), covering losses of between 0.95% and 5.05% on the securitised portfolio.
• In September 2022, the Bank carried out one synthetic securitisation transaction of a 1 billion euro portfolio of project finance loans, having received an initial guarantee from Sabadell Boreas 1-2022 Designated Activity Company in the amount of 105 million euros (65 million as at 31 December 2024), which covers losses of up to 10.5% on the securitised portfolio.

– In September 2021, the Bank carried out one synthetic securitisation of a 1.5 billion portfolio of loans to SMEs and mid-corporates, having received an initial guarantee of 75 million euros (38 million as at 31 December 2024), covering losses of between 0.9% and 5.9% on the securitised portfolio.

These transactions do not meet the requirements of the accounting standards for derecognising assets in securitised portfolios from the consolidated balance sheet.

These transactions are given preferential treatment for capital consumption purposes, in accordance with Article 26 of Regulation (EU) 2021/557, with the exception of the transaction carried out in December 2024 (see Note 5).

In the case of market transactions, counterparty credit risk is managed as explained in section 4.4.2.8 of these consolidated annual financial statements.

4.4.2.5. Calculation of credit loss allowances

The Group applies the criteria described below to calculate credit loss allowances.

The amount of impairment allowances is calculated based on whether or not there has been a significant increase in credit risk since initial recognition, and on whether or not a default event has occurred. This way, the impairment allowance for transactions is equal to:

• 12-month expected credit losses, where the risk of a default event materialising has not significantly increased since initial recognition (assets classified as stage 1).
• Lifetime expected credit losses, if the risk of a default event materialising has increased significantly since initial recognition (assets classified as stage 2).
• Expected credit losses, where a default event has materialised (assets classified as stage 3).

12-month expected credit losses are defined as:

$$PE_{12M} = EAD_{12M} \cdot PD_{12M} \cdot LGD_{12M}$$

Where:

EAD12M is the exposure at default at 12 months, PD12M is the probability of a default occurring within 12 months and LGD12M is the expected loss given default.

Lifetime expected credit losses are defined as:

$$PE_{LT} = \sum_{i=1}^{m} \frac{EAD_i \cdot PD_i \cdot LGD_t}{(1 + EIR)^{i-1}}$$

Where:

EADⁱ is the exposure at default for each year, taking into account both the entry into default and the (agreed) amortisation, PDⁱ is the probability of a default occurring within the next twelve months for each year, LGDⁱ is the expected loss given default for each year, and EIR is the effective interest rate of each transaction.

During this estimation process, a calculation is made of the allowance necessary to cover, on one hand, the credit risk attributable to the borrower in question and, on the other hand, country risk.

The Group includes forward-looking information when calculating expected losses and determining whether there has been a significant increase in credit risk, using scenario forecasting models to this end.

The agreed amortisation schedule for each transaction is used. Subsequently, these expected credit losses are updated by applying the effective interest rate of the instrument (if its contractual interest rate is fixed) or the contractual effective interest rate ruling on the date of the update (if the interest rate is variable). The amount of effective guarantees received is also taken into account.

The following sections describe the different methodologies applied by the Group to determine impairment loss allowances:

Individual allowance estimates

The Group monitors credit risk on an individual basis for all risks deemed to be significant. To estimate the individual allowance for credit risk, an individual estimate is made for all individually significant borrowers classified as stage 3 and for certain borrowers classified as stage 2. Individual estimates are also made for transactions identified as having negligible risk classified as stage 3.

The Group has developed a methodology to estimate these allowances, calculating the difference between the gross carrying amount of the transaction and the present value of the estimated cash flows it expects to receive, discounted using the effective interest rate. To this end, effective guarantees received are taken into account (see the section entitled "Guarantees" of Note 1.3.4.1.2).

Three methods are established to calculate the recoverable amount of assets assessed individually:

• Discounted cash flow method (going concern): debtors who are estimated to be able to generate future cash flows through their own business activity, thereby allowing them to fully or partially repay the debt owed through the performance of their business activity and the economic and financial structure of the company. This involves estimating the cash flows obtained by the borrower during the course of their business activity.
• Collateral recovery method (gone concern): debtors who are not able to generate cash flows during the course of their own business activities and who are forced to liquidate assets in order to fulfil their payment obligations. This involves estimating cash flows based on the enforcement of guarantees.
• Combined method: debtors who are estimated to be able to generate future cash flows and also have non-core assets. These cash flows can be supplemented with potential sales of non-core assets, insofar as they are not required for the performance of their activity and, consequently, for the generation of the aforesaid future cash flows.

Collective allowance estimates

Exposures that are not assessed using individual allowance estimates are subject to collective allowance estimates.

When calculating collective impairment losses, the Group, in accordance with IFRS 9, mainly takes the following aspects into account:

– The impairment estimation process takes all credit exposures into account. The Group recognises an impairment loss equal to the best estimate available from internal models, taking into account all of the relevant information which it holds on the existing conditions at the end of the reported period. For some types of risk, including sovereign risk and exposures with credit institutions and general governments of countries in the European Union and other advanced economies, the Group does not use internal models. These exposures are considered to have negligible risk given that, based on the information available as at the date of signing off the consolidated annual financial statements, and considering past experience with these risks, the impairment allowance that these exposures are estimated to require is not significant as long as they are not reclassified into stage 3.

– In order to collectively assess impairment, internal models estimate a different PD and LGD for each contract. To that end, various types of historical information are used that allow the risk to be individually classified for each exposure (ratings, non-payments, vintage, exposure, collateral, characteristics of the borrower or contract). Available historical information representative of the Institution and past losses (defaults) is therefore taken into account. It is worth highlighting that the estimation obtained from the models is adjusted to account for the existing economic climate and the forecasts in the scenarios considered, the latter being representative of expected credit losses. The estimates of impairment loss allowance models are directly integrated in some activities related to risk management and the input data that they use (e.g. credit ratings and credit scores) are those used for approving risks, monitoring risks, for pricing purposes and in capital calculations. In addition, recurring back-testing exercises are carried out at least once a year, and the models are adjusted in the event any significant deviations are detected. The models are also reviewed regularly in order to incorporate the most recent information available and to ensure that they perform adequately and that they are suitably representative when applied to the current portfolio for the calculation of impairment loss allowances.

Segmentation of models

Specific models exist depending on the segment or product of the customer (portfolio) and each one uses explanatory variables that uniformly catalogue all of the portfolio's exposures. The purpose of the segmentation of models is to optimise the capture of customers' default risk profile based on a set of common risk drivers. Therefore, the exposures of these segments can be considered to reflect a uniform collective treatment.

The models for companies calculate PD at the borrower level and are fundamentally segmented according to the size of the company (annual turnover).

The PD models for natural persons, including the self-employed, follow a segmentation that centres primarily on the lending product. Models broken down by product are available: mortgage and consumer loans, taking into account the purpose of the transaction (individual or business), credit cards and lines of credit. PDs are estimated at the contract level, meaning that a single borrower can have different PDs depending on the lending product being quantified.

The models for Significant Increase in Credit Risk (SICR) carry out calculations at the contract level, in order to consider the characteristics specific to each transaction at the time of origination and at the present time.

Where LGD is concerned, contracts with similar risk characteristics are grouped together for collective assessment, using the following segmentation hierarchy:

• By type of borrower: companies, developers and natural persons.
• By type of guarantee: mortgage, unsecured, monetary/financial, and guarantors.
• By type of product: credit cards, overdrafts, leases, credits and loans.

Different LGDs are estimated for each segment, which are representative of the borrowers, of the recovery processes and of the recoverability assigned to each one based on the Institution's past experience.

Risk drivers

The risk drivers or explanatory variables of models are the shared credit risk characteristics. In other words, they are common elements that can be used to rate borrowers in a homogeneous way within a portfolio and which explain the credit risk rating assigned to each exposure. Risk drivers are identified by means of a rigorous process that combines historical data analysis, explanatory power and expert judgment, as well as knowledge about the risk/business.

The main risk drivers are presented here below, grouped together by type of model (PD, SICR and LGD).

PD models use credit ratings or credit scores as input data (Internal Ratings-Based (IRB) models used for both risk management and capital calculations). They incorporate additional information to give a more faithful reflection of the risk at a given moment in time (point-in-time). For companies, the early warnings tool known as HAT and the credit rating are used. For individuals, the behavioural credit score is used. A description of these tools can be found earlier in this same note.

In both cases, other recent risk deterioration events (refinancing, exit from default status, non-payments, lending restrictions) also explain the probability of default.

The SICR models mainly use as an explanatory factor the ratio between the residual lifetime PD at the time of approval (i.e. for the residual life of the transaction but using the information existing at the time the transaction is originated) and the current lifetime PD (using the information existing at the present time).

LGD models use additional risk drivers that enable a more in-depth segmentation to take place. More specifically, for mortgage guarantees, the Loan-to-Value (LTV) is used, or the order of priority in the event the mortgage guarantee is enforced. Similarly, the amount of debt and the type of product are also factors taken into account.

For those borrowers included within business in Spain whose coverage has been assessed using internal models as at 31 December 2024 and 2023, the following tables show the breakdown by segment of the average EAD-weighted PD and LGD parameters, distinguishing between on-balance sheet and off-balance sheet exposures, and the stage in which the transactions are classified according to their credit risk:

				31/12/2024
					Average ECL parameters for on-balance sheet exposures
	Stage 1		Stage 2		Stage 3		Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Loans and advances	0.60 %	21.80 %	22.30 %	22.70 %	100.00 %	58.40 %	3.60 %	22.40 %
Other financial corporations	0.40 %	27.40 %	9.30 %	31.40 %	100.00 %	61.30 %	0.70 %	27.50 %
Non-financial corporations	0.80 %	29.20 %	15.70 %	27.00 %	100.00 %	60.70 %	3.90 %	29.60 %
Households	0.40 %	15.80 %	33.10 %	15.70 %	100.00 %	56.20 %	3.40 %	16.50 %

%

				31/12/2024
	Average ECL parameters for off-balance sheet exposures
	Stage 1 Stage 2 Stage 3 Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Loans and advances	0.70 %	36.80 %	15.50 %	35.00 %	100.00 %	83.90 %	1.10 %	36.80 %
Other financial corporations	0.90 %	30.30 %	26.10 %	27.90 %	100.00 %	12.00 %	1.00 %	30.30 %
Non-financial corporations	0.70 %	29.70 %	14.50 %	34.60 %	100.00 %	85.10 %	1.20 %	29.90 %
Households	0.60 %	58.50 %	23.30 %	37.50 %	100.00 %	60.00 %	0.90 %	58.30 %

%

				31/12/2023
	Average ECL parameters for on-balance sheet exposures
	Stage 1		Stage 2		Stage 3		Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Loans and advances	0.70 %	23.20 %	21.50 %	23.90 %	100.00 %	59.90 %	4.10 %	24.00 %
Other financial corporations	0.70 %	27.10 %	8.90 %	30.20 %	100.00 %	67.80 %	1.10 %	27.20 %
Non-financial corporations	1.20 %	32.00 %	15.40 %	28.20 %	100.00 %	63.80 %	4.50 %	32.20 %
Households	0.40 %	16.40 %	29.80 %	18.00 %	100.00 %	56.90 %	3.90 %	17.30 %

%

				31/12/2023
	Average ECL parameters for off-balance sheet exposures
		Stage 1 Stage 2 Stage 3 Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Loans and advances	1.00 %	38.80 %	16.80 %	38.40 %	100.00 %	77.20 %	1.60 %	38.90 %
Other financial corporations	1.40 %	35.60 %	1.80 %	35.50 %	0.00 %	0.00 %	1.40 %	35.60 %
Non-financial corporations	1.10 %	32.70 %	17.00 %	38.20 %	100.00 %	77.80 %	1.90 %	33.00 %
Households	0.70 %	59.60 %	15.50 %	40.80 %	100.00 %	58.00 %	0.90 %	59.30 %

During 2024, the usual model maintenance processes have been continued, as have the independent reviews conducted by the internal control units (Models Validation and Internal Audit). The adjustment processes follow the internal governance arrangements established for their validation, review and approval by the corresponding units.

Details of the PD and LGD parameters for exposures in the business of the subsidiary TSB as at 31 December 2024 and 2023 are shown below:

%
				31/12/2024
					Average ECL parameters for on-balance sheet exposures
	Stage 1		Stage 2		Stage 3		Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Secured loans	0.21 %	5.81 %	8.47 %	2.67 %	100.00 %	2.33 %	1.95 %	5.70 %
Credit cards	0.81 %	90.15 %	10.48 %	74.34 %	100.00 %	46.39 %	4.53 %	87.96 %
Current accounts	0.46 %	57.95 %	5.80 %	47.19 %	100.00 %	56.18 %	3.57 %	57.33 %
Loans	2.30 %	86.99 %	17.89 %	87.75 %	100.00 %	83.18 %	6.15 %	86.93 %

%

				31/12/2024
					Average ECL parameters for off-balance sheet exposures
	Stage 1		Stage 2		Stage 3			Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Secured loans	0.21 %	5.81 %	8.47 %	2.67 %	100.00 %	2.33 %	1.95 %	5.70 %
Credit cards	0.81 %	90.15 %	10.48 %	74.34 %	100.00 %	46.39 %	4.53 %	87.96 %
Current accounts	0.46 %	57.95 %	5.80 %	47.19 %	100.00 %	56.18 %	3.57 %	57.33 %
Loans	2.30 %	86.99 %	17.89 %	87.75 %	100.00 %	83.18 %	6.15 %	86.93 %

%

				31/12/2023
	Average ECL parameters for on-balance sheet exposures
	Stage 1		Stage 2		Stage 3		Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Secured loans	0.26 %	2.71 %	7.88 %	7.52 %	100.00 %	4.02 %	1.53 %	4.42 %
Credit cards	1.38 %	81.64 %	9.19 %	80.67 %	100.00 %	59.96 %	5.01 %	80.88 %
Current accounts	0.46 %	54.39 %	8.71 %	55.14 %	100.00 %	56.87 %	3.56 %	54.50 %
Loans	3.89 %	86.81 %	12.75 %	87.23 %	100.00 %	84.14 %	7.63 %	86.79 %

%

				31/12/2023
	Average ECL parameters for off-balance sheet exposures
	Stage 1	Stage 2	Stage 3			Total portfolio
	PD	LGD	PD	LGD	PD	LGD	PD	LGD
Secured loans	0.58 %	4.49 %	7.88 %	7.52 %	100.00 %	4.02 %	0.58 %	4.49 %
Credit cards	1.38 %	81.64 %	9.19 %	80.67 %	100.00 %	59.96 %	5.01 %	80.88 %
Current accounts	0.46 %	54.39 %	8.71 %	55.14 %	100.00 %	56.87 %	3.56 %	54.50 %
Loans	3.89 %	86.81 %	12.75 %	87.23 %	100.00 %	84.14 %	7.63 %	86.79 %

The PD of secured loans was calibrated in 2024, resulting in customers with a good credit record being reclassified from stage 2 to stage 1, which in turn led to an increase in the average PD for those in stage 2.

Inclusion of forward-looking information in expected loss models

The Group has considered three macroeconomic scenarios: one baseline scenario, the most likely of all (65%); alternative scenario 1, which is more optimistic and envisages productivity gains and non-existent inflation (15%); and alternative scenario 2, which is more adverse and envisages financial instability and recession (20%). In 2023, the Group considered three macroeconomic scenarios with weights of 60%, 10% and 30%, respectively, and the same macroeconomic variables as in 2024. In the case of TSB, the same probabilities as in 2023 are maintained, i.e. the probabilities of the baseline scenario and of the best-case scenario are reduced to 60% and 10%, respectively, assigning a 10% probability to a more adverse scenario characterised by interest rate hikes. To carry out the forecasts of these scenarios, five-year time horizons are used. The main variables considered are changes in GDP, the unemployment rate and house prices.

Baseline scenario

• Uncertainty and Trump's protectionist policies impact global economic growth. Trump's arrival at the White House compounds other structural factors that act as a drag, including the following: (i) the turbulent geopolitical environment and its consequences on international trade and value chains, (ii) structural weaknesses of economies such as China, Germany and Italy, and (iii) the fiscal situation of some large, developed economies, especially the United States, France and Italy. The labour market shows a more even balance between supply and demand for jobs.
• Growth in the Eurozone is negatively affected by the adoption of tariffs and the repatriation of earnings of US companies as a result of tax cuts and greater geopolitical uncertainty. Spain is one of the countries least directly affected by Trump's tariffs, although some sectors can be affected by the impact on international trade.
• The volatile and erratic nature of inflation is exacerbated by new supply shocks (new tariffs, more volatile energy prices, reconfiguration of production chains, convulsive geopolitics, climate shocks, etc.) and an expansionary fiscal policy.
• The geopolitical environment becomes more complex with Trump's arrival to the White House. Trump imposes tariffs on the United States' trade partners, especially China, but these tariffs are only imposed partially, as he takes a pragmatic approach and seeks to negotiate measures that benefit the US economy. The resulting scenario is similar to what happened during Trump's first term in office. In any event, the climate of uncertainty and a trend towards greater protectionism in several regions mount. In general, the greater uncertainty over the United States' economic and foreign policy could cause episodes of volatility in the markets for some particularly sensitive variables, such as oil (tensions in the Middle East) or the Mexican peso (uncertainty over trade policy).
• The US public finances further deteriorate. Despite improvement in growth figures, the loss of tax revenue from companies adds to the existing deficit. In the Eurozone, the entry into force of the new fiscal rules entails tighter control over public finances. The focus is especially placed on France and Italy, due to high public deficits affecting these economies and which will lead to an increase in public debt in the next few years if no fiscal consolidation takes place. In the United Kingdom, the fiscal situation has also deteriorated. Concerns over the state of public finances in these economies take centre stage and could lead to isolated episodes of instability in the financial markets.
• The monetary policy gap between the United States and the Eurozone widens. The Federal Reserve is more cautious with its monetary policy, and the target interest rate remains at relatively high levels amidst more erratic fiscal policy, sustained growth and slightly higher inflation. The ECB, for its part, ends up cutting the policy rate below monetary neutrality, in response to a scenario of greater deterioration in activity. In the medium term, the policy rate is held around the estimates of monetary neutrality, due to the upside risk associated with inflation arising from public finances in a more deteriorated state than in the past, fragility in global production chains, the emergence of potential shocks and the environment of uncertainty. Meanwhile, central banks continue to make progress on their quantitative tightening policies, although they are eventually forced to stop this process to avoid causing liquidity problems in the financial markets.
• With interest rates still relatively high, the environment is prone to further episodes of financial stress, although the banking sector is resilient. Against this backdrop, there could be occasional spikes of instability related to some current financial vulnerabilities, which relate to the capital market infrastructure and the non-bank financial sector. In any event and in general, the baseline scenario considers that these events are localised and that the authorities manage to control them; therefore, they do not end up having severe and long-lasting economic repercussions.
• The Spanish economy continues to grow above its potential in the first years of the scenario's horizon and is more dynamic than the rest of the Eurozone. After a period in which the external sector has played a prominent role, domestic demand takes on a bigger role. Activity is underpinned by the increase in population (a consequence of migration), the favourable evolution of the labour market, the absence of imbalances in private agents' balance sheets and in the external sector, lower interest rates and a greater rollout of NGEU funds.
• Private sector lending in Spain gains traction and increases across all portfolios. Its momentum is similar to that of nominal GDP over the entire time horizon. Credit is supported by factors such as (i) a lower interest rate environment, (ii) higher corporate financing needs stemming from higher investment, (iii) a healthy financial position, and (iv) good labour market dynamics.
• In relation to the financial markets, yields on long-term government bonds are still maintained at relatively high levels by higher target official interest rates, a higher term premium due to volatility in growth and inflation figures, high sovereign financing needs, progress made in Quantitative Tightening (QT) and tighter monetary policy in Japan, which may alter international financial flows.
• Sovereign debt risk premiums in the European periphery remain at contained levels and in line with their respective ratings. Sovereign ratings in Spain and Italy remain unchanged.
• The US dollar, in its currency pair against the euro, shows greater resilience and reaches parity with the EU currency due to the widening of the pro-US rate differential, the improved performance of the US economy and the uncertainty caused by political and geopolitical risks.

Alternative scenario 1: productivity gains and non-existent inflation

• The scenario focuses on productivity gains stemming from an improved geopolitical environment and global supply conditions, a greater positive impact of interest rate cuts than that envisaged in the baseline scenario and a swift and far-reaching deployment of artificial intelligence, comparable to other big technological revolutions such as electricity and IT.
• The geopolitical environment improves as a result of the various ongoing wars coming to an end, which dissipates a current source of uncertainty. With that, global supply conditions improve substantially and recover features similar to those pre-Covid. Furthermore, the global supply of energy and commodities remains broad with relatively low prices.
• Artificial intelligence applications are deployed across multiple sectors of the economy and faster than envisaged in the baseline scenario. Additionally, this technology enhances the capabilities of previous innovations, such as robotisation. All of this results in productivity gains, with productivity growth at near record-high levels. Global economic growth is thus stronger and more synchronised than in the baseline scenario.
• Inflation falls faster than in the baseline scenario and remains at levels close to the monetary policy targets of the respective central banks. This is explained by a lack of disruptions in production chains and productivity gains, which makes cost absorption easier and results in more moderate second-round effects. In turn, this improves economic agents' expectations that the level of prices will remain close to central banks' targets.
• This environment allows central banks to ease their monetary policies in the near term.
• Global financing conditions remain lax, with no episodes of risk aversion.
• The macroeconomic and financial environment allows risk premiums on both peripheral debt and corporate bonds to remain contained.
• In Spain, the economy maintains significant growth momentum thanks to productivity gains, the resolution of the conflict in Ukraine, lower interest rates and the use of the NGEU funds.

Alternative scenario 2: financial instability and recession

• The scenario centres on the potential materialisation of risks to financial stability. The financial vulnerabilities in the current environment have the potential to trigger significant financial instability. The main vulnerabilities notably include (i) the systemic nature of non-bank financial institutions and their interconnections with the banking system, (ii) microstructure problems in core markets, such as treasuries, (iii) the situation in the Commercial Real Estate (CRE) sector, and (iv) vulnerabilities in China's real estate and financial sectors.

• Factors such as the reduction of central bank balance sheets (QT) or the Bank of Japan's monetary policy shift may be other events that exacerbate these vulnerabilities.
• The global economy falls into a recession, as a result of this financial instability and more restrictive financial conditions. Labour markets deteriorate with sharp rises in unemployment.
• Inflation falls due to damage to the credit channel, financial market dislocation and the economic recession, and reaches a level below the monetary policy target. The prices of oil and other commodities fall significantly and also contribute to this lower rate of inflation.
• Central banks take action to safeguard financial stability through their balance sheet policies and reinstate their liquidity programmes. Authorities also rapidly cut official interest rates to expansionary levels.
• Global financing conditions tighten, in terms of both capital markets and credit. In the financial markets, risk asset prices fall, further exacerbated by market infrastructure and illiquidity problems.
• Government bond yields decline in the face of official interest rates cuts, economic recession and falling inflation.
• Periphery risk premiums rise sharply, reducing fiscal headroom in some countries.
• The Spanish economy falls into a recession in the first half of 2025 and records negative growth until the second half of 2026. This is influenced by tightened credit supply, the economic weakness of its main trading partners and the uncertainty characterising this scenario.

As at 31 December 2024 and 2023, the main forecast variables considered for Spain and the United Kingdom are those shown below:

%
	31/12/2024
		Spain United Kingdom
		Year 1 Year 2 Year 3 Year 4 Year 5							Year 1 Year 2 Year 3 Year 4 Year 5
GDP growth
Baseline scenario	2.2	1.8	1.8	1.8	1.8	1.1	1.1	1.4	1.4	1.4
Alternative scenario 1	4.4	3.5	2.2	2.2	2.2	2.4	2.2	1.6	1.6	1.6
Alternative scenario 2	-0.3	-0.7	1.2	1.6	1.6	-0.5	-0.9	1.2	1.4	1.2
Unemployment rate
Baseline scenario	11.2	10.9	10.7	10.5	10.5	4.4	4.5	4.5	4.5	4.5
Alternative scenario 1	9.9	8.6	8.0	7.7	7.6	3.9	3.5	3.5	3.5	3.5
Alternative scenario 2	14.6	15.7	14.1	12.6	11.1	5.3	6.6	6.2	5.6	5.0
House price growth (*)
Baseline scenario	5.4	4.5	4.5	4.5	4.5	1.6	1.5	2.1	2.6	2.7
Alternative scenario 1	6.9	7.1	6.5	5.5	5.5	2.6	5.0	5.0	5.0	5.0
Alternative scenario 2	-3.7	-1.9	1.4	1.9	1.9	-4.0	-10.7	-1.7	0.0	1.6

(*) For Spain, the price variation at year-end is calculated and, for the UK, the average price variation over the year is calculated.

%	31/12/2023
	Spain					United Kingdom
		Year 1 Year 2 Year 3 Year 4 Year 5							Year 1 Year 2 Year 3 Year 4 Year 5
GDP growth
Baseline scenario	1.6	1.9	1.8	1.6	1.6	0.6	1.2	1.3	1.4	1.4
Alternative scenario 1	4.1	3.5	2.2	2.0	2.0	1.3	2.7	1.7	1.6	1.6
Alternative scenario 2	-0.2	-1.0	1.0	1.2	1.2	-0.6	-1.1	1.2	1.4	1.2
Unemployment rate
Baseline scenario	11.4	11.2	10.9	10.7	10.5	4.5	4.7	4.6	4.3	4.3
Alternative scenario 1	10.3	9.0	8.4	8.1	8.0	4.0	3.6	3.5	3.5	3.5
Alternative scenario 2	15.3	16.0	14.5	13.0	11.5	5.2	6.6	6.2	5.6	5.0
House price growth (*)
Baseline scenario	0.5	1.7	1.8	1.9	1.9	-6.5	-2.4	1.9	2.5	2.5
Alternative scenario 1	5.6	4.6	3.5	3.5	3.5	-2.5	0.5	1.0	1.6	3.4
Alternative scenario 2	-3.6	-2.1	0.0	1.9	1.9	-7.8	-9.5	-0.4	0.0	1.6

(*) For Spain, the price variation at year-end is calculated and, for the UK, the average price variation over the year is calculated.

In the Group, macroeconomic scenarios have been incorporated into the impairment calculation model.

Further adjustments to expected losses

The Group applies a series of additional adjustments to the outputs of its credit risk models, referred to as Post Model Adjustments (PMAs) or overlays, in order to address situations in which the outputs of those models are not sufficiently sensitive to uncertainty or to capture events that cannot be modelled. These adjustments are temporary and remain in place until the reasons for which they were originally applied cease to exist. In all cases, the aforesaid overlays followed the policies and procedures set by the Group, as well as their internal governance workflow, which includes a review by the second line of defence.

As at 31 December 2023, the additional adjustments applied to expected losses stemming from credit risk models amounted to around 80 million euros, of which 50 million euros corresponded to adjustments relating to sectoral factors and 30 million euros to adjustments arising from the macroeconomic environment. Both adjustments were due to an environment of high inflation and high interest rates, given the greater sensitivity of certain business and variable-rate mortgage sectors to this environment, and were included as an overlay on the Probability of Default (PD).

As at 31 December 2024, the overlays recorded in the consolidated balance sheet amount to 83 million euros. The change in the year corresponds to the specific allocation of the overlays in force as at 2023 yearend, following the annual model review process, and to the application of new overlays, in the amount of 25 million euros, estimated based on the results of the backtests carried out on PD models. Furthermore, due to the DANA emergency that took place last October, the potentially affected perimeter was identified and a reclassification was carried out, using collective overlays, reclassifying 255 million euros to stage 2 and 96 million euros to stage 3, corresponding to the most affected perimeter and on which an adjustment to the expected loss of 45 million euros was applied (see Note 4.1). Finally, the Group applied an overlay of 13 million euros to reflect environmental risks in the expected loss (see section "Environmental risk management associated with credit risk" in Note 4.4.2.1).

The Group has recorded the impact on the different stages stemming from the overlays described above through collective assessment PMAs. In that regard, overlays that entailed increasing exposures classified as stage 2 and stage 3 by 511 million euros and 135 million euros, respectively, have been applied. These overlays include the impacts of the DANA emergency mentioned above.

Sensitivity analysis of the key variables of macroeconomic scenarios

A sensitivity analysis of the expected loss of the Group and of the main geographies and its impact, by segment, on impairment allowances in the event of a change in the key variables, ceteris paribus, from the actual macroeconomic environment, with respect to the most probable baseline macroeconomic scenario envisaged in the Group's business plan, is set out below. The outcome of this analysis is described below:

Group
		Impact on expected loss
	Change in the variable (*)	Corporates	Individuals
	-100 pb	6.6%	1.2%
GDP growth deviation	+100 pb	(5.5)%	(1.1)%
	+100 pb	2.0%	2.6%
Unemployment rate deviation	-100 pb	(2.0)%	(2.1)%
	-100 pb	0.5%	0.8%
House price growth deviation	+100 pb	(0.5)%	(0.8)%

	Spain
		Impact on expected loss
	Change in the variable (*)	Corporates	Individuals
	-100 pb	6.6%	1.5%
GDP growth deviation	+100 pb	(5.5)%	(1.4)%
	+100 pb	2.0%	1.6%
Unemployment rate deviation	-100 pb	(2.0)%	(1.5)%
	-100 pb	0.5%	1.0%
House price growth deviation	+100 pb	(0.5)%	(0.9)%

United Kingdom
		Impact on expected loss
	Change in the variable (*)	Individuals
	+100 pb	6.6%
Unemployment rate deviation (**)	-100 pb	(4.5)%
	-100 pb	0.3%
House price growth deviation	+100 pb	(0.3)%

(*) Changes to macroeconomic variables are applied in absolute terms.

(**) Changes to macroeconomic variables are applied in absolute terms. In the scenario of a change to the UK unemployment rate, a deviation of +/- 100 bp represents the relative value of a deviation from the macroeconomic variable more than two times greater than in Spain.

Overall comparison between financial asset and real estate asset impairment allowances

The Group has established backtesting methodologies to compare estimated losses against actual losses.

Based on this backtesting exercise, the Group makes amendments to its internal methodologies when this regular backtesting exercise reveals significant differences between estimated losses and actual losses.

The backtests carried out show that the credit loss allowances are adequate given the portfolio's credit risk profile.

4.4.2.6. Credit quality of financial assets

As stated earlier, in general terms, the Group uses internal models to rate most borrowers (or transactions) through which credit risk is incurred. These models have been designed considering the best practices proposed by the New Basel Capital Accord (NBCA). However, not all portfolios in which credit risk is incurred have internal models, partly due to the fact that these models can only be reasonably designed if a minimum of historical non-payment case data is available. The standardised approach is followed for these portfolios, for solvency purposes.

The exposure percentage calculated by the Group using internal models, for solvency purposes, is 90%. This percentage has been calculated following the specifications of the ECB guide to internal models (Article 28a) published in June 2023.

The breakdown of total exposures rated, excluding "Other valuation adjustments (interest, fees and commissions, and other)", according to the various internal rating levels, as at 31 December 2024 and 2023, is set out here below:

Million euro	Loans assigned rating/score 2024
Breakdown of on-balance sheet exposure by rating	Note	Stage 1	Stage 2	Stage 3	Of which: purchased credit-impaired	Total
AAA/AA		21,204	241	—	2	21,446
A		17,691	37	11	—	17,739
BBB		99,768	235	—	—	100,004
BB		34,253	260	1	1	34,514
B		13,771	2,255	7	35	16,033
Other		3,031	6,838	4,576	63	14,446
No rating/score assigned		2,725	277	—	—	3,002
Total gross amount	11	192,444	10,143	4,596	101	207,183
Impairment allowances	11	(309)	(371)	(2,168)	(1)	(2,848)
Total net amount		192,135	9,772	2,428	100	204,336

Million euro

				Loans assigned rating/score
		2023
Breakdown of on-balance sheet exposure by rating	Note	Stage 1	Stage 2	Stage 3	Of which: purchased credit-impaired	Total
AAA/AA		25,486	57	—	—	25,543
A		11,644	171	13	—	11,829
BBB		83,179	252	—	1	83,431
BB		31,376	522	3	2	31,902
B		17,102	3,105	6	61	20,212
Other		3,577	7,546	5,450	45	16,574
No rating/score assigned		1,675	19	—	—	1,694
Total gross amount	11	174,039	11,672	5,473	109	191,185
Impairment allowances	11	(373)	(471)	(2,359)	(1)	(3,202)
Total net amount		173,666	11,202	3,114	108	187,982

The breakdown of total off-balance sheet exposures rated according to the various internal rating levels, as at 31 December 2024 and 2023, is set out here below:

Million euro				Loans assigned rating/score
		2024
Breakdown of off-balance sheet exposure by rating	Note	Stage 1	Stage 2	Stage 3	Of which: purchased credit-impaired	Total
AAA/AA		1,830	36	—	—	1,867
A		3,865	4	—	—	3,869
BBB		16,302	17	2	—	16,321
BB		10,882	43	4	1	10,929
B		5,485	432	8	32	5,925
Other		157	684	289	134	1,131
No rating/score assigned		80	—	—	—	80
Total gross amount	26	38,601	1,217	304	168	40,121
Provisions recognised on liabilities side of the balance sheet	26	(36)	(30)	(77)	—	(142)
Total net amount		38,565	1,187	226	168	39,979

Million euro

				Loans assigned rating/score
		2023
Breakdown of off-balance sheet exposure by rating	Note	Stage 1	Stage 2	Stage 3	Of which: purchased credit-impaired	Total
AAA/AA		1,442	44	—	—	1,485
A		3,034	—	—	—	3,035
BBB		13,533	34	2	—	13,568
BB		8,611	101	3	1	8,716
B		8,246	724	6	23	8,977
Other		159	620	355	153	1,133
No rating/score assigned		128	1	—	—	129
Total gross amount	26	35,154	1,524	365	178	37,043
Provisions recognised on liabilities side of the balance sheet	26	(48)	(30)	(86)	—	(165)
Total net amount		35,105	1,494	279	178	36,878

Further details on the credit rating and credit scoring models are included in section 4.4.2.2 of these consolidated annual financial statements.

Exposures classified as stage 3 decreased by 933 million euros in 2024. This reduction was accompanied by an increase in the risk base of 6,077 million euros, which led to a decrease in the Group's NPL ratio, as shown in the table below:

%
	2024	Proforma 2024 (*)	2023	Proforma 2023 (*)
NPL ratio	2.84	3.31	3.52	4.22
Stage 3 coverage ratio	46.34	51.38	42.33	45.55
Stage 3 coverage ratio, with total provisions	61.73	66.09	58.29	60.25

(*) Corresponds to the ratio excluding TSB.

The NPL ratio, broken down by lending segment, as at 31 December 2024 and 2023 is set out below:

%
	2024	Proforma 2024 (*)	2023	Proforma 2023 (*)
Group NPL ratio	2.84	3.31	3.52	4.22
Non-real estate construction	4.06	4.06	5.25	5.25
Corporates	2.00	2.00	2.47	2.47
SMEs and self-employed	6.70	6.74	8.52	8.58
Individuals with 1st mortgage guarantee	1.89	2.27	2.29	3.12
Real estate development and construction	5.66	5.69	6.44	6.48

(*) Corresponds to the NPL ratio excluding TSB.

A more detailed quantitative breakdown of allowances and assets classified as stage 3 can be found in Note 11, and a more detailed breakdown of refinancing and restructuring transactions is included in Schedule IV.

4.4.2.7. Concentration risk

Concentration risk refers to the level of exposure to a series of economic groups which could, given the size of that exposure, give rise to significant credit losses in the event of an adverse economic situation.

Exposures can be concentrated within a single customer or economic group, or within a given sector or geography.

Concentration risk can be caused by two risk subtypes:

• Individual concentration risk: this refers to the possibility of incurring significant credit losses as a result of maintaining large exposures to specific customers, either to a single customer or to an economic group.
• Sector concentration risk: imperfect diversification of systematic components of risk within the portfolio, which can be sector-based factors, geographical factors, etc.

Banco Sabadell has a series of specific tools and policies in place to ensure its concentration risk is managed efficiently:

• Quantitative metrics from the Risk Appetite Statement and their subsequent monitoring, including both first-tier (Board) metrics and second-tier (Executive) metrics.
• Individual limits for risks and customers considered to be significant, which are set by the Delegated Credit Committee.
• A structure of conferred powers which requires transactions with significant customers to be approved by the Risk Operations Committee, or even by the Delegated Credit Committee.

In order to control its concentration risk, Banco Sabadell Group has rolled out the following critical control parameters:

Consistency with the Global Risk Framework

The Group ensures that the level of its concentration risk exposures is consistent with its tolerance of this risk, as defined in the RAS. Overall concentration risk limits and adequate internal controls are in place to ensure that concentration risk exposures do not go beyond the risk appetite levels established by the Group.

Establishment of limits and metrics for concentration risk control

Given the nature of the Group's activity and its business model, concentration risk is primarily linked to credit risk, and various metrics are in place, along with their associated limits.

Credit risk exposure limits are set based on the Institution's past loss experience, seeking to ensure that exposures are in line with the Group's level of capitalisation as well as the expected level of profitability under different scenarios.

The metrics used to measure such levels, as well as appetite limits and tolerance thresholds for the identified risks, are described in the RAS metrics.

Risk control monitoring and regular reporting

Banco Sabadell Group ensures that concentration risk is monitored on a regular basis, in order to enable any weaknesses in the mechanisms implemented to manage this risk to be quickly identified and resolved. This information is also reported to the Board of Directors on a recurring basis in accordance with the established risk governance arrangements.

Action plans and mitigation techniques

When dealing with exceptions to internally established limits, the criteria based on which such exceptions can be approved must be included.

The Group will take any measures necessary to align the concentration risk with the levels approved in the RAS by the Board of Directors.

Exposure to customers or significant risks

As at 31 December 2024 and 2023, there were no borrowers with an approved lending transaction that individually exceeded 10% of the Group's own funds.

Country risk: geographical exposure to credit risk

Country risk is defined as the risk associated with a country's debts, taken as a whole, for reasons inherent in the sovereignty and the economic situation of that country, i.e. due to circumstances other than regular credit risk. Country risk manifests itself in the eventual inability of obligors to honour their foreign currency payment obligations undertaken with external creditors due to, among other reasons, the country not permitting access to that foreign currency, the inability to transfer it, or the non-enforceability of legal actions against borrowers for reasons of sovereignty, war, expropriation or nationalisation.

Country risk affects not only debts undertaken with a State or entities guaranteed by it, but also all private debtors that belong to that State and who, for reasons outside their control and not at their own volition, are generally unable to satisfy their debts.

An exposure limit is set for each country which is applicable across the whole of Banco Sabadell Group. These limits are approved by the Board of Directors and the corresponding decision-making bodies, as per their conferred powers, and they are continuously monitored to ensure that any deterioration in the economic, political or social prospects of a country can be detected in good time.

The main component of the procedure for the acceptance of country risk and financial institution risk is the structure of limits for different metrics. This structure is used to monitor the various risks and it is also used by Senior Management and the delegated bodies to establish the Group's risk appetite.

Different indicators and tools are used to manage country risk: credit ratings, credit default swaps, macroeconomic indicators, etc.

Schedule IV includes quantitative data relating to the breakdown of the concentration of risks by activity and on a global scale.

Exposure to sovereign risk and exposure to the construction and real estate development sector

Schedule IV includes quantitative data relating to sovereign risk exposures and exposures to the construction and real estate development sector.

4.4.2.8. Counterparty credit risk

Counterparty credit risk is a type of credit risk that refers to the risk of a counterparty defaulting before definitively settling cash flows of either a transaction with derivatives or a transaction with a repurchase commitment, with deferred settlements or collateral financing.

The amount exposed to a potential default by the counterparty does not correspond to the notional amount of the contract, instead, it is uncertain and depends on market price fluctuations until the maturity or settlement of the financial contracts.

Exposure to counterparty credit risk is mainly concentrated in customers, financial institutions and central counterparty clearing houses.

The following tables show the breakdown of exposures by credit rating and by the geographical areas in which the Group operates, as at 31 December 2024 and 2023:

%
2024
AAA	AA+	AA	AA-	A+	A	A-	BBB+	BBB	BBB-	BB+	BB	BB-	B+	Other	TOTAL
0.0%	0.0%	0.0%	30.0%	24.1%	18.0%	3.7%	4.8%	2.3%	2.4%	5.2%	5.1%	1.9%	1.0%	1.5%	100%
%
								2023
AAA	AA+	AA	AA-	A+	A	A-	BBB+	BBB	BBB-	BB+	BB	BB-	B+	Other	TOTAL
0.7%	11.5%	0.1%	32.1%	21.2%	8.1%	7.9%	3.0%	3.4%	2.0%	2.9%	2.8%	2.3%	0.5%	1.6%	100%
%
													2024		2023
Eurozone													77.7 %		77.3 %
	Rest of Europe 15.7 %							16.9 %
United States and Canada 2.7 %								3.0 %
Rest of the world 3.8 %							2.8 %

As can be seen in the table, the risk is concentrated in counterparties with a high credit quality, with 76% of the risk relating to counterparties rated A, whereas as at 31 December 2023 this concentration was 82%.

Total 100 % 100 %

In 2016, under the European Market Infrastructure Regulation (EMIR) (Regulation 648/2012), the obligation to settle and clear certain Over-The-Counter (OTC) derivatives through central counterparty clearing houses (CCPs) began to apply to the Group. For this reason, the derivatives arranged by the Group and subject to the foregoing are channelled via these agents. At the same time, the Group has improved the standardisation of OTC derivatives with a view to fostering the use of clearing houses. The exposure to risk with CCPs largely depends on the value of the deposited guarantees.

With regard to derivative transactions in Organised Markets (OMs), based on management criteria, it is considered that there is no exposure, given that there is no risk as the OMs act as counterparties in the transactions and a daily settlement and guarantee mechanism is in place to ensure the transparency and continuity of the activity. In OMs the exposure is equivalent to the deposited guarantees.

The breakdown of transactions involving derivatives in financial markets, according to whether the counterparty is another financial institution, a clearing house or an organised market, is shown below:

Thousand euro
	2024	2023
Transactions with organised markets	506,105	1,505,736
OTC transactions	202,054,253	188,207,641
Settled through clearing houses	126,969,629	113,467,997
Total	202,560,358	189,713,377

There are currently no transactions that meet the accounting criteria for offsetting transactions involving financial assets and financial liabilities on the balance sheet. The netting of derivative and repo transactions is only material when calculating the amount pending collateralisation, and is not material in terms of their presentation on the balance sheet.

The following tables show the aggregate amount reflected on the balance sheet for the financial instruments subject to a master netting and collateral agreement for 2024 and 2023:

Thousand euro
			2024
			Financial assets subject to collateral agreements
	Amount recognised on balance sheet	Amount offset (for collateral calculations	Guarantee received Cash Securities		Net amount
Financial assets	(a)	only) (b)	(c)	(d)	(a)-(b)-(c)-(d)
Derivatives	4,268,483	2,262,755	688,855	1,353,869	(36,996)
Reverse repos	10,725,012	—	31,590	10,720,991	(27,569)
Total	14,993,495	2,262,755	720,445	12,074,860	(64,565)
Thousand euro
			2024 Financial liabilities subject to collateral agreements
	Amount recognised	Amount offset (for	Guarantee given
	on balance sheet	collateral calculations only)	Cash	Securities	Net amount
Financial liabilities	(a)	(b)	(c)	(d)	(a)-(b)-(c)-(d)
Derivatives	2,664,520	2,262,755	517,133	374,681	(490,049)
Repos	12,034,968	—	65,831	12,262,513	(293,376)
Total	14,699,488	2,262,755	582,964	12,637,194	(783,425)
Thousand euro
			2023
			Financial assets subject to collateral agreements
	Amount recognised	Amount offset (for collateral calculations	Guarantee received		Net amount
	on balance sheet	only)	Cash	Securities
Financial assets	(a)	(b)	(c)	(d)	(a)-(b)-(c)-(d)
Derivatives	4,827,407	2,903,168	1,822,777	124,929	(23,467)
Reverse repos	5,146,361	—	45,522	5,207,911	(107,072)
Total	9,973,768	2,903,168	1,868,299	5,332,840	(130,539)
Thousand euro
			2023
	Financial liabilities subject to collateral agreements
	Amount recognised on balance sheet	Amount offset (for collateral calculations	Guarantee given Cash	Securities	Net amount
		only)
Financial liabilities	(a)	(b)	(c)	(d)	(a)-(b)-(c)-(d)
Derivatives	3,206,489	2,903,168	457,090	358,000	(511,769)
Repos	11,065,324	—	144,461	11,608,411	(687,548)
Total	14,271,813	2,903,168	601,551	11,966,411	(1,199,317)

The values of derivative financial instruments which are settled through a clearing house as at 31 December 2024 and 2023 are indicated here below:

Thousand euro
	2024	2023
Derivative financial assets settled through a clearing house Derivative financial liabilities settled through a clearing house	3,644,950 1,877,174	4,012,659 2,498,128

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The philosophy behind counterparty credit risk management is consistent with the business strategy, at all times seeking to ensure the creation of value whilst maintaining a balance between risk and return. To this end, criteria have been established for controlling and monitoring counterparty credit risk arising from activity in financial markets, which ensure that the Bank can carry out its business activity whilst adhering to the risk thresholds approved by the Board of Directors.

The approach for quantifying counterparty credit risk exposure takes into account current and future exposure. Current exposure represents the cost of replacing a transaction at the present time and at market value in the event that a counterparty defaults. To calculate it, the current or Mark to Market (MtM) value of the transaction is required. The future exposure represents the risk that a transaction could potentially represent over a certain period of time, given the characteristics of the transaction and the market variables on which it depends. In the case of transactions carried out under a collateral agreement, the future exposure represents the possible fluctuation of the MtM between the time of default and the replacement of such transactions in the market. If the transaction is not carried out under a collateral agreement, it represents the possible changes in MtM throughout the life of the transaction.

Each day at close of business, all of the exposures are recalculated in accordance with the transaction inflows and outflows, changes in market variables and risk mitigation mechanisms established by the Group. Exposures are thus subject to daily monitoring and they are controlled in accordance with the limits approved by the Board of Directors. This information is included in risk reports for disclosure to the departments and areas responsible for their management and monitoring.

With regard to counterparty credit risk, the Group has different mitigation techniques. The main techniques are:

• Netting agreements for derivatives (ISDA and Spain's Framework Agreement for Financial Transactions (Contrato Marco de Operaciones Financieras, or CMOF)).
• Variation margin collateral agreements for derivatives (CSA and Annex 3 CMOF), repos (GMRA, EMA) and securities lending (GMSLA).
• Initial margin collateral agreements for derivatives (CTA and SA).

Netting agreements allow positive and negative MtM to be aggregated for transactions with a single counterparty, in such a way that in the event of default, a single payment or collection obligation is established in relation to all of the transactions closed with that counterparty.

By default, the Group has netting agreements with all counterparties wishing to trade in derivatives.

Variation margin collateral agreements, as well as including the netting effect, also include the regular exchange of guarantees which mitigate the current exposure with a counterparty in respect of the transactions subject to such agreements.

In order to trade in derivatives or repos with financial institutions, the Group requires variation margin collateral agreements to be in place. Furthermore, for derivative transactions with these institutions, the Group is required to exchange variation margin collateral with financial counterparties pursuant to Delegated Regulation (EU) 2016/2251. The Group's standard variation margin collateral agreement, which complies with the aforesaid regulation, is bilateral (i.e. both parties are obliged to deposit collateral) and includes the daily exchange of guarantees in the form of cash and in euros.

Initial margin collateral agreements include the provision of guarantees to mitigate the potential future exposure with a counterparty in respect of the transactions subject to such agreements.

The Group has initial margin collateral agreements in place for derivative transactions with financial institutions pursuant to Delegated Regulation (EU) 2016/2251.

4.4.2.9 Assets pledged in financing activities

As at 31 December 2024 and 2023, there were certain financial assets pledged in funding operations, i.e. delivered as collateral or guarantees with respect to certain liabilities. These assets correspond mainly to loans linked to the issuance of mortgage covered bonds, public sector covered bonds, TSB covered bonds and long-term asset-backed securities (see Note 20 and Schedule II). The remaining pledged assets are debt securities which are submitted in transactions involving assets sold under repurchase agreements, pledged collateral (loans or debt instruments) to access certain funding operations with central banks and all types of collateral provided to secure derivative transactions.

The issuing entity Banco Sabadell did not issue any public sector covered bonds in either 2024 or 2023.

The Group has used part of its portfolio of loans and similar credit in fixed-income securities by transferring assets to various securitisation funds created for this purpose. Under current regulations, securitisations in which there is no significant risk transfer cannot be derecognised from the balance sheet.

The balance of the financial assets securitised under these programmes by the Group, as well as other financial assets transferred, depending on whether they have been derecognised or retained in full on the consolidated balance sheet, as at 31 December 2024 and 2023, is as follows:

Thousand euro
	2024	2023
Fully derecognised from the balance sheet:	833,458	568,975
Securitised mortgage assets	112,162	111,624
Other securitised assets	175,490	228,671
Other financial assets transferred	545,806	228,680
Fully retained on the balance sheet:	7,808,968	7,446,823
Securitised mortgage assets	6,434,096	6,394,928
Other securitised assets	1,374,872	1,051,894
Total	8,642,426	8,015,798

The assets and liabilities associated with securitisation funds of assets originated after 1 January 2004, and for which inherent risks and rewards of ownership have not been transferred to third parties, have been retained on the consolidated balance sheet. As at 31 December 2024 and 2023, there was no significant financial support from the Group for unconsolidated securitisations.

Schedule II to these consolidated annual financial statements includes certain information regarding the securitisation funds originated by the Group.

4.4.3. Financial risks

Financial risk is defined as the possibility of obtaining inadequate returns or having insufficient levels of liquidity that prevent an institution from meeting future requirements and expectations.

4.4.3.1 Liquidity and funding risk

Liquidity risk refers to the possibility of losses being incurred as a result of the Institution being unable, albeit temporarily, to honour payment commitments due to a lack of liquid assets or due to its inability to access the markets to refinance debts at a reasonable cost. This risk may be associated with factors of a systemic nature or specific to the Institution itself.

In this regard, the Group aims to maintain a stock of liquid assets and a funding structure that, in line with its strategic objectives and based on its Risk Appetite Statement, allow it to honour its payment commitments as usual and at a reasonable cost, both under business-as-usual conditions and in a stress situation caused by systemic and/or idiosyncratic factors.

The fundamental pillars of Banco Sabadell's governance structure for liquidity management and control are the direct involvement of the governing body, Board committees and management bodies, following the model of three lines of defence, and a clear segregation of duties, as well as a clear-cut structure of responsibilities.

Liquidity management

Banco Sabadell's liquidity management seeks to ensure funding for its business activity at an appropriate cost and term while minimising liquidity risk. The Institution's funding policy focuses on maintaining a balanced funding structure, based mainly on customer deposits and supplemented with access to wholesale markets that allows the Group to maintain a comfortable liquidity position at all times.

The Group follows a structure based on Liquidity Management Units (LMUs) to manage its liquidity. Each LMU is responsible for managing its own liquidity and for setting its own metrics to control liquidity risk, working together with the Group's corporate functions. As at the end of December 2024, the LMUs are Banco Sabadell (includes Banco de Sabadell, S.A., which in turn includes activity in foreign branches, as well as the business in Mexico of Banco Sabadell S.A., I.B.M. (IBM) and SabCapital S.A. de C.V., SOFOM, E.R. (SOFOM)) and TSB.

In order to achieve these objectives, the Group's current liquidity risk management strategy is based on the following principles and pillars, in line with the LMUs' retail business model and the defined strategic objectives:

• Risk governance and involvement of the Board of Directors and Senior Management in managing and controlling liquidity risk. The Board of Directors has the highest level of responsibility for the oversight of liquidity risk, while the management bodies of the LMUs are in charge of transposing these strategies to their local areas of activity.
• Integration of the risk culture, based on prudent liquidity risk management and clear and consistent definitions of their terminology, and on its alignment with the Group's business strategy through the established risk appetite.
• Clear segregation of responsibilities and duties between the different areas and bodies within the organisation, with a clear-cut distinction between each of the three lines of defence, providing independence in the evaluation of positions and in risk assessment and control.
• Implementation of best practices in liquidity risk management and control, ensuring not only compliance with regulatory requirements but also, under a criterion of prudence, the availability of sufficient liquid assets to overcome possible stress events.
• Decentralised liquidity management system for the more significant units but with a centralised risk oversight and management system.
• Sound processes for the identification, measurement, management, control and disclosure of the different liquidity subrisks to which the Group is exposed.
• Holistic overview of risk, through first- and second-tier risk taxonomies, and complying with regulatory requirements, recommendations and guidelines.
• Existence of a transfer pricing system to transfer the cost of funding.
• Balanced funding structure with a predominance of customer deposits.
• Ample base of unencumbered liquid assets that can be used immediately to generate liquidity and which comprise the Group's first line of liquidity.
• Diversification of funding sources, with controlled use of short-term wholesale funding without having to depend on individual fund suppliers.
• Self-funding by the main banking subsidiaries outside Spain.
• Oversight of the balance sheet volume being used as collateral in funding operations.
• Maintenance of a second line of liquidity that includes the capacity to issue covered bonds.
• Alignment with the interests of stakeholders through regular public disclosure of liquidity risk information.
• Availability of a Liquidity Contingency Plan.

Tools/metrics for monitoring and controlling liquidity risk management

Banco Sabadell Group has a system of metrics and thresholds which are provided in the RAS and which define the appetite for liquidity risk, previously approved by the Board of Directors. This system enables liquidity risk to be assessed and monitored, ensuring the achievement of strategic objectives, adherence to the risk profile, as well as compliance with regulations and supervisory guidelines. Within the Group-level monitoring of liquidity metrics, there are metrics established at the Group level and calculated on a consolidated basis, metrics established at the Group level and rolled out to each Group LMU, as well as metrics established at the LMU level to reflect specific local characteristics.

Both the metrics defined in the Banco Sabadell Group RAS and those defined in the local RAS of subsidiaries are subject to governance arrangements relating to the approval, monitoring and reporting of threshold breaches, as well as remediation plans established in the RAF on the basis of the hierarchical level of each metric (these are classified into three tiers).

It should be mentioned that the Group has designed and implemented a system of Early Warning Indicators (EWIs) at the LMU level, which includes market and liquidity indicators adapted to the funding structure and business model of each LMU. The rollout of these indicators at the LMU level complements the RAS metrics and allows tensions in the local liquidity position and funding structure to be detected early, thereby facilitating the implementation of corrective measures and actions and reducing the risk of contagion between the different management units.

The risk of each LMU is also monitored on a daily basis through a report that measures daily changes in the funding needs of the balance sheet, daily changes in the outstanding balance of transactions in capital markets, as well as daily changes in the liquidity buffer maintained by each LMU.

The metrics reporting and control framework involves, among other things:

• Monitoring the RAS metrics and their thresholds on a consolidated basis, as well as those established for each LMU, in line with the established monitoring frequency.
• Reporting on the relevant set of metrics to the governing body, Board committees and management bodies, depending on the tiers into which those metrics have been classified.
• In the event a threshold breach is detected, activating the communication protocols and necessary plans for its resolution.

Within the Group's overall budgeting process, Banco Sabadell plans its liquidity and funding requirements over different time horizons, which it aligns with the Group's strategic objectives and risk appetite. Each LMU has a one-year and five-year funding plan in which they set out their potential funding needs and the strategy for their management, and they regularly analyse compliance with that plan, any deviations from the projected budget and the extent to which the plan is appropriate to the market environment.

In addition, Banco Sabadell regularly reviews the identification of liquidity risks and assesses their materiality. At least for all risks deemed material, there are specific management strategies and metrics in place that capture these risk components. It also conducts regular liquidity stress tests, which envisage a series of stress scenarios in the short and longer term, and it analyses their impact on the liquidity position and the main metrics in order to ensure that the existing exposures are consistent at all times with the established liquidity risk tolerance level.

The Institution also has an internal transfer pricing system to transfer the funding costs to business units.

Lastly, Banco Sabadell has a Liquidity Contingency Plan (LCP) in place, which sets forth the strategy for ensuring that the Institution has sufficient management capabilities and measures in place to minimise the negative impacts of a crisis situation on its liquidity position and to allow it to return to a business-as-usual situation. The LCP can be invoked in response to different crisis situations affecting either the markets or the Institution itself. The key components of the LCP include, among others: the definition of the strategy for its implementation, the inventory of measures available to generate liquidity in business-as-usual situations or in a crisis situation linked to the invocation of the LCP and a communication plan (both internal and external) for the LCP.

Residual maturity periods

The tables below show the breakdown, by contractual maturity, of certain pools of items on the consolidated balance sheet as at 31 December 2024 and 2023, under business-as-usual market conditions:

Thousand euro

				2024
Time to maturity	On demand	Up to 1 month	1 to 3 months	3 to 12 months	1 to 2 years	2 to 3 years	3 to 4 years	4 to 5 years	More than 5 years	Total
ASSETS
Cash, balances at central banks and other demand deposits	2,903,589	14,565,334	904,529	291	1,542	67	—	40	6,721	18,382,112
Financial assets at fair value through other comprehensive income	—	593,078	77,044	275,548	486,307	566,862	1,161,580	51,072	2,964,841	6,176,333
Debt securities	—	593,078	77,044	275,548	486,307	566,862	1,161,580	51,072	2,964,841	6,176,333
Loans and advances	—	—	—	—	—	—	—	—	—	—
Customers	—	—	—	—	—	—	—	—	—	—
Financial assets at amortised cost	4,528,831	9,644,170	5,725,389	12,375,307	12,095,615	11,549,771	9,722,394	13,799,010	117,079,786	196,520,273
Debt securities	—	220,258	493,837	576,152	655,379	1,734,512	1,120,974	3,153,128	16,921,887	24,876,126
Loans and advances	4,528,831	9,423,912	5,231,552	11,799,155	11,440,236	9,815,259	8,601,420	10,645,883	100,157,899	171,644,147
Central banks	—	—	—	—	—	—	—	—	—	—
Credit institutions	1,635,317	4,323,451	1,774,734	2,691,877	2,019,243	200,241	7,368	4,606	114,849	12,771,685
Customers	2,893,513	5,100,460	3,456,818	9,107,279	9,420,993	9,615,018	8,594,053	10,641,277	100,043,050	158,872,462
Total assets	7,432,420	24,802,582	6,706,962	12,651,146	12,583,464	12,116,700	10,883,974	13,850,122	120,051,348	221,078,718
LIABILITIES
Financial liabilities at amortised cost	146,175,007	6,813,797	7,856,577	24,703,466	9,897,518	5,391,327	5,238,029	6,614,424	7,538,104	220,228,249
Deposits	139,976,026	6,721,627	6,978,766	22,804,921	5,592,393	1,806,048	747,935	1,087,158	626,306	186,341,181
Central banks	26,409	—	—	961,191	—	709,134	—	—	—	1,696,734
Credit institutions	922,074	3,490,314	2,147,448	3,852,724	2,398,334	599,744	525,847	428,471	456,844	14,821,800
Customers	139,027,543	3,231,313	4,831,318	17,991,006	3,194,059	497,170	222,088	658,687	169,462	169,822,647
Debt securities issued	18,312	69,439	866,144	1,882,263	4,297,875	3,579,062	4,480,573	5,514,192	6,729,078	27,436,938
Other financial liabilities	6,180,670	22,730	11,667	16,282	7,250	6,217	9,521	13,074	182,720	6,450,130
Total liabilities	146,175,007	6,813,797	7,856,577	24,703,466	9,897,518	5,391,327	5,238,029	6,614,424	7,538,104	220,228,249
Trading and Hedging derivatives
Receivable	—	44,995,897	7,837,360	26,135,974	17,079,237	9,514,491	10,227,723	9,803,529	37,218,249	162,812,462
Payable	—	42,509,276	8,560,630	27,816,215	24,155,085	13,635,105	10,190,986	9,283,604	40,814,400	176,965,301
Contingent risks
Financial guarantees	640	53,084	115,909	481,218	185,154	87,913	43,746	39,348	972,610	1,979,622

(*) For details of maturities of issues aimed at institutional investors, see the section entitled "Funding strategy and evolution of liquidity in 2024" in this note.

Thousand euro

2023
Time to maturity	On demand	Up to 1 month	1 to 3 months	3 to 12 months	1 to 2 years	2 to 3 years	3 to 4 years	4 to 5 years	More than 5 years	Total
ASSETS
Cash, balances at central banks and other demand deposits	2,879,139	26,518,399	575,341	1,972	64	1,630	206	—	9,102	29,985,853
Financial assets at fair value through other comprehensive income	—	28,056	69,236	791,454	560,553	518,426	302,223	1,132,974	2,682,437	6,085,359
Debt securities	—	28,056	69,236	791,454	560,553	518,426	302,223	1,132,974	2,682,437	6,085,359
Loans and advances	—	—	—	—	—	—	—	—	—	—
Customers	—	—	—	—	—	—	—	—	—	—
Financial assets at amortised cost	4,062,743	5,493,867	3,858,019	12,168,889	11,057,059	10,776,821	10,537,660	10,184,113	112,774,622	180,913,793
Debt securities	—	4,833	315,660	1,204,916	1,123,028	479,039	1,743,646	1,187,212	15,442,593	21,500,927
Loans and advances	4,062,743	5,489,034	3,542,359	10,963,974	9,934,031	10,297,782	8,794,014	8,996,901	97,332,028	159,412,866
Central banks	—	156,516	—	—	—	—	—	—	—	156,516
Credit institutions	1,411,422	445,014	732,541	2,114,438	1,666,642	573,056	56	9,210	43,572	6,995,951
Customers	2,651,321	4,887,504	2,809,818	8,988,540	8,267,389	9,724,726	8,793,958	8,987,691	97,149,452	152,260,399
Total assets	6,941,882	32,040,322	4,502,596	12,962,315	11,617,676	11,296,877	10,840,089	11,317,087	115,466,161	216,985,005
LIABILITIES
Financial liabilities at amortised cost	107,548,804	43,256,136	11,499,120	15,574,656	15,126,695	6,730,104	4,632,257	5,160,504	6,543,490	216,071,766
Deposits	101,442,894	42,529,331	9,538,402	13,218,907	12,300,947	2,453,941	1,103,014	750,550	609,211	183,947,196
Central banks	60,915	—	5,106,963	5,753	3,926,127	—	676,601	—	—	9,776,360
Credit institutions	1,039,225	4,678,234	816,081	2,817,579	2,263,510	1,306,692	254,561	171,991	492,311	13,840,183
Customers	100,342,754	37,851,097	3,615,358	10,395,575	6,111,309	1,147,249	171,852	578,559	116,900	160,330,653
Debt securities issued	16,214	693,854	1,951,456	2,340,622	2,816,403	4,270,058	3,525,049	4,406,209	5,771,418	25,791,284
Other financial liabilities	6,089,696	32,951	9,262	15,127	9,345	6,105	4,194	3,745	162,861	6,333,286
Total liabilities	107,548,804	43,256,136	11,499,120	15,574,656	15,126,695	6,730,104	4,632,257	5,160,504	6,543,490	216,071,766
Trading and Hedging derivatives
Receivable	—	50,823,146	11,328,791	28,452,907	14,570,051	10,892,738	7,921,211	9,074,442	33,210,726	166,274,013
Payable	—	30,233,517	10,838,943	29,856,672	20,222,682	11,930,292	8,979,495	7,146,036	40,908,171	160,115,808
Contingent risks
Financial guarantees	17,922	66,449	66,038	414,294	259,415	92,562	68,818	34,938	1,043,960	2,064,396

In this analysis, very short-term maturities traditionally represent funding requirements, as they include continuous maturities of short-term liabilities, which in typical banking activities see higher turnover rates than assets, but as they are continuously rolled over they actually end up satisfying these requirements and at times even result in the growth of outstanding balances.

Furthermore, the Group's funding programmes in capital markets are systematically checked to ensure they can meet its short-, medium- and long-term needs.

With regard to the information included in these tables, it is worth highlighting that they show the residual term to maturity of the asset and liability positions on the balance sheet, broken down into different time brackets.

The information provided is static and does not reflect foreseeable funding needs.

It should also be noted that cash flow breakdowns in the parent company have not been deducted.

In order to present the contractual maturities of financial liabilities with certain particular characteristics, the parent company has taken the following approach:

• Transactions are placed in different time brackets according to their contractual maturity date.
• Demand liabilities are included in the "on demand" tranche, without taking into account their type (stable vs unstable).
• There are also contingent commitments which could lead to changes in liquidity needs. These are fundamentally credit facilities with amounts undrawn by the borrowers as at the balance sheet date. The Board of Directors also establishes limits in this regard for control purposes.
• Balances related to financial guarantee contracts have been included for the parent company, allocating the maximum amount of the guarantee to the earliest period in which the guarantee can be called.
• Funding in capital markets obtained through instruments that include clauses which could lead to accelerated repayment (instruments with clauses linked to a credit rating downgrade or puttables) is reduced in line with the Group's financial liabilities. It is for this reason that the estimated impact on the parent company would not be significant.
• As at 31 December 2024 and 2023, the Group had no instruments in addition to those regulated by master agreements associated with the arrangement of derivatives and repos/reverse repos.
• The Group does not have any instruments that allow the Institution to choose whether it settles its financial liabilities by delivering cash (or another financial asset) or by delivering its own shares as at 31 December 2024 and 2023.

Funding strategy and evolution of liquidity in 2024

The Group's primary source of funding is customer deposits (mainly demand deposits and term deposits acquired through the branch network), supplemented with funding raised through interbank and capital markets in which the Institution has and regularly renews various short-term and long-term funding programmes in order to achieve an adequate level of diversification by type of product, term and investor. The Institution maintains a diversified portfolio of liquid assets that are largely eligible as collateral in exchange for access to funding operations with the European Central Bank (ECB).

On-balance sheet customer funds

On-balance sheet customer funds as at 31 December 2024 and 2023 are shown below by maturity:

Million euro / %
	Note	2024	3 months	6 months	12 months	>12 months	No maturity
Total on-balance sheet customer funds (*)		169,557	5.7 %	4.3 %	5.8 %	2.6 %	81.6 %
Term deposits and others		30,690	30.9 %	22.9 %	32.1 %	14.1 %	— %
Demand deposits	19	138,347	— %	— %	— %	— %	100.0 %
Retail issues		520	41.9 %	57.5 %	0.6 %	— %	— %

(*) Includes customer deposits (excl. repos) and other liabilities placed via the branch network: straight bonds issued by Banco Sabadell, commercial paper and others.

	Note	2023	3 months	6 months	12 months	>12 months	No maturity
Total on-balance sheet customer funds (*)		160,888	5.6 %	2.4 %	4.3 %	4.3 %	83.4 %
Term deposits and others		25,237	32.1 %	13.6 %	26.8 %	27.5 %	— %
Demand deposits	19	134,243	— %	— %	— %	— %	100.0 %
Retail issues		1,408	53.8 %	30.9 %	14.7 %	0.6 %	— %

(*) Includes customer deposits (excl. repos) and other liabilities placed via the branch network: straight bonds issued by Banco Sabadell, commercial paper and others.

Despite falling interest rates in the financial markets, the weight of term deposits and other deposits in the composition of on-balance sheet customer funds has increased.

Details of off-balance sheet customer funds managed by the Group and those sold but not under management are provided in Note 27 to these consolidated annual financial statements.

The Group's deposits are sold through the business units of the Group (Banking Business Spain, TSB and Mexico). Details of the volumes of these business units are included in section "4. Business" of the consolidated Directors' Report.

In 2024, the funding gap turned positive, with a sharper increase in on-balance sheet customer funds than in gross performing loans to customers (excluding reverse repos), thus placing the Group's Loan-to-Deposit (LtD) ratio at 93.2% as at 2024 year-end (94.0% as at 2023 year-end).

Capital markets

In 2024, the level of funding in capital markets, through debt issuance and securitisations, increased. In order to keep an adequate level of own funds and eligible liabilities above the applicable regulatory requirement (Minimum Requirement for own funds and Eligible Liabilities, or MREL), the balance of senior non-preferred debt and subordinated debt also increased. The outstanding nominal balance of funding in capital markets, by type of product, as at 31 December 2024 and 2023, is shown below:

Million euro
	2024	2023
Outstanding nominal balance	27,076	24,596
Covered bonds	11,523	10,975
Of which: TSB Bank	3,817	3,164
Commercial paper and ECP	—	6
Senior debt	4,273	4,215
Senior non-preferred debt	5,030	4,425
Subordinated debt and preferred securities	4,065	3,565
Asset-backed securities	2,185	1,410
Of which: TSB Bank	597	—
Of which: Sabadell Consumer Finance	294	494

Maturities of issues in capital markets, by type of product (excluding asset-backed securities and commercial paper), and considering their legal maturity, as at 31 December 2024 and 2023, are analysed below:

Million euro
	2025	2026	2027	2028	2029	2030	>2030	Balance outstanding
Mortgage bonds and covered bonds (*)	831	1,390	2,306	2,493	2,053	1250	1200	11,523
Senior debt (**)	980	—	500	750	1,293	750	—	4,273
Senior non-preferred debt (**)	500	1,317	18	500	1,500	500	695	5,030
Subordinated debt and preferred securities (**)	300	500	—	—	—	—	3,265	4,065
Total	2,611	3,207	2,824	3,743	4,846	2,500	5,160	24,891
(*) Secured issues.
(**) Unsecured issues.
Million euro
	2024	2025	2026	2027	2028	2029	>2029	Balance outstanding
Mortgage bonds and covered bonds (*)	2,425	836	1,390	2,251	2,423	950	700	10,975
Senior debt (**)	735	1,480	—	500	750	750	—	4,215
Senior non-preferred debt (**)	395	500	1,317	18	500	1,500	195	4,425
Subordinated debt and preferred securities (**)	—	—	500	—	—	—	3,065	3,565
Total	3,555	2,816	3,207	2,769	3,673	3,200	3,960	23,180

(*) Secured issues. (**) Unsecured issues.

The Group has a number of funding programmes in operation in capital markets with a view to diversifying its different funding sources.

In terms of short-term funding, as at year-end there was one commercial paper programme in operation, which governs the issuance of such securities and is aimed at institutional and retail investors. The Banco Sabadell Commercial Paper Programme for 2024, registered with Sociedad de Gestión de los Sistemas de Registro, Compensación y Liquidación de Valores, S.A.U. (IBERCLEAR), has an issuance limit of 7 billion euros, which can be extended to 9 billion euros. As at 31 December 2024, the outstanding balance of the programme was 511 million euros (net of commercial paper subscribed by Group companies), compared with 1,383 million euros as at 31 December 2023.

Regarding medium- and long-term funding, the Institution has the following programmes in operation:

– Base Prospectus of Non-Equity Securities ("Fixed Income Programme") registered with the CNMV on 18 July 2024, with an issuance limit of 10 billion euros, which permits the issuance of instruments under Spanish law through the CNMV aimed at institutional and retail investors, both domestic and foreign. More specifically, the programme regulates the issuance of straight, non-preferred or structured bonds and debentures, in addition to mortgage covered bonds and public sector covered bonds (European guaranteed bonds, also known as premium covered bonds). As at 31 December 2024, the limit available for new issues under the Banco Sabadell Programme for the issuance of non-equity securities for 2024 is 7.75 billion euros (as at 31 December 2023, the available limit under the Fixed Income Programme for 2023 was 9.8 billion euros).

In 2024, Banco Sabadell carried out two public issues of mortgage covered bonds under the Fixed Income Programme in effect at the time amounting to a total of 1.75 billion euros.

Million euro	ISIN code	Type of investor	Issue date	Amount	Term (years)
Mortgage Covered Bonds 2/2024	ES0413860851	Institutional	05/06/2024	1,000	10
Mortgage Covered Bonds 3/2024	ES0413860877	Institutional	15/10/2024	750	5.5

– Euro Medium Term Notes (EMTN) Programme, registered with the Irish Stock Exchange on 14 May 2024 and renewed on 24 July and 8 November 2024. This programme allows senior debt (preferred and non-preferred) and subordinated debt to be issued in various currencies, with a maximum limit of 20 billion euros.

In 2024, Banco Sabadell carried out five issues under the EMTN Programme, amounting to a total of 2,793 million euros: two issues of senior preferred debt, one of them issued for the first time in GBP amounting to 450 million pounds, two issues of senior non-preferred debt and one subordinated debt issue. The issues executed by Banco Sabadell over the year are indicated here below (showing the legal maturity period in the case of issues with an early redemption option):

Million euro
	ISIN code	Type of investor	Issue date	Amount	Term (years)
Senior Debt 1/2024	XS2745719000	Institutional	15/01/2024	750	6
Green Senior Non-Preferred Debt 1/2024	XS2782109016	Institutional	13/03/2024	500	6.5
Subordinated Debt 1/2024	XS2791973642	Institutional	27/03/2024	500	10.25
Senior Debt 2/2024 (GBP)	XS2898158485	Institutional	13/09/2024	543	5
Green Senior Non-Preferred Debt 2/2024	XS2947089012	Institutional	27/11/2024	500	6.5

In 2024, having obtained the corresponding authorisation, Banco Sabadell exercised the early redemption option on the Senior Debt 2/2019 series amounting to 500 million euros on 7 November 2024. Furthermore, having obtained the corresponding authorisation, Banco Sabadell released an announcement to the market in November regarding the early redemption of the Subordinated Debt 1/2020 series in the amount of 300 million euros, which took place on 17 January 2025.

For its part, TSB Bank was active in the covered bonds market in 2024. On 5 March 2024, it carried out its inaugural issuance in EUR amounting to 500 million euros at a fixed rate of 3.32%, and on 11 September 2024, it carried out another issue amounting to 500 million pounds sterling with a floating coupon rate of SONIA + 53 bps, both maturing in five years.

In relation to traditional format asset securitisation:

– The Group is an active participant in this market and it takes part in various securitisation programmes, sometimes acting together with other institutions, granting mortgage loans, loans to small and medium-sized enterprises, consumer loans and loans for the purchase of vehicles.

• There are currently 19 outstanding traditional asset securitisation transactions fully recognised on the Group's balance sheet. A portion of the securities issued by securitisation funds have been placed in the capital markets and the remainder have been kept in the Group's portfolio. Of the latter, the eligible securities can be used as collateral for the central bank's funding operations. As at 31 December 2024, the nominal balance of asset-backed securities placed on the market was 2,185 million euros.
• On 23 May 2024, TSB Bank set up the securitisation fund of residential mortgage loans, Duncan Funding 2024-1 PLC, through which it securitised one portfolio of mortgage loans in the amount of 557.7 million pounds sterling. The entire senior tranche of 500 million pounds was placed on the market.
• On 26 September 2024, the traditional securitisation Sabadell Consumo 3, F.T. carried out by Banco Sabadell under its consumer loan securitisation programme was paid out. This is the third operation of the programme enabling the credit risk of a 750 million euro consumer loan portfolio to be financed and transferred. The issue consists of seven classes of bonds that were placed on the market, with the exception of the first loss tranche of 9.2 million euros to fund the reserve fund and initial expenses, and 76.3 million euros from the senior series which was subscribed by Banco de Sabadell, S.A.

Following the maturity in March 2024 of 5 billion euros corresponding to the TLTRO III facility, as at 2024 year-end the balance drawn from funding operations with the European Central Bank was nil.

For its part, TSB had outstanding borrowings from the Bank of England in the amount of 1,385 million pounds as at the end of 2024, corresponding to the Term Funding Scheme with additional incentives for SMEs (TFSME). This funding accrues interest daily at the Bank of England's base rate.

Liquid assets

In addition to these sources of funding, the Group maintains a liquidity buffer in the form of liquid assets to meet potential liquidity needs:

Million euro
	2024	2023
Cash(*) + Net interbank position	12,668	25,036
Available in Bank of Spain facility	20,466	15,363
ECB eligible assets not pledged in facility	20,812	11,419
Other non-ECB eligible marketable assets (**)	6,643	6,740
Memorandum item:
Balance drawn from Bank of Spain facility (***)	—	5,000
Balance drawn from Bank of England Term Funding Scheme (****)	1,670	4,608
Total Liquid Assets Available	60,589	58,558

(*) Surplus of reserves and Marginal Deposit Facility in central banks.

(**) At market value and after applying the Liquidity Coverage Ratio (LCR) haircut. Includes fixed income considered as a high-quality liquid asset in accordance with LCR (HQLA) and other marketable assets from various Group companies.

(***) Correspond to TLTRO-III facility.

(****) As at year-end 2024, includes 1,385 million pounds to support Small and Medium-sized Enterprises (TFSME). As at year-end 2023, included 4,000 million pounds from the TFSME and 5 million pounds from the ILTR.

In 2024, the balance of reserves and of the marginal deposit facility in central banks and the net interbank position showed a decline of 12,368 million euros, while the volume of ECB-eligible liquid assets increased by 14,496 million euros and the available non-ECB eligible assets decreased by 97 million euros, thus raising the first line of liquidity by 2,031 million euros in the year, with the positive funding gap and increased wholesale issues placed with institutional customers, as well as the repayment of central bank funding operations, standing out as positive factors.

It should be noted that the Group follows a decentralised liquidity management model. This model tends to limit the transfer of liquidity between the different subsidiaries involved in liquidity management, thereby limiting intra-group exposures, beyond any restrictions imposed by the local regulators of each subsidiary. Thus, the subsidiaries involved in liquidity management determine their liquidity position by considering only those assets in their possession that meet the eligibility, availability and liquidity criteria set forth both internally and in regulations in order to comply with regulatory minima.

In addition to the first line of liquidity, each LMU monitors its liquidity buffer using an internal conservative criterion called the counterbalancing capacity. In the case of the Banco Sabadell LMU (includes Banco de Sabadell, S.A., which in turn includes activity in foreign branches, as well as the business in Mexico of Banco de Sabadell, S.A.), this liquidity buffer comprises the first and second lines of liquidity. As at 31 December 2024, the second line of liquidity added a volume of 12,418 million euros to the liquidity buffer, including the covered bond issuing capacity, considering the average valuation applied by the central bank to own-use covered bonds to obtain funding, as well as the deposits held in other financial institutions and immediately available for the business in Mexico not included in the first line of liquidity.

In the TSB LMU, this metric is the sum of the first line of liquidity plus loans prepositioned with the Bank of England in order to obtain funding. As at 31 December 2024, the second line of liquidity, considering the amount of loans prepositioned with the Bank of England, amounts to 6,703 million euros (4,936 million euros as at 31 December 2023).

There are no significant amounts of cash or cash equivalents that are unavailable for use by the Group.

Compliance with regulatory ratios

As part of its liquidity management, Banco Sabadell Group monitors the short-term Liquidity Coverage Ratio (LCR) and the Net Stable Funding Ratio (NSFR), reporting the necessary information to the regulator on a monthly and quarterly basis, respectively. The measurement of liquidity based on these metrics forms part of the liquidity risk oversight process in the set of LMUs.

In terms of the LCR, since 1 January 2018, the regulatory required minimum LCR has been 100%, a level amply surpassed by all of the Group's LMUs. At the Group level, throughout the year, the LCR has consistently been well above 100%. As at 31 December 2024, the LCR stood at 200% for the TSB LMU, 248% for Banco Sabadell Spain and 210% at the Group level.

In terms of the NSFR, the regulatory minimum requirement, effective from June 2021, is 100%, a level amply surpassed by all LMUs of the Institution given their funding structure, in which customer deposits are predominant and where the majority of market funding is in the medium/long term. As at 31 December 2024, the NSFR stood at 153% for the TSB LMU, 137% for Banco Sabadell Spain and 142% at the Group level.

As at 31 December 2024, Banco Sabadell had outstanding issues of mortgage covered bonds amounting to 15,776 million euros (15,876 million euros as at 31 December 2023), which are secured by eligible mortgage loans and credit in the amount of 24,567 million euros (24,677 million euros at 31 December 2023). As at 31 December 2024, the mortgage covered bonds therefore had an overcollateralisation ratio of 156% (161% as at 31 December 2023), with all their collateral denominated in euros. More information can be found on the Group's corporate website (www.grupbancsabadell.com), in section "Shareholders and Investors - Fixed income investors".

4.4.3.2. Market risk

Market risk is defined as the risk of financial instrument positions losing some or all of their market value due to changes in risk factors affecting their market price or quotations, their volatility, or the correlations between them.

Positions that generate market risk are usually held in connection with trading activity, which consists of the hedging transactions arranged by the Bank to provide services to its customers as well as discretionary proprietary positions.

Market risk can also arise from the mere maintenance of overall (also known as structural) balance sheet positions that in net terms are left open. This risk is addressed in the sections on structural risks.

The items of the consolidated balance sheet as at 31 December 2024 and 2023 are shown below, making a distinction between positions included in trading activity and other positions. In the case of items not included in trading activity, their main risk factor is indicated:

Thousand euro
31/12/2024
	On-balance sheet balance	Trading activity	Other	Main market risk factor in "Other"
Assets subject to market risk	239,597,927	2,615,848	236,982,079
Cash, cash balances at central banks and other demand deposits	18,382,112	—	18,382,112	Interest rate
Financial assets held for trading	3,438,955	2,615,848	823,107	Interest rate; credit spread
Non-trading financial assets mandatorily at fair value through profit or loss	168,267	—	168,267	Interest rate; credit spread
Financial assets at fair value through other comprehensive income	6,369,913	—	6,369,913	Interest rate; credit spread
Financial assets at amortised cost	196,520,273	—	196,520,273	Interest rate
Derivatives – Hedge accounting	2,394,902	—	2,394,902	Interest rate
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(412,346)	—	(412,346)	Interest rate
Investments in joint ventures and associates	524,562	—	524,562	Equity
Other assets	12,211,289	—	12,211,289	—
Liabilities subject to market risk	224,565,372	1,292,292	223,273,080
Financial liabilities held for trading	2,381,434	1,292,292	1,089,142	Interest rate
Derivatives – Hedge accounting	803,999	—	803,999	Interest rate
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(227,209)	—	(227,209)	Interest rate
Financial liabilities at amortised cost	220,228,249	—	220,228,249	Interest rate
Other liabilities	1,378,899	—	1,378,899	—
Equity	15,032,555	—	15,032,555

Thousand euro

31/12/2023
	On-balance sheet balance	Trading activity	Other	Main market risk factor in "Other"
Assets subject to market risk	235,172,955	1,731,724	233,441,231
Cash, cash balances at central banks and other demand deposits	29,985,853	—	29,985,853	Interest rate
Financial assets held for trading	2,706,489	1,731,724	974,765	Interest rate; credit spread
Non-trading financial assets mandatorily at fair value through profit or loss	153,178	—	153,178	Interest rate; credit spread
Financial assets at fair value through other comprehensive income	6,269,297	—	6,269,297	Interest rate; credit spread
Financial assets at amortised cost	180,913,793	—	180,913,793	Interest rate
Derivatives – Hedge accounting	2,424,598	—	2,424,598	Interest rate
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(567,608)	—	(567,608)	Interest rate
Investments in joint ventures and associates	462,756	—	462,756	Equity
Other assets	12,824,599	—	12,824,599	—
Liabilities subject to market risk	221,293,749	1,689,953	219,603,796
Financial liabilities held for trading	2,867,459	1,689,953	1,177,506	Interest rate
Derivatives – Hedge accounting	1,171,957	—	1,171,957	Interest rate
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(422,347)	—	(422,347)	Interest rate
Financial liabilities at amortised cost	216,071,766	—	216,071,766	Interest rate
Other liabilities	1,604,914	—	1,604,914	—
Equity	13,879,206	—	13,879,206

The market risk acceptance, management and oversight system is based on managing positions expressly assigned to different trading desks and establishing limits for each one, in such a way that the different trading desks have the obligation to always manage their positions within the limits established by the Board of Directors and the Investments and Liquidity Committee. Market risk limits are aligned with the Group's targets and Risk Appetite Framework.

Trading activity

The main market risk factors considered by the Group in its trading activity are the following:

• Interest rate risk: risk associated with the possibility of interest rate fluctuations adversely affecting the value of a financial instrument. This is reflected, for example, in transactions involving interbank deposits, fixed income and interest rate derivatives.
• Credit spread risk: this risk arises from fluctuations in the credit spreads at which instruments are quoted with respect to other benchmark instruments, such as interbank interest rates. This risk occurs mainly in fixed-income instruments.
• Foreign exchange risk: risk associated with the fluctuation of exchange rates with respect to the functional currency. In the case of Banco Sabadell, the functional currency is the euro. This risk occurs mainly in currency exchange transactions and currency derivatives.
• Equity price risk: risk arising from fluctuations in the value of capital instruments (shares and quoted indices). This risk is reflected in the market prices of the securities and their derivatives.

Changes in commodities prices have not had an impact in the year, as the Group has residual (both direct and underlying) exposures.

Market risk incurred in trading activity is measured using the VaR and stressed VaR methodologies, which allows risks to be standardised across different types of financial market transactions.

VaR provides an estimate of the maximum potential loss associated with a position due to adverse, but normal, movements of one or more of the identified parameters generating market risk. This estimate is expressed in monetary terms and refers to a specific date, a particular level of confidence and a specified time horizon. A 99% confidence interval is used. Due to the low complexity of the instruments and the high level of liquidity of the positions, a time horizon of 1 day is used.

The methodology used to calculate VaR is historical simulation. The advantages of this methodology are that it is based on a full revaluation of transactions under recent historical scenarios, and that no assumptions need to be made as regards the distribution of market prices. The main limitation to this methodology is its reliance on historical data, given that, if a possible event has not materialised within the range of historical data used, it will not be reflected in the VaR data.

The reliability of the VaR methodology used can be verified using backtesting techniques, which serve to verify that the VaR estimates fall within the confidence level considered. Backtesting consists of comparing daily VaR against daily results. If losses exceed the VaR level, an exception occurs. No backtesting exceptions occurred in 2024 or 2023.

Stressed VaR is calculated in the same way as VaR but with a historical insight into variations of the risk factors in stressed market conditions. These stressed conditions are determined on the basis of currently outstanding transactions, and may vary if the portfolios' risk profile changes. The methodology used for this risk measurement is historical simulation.

Market risk monitoring is supplemented with additional measurements such as risk sensitivities, which refer to a change in the value of a position or portfolio in response to a change in a particular risk factor, and also with the calculation of management results, which are used to monitor stop-loss limits.

Furthermore, specific simulation exercises are carried out considering extreme market scenarios (stress testing). These exercises consist of revaluing the portfolios in scenarios to which different assumptions are applied. Broadly speaking there are two types of scenarios: on one hand, historical scenarios, developed based on historical events that have occurred in the markets in the past and which are relevant to the current position of the portfolios (e.g. the global financial crisis or the Covid-19 crisis) and, on the other hand, hypothetical scenarios, which consider theoretical shifts in risk factors, such as shifts in yield curves, credit spreads or exchange rates, as well as movements in these factors resulting from the application of different macroeconomic forecasts determined based on the current situation. As at the end of December 2024, the impact of the most adverse scenario considered was a loss of 16.4 million euros.

Market risk is monitored on a daily basis and reports are made to supervisory bodies on the existing risk levels and on the compliance with the limits set forth by the Investments and Liquidity Committee for each trading desk (limits based on nominal value, VaR and sensitivity, as applicable). This makes it possible to keep track of changes in exposure levels and measure the contribution of market risk factors.

The market risk incurred on trading activity in terms of 1-day VaR with a 99% confidence interval for 2024 and 2023 was as follows:

Million euro
	2024			2023
	Average	Maximum	Minimum	Average	Maximum	Minimum
Interest rate risk	1.75	5.29	0.87	1.98	3.96	1.00
Exchange rate (trading position)	0.82	2.04	0.00	2.26	2.52	1.81
Equity	—	—	—	—	—	—
Credit spread	0.30	0.79	0.10	0.27	0.72	0.09
Aggregate VaR	2.87	7.51	1.10	4.51	5.94	3.25

In 2024, the overall VaR figures for trading activity decreased, mainly in exchange rates due to a lower exposure to this risk factor.

4.4.3.3. Structural interest rate risk and credit spread risk

Structural interest rate risk is defined as the current or future risk to both the income statement (revenues and expenses) and the economic value (present value of assets, liabilities and off-balance sheet positions) arising from adverse movements in interest rates that affect interest rate-sensitive instruments in nontrading activities (also known as Interest Rate Risk in the Banking Book, or IRRBB).

Credit Spread Risk in the Banking Book (CSRBB) refers to potential losses in the economic value of an institution's equity and earnings driven changes in the market price for credit risk, for liquidity and for potentially other characteristics of credit-risky instruments, which are not captured by another existing prudential framework such as IRRBB or by expected credit/(jump-to-) default risk. In other words, it captures how the credit spread fluctuates within a certain credit rating/PD range.

The Group's management of these risks pursues two fundamental objectives:

• Stabilise and defend net interest income, preventing interest rate fluctuations and movements in credit spreads from causing excessive changes to the budgeted NII.
• Minimise the volatility of the economic value of equity, this perspective being complementary to that of NII.

Interest rate risk and credit spread risk are managed through a Group-wide approach on the basis of the RAS, approved by the Board of Directors. A decentralised model is followed based on Balance Sheet Management Units (BSMUs). In coordination with the Group's corporate functions, each BSMU has the autonomy and capability to carry out risk management and control duties.

The Group's current interest rate risk and credit spread risk management strategy is based on the following principles in particular, in line with the business model and the defined strategic objectives:

• Each BSMU has appropriate tools and robust processes and systems in place to adequately identify, measure, manage, control and report on IRRBB and CSRBB, following the main criteria defined by the Group's internal methodologies. This makes it possible to obtain information about all of the identified sources of IRRBB and CSRBB, assess their effect on the net interest income and the economic value of equity and measure the vulnerability of the Group/BSMU in the event of potential losses arising from IRRBB and CSRBB under different scenarios affecting the interest rate and credit spread curves.
• At the corporate level, a series of limits are established for overseeing and monitoring IRRBB and CSRBB exposure levels, which are aligned with internal risk tolerance policies. However, each BSMU has the autonomy and structure required to properly manage and control IRRBB and CSRBB. Specifically, each BSMU has sufficient autonomy to choose the management target that it will pursue, although all BSMUs should follow the principles and critical parameters set by the Group, adapting them to the specific characteristics of the region in which they operate.
• The existence of a transfer pricing system.

– The set of systems, processes, metrics, limits, reporting arrangements and governance arrangements included within the IRRBB and CSRBB strategy must comply with regulatory precepts at all times.

As defined in the IRRBB and CSRBB Management and Control Policy, the first line of defence is undertaken by the various BSMUs, which report to their respective local Asset and Liability Committees. Their main role is to manage interest rate risk and credit spread risk, ensuring they are assessed on a recurrent basis through management and regulatory metrics, taking into account the modelling of the various balance sheet totals and the level of risk taken.

The metrics developed to control and monitor the Group's structural interest rate risk and credit spread risk are aligned with best market practice, consistently implemented in all BSMUs, based on the results obtained from the exercise carried out to identify subrisks and assess their materiality, and monitored on an ongoing basis by each of the local Asset and Liability Committees. The diversification effect between currencies and BSMUs is taken into account when disclosing overall figures.

A) Interest rate risk

The Group identifies five subrisks when managing interest rate risk:

• Repricing risk arises from differences in the timing of rate changes of interest rate-sensitive instruments, covering changes to the term structure of interest rates occurring consistently across the yield curve (parallel shifts).
• Curve risk arises from differences in the timing of rate changes of interest rate-sensitive instruments, covering changes to the term structure of interest rates occurring differentially by period (non-parallel shifts).
• Basis risk includes the risk arising from the impact of relative changes in interest rates on instruments that have similar tenors but are re-priced using different interest rate indices.
• Automatic option risk comprises the risk arising from automatic options (e.g. lending floors and caps), both embedded and explicit, in which the Balance Sheet Management Unit (BSMU) or its customer can alter the level and timing of their cash flows and in which the holder will almost certainly exercise the option when it is in their financial interest to do so.
• Behavioural option risk arises from flexibility embedded implicitly within the terms of certain financial contracts, which allow changes in interest rates to effect a change in the behaviour of the customer.

The main calculations performed by the Group on a monthly basis are the following:

• Interest rate gap: static metric showing the breakdown of maturities and repricing of sensitive balance sheet items. This metric compares the values of assets that are due to be repriced or that mature in a given period and the liabilities that mature or are to be repriced in that same period.
• Duration analysis: a static metric based on the allocation of all flows of principal and interest of pools of interest rate-sensitive instruments into time buckets. The duration of each pool is calculated from the change of its net present value due to a 1 basis point parallel shift of the yield curve. This gives the duration of both assets and liabilities.
• Net Interest Income (NII) sensitivity: dynamic metric that measures the impact of changes in interest rates over different time horizons. It is obtained by comparing net interest income over a given time horizon in the baseline scenario, which is the one obtained from market-implied interest rates, against the one obtained in an instantaneous shock scenario, always considering the result obtained in the least favourable scenario. This metric supplements the economic value of equity sensitivity.
• Economic Value of Equity (EVE) sensitivity: static metric that measures the impact of changes in interest rates. It is obtained by comparing the economic value of the balance sheet in the baseline scenario against the one obtained in an instantaneous shock scenario, always considering the result obtained in the least favourable scenario. This is done by calculating the present value of interest rate-sensitive items as an updated risk-free interest rate curve, on the reference date, of future payments of principal and interest without taking into account commercial margins, in line with the Group's IRRBB management strategy. This metric supplements the NII sensitivity.

– A sensitivity metric that combines the two previous metrics: the effect of changes in value of instruments recognised directly through profit or loss or through equity is added to NII sensitivity.

In the quantitative interest rate estimations made by each BSMU, a series of interest rate scenarios are designed which allow the different sources of risk mentioned above to be identified. These scenarios include, for each significant currency, parallel shifts and non-parallel shifts of the interest rate curve. Based on these, sensitivity is calculated as the difference resulting from:

• Baseline scenario: movements in market interest rates based on implicit interest rates.
• Stressed scenario: a shift in interest rates in relation to the baseline scenario, with the extent of this shift varying depending on the scenario to be calculated. A post-shock interest rate floor is applied, starting at -150 basis points for immediate maturities and increasing by 3 basis point intervals, eventually reaching 0% after 50 years or more.

In addition, in the annual planning exercises, measurements are made that include assumptions regarding the balance sheet's evolution based on the scenarios used for the forecasts of the Group's Financial Plan, which consider different interest rates, volumes and margins.

Furthermore, in accordance with the Group's corporate principles, all BSMUs regularly carry out stress tests, which allow them to forecast high-impact situations with a low probability of occurrence that could place BSMUs in a position of extreme exposure to interest rate risk, and they also consider mitigating actions for such situations. The stress test is complemented with reverse stress tests which aim to identify the scenarios capable of producing a particular impact within a pre-established range of values.

The following table gives details of the Group's interest rate gap based on maturities and interest rate revisions, excluding valuation adjustments, as at 31 December 2024 and 2023:

Thousand euro
2024
Time to maturity or repricing	Up to 1 month	1 to 3 months	3 to 12 months	1 to 2 years	2 to 3 years	3 to 4 years	4 to 5 years	More than 5 years	Total
Money Market	21,691,850	1,901,411	2,391,070	1,794,318	501,503	—	—	—	28,280,152
Loans and advances	23,296,410	19,367,084	37,662,507	22,787,454	16,736,970	7,703,007	6,878,001		23,866,583 158,298,016
Debt securities	2,198,962	1,208,027	890,700	1,815,732	2,909,413	2,532,602	3,743,718	16,849,120	32,148,274
Other assets									—
Total assets	47,187,222	22,476,522	40,944,277	26,397,504	20,147,886	10,235,609	10,621,719		40,715,703 218,726,442
Money Market	9,409,623	2,119,855	3,338,265	1,217,663	302,450	—	679	9,706	16,398,241
Customer deposits	51,630,795	7,580,106	25,659,920	15,426,823	12,800,712	12,563,300	12,001,116		30,378,861 168,041,633
Issues of marketable securities	6,307,008	2,456,805	2,412,664	3,457,000	3,118,100	4,235,000	3,242,705	2,460,025	27,689,307
Of which: Subordinated liabilities	300,000	—	—	1,500,000	750,000	1,000,000	500,000	15,025	4,065,025
Other liabilities	463,790	591,493	519,626	(230,649)	(27,136)	(12,381)	(437,615)	534,823	1,401,951
Total liabilities	67,811,216	12,748,259	31,930,475	19,870,837	16,194,126	16,785,919	14,806,885		33,383,415 213,531,132
Hedging derivatives		13,272,841 (3,720,531)		4,957,997 (5,307,194) (2,241,525)		3,190,397	2,619,712	(12,570,434)	201,263
Interest rate gap	(7,351,153)	6,007,732	13,971,799	1,219,473		1,712,235 (3,359,913) (1,565,454)		(5,238,146)	5,396,573

107

Thousand euro

				2023
Time to maturity or repricing	Up to 1 month	1 to 3 months	3 to 12 months	1 to 2 years	2 to 3 years	3 to 4 years	4 to 5 years	More than 5 years	Total
Money Market	29,298,908	664,785	1,818,033	1,648,692	571,125	287,671	—	—	34,289,214
Loans and advances	23,289,667	18,267,252	36,992,760	19,860,090	14,717,416	11,920,708	5,947,632		20,062,136 151,057,661
Debt securities	1,565,120	1,299,818	1,505,582	1,647,183	1,044,180	2,025,963	3,155,852	16,790,643	29,034,341
Other assets	—	—	—	—	—	—	—	—	—
Total assets	54,153,695	20,231,855	40,316,375	23,155,965	16,332,721	14,234,342	9,103,484		36,852,779 214,381,216
Money Market	17,450,615	1,108,877	2,058,721	1,726,558	445,470	287,671	679	9,706	23,088,297
Customer deposits	46,218,567	6,417,593	19,517,264	17,132,088	13,348,923	12,421,891	12,849,214		30,969,933 158,875,473
Issues of marketable securities	4,555,412	3,950,878	1,801,870	3,908,110	3,457,000	3,118,100	3,735,000	1,660,025	26,186,395
Of which: Subordinated liabilities	—	—	—	300,000	1,500,000	750,000	500,000	515,025	3,565,025
Other liabilities	48,661	133,257	232,342	152,773	138,920	121,899	110,203	615,072	1,553,127
Total liabilities	68,273,255	11,610,605	23,610,197	22,919,529	17,390,313	15,949,561	16,695,096		33,254,736 209,703,292
Hedging derivatives	9,660,254	(2,755,498)	1,713,842	308,201	105,235	539,236	2,366,742	(11,938,012)	—
Interest rate gap	(4,459,305)	5,865,752	18,420,020	544,637	(952,357)	(1,175,983)	(5,224,870)	(8,339,969)	4,677,925

The following tables show the interest rate risk levels in terms of the sensitivity of the Group's main currencies, as at 2024 year-end, to the most frequently used interest rate scenarios in the sector:

	Instant and parallel interest rate increase
	100 bp	200 bp
Interest rate sensitivity	Impact on net interest margin (*)	Impact on economic value of equity (**)
EUR	0.0%	(4.0)%
GBP	1.4%	(1.1)%
USD	0.4%	(0.2)%
MXN	0.1%	(0.1)%

(*) Percentage calculated on the basis of net interest income at 12 months.

(**) Percentage calculated on the basis of shareholders' equity.

	Instant and parallel interest rate decrease
	100 bp	200 bp
Interest rate sensitivity	Impact on net interest margin (*)	Impact on economic value of equity (**)
EUR	(0.8)%	2.2%
GBP	(1.0)%	0.6%
USD	(0.5)%	0.2%
MXN	(0.1)%	0.1%

(*) Percentage calculated on the basis of net interest income at 12 months.

(**) Percentage calculated on the basis of shareholders' equity.

In addition to the impact on the net interest income within the time horizon of one year shown in the previous table, the Group calculates the impact on NII over a time horizon of two and three years, the result of which is considerably more positive for all currencies in a scenario of interest rate hikes.

The metrics are calculated taking into account the behavioural assumptions concerning items with no contractual maturity and those whose expected maturity is different from the maturity established in the contracts, in order to obtain a view that is more realistic and, therefore, more effective for management purposes. The most significant of these include:

– Prepayment of the loan portfolio and early termination of term deposits (embedded optionality): in order to reflect customers' reactions to interest rate fluctuations, prepayment/early termination assumptions are defined, broken down by type of product. To that end, the Institution uses historical data to ensure alignment with best market practice. The evolution of market interest rates can prompt customers to pay off their loans or withdraw term deposits early, altering the future evolution of balances with respect to that envisaged according to the contractual schedule. Prepayment mainly affects fixed-rate mortgages when their contractual interest rates are high compared to market interest rates.

• Modelling of demand deposits and other liabilities with no contractual maturity: a model has been defined using historical monthly data to reproduce customer behaviour, establishing parameters concerning the deposits' stability, the percentage of interest rate movements that is passed through to the interest paid on the deposits and the delay with which this occurs, depending on the type of product (type of account/transactionality/interest paid) and the type of customer (retail/wholesale). The model captures the effect of low interest rates on the stability of deposits, as well as the potential migration to other deposits that earn more interest in different interest rate scenarios.
• Modelling of non-performing lending items: a model has been defined that enables the expected cash flows associated with non-performing positions (net of provisions, i.e. those expected to be recovered) to be included within pools of interest rate-sensitive items. To that end, both existing balances and estimated recovery periods have been included.

The process for approving and updating IRRBB models is part of the corporate governance arrangements for models, whereby these models are reviewed and validated by a division that is always separate from the division that created them. This process is described in the corresponding Model Risk Policy and establishes both the responsibilities of the different areas involved in the models and the internal validation framework to be followed, the monitoring requirements established on the basis of their materiality and the backtesting processes.

Regarding the measurement systems and tools used, all sensitive transactions are identified and recorded taking into account their interest rate characteristics, the sources of information being the official ones of the Institution. These transactions are aggregated according to predefined criteria, so that calculations can be made faster without undermining the quality or reliability of the data. The entire data process is subject to the requirements of information governance and data quality, to ensure compliance with the best practices in relation to information governance and data quality. Additionally, a regular process is carried out to reconcile the information uploaded onto the measurement tool against accounting information. The calculation tool includes sensitive transactions and its parameters are also configured to reflect the result of the behavioural models described above, the volumes and prices of the new business, defined according to the Financial Plan, and the interest rate curves on which the aforesaid scenarios are built.

Based on the balance sheet position and the market situation and outlooks, mitigation strategies are proposed and agreed upon to adapt this position to the one desired by the Group and to ensure it remains within the established risk appetite. Interest rate instruments additional to the natural hedges of balance sheet items are used as mitigation techniques, such as fixed-income bond portfolios or hedging derivatives that enable metrics to be placed at levels in keeping with the Institution's risk appetite. In addition, proposals can be put forward to redefine the interest rate characteristics of commercial products or the launch of new products.

Derivatives, mainly Interest Rate Swaps (IRS), which qualify as hedges for accounting purposes, are arranged in financial markets to be used as risk hedging instruments. Two separate types of macro-hedges are used:

• Cash flow macro-hedges of interest rate risk, the purpose of which is to reduce net interest income volatility due to changes in interest rates over a one-year time horizon.
• Fair value macro-hedges of interest rate risk, the purpose of which is to maintain the economic value of the hedged items, consisting of fixed-rate assets and liabilities.

For each type of macro-hedge, there is a framework document that includes the hedging strategy, defining it in terms of management and accounting and establishing its governance arrangements.

In Banco Sabadell, as part of the continuous improvement process, structural interest rate risk management and monitoring activities are implemented and regularly updated, aligning the Institution with best market practice and current regulations. In particular, throughout 2024 work has continued on the review and continuous improvement of the systems and behavioural models in accordance with the guidelines established by the EBA. Among other things, some of the improvements worth noting are the update of the key behavioural modelling assumptions for demand deposits, taking sufficiently large time series data to capture periods of both rising and falling interest rate stress, obtaining different results based on the different interest rate scenarios modelled, and their recurrent monitoring to ensure the appropriateness of those assumptions.

In 2024, the Bank's loan book has continued to trend towards a higher proportion of fixed-rate transactions (mainly mortgages and business loans), while on the liabilities side, balances of interest-bearing demand deposits and term deposits have increased whilst the balance of non-interest-bearing demand deposits has decreased, all while keeping costs at low levels relative to the trend of interest rates over the year. In addition, other balance sheet variations in 2024 included the increase of the fixed-income portfolio on the asset side, which acts as a balance sheet management and coverage lever, and the implementation of management actions to defend net interest income against a backdrop of interest rate cuts.

With regard to interest rates, in 2024 benchmark interest rates decreased in all currencies, affecting the euro in particular, with the 12-month Euribor standing at 2.46% as at 2024 year-end, 1.05% lower than as at 2023 year-end. The deposit facility rate of the European Central Bank (ECB) ended the year at 3% (decrease of 100 basis points over the year), while the base rate of the Bank of England (BoE) ended at 4.75% (decrease of 50 basis points over the year). The scenario envisaged in the short/medium term will likely involve a reduction in central bank rates as inflation continues to fall back gradually, and it is therefore expected that Euribor levels will remain slightly below those at 2024 year-end. In this respect, it is expected that the cost of customer funds will remain contained even though balances of interest-bearing products continue to grow.

Taking into account the balance sheet variations detailed above, as well as episodes of volatility and variations in the benchmark interest rates of all the Group's material currencies, the IRRBB metrics have been affected during the year, although the measures taken have allowed the Group's IRRBB metrics to be kept within the risk appetite and below the levels considered significant under current legislation.

Furthermore, the Group continues to monitor customer behaviour in reaction to interest rate cuts or variations of other economic variables (unemployment rates, gross domestic product, etc.), in order to anticipate possible changes and impacts on the behavioural assumptions used to measure and manage IRRBB. In particular, it analyses and monitors customer behaviour related to non-maturing items (changes in the stability of demand deposits and possible migration to other products that earn higher interest) and related to items with an expected maturity that may be different to the contractually established maturity (due to early repayment of loans, early termination of term deposits or recovery time and balance of nonperforming exposures).

B) Credit spread risk

To identify credit spread risk, the Group has taken into account both the market credit spread component, which represents the credit risk premium required by market participants for a specific credit quality, and the market liquidity spread component, which represents the premium of the market's appetite for investments and the presence of buyers and sellers willing to trade. Furthermore, in general the generic idiosyncratic component has been isolated, using segmentation criteria by sector, geography and currency.

The Institution used current regulations when determining CSRBB-sensitive instruments. The instruments included by the Group in the CSRBB perimeter are those directly or indirectly indexed to market prices of liquid instruments.

In the quantitative credit spread risk estimations, a series of credit spread scenarios are designed which allow the different sources of risk to be identified. These scenarios include, for each significant currency, narrowing and widening shifts in credit spreads (stress scenarios). Based on these, the sensitivity is calculated as the difference resulting from the stressed scenario and the baseline scenario.

The main calculations performed by the Group on a monthly basis are the following:

• Net Interest Income (NII) sensitivity: dynamic metric that measures the impact of changes in credit spreads over a one-year time horizon. It is obtained by comparing net interest income in the baseline scenario, which is the one obtained from credit spreads on the analysis date and from market-implied interest rates, against the one obtained in a stress scenario, always considering the result obtained in the least favourable scenario. This metric supplements the economic value of equity sensitivity.
• Economic Value of Equity (EVE) sensitivity: static metric that measures the impact of changes in credit spreads. It is obtained by comparing the economic value of the balance sheet in the baseline scenario against the one obtained in a stress scenario, always considering the result obtained in the least favourable scenario. This is done by calculating the present value of items included in the perimeter as an updated risk-free interest rate curve on the reference date, to which credit spreads of future payments of principal and interest have been added. This metric supplements the NII sensitivity.

As for the measurement systems and tools used, the Institution employs the data uploaded and the tool already in place to measure IRRBB, to which credit spread curves are added, the impact of which is measured at the position level.

During 2024, the Institution has been negatively exposed to widening credit spreads, although this exposure is very limited due to fixed-income portfolio growth.

4.4.3.4. Structural foreign exchange risk

Structural foreign exchange risk occurs when changes in market exchange rates between different currencies generate losses on permanent investments in foreign branches and subsidiaries with functional currencies other than the euro.

The purpose of managing structural foreign exchange risk is to minimise the impact on the value of the Institution's portfolio/equity in the event of any adverse movements in currency markets. The foregoing takes into account the potential impacts on the capital (CET1) ratio and on the net interest margin, subject to the risk appetite defined in the RAS. Furthermore, the levels set for the established risk metrics must be complied with at all times.

Foreign exchange risk is monitored regularly and reports are sent to supervisory bodies on existing risk levels and on compliance with the limits set forth by the Board of Directors. The main monitoring metric is currency exposure, which measures the maximum potential loss that the open structural position could produce over a one-month time horizon, with a 99% confidence level and in stressed market conditions.

Compliance with, and the effectiveness of, the established limits and targets are monitored and reported on a monthly basis to the Board Risk Committee.

The Bank's Financial division, through the ALCO, designs and executes strategies to hedge structural FX positions in order to achieve its objectives in relation to the management of structural foreign exchange risk.

The most prominent permanent investments in non-local currencies are held in US dollars, pounds sterling and Mexican pesos.

The Group has been following a hedging policy for its equity that seeks to minimise the sensitivity of capital ratios to adverse movements in these currencies against the euro. To that end, the evolution of foreign business is monitored, as are the political and macroeconomic variables that could have a significant impact on exchange rates.

As regards permanent investments in US dollars, the overall position in this currency has gone from 1,413 million as at 31 December 2023 to 1,414 million as at 31 December 2024. In relation to this position, as at 31 December 2024, the buffer stood at 42% of total investment.

In terms of permanent investments in Mexican pesos, the capital buffer has gone from 8,553 million Mexican pesos as at 31 December 2023 (of a total exposure of 16,340 million Mexican pesos) to 8,853 million Mexican pesos as at 31 December 2024 (of a total exposure of 17,532 million Mexican pesos), representing 50% of the total investment made.

As regards permanent investments in pounds sterling, the capital buffer has increased from 393 million pounds sterling as at 31 December 2023 to 545 million pounds sterling as at 31 December 2024 (total exposure has gone from 2,105 million pounds sterling as at 31 December 2023 to 2,461 million pounds sterling as at 31 December 2024), representing 22% of the total investment made (excluding intangibles).

Currency hedges are continuously reviewed in light of market movements.

The exchange value in euros of assets and liabilities in foreign currencies maintained by the Group as at 31 December 2024 and 2023, classified in accordance with their nature, is as follows:

Thousand euro

	2024
	USD	GBP	Other currencies	Total
Assets denominated in foreign currency:	13,114,897	56,256,038	4,487,972	73,858,907
Cash, cash balances at central banks and other demand deposits	556,262	5,847,477	513,763	6,917,502
Debt securities	1,743,289	2,788,170	928,135	5,459,594
Loans and advances	10,531,529	45,367,799	2,819,964	58,719,292
Central banks and Credit institutions	21,946	430,708	574,118	1,026,772
Customers	10,509,583	44,937,091	2,245,846	57,692,520
Other assets	283,817	2,252,592	226,110	2,762,519
Liabilities denominated in foreign currency:	6,613,257	51,622,906	3,286,238	61,522,401
Deposits	6,340,154	44,308,399	3,185,361	53,833,914
Central banks and Credit institutions	868,994	1,748,153	412,160	3,029,307
Customers	5,471,160	42,560,246	2,773,201	50,804,607
Other liabilities	273,103	7,314,507	100,877	7,688,487

Thousand euro

	2023
	USD	GBP	Other currencies	Total
Assets denominated in foreign currency:	11,265,090	56,117,680	4,600,172	71,982,942
Cash, cash balances at central banks and	481,860	6,819,973	553,349	7,855,182
other demand deposits
Debt securities	1,559,704	2,855,459	680,098	5,095,261
Loans and advances	8,966,780	43,462,345	3,109,836	55,538,961
Central banks and Credit institutions	43,478	516,046	508,155	1,067,679
Customers	8,923,302	42,946,299	2,601,681	54,471,282
Other assets	256,746	2,979,903	256,889	3,493,538
Liabilities denominated in foreign currency:	6,130,275	51,558,530	3,482,251	61,171,056
Deposits	5,891,369	45,112,710	3,374,404	54,378,483
Central banks and Credit institutions	717,213	4,720,896	562,911	6,001,020
Customers	5,174,156	40,391,814	2,811,493	48,377,463
Other liabilities	238,906	6,445,820	107,847	6,792,573

The net position of foreign currency assets and liabilities includes the structural position of the Institution, valued as at 31 December 2024, which amounts to 3,549 million euros, of which 2,310 million euros correspond to permanent equity holdings in pounds sterling, 784 million euros correspond to permanent equity holdings in US dollars and 403 million euros to permanent equity holdings in Mexican pesos. Net assets and liabilities valued at historical exchange rates are hedged with currency forwards and currency options in line with the Group's policy.

As at 31 December 2024, the sensitivity of the equity exposure to a 2.5% exchange rate depreciation against the euro of the main currencies to which exposure exists, calculated based on quarterly exchange rate volatility over the past three years, amounts to 89 million euros, of which 65% corresponds to the pound sterling, 22% corresponds to the US dollar and 11% to the Mexican peso.

4.4.4. Operational risk

Operational risk is defined as the risk of incurring losses due to inadequate or failed internal processes, people and systems or due to external events. This definition includes but is not limited to compliance risk, model risk and Information and Communications Technology (ICT) risk and excludes strategic risk and reputational risk.

The Group has an operational risk management framework in place, which encompasses different types of subrisks defined within operational risk, establishing a common and unified framework for management and control, which can be expanded to include material risks with particular features or which require greater management and control. The management of operational risk is decentralised and devolved to process managers throughout the organisation. These processes are detailed in the corporate process map.

This framework establishes a first phase of identification, in which those responsible for each process must identify the operational risks associated with their processes, establish effective mitigating controls and systematically execute the control framework. The set of risks identified under their area, as well as their mitigating controls, form part of the map of operational risks.

The second phase of the framework consists of the management of operational loss events by those responsible for each process, ensuring that each loss event (and its recoveries) is logged including detailed information and linking each event to a risk.

There is a central operational risk unit that oversees the map of operational risks, providing support and giving advice to process managers to properly define the risks, ensuring the integrity and completeness of the loss event log and their correct entry against the corresponding risks and coordinating the map's ongoing assessment process.

The Board of Directors is directly involved in managing this risk, by (1) approving the Operational Risk Policy that defines the risk management framework, (2) defining the Group's appetite for operational risk, and (3) monitoring the Group's risk profile via the Board Risk Committee, through specific reports with information on the main operational risks (including, among others, ICT, conduct and fraud).

Within operational risk, the following risks are also managed and controlled:

• Conduct risk: broadly speaking, this is defined as the current or future possibility of incurring losses due to the inadequate provision of financial services or any other activity carried out by the Institution, due to misconduct with customers (existing or potential), employees (in relation to human rights, equality, well-being, inclusion, and health & safety in the workplace), shareholders and suppliers, markets, political parties or society in general, including cases of wilful misconduct or negligence.
• Information and Communications Technology (ICT) risk: defined as the current or future risk of incurring losses due to inadequacies or failures of technical infrastructures' hardware and software, which could compromise the availability, integrity, accessibility, confidentiality and traceability of those infrastructures, tools and data, or due to the inability to change IT platforms within a reasonable timeframe and at a reasonable cost when the environment or business requirements change. This also includes security risks resulting from inadequate or failed internal processes or external events, including cyberattacks, or inadequate physical security in data centres.
• Outsourcing risk: current or future risk of incurring losses as a result of using resources and/or media of a third party for the standard, ongoing and stable performance over time of certain processes of the outsourcing company, which in itself entails exposure to a series of underlying risks, such as operational risk, including conduct risk, ICT risk, reputational risk, concentration risk and lock-in risk.
• Model risk: current or potential future loss an institution may incur, as a consequence of decisions that could be principally based on the output of internal models, due to errors in the development, implementation or use of such models.
• Tax risk: the possibility of failing to achieve the objectives set out in Banco Sabadell's tax strategy from a dual perspective due to either internal or external factors:
  • On one hand, the possibility of failing to fulfil tax obligations, potentially resulting in a failure to pay taxes that are due, or the occurrence of any other event that could potentially prevent the Bank from achieving its goals.
• On the other hand, the possibility of paying taxes not actually due under tax obligations, thus negatively affecting shareholders and other stakeholders.
• Compliance risk: defined as the possibility of incurring legal or regulatory sanctions, material financial loss or loss to reputation as a result of failing to comply with laws, regulations, internal rules and codes of conduct applicable to banking activities.

Detailed information on the following risks is given here below.

4.4.4.1 ICT risk

In recent years, the importance, complexity and use of technology and data have increased even further in banking processes, especially in remote channels (online banking) as a result of the impact of Covid-19 and the growing use of outsourced cloud services. Consequently, the reliance on information systems and their availability is a key factor, as the Group and its critical service suppliers are more exposed to cyberattacks just like the other operators in the sector. The ongoing geopolitical conflicts have brought with them the risk of becoming a target for cyberattacks, generating the need to introduce back-up measures. This risk has been stabilised but remains an ever-present threat.

Furthermore, the Group is currently undergoing a process of transformation, based on the digitalisation and automation of processes, which increases the reliance on systems and the exposure to risks associated with this change, including digital fraud. ICT risk therefore remains one of the key focus areas of Banco Sabadell Group's risk management.

It should be mentioned that this risk is not only applicable to the Group's own systems and processes, but it is also applicable to suppliers, given the widespread use of third parties for support in technological and business processes, and this therefore represents a material risk when it comes to managing outsourcing. On the topic of IT outsourcing, in 2022 a project was implemented in Spain, concentrating the number of application development, maintenance and testing providers in a small group of main industry-leading suppliers, thus requiring a greater level of supplier control and monitoring and the need for special oversight and adjustment throughout 2023 and 2024, reducing with this small number of leading providers the likelihood of experiencing cybersecurity incidents in this area.

In order to holistically and adequately manage all risks related to technology and data, the Institution classifies these risks into eight categories, in line with the Guidelines on ICT and security risk management (EBA/GL/2019/04):

• IT security (cybersecurity): risk of unauthorised access to IT systems, and of there being an impact on the confidentiality, availability, integrity and traceability of the information (data and metadata) that they contain (including cyberattacks and deliberate action), as well as the potential repudiation of digital operations.
• IT availability (technological resilience): risk of critical services provided to customers and employees becoming affected by systems failures.
• IT outsourcing: risk that engaging a third party, its management or related IT services produces a negative effect on the Institution's performance (including impacts on customers, as well as reputational, regulatory or financial impacts).
• IT change: risk arising from the inability of the organisation to manage IT system changes in a timely and controlled manner, in particular for large and complex change programmes that could potentially impact the availability and/or confidentiality of information or which could result in a failure to meet the business expectations that prompted those changes. In addition, the continued use of obsolete IT systems, without the required upgrades, could jeopardise the IT activities of the organisation or the execution of strategic programmes with a strong IT component (e.g. digital transformation programmes).
• IT data integrity: risk of the data stored and processed by IT systems being incomplete, inaccurate or inconsistent across different IT systems, for example as a result of weak or absent IT controls during the different phases of the IT data life cycle (i.e. designing the data architecture, building the data model and/or data dictionaries, verifying data inputs, controlling data extractions, transfers and processing, including rendered data outputs), impairing the ability to provide services and produce (risk) management and financial information in a correct and timely manner.
• IT governance: risk arising from inadequate or insufficient management and use of technology, as well as a poor alignment of these technologies and their intended uses with the business strategy.
• Technological transformation: risk associated with inappropriate adoption or inefficient use of technology within the organisation for the development of new value propositions.
• IT skills: risk arising from the insufficiency of adequate IT profiles (internal and/or external partners) to ensure effective and efficient coverage of technological activities, processes and services.

4.4.4.2 Tax risk

With regard to tax risk, Banco Sabadell Group's tax risk policies aim to establish the general guidelines for managing and controlling tax risk, specifying the applicable principles and critical parameters and covering all significant elements to systematically identify, assess and manage any risks that may affect the Group's tax strategy and fiscal objectives, meeting the requirements of the Spanish Capital Companies Act and of Banco Sabadell Group stakeholders.

In terms of tax risk, Banco Sabadell Group aims to fulfil its tax obligations at all times, adhering to the existing legal framework in this regard.

Banco Sabadell Group's tax strategy, approved by the Board of Directors, reflects its commitment to fostering responsible taxation, promoting preventive measures and developing key transparency schemes in order to gain the confidence and trust of its various stakeholders.

The tax strategy is governed by the principles of efficiency, prudence, transparency and mitigation of tax risk, and it is aligned with the business strategy of Banco Sabadell Group.

The Board of Directors of Banco Sabadell, under the mandate set out in the Spanish Capital Companies Act for the improvement of corporate governance, is responsible, and cannot delegate such responsibility, for the following:

• Setting the Institution's tax strategy.
• Approving investments and operations of all types which are considered to be strategic or to carry considerable tax risk due to their high monetary value or particular characteristics, except when such approval corresponds to the Annual General Meeting.
• Approving the creation and acquisition of shareholdings in special purpose entities or entities registered in countries or territories classified as tax havens.
• Approving any transaction which, due to its complexity, might undermine the transparency of the Institution and its Group.

Consequently, the duties of the Board of Directors of Banco Sabadell include the obligation to approve the corporate tax policy and ensure compliance therewith by implementing an appropriate control and oversight system, which is enshrined in the general risk management and control framework of the Group.

4.4.4.3 Compliance risk

As regards compliance risk, one of the core aspects of the Group's policy, and the foundation of its organisational culture, is strict compliance with all legal provisions, meaning that the achievement of business objectives must be compatible, at all times, with adherence to the law and the established legal system. To that end, the Group has a Compliance division, whose mission is to promote and strive to attain the highest levels of Group compliance and ethics, mitigating compliance risk, understood as the risk of legal or administrative sanctions, significant financial losses or loss of reputation due to a breach of laws, regulations, internal regulations and codes of conduct applicable to the Group's activity; minimising the possible occurrence of any regulatory breach and ensuring that any breaches that may occur are diligently identified, reported and resolved.

This division assesses and manages compliance risk through the following duties:

• Monitoring and overseeing the adaptation to new regulations through proactive management to ensure regular and systematic monitoring of legal updates, and ensuring the distribution of those which are deemed to have an impact on any area of the Institution's business, according to the scope established in the corresponding internal procedures.
• Identifying and periodically assessing compliance risks, in general, in the different areas of activity and contributing to their management in an efficient manner, setting and maintaining adequate procedures to prevent, detect and remediate any compliance risk.
• Establishing, in accordance with the above, an annual oversight and monitoring programme, with the appropriate tools and methodologies for control.
• With regard to Anti-Money Laundering, Countering the Financing of Terrorism (AML/CFT) and international sanctions, implementing, managing and updating policies and procedures on the topic of AML/CFT and international sanctions; carrying out the preliminary classification of the ML/TF risk of customers during the onboarding process; applying enhanced due diligence measures when onboarding high-risk customers so that they may be accepted and duly updated beforehand; managing tracking alerts; detecting matches in lists of designated persons and transactions of countries subject to international sanctions; performing special analyses of suspicious activities and reporting them as necessary; preparing training plans; approving new products, services, channels and business areas; and conducting a periodic risk assessment of internal control procedures in relation to AML/CFT and international sanctions.
• In terms of customer protection, advising the business units in the design of new products and services and changes in their scope, in accordance with MiFID, EBA and IDD regulations and any other applicable regulation, as well as supervising the correct advertising and marketing of products and services, in terms of conduct, transparency and vulnerable customers.
• With regard to market integrity, promoting compliance with the Internal Code of Conduct in relation to the securities market and the Market Abuse Regulation, as well as notifying the regulator of potential cases of misuse of information and/or market manipulation under investigation.
• In terms of customer data protection, through the Data Protection Officer (DPO), advising the business units in the adequate implementation of the General Data Protection Regulation in the design of products and services, as well as being the point of contact for the Spanish Data Protection Agency (Agencia Española de Protección de Datos).
• In the area of customer service, responding to customers' claims and complaints in a timely manner, in accordance with transparency criteria and supervisor's best practice, as well as detecting recurrent, systemic or potential problems of the Institution, promoting the adoption of corrective measures in that regard, and following up on their resolution.
• In the area of ethics and conduct, informing, reviewing or proposing corrective measures and/or responses to incidents detected in matters of the code of conduct or to consultations submitted to the Corporate Ethics Committee (CEC), whose mission is to promote the Group's ethical conduct to ensure compliance with the principles of action set forth in Banco Sabadell Group Code of Conduct, the Banco Sabadell Group General Policy on Conflicts of Interest and the Banco Sabadell Group Corporate Crime Prevention Policy, the Banco Sabadell Group Anti-Corruption Policy and the Banco Sabadell Group Policy on the Internal Reporting System and Protection of Reporting Persons. In addition, taking part in the process to formulate and review remuneration policies and practices.
• In relation to all compliance risks, monitoring the risk management activities carried out by the first line of defence to ensure they are in line with the established policies and procedures, in addition to coordinating inspections, responses to requirements from supervisors and regulators and overseeing compliance with their recommendations.
• With respect to the oversight of foreign and domestic subsidiaries and foreign branches, coordinating and liaising with them, with the aim of establishing a relationship of cooperation, regular exchange of information and support between Banco Sabadell's Compliance function and the compliance functions of these subsidiaries and foreign branches in order to prevent compliance risks at the local level.
• Promoting a culture of compliance and proper conduct within the Institution by adopting measures that guarantee the training and experience of employees to adequately perform their duties, as well as collaborating in the development of training programmes in order to advise and make employees aware of the importance of complying with established internal procedures.
• Submitting to the governing bodies regular or ad hoc reports on compliance as may be legally required at any given time and such material compliance information as may arise from all units and activities of the Institution. Assisting the Board of Directors or Senior Management in compliance matters.
• Taking on institutional responsibilities and interacting with supervisory authorities and institutions in relation to matters within its remit and where agreed by the Institution's management and administrative bodies.

The following compliance risks have been identified:

• Anti-money laundering and countering the financing of terrorism.
• Data protection.
• Market integrity.
• Customer protection (including the following risks: MiFID, EBA, other products and services, sustainability, misconduct with customers and advertising).
• New legislation.
• Ethics and conduct (includes risks related to corporate crime prevention, remuneration and the code of conduct and ethics).
• Customer Care Service (Servicio de Atención al Cliente, or SAC).

Note 5 – Minimum own funds and capital management

Minimum own funds requirements

The Group calculates minimum own funds requirements in accordance with the regulatory framework based on Regulation (EU) 575/2013 (CRR), which sets forth the capital and solvency requirements, and Directive 2013/36/EU (CRD IV), in relation to prudential supervision. These regulations were amended in 2019 by Regulation (EU) 2019/876 (CRR II) and by Directive (EU) 2019/878 (CRD V) to reflect the standards established by the Basel Committee on Banking Supervision, known as Basel III. However, to implement the pending items of the Basel III reform agreed in December 2017 by the Basel Committee on Banking Supervision (BCBS), the aforesaid regulations were subsequently amended in 2024 by Regulation (EU) 2024/1623 (CRR III) and by Directive (EU) 2024/1619 (CRD VI), respectively. The CRR III regulation is applicable in the European Union, as a general rule, as from 1 January 2025 and the CRD VI directive should be transposed into Spanish law no later than 10 January 2026 and shall be applicable, as a general rule, as from 11 January 2026.

The Covid-19 health crisis prompted competent institutions in Europe to temporarily lower the liquidity, capital and operational requirements applicable to banks, to ensure that they could continue carrying out their role of providing funding to the real economy. These transitional provisions ended in December 2024, as established in Regulation (EU) 2020/873, although they did not have any impact on the Institution as the phase-in ratios coincide with the fully-loaded ratios.

In accordance with the aforesaid regulatory framework, credit institutions must comply with a total capital ratio of 8% at all times. However, regulators may exercise their authority and require institutions to maintain additional capital.

On 30 November 2023, Banco Sabadell received the decision of the European Central Bank concerning the minimum prudential requirements applicable as from 1 January 2024, as a result of the Supervisory Review and Evaluation Process (SREP). The requirement, on a consolidated basis, was that Banco Sabadell should keep a phase-in Common Equity Tier 1 (CET1) ratio of at least 8.93% and a phase-in Total Capital ratio of at least 13.42%. These ratios include the minimum required by Pillar 1 (8%, of which 4.50% corresponds to CET1), the Pillar 2 Requirement, or Pillar 2R (2.25%, of which 1.27% must be met with CET1), the capital conservation buffer (2.50%), the requirement applicable due to the Bank's status as an 'other systemically important institution' (0.25%), and the countercyclical buffer (0.42%) that stems from the Bank of England's Financial Policy Committee (FPC) decision to increase the countercyclical buffer from 1% to 2% from 5 July 2023.

On 1 October 2024, the Bank of Spain approved the new framework to calculate the countercyclical capital buffer and established that, for exposures located in Spain, the countercyclical buffer percentage shall be 0.5%, applicable as from 1 October 2025. Thereafter, and provided that cyclical systemic risks are maintained at a standard level, the buffer percentage will be raised to 1% as from the fourth quarter of 2025 (to be applicable as from 1 October 2026). This second increase of the countercyclical buffer will be confirmed at a later date by a new decision to be taken by the Bank of Spain.

On 11 December 2024, Banco Sabadell received the decision of the European Central Bank concerning the minimum prudential requirements applicable as from 1 January 2025 as a result of the Supervisory Review and Evaluation Process (SREP). The requirement, on a consolidated basis, is that Banco Sabadell should keep a phase-in Common Equity Tier 1 (CET1) ratio of at least 8.95% and a phase-in Total Capital ratio of at least 13.44%. These ratios include the minimum required by Pillar 1 (8%, of which 4.50% corresponds to CET1), the Pillar 2 Requirement, or Pillar 2R (2.25%, of which 1.27% must be met with CET1), the capital conservation buffer (2.50%), the requirement applicable due to the Bank's status as an 'other systemically important institution' (0.25%), and the countercyclical buffer (0.44%).

As at 31 December 2024, the Group's phase-in CET1 capital ratio stood at 13.02% (13.19% as at 31 December 2023) and its phase-in total capital ratio was 17.60% (17.76% as at 31 December 2023); therefore, the capital requirements indicated in the preceding points are being comfortably met.

The following table sets out the minimum prudential requirements applicable to Banco Sabadell Group following the Supervisory Review and Evaluation Process (SREP) for the years 2023-2025:

	2025	2024	2023
Pillar 1 CET1	4.50 %	4.50 %	4.50 %
Pillar 2 Requirement	1.27 %	1.27 %	1.21 %
Capital conservation buffer	2.50 %	2.50 %	2.50 %
Systemic buffer	0.25 %	0.25 %	0.25 %
Countercyclical buffer (*)	0.44 %	0.42 %	0.19 %
Common Equity Tier 1 (CET1) ratio	8.95 %	8.93 %	8.65 %

Dates of communication of the SREP outcome 11/12/2024 30/11/2023 14/12/2022

(*) As from 1 October 2025, the countercyclical buffer in Spain will rise to 0.5%, increasing the Group's overall countercyclical buffer.

On a standalone basis, the requisite Common Equity Tier 1 (CET1) ratio to be attained as at 31 December 2024 is 7.29% and the required Total Capital ratio is 10.79%. This requirement includes the minimum required by Pillar 1 (8%, of which 4.50% corresponds to CET1), the capital conservation buffer (2.50%) and the requirement stemming from the calculation of the specific countercyclical capital buffer which, as at 31 December 2024, was 0.29%.

As at 31 December 2024, Banco Sabadell had a CET1 capital ratio of 13.31% (13.65% as at 31 December 2023) and a phase-in Total Capital ratio of 17.79% (18.04% as at 31 December 2023), both also well above the standalone capital requirements.

Requirements related to the restructuring and resolution of credit institutions

On 15 May 2014, Directive 2014/59/EU was published in the Official Journal of the European Union, establishing a framework for the recovery and resolution of credit institutions and investment firms, known as the Bank Recovery and Resolution Directive (BRRD).

The BRRD was transposed into Spanish law through the publication of Royal Decree 1012/2015 of 6 November 2015, implementing Law 11/2015 of 18 June 2015 on the recovery and resolution of credit institutions and investment firms.

The BRRD arises from the need to establish a regime that provides authorities with a credible set of tools to intervene sufficiently early and quickly in an unsound or failing institution so as to ensure the continuity of the Institution's critical financial and economic functions, to avoid significant adverse repercussions for financial stability, and to adequately protect public funds by minimising reliance on extraordinary public financial support. Likewise, covered depositors enjoy special treatment.

The regime proposed by the BRRD is based on the principle that traditional insolvency proceedings are not, in many cases, the best option to achieve the aforementioned objectives. That is why the BRRD introduces the resolution procedure, whereby competent resolution authorities obtain administrative powers to manage a failing institution.

The preamble of Law 11/2015 defines a resolution process as a unique administrative process to address the failure of credit institutions and investment firms, when an insolvency proceeding is not appropriate for reasons of public interest and financial stability. In order to achieve the aforementioned objectives, the BRRD envisages a series of instruments available to the competent resolution authority, including a bail-in tool. The BRRD introduces for this purpose a minimum requirement for own funds and eligible liabilities (MREL) that institutions must comply with at all times in order to ensure their loss-absorbing capacity is sufficient to guarantee the effective implementation of the resolution tools and that, in the current regulatory environment, would be the amount of own funds and eligible liabilities expressed as a percentage of the Institution's total liabilities and own funds.

Similarly, in 2015 the FSB defined the Total Loss-Absorbing Capacity (TLAC) requirement, also designed to ensure that institutions have sufficient capacity to absorb losses and execute a bail-in in the event of resolution. It should be noted that this requirement only applies to Global Systemically Important Banks (G-SIBs); therefore, it does not apply to Banco Sabadell Group.

In June 2019, after more than two and a half years of negotiations, a reform of the bank resolution framework was agreed with the approval of the new resolution directive, BRRD II (Directive 2019/879), which implements the international TLAC standard in the EU. BRRD II was transposed into Spanish law by Royal Decree-Law 7/2021 of 27 April 2021.

Responsibility for determining MREL falls to the Single Resolution Board (SRB), pursuant to that set forth in Regulation (EU) No 806/2014, also revised in 2019 and replaced by Regulation (EU) 2019/877. Thus, the SRB, after consulting with the competent authorities, including the ECB, will establish the MREL for each bank, taking into consideration aspects such as the size, funding model, risk profile and the risk of contagion to the financial system, among others.

In May 2024, the SRB published the MREL Policy under the Banking Package, which integrates the regulatory changes of the aforesaid resolution framework reform.

On 17 December 2024, Banco Sabadell received a communication from the Bank of Spain regarding the decision made by the Single Resolution Board (SRB) concerning the minimum requirement for own funds and eligible liabilities (MREL) and of the subordination requirement applicable to the Institution on a consolidated basis. These new requirements are based on balance sheet data as at December 2023.

The new requirements that must be met as from 17 December 2024 are as follows:

• The MREL requirement is 22.14% of the Total Risk Exposure Amount (TREA) and 6.39% of the Leverage Ratio Exposure (LRE).
• The subordination requirement is 15.84% of the TREA and 6.39% of the LRE.

The own funds used by the Institution to meet the Combined Buffer Requirement (CBR) will not be eligible to meet the MREL and subordination requirements expressed in terms of the TREA.

In the calibration of the MREL requirement, the Group has obtained the maximum possible reduction of 20% of the Market Confidence Charge (MCC) taking into account the progress shown in its level of resolvability and based on the provisions of Article 12d(3) of Regulation (EU) 2019/877, which states that the SRB has the power to establish a lower amount of said component in the calibration process of the MREL requirement.

	Previous requirements (*)		New requirements
	% TREA	% LRE	% TREA	% LRE
MREL Requirement (**)	22.52%	6.35%	22.14%	6.39%
Subordination Requirement (**)	17.31%	6.35%	15.84%	6.39%

(*) Effective from 1 January 2024 to 16 December 2024.

(**) The MREL and subordination requirements as a % of the TREA do not include capital used to meet the CBR.

In 2024, the Group issued 1 billion euros of MREL-eligible senior non-preferred debt and 750 million euros plus 450 million pounds sterling of senior preferred debt (see Note 4.4.3.1 - Liquidity and funding risk).

Banco Sabadell is compliant with the new MREL requirements, as shown below:

		MREL ratio		Subordination ratio
	% TREA	% LRE	% TREA	% LRE
MREL 31 December 2024 (*)	24.66%	9.54%	20.49%	8.11%
MREL 31 December 2023 (*)	24.73%	9.34%	20.13%	7.80%

(*) The MREL and subordination ratios as a % of the TREA shown in this table do not include capital used to meet the CBR.

Furthermore, the Institution's Funding Plan anticipates that it will continue to comply, comfortably, with the current requirements in force.

Capital management

The management of capital resources is the result of an ongoing capital planning process This process considers the evolution of the economic, regulatory and sectoral environment. It takes into account the expected capital consumption of different activities, under the various envisaged scenarios, and the market conditions that could determine the effectiveness of the various actions being considered. The process is enshrined within the Group's strategic objectives and aims to achieve an attractive return for shareholders, whilst also ensuring that its level of own funds is appropriate in terms of the risks inherent in banking activity.

As regards capital management, as a general policy, the Group aims to adjust its available capital to its overall level of risks incurred.

The Group follows the guidelines set out in CRD-V and associated regulations, as well as their successive updates, in order to establish own funds requirements that are inherent in the risks actually incurred by the Group, based on independently validated internal risk measurement models. To this end, the Group has been authorised by the supervisor to use the majority of its internal models to calculate regulatory capital requirements.

The Group carries out frequent backtesting exercises on its IRB models, at least once a year. These backtesting exercises are carried out independently by the Models and Internal Validation unit and reported for monitoring purposes to the established internal governing bodies, such as the Models Committee, the Technical Risk Committee and the Board Risk Committee (delegated Board committee). Additionally, the backtesting results that affect the risk parameters used to calculate regulatory capital and the main conclusions drawn from those results are included in the annual Pillar 3 Disclosures report, taking into account the criteria established by the EBA in its disclosure guidelines.

Banco Sabadell Group carries out an Internal Capital Adequacy Assessment Process (ICAAP) on a consolidated and ongoing basis throughout the year in order to generate a relevant, up-to-date, fully comprehensive and forward-looking appraisal of the adequacy of its levels of capital, considering the Group's business model and the risks taken.

The ICAAP is carried out under a solid governance framework, with high levels of involvement from Senior Management. The ultimate responsibility for its review and approval lies with the Board of Directors.

The ICAAP is seen as a complementary tool to Basel Pillar 1 (regulatory capital), which first analyses the Group's business model within its economic, financial and regulatory context, and its short- and mediumterm sustainability and viability. The Group's business model involves taking risks and a risk profile is therefore defined. As part of the ICAAP, an identification is made of the material risks and of the main threats and vulnerabilities derived from the Group's activity and a self-assessment is carried out of the inherent and residual risk that they entail, after considering the risk governance, management and control systems.

Based on the inventory of the Group's material risks and their management, a comprehensive quantitative assessment of the necessary capital based on internal approaches (economic capital) is established, the scope of which goes beyond the risks covered by Pillar 1, integrating the models used by the Group (for example, borrower rating systems: credit ratings and credit scores) and other internal estimates appropriate to each type of risk.

In addition, the ICAAP includes forward-looking analyses with a three-year time horizon (or even a 30-year time horizon in the case of scenarios designed to forecast climate risk). These analyses are carried out under a baseline economic scenario, but also under plausible albeit unlikely adverse scenarios (stress tests), which are relevant to the Group and, therefore, reflect adverse situations, both in the economic environment and those of an idiosyncratic nature, that could have a particular impact on the Group. The baseline forecast includes the Group's business and financial plans. These forecasting exercises are carried out to verify whether the business performance, risk and income statement in possible adverse scenarios could compromise the Group's solvency based on the available own funds, or affect the Group's compliance with its Risk Appetite Statement. As a result of these exercises, weaknesses can be detected and, if necessary, action plans can be proposed to mitigate the identified risks.

Forward-looking analyses under adverse scenarios are supplemented with reverse stress tests, which identify the Group's idiosyncratic characteristics that could entail a material vulnerability for its solvency if they were to materialise.

The combination of the different solvency measurements (static or dynamic and regulatory or economic), taking into account the inventory of risks affecting the Group and the main vulnerabilities detected, enables the Board of Directors, as the body ultimately responsible for the ICAAP, to draw a conclusion regarding the Group's solvency position.

The level and quality of capital are Group RAS metrics and their management and control are governed by the Group's Risk Appetite Framework (RAF).

The Group has implemented a Risk-adjusted Return on Capital (RaRoC) metric in segments where this is considered relevant. This metric is embedded in the pricing management system and is therefore subject to the Institution's policies and procedures. In addition to being used in the pricing process, this metric can measure the return obtained on each transaction and customer and even by each business unit, which makes it possible to make like-for-like comparisons.

Banco Sabadell has a Capital Contingency Plan (CCP) in place, which sets forth the strategy to ensure that the Group has sufficient management capabilities and measures in place to minimise the negative impacts of a capital contingency and return to a business-as-usual situation. The CCP is part of the Internal Crisis Management Framework (ICMF) and is intended to respond to potential contingencies (serious, but unlikely to occur) that could have an impact on capital in the short term; these would be less severe than a crisis, but might affect other areas, such as liquidity, thereby comprising the Group's continuity. The activation of the CCP may occur in response to systemic, idiosyncratic or combined contingencies. The CCP includes the governance process (preparation, approval and updating), the key processes involved in its implementation (identification, activation, management and closure) and the capital measures to be applied in different contingency situations or crises associated with its activation. No specific reporting process is defined for the CCP; instead, there is a general framework for action that is underpinned by protocols and by the reporting structure already in place.

Eligible capital and capital ratios

As at 31 December 2024, the Group's eligible capital amounts to 14,181 million euros (13,926 million euros as at 31 December 2023), representing a surplus above minimum capital requirements of 3,356 million euros (3,480 million euros as at 31 December 2023), as shown below:

Thousand euro
	2024	2023	Year-on-year change (%)
Capital	680,028	680,028	—
Reserves (includes profit attributable to the Group, net of dividends) (*)	13,158,609	13,198,328	(0.30)
Valuation adjustments	(361,206)	(471,695)	(23.42)
Deductions	(2,992,477)	(3,059,900)	(2.20)
CET1 capital	10,484,954	10,346,761	1.34
CET1 (%)	13.02	13.19	(1.33)
Preference shares, convertible bonds and deductions	1,750,000	1,750,000	—
Additional Tier 1 capital	1,750,000	1,750,000	—
AT1 (%)	2.17	2.23	(2.69)
Tier 1 capital	12,234,954	12,096,761	1.14
Tier 1 (%)	15.19	15.42	(1.49)
Tier 2 capital	1,945,862	1,829,460	6.36
Tier 2 (%)	2.42	2.33	3.86
Capital base	14,180,816	13,926,221	1.83
Minimum capital requirement (*)	10,825,305	10,445,833	3.63
Capital surplus	3,355,511	3,480,388	(3.59)
Total capital ratio (%)	17.60	17.76	(0.90)
Risk weighted assets (RWAs)	80,559,227	78,427,616	2.72

(*) 2024 reserves adjusted by the amount corresponding to the share buyback programme to be paid out of 2023 earnings, which was suspended on 9 May and of which 247 million euros remain pending execution, as well as the share buyback programme to be executed in 2025, which will amount to 755 million euros, corresponding to the CET1 in excess of the 13% fully-loaded ratio. As at the sign-off date of these consolidated annual financial statements, both programmes are pending approval by the Annual General Meeting, having obtained prior authorisation from the competent authority.

(**) Minimum capital requirements have been calculated taking into account capital requirements in effect as at 2024 year-end for Pillar 1 (8%) and Pillar 2R (2.25%), as well as the capital conservation buffer (2.50%), countercyclical buffer (0.44%) and the buffer for other systemically important institutions (0.25%).

Common Equity Tier 1 (CET1) capital accounts for 73.94% of eligible capital. Deductions mainly comprise intangible assets, goodwill and deferred tax assets.

Tier 1 comprises, in addition to CET1 funds, items that largely make up Additional Tier 1 capital (12.34% of own funds), which are capital items comprised of preferred securities.

Tier 2 capital provides 13.72% of the Total Capital ratio and is made up largely of subordinated debt. Regarding subordinated debt, it is worth noting the issue of Subordinated Debt 1/2024 for 500 million euros carried out on 27 March 2024, and the loss of eligibility of the Subordinated Debt issue 1/2020 in the amount of 300 million euros after it was announced, on 18 November 2024, that the early redemption option was to be exercised on 17 January 2025, in accordance with the issue's terms and conditions.

Risk-Weighted Assets (RWAs) changed by 2,132 million euros in the period. The change in credit RWAs is essentially due to the growth of lending and the implementation of new models, partially offset by improved portfolio density and by securitisations carried out in the year (one synthetic securitisation carried out in June 2024 on a 1.1 billion euro project finance portfolio, one traditional securitisation carried out in September 2024 on a 750 million euro consumer loan portfolio, and one synthetic securitisation carried out in December 2024 on a 1.23 billion US dollar portfolio of corporate loans and project finance). Lastly, the increase in operational RWAs is significant due to the increase of the relevant income indicator used in the annual update of the operational risk calculation.

CRR III and CRD VI entered into force on 1 January 2025 and introduce a number of changes in the calculation of capital requirements, in relation to all the different risks, as well as the entry into force of the so-called Output Floor. In the case of Banco Sabadell, CRR III entails a reduction of its RWAs, mainly arising from the changes applicable to the advanced measurement approach in the calculation of credit risk. These savings are partially offset mainly by the increase in RWAs due to the new calculation approach for operational risk.

In fully-loaded terms, the Common Equity Tier 1 (CET1) ratio stood at 13.02% and the Total Capital ratio stood at 17.60% as at 31 December 2024, both well above the regulatory minima.

The following table shows movements in the various regulatory capital components during 2024 and 2023:

Thousand euro
CET1 balance as at 31 December 2022	10,082,751
Reserves (includes profit attributable to the Group, net of dividends) (*)	359,427
Valuation adjustments	170,206
Deductions and transitory effects	(242,280)
CET1 balance as at 31 December 2023	10,346,761
Reserves (includes profit attributable to the Group, net of dividends) (**)	-39,720
Valuation adjustments	110,490
Deductions and transitory effects	67,423
CET1 balance as at 31 December 2024	10,484,954

(*) The movement in Reserves in 2023 includes -204 million euros corresponding to the share buyback carried out in 2023.

(**) In 2024, reserves were adjusted by the amount corresponding to the share buyback programme to be paid out of 2023 earnings, which was suspended on 9 May and of which 247 million euros remain pending execution, as well as the share buyback programme to be executed in 2025, which will amount to 755 million euros, corresponding to the CET1 capital in excess of the 13% fully-loaded ratio. As at the sign-off date of these consolidated annual financial statements, both programmes are pending approval by the Annual General Meeting, having obtained prior authorisation from the competent authority.

Thousand euro
Additional Tier 1 balance as at 31 December 2022	1,650,000
Eligible instruments	100,000
Additional Tier 1 balance as at 31 December 2023	1,750,000
Eligible instruments	—
Additional Tier 1 balance as at 31 December 2024	1,750,000

Thousand euro
Tier 2 balance as at 31 December 2022	1,855,001
Eligible instruments	(99,745)
Credit risk adjustments	17,874
Deductions and transitory effects	56,330
Tier 2 balance as at 31 December 2023	1,829,460
Eligible instruments	100,250
Credit risk adjustments	16,152
Deductions and transitory effects	—
Tier 2 balance as at 31 December 2024	1,945,862

The table below shows the reconciliation of equity and regulatory capital as at 31 December 2024 and 2023:

Thousand euro

	2024	2023
Shareholders' equity (*)	14,387,583	14,343,946
Accumulated other comprehensive income	(391,103)	(498,953)
Minority interests	34,416	34,213
Total equity	14,030,897	13,879,206
Goodwill and intangibles	(2,226,251)	(2,189,218)
Dividends (**)	(666,956)	(503,988)
TLCFs and thresholds for non-monetisable DTAs	(297,436)	(490,572)
Deductions	(289,626)	(257,415)
Other adjustments	(65,674)	(91,252)
Regulatory accounting adjustments	(3,545,943)	(3,532,445)
Common Equity Tier 1 capital	10,484,954	10,346,761
Additional Tier 1 capital	1,750,000	1,750,000
Tier 2 capital	1,945,862	1,829,460

Total regulatory capital 14,180,816 13,926,221 (*) In 2024, own funds were adjusted by the amount corresponding to the share buyback programme to be paid out of 2023 earnings, which was suspended on 9 May and

of which 247 million euros remain pending execution, as well as the share buyback programme to be executed in 2025, which will amount to 755 million euros, corresponding to the CET1 capital in excess of the 13% fully-loaded ratio. As at the sign-off date of these consolidated annual financial statements, both programmes are pending approval by the Annual General Meeting, having obtained prior authorisation from the competent authority.

(**) Does not consider the interim dividend recognised in the accounts.

As at 31 December 2024 and 2023, there was no significant difference between the accounting scope of consolidation and the regulatory scope of consolidation.

Risk-weighted assets amount to 80,559 million euros as at 31 December 2024, representing a balance variation of 2.72% with respect to 31 December 2023.

The breakdown of risk-weighted assets by type of risk, as at 31 December 2024 and 2023, is shown below:

Thousand euro

	2024		2023
	Amount	%	Amount	%
Credit risk (*)	69,841,795	86.70 %	68,970,951	87.94 %
Operational risk	10,063,260	12.49 %	9,008,555	11.49 %
Market risk	654,172	0.81 %	448,110	0.57 %
Total	80,559,227	100.00 %	78,427,616	100.00 %

(*) Includes counterparty credit risk, due to the contribution made to the default guarantee fund of CCPs and due to securitisation positions. Certain impacts linked mainly to the completion of the IRB Repair Programme, which the Institution has decided to frontload, are also included. Not including the aforementioned supplementary items, credit RWAs measured under the standardised approach and using advanced models (including deferred tax assets and the impact on RWAs after applying the prudential adjustments requested by the supervisor (SSM)) amount to 69,160 million euros.

The following table shows the reasons for the variation in credit RWAs occurring during 2024 and 2023:

Thousand euro

	RWAs	Capital requirements (*)
Balance as at 31 December 2022	66,858,624	5,348,690
Change in business volume	(989,535)	(79,163)
Asset quality	(1,284,349)	(102,748)
Changes in models	326,000	26,080
Methodology, parameters and policies	294,000	23,520
Acquisitions and disposals	(60,000)	(4,800)
Exchange rate	287,882	23,031
Other (**)	686,000	54,880
Balance as at 31 December 2023	66,118,622	5,289,490
Change in business volume	787,814	63,020
Asset quality	(1,084,000)	(86,720)
Changes in models	2,077,000	166,160
Methodology, parameters and policies	(496,000)	(39,680)
Acquisitions and disposals	200,144	16,012
Exchange rate	619,000	49,520
Balance as at 31 December 2024	68,222,580	5,457,802

Excludes Credit Valuation Adjustment (CVA) requirements and contributions to the default guarantee fund of CCPs. The impacts linked primarily to the completion of the IRB Repair Programme, which the Institution has decided to front-load, are not included either, nor is the movement in RWAs linked to the retained tranches of securitisation transactions.

(*) Calculated as 8% of RWAs.

(**) The increase in the "Other" category is essentially due to the assignment, at a granular level, of a series of add-ons at TSB, which as at December 2022 were reported as "Other risk exposure amounts".

Details of risk-weighted assets for the risk with the largest volume (credit risk), broken down by geographical area as at 31 December 2024 and 2023, are included here below:

%	2024	2023
Spain	63.22 %	63.47 %
Rest of European Union	4.90 %	4.74 %
United Kingdom	19.90 %	19.60 %
Americas	11.18 %	11.36 %
Rest of the world	0.80 %	0.83 %
Total	100 %	100 %

Includes counterparty credit risk.

The leverage ratio aims to reinforce capital requirements by providing a supplementary measure that is not linked to the level of risk. Article 92 of the CRR II regulation establishes that a minimum leverage ratio of 3% is required as from June 2021; this percentage is comfortably exceeded by the Group as at 31 December 2024.

The phase-in leverage ratio as at 31 December 2024 and 2023 is shown below:

Thousand euro
	2024	2023
Tier 1 capital	12,234,954	12,096,761
Exposure	235,163,653	233,254,941
Leverage ratio	5.20 %	5.19 %

During 2024 the leverage ratio increased by 1 basis point with respect to the corresponding ratio as at 31 December 2023, due mainly to the increase in Tier 1 capital, partially offset by increased exposure due to lending growth. Tier 1 capital also improved during the period, mainly due to the positive evolution of Common Equity Tier 1 (CET1) capital due to the profit earned during the year.

For more information about capital management, capital ratios and the leverage ratio, their composition, details of parameters and their management, see the Pillar 3 Disclosures report, which is published annually and is available on the Group's website (www.grupbancsabadell.com), in the section "Shareholders and investors - Economic and financial information".

Note 6 – Fair value of assets and liabilities

Financial assets and financial liabilities

The fair value of a financial asset or financial liability at a given date is understood as the amount at which it could be sold or transferred, respectively, as at that date, between two independent and knowledgeable parties acting freely and prudently, under market conditions. The most objective and commonly used reference for the fair value of a financial asset or financial liability is the price that would be paid in an organised, transparent and deep market ("quoted price" or "market price").

When there is no market price for a particular financial asset or financial liability, the fair value is estimated based on the values established for similar instruments in recent transactions or, alternatively, by using mathematical valuation models that have been suitably tested by the international financial community. When using these models, the particular characteristics of the financial asset or financial liability to be valued are taken into account, particularly the different types of risks that may be associated therewith. Notwithstanding the foregoing, the limitations inherent in the valuation models that have been developed and possible inaccuracies in the assumptions and parameters required by these models may result in the estimated fair value of a financial asset or financial liability not exactly matching the price at which the asset or liability could be delivered or settled on the valuation date.

The fair value of financial derivatives quoted on an active market is the daily quoted price.

In the case of instruments for which quoted prices cannot be determined, prices are estimated using internal models developed by the Bank, most of which take data based on observable market parameters as significant inputs. In the remaining cases, the models make use of other inputs that rely on internal assumptions based on generally accepted practices within the financial community.

For financial instruments, the fair values disclosed in the financial statements are classified according to the following fair value levels:

• Level 1: fair values are obtained from the (unadjusted) prices quoted on active markets for that instrument.
• Level 2: fair values are obtained from the prices quoted on active markets for similar instruments, the prices of recent transactions, expected payment flows or other valuation techniques in which all significant inputs are directly or indirectly based on observable market data.
• Level 3: fair values are obtained through valuation techniques in which one or more significant inputs is not based on observable market data.

Set out below are the main valuation methods, assumptions and inputs used when estimating the fair value of financial instruments classified in Levels 2 and 3, according to the type of financial instrument concerned:

Level 2 financial instruments	Valuation techniques	Main assumptions	Main inputs used
Debt securities	Net present value method	Calculation of the present value of financial instruments as the present value of future cash flows (discounted at market interest rates), taking into account: - An estimate of pre-payment rates - Issuers' credit risk	- Issuer credit spreads - Observable market interest rates
Equity instruments	Sector multiples (P/BV)	Based on the NACE code that best represents the company's primary activity, the price-to-book value (P/BV) ratio obtained from peers is applied	- NACE codes - Quoted prices in organised markets
Simple derivatives (a)	Net present value method	Implicit curves calculated based on quoted market prices	- Observable yield curve - FX swaps curve and spot curve
Other derivatives (a)		- For equity derivatives, FX or commodities: Black-Scholes model: a lognormal distribution is assumed for the underlying asset with volatility depending on the term	- Forward structure of the underlying asset, given by market data (dividends, swap points, etc.). - Volatility surfaces of options
	Analytic/ semi-analytic formulae	- For interest rate derivatives: Normal model and shifted Libor Market Model: negative rates and forward rates in the term structure of the interest rate curve are fully correlated. For calculation of CVA and DVA adjustments: Normal model and Black Scholes model	- Term structure of interest rates - Volatility surfaces of Libor rate options (caps) and swap rate options (swaptions) - Probability of default for calculation of CVA and DVA (b)
	Monte Carlo simulations	- For valuation of equity derivatives, FX or commodities: Black-Scholes model: a lognormal distribution is assumed for the underlying asset with volatility depending on the term	- Forward structure of the underlying asset, given by market data (dividends, swap points, etc.). - Volatility surfaces of options
	Hybrid local stochastic volatility models	- For FX derivatives: Tremor model: implicit volatility obtained through stochastic differential equations	- Forward structure of the underlying asset, given by market data (dividends, swap points, etc.). - Volatility surfaces of options
	For credit derivatives: - Intensity models	These models assume a default probability structure resulting from term based default intensity rates	- Price listings of Credit Default Swaps (CDS) - Historic volatility of credit spreads

(a) Given the small net position of Banco Sabadell, the Funding Value Adjustment (FVA) is estimated to have a non-material impact on the valuation of derivatives.

(b) To calculate CVA and DVA, levels of severity fixed at 60% have been used, which corresponds to the market standard for senior debt. Average future, positive and negative exposures have been estimated using market models, Libor for interest rates and the Black-Scholes model for FX, using market inputs. The probability of default of customers with no quoted debt instruments or CDS have been obtained using the IRB model and for Banco Sabadell those obtained from the CDS market prices have been assigned.

Level 3 financial instruments	Valuation techniques	Main assumptions	Main non-observable inputs
Debt securities	Net present value method	Calculation of the present value of financial instruments as the present value of future cash flows (discounted at market interest rates), taking into account in each case: - An estimate of pre-payment rates - Issuers' credit risk - Other estimates of variables that affect future cash flows: claims, losses, redemptions	- Estimated credit spreads of the issuer or a similar issuer - Rates of claims, losses and/or redemptions
Loans and advances	Net present value method	Calculation of the present value of future cash flows discounted at market interest rates based on market scenarios	- Prepayment model
Equity instruments	Discounted cash flow method	Calculation of the present value of future cash flows discounted at market interest rates adjusted for risk (CAPM method), taking into account: - An estimate of the company's projected cash flows - Risk in the company's sector - Macroeconomic inputs	- The entity's business plans - Risk premiums of the company's sector - Adjustment for systemic risk (Beta Parameter)
Derivatives (a)	For credit derivatives: - Intensity models	These models assume a default probability structure resulting from term based default intensity rates	For credit derivatives: - Estimated credit spreads of the issuer or a similar issuer - Historic volatility of credit spreads
	For commodity derivatives: - Net present value method	Forward curve calculated based on adjusted quoted market prices	Unquoted futures curves

(a) Given the small net position of Banco Sabadell, the Funding Value Adjustment (FVA) is estimated to have a non-material impact on the valuation of derivatives.

Determination of the fair value of financial instruments

A comparison between the value at which the Group's main financial assets and financial liabilities are recognised on the accompanying consolidated balance sheets and their corresponding fair values is shown below:

Thousand euro

		2024		2023
	Note	Carrying amount	Fair value	Carrying amount	Fair value
Assets:
Cash, cash balances at central banks and other demand deposits	7	18,382,112	18,382,112	29,985,853	29,985,853
Financial assets held for trading	8,9,10	3,438,955	3,438,955	2,706,489	2,706,489
Non-trading financial assets mandatorily at fair value through profit or loss	8,9,11	168,267	168,267	153,178	153,178
Financial assets designated at fair value through profit or loss		—	—	—	—
Financial assets at fair value through other comprehensive income	9	6,369,913	6,369,913	6,269,297	6,269,297
Financial assets at amortised cost	8	196,520,273	193,995,144	180,913,793	175,310,626
Derivatives – Hedge accounting	12	2,394,902	2,394,902	2,424,598	2,424,598
Total assets		227,274,422	224,749,293	222,453,208	216,850,041

Thousand euro

	Note	2024		2023
		Carrying amount	Fair value	Carrying amount	Fair value
Liabilities:
Financial liabilities held for trading	10	2,381,434	2,381,434	2,867,459	2,867,459
Financial liabilities designated at fair value through profit or loss		—	—	—	—
Financial liabilities at amortised cost	18, 19, 20, 21	220,228,249	220,629,706	216,071,766	215,366,894
Derivatives – Hedge accounting	12	803,999	803,999	1,171,957	1,171,957
Total liabilities		223,413,682	223,815,139	220,111,182	219,406,310

As shown in the first table of this Note, as at 31 December 2024 the fair value of financial assets at amortised cost is approximately 2,525 million euros below their carrying amount. This difference is explained for the most part by the impact of interest rates on the fair value of fixed-rate mortgages granted by the Group to its customers in Spain and the United Kingdom in previous years.

Financial instruments at fair value

The following tables show the main financial instruments recognised at fair value in the accompanying consolidated balance sheets, broken down according to the valuation method used to estimate their fair value:

Thousand euro

		2024
	Note	Level 1	Level 2	Level 3	Total
Assets:
Financial assets held for trading		1,416,725	2,020,954	1,276	3,438,955
Derivatives	10	—	2,017,999	—	2,017,999
Equity instruments	9	541,005	—	—	541,005
Debt securities	8	875,720	2,955	1,276	879,951
Non-trading financial assets mandatorily at		33,717	27,661	106,889	168,267
fair value through profit or loss
Equity instruments	9	20,088	27,243	19,718	67,049
Debt securities	8	13,629	418	46,658	60,705
Loans and advances	11	—	—	40,513	40,513
Financial assets at fair value through other		4,556,322	1,728,153	85,438	6,369,913
comprehensive income
Equity instruments	9	434	136,668	56,478	193,580
Debt securities	8	4,555,888	1,591,485	28,960	6,176,333
Derivatives – Hedge accounting	12	—	2,394,902	—	2,394,902
Total assets		6,006,764	6,171,670	193,603	12,372,037
Thousand euro

	Note	Level 1	Level 2	Level 3	Total
Liabilities:
Financial liabilities held for trading		82,671	2,298,763	—	2,381,434
Derivatives	10	—	2,298,763	—	2,298,763
Short positions		82,671	—	—	82,671
Derivatives – Hedge accounting	12	—	803,999	—	803,999
Total liabilities		82,671	3,102,762	—	3,185,433

Thousand euro

		2023
	Note	Level 1	Level 2	Level 3	Total
Assets:
Financial assets held for trading		142,495	2,563,994	—	2,706,489
Derivatives	10	—	2,563,994	—	2,563,994
Debt securities	8	142,495	—	—	142,495
Non-trading financial assets mandatorily at		31,255	15,974	105,949	153,178
fair value through profit or loss
Equity instruments	9	18,398	14,840	19,098	52,336
Debt securities	8	12,857	1,134	51,753	65,744
Loans and advances		—	—	35,098	35,098
Financial assets at fair value through other comprehensive income		4,656,989	1,522,988	89,320	6,269,297
Equity instruments	9	582	130,441	52,915	183,938
Debt securities	8	4,656,407	1,392,547	36,405	6,085,359
Derivatives – Hedge accounting	12	—	2,424,598	—	2,424,598
Total assets		4,830,739	6,527,554	195,269	11,553,562

Thousand euro

		2023
	Note	Level 1	Level 2	Level 3	Total
Liabilities:
Financial liabilities held for trading		337,373	2,530,086	—	2,867,459
Derivatives	10	—	2,530,086	—	2,530,086
Short positions		337,373	—	—	337,373
Derivatives – Hedge accounting	12	—	1,171,957	—	1,171,957
Total liabilities		337,373	3,702,043	—	4,039,416

Derivatives with no Credit Support Annexes (CSAs) include the Credit Valuation Adjustment (CVA) and Debit Valuation Adjustment (DVA), respectively, in their fair value. The fair value of these derivatives represents 5.41 % of the total, and their adjustment for credit and debit risks represents 1.45 % of their fair value as at 31 December 2024 (5.87 % and 4.12%, respectively, as at 31 December 2023).

Movements in the balances of financial assets and financial liabilities recognised at fair value and classified as Level 3, disclosed in the accompanying consolidated balance sheets, are shown below:

Thousand euro
	Assets	Liabilities
Balance as at 31 December 2022	167,264	—
Valuation adjustments recognised in profit or loss (*)	7,104	—
Valuation adjustments not recognised in profit or loss	(11,318)	—
Purchases, sales and write-offs	(1,184)	—
Net additions/(removals) in Level 3	(980)	—
Exchange differences and other	34,383	—
Balance as at 31 December 2023	195,269	—
Valuation adjustments recognised in profit or loss (*)	12,703	—
Valuation adjustments not recognised in profit or loss	4,597	—
Purchases, sales and write-offs	(21,196)	—
Net additions/(removals) in Level 3	(5,101)	—
Exchange differences and other	7,331	—
Balance as at 31 December 2024	193,603	—

(*) Relates to securities retained on the balance sheet.

Details of financial instruments that were transferred to different valuation levels in 2024 are as follows:

Thousand euro
---------------	--

				2024
	From:	Level 1		Level 2		Level 3
	To:	Level 2	Level 3	Level 1	Level 3	Level 1	Level 2
Assets:
Financial assets held for trading		—	—	—	—	—	—
Non-trading financial assets mandatorily at fair value through profit or loss		—	—	—	—	—	—
Financial assets designated at fair value through profit or loss		—	—	—	—	—	—
Financial assets at fair value through other comprehensive income		—	—	—	—	—	5,101
Derivatives		—	—	—	—	—	—
Liabilities:
Financial liabilities held for trading		—	—	—	—	—	—
Financial liabilities designated at fair value through profit or loss		—	—	—	—	—	—
Derivatives – Hedge accounting		—	—	—	—	—	—
Total		—	—	—	—	—	5,101

Details of financial instruments that were transferred to different valuation levels in 2023 are as follows:

Thousand euro

				2023
	From:	Level 1		Level 2		Level 3
	To:	Level 2	Level 3	Level 1	Level 3	Level 1	Level 2
Assets:
Financial assets held for trading		—	—	—	—	—	—
Non-trading financial assets mandatorily at fair value through profit or loss		—	—	—	—	—	—
Financial assets designated at fair value through profit or loss		—	—	—	—	5,500	—
Financial assets at fair value through other comprehensive income		687,365	4,520	—	—	—	—
Derivatives		—	—	—	—	—	—
Liabilities:
Financial liabilities held for trading		—	—	—	—	—	—
Financial liabilities designated at fair value through profit or loss		—	—	—	—	—	—
Derivatives – Hedge accounting		—	—	—	—	—	—
Total		687,365	4,520	—	—	5,500	—

Transfers from Level 1 to Level 2 in 2023 corresponded mainly to bonds issued by US government agencies for which, given their characteristics, it was determined that their market value should be obtained primarily using directly or indirectly observable market data.

As at 31 December 2024 and 2023, the effect of replacing the main assumptions used in the valuation of Level 3 financial instruments with other reasonably possible assumptions, taking the highest value (most favourable assumption) or lowest value (least favourable assumption) of the range that is considered likely, is not significant.

Financial instruments at amortised cost

The following tables show the fair value of the main financial instruments recognised at amortised cost in the accompanying consolidated balance sheets:

Thousand euro

2024
Level 1	Level 2	Level 3	Total
22,176,932	1,453,316	507,648	24,137,896
—	23,391,089	146,466,159	169,857,248
	24,844,405	146,973,807	193,995,144
	22,176,932

Thousand euro		2024
	Level 1	Level 2	Level 3	Total
Liabilities:
Financial liabilities at amortised cost (*):
Deposits (**)	—	186,444,247	—	186,444,247
Debt securities issued	24,684,793	1,980,924	1,069,612	27,735,329
Total liabilities	24,684,793	188,425,171	1,069,612	214,179,576

(*) As at 31 December 2024, the Group had other financial liabilities amounting to 6,450,130 thousand euros.

(**) The fair value of demand deposits has been likened to their carrying amount as they are mainly short-term balances.

Thousand euro
		2023
	Level 1	Level 2	Level 3	Total
Assets:
Financial assets at amortised cost
Debt securities	18,563,516	1,575,850	303,590	20,442,956
Loans and advances	—	20,952,925	133,914,744	154,867,669
Total assets	18,563,516	22,528,775	134,218,334	175,310,625
Thousand euro
		2023
	Level 1	Level 2	Level 3	Total
Liabilities:
Financial liabilities at amortised cost (*)
Deposits (**)	—	183,661,142	—	183,661,142
Debt securities issued	20,405,507	4,966,959	—	25,372,466
Total liabilities	20,405,507	188,628,101	—	209,033,608

(*) As at 31 December 2023, the Group had other financial liabilities amounting to 6,333,286 thousand euros.

(**) The fair value of demand deposits has been likened to their carrying amount as they are mainly short-term balances.

In general, the fair value of "Financial assets at amortised cost" and "Financial liabilities at amortised cost" has been estimated using the discounted cash flow method, applying market interest rates as at the end of each year adjusted for the credit spread and incorporating any behavioural assumptions deemed relevant, with the exception of debt securities with active markets, for which it has been estimated using year-end quoted prices.

The fair value of the heading "Cash, cash balances at central banks and other demand deposits" has been likened to its carrying amount, as these are mainly short-term balances.

Financial instruments at cost

As at the end of 2024 and 2023, there were no equity instruments valued at their acquisition cost that could be considered significant.

Non-financial assets

Real estate assets

As at 31 December 2024 and 2023, the net carrying amounts of real estate assets did not differ significantly from the fair values of these assets (see Notes 13, 15 and 17).

The selection criteria for appraisers and the update of appraisals are defined in the section on "Guarantees", in Note 1.3.4. to these consolidated annual financial statements.

Valuation techniques are generally used by all appraisal companies based on the type of each real estate asset.

As per regulatory requirements, in the valuation techniques used, appraisal companies maximise the use of observable market data and other factors which would be taken into account by market operators when setting prices, endeavouring to keep the use of subjective considerations and unobservable or non-verifiable data to a minimum.

The main valuation methods used fall into the following measurement levels:

Level 2

• Comparison method: applicable to all kinds of properties provided that there is a representative market of comparable properties and that sufficient data is available relating to transactions that reflect the current market situation.
• Rental update method: applicable when the valued property generates or may generate rental income and there is a representative market of comparable data.

– Statistical model: this model adjusts the value of the assets based on the acquisition date and their location, updating the value in accordance with price trends in the area concerned as from the date of purchase. To that end, it includes statistical information on price trends in all provinces, as provided by external appraisal companies, as well as demographic data from the Spanish Office for National Statistics (INE) to calculate sensitivity at a municipality level. The value obtained is in turn adjusted based on the construction status (finished product, development in progress, plots or land under management) and use (residential, industrial, etc.) of the asset.

Level 3

• Cost method: applicable to determine the value of buildings being planned, under construction or undergoing renovations.
• Residual method: in the present macroeconomic climate, the dynamic calculation procedure is being used preferentially in new land valuations to the detriment of the static procedure, which is reserved for specific cases in which the envisaged timeframes for project completion are in line with the relevant regulations.

Depending on the type of asset, the methods used for the valuation of the Group's portfolio are the following:

• Completed buildings: valued using the comparison method, the rental update method or the statistical model (Level 2).
• Buildings under construction: valued using the cost method as a sum of the land value and the value of the work carried out (Level 3).
• Land: valued using the residual method (Level 3).

Determination of the fair value of real estate assets

The following tables show the main real estate assets broken down by the valuation method used to estimate their fair value as at 31 December 2024 and 2023:

Thousand euro
	2024
	Level 1	Level 2	Level 3	Total
Housing	—	490,675	—	490,675
Branches and offices, retail establishments and other real estate	—	778,903	—	778,903
Land and building plots	—	—	22,754	22,754
Work in progress	—	—	347	347
Total assets	—	1,269,578	23,101	1,292,679
Thousand euro
		2023
	Level 1	Level 2	Level 3	Total
Housing	—	567,229	—	567,229
Branches and offices, retail establishments and other real estate	—	879,689	—	879,689
Land and building plots	—	—	26,128	26,128
Work in progress	—	—	1,225	1,225
Total assets	—	1,446,918	27,353	1,474,271

Significant unobservable variables used in valuations classed as Level 3 have not been developed by the Group but by the independent third party companies that performed the appraisals. Given the widespread use of the appraisals, whose valuation techniques are clearly set out in the regulation governing the valuation of properties, the unobservable variables used reflect the assumptions frequently used by all appraisal companies. In terms of proportional weight, unobservable variables account for almost all of the value of these appraisals.

The main unobservable variables used in the valuation of assets in accordance with the dynamic residual method are the future selling price, the estimated construction costs, the costs of development, the time required for land planning and development, and the discount rate. The main unobservable variables used in accordance with the static residual method are construction costs, the costs of development and the profit for the developer.

The number of plots in the Group's possession is very fragmented, and they are very diverse, both in terms of location and in terms of the stage of development of the urban infrastructure and the possibility of future development. For this reason, no quantitative information can be provided regarding the unobservable variables affecting the fair value of these types of assets.

Movements in the balances of real estate assets classified as Level 3 in 2024 and 2023 are shown below:

Thousand euro
	Housing	Branches and offices, retail establishments and other real estate	Land, building plots and work in progress
Balance as at 31 December 2022		— —	27,616
Purchases		— —	1,474
Sales		— —	(3,951)
Impairments recognised on income statement (*)		— —	(2,496)
Net additions/(removals) in Level 3		— —	4,710
Balance as at 31 December 2023		— —	27,353
Purchases		— —	3,461
Sales		— —	(4,026)
Impairments recognised on income statement (*)		— —	(3,575)
Net additions/(removals) in Level 3		— —	(112)
Balance as at 31 December 2024		— —	23,101

(*) Relates to assets retained on the balance sheet as at 31 December 2024 and 2023.

The following table shows a comparison between the value at which real estate assets are recognised under the headings "Investment properties", "Inventories" and "Non-current assets and disposal groups classified as held for sale" and their appraisal value, as at the end of 2024 and 2023:

Thousand euro			2024				2023
	Note	Carrying	amount (*) Impairment	Net carrying amount	Appraisal value	Carrying	amount (*) Impairment	Net carrying amount	Appraisal value
Investment properties	15	218,107	(60,966)	157,141	197,774	307,074	(77,476)	229,598	282,727
Inventories	17	101,588	(57,812)	43,776	71,803	130,437	(68,093)	62,344	100,962
Non-current assets held for sale	13	636,146	(174,722)	461,424	718,344	708,051	(180,911)	527,140	814,946
Total		955,841	(293,500)	662,341	987,921	1,145,562	(326,480)	819,082	1,198,635

(*) Cost less accumulated depreciation.

The fair values of real estate assets valued by appraisal companies and included in the headings "Investment properties", "Inventories" and "Non-current assets and disposal groups classified as held for sale", as at 31 December 2024, are as follows:

Thousand euro
Appraisal firm	Investment properties	Inventories	Non-current assets held for sale
Afes Técnicas de Tasación, S.A.	96	—	2,005
Alia Tasaciones, S.A.	8,613	4,760	47,028
Arco Valoraciones, S.A.	—	—	639
CBRE Valuation Advisory, S.A.	43,400	6,144	48,049
Col.lectiu d'Arquitectes Taxadors	—	—	260
Cushman & Wakefield	—	—	271
Eurovaloraciones, S.A.	2,793	869	13,705
Gestión de Valoraciones y Tasaciones, S.A.	14	—	207
Gloval Valuation, S.A.U.	24,027	7,811	82,094
Sociedad de Tasación, S.A.	15,532	7,868	87,974
Tasalia Sociedad de Tasación, S.A.	—	—	105
Tecnitasa Técnicos en Tasación, S.A	13,551	963	19,840
Tinsa Tasaciones Inmobiliarias, S.A.	11,560	2,792	29,405
UVE Valoraciones, S.A.	8,906	6,081	39,626
Valoraciones Mediterráneo, S.A.	26,353	6,488	73,776
Other	2,296	—	16,440
Total	157,141	43,776	461,424

The fair value of property, plant and equipment for own use does not differ significantly from its net carrying amount.

Note 7 – Cash, cash balances at central banks and other demand deposits

The composition of this asset heading on the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro
	2024	2023
By nature:
Cash	710,780	726,122
Cash balances at central banks	17,105,586	28,566,694
Other demand deposits	565,746	693,037
Total	18,382,112	29,985,853
By currency:
In euro	11,464,610	22,130,671
In foreign currency	6,917,502	7,855,182
Total	18,382,112	29,985,853

Cash balances at central banks include balances held to comply with the central bank's mandatory Minimum Required Reserves (MRR) ratio. Throughout 2024 and 2023, Banco Sabadell has complied with minimum requirements set out in applicable regulations regarding that ratio.

Note 8 – Debt securities

Debt securities reported in the consolidated balance sheets as at 31 December 2024 and 2023 are broken down below:

Thousand euro

	2024	2023
By heading:
Financial assets held for trading	879,951	142,495
Non-trading financial assets mandatorily at fair value through profit or loss	60,705	65,744
Financial assets at fair value through other comprehensive income	6,176,333	6,085,359
Financial assets at amortised cost	24,876,126	21,500,927
Total	31,993,115	27,794,525
By nature:
General governments	28,927,064	26,250,576
Credit institutions	3,488,865	2,072,205
Other sectors	499,234	424,261
Stage 3 assets	899	899
Impairment allowances	(174)	(276)
Other valuation adjustments (interest, fees and commissions, other)	(922,773)	(953,140)
Total	31,993,115	27,794,525
By currency:
In euro	26,533,521	22,699,264
In foreign currency	5,459,594	5,095,261
Total	31,993,115	27,794,525

The breakdown of debt securities classified according to their credit risk and movements of impairment allowances associated with these instruments are included, together with those of other financial assets, in Note 11.

Details of debt instruments included under the "Financial assets at fair value through other comprehensive income" heading, as at 31 December 2024 and 2023, are shown below:

Thousand euro
	2024	2023
Amortised cost	6,380,063	6,282,291
Fair value (*)	6,176,333	6,085,359
Accumulated losses recognised in equity	(267,077)	(269,215)
Accumulated capital gains recognised in equity	63,595	72,777
Value adjustments made for credit risk	(248)	(494)

(*) Includes net impairment gains or losses in the consolidated income statements for 2024 and 2023, in the amount of 236 and 852 thousand euros, of which, -5 and -192 thousand euros correspond to provisions, and 241 and 1,044 thousand euros correspond to provision reversals, respectively (see Note 34).

Details of exposures held in public debt instruments included under the "Financial assets at fair value through other comprehensive income" heading, as at 31 December 2024 and 2023, are as follows:

Thousand euro
---------------

	2024	2023
Amortised cost	5,422,183	5,470,805
Fair value	5,193,625	5,242,996
Accumulated losses recognised in equity	(265,453)	(266,112)
Accumulated capital gains recognised in equity	37,009	38,433
Value adjustments made for credit risk	(114)	(130)

Details of the "Financial assets at amortised cost" portfolio as at 31 December 2024 and 2023 are shown below:

Thousand euro

	2024	2023
General governments	21,972,126	19,950,179
Credit institutions	2,689,216	1,380,685
Other sectors	214,958	170,340
Impairment allowances	(174)	(277)
Total	24,876,126	21,500,927

Note 9 – Equity instruments

The balance of equity instruments on the consolidated balance sheets as at 31 December 2024 and 2023 breaks down as follows:

Thousand euro

	2024	2023
By heading:
Financial assets held for trading	541,005	—
Non-trading financial assets mandatorily at fair value through profit or loss	67,049	52,336
Financial assets at fair value through other comprehensive income	193,580	183,938
Total	801,634	236,274
By nature:
Resident sector	611,980	200,584
Credit institutions	11,386	9,408
Other	600,594	191,176
Non-resident sector	168,780	18,007
Other	168,780	18,007
Participations in investment vehicles	20,874	17,683
Total	801,634	236,274
By currency:
In euro	800,902	235,549
In foreign currency	732	725
Total	801,634	236,274

The equity instruments included under the heading "Financial assets held for trading" all correspond to shares of companies listed on European stock markets.

As at 31 December 2024 and 2023, there were no investments in listed equity instruments for which their quoted price was not considered as a reference of their fair value.

In addition, as at the aforesaid dates, there were no Group investments in equity instruments included in the portfolio of "Financial assets at fair value through other comprehensive income" considered to be individually significant.

Details of equity instruments included under the "Financial assets at fair value through other comprehensive income" heading are as follows:

Thousand euro
	2024	2023
Acquisition cost	239,849	243,197
Fair value	193,580	183,938
Accumulated capital losses recognised in equity at reporting date	(145,576)	(146,586)
Accumulated capital gains recognised in equity at reporting date	99,307	87,327
Transfers of gains or losses within equity during the year	3,968	(925)
Recognised dividends from investments held at the end of the year	6,356	8,413

Note 10 – Derivatives held for trading

The breakdown by type of risk of derivatives held for trading as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024				2023
	Assets	Liabilities	Assets	Liabilities
Securities risk	27,762	2,449	3,472	3,472
Interest rate risk	1,721,585	1,897,131	2,063,411	2,167,508
Foreign exchange risk	147,623	277,975	367,282	229,322
Other types of risk	121,029	121,208	129,829	129,784
Total	2,017,999	2,298,763	2,563,994	2,530,086
By currency:
In euro	997,904	1,115,267	1,417,104	1,214,618
In foreign currency	1,020,095	1,183,496	1,146,890	1,315,468
Total	2,017,999	2,298,763	2,563,994	2,530,086

The fair values of derivatives held for trading, broken down by type of derivative instrument as at 31 December 2024 and 2023, are shown below:

Thousand euro
	2024	2023
Assets
Swaps, CCIRS, Call Money Swap	1,834,535	2,138,207
Currency options	41,285	62,626
Interest rate options	33,392	55,012
Index and securities options	2,449	3,472
Currency forwards	106,338	304,656
Fixed income forwards	—	21
Total derivatives on asset side held for trading	2,017,999	2,563,994
Liabilities
Swaps, CCIRS, Call Money Swap	1,927,155	2,262,684
Currency options	41,341	62,745
Interest rate options	91,184	34,586
Index and securities options	2,449	3,472
Currency forwards	236,634	166,578
Fixed income forwards	—	21
Total derivatives on liability side held for trading	2,298,763	2,530,086

As at 31 December 2024, the Group holds embedded derivatives that have been separated from their host contracts and recognised under the heading "Financial liabilities held for trading – Derivatives" of the consolidated balance sheet in the amount of 82,443 thousand euros (18,483 thousand euros as at 31 December 2023). The host contracts of those embedded derivatives correspond to customer deposits and they have been allocated to the portfolio of financial liabilities at amortised cost.

Note 11 – Loans and advances

Central banks and Credit institutions

The breakdown of the headings "Loans and advances – Central banks" and "Loans and advances – Credit institutions" of the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro	2024	2023
By heading:
Financial assets at amortised cost	12,771,685	7,152,467
Total	12,771,685	7,152,467
By nature:
Deposits with agreed maturity	1,050,331	974,533
Reverse repos	11,247,844	5,601,564
Other	420,185	537,709
Impairment allowances	(3,264)	(3,135)
Other valuation adjustments (interest, fees and commissions, other)	56,589	41,796
Total	12,771,685	7,152,467
By currency:
In euro	11,744,913	6,084,788
In foreign currency	1,026,772	1,067,679
Total	12,771,685	7,152,467

Customers

The breakdown of the heading "Loans and advances – Customers" (General governments and Other sectors) of the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro	2024	2023
By heading:
Non-trading financial assets mandatorily at fair value through profit or loss	40,513	35,098
Financial assets at amortised cost	158,872,462	152,260,399
Total	158,912,975	152,295,497
By nature:
Bank overdrafts and other short-term borrowings	2,913,506	2,769,073
Trade credit	8,356,196	7,465,119
Finance leases	2,376,311	2,236,140
Secured loans	95,109,136	91,226,348
Reverse repos	—	17,413
Other term loans	48,198,503	46,136,443
Stage 3 assets	4,595,299	5,472,296
Impairment allowances	(2,844,248)	(3,198,969)
Other valuation adjustments (interest, fees and commissions, other) (*)	208,272	171,634
Total	158,912,975	152,295,497
By sector:
General governments	9,090,137	8,957,524
Other sectors	147,863,515	140,893,012
Stage 3 assets	4,595,299	5,472,296
Impairment allowances	(2,844,248)	(3,198,969)
Other valuation adjustments (interest, fees and commissions, other) (*)	208,272	171,634
Total	158,912,975	152,295,497
By currency:
In euro	101,220,455	97,824,215
In foreign currency	57,692,520	54,471,282
Total	158,912,975	152,295,497
By geographical area: Spain	96,625,614	93,868,665
Rest of European Union	5,613,593	5,045,047
United Kingdom	46,089,359	44,254,530
Americas	12,061,967	10,991,155
Rest of the world	1,366,690	1,335,069
Impairment allowances	(2,844,248)	(3,198,969)
Total	158,912,975	152,295,497

(*) Other valuation adjustments of financial assets classed as stage 3 amount to 41,764 thousand euros as at 31 December 2024 and 37,236 thousand euros as at 31 December 2023.

The "Loans and advances" heading on the consolidated balance sheets includes certain assets pledged in funding operations, i.e. assets pledged as collateral or guarantees with respect to certain liabilities. For further information, see Note 4.4.2 - Credit risk.

Finance leases

Certain information concerning finance leases carried out by the Group in which it acts as lessor is set out below:

Thousand euro

	2024	2023
Finance leases
Total gross investment	2,618,517	2,477,207
Impairment allowances	(94,395)	(96,444)
Interest income	93,189	71,932

As at 31 December 2024 and 2023, the reconciliation of undiscounted lease payments received against the net investment in the leases is as follows:

Thousand euro
	2024	2023
Undiscounted lease payments received	2,410,464	2,318,548
Residual value	208,053	158,659
Gross investment in the lease	2,618,517	2,477,207
Unearned finance income	(242,206)	(241,067)
Net investment in the lease	2,376,311	2,236,140

The table below shows a breakdown, by term, of the minimum undiscounted future amounts receivable by the Group during the mandatory term (assuming that no extensions or existing purchase options will be exercised) as set out in the finance lease contracts:

Thousand euro
	2024	2023
Up to 1 year	776,898	596,371
1-2 years	598,183	549,969
2-3 years	292,046	388,839
3-4 years	266,013	258,360
4-5 years	164,050	168,571
More than 5 years	313,274	356,438
Total	2,410,464	2,318,548

Past-due financial assets

The balance of customer loans past-due and pending collection not classified as stage 3, as at 31 December 2024, amounts to 232,305 thousand euros (343,472 thousand euros as at 31 December 2023). Of this total, over 73% of the balance as at 31 December 2024 (81% of the balance as at 31 December 2023) was no more than one month past-due.

Financial assets classified on the basis of their credit risk

The breakdown of financial assets, not considering valuation adjustments, classified on the basis of their credit risk as at 31 December 2024 and 2023 is as follows:

Thousand euro
Stage 1	31/12/2024	31/12/2023
Debt securities	32,915,162	28,747,042
Loans and advances	159,529,262	145,291,906
Customers	146,810,939	138,178,496
Central banks and Credit institutions	12,718,323	7,113,410
Total stage 1	192,444,425	174,038,948
By sector:
General governments	38,007,669	35,196,900
Central banks and Credit institutions	16,207,189	9,185,616
Other private sectors	138,229,567	129,656,433
Total stage 1	192,444,425	174,038,948
Stage 2
Debt securities	—	—
Loans and advances	10,142,749	11,672,436
Customers	10,142,713	11,672,041
Central banks and Credit institutions	36	396
Total stage 2	10,142,749	11,672,436
By sector:
General governments	9,533	11,200
Central banks and Credit institutions	36	396
Other private sectors	10,133,180	11,660,840
Total stage 2	10,142,749	11,672,436
Stage 3
Debt securities	899	899
Loans and advances	4,595,299	5,472,297
Customers	4,595,299	5,472,296
Central banks and Credit institutions	—	—
Total stage 3	4,596,198	5,473,196
By sector:
General governments	165	802
Central banks and Credit institutions	—	—
Other private sectors	4,596,032	5,472,394
Total stage 3	4,596,198	5,473,196
Total stages	207,183,372	191,184,580

Movements of gross values, not considering valuation adjustments, of assets subject to impairment by the Group during the years ended 31 December 2024 and 2023 were as follows:

Thousand euro
	Stage 1	Stage 2	Stage 3	Of which: purchased credit-impaired	Total
Balance as at 31 December 2022	176,143,133	13,702,021	5,460,738	123,184	195,305,892
Transfers between stages	(1,511,186)	191,372	1,319,814	—	—
Stage 1	9,046,690	(8,772,531)	(274,159)	—	—
Stage 2	(10,249,989)	10,797,954	(547,965)	—	—
Stage 3	(307,887)	(1,834,051)	2,141,938	—	—
Increases	50,604,996	1,489,365	448,084	5,389	52,542,445
Decreases	(52,266,707)	(3,814,228)	(1,387,800)	(21,945)	(57,468,735)
Transfers to write-offs	—	—	(386,109)	—	(386,109)
Adjustments for exchange differences	1,068,712	103,906	18,469	2,505	1,191,087
Balance as at 31 December 2023	174,038,948	11,672,436	5,473,196	109,133	191,184,580
Transfers between stages	(936,504)	(146,102)	1,082,606	—	—
Stage 1	5,795,926	(5,673,128)	(122,798)	—	—
Stage 2	(6,443,648)	6,985,269	(541,621)	—	—
Stage 3	(288,782)	(1,458,243)	1,747,025	—	—
Increases	62,575,346	1,723,706	670,681	6,058	64,969,733
Decreases	(44,830,051)	(3,297,424)	(2,191,200)	(18,761)	(50,318,675)
Transfers to write-offs	—	—	(456,545)	—	(456,545)
Adjustments for exchange differences	1,596,686	190,133	17,460	4,985	1,804,279
Balance as at 31 December 2024	192,444,425	10,142,749	4,596,198	101,415	207,183,372

The breakdown of assets classified as stage 3 by type of guarantee as at 31 December 2024 and 2023 is as follows:

Thousand euro

	31/12/2024	31/12/2023
Secured with a mortgage (*)	1,846,940	2,215,559
Of which: Stage 3 financial assets with guarantees covering all of the risk	1,069,940	1,429,856
Other collateral (**)	263,582	276,082
Of which: Stage 3 financial assets with guarantees covering all of the risk	88,524	114,222
Other	2,485,676	2,981,555
Total	4,596,198	5,473,196

(*) Assets secured with a mortgage with an outstanding exposure below 100% of their valuation amount.

(**) Includes the rest of assets secured with collateral.

The breakdown by geographical area of the balance of assets classified as stage 3 as at 31 December 2024 and 2023 is as follows:

Thousand euro
	31/12/2024	31/12/2023
Spain	3,541,299	4,141,559
Rest of European Union	80,157	450,006
United Kingdom	734,480	656,821
Americas	222,088	199,622
Rest of the world	18,174	25,188
Total	4,596,198	5,473,196

Movements of impaired financial assets derecognised from the asset side of the balance sheet as the likelihood of them being recovered during 2024 and 2023 was deemed to be remote were as follows:

Thousand euro
---------------

Balance as at 31 December 2022	5,847,949
Additions	552,439
Use of accumulated impairment balance	362,984
Directly recognised on income statement	23,125
Contractually payable interest	166,330
Other items	—
Disposals	(193,768)
Collections of principal in cash from counterparties	(47,446)
Collections of interest in cash from counterparties	(1,079)
Debt forgiveness	(55,234)
Expiry of statute-of-limitations period	—
Forbearance	—
Sales	(25,394)
Foreclosure of tangible assets	(694)
Other items	(63,921)
Exchange differences	13,698
Balance as at 31 December 2023	6,220,318
Additions	648,880
Use of accumulated impairment balance	427,737
Directly recognised on income statement	28,808
Contractually payable interest	191,974
Other items	361
Disposals	(411,775)
Collections of principal in cash from counterparties	(48,159)
Collections of interest in cash from counterparties	(3,011)
Debt forgiveness	(22,850)
Expiry of statute-of-limitations period	—
Forbearance	—
Sales	(294,528)
Foreclosure of tangible assets	—
Other items	(43,227)
Exchange differences	14,197
Balance as at 31 December 2024	6,471,620

Allowances

Financial asset impairment allowances, broken down by consolidated balance sheet heading, classified according to their credit risk as at 31 December 2024 and 2023 were as follows:

Thousand euro
Stage 1	2024	2023
Debt securities	174	276
Loans and advances	308,764	372,373
Central banks and Credit institutions	3,264	2,752
Customers	305,500	369,621
Total stage 1	308,938	372,649
Stage 2
Debt securities	—	—
Loans and advances	370,969	470,529
Central banks and Credit institutions	—	383
Customers	370,969	470,146
Total stage 2	370,969	470,529
Stage 3
Debt securities	—	—
Loans and advances	2,167,778	2,359,203
Central banks and Credit institutions	—	—
Customers	2,167,778	2,359,202
Total stage 3	2,167,778	2,359,203
Total stages	2,847,685	3,202,381

The movement of impairment allowances allocated by the Group to cover credit risk during 2024 and 2023 was as follows:

Thousand euro

	Individually measured		Collectively measured
	Stage 2	Stage 3	Stage 1	Stage 2	Stage 3	Total
Balance as at 31 December 2022	9,710	554,998	347,480	470,232	1,640,846	3,023,266
Movements reflected in impairment
gains/(losses) (*)	(1,840)	68,586	69,867	124,296	459,570	720,479
Increases due to origination	—	—	358,591	—	—	358,591
Changes due to credit risk variance	(2,301)	70,273	(61,521)	118,121	407,292	531,864
Changes in calculation approach	—	—	—	—	—	—
Other movements	462	(1,686)	(227,202)	6,175	52,278	(169,976)
Movements not reflected in impairment gains/(losses)	3,901	(124,279)	(48,729)	(139,818)	(244,663)	(553,588)
Transfers between stages	3,901	4,850	(48,109)	(137,732)	177,087	—
Stage 1	(530)	158	71,895	(69,050)	(2,474)	—
Stage 2	9,255	(10,993)	(111,887)	173,776	(60,152)	—
Stage 3	(4,824)	15,685	(8,117)	(242,458)	239,713	—
Utilisation of allocated provisions	—	(113,894)	(81)	(1,845)	(397,770)	(513,590)
Other movements (**)	—	(15,235)	(539)	(241)	(23,980)	(39,995)
Adjustments for exchange differences	15	778	4,032	4,033	3,366	12,224
Balance as at 31 December 2023	11,786	500,083	372,650	458,743	1,859,119	3,202,381
Movements reflected in impairment gains/(losses) (*)	(2,974)	(82,440)	(7,143)	28,819	514,160	450,422
Increases due to origination	—	—	282,758	—	—	282,758
Changes due to credit risk variance	(2,057)	(16,168)	(117,486)	63,231	515,322	442,842
Changes in calculation approach	—	—	—	—	—	—
Other movements	(917)	(66,272)	(172,415)	(34,412)	(1,162)	(275,178)
Movements not reflected in impairment gains/(losses)	(5,799)	(87,279)	(55,275)	(119,343)	(529,994)	(797,690)
Transfers between stages	(5,799)	6,590	(54,828)	(110,623)	164,660	—
Stage 1	18	347	67,065	(65,236)	(2,194)	—
Stage 2	(1,785)	(5,954)	(114,221)	194,595	(72,635)	—
Stage 3	(4,032)	12,197	(7,672)	(239,982)	239,489	—
Utilisation of allocated provisions	—	(93,869)	(325)	(8,974)	(690,581)	(793,749)
Other movements (**)	—	—	(122)	254	(4,073)	(3,941)
Adjustments for exchange differences	(4)	(1,506)	(1,292)	(263)	(4,363)	(7,428)
Balance as at 31 December 2024	3,009	328,858	308,940	367,956	1,838,922	2,847,685

(*) This figure includes the amortisation/depreciation through profit or loss of impaired financial assets derecognised from the asset side of the balance sheet and the recovery of write-offs which have been recognised with a balancing entry under the heading "Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains" (see Note 34).

(**) Corresponds to credit loss allowances transferred to non-current assets held for sale and investment properties.

The breakdown by geographical area of the balance of impairment allowances as at 31 December 2024 and 2023 is as follows:

Thousand euro
	2024	2023
Spain	2,380,069	2,566,179
Rest of European Union	65,472	171,176
United Kingdom	258,361	283,907
Americas	131,775	167,230
Rest of the world	12,008	13,889
Total	2,847,685	3,202,381

Note 12 – Derivatives - hedge accounting

Hedging management

The main hedges arranged by the Group are described below:

Interest rate risk hedge

Based on the balance sheet position and the market situation and outlook, interest rate risk mitigation strategies are proposed and agreed upon to adapt that position to the one desired by the Group. With this aim in mind, the Group establishes interest rate risk hedging strategies for positions that are not included in the trading book and, to that end, derivative instruments are used, whether fair value or cash flow hedging instruments, and a distinction is made between them depending on the items hedged:

• Macro-hedges: hedges intended to mitigate the risk of balance sheet components.
• Micro-hedges: hedges intended to mitigate the risk of a particular asset or liability.

When a transaction is designated as a hedging operation, it is classified as such from the inception of the transaction or of the instruments included in the hedge, and a document is prepared which covers the hedging strategy, defining it in management and accounting terms and setting out its governance arrangements. The aforesaid document clearly identifies the hedged item(s) and the hedging instrument(s), the risk that it seeks to hedge and the criteria or methodologies followed by the Group to evaluate its effectiveness.

The Group operates with the following types of hedges intended to mitigate structural interest rate risk:

– Fair value hedges: hedges against the exposure to changes in the fair value of assets and liabilities recognised on the balance sheet, or against the analogous exposure of a specific selection of such assets and liabilities, that can be attributed to interest rate risk. These are used to keep a stable economic value of equity.

The main types of balance sheet items hedged are:

• Fixed-rate loans included in the lending portfolio.
• Debt securities included in the portfolio of "Financial assets at fair value through other comprehensive income" and the portfolio of "Financial assets at amortised cost".
• Fixed-rate liabilities, including fixed-term deposits and the Institution's funding operations in capital markets.

Banco Sabadell generally uses macro-hedging for balance sheet items, both assets and liabilities, while TSB uses macro-hedging for fixed-rate loans or deposits and micro-hedging for debt securities or the Institution's funding operations in capital markets, for which derivative contracts are arranged, typically for a nominal amount identical to that of the hedged item and with the same financial characteristics.

If the hedge relates to assets, the Group enters into a fixed-for-floating swap, whereas if the hedge relates to liabilities, it enters into a floating-to-fixed interest rate swap. These derivatives can be traded in cash or as forwards. The hedged risk is the interest rate risk deriving from a potential change in the risk-free interest rate that gives rise to changes in the value of the hedged balance sheet items. As such, the hedge will not cover any risk inherent in the hedged items other than the risk of a change in the risk-free interest rate.

In order to assess the effectiveness of the hedge from the beginning, a backtesting exercise is carried out which compares the accumulated monthly variance in the fair value of the hedged item against the accumulated monthly variance in the fair value of the hedging derivative. Hedge effectiveness is also assessed on a forward-looking basis, verifying that future changes in the fair value of the hedged balance sheet items are offset by future changes in the fair value of the derivative in the event of any changes in the market interest rate curve.

– Cash flows: hedge of the exposure to variability in cash flows that is attributable to a particular risk associated with a recognised asset or liability, or a highly probable forecast transaction that could affect profit or loss. They are used to reduce net interest income volatility.

The main type of balance sheet items that are hedged correspond to floating-rate mortgage loans indexed to the mortgage Euribor and the 3-month Euribor.

Banco Sabadell generally uses macro-hedging for balance sheet items, both assets and liabilities, while TSB also uses micro-hedging for floating-rate issues of its own-name securities, for which derivative contracts are arranged, typically for a nominal amount identical to that of the hedged item and with the same financial characteristics.

If the hedge relates to assets, the Group enters into a floating-to-fixed interest rate swap, whereas if the hedge relates to liabilities, it enters into a fixed-for-floating swap. These derivatives can be traded in cash or as forwards. The hedged risk is the interest rate risk deriving from a potential change in the benchmark interest rate that affects the future interest accrued on hedged balance sheet items. The credit risk spread or credit risk premium which, together with the benchmark index, makes up the contractual interest rate applicable to the hedged balance sheet items is expressly excluded from the hedge.

In order to assess the effectiveness of the hedge from the beginning, a backtesting exercise is carried out which compares the accumulated variance in the fair value of the hedged item against the accumulated variance in the fair value of the hedging derivative. Hedge effectiveness is also assessed on a forward-looking basis, verifying that the expected cash flows of the hedged items are still highly probable.

Possible causes of partial or total ineffectiveness include changes in the sufficiency of the portfolio of hedged balance sheet items or differences in their contractual characteristics in relation to hedging derivatives.

Every month the Group calculates the interest rate risk metrics and establishes hedging strategies in accordance with the established Risk Appetite Framework. Hedges are therefore managed, establishing hedges or discontinuing them, as required, on the basis of the evolution of the balance sheet items described previously within the management and control framework defined by the Group through its policies and procedures.

Hedges of net investment in foreign operations

The positions of subsidiaries and foreign branches implicitly entail exposure to foreign exchange risk, which is managed by creating hedges through the use of forward contracts and options.

The maturities of these instruments are periodically renewed on the basis of prudential and forward-looking criteria.

Hedging disclosures for the year 2024

The nominal values and the fair values of hedging instruments as at 31 December 2024 and 2023, broken down by risk category and type of hedge, are as follows:

Thousand euro
---------------

	2024			2023
	Nominal	Assets	Liabilities	Nominal	Assets	Liabilities
Microhedges:
Fair value hedges	9,519,561	1,005,242	157,192	11,305,664	812,117	246,705
Interest rate risk	4,371,722	947,008	33,117	3,131,379	764,450	27,988
Of liability-side transactions (A)	1,726,000	1,460	32,701	686,434	912	23,990
Of asset-side transactions (B)	2,645,722	945,548	416	2,444,945	763,538	3,998
Equity risk	5,147,839	58,234	124,075	8,174,285	47,667	218,717
Of liability-side transactions (A)	5,147,839	58,234	124,075	8,174,285	47,667	218,717
Cash flow hedges	4,987,829	75,615	25,990	2,749,498	104,510	24,886
Foreign exchange risk	500,000	2,286	—	—	—	—
Of liability-side transactions (A)	500,000	2,286	—	—	—	—
Interest rate risk	2,566,326	39,651	13,280	1,993,010	99,229	4,091
Of future transactions (C)	870,505	3,638	13,230	—	—	—
Of liability-side transactions (A)	294,399	33,692	—	875,071	97,768	4,088
Of securitisation transactions (D)	1,401,422	2,321	50	1,117,939	1,461	3
Equity risk	3,461	23	11	31,380	258	9
Of liability-side transactions (E)	3,461	23	11	31,380	258	9
Other risks	1,918,042	33,655	12,699	725,108	5,023	20,786
Of inflation-linked bonds (F)	1,917,960	33,655	12,699	725,000	5,023	20,786
Of future transactions (C)	82	—	—	108	—	—
Hedge of net investment in foreign
operations	1,645,617	2,451	23,112	1,343,425	16,867	4,910
Foreign exchange risk (G)	1,645,617	2,451	23,112	1,343,425	16,867	4,910
Macrohedges:
Fair value hedges	63,622,718	1,289,070	585,736	48,904,105	1,484,180	864,880
Interest rate risk	63,622,718	1,289,070	585,736	48,904,105	1,484,180	864,880
Of liability-side transactions (H)	27,160,377	176,702	310,050	19,619,340	138,287	581,242
Of asset-side transactions (I)	36,462,341	1,112,368	275,686	29,284,765	1,345,893	283,638
Cash flow hedges	10,375,000	22,524	11,969	9,800,000	6,924	30,576
Interest rate risk	10,375,000	22,524	11,969	9,800,000	6,924	30,576
Of liability-side transactions	—	—	—	—	—	—
Of asset-side transactions (J)	10,375,000	22,524	11,969	9,800,000	6,924	30,576
Total	90,150,725	2,394,902	803,999	74,102,692	2,424,598	1,171,957
By currency:
In euro	49,746,004	1,393,299	632,616	40,869,593	872,897	831,600
In foreign currency	40,404,721	1,001,603	171,383	33,233,099	1,551,701	340,357
Total	90,150,725	2,394,902	803,999	74,102,692	2,424,598	1,171,957

The types of hedges according to their composition that are identified in the table are as follows:

• A. Micro-hedges of interest rate risk on the Institution's funding operations in capital markets and transactions involving structured term deposits opened by customers, recognised under the heading "Financial liabilities at amortised cost".
• B. Micro-hedges of debt securities classified under the headings "Financial assets at fair value through other comprehensive income" and "Financial assets at amortised cost".
• C. Micro-hedges of future transactions. The Institution designates as a hedging item those derivative contracts that will be settled at their gross amount through the transfer of the underlying asset (generally fixed-income securities) according to the contract price.
• D. Micro-hedging operations carried out by the Group's securitisation funds.
• E. Micro-hedges of transactions involving structured term deposits arranged with customers and which are currently being sold.
• F. Micro-hedges of interest rates on inflation-linked bonds, recognised under the heading "Financial assets at amortised cost". The Group has arranged financial swaps to hedge future changes in cash flows that will be settled by inflation-linked bonds.
• G. Hedges against foreign exchange risk on permanent investments currently cover 545 million pounds sterling and 8,853 million Mexican pesos corresponding to interests held in Group entities (393 million pounds sterling and 8,553 million Mexican pesos as at 31 December 2023) and 600 million US dollars corresponding to interests held in foreign branches (480 million US dollars as at 31 December 2023). All of these hedges are arranged through currency forwards.
• H. Macro-hedges of the Institution's funding operations in capital markets and transactions involving term deposits and demand deposits arranged by customers recognised under the heading "Financial liabilities at amortised cost".
• I. Macro-hedges of debt securities classified under the headings "Financial assets at fair value through other comprehensive income" and "Financial assets at amortised cost", and of fixed-rate mortgage loans granted to customers recognised under the heading "Financial assets at amortised cost".
• J. Macro-hedges of floating-rate mortgage loans granted to customers recognised under the heading "Financial assets at amortised cost". As at 31 December 2024, the average rate of financial interest rate swaps used for these hedges was 3.30%, for hedges of loans indexed to the 12-month Euribor (3.87% as at 31 December 2023), and 2.22% for hedges of loans indexed to the 3-month Euribor. As at 31 December 2023, there were no hedges of loans indexed to the 3-month Euribor in force.

The maturity profiles of the hedging instruments used by the Group as at 31 December 2024 and 2023 are shown below:

Thousand euro
				2024
	Nominal
	Up to 1 month	1 to 3 months	3 to 12 months	1 to 5 years	More than 5 years	Total
Foreign exchange risk	752,075	874,050	19,492	500,000	—	2,145,617
Interest rate risk	3,017,865	4,279,802	19,997,332	34,860,179	18,780,588	80,935,766
Equity risk	666,977	668,821	1,915,814	1,896,227	3,461	5,151,300
Other risks	—	—	—	525,000	1,393,042	1,918,042
Total	4,436,917	5,822,673	21,932,638	37,781,406	20,177,091	90,150,725

Thousand euro

	2023
	Nominal
	Up to 1 month	1 to 3 months	3 to 12 months	1 to 5 years	More than 5 years	Total
Foreign exchange risk	675,264	645,726	22,435	—	—	1,343,425
Interest rate risk	586,848	3,898,997	14,262,726	28,693,797	16,386,126	63,828,494
Equity risk	49,073	229,858	2,809,004	5,106,350	11,380	8,205,665
Other risks	—	—	—	525,000	200,108	725,108
Total	1,311,185	4,774,581	17,094,165	34,325,147	16,597,614	74,102,692

In 2024 and 2023 there were no reclassifications from equity to the consolidated income statement due to cash flow hedges and hedges of net investments in foreign operations for transactions that were ultimately not executed.

The following table shows the accounting information of items covered by the fair value micro-hedges arranged by the Group:

Thousand euro
		2024
		Carrying amount of hedged item		Accumulated fair value adjustments in the hedged item	Accumulated amount of adjustments in hedged items for which hedge accounting no longer applies
	Assets	Liabilities	Assets	Liabilities
Microhedges: Fair value hedges Foreign exchange risk	—	—	—	—	—
Interest rate risk	2,287,159	554,377	(1,050,010)	(8,717)	(678)
Equity risk	—	3,432,140	—	3,170	—
Total	2,287,159	3,986,517	(1,050,010)	(5,547)	(678)
Thousand euro
		2023 Accumulated fair value Carrying amount of adjustments in the hedged hedged item item			Accumulated amount of adjustments in hedged items for which hedge accounting no longer applies
	Assets	Liabilities	Assets	Liabilities
Microhedges: Fair value hedges
Foreign exchange risk Interest rate risk	— 2,277,611	— 344,500	— (834,132)	— (26,400)	— (620)
Equity risk	—	4,052,256	—	(17,108)	—

In terms of fair value macro-hedges, the carrying amount of the hedged items recognised in assets and liabilities as at 31 December 2024 amounts to 88,073,619 thousand euros and 46,480,320 thousand euros, respectively (66,138,396 thousand euros and 44,657,503 thousand euros as at 31 December 2023, respectively). Similarly, fair value adjustments of the hedged asset and liability items in the portfolio hedge of interest rate risk amount to -412,346 thousand euros and -227,209 thousand euros as at 31 December 2024, respectively (-567,608 thousand euros and -422,347 thousand euros as at 31 December 2023).

Total 2,277,611 4,396,756 (834,132) (43,508) (620)

In relation to fair value hedges, the losses and gains recognised in 2024 and 2023 arising from both hedging instruments and hedged items are detailed hereafter:

Thousand euro	2024		2023
	Hedging instruments	Hedged items	Hedging instruments	Hedged items
Micro-hedges	192,578	(193,060)	(331,922)	64,566
Fixed-rate assets	142,844	(141,757)	(352,997)	85,530
Capital markets and fixed-rate liabilities	10,790	(12,337)	76,055	(75,866)
Assets denominated in foreign currency	38,944	(38,966)	(54,980)	54,902
Macro-hedges	(40,465)	7,332	(289,542)	575,855
Capital markets and fixed-rate liabilities	151,019	(197,170)	535,919	(548,298)
Fixed-rate assets	(191,484)	204,502	(825,461)	1,124,153
Total	152,113	(185,728)	(621,464)	640,421

In cash flow hedges, the amounts recognised in the consolidated statement of equity during the year and the amounts derecognised from consolidated equity and included in profit or loss during the year are indicated in the consolidated statement of total changes in equity.

The ineffectiveness of cash flow hedges recognised in profit or loss for 2024 amounted to losses of 229 thousand euros (losses of 6,763 thousand euros in 2023).

As at 31 December 2024, the Group holds embedded derivatives that have been separated from their host contracts and recognised under the headings "Derivatives – Hedge accounting" on the asset side and on the liabilities side of the consolidated balance sheet in the amount of 19,282 thousand euros and 101,642 thousand euros, respectively (18,322 thousand euros and 173,828 thousand euros, respectively, as at 31 December 2023). The host contracts of those embedded derivatives correspond to customer deposits and debt securities issued and they have been allocated to the portfolio of financial liabilities at amortised cost.

Note 13 – Non-current assets and disposal groups classified as held for sale

The composition of this heading on the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024	2023
Assets	930,919	991,045
Loans and advances	3,839	6,328
Customers	3,839	6,328
Equity instruments	159,748	159,748
Real estate exposure	636,146	708,051
Tangible assets for own use	48,096	49,432
Foreclosed assets	588,050	658,619
Other tangible assets	114,237	103,864
Rest of other assets	16,949	13,054
Impairment allowances	(212,587)	(220,167)
Non-current assets and disposal groups classified as held for sale	718,332	770,878
Liabilities	30,093	13,347
Financial liabilities at amortised cost	26,416	12,682
Tax liabilities	3,676	665
Other	1	—
Liabilities included in disposal groups classified as held for sale	30,093	13,347

Tangible assets for own use relate mainly to commercial premises.

Regarding real estate assets obtained through foreclosures, 95.37% of the balance corresponds to residential properties, 4.12% to industrial properties and 0.51% to agricultural properties.

The average term during which assets remained within the category of "Non-current assets and assets and liabilities included in disposal groups classified as held for sale – Foreclosed assets" was 71 months in 2024 (62 months in 2023). The policies on the sale or disposal by other means of these assets are described in Note 4.4.2.1.

The percentage of foreclosed assets sold with financing granted to the buyer in 2024 was 3.3% (3.3% in 2023). On the date of sale, these properties had a gross asset value of 3.8 million euros in 2024 (4.6 million euros in 2023).

This heading includes the amounts of assets and liabilities linked to the strategic agreement signed with Nexi S.p.A. in relation to the merchant acquiring business. These assets and liabilities have been reclassified as "Non-current assets and disposal groups classified as held for sale" and will remain so until the transaction is fully closed (see Note 2).

This heading also includes the 20% stake held in the associate company Promontoria Challenger I, S.A., an entity controlled by Cerberus, to which the Group transferred a large portion of its real estate exposure in 2019.

Movements in "Non-current assets and disposal groups classified as held for sale" during 2024 and 2023 were as follows:

Thousand euro

	Note	Non-current assets held for sale
Cost:
Balances as at 31 December 2022		951,792
Additions		171,503
Disposals		(302,164)
Transfer of credit losses (*)		(11,620)
Other transfers/reclassifications		181,534
Balances as at 31 December 2023		991,045
Additions		48,362
Disposals		(125,140)
Transfer of credit losses (*)		(4,692)
Other transfers/reclassifications		21,344
Balances as at 31 December 2024		930,919
Impairment allowances:
Balances as at 31 December 2022		213,479
Impairment through profit or loss	37	56,629
Reversal of impairment through profit or loss	37	(22,317)
Utilisations		(56,997)
Other transfers/reclassifications		29,373
Balances as at 31 December 2023		220,167
Impairment through profit or loss	37	59,251
Reversal of impairment through profit or loss	37	(28,271)
Utilisations		(38,793)
Other transfers/reclassifications		233
Balances as at 31 December 2024		212,587
Net balances as at 31 December 2023		770,878
Net balances as at 31 December 2024		718,332

(*) Allowance arising from provisions allocated to cover credit risk.

Details of the net carrying amount of transfers shown in the table above are as follows:

Thousand euro
	Note	2024	2023
Loans and advances		(2,487)	5,667
Tangible assets	15	19,772	136,614
Intangible assets	16	—	8,499
Other		3,826	1,381
Total		21,111	152,161

Note 14 – Investments in joint ventures and associates

Movements in this heading of the consolidated balance sheets during the financial years 2024 and 2023 were as follows:

Thousand euro

Balance as at 31 December 2022	376,940
Profit/(loss) for the year	122,807
Acquisition or capital increase (*)	1,356
Dividends (*)	(28,669)
Impairment, allowances, translation differences and other	(9,678)
Balance as at 31 December 2023	462,756
Profit/(loss) for the year	159,634
Acquisition or capital increase (*)	1,692
Dividends (*)	(102,196)
Impairment, allowances, translation differences and other	2,676
Balance as at 31 December 2024	524,562

(*) See consolidated cash flow statement.

The main investee companies included in the accounts for the first time and those no longer included in 2024 and 2023 are indicated in Schedule I.

As at 31 December 2024 and 2023, no support agreements or other type of significant contractual commitment had been provided by the Bank or its subsidiaries to associates.

The reconciliation between the Group's investment in investees and the balance recorded under the heading "Investments in joint ventures and associates" is as follows:

Total	524,562	462,756
Value adjustments and other	3,260	4,212
Contributions due to retained earnings	304,004	239,000
Group investment in associates (Schedule I)	217,298	219,544
	2024	2023
Thousand euro

Set out below are the most relevant financial data of the associate BanSabadell Vida, S.A. as at 31 December 2024 and 2023, through which the Bank extends its customer offer via the distribution of insurance products through its branch network:

Thousand euro

	BanSabadell Vida (*)
	2024	2023
Total assets	9,722,196	9,556,627
Of which: financial investments	8,763,140	8,510,475
Total liabilities	9,027,272	8,837,988
Of which: technical provisions	9,074,430	9,037,426
Profit/(loss) of Vida's technical account	141,488	136,313
Of which: premiums earned during the year	1,801,982	2,511,257
Of which: claims paid during the year	(1,564,928)	(1,963,876)
Of which: technical financial yield	224,722	211,763

(*) Figures taken from BanSabadell Vida accounts without taking into consideration consolidation adjustments or the Group's percentage holding.

As at 31 December 2024 and 2023, the carrying amount of the investment in BanSabadell Vida, S.A. amounted to 251,428 thousand euros and 210,941 thousand euros, respectively. Furthermore, as at these dates, the aggregate carrying amount of investments in associates not considered individually significant was 273,134 thousand euros and 251,815 thousand euros, respectively.

Note 15 – Tangible assets

The composition of this heading on the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024				2023
	Cost	Depreciation	Impairment	Net amount	Cost	Depreciation	Impairment	Net amount
Property, plant and equipment 3,980,806		(1,985,566)		(74,753) 1,920,487	3,930,317	(1,818,023)		(45,188) 2,067,106
For own use:	3,965,427	(1,973,804)		(74,753) 1,916,870	3,907,505	(1,804,259)		(45,188) 2,058,058
Computer equipment and related facilities	634,501	(468,849)	—	165,652	587,570	(415,704)	—	171,866
Furniture, vehicles and other facilities	926,915	(607,969)	(30,537)	288,409	935,347	(590,146)	—	345,201
Buildings	2,316,395	(884,097)		(44,216) 1,388,082	2,329,727	(789,168)		(45,188) 1,495,371
Work in progress	47,235	—	—	47,235	19,011	—	—	19,011
Other	40,381	(12,889)	—	27,492	35,850	(9,241)	—	26,609
Leased out under operating
leases	15,379	(11,762)	—	3,617	22,812	(13,764)	—	9,048
Investment properties	272,910	(54,803)	(60,966)	157,141	369,376	(62,302)	(77,476)	229,598
Buildings	272,910	(54,803)	(60,966)	157,141	369,376	(62,302)	(77,476)	229,598
Rural property, plots and sites	—	—	—	—	—	—	—	—
Total	4,253,716	(2,040,369)		(135,719) 2,077,628	4,299,693	(1,880,325)		(122,664) 2,296,704

Movements in the balance under this heading during 2024 and 2023 were as follows:

Thousand euro
	Own use - Buildings, work in progress and other	Own use - Computer equipment, furniture and related facilities	Investment properties	Leased out under operating leases	Total
Note Cost:
Balances as at 31 December 2022	2,377,363	1,683,747	438,400	20,949	4,520,456
Additions	113,393	121,534	62	1,431	236,420
Disposals	(86,630)	(61,866)	(61,062)	—	(209,558)
Transfers	(29,137)	(223,188)	(8,024)	—	(260,349)
Exchange rate	9,599	2,693	—	432	12,724
Balances as at 31 December 2023	2,384,588	1,522,920	369,376	22,812	4,299,693
Additions	117,755	66,324	71	—	184,150
Disposals	(102,506)	(31,182)	(91,257)	(8,531)	(233,476)
Transfers	(17,146)	1,205	(5,280)	—	(21,221)
Exchange rate	21,320	2,151	—	1,098	24,569
Balances as at 31 December 2024	2,404,011	1,561,418	272,910	15,379	4,253,715
Accumulated depreciation:
Balances as at 31 December 2022	686,786	1,056,369	54,423	11,605	1,809,183
Additions	137,953	113,267	9,366	1,916	262,502
Disposals	(22,813)	(42,028)	(5,411)	—	(70,252)
Transfers	(7,075)	(123,090)	3,924	—	(126,241)
Exchange rate	3,558	1,332	—	243	5,133
Balances as at 31 December 2023	798,409	1,005,850	62,302	13,764	1,880,325
Additions	145,760	101,305	6,063	—	253,128
Disposals	(55,392)	(32,047)	(13,332)	(2,611)	(103,382)
Transfers	(1,279)	(121)	(230)	—	(1,630)
Exchange rate	9,489	1,830	—	609	11,928
	896,987	1,076,817	54,803	11,762	2,040,369
Balances as at 31 December 2024
Impairment losses:
Balances as at 31 December 2022	45,249	—	84,234	—	129,482
Impairment through profit or loss 35	3,319	—	17,053	—	20,372

Net balances as at 31 December 2024		1,462,808	454,064	157,141	3,617	2,077,628
Net balances as at 31 December 2023		1,540,991	517,070	229,597	9,048	2,296,704
Balances as at 31 December 2024		44,216	30,537	60,966	—	135,719
Transfers		(1)	—	(51)	—	(52)
Utilisations		(7,097)	—	(17,616)	—	(24,713)
Reversal of impairment through profit or loss	35	(268)	—	(2,553)	—	(2,821)
Impairment through profit or loss	35	6,393	30,537	3,709	—	40,639
Balances as at 31 December 2023		45,189	—	77,477	—	122,665
Transfers		(1,990)	—	3,918	—	1,928
Utilisations		—	—	(20,271)	—	(20,271)
Reversal of impairment through profit or loss	35	(1,389)	—	(7,457)	—	(8,846)
Impairment through profit or loss	35	3,319	—	17,053	—	20,372

The net carrying amount of "Transfers" in 2024 was -19,539 thousand euros (-136,035 thousand euros in 2023), of which 233 thousand euros (579 thousand euros in 2023) correspond to reclassifications from the heading "Inventories" (see Note 17) and -19,772 thousand euros (-136,614 thousand euros in 2023), to reclassifications of assets from or to the heading "Non-current assets and disposal groups classified as held for sale" (see Note 13).

Specific information relating to tangible assets as at 31 December 2024 and 2023 is shown here below:

2024	2023
675,605	572,004
300,760	302,192

Lease contracts in which the Group acts as lessee

As at 31 December 2024, the cost of property, plant and equipment for own use includes right-of-use assets corresponding to leased tangible assets in which the Group acts as lessee, in the amount of 1,394,121 thousand euros, which have accumulated depreciation of 575,576 thousand euros and are impaired in the amount of 39,201 thousand euros as at the aforesaid date (1,359,188 thousand euros as at 31 December 2023, which had accumulated depreciation of 486,883 thousand euros and were impaired in the amount of 40,026 thousand euros as at that date).

The expense recognised in the consolidated income statement for 2024 for the depreciation and impairment of right-of-use assets corresponding to leased tangible assets in which the Group acts as lessee amounted to 104,569 thousand euros and 1,496 thousand euros, respectively (94,454 thousand euros and 1,369 thousand euros, respectively, in 2023).

Information is set out below concerning the lease contracts in which the Group acts as lessee:

	2024	2023
Interest expense on lease liabilities	(18,833)	(16,910)
Expense related to short-term low-value leases (*)	(3,641)	(11,793)
Total lease payments in cash (**)	114,443	106,577

(*) Recognised in the "Administrative expenses" heading, in the item "Property, plant and equipment" (see Note 33).

(**) Payments of the principal and interest components of the lease liability are recognised as cash flows from financing activities in the Group's consolidated cash flow statement.

The future cash outflows to which the Group may potentially be exposed as lessee and which are not included under lease liabilities are not significant.

Minimum future payments over the non-cancellable period for lease contracts in effect as at 31 December 2024 and 2023 are indicated below:

Thousand euro
	2024	2023
Undiscounted lease payments receivable
Up to 1 month	8,026	8,205
1 to 3 months	19,461	20,352
3 to 12 months	82,413	82,703
1 to 5 years	391,507	387,761
More than 5 years	513,147	581,964

Sale and leaseback transactions

Between 2009 and 2012, the Group completed transactions for the sale of properties and simultaneously entered into a lease contract, for the same properties, with the buyers (maintenance, insurance and taxes to be borne by the Bank). The main characteristics of the most significant lease contracts in effect as at the end of 2024 are as follows:

Operating lease contracts	No. properties	No. contracts with purchase option	No. contracts without purchase option	Mandatory term
2009	57	20	37	10 to 20 years
2010	379	378	1	10 to 25 years
2011 (acquisition Banco Guipuzcoano)	33	25	8	8 to 20 years
2012 (acquisition Banco CAM)	12	12	—	10 to 25 years
2012	4	4	—	15 years

Specific information in connection with this set of lease contracts as at 31 December 2024 and 2023 is given below:

Thousand euro
	2024	2023
Undiscounted lease payments receivable
Up to 1 month	4,748	4,733
1 to 3 months	9,025	9,157
3 to 12 months	41,893	41,916
1 to 5 years	222,441	221,302
More than 5 years	346,911	405,052

In 2024 and 2023, no significant profit or loss was recorded for sale and leaseback transactions.

Contracts in which the Group acts as lessor

The lease contracts entered into by the Group in which it acts as lessor are mainly operating leases.

The Group implements strategies to reduce risks related to the rights held over the underlying assets. For example, the lease contracts include clauses which stipulate a minimum non-cancellable lease term, a deposit which the lessor may retain as compensation if the asset sustains excessive wear during the lease term, and additional guarantees or sureties to limit losses in the event of non-payment.

As regards the investment properties item, the rental income from these investment properties and the direct costs associated with the investment properties that produced rental income during 2024 amount to 20,137 thousand euros and 3,528 thousand euros, respectively (22,850 thousand euros and 9,908 thousand euros in 2023). Direct costs associated with investment properties that did not produce rental income were not significant in the context of the consolidated annual financial statements.

Note 16 – Intangible assets

The composition of this heading on the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

	2024	2023
Goodwill:	1,018,311	1,018,311
Banco Urquijo	473,837	473,837
Grupo Banco Guipuzcoano	285,345	285,345
From acquisition of Banco BMN Penedés assets	245,364	245,364
Other	13,765	13,765
Other intangible assets:	1,531,147	1,464,763
With a finite useful life:	1,531,147	1,464,763
Private Banking Business, Miami	1,276	1,825
TSB brand	13,107	17,509
Computer software	1,515,821	1,444,408
Other	943	1,021
Total	2,549,458	2,483,074

Goodwill

As set forth in the regulatory framework of reference, Banco Sabadell carried out an analysis in 2024 to evaluate the existence of any potential impairment of its goodwill.

The main transactions that generated goodwill were the acquisition of Banco Urquijo in 2006, of Banco Guipuzcoano in 2010 and of certain assets of BMN-Penedès in 2013.

Banco Sabadell Group monitors the Group's total goodwill across the ensemble of Cash-Generating Units (CGUs) that make up the Banking Business Spain operating segment. In addition, the Group considers that the United Kingdom operating segment is a CGU.

The value in use of the Banking Business Spain operating segment is used to determine its recoverable amount. The valuation method used in this analysis was that of discounting future distributable net profit associated with the activity carried out by the Banking Business Spain operating segment until 2029, plus an estimated terminal value.

The projections used to determine the recoverable amount are those set out in the financial projections approved by the Board of Directors. Those projections are based on sound and well-founded assumptions, which represent Management's best estimates of overall upcoming economic conditions. To determine the key variables (basically net interest income, fees and commissions, expenses, cost of risk and solvency levels) that underpin the financial projections, Management has used microeconomic variables, such as the existing balance sheet structure, market positioning and strategic decisions made, as well as macroeconomic variables, such as the expected evolution of GDP and the forecast evolution of interest rates and unemployment. The macroeconomic variables used for the baseline macroeconomic scenario, described in Note 4.4.2.5, were estimated by the Group's Research Service.

The approach used to determine the values of the assumptions is based both on the projections and on past experience. Those values are compared against external information sources, where available.

In 2024, to calculate the terminal value, Spain's real GDP in 2029 was taken as reference, using a growth rate in perpetuity of 2.1% (1.8% in 2023), which does not exceed the long-term average growth rate of the market in which the operating segment is active. The discount rate used was 9.8% (11.2% in 2023), determined using the Capital Asset Pricing Model (CAPM); it therefore comprises a risk-free rate (10-year Spanish bond) plus a risk premium which reflects the inherent risk of the operating segment being evaluated.

The recoverable amount obtained is higher than the carrying amount; therefore, there is no evidence of impairment. The individual recoverable amount for each CGU as at the end of 2024 and 2023, before allocating goodwill to the CGUs as a group, was above its carrying amount; therefore, the Group did not recognise any impairment at the CGU level during the aforesaid years.

In addition, the Group carried out a sensitivity analysis, making reasonable adjustments to the main assumptions used to calculate the recoverable amount.

This test consisted of adjusting, individually, the following assumptions:

• Discount rate +/- 0.5%.
• Growth rate in perpetuity +/- 0.5%.
• Minimum capital requirement +/-0.75%.
• NIM/ATAs in perpetuity +/- 5bps.
• Cost of risk in perpetuity +/- 10bps.

The sensitivity analysis does not alter the conclusions drawn from the impairment test. In all scenarios defined in that analysis, the recoverable amount obtained is greater than the carrying amount.

In accordance with the specifications of the restated text of the Corporation Tax Law, the goodwill generated is not tax-deductible.

Other intangible assets

TSB brand

The intangible assets associated with the acquisition of TSB correspond to the value of the exclusive right of use of the TSB brand, initially estimated at 73,328 thousand euros. The value attributable to this asset was determined through the replacement cost method, consisting of establishing the cost of rebuilding or acquiring an exact replica of the asset in question. This asset is amortised over a period of 12 years. The assessment of the recoverable amount of the TSB CGU included an implicit valuation of the brand, concluding that there was no impairment.

Computer software

Computer software costs include mainly the capitalised costs of developing the Group's computer software and the cost of purchasing software licences.

R&D expenditure in 2024 and 2023 was not significant.

Movements

Movements in goodwill in 2024 and 2023 were as follows:

Thousand euro
	Goodwill	Impairment	Total
Balance as at 31 December 2022	1,026,810	—	1,026,810
Additions	—	—	—
Disposals	—	—	—
Transfers	(8,499)	—	(8,499)
Balance as at 31 December 2023	1,018,311	—	1,018,311
Additions	—	—	—
Disposals	—	—	—
Transfers	—	—	—
Balance as at 31 December 2024	1,018,311	—	1,018,311

Movements in other intangible assets in 2024 and 2023 were as follows:

Thousand euro
		Cost		Amortisation		Impairment			Total
	Developed internally	Other	Total	Developed internally	Other	Total	Developed internally	Other	Total
Balance as at 31 December 2022	2,573,805	774,552	3,348,357	(1,266,318) (624,687)		(1,891,005)	—	—	—	1,457,352
Additions	235,489	60,596	296,085	(221,636)	(34,827)	(256,463)	—	—	—	39,622
Disposals	(103,691)	(5,612)	(109,303)	60,722	2,464	63,186	—	—	—	(46,117)
Other	438	(2,759)	(2,321)	(1,529)	3,536	2,007	—	—	—	(314)
Exchange differences	12,214	7,572	19,786	848	(6,414)	(5,566)	—	—	—	14,220
Balance as at 31 December 2023	2,718,255	834,349	3,552,604	(1,427,913) (659,928)		(2,087,841)	—	—	—	1,464,763
Additions	296,861	49,332	346,193	(217,887)	(30,025)	(247,912)	—	—	—	98,281
Disposals	(39,722)	(335)	(40,057)	18,053	172	18,225	—	—	—	(21,832)
Other	—	3,941	3,941	—	(3,975)	(3,975)	—	—	—	(34)
Exchange differences	(8,612)	17,959	9,347	(2,914)	(16,464)	(19,378)	—	—	—	(10,031)
Balance as at 31 December 2024	2,966,782	905,246	3,872,028	(1,630,661) (710,220)		(2,340,881)	—	—	—	1,531,147

The gross value of other intangible assets that were in use and had been fully amortised as at 31 December 2024 and 2023 amounted to 1,408,002 thousand euros and 1,367,070 thousand euros, respectively.

In 2024, the Group recognised a loss of 21,292 thousand euros (50,750 thousand euros in 2023) under the heading "Gains or (-) losses on derecognition of non-financial assets, net" of the consolidated income statement, corresponding to the impact of the withdrawal of certain IT applications due to obsolescence.

Note 17 – Other assets and liabilities

The "Other assets" heading on the consolidated balance sheets as at 31 December 2024 and 2023 breaks down as follows:

Thousand euro

	Note	2024	2023
Insurance contracts linked to pensions	22	80,888	80,693
Inventories		43,776	62,344
Rest of other assets		300,066	293,086
Total		424,730	436,123

The "Rest of other assets" item includes mainly prepaid expenses, the accrual of customer fees and commissions, and transactions in progress pending settlement.

Movements in inventories in 2024 and 2023 were as follows:

Thousand euro	Note	Land	Buildings under construction	Completed buildings	Total
Balance as at 31 December 2022		5,469	872	87,493	93,835
Additions		422	39	4,978	5,439
Disposals		(1,268)	(50)	(20,714)	(22,032)
Impairment through profit or loss	35	(1,711)	(4,505)	(13,060)	(19,276)
Reversal of impairment through profit or loss	35	710	4,210	37	4,957
Other transfers	15	—	—	(579)	(579)
Balance as at 31 December 2023		3,622	566	58,155	62,344
Additions		3,014	1	967	3,982
Disposals		(1,478)	(135)	(13,065)	(14,678)
Impairment through profit or loss	35	(3,613)	(80)	(7,852)	(11,545)
Reversal of impairment through profit or loss	35	984	33	2,889	3,906
Other transfers	15	—	—	(233)	(233)
Balance as at 31 December 2024		2,529	385	40,861	43,776

As at 31 December 2024 and 2023, the amount of inventories associated with debt secured with mortgages was 8,542 thousand euros and 10,292 thousand euros, respectively.

The composition of the "Other liabilities" heading as at 31 December 2024 and 2023 is as follows:

Thousand euro
	31/12/2024	31/12/2023
Other accrual/deferral	481,674	574,997
Rest of other liabilities	169,990	147,527
Total	651,664	722,524

The "Rest of other liabilities" item mainly includes transactions in progress pending settlement.

Note 18 – Deposits in central banks and credit institutions

The breakdown of the balance of deposits in central banks and credit institutions in the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro	2024	2023
By heading:
Financial liabilities at amortised cost	16,518,534	23,616,543
Total	16,518,534	23,616,543
By nature:
Demand deposits	200,690	222,195
Deposits with agreed maturity	4,162,902	12,274,576
Repurchase agreements	11,998,233	10,821,129
Other accounts	81,595	74,163
Valuation adjustments	75,114	224,480
Total	16,518,534	23,616,543
By currency:
In euro	13,489,227	17,615,523
In foreign currency	3,029,307	6,001,020
Total	16,518,534	23,616,543

The last tranche of TLTRO III matured in March 2024 (see Note 4.4.3.1 - Liquidity and funding risk) while, as at the end of 2024, the balance of funds drawn from funding operations with the European Central Bank was zero (5 billion euros as at the end of 2023).

Note 19 – Customer deposits

The balance of customer deposits on the consolidated balance sheets as at 31 December 2024 and 2023 breaks down as follows:

Thousand euro
	2024	2023
By heading:
Financial liabilities at amortised cost	169,822,647	160,330,653
Total	169,822,647	160,330,653
By nature:
Demand deposits	138,347,152	134,242,908
Deposits with agreed maturity	25,554,778	21,081,166
Fixed term	24,508,542	20,244,357
Non-marketable covered bonds and bonds issued	332,094	323,010
Other	714,142	513,799
Hybrid financial liabilities (see Notes 10 and 12)	5,491,959	4,507,056
Repurchase agreements	—	200,336
Other valuation adjustments (interest, fees and commissions, other)	428,758	299,187
Total	169,822,647	160,330,653
By sector:
General governments	9,568,545	7,869,390
Other sectors	159,825,344	152,162,076
Other valuation adjustments (interest, fees and commissions, other)	428,758	299,187
Total	169,822,647	160,330,653
By currency:
In euro	119,018,040	111,953,190
In foreign currency	50,804,607	48,377,463
Total	169,822,647	160,330,653

Note 20 – Debt securities in issue

The composition of this heading in the consolidated balance sheets as at 31 December 2024 and 2023, by type of issuance, is as follows:

Thousand euro
	2024	2023
Straight bonds/debentures	9,311,305	8,671,400
Straight bonds	9,293,205	8,630,100
Structured bonds	18,100	41,300
Commercial paper	511,347	1,382,828
Mortgage covered bonds	7,375,000	7,475,000
TSB covered bonds	3,816,529	3,164,376
Asset-backed securities	2,150,865	1,370,573
Subordinated marketable debt securities	4,050,000	3,550,000
Subordinated bonds	2,300,000	1,800,000
Preferred securities	1,750,000	1,750,000
Valuation and other adjustments	221,892	177,107
Total	27,436,938	25,791,284

Schedule III shows details of the outstanding issues as at 2024 and 2023 year-end.

The remuneration for preferred securities contingently convertible into ordinary shares amounts to 98,155 thousand euros in 2024 (115,391 thousand euros in 2023) and is recognised under the "Other reserves" heading in the consolidated statement of equity (see Note 1.3.3).

Note 21 – Other financial liabilities

The composition of this heading on the consolidated balance sheets as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024	2023
By heading:
Financial liabilities at amortised cost	6,450,130	6,333,286
Total	6,450,130	6,333,286
By nature:
Debentures payable	259,184	293,380
Guarantee deposits received	8,050	8,688
Clearing houses	786,525	1,138,627
Collection accounts	3,897,375	3,379,742
Lease liabilities	928,901	947,469
Other financial liabilities	570,095	565,380
Total	6,450,130	6,333,286
By currency:
In euro	4,783,749	4,694,730
In foreign currency	1,666,381	1,638,556
Total	6,450,130	6,333,286

The following table shows information relating to the average time taken to pay suppliers (days payable outstanding), as required by Additional Provision Three of Law 15/2010, taking into consideration the amendments introduced by Law 18/2022 of 28 September on the creation and growth of companies:

	2024	2023
Average payment period and supplier payment ratios (in days)
Days payable outstanding	24.51	25.49
Ratio of transactions paid (*)	24.57	25.49
Ratio of transactions pending payment (**)	15.64	38.81
Payments made and pending at year-end (in thousand euro)
Total payments made	1,190,762	1,194,239
Total payments outstanding	7,933	369
Payments made in < 60 days (in thousand euro) (***)
Monetary volume of paid invoices	1,122,990	1,110,490
Percentage of total amount of payments to suppliers	94	93
Number of invoices paid in < 60 days (***)
Number of invoices paid	134,569	133,690
Percentage of total number of invoices	93	92

The calculations above only take into account transactions undertaken by the Group's main Spanish entities, which represent 99.15% of total invoicing.

(*) The ratio of transactions paid is equal to the amount of each transaction paid multiplied by the number of days elapsed since the date of receipt of the invoice until its payment, divided by the total amount of payments made.

(**) The ratio of transactions pending payment is equal to the amount of each transaction pending payment multiplied by the number of days elapsed since the date of receipt of the invoice until the last day of the period, divided by the total amount of pending payments.

(***) Corresponds to invoices paid within the maximum period established in regulations on late payment.

Note 22 – Provisions and contingent liabilities

Movements during 2024 and 2023 under the "Provisions" heading are shown below:

Thousand euro

	Pensions and other post employment defined benefit obligations	Other long term employee benefits	Pending legal issues and tax litigation	Commitments and guarantees given	Other provisions	Total
Balance as at 31 December 2022	63,384	170	89,850	176,823	314,282	644,509
Scope additions / exclusions	—	—	—	—	—	—
Interest and similar expenses - pension commitments	1,755	4	—	—	—	1,759
Allowances charged to income statement - staff expenses (*)	3,171	4	—	—	26,595	29,770
Allowances not charged to income statement	—	—	—	—	—	—
Allowances charged to income statement - provisions Allocation of provisions Reversal of provisions Actuarial losses / (gains)	1,260 1,260 — —	(4) — — (4)	(4,560) 1,209 (5,769) —	(11,403) 211,347 (222,750) —	20,997 26,872 (5,875) —	6,290 240,688 (234,394) (4)
Exchange differences	648	—	—	1,295	2,488	4,431
Utilisations: Net contributions of plan assets by sponsor Pension payments Other	(9,139) 233 (9,372) —	(105) — (105) —	(24,740) — — (24,740)	— — — —	(114,583) — — (114,583)	(148,567) 233 (9,477) (139,323)
Other movements	(2,771)	—	—	(1,339)	2,010	(2,100)
Balance as at 31 December 2023	58,308	69	60,550	165,376	251,789	536,092
Scope additions / exclusions	—	—	—	—	—	—
Interest and similar expenses - pension commitments	2,651	2	—	—	—	2,653
Allowances charged to income statement - staff expenses (*)	1,010	4	—	—	10,281	11,295
Allowances not charged to income statement	—	—	—	—	—	—
Allowances charged to income statement - provisions Allocation of provisions Reversal of provisions Actuarial losses / (gains)	677 677 — —	— — — —	45,910 47,975 (2,065) —	(24,842) 166,761 (191,603) —	22,017 37,462 (15,445)	43,762 252,875 (209,113) —
Exchange differences	(1,148)	—	—	(520)	2,764	1,096
Utilisations: Net contributions of plan assets by sponsor Pension payments	(9,417) (1,941) (7,476)	(35) — (35)	(31,396) — —	— — —	(80,790) — —	(121,638) (1,941) (7,511)
Other	—	—	(31,396)	—	(80,790)	(112,186)
Other movements	2,386	—	—	2,468	140	4,994
Balance as at 31 December 2024	54,467	40	75,064	142,482	206,201	478,254

(*) See Note 33.

The headings "Pensions and other post employment defined benefit obligations" and "Other long term employee benefits" include the amount of provisions allocated for the coverage of post-employment remuneration and commitments undertaken with early retirees and similar obligations.

The heading "Commitments and guarantees given" includes the amount of provisions allocated for the coverage of commitments given and contingent risks arising from financial guarantees or other types of contracts.

During the usual course of business, the Group is exposed to fiscal, legal and regulatory contingencies, among others. All significant contingencies are analysed on a regular basis, with the collaboration of thirdparty experts where necessary and, where appropriate, provisions are recognised under the headings "Pending legal issues and tax litigation" and "Other provisions". As at 31 December 2024 and 2023, these headings mainly include:

• Provisions for legal contingencies amounting to 13 million euros as at 31 December 2024 (17 million euros as at 31 December 2023).
• Other provisions for legal contingencies in Spain arising from customer claims in connection with certain general contractual terms and conditions amounting to 153 million euros (150 million euros as at 31 December 2023). The most significant provision relates to the possible reimbursement of amounts received as a result of the application of mortgage floor clauses, whether as a result of the hypothetical voiding of floor clauses by the courts of law or whether due to the implementation of Royal Decree-Law 1/2017 of 20 January on measures to protect consumers regarding floor clauses, in the amount of 71 million euros as at 31 December 2024 (81 million euros as at 31 December 2023). In an unlikely adverse scenario of potential additional claims being filed, both through the procedures established by the Institution in accordance with that set forth in the aforesaid Royal Decree, and through court proceedings, applying the percentages set forth in the current arrangements, the maximum contingency would amount to 90 million euros.

With regard to these provisions, the Bank considers its floor clauses to be transparent and clear to customers, and in general, these have not been definitively voided with a final ruling. On 12 November 2018, Section 28 of the Civil Division of the Provincial Court of Madrid issued a ruling in which it partially supported the appeal brought forth by Banco de Sabadell, S.A. against the ruling issued by Commercial Court no. 11 of Madrid on the invalidity of the restrictive interest rate clauses, considering that some of the clauses established by Banco de Sabadell, S.A. are transparent and valid in their entirety. With regard to the rest of the clauses, the Bank still considers that it has legal arguments which should be reviewed in the legal appeal which the Institution filed with the Supreme Court, with regard to the ruling made by the Provincial Court of Madrid. The Supreme Court referred the matter to the Court of Justice of the European Union (CJEU) for a preliminary ruling, which was issued on 4 July 2024. An appeal in cassation before the Supreme Court remains pending.

The remaining provisions mainly relate to customer claims in connection with the repayment of mortgage arrangement fees, developer deposit funds and the application of unfair interest rates to deferred credit card payments, with the provision set aside amounting to 81 million euros as at 31 December 2024 (69 million euros as at 31 December 2023).

• Provisions to cover the anticipated costs relating to restructuring plans in Spain announced in previous years and pending final implementation amounting to 56 million euros as at 31 December 2024 and 2023.
• Provisions for legal contingencies deriving from claims filed by certain TSB customers. The estimated potential cost of compensation payable, which includes compensatory interest and associated operational costs, amounted to 9 million euros as at 31 December 2024 (19 million euros as at 31 December 2023).
• Provisions to cover the anticipated costs relating to restructuring in TSB and pending final implementation amounting to 13 million euros as at 31 December 2024 (35 million euros as at 31 December 2023), of which 10 million euros were allocated in 2024 (26 million euros as at 31 December 2023) (see Note 33).

The final disbursement amount and the payment schedule are uncertain due to the difficulties inherent in estimating the factors used to determine the amount of the provisions set aside.

Pensions and similar obligations

Defined benefit plans cover all existing commitments arising from the application of the Collective Bargaining Agreement for Banks (Convenio Colectivo de Banca). These commitments are financed through the following vehicles:

Pension plan

Banco Sabadell's Employee Pension Plan (hereinafter, BSEPP) covers the benefits payable under the collective bargaining agreement with employees belonging to regulated groups, with the following exceptions:

• Additional commitments due to early retirement, as set out in the Collective Bargaining Agreement for Banks.
• Supervening incapacity in certain circumstances.
• Widowhood and orphanhood benefits arising from the death of a retired member of staff who began their employment after 8 March 1980.

The BSEPP is regarded to all intents and purposes as a plan asset for the obligations insured by entities outside of the Group. Obligations of the pension plan insured by the Group's associate entities are not considered plan assets. Those obligations are considered as reimbursement rights.

A Control Board has been created for the BSEPP, formed of representatives of the sponsor and representatives of the participants and beneficiaries. This Control Board is the body responsible for supervising its operation and execution.

Insurance contracts

Insurance contracts generally cover certain commitments arising from the Collective Bargaining Agreement for Banks, including in particular:

• Commitments expressly excluded from the BSEPP (indicated in the previous section).
• Serving employees covered by a collective bargaining agreement of Banco Atlántico.
• Pension commitments undertaken with certain serving employees not provided for under the collective bargaining agreement.
• Commitments towards employees on extended leave of absence not covered with benefits accrued in the BSEPP.
• Commitments towards early retirees; these may be partly financed with benefits accrued in the BSEPP.

These insurance policies have been arranged with insurance companies outside the Group, whose insured commitments are mainly those towards former Banco Atlántico employees, and with BanSabadell Vida, S.A. de Seguros y Reaseguros.

Voluntary social welfare agency (Entidad de Previsión Social Voluntaria, or E.P.S.V.)

The acquisition and subsequent merger of Banco Guipuzcoano resulted in the takeover of Gertakizun, E.P.S.V., which covers defined benefit commitments in respect of serving and former employees, who are insured by insurance contracts. It was set up by the aforesaid bank in 1991 as an agency with a separate legal personality. All obligations with respect to serving and former employees are insured by entities outside the Group.

Internal funds

Internal funds are used to settle obligations with early retirees up to their legal retirement age and relate to employees previously working for Banco Sabadell.

The origins of liabilities recognised in respect of post-employment benefits and other similar long-term obligations on the Group's balance sheet are shown below:

Thousand euro	2024	2023	2022	2021	2020
Obligations arising from pension and similar commitments Fair value of plan assets	522,170 (467,663)	509,946 (451,569)	565,046 (501,492)	739,456 (652,786)	819,789 (716,128)
Net liability recognised on balance sheet	54,507	58,377	63,554	86,670	103,661

The return on Banco Sabadell's employee pension plan was 6.65% and that of the E.P.S.V. was 0.57% in 2024 (5.37% and -0.17%, respectively, in 2023).

Movements during 2024 and 2023 in obligations due to pensions and similar commitments and the fair value of the plan assets are as follows:

Thousand euro	Obligations arising
	from pension and similar commitments	Fair value of plan assets	Net liability recognised on balance sheet
Balance as at 31 December 2022	565,046	501,492	63,554
Interest costs	18,090	—	18,090
Interest income	—	15,693	(15,693)
Normal cost in year	1,876	—	1,876
Past service cost	1,063	—	1,063
Benefits paid	(46,726)	(37,250)	(9,476)
Payments for settlements, curtailments and terminations	(470)	(1,300)	830
Net contributions by the Institution	—	(233)	233
Actuarial gains or losses from changes in demographic assumptions	—	—	—
Actuarial gains or losses from changes in financial assumptions	(23,195)	—	(23,195)
Actuarial gains or losses from experience	(11,004)	—	(11,004)
Return on plan assets excluding interest income	—	(31,391)	31,391
Other movements	4,618	4,558	60
Exchange differences	648	—	648
Balance as at 31 December 2023	509,946	451,569	58,377
Interest costs Interest income	18,908 —	— 16,255	18,908 (16,255)
Normal cost in year	1,014	—	1,014
Past service cost Benefits paid	630 (43,758)	— (36,247)	630 (7,511)
Settlements, curtailments and terminations	(1,570)	(1,570)	—
Net contributions by the Institution	—	1,941	(1,941)
Actuarial gains or losses from changes in demographic assumptions	—	—	—
Actuarial gains or losses from changes in financial assumptions	33,121	—	33,121
Actuarial gains or losses from experience	3,902	—	3,902
Return on plan assets excluding interest income	—	34,590	(34,590)
Other movements	1,125	1,125	—
Exchange differences	(1,148)	—	(1,148)
Balance as at 31 December 2024	522,170	467,663	54,507

The breakdown of the Group's pension commitments and similar obligations as at 31 December 2024 and 2023, based on the financing vehicle, coverage and the interest rate applied in their calculation, is given below:

	2024
Financing vehicle	Coverage	Amount	Interest rate
Pension plans		239,514
Insurance policies with related parties	Matched	22,631	3.00 %
Insurance policies with unrelated parties	Matched	216,322	3.00 %
Insurance policies with unrelated parties	Without cover	561	3.00 %
Insurance contracts		275,282
Insurance policies with related parties	Matched	55,164	3.00 %
Insurance policies with unrelated parties	Matched	220,118	3.00 %
Internal funds		7,374
Mexico internal funds	Without cover	40	3.00 %
Spain internal funds	Without cover	7,334	11.25 %
Total obligations		522,170

Thousand euro
	2023
Financing vehicle	Coverage	Amount	Interest rate
Pension plans		236,299
Insurance policies with related parties	Matched	22,709	3.75 %
Insurance policies with unrelated parties	Matched	213,150	3.75 %
Insurance policies with unrelated parties	Without cover	440	3.75 %
Insurance contracts		266,615
Insurance policies with related parties	Matched	55,095	3.75 %
Insurance policies with unrelated parties	Matched	211,520	3.75 %
Internal funds		7,032
Mexico internal funds	Without cover	69	3.75 %
Spain internal funds	Without cover	6,963	11.25%
Total obligations		509,946

The value of the obligations under the pension plans and insurance contracts covered by matched insurance policies as at 31 December 2024 amounted to 514,235 thousand euros (502,474 thousand euros as at 31 December 2023); therefore, in 98.48% of its commitments (98.53% as at 31 December 2023), there is no mortality risk (mortality tables) or profitability risk (interest rate) for the Group. Therefore, the evolution of interest rates and demography of groups in 2024 had no impact on the Institution's capacity to pay its pension commitments.

The sensitivity analysis for the actuarial assumptions of the technical interest rate and the rate of salary increase shown in Note 1.3.17 to these consolidated annual financial statements, as at 31 December 2024 and 2023, shows how the obligation and the service cost of the current year would have been affected by changes deemed reasonably possible as at that date.

%
	2024	2023
Sensitivity analysis	Percentage change
Discount rate
Interest rate -50 basis points:
Assumption	2.50 %	3.25 %
Change in obligation	4.75 %	4.59 %
Change in current service cost	11.75 %	10.64 %
Interest rate +50 basis points:
Assumption	3.50 %	4.25 %
Change in obligation	(4.38) %	(4.24) %
Change in current service cost	(10.06) %	(9.19) %
Rate of salary increase
Rate of salary increase -50 basis points:
Assumption	2.50 %	2.50 %
Change in obligation	(0.01) %	(0.01) %
Change in current service cost	(3.61) %	(3.03) %
Rate of salary increase +50 basis points:
Assumption	3.50 %	3.50 %
Change in obligation	0.01 %	0.01 %
Change in current service cost	4.86 %	3.50 %

The estimate of probable present values, as at 31 December 2024, of benefits payable for the next ten years, is set out below:

Thousand euro

	Years
	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	Total
Probable pensions	8,184	7,853	7,757	7,631	8,047	8,330	8,007	7,677	7,344	7,008	77,838

The fair value of contracts linked to pensions (reimbursement rights) recognised on the consolidated balance sheet amounted to 80,888 thousand euros as at 31 December 2024 (80,693 thousand euros as at 31 December 2023); see Note 17.

The main categories of the plan assets as at 31 December 2024 and 2023 are indicated here below:

%	2024	2023
Mutual funds	3.37 %	3.63 %
Deposits and guarantees	0.42 %	0.38 %
Other (non-linked insurance policies)	96.21 %	95.99 %
Total	100 %	100 %

There were no financial instruments issued by the Bank included in the fair value of plan assets as at 31 December 2024 and 2023.

Note 23 – Shareholders' equity

The breakdown of the balance of shareholders' equity on the consolidated balance sheets as at 31 December 2024 and 2023 is the following:

Thousand euro

	2024	2023
Capital	680,028	680,028
Share premium	7,695,227	7,695,227
Other equity	25,407	21,268
Retained earnings	7,373,498	6,401,782
Other reserves	(1,663,461)	(1,584,816)
(-) Treasury shares	(119,352)	(39,621)
Profit or loss attributable to owners of the parent	1,826,806	1,332,181
(-) Interim dividends	(428,911)	(162,103)
Total	15,389,242	14,343,946

Capital

The Bank's share capital as at 31 December 2024 and 2023 stood at 680,027,680.875 euros and is represented by 5,440,221,447 registered shares with a par value of 0.125 euros each. All shares are fully paid up and numbered in sequential order from 1 to 5,440,221,447, inclusive.

On 29 January 2025, the Board of Directors of Banco Sabadell agreed to reduce the Bank's share capital in the amount of 6,566 thousand euros, through the redemption charged to unrestricted reserves of all the treasury shares acquired under the share buyback programme approved on 10 April 2024 by the shareholders at the Banco Sabadell Annual General Meeting, until the suspension of that programme on 9 May 2024, i.e. 52,531,365 shares with a par value of 0.125 euros each, representing approximately 0.97% of the Bank's share capital. This capital reduction was approved as part of the resolution adopted at the aforesaid Annual General Meeting of 10 April 2024. After the aforesaid capital reduction through the redemption of treasury shares agreed by the Bank's Board of Directors on 29 January 2025, the Bank's share capital will stand at 673,461,260.25 euros and will be represented by 5,387,690,082 registered shares with a par value of 0.125 euros each, all fully paid up and numbered in sequential order from 1 to 5,387,690,082, inclusive. This transaction does not entail the reimbursement of contributions made by shareholders, as the Bank is the holder of the redeemed shares. As at the sign-off date of these annual financial statements, the public deed for this capital reduction and its entry in the Companies Register remained pending.

The Bank's shares are traded on the Barcelona, Bilbao, Madrid and Valencia stock exchanges through the stock exchange interconnection system operated by Sociedad de Bolsas, S.A.

None of the other subsidiary companies included in the scope of consolidation are listed on the stock exchange.

The rights conferred to the equity instruments are those regulated by the Capital Companies Act. During the Annual General Meeting, shareholders may exercise a percentage of votes equivalent to the percentage of the share capital in their possession. The Articles of Association do not contain any provision for additional loyalty voting rights.

Capital reduction in 2023

On 30 November 2023, the Board of Directors of Banco Sabadell agreed to reduce the Bank's share capital in the amount of 23,343 thousand euros, through the redemption charged to unrestricted reserves of all the treasury shares acquired under the share buyback programme, i.e. 186,743,254 shares with a par value of 0.125 euros each, representing approximately 3.32% of the Bank's share capital (see Note 3). This capital reduction was approved as part of the resolution adopted by the Annual General Meeting on 23 March 2023.

The capital reduction and the amendment to Article 7 of the Articles of Association relating to share capital were entered in the Companies Register of Alicante on 11 December 2023, the reduction being thus completed and the redeemed shares delisted.

This operation did not entail the reimbursement of contributions made by shareholders, as the Bank was the holder of the redeemed shares.

Significant investments in the Bank's capital

As required by Articles 23 and 32 of Royal Decree 1362/2007 of 19 October, implementing Securities Market Law 24/1988 of 28 July, on transparency requirements relating to information on issuers whose securities have been admitted to trading on an official secondary market or on any other European Union regulated market, the following table gives details of significant investments in Banco Sabadell's share capital as at 31 December 2024:

Name or company name of shareholder	% of voting rights assigned to shares		% of voting rights through financial instruments		Total % of
	Direct	Indirect	Direct	Indirect	voting rights
BlackRock, Inc (1)	—%	6.20%	—%	0.10%	6.30%
Dimensional Fund Advisors LP (2)	—%	3.73%	—%	—%	3.73%
David Martínez Guzmán (3)	—%	3.56%	—%	—%	3.56%
Zurich Insurance Group Ltd (4)	—%	3.02%	—%	—%	3.02%

The sources for the information provided are communications sent by shareholders to the National Securities Market Commission (CNMV) or directly to the Bank. In accordance with Royal Decree 1362/2007 of 19 October, implementing Securities Market Law 24/1998 of 28 July, on transparency requirements relating to information on issuers whose securities have been admitted to trading on an official secondary market or on any other European Union regulated market, a shareholder is considered to own a significant shareholding when they have in their possession a proportion of at least 3% of the voting rights, or 1% in the case of residents in tax havens.

(1) BlackRock, Inc. owns an indirect shareholding through several of its subsidiaries.

(2) Dimensional Fund Advisors LP disclosed the shares held in funds and accounts advised by either itself or by its subsidiary undertakings. The voting rights correspond to shares held in those funds and accounts. Neither Dimensional Fund Advisors LP nor any of its subsidiaries are beneficial owners of those shares and/or their voting rights.

(3) Fintech Europe, S.À.R.L. (FE) is 100% owned by Fintech Investments Ltd. (FIL), which is the investment fund managed by Fintech Advisory Inc. (FAI). FAI is 100% owned by David Martínez Guzmán. Consequently, the stake currently held by FE is deemed to be under the control of David Martínez Guzmán.

(4) Zurich Insurance Group Ltd. is the parent company of Zurich Group and directly owns 100% of Zurich Insurance Company Ltd, which in turn holds the direct shareholding in Banco de Sabadell, S.A.

Share premium

The balance of the share premium as at 31 December 2024 amounted to 7,695,227 thousand euros.

In 2023, the share premium was reduced by 180,657 thousand euros, which corresponds to the difference between the purchase price of the shares redeemed as part of the Bank's capital reduction explained in this note (204,000 thousand euros) and the nominal value of those shares (23,343 thousand euros).

Furthermore, pursuant to applicable legislation, a restricted capital redemption reserve was created in 2023, with a charge to the share premium in an amount equal to the nominal value of the redeemed shares, 23,343 thousand euros, subject to the same disposal requirements applied for the share capital reduction.

Retained earnings and Other reserves

The balance of these headings of the consolidated balance sheets as at 31 December 2024 and 2023 breaks down as follows:

Thousand euro
	2024	2023
Restricted reserves:	233,914	228,033
Statutory reserve	136,006	140,674
Reserve for treasury shares pledged as security	60,426	50,061
Reserve for investments in the Canary Islands	11,024	10,840
Reserve for redenomination of share capital	113	113
Capital redemption reserve	26,345	26,345
Unrestricted reserves	5,397,108	4,534,097
Reserves of entities accounted for using the equity method	79,016	54,836
Total	5,710,038	4,816,966

At the Annual General Meeting of 10 April 2024 the shareholders approved, as proposed by the Board of Directors, the reclassification to voluntary reserves of the amount held in the statutory reserve in excess of 20% of the share capital resulting from the capital reduction carried out during 2023, that is, 4,668 thousand euros.

Information on the reserves of each of the consolidated companies is indicated in Schedule I.

Other equity

This heading includes share-based remuneration pending settlement which, as at 31 December 2024 and 2023, amounted to 25,407 thousand euros and 21,268 thousand euros, respectively.

Treasury shares

The movements of the parent company's shares acquired by the Bank are as follows:

		Nominal value	Average price
	No. of shares	(in thousand euro)	(in euro)	% Shareholding
Balance as at 31 December 2022	24,772,683	3,096.58	0.96	0.44
Purchases	248,821,193	31,102.65	1.10	4.43
Sales	236,416,334	29,552.04	1.11	4.21
Balance as at 31 December 2023	37,177,542	4,647.19	1.07	0.68
Purchases	68,001,385	8,500.17	1.65	1.25
Sales	26,338,537	3,292.32	1.27	0.48
Balance as at 31 December 2024	78,840,390	9,855.04	1.51	1.45

Net gains and losses arising from transactions involving own equity instruments are included under the heading "Shareholders' equity – Other reserves" on the consolidated balance sheet, and they are shown in the statement of changes in equity, in the row corresponding to the sale or cancellation of treasury shares.

As at 31 December 2024, TSB held 4,720 Banco Sabadell shares (232 as at 31 December 2023), with a cost of 7,741 euros (255 euros as at 31 December 2023), which are recorded as treasury shares on the consolidated balance sheet.

As at 31 December 2024, the number of the Bank's shares pledged as collateral for transactions was 32,192,958 with a nominal value of 4,024 thousand euros (44,978,083 shares with a nominal value of 5,622 thousand euros as at 31 December 2023).

The number of Banco de Sabadell, S.A. equity instruments owned by third parties but managed by the different companies of the Group amounted to 2,557,673 and 12,398,979 securities as at 31 December 2024 and 2023, respectively. Their nominal value as at the aforesaid dates amounted to 320 thousand euros and 1,550 thousand euros, respectively. In both years, 100% of the securities corresponded to Banco Sabadell shares.

Note 24 – Accumulated other comprehensive income

The composition of this heading of consolidated equity as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024	2023
Items that will not be reclassified to profit or loss	(22,460)	(30,596)
Actuarial gains or (-) losses on defined benefit pension plans	(1,826)	(3,313)
Non-current assets and disposal groups classified as held for sale	—	—
Share of other recognised income and expense of investments in joint ventures and
associates	—	—
Fair value changes of equity instruments measured at fair value through other
comprehensive income	(20,634)	(27,283)
Hedge ineffectiveness of fair value hedges for equity instruments measured at fair value
through other comprehensive income	—	—
Fair value changes of equity instruments measured at fair value through other
comprehensive income [hedged item]	—	—
Fair value changes of equity instruments measured at fair value through other
comprehensive income [hedging instrument]	—	—
Fair value changes of financial liabilities at fair value through profit or loss attributable to
changes in their credit risk	—	—
Items that may be reclassified to profit or loss	(368,643)	(468,357)
Hedge of net investments in foreign operations [effective portion] (*)	91,740	77,997
Foreign currency translation	(299,293)	(384,086)
Hedging derivatives. Cash flow hedges [effective portion] (**)	(48,300)	(49,215)
Amount deriving from outstanding operations	(64,209)	(71,464)
Amount deriving from discontinued operations	15,909	22,249
Fair value changes of debt instruments measured at fair value through other comprehensive
income	(151,279)	(145,732)
Hedging instruments [not designated elements]	—	—
Non-current assets and disposal groups classified as held for sale	—	—
Share of other recognised income and expense of investments in joint ventures and
associates	38,489	32,679
Total	(391,103)	(498,953)

(*) The value of the hedge of net investments in foreign operations is fully obtained from outstanding transactions (see Note 12).

(**) Cash flow hedges mainly mitigate interest rate risk and other risks (see Note 12).

The breakdown of the items in the consolidated statement of recognised income and expenses as at 31 December 2024 and 2023, indicating their gross and net of tax effect amounts, is as follows:

Thousand euro

	2024				2023
	Gross value	Tax effect	Net	Gross value	Tax effect	Net
Items that will not be reclassified to profit or loss	11,833	(3,697)	8,136	(669)	(802)	(1,471)
Actuarial gains or (-) losses on defined benefit pension plans	2,124	(637)	1,487	(1,919)	575	(1,344)
Non-current assets and disposal groups classified as held for sale	—	—	—	—	—	—
Share of other recognised income and expense of investments in joint ventures and associates	—	—	—	—	—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income	9,709	(3,060)	6,649	1,250	(1,377)	(127)
Hedge ineffectiveness of fair value hedges for equity instruments measured at fair value through other comprehensive income	—	—	—	—	—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedged item]	—	—	—	—	—	—
Fair value changes of equity instruments measured at fair value through other comprehensive income [hedging instrument]	—	—	—	—	—	—
Fair value changes of financial liabilities at fair value through profit or loss attributable to changes in their credit risk	—	—	—	—	—	—
Items that may be reclassified to profit or loss	99,029	685	99,714	107,466	(21,548)	85,918
Hedge of net investments in foreign operations [effective portion]	13,743	—	13,743	(41,351)	—	(41,351)
Foreign currency translation	84,794	—	84,794	91,944	—	91,944
Hedging derivatives. Cash flow hedges reserve [effective portion]	856	59	915	22,291	(7,282)	15,009
Fair value changes of debt instruments measured at fair value through other comprehensive income	(6,174)	626	(5,548)	48,733	(14,266)	34,467
Hedging instruments [not designated elements]	—	—	—	—	—	—
Non-current assets and disposal groups classified as held for sale	—	—	—	—	—	—
Share of other recognised income and expense of investments in joint ventures and associates	5,810	—	5,810	(14,151)	—	(14,151)
Total	110,862	(3,012)	107,850	106,797	(22,350)	84,447

Note 25 – Minority interests (non-controlling interests)

The companies comprising this heading of consolidated equity as at 31 December 2024 and 2023 are the following:

Thousand euro

		2024			2023
	% Minority interests	Amount	Of which: Profit/ (loss) attributed	% Minority interests	Amount	Of which: Profit/ (loss) attributed
Aurica Coinvestment, S.L.	38.24 %	33,617	1,803	38.24 %	33,433	1,498
Other	—	799	18	—	780	(76)
Total		34,416	1,821		34,213	1,422

Movements in the balance under this heading in 2024 and 2023 were as follows:

Thousand euro
Balances as at 31 December 2022	34,344
Valuation adjustments	—
Other	(131)
Scope additions / exclusions	—
Percentage shareholding and other	(1,553)
Profit or loss for the year	1,422
Balances as at 31 December 2023	34,213
Valuation adjustments	—
Other	203
Scope additions / exclusions	—
Percentage shareholding and other	(1,618)
Profit or loss for the year	1,821
Balances as at 31 December 2024	34,416

The dividends distributed to minority shareholders of Group entities in 2024 amounted to 1,618 thousand euros and were distributed by Aurica Coinvestment, S.L. (1,618 thousand euros in 2023).

Note 26 – Off-balance sheet exposures

The breakdown of this heading for the years ended 31 December 2024 and 2023 is the following:

Commitments and guarantees given	Note	2024	2023
Loan commitments given		28,775,335	27,035,812
Of which, amount classified as stage 2		716,238	986,368
Of which, amount classified as stage 3		96,536	97,219
Drawable by third parties		28,775,335	27,035,812
By credit institutions		18,200	54
By general governments		961,635	910,744
By other resident sectors		16,955,467	15,565,366
By non-residents		10,840,033	10,559,648
Provisions recognised on liabilities side of the balance sheet	22	61,950	72,888
Financial guarantees given (*)		1,979,622	2,064,396
Of which, amount classified as stage 2		167,030	165,222
Of which, amount classified as stage 3		38,046	44,828
Provisions recognised on liabilities side of the balance sheet (**)	22	15,760	23,814
Other commitments given		9,366,339	7,942,724
Of which, amount classified as stage 2		333,588	372,597
Of which, amount classified as stage 3		168,964	222,999
Other guarantees given		6,719,453	6,832,086
Assets earmarked for third-party obligations		—	—
Irrevocable letters of credit		650,917	729,299
Additional settlement guarantee		25,000	25,000
Other guarantees and sureties given		6,043,536	6,077,787
Other contingent risks		—	—
Other commitments given		2,646,886	1,110,638
Financial asset forward purchase commitments		2,567,269	1,007,047
Conventional financial asset purchase contracts		1	8,249
Capital subscribed but not paid up		19	19
Underwriting and subscription commitments		—	—
Other loan commitments given		79,597	95,323
Provisions recognised on liabilities side of the balance sheet	22	64,772	68,674

Total 40,121,296 37,042,932 (*) Includes 137,407 and 99,631 thousand euro as of 31 December 2024 and 2023, respectively, corresponding to financial guarantees given in connection with construction and real estate development.

(**) Includes 3,034 thousand euros and 3,402 thousand euros as at 31 December 2024 and 2023, respectively, corresponding to provisions for financial guarantees given in connection with construction and real estate development.

Total commitments drawable by third parties as at 31 December 2024 include home equity loan commitments amounting to 4,602,538 thousand euros (4,640,343 thousand euros as at 31 December 2023). As regards other commitments, in the majority of cases there are other types of guarantees which are in line with the Group's Risk Management Policy.

Financial guarantees and other commitments given classified as stage 3

The movement of the balance of financial guarantees and other commitments given classified as stage 3 during 2024 and 2023 was the following:

Thousand euro
Balances as at 31 December 2022	323,704
Additions	43,391
Disposals	(99,268)
Balances as at 31 December 2023	267,827
Additions	36,225
Disposals	(97,042)
Balances as at 31 December 2024	207,010

The breakdown by geographical area of the balance of financial guarantees and other commitments given classified as stage 3 as at 31 December 2024 and 2023 is as follows:

Thousand euro

	2024	2023
Spain	204,136	265,046
Rest of European Union	398	448
United Kingdom	65	15
Americas	2,012	1,905
Rest of the world	399	413
Total	207,010	267,827

Credit risk allowances corresponding to financial guarantees and other commitments given as at 31 December 2024 and 2023, broken down by the method used to determine such allowances, are as follows:

Thousand euro
	2024	2023
Specific individually measured allowances:	62,700	67,247
Stage 2	4,112	7,454
Stage 3	58,588	59,793
Specific collectively measured allowances:	17,832	25,241
Stage 1	2,551	3,930
Stage 2	4,868	6,325
Stage 3	10,240	14,672
Others	173	314
Total	80,532	92,488

Movements in these allowances during the years 2024 and 2023, together with movements in allowances for loan commitments given, are shown in Note 22.

Note 27 – Off-balance sheet customer funds and financial instruments deposited by third parties

Off-balance sheet customer funds managed by the Group, those sold but not under management and the financial instruments deposited by third parties as at 31 December 2024 and 2023 are shown below:

	2024	2023
Off-balance sheet customer funds	46,171,179	40,560,556
Managed by the Group:	5,402,834	4,186,603
Investment companies	674,277	588,844
Asset management	4,728,557	3,597,759
Sold by the Group:	40,768,345	36,373,953
Mutual Funds	27,634,033	23,503,719
Pension funds	3,352,487	3,249,167
Insurance	9,781,825	9,621,067
Financial instruments deposited by third parties	76,280,262	66,753,270
Total	122,451,441	107,313,826

Note 28 – Interest income and expenses

These headings in the consolidated income statement include interest accrued during the year on all financial assets and financial liabilities the yield of which, implicit or explicit, is obtained by applying the effective interest rate approach, irrespective of whether they are measured at fair value or otherwise, and using corrections of income from hedge accounting operations.

The majority of interest income is generated by the Group's financial assets measured either at amortised cost or at fair value through other comprehensive income.

The breakdown of net interest income for the years ended 31 December 2024 and 2023 is the following:

Thousand euro
	2024	2023
Interest income
Loans and advances	8,205,119	7,286,718
Central banks	1,098,563	1,215,497
Credit institutions	403,414	281,945
Customers	6,703,142	5,789,276
Debt securities (*)	655,899	589,033
Stage 3 assets	17,244	27,036
Correction of income from hedging operations	752,708	671,414
Other interest	82,422	84,555
Total	9,713,392	8,658,756
Interest expense
Deposits	(3,036,412)	(2,480,542)
Central banks	(214,624)	(532,310)
Credit institutions	(542,467)	(526,696)
Customers	(2,279,321)	(1,421,536)
Debt securities issued	(858,921)	(700,109)
Correction of expenses on hedging operations	(559,431)	(566,050)
Other interest	(237,293)	(188,837)
Total	(4,692,057)	(3,935,538)
Net interest income	5,021,335	4,723,218

(*) Includes 79,050 thousand euro in 2024 and 69,956 thousand euro in 2023 corresponding to interest from financial assets recognised at fair value through profit and loss (trading portfolio).

The improvement in net interest income is mainly due to the higher yield of the loan book, which offsets the higher cost of customer funds and capital markets.

The average annual interest rate during 2024 and 2023 of the following balance sheet headings is shown below:

%	2024	2023
Assets
Cash, cash balances at central banks and other demand deposits	3.96	3.51
Debt securities	3.42	2.92
Loans and advances
Customers	4.36	3.79
Liabilities
Deposits
Central banks and Credit institutions	(3.97)	(3.38)
Customers	(1.23)	(0.89)
Debt securities issued	(4.15)	(3.32)

Positive (negative) figures correspond to income (expenses) for the Group.

Note 29 – Fee and commission income and expenses

Fee and commission income and expenses on financial operations and the provision of services are as follows:

	2024	2023
Fees from risk transactions	280,131	286,480
Asset-side transactions	177,921	183,209
Sureties and other guarantees	102,210	103,271
Service fees	759,819	796,822
Payment cards	227,140	251,815
Payment orders	81,673	82,296
Securities	62,578	57,028
Demand deposits	254,708	277,111
Other	133,720	128,572
Asset management and marketing fees	316,550	302,856
Mutual funds	121,104	114,912
Sale of pension funds and insurance products	164,043	165,075
Asset management	31,403	22,869
Total	1,356,500	1,386,158
Memorandum item
Fee and commission income	1,708,162	1,671,213
Fee and commission expenses	(351,662)	(285,055)
Fees and commissions, net	1,356,500	1,386,158

Note 30 – Net profit or net loss on financial operations and net exchange differences

"Net profit or net loss on financial operations" combines a series of headings from the consolidated income statement for the years ended 31 December 2024 and 2023, which are shown below:

Thousand euro
	2024	2023
By heading:
Gains or (-) losses on derecognition of financial assets and liabilities not measured
at fair value through profit or loss, net	10,546	23,250
Financial assets at fair value through other comprehensive income	6,663	4,304
Financial assets at amortised cost	4,769	15,939
Financial liabilities at amortised cost	(886)	3,007
Gains or (-) losses on financial assets and liabilities held for trading, net	(231,498)	122,249
Gains or (-) losses on non-trading financial assets mandatorily at fair value through
profit or loss, net	13,994	11,781
Gains or (-) losses on financial assets and liabilities designated at fair value through
profit or loss, net	—	—
Gains or (-) losses from hedge accounting, net	(33,844)	12,193
Total	(240,802)	169,473
By type of financial instrument:
Net gain/(loss) on debt securities	3,353	10,193
Net gain/(loss) on other equity instruments	(18,574)	7,100
Net gain/(loss) on derivatives	(236,120)	140,199
Net gain/(loss) on other items (*)	10,539	11,981
Total	(240,802)	169,473

(*) Mainly includes gains/(losses) on the loan portfolios sold during 2024 and 2023.

The breakdown of the heading "Exchange differences [gain or (-) loss], net" of the consolidated income statement for the years ended 31 December 2024 and 2023 is shown below:

Thousand euro
	2024	2023
Exchange differences [gain or (-) loss], net	327,904	(101,093)

The "Net gain/(loss) on derivatives" heading in the table above includes, among other things, the change in the fair value of derivatives used to hedge against the foreign exchange risk of debit and credit balances denominated in foreign currencies. As at 31 December 2024, the losses generated by these derivatives amounted to 312,872 thousand euros (gains of 143,569 thousand euros as at 31 December 2023), which are recognised under the heading "Gains or (-) losses on financial assets and liabilities held for trading, net" of the consolidated income statement, while the exchange differences generated by debit and credit balances denominated in foreign currencies hedged with these derivatives are recognised under the heading "Exchange differences [gain or (-) loss], net" of the consolidated income statement.

During 2024, the Group carried out sales of certain debt securities which it held in its portfolio of financial assets at fair value through other comprehensive income, generating profits of 6,663 thousand euros (4,304 thousand euros in 2023). Of those profits, 4,724 thousand euros (4,930 thousand euros in 2023) came from the sale of debt securities held with general governments.

Note 31 – Other operating income

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

	2024	2023
Income from use of investment properties (*)	20,137	22,850
Sales and other income from the provision of non-financial services	5,240	14,264
Other operating income	86,249	54,070
Total	111,626	91,184

(*) The amounts relate mainly to income from operating leases in which the Group acts as lessor.

The increase in the balance recognised under "Other operating income" is mainly due to income in the amount of 43 million euros recognised in 2024 in connection with the insurance taken out by the Group to offset the payment made by TSB to UK regulators due to the incidents that took place following its IT migration in 2018.

Note 32 – Other operating expenses

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

Thousand euro
	2024	2023
Contribution to deposit guarantee schemes	(25,083)	(150,784)
Banco Sabadell	(6,294)	(132,209)
TSB	(414)	(280)
BS IBM Mexico	(18,375)	(18,295)
Contribution to resolution fund	—	(76,485)
Other items	(380,139)	(310,959)
Of which: temporary levy of credit institutions and financial credit establishments (*)	(191,882)	(156,182)
Total	(405,222)	(538,228)

(*) See Note 1.3.19.

The reduction of the balance recognised under the heading "Contribution to deposit guarantee schemes" is due, mainly, to the fact that it has not been necessary to make annual contributions to the deposit guarantee under the DGF in 2024, as the fund had reached the legally required minimum of available financial resources as at 31 December 2023 (see Note 1.3.19).

Furthermore, the Bank did not receive any requirements from the Single Resolution Board to make contributions to the Single Resolution Fund (SRF) in 2024, the available financial means having reached, as at 31 December 2023, the minimum target level of at least 1% of covered deposits held in Member States participating in the Single Resolution Mechanism (see Note 1.3.19).

The "Other items" heading includes expenses corresponding to the Spanish tax on deposits of credit institutions, amounting to 37,972 thousand euros in 2024 (34,418 thousand euros in 2023), as well as expenses associated with non-financial activities.

Note 33 – Administrative expenses

This heading of the consolidated income statement includes expenses incurred by the Group corresponding to staff and other general administrative expenses.

Staff expenses

The staff expenses recognised in the consolidated income statement for the years ended 31 December 2024 and 2023 were as follows:

Thousand euro

	Note	2024	2023
Payrolls and bonuses for active staff		(1,164,306)	(1,095,399)
Social Security payments		(243,912)	(231,124)
Contributions to defined benefit pension plans	22	(1,014)	(3,175)
Contributions to defined contribution pension plans		(69,223)	(65,452)
Other staff expenses		(52,897)	(99,494)
Of which: restructuring plan in United Kingdom	22	(10,281)	(26,409)
Total		(1,531,352)	(1,494,644)

As at 31 December 2024 and 2023, the breakdown of the average workforce for all companies within the Group by category and sex is as follows:

Average number of employees
	2024			2023
	Men	Women	Total	Men	Women	Total
Senior management	566	295	861	514	245	759
Middle management	1,880	1,367	3,247	2,011	1,477	3,488
Specialist staff	5,554	7,315	12,869	5,379	7,248	12,627
Administrative staff	599	1,473	2,072	706	1,733	2,439
Total	8,599	10,450	19,049	8,610	10,703	19,313

The breakdown of the Group's average workforce with a disability of 33% or more, by category, as at 31 December 2024 and 2023 is as follows:

Average number of employees

	2024	2023
Senior management	8	9
Middle management	25	22
Specialist staff	205	210
Administrative staff	55	64
Total	293	305

As at 31 December 2024 and 2023, the breakdown of the Group's workforce by category and sex is as follows:

Number of employees

	2024			2023
	Men	Women	Total	Men	Women	Total
Senior management	569	297	866	529	262	791
Middle management	1,921	1,407	3,328	2,091	1,632	3,723
Specialist staff	5,467	7,215	12,682	5,341	7,077	12,418
Administrative staff	555	1,338	1,893	680	1,704	2,384
Total	8,512	10,257	18,769	8,641	10,675	19,316

Of the total workforce as at 31 December 2024, 287 employees had some form of recognised disability (300 as at 31 December 2023).

Long-term share-based complementary incentive scheme

Pursuant to the Remuneration Policy, the latest version of which was approved by the Board of Directors at its meeting of 20 December 2024, at the proposal of the Board Remuneration Committee, members of the Group's Identified Staff, with the exception of Non-Executive Directors, were allocated long-term remuneration through the schemes in effect during 2024, as described below:

Share-based complementary incentive scheme

TSB's Share Incentive Plan (SIP) provides its employees with the opportunity to own shares in Banco Sabadell and grants shares, where applicable, to certain senior employees as part of their hiring arrangements.

Long-term remuneration scheme

Every year, the Board of Directors, at the proposal of the Board Remuneration Committee, approves Long-Term Remuneration aimed at members of the Group's Identified Staff with allocated variable remuneration, with the exception of management staff assigned to TSB Banking Group Plc or its subsidiaries, which consists of allocating a certain amount to each beneficiary, determined based on a monetary amount corresponding to a percentage of each beneficiary's fixed remuneration. 55% of the incentive is paid in the Bank's shares (using the weighted average price of the last 20 trading sessions of the month of December of the first year of the accrual period to calculate the number of shares), with the remaining 45% paid in cash. The incentive accrual period consists of three financial years, beginning on 1 January of the financial year immediately following the date of its approval and ending two years later, on 31 December of the third financial year. The aforesaid accrual period in turn comprises two sub-periods:

– Individual annual targets measurement period: this period lasts one financial year, from 1 January to 31 December of the year following the date on which the incentive is approved. During that period, each beneficiary's annual targets are measured (formed of Group targets, management targets and individual targets) established to determine the "Adjusted Target".

– Group multi-year targets measurement period: this period lasts three financial years, beginning on 1 January of the financial year immediately following the date on which the incentive is approved and ending two years later, on 31 December of the third financial year. During that period, the Group's multi-year targets are measured in order to determine the final incentive, which is subject to the Risk Correction Factor. The Group's multi-year targets for each incentive are linked to the following indicators and weights, whose achievement percentages are used to calculate the final payment owed, if any, to management staff who have been assigned that incentive:

Incentive	Indicators and weights
Long-Term Remuneration 2019-2021, 2020-2022 and 2021-2023	- Total shareholder return (25%) - Group liquidity coverage ratio (25%) - CET1 capital indicator (25%) - Group return on risk-adjusted capital (RoRAC) (25%)
Long-term remuneration 2022-2024	- Total shareholder return (25%) - Group liquidity coverage ratio (25%) - CET1 capital indicator (25%) - Return on tangible equity (ROTE) (25%) - Total shareholder return (40%)
Long-Term Remuneration 2023-2025 and 2024-2026	- Return on tangible equity (ROTE) (40%)
	- Sustainability indicator (20%)

In addition to the achievement of the annual and multi-year targets described above, payment of the incentives is subject to the requirements set out in the general conditions of each long-term remuneration scheme.

The main characteristics of the current incentives of the long-term remuneration scheme are summarised below:

Thousand euro

Incentive	Date approved by Board of Directors	Incentive	Individual annual targets	Group multi-year targets			Amount pending
		accrual period	Measurement period	Measurement period	Percentage achievement	Final payment	payment as at 31/12/2024
2019-2021 Long-term remuneration	20/12/2018	01/01/2019 - 31/12/2021	01/01/2019 - 31/12/2019	01/01/2019 - 31/12/2021	0% total shareholder return. 100% liquidity coverage ratio. 100% CET1 indicator. 0% RoRAC indicator.	50% of target	222
2020-2022 Long-term remuneration	19/12/2019	01/01/2020 - 31/12/2022	01/01/2020 - 31/12/2020	01/01/2020 - 31/12/2022	50% total shareholder return. 100% liquidity coverage ratio. 100% CET1 indicator. 100% RoRAC indicator.	87.5% of target	348
2021-2023 Long-term remuneration	17/12/2020	01/01/2021 - 31/12/2023	01/01/2021 - 31/12/2021	01/01/2021 - 31/12/2023	100% total shareholder return. 100% liquidity coverage ratio. 100% CET1 indicator. 100% RoRAC indicator.	100% of target	4,533
2022-2024 Long-term remuneration	16/12/2021	01/01/2022 - 31/12/2024	01/01/2022 - 31/12/2022	01/01/2022 - 31/12/2024	100% total shareholder return. 100% liquidity coverage ratio. 100% CET1 indicator. 100% RoRAC indicator.	100% of target	4,363
2023-2025 Long-term remuneration	21/12/2022	01/01/2023 - 31/12/2025	01/01/2023 - 31/12/2023	01/01/2023 - 31/12/2025	—	—	—
2024-2026 Long-term remuneration	21/12/2023	01/01/2024 - 31/12/2026	01/01/2024 - 31/12/2024	01/01/2024 - 31/12/2026	—	—	—

As regards the staff expenses associated with share-based incentive schemes (see Note 1.3.15), the balancing entry for such expenses is recognised in equity in the case of stock options settled with shares (see consolidated statement of total changes in equity – share-based payments), while those settled with cash are recognised in the "Other liabilities" heading of the consolidated balance sheet.

Expenditure recognised in relation to incentive schemes and long-term remuneration granted to employees in 2024 and 2023 is shown below:

Thousand euro
	2024	2023
To be settled in shares	6,455	6,191
To be settled in cash	1,452	1,330
Total	7,907	7,521

Other administrative expenses

The composition of this heading in the consolidated income statement for the years 2024 and 2023 is as follows:

Thousand euro
	2024	2023
Property, plant and equipment	(62,247)	(68,908)
Information technology	(431,647)	(416,313)
Communication	(26,098)	(25,862)
Publicity	(104,847)	(96,682)
Subcontracted administrative services	(121,980)	(118,383)
Contributions and taxes	(122,080)	(116,542)
Technical reports	(69,279)	(26,948)
Security services and fund transfers	(17,509)	(17,429)
Entertainment expenses and staff travel expenses	(18,011)	(15,077)
Membership fees	(4,992)	(6,771)
Other expenses	(72,707)	(92,803)
Total	(1,051,397)	(1,001,718)

Audit firm fees

The fees received by KPMG Auditores, S.L. in the years ended 31 December 2024 and 2023 for audit and other services were as follows:

Thousand euro

	2024	2023
Audit services (*)	3,071	2,921
Of which: Audit of the Bank's annual and interim accounts	2,577	2,471
Of which: Audit of the annual accounts of foreign branches (**)	29	27
Of which: Audit of the annual accounts of subsidiaries	465	423
Audit-related services	366	292
Of which: Services that auditors are required to provide under applicable legislation	135	121
Other services	96	—
Of which: Other	96	—
Total	3,533	3,213

(*) Including fees corresponding to the year's audit, irrespective of the date on which that audit was completed. The annual financial statements of Banco Sabadell and the consolidated Banco Sabadell Group from 2020 to 2024 were audited by the external audit firm KPMG Auditores, S.L. (KPMG), holder of company tax number (CIF) B-78510153 and with registered office in Madrid, Torre de Cristal, Paseo de la Castellana, no. 259 C, 28046 Madrid, entered in the Madrid Companies Register in Volume 11,961, Folio 90, Section 8, Sheet M-188,007, entry 9 and entered in the Official Record of Statutory Auditors under number S0702.

KPMG Auditores, S.L. has neither given up nor been relieved of its responsibilities as auditor of Banco Sabadell and the consolidated Banco Sabadell Group at any time since 2020, nor up to the date on which these annual financial statements were signed off.

(**) Corresponding to the branch located in London.

The fees charged by KPMG Auditores, S.L. to Banco Sabadell and its companies linked by a control relationship for its provision of non-audit services (services other than those referred to in Article 5(1) of Regulation (EU) 537/2014 of the European Parliament and of the Council) in 2024 are no more than 70% of the average of the fees paid in the last three consecutive financial years for the statutory audit of the Bank, its Group and its controlled undertakings, as established in Article 4(2) of that European Regulation.

The fees received by other companies forming part of the KPMG network in the years ended 31 December 2024 and 2023 for audit and other services were as follows:

Thousand euro

	2024	2023
Audit services (*)	7,900	6,848
Of which: Audit of the annual accounts of foreign branches	393	341
Of which: Audit of the annual accounts of Group subsidiaries	7,507	6,507
Audit-related services	239	213
Of which: Services that auditors are required to provide under applicable legislation	61	—
Other services	366	474
Of which: Other	366	474
Total	8,505	7,535

(*) Including fees corresponding to the year's audit, irrespective of the date on which that audit was completed.

The main items included under "Audit-related services" correspond to fees related to reports that the auditors are required to produce under applicable regulations, the issuance of comfort letters and other assurance reports. Furthermore, "Other services" includes fees related to reviews of the Pillar 3 Disclosures reports for the years ended 31 December 2024 and 2023, and those related to assurance services in connection with the Non-Financial Disclosures Reports for 2024 and 2023.

Lastly, the Group engaged auditors other than KPMG to carry out the audits of foreign branches and other Group subsidiaries. Audit and other services provided to those branches and subsidiaries amounted to 65 thousand euros and 0 thousand euros in the year ended 31 December 2024, respectively (62 and 0 thousand euros in the year ended 31 December 2023).

All services provided by the auditors and companies forming part of their network comply with the requirements for statutory auditor independence set forth in the Spanish Audit Law and do not, in any case, include work that is incompatible with the account audit function.

Other information

The cost-to-income ratio as at 2024 year-end (staff and general expenses/gross margin) stood at 40.75% (42.59% in 2023).

Information about the Group's branches and offices is given below:

Number of branches and offices
	2024	2023
Branches and offices	1,350	1,420
Spain	1,139	1,178
Outside Spain	211	242

Note 34 – Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

Thousand euro
	Note	2024	2023
Financial assets at fair value through other comprehensive income		236	852
Debt securities	8	236	852
Other equity instruments		—	—
Financial assets at amortised cost	11	(592,054)	(825,245)
Debt securities		230	(40)
Loans and advances		(592,284)	(825,205)
Total		(591,818)	(824,393)

Note 35 – Impairment or (-) reversal of impairment on non-financial assets

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

Thousand euro
	Note	2024	2023
Property, plant and equipment for own use	15	(36,662)	(1,930)
Investment properties	15	(1,156)	(9,596)
Goodwill and other intangible assets		—	—
Inventories	17	(7,639)	(14,319)
Total		(45,457)	(25,845)

The total allowance for the impairment of investment properties in 2024 and 2023 was calculated based on Level 2 valuations (see Note 6). The fair value of impaired assets amounted to 152,019 thousand euros and 225,641 thousand euros as at 31 December 2024 and 2023, respectively.

Of the total inventory impairment allowances for 2024 and 2023, 2,676 thousand euros and 1,295 thousand euros were allocated based on Level 2 valuations, respectively, and 4,963 thousand euros and 13,024 thousand euros based on Level 3 valuations, respectively. The fair value of impaired assets amounted to 43,273 thousand euros and 61,561 thousand euros as at 2024 and 2023 year-end, respectively.

Note 36 – Gains or (-) losses on derecognition of non-financial assets, net

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

Thousand euro
	Note	2024	2023
Property, plant and equipment		(5,828)	(657)
Investment properties		3,426	4,274
Intangible assets	16	(21,292)	(50,750)
Interests		1,446	7,799
Other items		(5)	(10)
Total		(22,253)	(39,344)

The sale of tangible assets under finance leases in which the Group acted as lessor did not have a material impact on the 2024 and 2023 consolidated income statements.

Note 37 – Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations

The composition of this heading of the consolidated income statement for the years ended 31 December 2024 and 2023 is as follows:

Thousand euro
	Note	2024	2023
Property, plant and equipment for own use and foreclosed		(36,111)	(58,067)
Gains/losses on sales		(5,131)	(23,755)
Impairment/Reversal	13	(30,980)	(34,312)
Investment properties		—	—
Interests (*)		—	396
Other items		(275)	(2,284)
Total		(36,386)	(59,955)

(*) See Schedule I - Exclusions from the scope of consolidation.

In 2024 and 2023 the heading "Plant and equipment for own use and foreclosed - Impairment/reversal" mainly includes foreclosed properties in the process of being sold. Furthermore, in 2023, this heading included the impact of the recognition at fair value of tangible assets to be disposed of as part of the sale of the merchant acquiring business (see Note 13).

The impairment of non-current assets held for sale excludes income from the increase in fair value less selling costs.

The total allowance for the impairment of non-current assets held for sale in 2024 and 2023 was calculated based on Level 2 valuations (see Note 6). The fair value of impaired assets amounted to 500,921 thousand euros and 554,978 thousand euros as at 2024 and 2023 year-end, respectively.

Note 38 – Segment reporting

Segmentation criteria

This section gives information regarding earnings and other indicators of the Group's business units.

In 2024, the criteria that Banco Sabadell Group uses to report on results for each segment are those established in 2023, specifically:

• Three geographical areas: Banking Business in Spain, United Kingdom and Mexico. Banking Business Spain includes foreign branches and representative offices.
• Each business unit is allocated capital equivalent to 13% of its risk-weighted assets in 2024 (12% in 2023), assigning all deductions corresponding to each business unit, and the surplus of own funds is allocated to Banking Business Spain.

In terms of the other criteria applied, segment information is first structured with a breakdown by geographical area and then broken down according to the customers at which each segment is aimed.

The information presented herein is based on the standalone accounting records of each Group company, after all consolidation disposals and adjustments have been made.

Each business unit bears its own direct costs, calculated on the basis of general accounting records.

Details of profit attributable to the Group and other key figures of each business unit for the years 2024 and 2023 are shown in the table below, along with a reconciliation of the totals shown in the table with those shown in the consolidated accounts:

Million euro
	2024 (*)
	Banking Business	Banking Business	Banking	Total Group
	Spain	UK	Business Mexico
Net interest income	3,652	1,163	206	5,021
Fees and commissions, net	1,231	107	18	1,357
Core revenue	4,883	1,270	224	6,378
Profit or loss on financial operations and exchange differences	36	39	13	87
Equity-accounted income and dividends	166	—	—	166
Other operating income/expense	(249)	(23)	(21)	(294)
Gross income	4,836	1,286	216	6,337
Operating expenses and depreciation and amortisation	(2,071)	(887)	(126)	(3,084)
Pre-provisions income	2,765	399	90	3,254
Provisions and impairments	(652)	(37)	(24)	(714)
Capital gains on asset sales and other revenue	(14)	(8)	(4)	(26)
Profit/(loss) before tax	2,098	353	62	2,514
Corporation tax	(579)	(100)	(6)	(685)
Profit or loss attributed to minority interests	2	—	—	2
Profit attributable to the Group	1,517	253	57	1,827
ROTE (net return on tangible equity)	15.9 %	12.0 %	9.7 %	14.9 %
Cost-to-income (general administrative expenses / gross income)	35.1 %	59.5 %	51.2 %	40.8 %
NPL ratio	3.3 %	1.5 %	2.8 %	2.8 %
Stage 3 coverage ratio (**)	66.3 %	34.3 %	59.5 %	61.7 %
Employees	13,525	4,729	515	18,769
Domestic and foreign branches and offices	1,152	186	12	1,350

(*) Exchange rates applied in the income statement: EUR/GBP 0.8463 (average), EUR/MXN 19.7732 (average), EUR/USD 1.0838 (average) and EUR/MAD 10.5368 (average).

(**) Considering total provisions for losses on transactions in stage 3.

Million euro

		2024 (*)
	Banking Business Spain	Banking Business UK	Banking Business Mexico	Total Group
Assets	177,348	55,604	6,646	239,598
Gross performing loans to customers	109,291	43,380	4,242	156,913
Non-performing real estate assets, net	497	—	—	497
Liabilities and equity	177,348	55,604	6,646	239,598
On-balance sheet customer funds	124,235	42,123	3,199	169,557
Wholesale funding in capital markets	21,135	5,859	—	26,994
Allocated own funds	12,161	2,543	686	15,389
Off-balance sheet customer funds	46,171	—	—	46,171

(*) Exchange rates used in the balance sheet: EUR/GBP 0.8292, EUR/MXN 21.5504, EUR/USD 1.0389 and EUR/MAD 10.5104.

	2023 (*)
	Banking Business Spain	Banking Business UK	Banking Business Mexico	Total Group
Net interest income	3,353	1,174	196	4,723
Fees and commissions, net	1,247	124	15	1,386
Core revenue	4,601	1,298	211	6,109
Profit or loss on financial operations and exchange differences	45	16	8	68
Equity-accounted income and dividends	131	—	—	131
Other operating income/expense	(404)	(23)	(20)	(447)
Gross income	4,372	1,291	198	5,862
Operating expenses and depreciation and amortisation	(1,965)	(941)	(108)	(3,015)
Pre-provisions income	2,407	350	90	2,847
Provisions and impairments	(816)	(75)	(19)	(910)
Capital gains on asset sales and other revenue	(27)	—	(19)	(46)
Profit/(loss) before tax	1,564	274	53	1,891
Corporation tax	(469)	(80)	(9)	(557)
Profit or loss attributed to minority interests	1	—	—	1
Profit attributable to the Group	1,093	195	44	1,332
ROTE (net return on tangible equity)	12.0 %	10.0 %	8.9 %	11.5 %
Cost-to-income (general administrative expenses / gross income)	37.2 %	62.1 %	45.7 %	42.6 %
NPL ratio	4.3 %	1.5 %	2.4 %	3.5 %
Stage 3 coverage ratio (**)	59.9 %	41.8 %	74.3 %	58.3 %
Employees	13,455	5,426	435	19,316
Domestic and foreign branches and offices	1,194	211	15	1,420

(*) Exchange rates applied in the income statement: EUR/GBP 0.8532 (average), EUR/MXN 21.0739 (average), EUR/USD 1.0538 (average) and EUR/MAD 11.1232 (average).

(**) Considering total provisions for losses on transactions in stage 3.

Million euro

		2023 (*)
	Banking Business Spain	Banking Business UK	Banking Business Mexico	Total Group
Assets	173,648	54,855	6,670	235,173
Gross performing loans to customers	103,830	41,381	4,587	149,798
Non-performing real estate assets, net	586	—	—	586
Liabilities and equity	173,648	54,855	6,670	221,294
On-balance sheet customer funds	117,820	39,864	3,205	160,888
Wholesale funding in capital markets	19,949	4,545	—	24,494
Allocated own funds	10,880	2,368	631	13,879
Off-balance sheet customer funds	40,561	—	—	40,561

(*) Exchange rates used in the balance sheet: EUR/GBP 0.8869, EUR/MXN 20.856, EUR/USD 1.066 and EUR/MAD 11.1558.

The Group's average total assets as at 31 December 2024 amounted to 242,144,674 thousand euros (245,173,480 thousand euros as at 31 December 2023).

The types of products and services from which revenue is derived are described below for each business unit:

• Banking Business Spain: groups together the Retail Banking, Business Banking and Corporate Banking business units, with individuals and businesses managed under the same branch network:
  • Retail Banking: offers financial products and services to individuals for personal use. These include investment products and medium- and long-term finance, such as consumer loans, mortgages, leasing and rental services, as well as other short-term finance. Funds come mainly from customers' term and demand deposits, savings insurance, mutual funds and pension plans. The main services also include payment methods such as cards and various kinds of insurance products.
  • Business Banking: offers financial products and services to companies and self-employed persons. These include investment and financing products, such as working capital products, revolving loans and medium- and long-term finance. It also offers custom structured finance and capital market solutions, as well as specialised advice for businesses. Funds mainly come from customers' term and demand deposits and mutual funds. The main services also include collection/payment solutions such as cards and PoS terminals, as well as import and export services. It also includes Private Banking, which offers personalised expert advice, backed by specialised and high-value product capabilities for our customers.
  • Corporate Banking: offers specialised lending services together with a comprehensive offering of solutions, ranging from transaction banking services to more complex and tailored solutions relating to the fields of finance and cash management, as well as import and export activities, among others.
• Banking business UK: the TSB franchise covers business conducted in the United Kingdom, which includes current and savings accounts, loans, credit cards and mortgages.
• Banking Business Mexico: offers banking and financial services for corporate banking and commercial banking.

Details of income from ordinary activities and the pre-tax profit/(loss) generated by each business unit are set out below for the years 2024 and 2023:

Thousand euro
SEGMENTS	Consolidated
	Income from ordinary activities (*)		Profit/(loss) before tax
	2024	2023	2024	2023
Banking Business Spain	7,750,614	7,395,289	2,098,083	1,563,668
Banking Business UK	2,817,315	2,486,036	353,332	274,397
Banking Business Mexico	730,836	717,713	62,483	52,713
Total	11,298,765	10,599,038	2,513,898	1,890,778

(*) Includes the following headings from the consolidated income statements: "Interest income", "Dividend income", "Fee and commission income", "Net profit or net loss on financial operations" and "Other operating income".

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The table below shows the deposits, net interest income and net fees and commissions generated by each business unit as a percentage of the total for 2024 and 2023:

%

	2024
		Breakdown of net interest income and net fees and commissions
	Customer loans		Customer deposits		Income from services (*)
	% of average		% of average		% of total
SEGMENTS	balance	% of total yield	balance	% of total cost	balance
Banking Business Spain	69.1 %	66.1 %	72.7 %	61.3 %	90.7 %
Banking Business UK	28.0 %	26.6 %	25.4 %	30.4 %	7.9 %
Banking Business Mexico	2.9 %	7.3 %	2.0 %	8.3 %	1.4 %
Total	100 %	100 %	100 %	100 %	100 %

(*) Segment percentage of total net fees and commissions.

%

	2023 Breakdown of net interest income and net fees and commissions
	Customer loans		Customer deposits		Income from services (*)
	% of average balance	% of total yield	% of average balance	% of total cost	% of total balance
SEGMENTS
Banking Business Spain	69.3 %	65.5 %	73.2 %	61.1 %	91.7 %
Banking Business UK	27.6 %	26.6 %	24.8 %	28.7 %	7.4 %
Banking Business Mexico	3.1 %	7.9 %	2.0 %	10.2 %	0.9 %
Total	100 %	100 %	100 %	100 %	100 %

(*) Segment percentage of total net fees and commissions.

Furthermore, a breakdown by geographical area of the "Interest income" heading of the 2024 and 2023 income statements is shown below:

	Breakdown of interest income by geographical area
Geographical area	Standalone		Consolidated
	2024	2023	2024	2023
Domestic market	6,219,708	5,212,561	5,976,748	5,040,658
International market	435,023	619,846	3,736,644	3,618,098
European Union	59,571	92,376	59,571	92,376
Eurozone	59,571	92,376	59,571	92,376
Non-Eurozone	—	—	—	—
Other	375,452	527,470	3,677,073	3,525,722
Total	6,654,731	5,832,407	9,713,392	8,658,756

Section 4 of the consolidated Directors' Report gives a more detailed assessment of each of these business units.

Note 39 – Tax situation (income tax relating to continuing operations)

Consolidated tax group

Banco de Sabadell, S.A. is the parent company of a consolidated tax group for corporation tax purposes, in Spain, comprising, as subsidiaries, all the Spanish companies in which the Bank holds an interest that meet the requirements of the Spanish Corporation Tax Law.

The other companies in the accounting group, both those that are Spanish and those not resident in Spain, are taxed in accordance with the tax regulations applicable to them.

Reconciliation

The reconciliation between the Group's corporation tax expense calculated by applying the general tax rate and the expense recognised for that corporation tax in the consolidated income statements is as follows:

	2024	2023
Profit or loss before tax	2,513,898	1,890,778
Corporation tax, applying national tax rate (30%)	(754,170)	(567,234)
Reconciliation:
Gains/(losses) on sale of equity instruments (exempt)	5,629	2,049
Remuneration of preferred securities	29,447	34,617
Profit/(loss) of entities accounted for using the equity method	46,473	37,893
Difference in effective tax rate on companies/permanent establishments outside Spain (*)	30,993	22,678
Non-deductible expenses/Deductions generated (**)	(3,071)	(66,157)
Other	(40,573)	(21,021)

(Tax expense or (-) income related to profit from continuing operations) (685,272) (557,175)

(*) Calculated applying the difference between the current tax rate for the Group in Spain (30%) and the effective tax rate applied to the Group's profit/(loss) in each jurisdiction.

(**) Includes 61 million euros corresponding to the capitalisation of deductions for research & development and technological innovation activities, generated in previous years, corresponding to projects that, in all cases, are backed up by a favourable report from the Ministry of Economy and Competitiveness in accordance with recent case law in the field. It is expected that these deductions will be applied by the Group.

The effective tax rate, calculated as tax expenses related to profit divided by profit or loss before tax, came to 27.26% and 29.47% in 2024 and 2023, respectively.

Deferred tax assets and liabilities

Under current tax and accounting regulations, certain timing differences should be taken into account when quantifying the relevant tax expense related to profit from continuing operations.

In 2013, Spain made a provision (Royal Decree-Law 14/2013) for tax assets generated by allowances for the impairment of loans and other assets arising from the potential insolvency of debtors not related to the relevant taxable person, as well as those corresponding to contributions or provisions in respect of social welfare schemes and, where appropriate, early retirement schemes, to be afforded the status of assets guaranteed by the Spanish State (hereinafter, "monetisable tax assets").

Monetisable tax assets can be converted into credit enforceable before the Spanish Tax Authority in cases where the taxable person incurs accounting losses or the Institution is liquidated or legally declared insolvent. Similarly, they can be exchanged for public debt securities, once the 18-year term has elapsed, calculated from the last day of the tax period in which these assets were recognised in the accounting records. To retain the State guarantee, and to keep their status as monetisable tax assets, deferred tax assets generated up to 2016 are subject to an annual capital contribution of 1.5% of the deferred tax assets that meet the legal requirements.

Movements of deferred tax assets and liabilities during 2024 and 2023 are shown below:

Thousand euro
Deferred tax assets	Monetisable	Non-monetisable	Tax credits for losses carried forward	Deductions not applied	Total
Balances as at 31 December 2022	4,995,878	1,242,915	390,689	15,025	6,644,507
(Debit) or credit recorded in the income statement	(93,090)	53,010	(104,319)	(14,999)	(159,398)
(Debit) or credit recorded in equity	—	(29,777)	—	—	(29,777)
Exchange differences and other movements	(159,445)	50,532	39,112	—	(69,802)
Balances as at 31 December 2023	4,743,343	1,316,680	325,482	26	6,385,531
(Debit) or credit recorded in the income statement	(146,675)	(54,865)	(119,850)	(1)	(321,390)
(Debit) or credit recorded in equity	—	28,761	—	—	28,761
Exchange differences and other movements	(152,211)	(82,663)	41,943	(25)	(192,956)
Balances as at 31 December 2024	4,444,457	1,207,913	247,575	—	5,899,945

Thousand euro
Deferred tax liabilities	Total
Balances as at 31 December 2022	113,717
(Debit) or credit recorded in the income statement	(490)
(Debit) or credit recorded in equity	(502)
Exchange differences and other movements	2,245
Balances as at 31 December 2023	114,970
(Debit) or credit recorded in the income statement	5,009
(Debit) or credit recorded in equity	—
Exchange differences and other movements	757
Balances as at 31 December 2024	120,736

The sources of the deferred tax assets and liabilities recognised in the consolidated balance sheets as at 31 December 2024 and 2023 are as follows:

Thousand euro
Deferred tax assets	2024	2023
Monetisable	4,444,457	4,743,343
Due to credit impairment	3,063,266	3,369,993
Due to real estate asset impairment	1,257,371	1,248,285
Due to pension funds	123,820	125,065
Non-monetisable	1,207,913	1,316,680
Tax credits for losses carried forward	247,575	325,482
Deductions not applied	—	26
Total	5,899,945	6,385,531
Deferred tax liabilities	2024	2023
Property restatements	50,671	53,092
Adjustments to value of wholesale debt issuances arising in business combinations	1,295	4,020
Other financial asset value adjustments	2,501	1,657
Other	66,269	56,201
Total	120,736	114,970

The breakdown by country of deferred tax assets and liabilities is as follows:

Thousand euro

Country	2024		2023
	Deferred tax assets	Deferred tax liabilities	Deferred tax assets	Deferred tax liabilities
Spain	5,730,552	110,402	6,174,220	104,364
United Kingdom	14,415	9,862	58,037	10,606
United States	72,512	472	63,492	—
Mexico	77,473	—	82,608	—
Other	4,993	—	7,174	—
Total	5,899,945	120,736	6,385,531	114,970

As indicated in Note 1.3.20, according to the information available as at year-end and the projections taken from the Group's business plan for the coming years, the Group estimates that it will be able to generate sufficient taxable income to offset tax loss carry-forwards within a period of three years and non-monetisable tax assets, where these can be deducted according to current tax regulations, within a period of 10 years.

In addition, the Group performs a sensitivity analysis of the most significant variables used in the deferred tax asset recoverability analysis, taking into consideration reasonable changes to the key assumptions on which the projected results of each entity or tax group are based and the estimated reversal of timing differences. With respect to Spain, the variables considered are those used in the sensitivity analysis of the calculation of the recoverable amount of goodwill (see Note 16). The conclusions drawn from that analysis are not significantly different from those reached without stressing the significant variables.

The Constitutional Court declared, in its ruling 11/2024 dated 18 January 2024, published in the Official State Gazette (Boletín Oficial del Estado) on 20 February 2024, that certain measures related to corporation tax introduced by Royal Decree-Law 3/2016 of 2 December were unconstitutional. Those measures were reintroduced in Law 7/2024 of 20 December, which is applicable to the financial year 2024.

As at 31 December 2024, the Group had deferred tax assets not recognised in the balance sheet for unused tax losses in the amount of 420,324 thousand euros and deductions amounting to 10,887 thousand euros.

Monetisable tax assets are guaranteed by the State. Therefore, their recoverability does not depend on the generation of future tax benefits.

Years subject to tax inspection

As at 31 December 2024, corporation tax for the consolidated tax group in Spain was open to review for 2020 and subsequent years. In relation to Value Added Tax (VAT) corresponding to entities forming part of the VAT group in Spain, 2020 and subsequent periods were open to review.

The review of all taxes not verified and not required in accordance with the corresponding tax regulations is still pending for other Group entities that are not taxed within the consolidated tax group or the VAT group in Spain.

Proceedings

In January 2022, the State Agency for Tax Administration (Administración Estatal de Administración Tributaria, or AEAT) gave notice to Banco Sabadell, as the parent company of the consolidated tax group, of the commencement of verification and investigation proceedings in relation to the main taxes affecting the Group and three of its subsidiaries⁵ . Specifically, the items and periods listed below:

• Corporation Tax for the years 2015 to 2019.
• Capital contribution associated with the conversion of deferred tax assets into credit eligible for the Spanish Tax Authority (Capital Contribution) for the years 2016 to 2019.
• Value Added Tax (VAT) for the years 2018 and 2019.
• Withholdings and payments on account (employment income, income from movable capital) for the years 2018 and 2019.

⁵ Sabadell Digital, S.A.U., Sabadell Real Estate Development, S.L.U., and Tenedora de Inversiones y Participaciones, S.L.

– Tax on deposits of credit institutions (Impuesto sobre Depósitos de las Entidades de Crédito, IDEC) for the years 2017 to 2019.

Documents related to those proceedings were signed on 30 November 2023 and details of them can be found in Note 39 "Tax situation" of the consolidated annual financial statements for 2023. The proceedings were completed in 2024. At the end of the current year, matters in dispute and brought before the Central Tax Appeal Board (Tribunal Económico-administrativo Central, or TEAC) in relation to corporation tax (deduction for technological innovation) and VAT (sectoral issues), remain pending resolution, as explained in the following section ("Ongoing disputes").

In January 2024, Banco Sabadell, as the parent company of the consolidated tax group, was notified of the commencement of verification and investigation proceedings in relation to the temporary levy on credit institutions and financial credit establishments, paid in 2023. A Statement of Disagreement, disputing the tax assessment, was signed on 30 September 2024, in response to the corresponding allegations submitted. As at year-end, the tax clearance certificate remains pending release.

In addition, on 4 February 2025, the State Tax Agency (AEAT) gave notice of the commencement of verification and investigation proceedings in relation to Banco Sabadell, as parent company of the VAT group, in its capacity as legal representative of that group, and also in relation to three of its subsidiaries⁶ , in connection with VAT corresponding to the financial years 2021, 2022 and 2023.

At the end of 2024, the Mexican tax authority (Servicio de Administración Tributaria, or SAT) gave notice to the subsidiaries Banco Sabadell, S.A. Institución de Banca Múltiple and SabCapital, S.A. de C.V. SOFOM E.R. of the commencement of verification proceedings in connection with income tax and value added tax corresponding to the year 2019, both processes of which are currently in the document submission phase.

Ongoing disputes

The main tax-related disputes that were ongoing as at 31 December 2024 are set out below:

• Administrative-financial claims brought before the TEAC in respect of corporation tax settlement agreements for the years 2015 to 2017 and 2018 to 2019, specifically related to the deduction for technological innovation, settled on the basis of application of the criterion established by Spain's National Court (Audiencia Nacional, a division of the Supreme Court) in its rulings of 23 November and 9 December 2022.
• Administrative-financial claim brought before the TEAC regarding the VAT settlement agreement for the years 2018 to 2019, in relation to certain sectoral issues.
• Appeal for judicial review before Spain's National Court in relation to Order HFP/94/2023 of 2 February approving, among others, Model 797 "Temporary levy of credit institutions and financial credit establishments. Declaration of payment made" and Model 798 "Temporary levy of credit institutions and financial credit establishments. Advance payment".

In addition, requests for rectification have been submitted in respect of both tax authority Model 798 "Advance payment" and Model 797 "Declaration of payment made" in relation to the temporary levy on credit institutions and financial credit establishments. These rectifications are currently at the administrative stage, in the process of administrative-financial proceedings or now form part of the verification proceedings referred to in the preceding point.

The Group has made suitable provisions for any contingencies that it is thought could arise in relation to the ongoing proceedings and disputes described in this Note.

In relation to items for which the statute of limitations is unexpired, due to potential differences in the interpretation of tax regulations, the results of the tax authority inspections for the years subject to review may give rise to contingent tax liabilities, which it is not possible to quantify objectively. However, the Group considers that the possibility of such liabilities materialising is remote and, if they did materialise, the resulting tax charge would not have any significant impact on these consolidated annual financial statements.

⁶ Sabadell Digital, S.A.U., Sabadell Real Estate Development, S.L.U., and Tenedora de Inversiones y Participaciones, S.L.

International tax reform - Pillar Two rules

On 21 December 2024, Law 7/2024 of 20 December was published which, inter alia, transposes into Spanish law, Directive (EU) 2022/2523 of 14 December 2022, establishing a top-up tax ("top-up tax") to ensure a global minimum level of taxation for multinational enterprise groups and large-scale domestic groups (referred to as the "Pillar Two rule"), applicable with retroactive effect to each financial year commencing after 31 December 2023. It should also be noted that, of the other jurisdictions that are significant for the Group (United Kingdom and Mexico), as at 31 December 2024, only the United Kingdom has approved domestic regulations in relation to Pillar Two; those regulations entered into force on 31 December 2023 and are applicable to each year beginning after that date.

The Group, in its capacity as a large-scale multinational group, is subject to that top-up tax.

The Group has applied the mandatory temporary exception provided in IAS 12 in relation to the accounting for deferred taxes arising from jurisdictions implementing the global tax rules to ensure consistency in the financial statements while easing into the implementation of the rules.

In addition, based on the available information, an analysis was carried out considering, when applicable, the safe harbours provided for in the Fourth Transitional Provision of the Pillar Two rule, concluding that the impact of Pillar Two for the Group is not significant.

Tax on net interest and commission income of certain financial institutions

Final Provision Nine of Law 7/2024 of 20 December established a tax on the net interest and commission income of certain financial institutions (Impuesto sobre el Margen de Intereses y Comisiones, or IMIC). This tax, which is direct and progressive, is levied on the net interest and commission income arising from the activity in Spain of credit institutions, financial credit establishments and branches of foreign credit institutions obtained, respectively, in the tax periods beginning in the years 2024, 2025 and 2026. In terms of the tax rate, this is established on a scale which, after reducing the tax base by 100 million euros, includes five brackets: 1%, 3.5%, 4.8%, 6% and 7% (maximum rate applicable to the taxable base above 5 billion euros).

Royal Decree-Law 2024 of 23 December came into force on 25 December 2024 and amended the accrual of the tax, establishing that it shall accrue on the last day of the calendar month immediately following the end of the tax period for entities subject to payment of that tax as at the aforesaid date. That Royal Decree-Law was repealed, by agreement of the Spanish Parliament's lower house of representatives (Congreso de los Diputados), on 22 January 2025.

The Group has not recorded any impact in its consolidated financial statements as at the end of 2024 as a result of the establishment of the above-mentioned tax, having estimated net tax payable of around 140 million euros for the first tax year in question.

Note 40 – Related party transactions

In accordance with the provisions of Chapter VII bis. Related Party Transactions of the Capital Companies Act, introduced by Law 5/2021 of 12 April, amending the restated text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010 of 2 July, and other financial regulations, with regard to the promotion of long-term shareholder involvement in listed companies, there are no transactions with officers and directors of the company that could be considered material, other than those considered to be "related party transactions" in accordance with Article 529 vicies of the Capital Companies Act, carried out following the corresponding approval procedure and, where applicable, reported in accordance with Articles 529 unvicies et seq. of the aforesaid Capital Companies Act. Those that did take place were performed in the normal course of the company's business or were performed on an arm's-length basis or under the terms generally applicable to any employee. There is no record of any transactions being performed other than on an arm's-length basis with persons or entities related to directors or senior managers.

On 24 April 2024, the Board of Directors of Banco Sabadell approved, following a favourable report from the Board Audit and Control Committee, a related-party transaction with Acerinox, S.A. involving a bilateral loan of 150 million euros, granted to Acerinox, S.A., with a 3.75% interest rate, a two-year grace period and semiannual straight-line repayment over five years, which was formally arranged on 27 June 2024. It is deemed a related party transaction as Banco Sabadell directors Laura González Molero and George Donald Johnston III are Independent Directors of Acerinox, S.A. Ms Molero is also member of its Audit Committee and Chair of its Appointments, Remuneration and Corporate Governance Committee, while Mr Johnston is member of its Executive Committee.

As the amount of this transaction, together with three other transactions carried out in the last twelve months, was more than 2.5% of the turnover recorded in Banco Sabadell's consolidated annual financial statements for 2023, an 'Other Relevant Information' disclosure, alongside the corresponding report from the Board Audit and Control Committee, was published on the CNMV's website on 27 June 2024 and 12 July 2024, with register numbers 29,404 and 29,678, and on Banco Sabadell's corporate website (www.grupbancsabadell.com), in accordance with that set forth in Article 529 unvicies of the Capital Companies Act. Furthermore, information was provided in the Other Relevant Information disclosure referred to above and on Banco Sabadell's website (www.grupbancsabadell.com) regarding the three abovementioned transactions, two of which were approved by the Board of Directors on 24 April 2024, following a favourable report from the Board Audit and Control Committee (also attached to that same Other Relevant Information disclosure), while the third was approved by Compliance in its decision of 28 September 2023 as a related-party transaction, as per the powers conferred by the Board of Directors of Banco Sabadell on 1 July 2021. These three transactions consisted, respectively, of the renewal of a multi-company credit policy (co-shared by Acerinox, S.A.) for 80 million euros, at 3-month Euribor + 0.90% and maturing after 3 years; the renewal of a multi-company credit policy (co-shared by Acerinox, S.A.) for 15 million US dollars, at 3 month SOFR + 1% and maturing after 3 years; and the renewal of a multi-company credit policy (available equally to Acerinox, S.A. and Acerinox Europa, S.A.U.) for 20 million US dollars, at 3-month SOFR + 1.10% and maturing after 1 year.

Details of the most significant balances held with related parties as at 31 December 2024 and 2023, as well as the amount recorded on the consolidated income statements for 2024 and 2023 for related party transactions, are shown below:

Thousand euro
	2024
	Joint control or signif. influence (in B.Sab)	Associates	Key personnel	Other related parties (*)	TOTAL
Assets:
Customer lending and other financial assets	—	107,764	3,967	1,010,009	1,121,740
Liabilities:
Customer deposits and other financial liabilities	—	681,466	5,849	297,475	984,790
Off-balance sheet exposures:
Financial guarantees given	—	319	7	22,598	22,924
Loan commitments given	—	14,611	373	334,042	349,026
Other commitments given	—	6,491	—	72,745	79,236
Income statement:
Interest receivable and similar income	—	4,447	50	24,157	28,654
Interest payable and similar charges	—	(17,013)	(86)	(6,411)	(23,510)
Return on capital instruments	—	—	—	—	—
Fees and commissions, net	—	111,353	15	5,754	117,122
Other operating income and expenses	—	5,878	—	7	5,885

(*) Includes employee pension plans.

	2023
	Joint control or signif. influence (in B.Sab)	Associates	Key personnel	Other related parties (*)	TOTAL
Assets:
Customer lending and other financial assets	—	99,652	3,757	829,620	933,029
Liabilities:
Customer deposits and other financial liabilities	—	463,292	5,452	218,477	687,221
Off-balance sheet exposures:
Financial guarantees given	—	294	—	29,136	29,430
Loan commitments given	—	54	378	261,702	262,134
Other commitments given	—	6,491	—	84,726	91,217
Income statement:
Interest receivable and similar income	—	4,170	50	18,110	22,330
Interest payable and similar charges	—	(4,010)	(75)	(915)	(5,000)
Return on capital instruments	—				—
Fees and commissions, net	—	106,253	13	1,452	107,718
Other operating income and expenses	—	5,655	3	4	5,662

(*) Includes employee pension plans.

Total risk transactions granted by the Bank and consolidated companies to all Directors of the parent company amounted to 782 thousand euros as at 31 December 2024, of which 649 thousand euros corresponded to loans and advances and 133 thousand euros to loan commitments given (875 thousand euros as at 31 December 2023, consisting of 738 thousand euros in loans and advances and 137 thousand euros in loan commitments given). With regard to Senior Management, risk transactions granted by the Bank and consolidated companies amounted to 3,558 thousand euros as at 31 December 2024, of which 3,318 thousand euros corresponded to loans and advances and 240 thousand euros to loan commitments given (3,019 thousand euros in loans and advances and 241 thousand euros in loan commitments given as at 31 December 2023). These transactions form part of the ordinary business of the Bank and are carried out under normal market conditions.

With regard to liabilities, these amounted to 4,088 thousand euros for Directors of the parent company (3,751 thousand euros as at 31 December 2023) and 1,761 thousand euros for Senior Management as at 31 December 2024 (1,700 thousand euros as at 31 December 2023).

Note 41 – Remuneration of members of the Board of Directors and Senior Management and their respective balances

The Director Remuneration Policy for the years 2024, 2025 and 2026 was approved by the shareholders at the Annual General Meeting of 23 March 2023 and complies with European directives and regulations and with prevailing legislation, particularly Spanish Law 10/2014 of 26 June on the regulation, supervision and solvency of credit institutions, Royal Decree 84/2015 of 13 February implementing the aforesaid Law and Bank of Spain Circular 2/2016 of 2 February, addressed to credit institutions, on supervision and solvency, which completes the transposition into Spanish law of Directive 2013/36/EU and Regulation (EU) No 575/2013, as well as EBA Guidelines on internal governance (EBA/GL/2021/05) of 2 July 2021, EBA Guidelines (EBA/GL/2021/04) of 2 July 2021 on sound remuneration policies under Directive 2013/36/EU, and Commission Delegated Regulation (EU) 2021/923.

For further details on Directors' remuneration, see the Annual Report on Director Remuneration for 2024. Additionally, for further details on Senior Management remuneration, see the Annual Corporate Governance Report for 2024. These documents are included for reference as part of the consolidated Directors' Report.

Remuneration of members of the Board of Directors

Non-Executive Directors

The following table shows, for the years ended 31 December 2024 and 2023, the remuneration paid to Non-Executive Directors for services provided by them in that capacity:

Thousand euro

Non-executive members of the Board of Directors	Director category	Remuneration for Board membership	Remuneration for Board Committee membership	Remuneration for positions held in Group companies	Total 2024	Total 2023
Josep Oliu Creus	Non-Executive Chair	1,625	—	—	1,625	1,600
Pedro Fontana García	Independent Deputy Chair	232	158	—	390	342
Anthony Frank Elliott Ball (1)	Independent Director	—	—	—	—	24
Aurora Catá Sala	Independent Director	125	65	—	190	173
Ana Colonques García-Planas (2)	Independent Director	82	41	—	123	—
Luis Deulofeu Fuguet	Independent Director	125	75	30	230	205
María José García Beato	Other External Director	125	70	—	195	170
Mireya Giné Torrens	Independent Director	125	77	28	230	195
Laura González Molero	Independent Director	125	70	—	195	145
George Donald Johnston III	Lead Independent Director	147	97	—	244	206
David Martínez Guzmán	Proprietary Director	125	—	—	125	95
José Manuel Martínez Martínez (3)	Independent Director	32	20	—	52	170
Alicia Reyes Revuelta	Independent Director	125	75	—	200	170
Manuel Valls Morató	Independent Director	125	110	—	235	178
Pedro Viñolas Serra (4)	Independent Director	125	80	—	205	90
Total		3,243	938	58	4,239	3,763

(1) Resigned from his position as Director, effective as from the date of the Ordinary Annual General Meeting of 2023, which took place on 23 March 2023.

(2) On 10 April 2024, the shareholders at the Annual General Meeting approved her appointment as member of the Board of Directors, in the capacity of Independent Director. She accepted the position on 27 May 2024.

(3) Resigned from his position as Director, effective as from the date of the Ordinary Annual General Meeting of 2024, which took place on 10 April 2024.

(4) On 23 March 2023 the shareholders at the Annual General Meeting approved his appointment as a member of the Board of Directors, in the capacity of Independent Director and he accepted the position on 22 June 2023.

Based on the revised remuneration scheme and remuneration amounts of the Board and its Board Committees, and in accordance with the powers conferred by the Banco Sabadell Director Remuneration Policy to the Board of Directors, on 31 January 2024 the Board approved an update to the remuneration amounts envisaged for 2024. That update was described in detail in the 2023 Annual Report on Director Remuneration.

No contributions were made to meet pension commitments for Non-Executive Directors in 2024 and 2023. The amount of funds accumulated in workplace retirement planning schemes for Non-Executive Directors as at 31 December 2024 was 9,168 thousand euros (7,650 thousand euros as at 31 December 2023).

Executive Directors

Details of the remuneration paid to Executive Directors for the years 2024 and 2023 are set out below:

Executive members of the Board of Directors	Director category		Fixed components	Variable components		Contributions to workplace	Total	Total 2023
		Wage	Remuneration for Board membership	Short-term variable remuneration	Long-term variable remuneration	retirement planning systems	2024
César González-Bueno Mayer	Sabadell Group CEO	1,693	125	1,096	698		301 3,913 3,631
David Vegara Figueras	Executive director	623	125	133	133		110 1,124 1,025
Total		2,316	250	1,229	831		411 5,037 4,656

In accordance with the policy in force approved by the shareholders at the Annual General Meeting, the remuneration of Executive Directors for services provided by them in that capacity consists of a fixed remuneration component and a variable remuneration component comprised of two elements:

Variable remuneration

Short-term variable remuneration

The short-term variable remuneration of Executive Directors is determined taking into account the performance in the financial year measured through targets aligned with the risk taken. The Executive Directors have Group targets assigned to them, which include both risk management and control metrics and solvency and capital metrics. They may also have strategic targets with weights assigned to each indicator, and a scale of achievement.

Long-term variable remuneration

The Executive Directors have long-term remuneration, which is granted annually in cycles based on the achievement of annual and multi-year (three-year) targets, with a corresponding reference amount established at the beginning of each cycle. On completion of the first year of the cycle, the remuneration is adjusted during the first quarter of the subsequent year, according to (i) the level of achievement of the short-term variable remuneration targets corresponding to the first cycle, and (ii) any ex ante adjustments.

The payment of the adjusted reference amount will depend on the level of achievement of the multi-year targets described in the corresponding Annual Report on Director Remuneration. The amount ultimately paid out will be, at most, the adjusted reference amount, which shall not be increased in any case.

Both short-term and long-term variable remuneration will be subject to the criteria concerning deferral and payment in capital instruments described in the Director Remuneration Policy.

Contributions to workplace retirement planning schemes

The amount of funds accumulated in workplace retirement planning schemes for Executive Directors as at 31 December 2024 was 1,828 thousand euros (1,349 thousand euros as at 31 December 2023).

Remuneration of Senior Management members

Pursuant to applicable regulations, the information set out below includes the remuneration of Senior Management members (excluding members of the Board of Directors) and the Internal Audit Officer. The amounts include the remuneration of members of Senior Management during the period they have held this status.

Thousand euro

	2024	2023
Total remuneration () (*)	9,684	9,121
Number of members as at the end of the year	10	10

(*) Includes remuneration of the Group's previous Chief Financial Officer, who resigned as General Manager on 18 November 2024.

(**) Total remuneration as at 2024 year-end includes contributions to workplace retirement planning systems amounting to 1,050 thousand euros (964 thousand euros as at 2023 year-end).

As at the end of 2024 and 2023, no early contract termination payments were made to any member of Senior Management.

The amount of funds accumulated in workplace retirement planning schemes for Senior Management members and for the Internal Audit Officer as at 31 December 2024 was 6,026 thousand euros (4,535 thousand euros as at 31 December 2023).

The members of Senior Management and the Internal Audit Officer of Banco Sabadell as at 31 December 2024, not including Executive Directors on the Board, are the following:

Area of responsibility
IT & Ops
General Secretariat
Sustainability and Efficiency
Corporate & Investment Banking
Risk
Strategy
People
Retail Banking
Business Banking and Network
Internal Audit

Details of existing agreements between the company and members of the Board and management staff with regard to severance pay are set out in the Annual Corporate Governance Report, which is included for reference purposes in the consolidated Directors' Report.

At its meeting of 30 November 2023, the Board of Directors appointed Marcos Prat Rojo as a General Manager of Banco Sabadell; he took on the role of Strategy Director, reporting to the Chief Executive Officer, subject to obtaining the European Central Bank's statement of no objection to his suitability and effective as from that time. The Board also approved his inclusion as a member of Banco Sabadell's Management Committee during that same meeting. On 25 March 2024 a statement of no objection to that role was obtained from the European Central Bank.

At its meeting of 30 October 2024, the Board of Directors appointed Sergio Alejandro Palavecino Tomé as Chief Financial Officer and General Manager of Banco Sabadell, subject to obtaining a statement of no objection from the European Central Bank and effective as from that time. The Board also approved his inclusion as a member of Banco Sabadell's Management Committee during that same meeting. On 15 January 2025, a statement of no objection to that role was obtained from the European Central Bank.

As at the end of 2024, internal organisational changes were approved, effective as from 1 January 2025, including the appointment of Marc Armengol Dulcet as Head of Operations and Technology and as Chief Executive Officer of the UK subsidiary, TSB, thus ceasing to be a member of Banco Sabadell's Management Committee.

Other information relating to the Board

In accordance with the provisions of Article 229 of Royal Legislative Decree 1/2010 of 2 July, approving the restated text of the Capital Companies Act in relation to the duty to avoid situations of conflict of interest, and without prejudice to the provisions of Article 529 vicies et seq. of the aforesaid Act⁷ , directors have reported to the company that, during 2024, they or parties related to them, as defined in Article 231 of the Capital Companies Act:

• Have not carried out transactions with the company without taking into account usual operations, performed under standard conditions for customers and whose amount is immaterial, understanding such operations to be those that do not need to be reported to give a true and fair view of the company's equity, financial situation and income, or any operations carried out and considered to be "related party transactions" in accordance with Article 529 vicies of the Capital Companies Act, having applied the corresponding approval procedure and reporting requirement, in accordance with Articles 529 unvicies et seq. of the aforesaid Capital Companies Act.
• Have not used the name of the company or their position as director to unduly influence the performance of personal transactions.
• Have not made use of corporate assets, including the company's confidential information, for personal purposes.
• Have not taken undue advantage of the company's business opportunities.

⁷ Related-party transactions are governed by their own special regime.

• Have not obtained advantages or remuneration from third parties other than the company or its Group in connection with the performance of their duties, with the exception of acts of mere courtesy.
• Have not carried out activities on their own behalf or on behalf of a third party that involve competition with the company, whether on an isolated or potential basis, or that might otherwise place them in permanent conflict with the company's interests.

The Bank has entered into a civil liability insurance policy for 2024 that covers the Institution's directors and senior management staff. The total premium paid was 1,360 thousand euros (1,395 thousand euros in 2023).

Note 42 – Other information

Transactions with significant shareholders

No major transactions with significant shareholders were carried out during 2024 and 2023.

Environmental disclosures

In light of the challenges posed by climate change and in its capacity as a financial institution, Banco Sabadell Group has an important role to play in the transition towards a sustainable economy and in achieving the goals of the Paris Agreement and the UN 2030 Agenda. To that end, Banco Sabadell has an ESG action framework aligned with the Sustainable Development Goals (SDGs), in which climate action (SDG 13) is a priority in its business and in its corporate strategy.

Through its Sustainability Policy and its Environmental and Social Risk Framework, Banco Sabadell steers its activities and organisation in line with ESG parameters. The integration of environmental, social and governance factors is present both in decision-making and when responding to the needs and concerns of all its stakeholders. In the same vein, Banco Sabadell, TSB and Banco Sabadell Mexico have adopted those parameters in their own commitments.

As a financial institution, Banco Sabadell plays an essential role in rebuilding an inclusive and decarbonised economy. This involves mobilising resources, identifying technologies and generating opportunities, as well as incorporating new capabilities and carrying out internal transformation efforts to embed sustainability into all of its agendas. It also manages the risk associated with its customer portfolio, minimising the impact of ESG risks and funding a large portion of the investments needed to honour the Paris Agreement, the European Green Deal and the UN 2030 Agenda.

In this context, and with the goal of continuing to accelerate the economic and social transformations that will contribute to sustainable development, the Bank has been applying ESG factors to its strategy, governance and business model since 2022. It has achieved this through the launch of its ESG framework, Sabadell's Commitment to Sustainability, with specific targets for 2025-2050 across four strategic pillars. These commitments include the alignment of business targets with SDGs and they establish levers for transformation and promotion actions. The main courses of action are the following:

• Progress as a sustainable institution: the Bank focuses on achieving greenhouse gas (GHG) emissions neutrality, on making progress in diversity, on ensuring talent and on continuing to incorporate ESG criteria into its governance arrangements, in addition to collaborating in key partnerships.
• Support customers in the transition to a sustainable economy: to that end, the Institution sets decarbonisation pathways, supports customers in the transition with specialised solutions for renewable energies, energy efficiency and sustainable mobility, and it establishes the Environmental and Social Risk Framework, which contains sectoral rules that limit controversial activities and/or activities with a negative impact on social and environmental development.
• Offer investment opportunities that contribute to sustainability: in the investor ecosystem, the Bank focuses on increasing opportunities for savings and investment that contribute to sustainability, rolling out a wide range of social, ethical, green and sustainability bonds and funds, both its own and those of third parties.
• Work together for a sustainable and cohesive society: in its commitment to society, the Institution believes that it is imperative to take an active role to improve financial education, drive forward inclusion, minimise vulnerabilities and ensure secure transactions and exchanges of information.

The Bank also continues to make progress in the area of sustainable finance through its ESG Activities Plan. This plan acts as an operational tool to ensure compliance with the objectives stemming from new regulations and needs in the regulatory and supervisory environment, impacting on strategy and the business model, governance, risk management and disclosure. Among its main courses of action, which are regularly monitored by the Sustainability Committee, it is worth noting the mobilisation of resources and capabilities in sustainable finance, the progress made with the Sustainable Finance Plan, ensuring disclosure to the market and identifying the mechanisms for sustainable progress in fields such as communication, training and measurement.

All of these actions and goals set out in Sabadell's Commitment to Sustainability define the Bank's ESG roadmap.

Given the activities in which it is engaged, as at 31 December 2024, the Bank does not have any responsibilities, expenses, assets, revenues, provisions or contingencies of an environmental nature that could be deemed significant with respect to its equity, financial position or consolidated results; therefore, no specific disclosures are included in the environmental disclosures document provided for in Order JUS/616/2022 of 30 June, approving the new templates for the submission to the Companies Register of the annual financial statements of institutions required to published them.

For further details, see the Sustainability Report, which is included as part of the consolidated Directors' Report.

Customer Care Service (SAC)

The Customer Care Service (Servicio de Atención al Cliente, or SAC) and its head, who is appointed by the Board of Directors, report directly to the Compliance division and are independent of the Bank's business and operational lines. The main function of the SAC is to handle and resolve complaints and claims brought forward by customers and users of the financial services of Banco de Sabadell, S.A. and the entities that adhere to the relevant regulations, where these relate to their interests and legally recognised rights arising from contracts, transparency and customer protection regulations or good financial practices and uses, in accordance with the Banco Sabadell Regulations for the Protection of Customers and Users of Financial Services.

In addition, the SAC can issue recommendations or suggestions derived from the analysis of complaints and claims it receives.

The following entities adhere to the SAC Regulations: Sabadell Asset Management, S.A., S.G.I.I.C. Sociedad Unipersonal, Urquijo Gestión, S.G.I.I.C, S.A. and Sabadell Consumer Finance, S.A.U.

In 2024, Banco Sabadell's Customer Care Service (SAC) received 104,621 complaints and 105,355 complaints were handled during the year, with 1,565 claims and complaints pending analysis as at 31 December 2024.

	Complaints	% of total received
Product
Loans and credit secured with mortgages	62,557	59.8 %
Loans and credit not secured with collateral	10,172	9.7 %
Demand deposits and payment accounts	21,766	20.8 %
Payment instruments and electronic money	4,649	4.4 %
Other payment services	2,843	2.7 %
Other products/services	1,809	1.7 %
Other products	825	0.8 %
Total	104,621	100 %

Details of complaints received by the SAC in 2024, broken down by type of product or service, are provided here below:

Complaints and claims processed by SAC at first instance

During 2024, the SAC received 99,558 complaints and claims, in accordance with the provisions of Order ECO 734/2004 of 11 March and 100,262 have been processed. Of these, 52,781 complaints and claims were accepted and resolved and 47,481 were refused due to reasons set out in the SAC Regulations.

Of the total number of complaints and claims accepted for processing and resolved by the SAC, 31,919 (60.5%) were resolved in the customer's favour, 20,854 (39.5%) in the Institution's favour and in 8 cases the customer withdrew their complaint.

Of the total number of complaints and claims accepted for processing and resolved by the SAC, 29,676 (56.2%) were processed within a period of 15 working days, 20,789 (39.4%) within a period of less than one month and 2,316 (4.4%) within a period longer than one month.

Complaints and claims managed by the Ombudsman

At Banco Sabadell, the role of Customer Ombudsman is performed by José Luis Gómez-Dégano y Ceballos-Zúñiga. The Ombudsman is responsible for resolving complaints brought forward by the customers and users of Banco de Sabadell, S.A., and those of the other aforementioned entities associated with it, at both first and second instance, and for resolving issues that are passed on by the SAC. The Ombudsman's decisions are binding on the Institution.

In 2024, the SAC received a total of 4,289 complaints and claims via the Customer Ombudsman, of which 4,302 were handled during the year.

With regard to claims and complaints resolved by the Customer Ombudsman, 1,116 were resolved in the customer's favour, 889 were resolved in the Institution's favour, and in 9 cases the customer withdrew their complaint. The Ombudsman rejected 2,259 complaints in accordance with the regulations governing their activity. As at 31 December 2024, 59 complaints were pending submission of allegations and 29 were pending the Ombudsman's ruling.

Complaints and claims managed by the Bank of Spain and the CNMV

Under current legislation, customers or users who are dissatisfied with the response received from the SAC or from the Customer Ombudsman may submit their claims and complaints to the Market Conduct and Complaints Department of the Bank of Spain, to the CNMV, or to the Directorate General for Insurance and Pension Funds, subject to the essential prerequisite of having previously addressed their complaint or claim to the Institution.

The SAC received a total of 774 complaints referred by the Bank of Spain and the CNMV up to 31 December 2024. In 2024, taking into account complaints that remained pending at the end of the previous year, 634 were accepted for processing and resolved.

Note 43 – Subsequent events

No significant events meriting disclosure have occurred since 31 December 2024, other than those described in these notes to the consolidated annual financial statements.

Schedule I – Banco Sabadell Group companies

Banco Sabadell Group companies as at 31 December 2024 consolidated by the full consolidation method

Thousand euro
Company name	Line of business	Registered office	% Shareholding		Company data			Group investment	Contribution to reserves or losses in consolidated companies	Contribution to Group consolidated profit/(loss)
			Direct	Indirect	Capital	Other equity	Profit/ (loss)	Dividends paid	Total assets
Aurica Coinvestments, S.L.	Holding	Barcelona - Spain	—	61.76	50,594	(2,726)	4,715	2,614	52,659	31,247	(15,192)	(1,879)
Banco Atlantico (Bahamas) Bank & Trust Ltd. in Liquidation (*)	Credit institution	Nassau - Bahamas	99.99	0.01	—	142	(142)	—	—	—	—	(142)
Banco de Sabadell, S.A. (**)	Credit institution	Sabadell - Spain (***)	—		— 680,028	10,619,973 1,505,815			— 184,332,055	—	13,785,066	1,270,615
Banco Sabadell, S.A., Institución de Banca Múltiple	Credit institution	Mexico City - Mexico	99.99		0.01 635,734	(6,956)	39,706	—	5,985,029	673,037	(39,889)	21,207
BanSabadell Factura, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain 100.00		—	100	1,425	738	—	2,695	799	727	738
BanSabadell Inversió Desenvolupament, S.A.U. Holding		Sant Cugat del Valles - Spain 100.00		—	16,975	185,352	5,200	—	211,243	108,828	94,999	5,879
Bansabadell Mediación, Operador De Banca Seguros Vinculado Del Grupo Banco Sabadell, S.A.	Other regulated companies	Alicante - Spain	—	100.00	301	60	3,468	3,110	41,774	524	(2,404)	3,468
BanSabadell Reassurance, S.A.	Other regulated companies	Luxembourg - Luxembourg	100.00	—	3,600	—	(90)	—	3,580	3,600	—	(90)
Bitarte, S.A.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	6,506	(2,048)	94	—	4,441	9,272	(4,755)	94
BStartup 10, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	1,000	4,827	717	—	13,653	1,000	493	(265)
Crisae Private Debt, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain	—	100.00	3	489	252	—	882	200	292	252
Desarrollos y Participaciones Inmobiliarias 2006, S.L.U. in Liquidation	Real estate	Elche - Spain	—	100.00	—	—	—	—	1,644	—	—	(2,127)
Duncan Holdings 2022-1 Limited	Holding	London - United Kingdom	—	100.00	1	—	—	—	1	—	4,523	4,783
Duncan Holdings 2024-1 Limited	Holding	London - United Kingdom	—	100.00	1	—	—	—	1	—	—	—
Ederra, S.A.	Real estate	Sant Cugat del Valles - Spain	97.85	—	2,036	34,012	810	—	36,933	36,062	(541)	833
ESUS Energía Renovable, S.L.	Production of electricity	Vigo - Spain	—	100.00	8,000	4,182	(685)	—	43,918	13,115	(1,598)	(1,235)
Fonomed Gestión Telefónica Mediterráneo, S.A.U.	Other ancillary activities	Alicante - Spain	100.00	—	1,232	21,084	459	—	23,355	19,271	2,773	524
Gazteluberri, S.L.	Real estate	Sant Cugat del Valles - Spain	—	100.00	53	(20,875)	(686)	—	1,802	23,891	(44,712)	(686)
Gest 21 Inmobiliaria, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	7,810	1,164	(8)	—	8,976	80,516	(46,665)	(8)
Gestión Financiera del Mediterráneo, S.A.U.	Other financial services	Alicante - Spain	100.00	—	13,000	2,600	4,373	6,052	20,087	66,787	(48,083)	1,182
Gier Operations 2021, S.L.U. in Liquidation (****)	Other ancillary activities	Andorra - Andorra	100.00	—	—	16	(16)	—	—	—	—	(16)
Guipuzcoano Promoción Empresarial, S.L.	Holding	Sant Cugat del Valles - Spain	—	100.00	53	(77,366)	(2,982)	—	5,159	7,160	(84,474)	(2,982)
Hobalear, S.A.U.	Real estate	Sant Cugat del Valles - Spain	—	100.00	60	85	2	—	148	414	85	2
Hondarriberri, S.L.	Holding	Sant Cugat del Valles - Spain	99.99	0.01	41	9,052	599	—	19,068	165,669	93,672	4,304
Hotel Management 6 Gestión Activa, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00			— 135,730	28,082	(997)	—	162,816	136,335	27,476	(531)
Interstate Property Holdings, LLC.	Holding	Miami - United States	100.00	—	7,293	(525)	252	—	7,150	3,804	8,111	252
Inverán Gestión, S.L. in Liquidation	Real estate	Sant Cugat del Valles - Spain	44.83	55.17	90	(96)	(8)	—	42	45,090	(45,096)	(8)
Inversiones Cotizadas del Mediterráneo, S.L.	Holding	Alicante - Spain	100.00		— 308,000	214,897	8,184	—	988,722	589,523	(66,490)	8,184
Manston Invest, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	33,357	(13,783)	(68)	—	19,794	33,357	(13,783)	(68)
Mariñamendi, S.L.	Real estate	Sant Cugat del Valles - Spain	—	100.00	62	(11,640)	(34)	—	3,842	109,529	(121,108)	(34)
Mediterráneo Sabadell, S.L.	Holding	Alicante - Spain	50.00	50.00	85,000	17,696	254	—	103,063	510,829	(408,133)	254
Paycomet, S.L.U.	Payment institution	Torrelodones - Spain	100.00	—	200	90,604	7,941	—	145,748	103,104	22,983	5,047
Puerto Pacific Vallarta, S.A. de C.V.	Real estate	Mexico City - Mexico	—	100.00	28,947	(16,624)	(44)	—	12,279	29,164	(12,338)	(44)

Thousand euro Company name	Line of business	Registered office % Shareholding		Company data				Group investment	Contribution to reserves or losses in consolidated companies	Contribution to Group consolidated profit/(loss)
			Direct	Indirect	Capital	Other equity	Profit/ (loss)	Dividends paid	Total assets
Ripollet Gestión, S.L.U.	Other financial services	Sant Cugat del Valles - Spain 100.00		—	20	28	433	—	609,611	593	(546)	433
Rubí Gestión, S.L.U.	Other financial services	Sant Cugat del Valles - Spain 100.00		—	3	8	(11)	—	518,988	53	(42)	(11)
Sabadell Consumer Finance, S.A.U.	Credit institution	Sabadell - Spain	100.00	—	35,720	100,419	2,349	—	2,454,394	72,232	68,829	2,349
Sabadell Information Systems Limited	Provision of technology services	London - United Kingdom	—	100.00	12,036	23,479	362	—	36,179	41,296	(7,743)	289
Sabadell Digital, S.A.U.	Provision of technology services	Sabadell - Spain	100.00	—	40,243	190,801	99,391	—	1,541,892	269,695	(43,832)	86,391
Sabadell Innovation Capital, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	1,000	39,996	7	—	42,616	1,000	(8,598)	7
Sabadell Patrimonio Inmobiliario, S.A.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	30,116	789,225	(2,714)	—	817,652	863,895	(44,554)	(2,714)
Sabadell Real Estate Activos, S.A.U.	Real estate	Sant Cugat del Valles - Spain 100.00			— 100,060	234,017	(25)	—	334,336	500,622	(166,545)	(25)
Sabadell Real Estate Development, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	15,807	131,841	(14,053)	—	822,125	4,748,442	(4,585,579)	(12,055)
Sabadell Real Estate Housing, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	2,073	682	(12)	—	4,902	23,792	(21,038)	(12)
Sabadell Securities USA, Inc.	Other financial services	Miami - United States	100.00	—	551	7,405	911	—	9,123	551	6,378	911
Sabadell Strategic Consulting, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain 100.00		—	3	890	259	—	2,186	3	890	259
Sabadell Venture Capital, S. L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	3	24,564	(1,378)	—	80,562	3	11,595	1,182
Sabcapital, S.A de C.V., SOFOM, E.R.	Other financial corporations	Mexico City - Mexico	49.00		51.00 127,864	62,548	34,259	—	1,205,596	121,781	66,835	34,282
Sinia Capital, S.A. de C.V.	Holding	Mexico City - Mexico	—	100.00	20,830	2,041	4,284	—	50,342	19,492	2,811	3,785
Sinia Renovables, S.A.U.	Trusts, funds and similar financial entities	Sant Cugat del Valles - Spain 100.00		—	15,000	12,663	1,827	—	208,328	15,000	11,731	1,790
Sogeviso Servicios Gestión Vivienda Innovación Social, S.L.U.	Real estate	Alicante - Spain	100.00	—	3	10,208	(217)	—	11,112	3	11,102	484
Stonington Spain, S.L.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	60,729	(11,945)	(57)	—	49,119	60,729	(11,945)	(57)
Tasaciones de Bienes Mediterráneo, S.A. in Liquidation	Other ancillary activities	Alicante - Spain	99.88	0.12	1,000	1,504	(1)	—	2,552	5,266	(2,763)	—
Tenedora de Inversiones y Participaciones, S.L. Holding		Alicante - Spain	100.00		— 296,092	(148,006)	(42,923)	—	288,605	2,995,977	(2,868,514)	(20,172)
TSB Bank PLC	Credit institution	Edinburgh - United Kingdom	—	100.00	90,710	2,213,207	236,132	354,477	55,535,233	2,110,033	428,595	245,345
TSB Banking Group PLC	Holding	London - United Kingdom	100.00	—	7,028	2,224,146	359,284	140,097	4,045,597	2,527,195	(269,497)	1,096
TSB Banking Group plc Employee Share Trust	Other ancillary activities	Saint Helier - Jersey	—	100.00	1	(18,182)	84	—	321	—	(16,904)	2
TSB Covered Bonds (Holdings) Limited	Holding	London - United Kingdom	—	100.00	1	—	—	—	1	—	—	—
TSB Covered Bonds (LM) Limited	Other ancillary activities	London - United Kingdom	—	100.00	1	—	—	—	1	—	—	—
TSB Covered Bonds LLP	Trusts, funds and similar financial entities	London - United Kingdom	—	100.00	1	8,263	(99)	—	8,216	—	24	(99)
Urquijo Gestión, S.A.U., S.G.I.I.C.	Fund management activities Madrid - Spain		100.00	—	3,606	3,322	6,339	—	18,610	3,084	3,844	6,339
VeA Rental Homes, S.A.U.	Real estate	Sant Cugat del Valles - Spain 100.00		—	5,000	(451)	(129)	—	10,974	24,000	(19,451)	(131)
Venture Debt SVC, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	3	—	—	—	5,059	3	—	—
Total								506,350		17,206,867	5,631,022	1,667,171

Banco Sabadell Group companies as at 31 December 2024 consolidated by the full consolidation method

(*) Formerly Banco Atlantico (Bahamas) Bank & Trust Ltd.

(**) The amount reported in "Contribution to reserves or losses in consolidated companies" and in "Contribution to Group consolidated profit/(loss)" includes contributions by companies that were removed from the scope during 2024 of 0 thousand euros and -465 thousand euros, respectively.

(***) The Board of Directors of Banco Sabadell, in its meeting held on 22 January 2025, resolved to set the registered office at Sabadell, Plaça de Sant Roc no. 20. The registered office was previously located in Alicante, at Avenida Óscar Esplá, 37. (****) Formerly Gier Operations 2021, S.L.U.

Thousand euro
Company name	Line of business	Registered office	% Shareholding			Company data (a)					Contribution to reserves or losses in consolidated companies (d)	Contribution to Group consolidated profit/(loss)
			Direct	Indirect	Capital	Other equity	Profit/(loss) (b)	Dividends	paid (c) Total assets
Aurica III, Fondo de Capital Riesgo	Trusts, funds and similar financial entities	Barcelona - Spain	—	47.50	51,130	2,023	1,411	—	54,729	24,318	6,243	9,072
Aurica IIIB, S.C.R., S.A.	Trusts, funds and similar financial entities	Barcelona - Spain	—	42.85	1,382	34,409	947	—	36,849	12,520	6,070	5,513
BanSabadell Pensiones, E.G.F.P., S.A. Other regulated companies		Madrid - Spain	50.00	—	7,813	38,281	6,357	—	56,190	40,378	(17,243)	3,179
BanSabadell Seguros Generales, S.A. de Seguros y Reaseguros	Other regulated companies	Madrid - Spain	50.00	—	10,000	71,591	35,047	20,450	313,846	34,000	7,412	18,291
BanSabadell Vida, S.A. de Seguros y Reaseguros	Other regulated companies	Madrid - Spain	50.00	—	43,858	386,624	125,236	73,550	9,864,395	27,106	105,185	114,721
Catalana de Biogás Iberia, S.L.	Production of electricity	Barcelona - Spain	—	24.90	10	(864)	1	—	1	2	(2)	—
Conecta2 Generación Renovable II, S.L.U.	Other power generation	Sant Cugat del Valles - Spain	—	49.00	2,961	—	—	—	13,521	1,451	—	—
Doctor Energy Central Services, S.L.	Business and other management consultancy activities	Granollers - Spain	—	21.61	381	(36)	(119)	—	1,356	116	(69)	2
Energíes Renovables Terra Ferma, S.L. Production of electricity		Barcelona - Spain	—	50.00	6	(85)	9	—	3,537	3	(3)	—
Enerlan Solutions, S.L.	Production of electricity	Leioa - Spain	—	19.00	3	147	10	—	753	274	(238)	(6)
Financiera Iberoamericana, S.A.	Other financial corporations	Havana - Cuba	50.00	—	38,288	18,527	9,378	3,405	113,215	19,144	4,709	4,086
Flex Equipos de Descanso, S.A.	Manufacturing	Getafe - Spain	—	19.16	66,071	39,803	5,383	4,791	355,893	50,930	35,329	4,791
Ingubide, S.L.	Production of electricity	Leioa - Spain	—	19.00	3	3	57	—	351	152	(117)	(23)
Murcia Emprende, S.C.R. de R.S., S.A. Other financial services		Murcia - Spain	28.70	—	2,557	939	(375)	—	3,165	2,026	(1,083)	(47)
Parque Eólico Casa Vieja S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	633	267	(15)	—
Parque Eólico Villaumbrales S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	763	267	(15)	—
Parque Eólico Perales S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	633	267	(15)	—
Parque Eólico Los Pedrejones S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	633	267	(15)	—
Portic Barcelona, S.A.	Data processing, hosting and related activities	Barcelona - Spain	25.81	—	291	1,887	(203)	—	2,236	5	552	(47)
SBD Creixent, S.A.	Real estate	Sabadell - Spain	23.05	—	5,965	(336)	318	—	6,099	3,524	(2,296)	142
Sydinia, S.L.	Production of electricity	Albacete - Spain	—	50.00	562	(120)	1	—	1	281	(20)	(40)
Total								102,196		217,298	144,369	159,634

Banco Sabadell Group companies as at 31 December 2024 accounted for using the equity method (*)

(*) Companies accounted for using the equity method as the Group does not have control over them but does have significant influence.

(a) Figures for foreign companies translated to euros at the historical exchange rate; amounts in the consolidated income statement translated at the average exchange rate.

(b) Results pending approval by the shareholders and partners at the Annual General Meeting.

(c) Includes supplementary dividends from previous year and interim dividends paid to the Group.

(d) The heading "Reserves or accumulated losses of investments in joint ventures and associates" on the consolidated balance sheet as at 31 December 2024 also includes -65,353 thousand euros corresponding to Promontoria Challenger I, S.A., an entity classified as a non-current asset held for sale.

The balance of total revenue from associates consolidated by the equity method and individually considered to be non-material amounts to 594,396 thousand euros as at 31 December 2024. The balance of liabilities as at the end of 2024 amounts to 515,474 thousand euros. The key figures as at 2024 year-end for BanSabadell Vida, S.A. are included in Note 14 of the consolidated annual financial statements.

Changes in the scope of consolidation in 2024

Additions to the scope of consolidation:

Thousand euro
				acquisition	Fair value of equity instruments issued for the
Name of entity (or line of business) acquired or merged	Category	Effective date of the transaction	Acquisition cost	Fair value of equity instruments issued for the acquisition		% Voting rights acquired	% Total voting rights	Type of shareholding	Method	Reason
BanSabadell Reassurance, S.A.	Group	15/4/2024	3,600		—	100.00 %	100.00 %	Direct	Full consolidation	a
Conecta2 Generación Renovable II, S.L.U.	Associate	1/8/2024	1,451		—	49.00 %	49.00 %	Indirect	Equity method	b
Duncan Holdings 2024-1 Limited	Group	7/2/2024	—		—	100.00 %	100.00 %	Indirect	Full consolidation	a
Total newly consolidated subsidiaries			—
Total newly consolidated associates			1,451
(a) Incorporation of subsidiaries.
(b) Added due to acquisition of shares.
Exclusions from the scope of consolidation: Thousand euro
Name of entity (or line of business) sold, spun off or otherwise disposed of	Category	Effective date of the transaction	% Voting rights disposed of		% Total voting rights following disposal	Profit/(loss) generated	Type of shareholding	Method		Reason
Plaxic Estelar, S.L.	Associate	3/4/2024		45.01 %	— %	—	Indirect	Equity method		a
Hotel Management 6 Holdco, S.L.U.	Associate	23/12/2024		100.00 %	— %	(25)	Indirect	Equity method		a
Others						1,471
Total						1,446

(a) Removed from the scope due to dissolution and/or liquidation.

Thousand euro
Company name	Line of business	Registered office % Shareholding					Company data			Group investment	Contribution to reserves or losses in consolidated companies	Contribution to Group consolidated profit/(loss)
			Direct	Indirect	Capital	Other equity	Profit/ (loss)	Dividends paid	Total assets
Aurica Coinvestments, S.L.	Holding	Barcelona - Spain	—	61.76	50,594	(3,205)	4,712	2,614	52,175	50,594	(15,793)	(1,577)
Banco Atlantico (Bahamas) Bank & Trust Ltd.	Credit institution	Nassau - Bahamas	99.99	0.01	1,598	712	(90)	—	2,952	2,439	(435)	(90)
Banco de Sabadell, S.A. (*)	Credit institution	Alicante - Spain	—	—	680,028	10,247,219 1,088,014			— 179,945,913	—	12,961,312	1,020,744
Banco Sabadell, S.A., Institución de Banca Múltiple	Credit institution	Mexico City - Mexico	99.99	0.01	635,734	65,095	25,755	—	5,721,555	725,419	(42,119)	2,197
BanSabadell Factura, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain	100.00	—	100	812	613	—	1,828	799	114	613
BanSabadell Inversió Desenvolupament, S.A.U.	Holding	Sant Cugat del Valles - Spain	100.00	—	16,975	165,564	21,193	—	205,074	108,828	84,911	6,827
Bansabadell Mediación, Operador de Banca-Seguros Vinculado del Grupo Banco Sabadell, S.A.	Other regulated companies	Alicante - Spain	—	100.00	301	60	3,110	8,393	38,485	524	(3,552)	4,259
Bitarte, S.A.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	6,506	(2,288)	240	—	4,640	9,272	(4,582)	(173)
BStartup 10, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	1,000	4,495	509	—	12,761	1,000	(374)	(185)
Crisae Private Debt, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain	—	100.00	3	286	203	—	607	200	88	204
Desarrollos y Participaciones Inmobiliarias 2006, S.L.U. in Liquidation Real estate		Elche - Spain	—	100.00	1,942	(89,871)	(209)	—	42	1,919	(89,848)	(209)
Duncan Holdings 2022-1 Limited	Holding	London - United Kingdom	—	100.00	1	—	—	—	1	—	5,993	(1,469)
Ederra, S.A.	Real estate	Sant Cugat del Valles - Spain	97.85	—	2,036	34,452	(461)	—	36,486	36,062	(38)	(503)
ESUS Energía Renovable, S.L.	Production of electricity	Vigo - Spain	—	90.00	50	(1,522)	(313)	—	18,476	45	(1,666)	(584)
Fonomed Gestión Telefónica Mediterráneo, S.A.U.	Other ancillary activities	Alicante - Spain	100.00	—	1,232	20,652	382	—	25,479	19,271	3,477	2,068
Gazteluberri, S.L.	Real estate	Sant Cugat del Valles - Spain	—	100.00	53	(20,795)	(79)	—	1,795	23,891	(44,634)	(79)
Gest 21 Inmobiliaria, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	7,810	1,140	24	—	8,995	80,516	(46,689)	24
Gestión Financiera del Mediterráneo, S.A.U.	Other financial services	Alicante - Spain	100.00	—	13,000	2,596	6,046	9,531	21,818	66,787	(42,846)	(2,296)
Gier Operations 2021, S.L.U.	Other ancillary activities	Andorra - Andorra	100.00	—	730	(9)	(9)	—	712	730	(9)	(9)
Guipuzcoano Promoción Empresarial, S.L.	Holding	Sant Cugat del Valles - Spain	—	100.00	53	(77,109)	(258)	—	5,264	7,160	(84,207)	(258)
Hobalear, S.A.U.	Real estate	Sant Cugat del Valles - Spain	—	100.00	60	79	6	—	146	414	79	6
Hondarriberri, S.L.	Holding	Sant Cugat del Valles - Spain	99.99	0.01	41	8,991	61	—	10,100	165,669	93,348	324
Hotel Management 6 Gestión Activa, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	135,730	28,210	(129)	—	163,812	136,335	50,295	45
Hotel Management 6 Holdco, S.L.U.	Real estate	Sant Cugat del Valles - Spain	—	100.00	29,074	(24,148)	(178)	—	61,401	27,611	(22,685)	(178)
Interstate Property Holdings, LLC.	Holding	Miami - United States	100.00	—	7,293	(1,152)	211	—	6,439	3,804	7,900	211
Inverán Gestión, S.L. in Liquidation	Real estate	Sant Cugat del Valles - Spain	44.83	55.17	90	(96)	—	—	50	45,090	(45,096)	—
Inversiones Cotizadas del Mediterráneo, S.L.	Holding	Alicante - Spain	100.00	—	308,000	207,830	6,564	—	1,008,718	589,523	(73,054)	6,564
Manston Invest, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	33,357	(13,688)	(95)	—	19,921	33,357	(13,689)	(95)
Mariñamendi, S.L.	Real estate	Sant Cugat del Valles - Spain	—	100.00	62	(11,598)	(43)	—	3,821	109,529	(121,065)	(43)
Mediterráneo Sabadell, S.L.	Holding	Alicante - Spain	50.00	50.00	85,000	16,567	1,085	—	103,121	510,829	(409,218)	1,085
Paycomet, S.L.U.	Payment institution	Torrelodones - Spain	100.00	—	200	(19,658)	21,981	—	88,170	80,622	1,021	21,962
Puerto Pacific Vallarta, S.A. de C.V.	Real estate	Mexico City - Mexico	—	100.00	28,947	(14,693)	(74)	—	14,180	29,164	(12,264)	(74)

Banco Sabadell Group companies as at 31 December 2023 consolidated by the full consolidation method

Thousand euro Company name	Line of business	Registered office	% Shareholding Company data							Group investment	Contribution to reserves or losses in consolidated	Contribution to Group consolidated
			Direct	Indirect	Capital	Other equity	Profit/ (loss)	Dividends paid	Total assets		companies	profit/(loss)
Ripollet Gestión, S.L.U.	Other financial services	Sant Cugat del Valles - Spain	100.00	—	20	396	(369)	—	625,387	593	(177)	(369)
Rubí Gestión, S.L.U.	Other financial services	Sant Cugat del Valles - Spain	100.00	—	3	14	(6)	—	295,504	53	(36)	(6)
Sabadell Consumer Finance, S.A.U.	Credit institution	Sabadell - Spain	100.00	—	35,720	95,237	5,182	—	2,139,044	72,232	63,647	5,182
Sabadell Information Systems Limited	Provision of technology services	London - United Kingdom	—	100.00	12,036	21,507	422	—	34,469	41,296	(8,160)	422
Sabadell Digital, S.A.U.	Provision of technology services	Sabadell - Spain	100.00	—	40,243	236,148	(45,105)	—	1,473,772	269,695	1,434	(49,813)
Sabadell Innovation Capital, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	1,000	8,552	31,752	—	43,824	1,000	(7,607)	(991)
Sabadell Patrimonio Inmobiliario, S.A.U. Real estate		Sant Cugat del Valles - Spain	100.00	—	30,116	795,014	(5,789)	—	821,973	863,895	(38,820)	(5,734)
Sabadell Real Estate Activos, S.A.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	100,060	234,014	3	—	334,918	500,622	(166,548)	3
Sabadell Real Estate Development, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	15,807	137,336	(5,495)	—	1,036,087	4,748,442	(4,573,410)	(8,263)
Sabadell Real Estate Housing, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	2,073	662	20	—	4,786	23,792	(21,058)	20
Sabadell Securities USA, Inc.	Other financial services	Miami - United States	100.00	—	551	6,197	694	—	7,601	551	5,692	686
Sabadell Strategic Consulting, S.L.U.	Other ancillary activities	Sant Cugat del Valles - Spain	100.00	—	3	664	226	—	1,625	3	664	226
Sabadell Venture Capital, S. L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	3	14,160	2,818	—	72,709	3	9,552	1,075
Sabcapital, S.A de C.V., SOFOM, E.R.	Other financial corporations	Mexico City - Mexico	49.00	51.00	127,864	49,577	44,928	51,527	1,420,571	126,007	25,073	41,762
Sinia Capital, S.A. de C.V.	Holding	Mexico City - Mexico	—	100.00	20,830	15,320	(6,405)	—	58,881	22,435	(4,160)	9,721
Sinia Renovables, S.A.U.	Trusts, funds and similar financial entities	Sant Cugat del Valles - Spain	100.00	—	15,000	2,055	9,591	—	176,162	15,000	4,449	8,047
Sogeviso Servicios Gestión Vivienda Innovación Social, S.L.U.	Real estate	Alicante - Spain	100.00	—	3	10,078	248	—	11,960	3	11,659	(439)
Stonington Spain, S.L.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	60,729	(11,826)	(119)	—	49,277	60,729	(11,826)	(119)
Tasaciones de Bienes Mediterráneo, S.A. in Liquidation	Other ancillary activities	Alicante - Spain	99.88	0.12	1,000	1,417	87	—	2,507	5,266	(2,850)	87
Tenedora de Inversiones y Participaciones, S.L.	Holding	Alicante - Spain	100.00	—	296,092	(129,129)	(38,776)	—	232,643	2,975,977	(2,739,862)	(38,596)
TSB Bank PLC	Credit institution	Edinburgh - United Kingdom	—	100.00	90,710	1,945,133	196,655	137,839	54,786,747	1,814,636	351,887	212,331
TSB Banking Group PLC	Holding	London - United Kingdom	100.00	—	7,028	1,826,060	138,687	56,749	3,358,703	2,207,741	(245,481)	(21,409)
TSB Banking Group plc Employee Share Trust	Other ancillary activities	Saint Helier - Jersey	—	100.00	1	(15,404)	(25)	—	286	—	(14,787)	1
TSB Covered Bonds (Holdings) Limited	Holding	London - United Kingdom	—	100.00	1	—	—	—	1	—	—	—
TSB Covered Bonds (LM) Limited	Other ancillary activities	London - United Kingdom	—	100.00	1	—	—	—	1	—	—	—
TSB Covered Bonds LLP	Trusts, funds and similar financial entities	London - United Kingdom	—	100.00	1	20	3	—	72	—	21	3
Urquijo Gestión, S.A.U., S.G.I.I.C.	Fund management activities	Madrid - Spain	100.00	—	3,606	4,858	(1,536)	1,257	8,573	3,084	5,380	(1,536)
VeA Rental Homes, S.A.U.	Real estate	Sant Cugat del Valles - Spain	100.00	—	5,000	(222)	(2,229)	—	13,131	22,000	(17,222)	(2,229)
Venture Debt SVC, S.L.U.	Holding	Sant Cugat del Valles - Spain	—	100.00	3	—	—	—	5,251	3	—	—
Total								267,910		16,642,461	4,762,129	1,209,373

Banco Sabadell Group companies as at 31 December 2023 consolidated by the full consolidation method

(*) The amount reported in "Contribution to reserves or losses in consolidated companies" and in "Contribution to Group consolidated profit/(loss)" includes contributions by companies that were removed from the scope during 2023 of -14 thousand euros and -2,590 thousand euros, respectively.

Thousand euro
Company name	Line of business	Registered office		% Shareholding			Company data (a)	Group investment	Contribution to reserves or losses in consolidated companies (d)	Contribution to Group consolidated profit/(loss)
			Direct	Indirect	Capital	Other equity	Profit/(loss) (b)	Dividends	paid (c) Total assets
Aurica III, Fondo de Capital Riesgo	Trusts, funds and similar financial entities	Barcelona - Spain	—	47.50	51,130	81,088	1,306	6,290	64,340	24,318	2,115	4,128
Aurica IIIB, S.C.R., S.A.	Trusts, funds and similar financial entities	Barcelona - Spain	—	42.85	34,557	79,139	908	1,518	43,386	12,520	3,562	2,507
BanSabadell Pensiones, E.G.F.P., S.A.	Other regulated companies	Madrid - Spain	50.00	—	7,813	34,412	3,343	—	49,106	40,378	(18,915)	1,672
BanSabadell Seguros Generales, S.A. de Seguros y Reaseguros	Other regulated companies	Madrid - Spain	50.00	—	10,000	85,856	28,211	11,000	312,609	34,000	16,997	10,866
BanSabadell Vida, S.A. de Seguros y Reaseguros	Other regulated companies	Madrid - Spain	50.00	—	43,858	241,380	118,491	—	9,556,627	27,106	82,370	96,365
Catalana de Biogás Iberia, S.L.	Production of electricity	Barcelona - Spain	—	24.90	10	(373)	1	—	1	2	—	(2)
Doctor Energy Central Services, S.L.	Business and other management consultancy activities	Granollers - Spain	—	16.66	300	(100)	(166)	—	1,276	75	(50)	(19)
Energíes Renovables Terra Ferma, S.L.	Production of electricity	Barcelona - Spain	—	50.00	6	(73)	(15)	—	3,236	3	(3)	—
Enerlan Solutions, S.L.	Production of electricity	Leioa - Spain	—	19.00	3	142	80	—	559	274	—	—
Financiera Iberoamericana, S.A.	Other financial corporations	Havana - Cuba	50.00	—	38,288	13,539	9,441	2,753	104,156	19,144	3,825	4,289
Flex Equipos de Descanso, S.A.	Manufacturing	Getafe - Spain	—	19.16	66,071	58,387	6,186	4,791	365,595	50,930	36,123	3,997
Ingubide, S.L.	Production of electricity	Leioa - Spain	—	19.00	3	43	139	—	520	152	—	—
Murcia Emprende, S.C.R. de R.S., S.A.	Other financial services	Murcia - Spain	28.70	—	2,557	910	(182)	—	3,340	2,026	(910)	(173)
SBD Creixent, S.A.	Real estate	Sabadell - Spain	23.05	—	5,965	(891)	256	—	6,030	3,524	(2,299)	4
Sydinia, S.L.	Production of electricity	Albacete - Spain	—	50.00	226	(40)	1	—	1	113	—	(20)
Parque Eólico Casa Vieja S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	633	267	(15)	—
Parque Eólico Villaumbrales S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	832	267	(15)	—
Parque Eólico Perales S. L.	Production of electricity	Ponferrada - Spain	—	50.00	3	500	—	—	633	267	(15)	—
Total								26,352		219,544	120,189	122,808

Banco Sabadell Group companies as at 31 December 2023 accounted for using the equity method (*)

(*) Companies accounted for using the equity method as the Group does not have control over them but does have significant influence.

(a) Figures for foreign companies translated to euros at the historical exchange rate; amounts in the consolidated income statement translated at the average exchange rate.

(b) Results pending approval by Annual General Meeting of Shareholders and Partners.

(c) Includes supplementary dividends from previous year and interim dividends paid to Group.

(d) The heading "Reserves or accumulated losses of investments in joint ventures and associates" on the consolidated balance sheet as at 31 December 2023 also includes -65,353 thousand euros corresponding to Promontoria Challenger I, S.A., an entity classified as a non-current asset held for sale.

The balance of total revenue from associates consolidated by the equity method and individually considered to be non-material amounted to 621,313 thousand euros as at 31 December 2023. The balance of liabilities as at the end of 2023 amounted to 540,899 thousand euros.

Changes in the scope of consolidation in 2023

Additions to the scope of consolidation:

Thousand euro

	Category			Fair value of equity instruments issued for the acquisition			Type of shareholding	Method	Reason
Name of entity (or line of business) acquired or merged		Effective date of the transaction		Acquisition cost Fair value of equity instruments issued for the acquisition	% Voting rights acquired	% Total voting rights
Sydinia, S.L.	Associate	20/07/2023	113	—	50.00 %	50.00 %	Indirect	Equity method	a
Enerlan Solutions, S.L.	Associate	21/11/2023	274	—	19.00 %	19.00 %	Indirect	Equity method	a
Ingubide, S.L.	Associate	21/11/2023	152	—	19.00 %	19.00 %	Indirect	Equity method	a
Total newly consolidated subsidiaries			—
Total newly consolidated associates			539

(a) Acquisition of associates.

Exclusions from the scope of consolidation:

Thousand euro

Name of entity (or line of business) sold, spun off or otherwise disposed of	Category	Effective date of the transaction	% Voting rights disposed of	% Total voting rights following disposal	Profit/(loss) generated	Type of shareholding	Method	Reason
BanSabadell Financiación, E.F.C., S.A.	Subsidiary	10/10/2023	100.00 %	— %	—	Direct	Full consolidation	b
Business Services for Operational Support, S.A.U.	Subsidiary	19/01/2023	100.00 %	— %	43	Direct	Full consolidation	a
Duncan de Inversiones S.I.C.A.V., S.A. in Liquidation	Subsidiary	11/1/2023	99.81 %	— %	—	Direct	Full consolidation	a
Galeban 21 Comercial, S.L	Subsidiary	18/10/2023	100.00 %	— %	64	Direct	Full consolidation	a
Sabadell Innovation Cells, S.L.U.	Subsidiary	28/9/2023	100.00 %	— %	121	Direct	Full consolidation	a
Compañía de Cogeneración del Caribe Dominicana, S.A.	Subsidiary	15/2/2023	100.00 %	— %	312	Indirect	Full consolidation	a
Fuerza Eólica De San Matías, S. de R.L. de C.V.	Subsidiary	15/12/2023	100.00 %	— %	11,892	Indirect	Full consolidation	c
Urumea Gestión, S.L. in Liquidation	Subsidiary	28/12/2023	100.00 %	— %	—	Indirect	Full consolidation	a
Other					(4,237)
Total					8,195

(a) Removed from the scope due to dissolution and/or liquidation.

(b) Removed from the scope due to merger by absorption.

(c) Removed from the scope due to sale.

Schedule II – Structured entities - Securitisation funds

Thousand euro

Year	Securitisation funds fully retained on the balance sheet	Entity	Total securitised assets as at 31/12/2024	Of which: issued via mortgage transfer certificates (*)	Of which: issued via mortgage participations (*)
2005	TDA CAM 4 F.T.A	Banco CAM	64,892	10,953	53,424
2005	TDA CAM 5 F.T.A	Banco CAM	198,195	58,922	137,948
2006	TDA 26-MIXTO, F.T.A	Banco Guipuzcoano	30,194	1,117	28,679
2006	TDA CAM 6 F.T.A	Banco CAM	147,381	63,663	82,169
2006	FTPYME TDA CAM 4 F.T.A	Banco CAM	44,490	33,330	—
2006	TDA CAM 7 F.T.A	Banco CAM	234,596	100,713	131,966
2006	CAIXA PENEDES 1 TDA, F.T.A.	BMN- Penedés	79,610	17,333	62,188
2007	TDA 29, F.T.A	Banco Guipuzcoano	44,684	4,732	39,184
2007	TDA CAM 8 F.T.A	Banco CAM	206,549	55,848	148,870
2007	TDA CAM 9 F.T.A	Banco CAM	223,480	84,327	138,187
2007	CAIXA PENEDES PYMES 1 TDA, FTA CAIXA PENEDES FTGENCAT 1 TDA,	BMN- Penedés	12,895	11,775	—
2008	F.T.A.	BMN- Penedés	22,861	22,353	—
2009	ICO-FTVPO 1, F.T.H (CP)	BMN- Penedés	395	—	395
2017	TDA SABADELL RMBS 4, F.T	Banco Sabadell	2,985,630	2,983,837	—
2022	SABADELL CONSUMO 2, F.T.	Banco Sabadell	288,683	—	—
2022	DUNCAN FUNDING 2022 PLC	TSB	1,506,725	—	—
2023	SABADELL CONSUMER FINANCE AUTOS 1, F.T.	Sabadell Consumer Finance	375,333	—	—
2024	DUNCAN FUNDING 2024-1 PLC	TSB	655,458	—	—
2024	SABADELL CONSUMO 3, F.T.	Banco Sabadell	686,917	—	—
Total			7,808,968	3,448,903	823,010

(*) Corresponds to the allocation at source of loans when mortgage transfer certificates and mortgage participations were issued.

Thousand euro

Year	Securitisation funds fully derecognised from the balance sheet	Entity	Total securitised assets as at 31/12/2024	Of which: issued via mortgage transfer certificates (*)	Of which: issued via mortgage participations (**)
2006	TDA 25, FTA	Banco Gallego	—	—	—
2010	FONDO PRIVADO PYMES 1	Banco CAM	211,907	88,345	23,817
2019	SABADELL CONSUMO 1, FT	Banco Sabadell	75,745	—	—
Total			287,652	88,345	23,817

(**) Corresponds to the allocation at source of loans when mortgage transfer certificates and mortgage participations were issued.

Schedule III – Details of outstanding issues and subordinated liabilities of the Group

Debt securities issued

The breakdown of the Group's issues as at 31 December 2024 and 2023 is as follows:

Thousand euro

		Amount		Interest rate ruling as at		Issue currency	Target of offering
Issuer	Issue date	31/12/2024	31/12/2023	31/12/2024	Maturity/call date
Banco de Sabadell, S.A.	16/03/2018	6,000	6,000	MAX(EURIBOR 3M; 0.67%)	17/03/2025	Euro	Retail
Banco de Sabadell, S.A.	07/09/2018	—	750,000	1.63%	07/03/2024	Euro	Institutional
Banco de Sabadell, S.A.	14/11/2018	2,500	2,500	MAX(EURIBOR 3M; 1.5%)	14/11/2025	Euro	Retail
Banco de Sabadell, S.A.	10/05/2019	—	419,600	1.75%	10/05/2024	Euro	Institutional
Banco de Sabadell, S.A.	22/07/2019	1,000,000	1,000,000	0.88%	22/07/2025	Euro	Institutional
Banco de Sabadell, S.A.	27/09/2019	500,000	500,000	1.13%	27/03/2025	Euro	Institutional
Banco de Sabadell, S.A. (*)	07/11/2019	—	500,000	0.63%	07/11/2024	Euro	Institutional
Banco de Sabadell, S.A. (*)	11/09/2020	500,000	500,000	1.13%	11/03/2026	Euro	Institutional
Banco de Sabadell, S.A. (*)	16/06/2021	500,000	500,000	0.88%	16/06/2027	Euro	Institutional
Banco de Sabadell, S.A.	29/11/2021	67,000	67,000	MAX(EURIBOR 12M; 0.77%)	30/11/2026	Euro	Institutional
Banco de Sabadell, S.A. (*)	24/03/2022	750,000	750,000	2.63%	24/03/2025	Euro	Institutional
Banco de Sabadell, S.A.	30/03/2022	120,000	120,000	3.15%	30/03/2037	Euro	Institutional
TSB Banking Group Plc () (*) 13/06/2022		542,705	517,807	SONIA + 2.45%	13/06/2026	Pounds sterling	Institutional
Banco de Sabadell, S.A. (*)	08/09/2022	500,000	500,000	5.38%	08/09/2025	Euro	Institutional
Banco de Sabadell, S.A.	02/11/2022	750,000	750,000	5.13%	10/11/2027	Euro	Institutional
Banco de Sabadell, S.A. (*)	23/11/2022	75,000	75,000	5.50%	23/11/2031	Euro	Institutional
TSB Banking Group Plc ()(*)	09/12/2022	301,503	287,670	SONIA + 3.40%	09/12/2025	Pounds sterling	Institutional
Banco de Sabadell, S.A. (*)	07/02/2023	750,000	750,000	5.25%	07/02/2028	Euro	Institutional
Banco de Sabadell, S.A. (*)	07/06/2023	750,000	750,000	5.00%	07/06/2028	Euro	Institutional
Banco de Sabadell, S.A. (*)	08/09/2023	750,000	750,000	5.50%	08/09/2028	Euro	Institutional
TSB Banking Group Plc ()(*)	05/12/2023	241,202	230,136	SONIA + 3,28%	05/12/2027	Pounds sterling	Institutional
Banco de Sabadell, S.A. (*)	15/01/2024	750,000	—	4.00%	15/01/2029	Euro	Institutional
Banco de Sabadell, S.A. (*)	13/03/2024	500,000	—	4.25%	13/09/2029	Euro	Institutional
Banco de Sabadell, S.A. (*)	13/09/2024	542,705	—	5.00%	13/10/2029	Pounds sterling	Institutional
Banco de Sabadell, S.A. (*)	27/11/2024	500,000	—	3.500%	27/05/2030	Euro	Institutional
Subscribed by Group companies		(1,105,410)	(1,095,613)
Total straight bonds		9,293,205	8,630,100

(*) "Maturity/call date" refers to the first call option.

(**) Equivalent amount in euros as at the end of December 2024.

Thousand euro

Issuer	Issue date	Amount		Interest rate ruling as at	Maturity/call	Issue	Target of
		31/12/2024	31/12/2023	31/12/2024	date	currency	offering
Banco de Sabadell, S.A.	14/07/2014	—	10,000	Underlying benchmark	15/07/2024	Euro	Retail
Banco de Sabadell, S.A.	05/11/2018	—	10,000	Underlying benchmark	01/04/2024	Euro	Retail
Banco de Sabadell, S.A.	12/11/2018	—	3,200	Underlying benchmark	31/07/2024	Euro	Retail
Banco de Sabadell, S.A.	03/06/2022	8,900	8,900	MAX (EURIBOR 12M; 2.75%)	03/06/2027	Euro	Institutional
Banco de Sabadell, S.A.	01/08/2022	9,200	9,200	MAX (EURIBOR 12M; 4.00%)	02/08/2027	Euro	Institutional
Total structured bonds		18,100	41,300

Thousand euro

Issuer			Amount	Average interest rate	Maturity/call	Issue	Target of
	Issue date	31/12/2024 31/12/2023 31/12/2024	date	currency	offering
Banco de Sabadell, S.A. (*) Subscribed by Group companies	08/05/2024	1,126,933 (615,586)	2,125,763 (742,935)	—	Various	Euro	Institutional
Total commercial paper		511,347	1,382,828

(*) Programme with issuance limit of 7,000,000 thousand euros, which can be extended to 9,000,000 thousand euros, registered with Sociedad de Gestión de los Sistemas de Registro, Compensación y Liquidación de Valores, S.A.U. (IBERCLEAR).

Thousand euro

Issuer	Issue date	Amount		Interest rate ruling as at	Maturity/call	Issue	Target of
		31/12/2024	31/12/2023	31/12/2024	date	currency	offering
Banco de Sabadell, S.A.	26/01/2016	—	550,000	EURIBOR 3M + 0.8%	26/01/2024	Euro	Institutional
Banco de Sabadell, S.A.	24/05/2016	—	50,000	EURIBOR 3M + 0.53%	24/05/2024	Euro	Institutional
Banco de Sabadell, S.A.	10/06/2016	—	1,000,000	0.63%	10/06/2024	Euro	Institutional
Banco de Sabadell, S.A.	29/12/2016	—	250,000	0.97%	27/12/2024	Euro	Institutional
Banco de Sabadell, S.A.	26/04/2017	1,100,000	1,100,000	1.00%	26/04/2027	Euro	Institutional
Banco de Sabadell, S.A.	21/07/2017	500,000	500,000	0.89%	21/07/2025	Euro	Institutional
Banco de Sabadell, S.A.	21/12/2018	390,000	390,000	1.09%	21/12/2026	Euro	Institutional
Banco de Sabadell, S.A.	20/12/2019	—	750,000	EURIBOR 12M + 0.07%	17/06/2024	Euro	Institutional
Banco de Sabadell, S.A.	20/12/2019	750,000	750,000	EURIBOR 12M + 0.10%	22/12/2025	Euro	Institutional
Banco de Sabadell, S.A.	20/01/2020	1,000,000	1,000,000	0.13%	10/02/2028	Euro	Institutional
Banco de Sabadell, S.A.	23/06/2020	—	1,500,000	EURIBOR 12M + 0.08% 19/12/2024		Euro	Institutional
Banco de Sabadell, S.A.	30/03/2021	1,000,000	1,000,000	EURIBOR 12M + 0.02% 30/03/2026		Euro	Institutional
Banco de Sabadell, S.A.	08/06/2021	1,000,000	1,000,000	EURIBOR 12M + 0.012%	08/06/2026	Euro	Institutional
Banco de Sabadell, S.A.	08/06/2021	1,000,000	1,000,000	EURIBOR 12M + 0.02%	08/06/2027	Euro	Institutional
Banco de Sabadell, S.A.	21/01/2022	1,500,000	1,500,000	EURIBOR 12M + 0.010%	21/09/2027	Euro	Institutional
Banco de Sabadell, S.A.	30/05/2022	1,000,000	1,000,000	1.75%	30/05/2029	Euro	Institutional
Banco de Sabadell, S.A.	12/12/2022	500,000	500,000	EURIBOR 12M + 0.14%	12/06/2028	Euro	Institutional
Banco de Sabadell, S.A.	21/12/2022	500,000	500,000	EURIBOR 3M + 0.60%	20/12/2030	Euro	Institutional
Banco de Sabadell, S.A.	28/02/2023	1,000,000	1,000,000	3.50%	28/08/2026	Euro	Institutional
Banco de Sabadell, S.A.	21/12/2023	200,000	200,000	EURIBOR 3M + 0.77 %	22/12/2031	Euro	Institutional
Banco de Sabadell, S.A.	05/06/2024	1,000,000	—	3.25%	05/06/2034	Euro	Institutional
Banco de Sabadell, S.A.	17/06/2024	750,000	—	EURIBOR 3M + 0.24%	17/06/2029	Euro	Institutional
Banco de Sabadell, S.A.	15/10/2024	750,000	—	2.75%	15/04/2030	Euro	Institutional
Banco de Sabadell, S.A.	19/12/2024	1,500,000	—	2.83%	19/09/2033	Euro	Institutional
Subscribed by Group companies		(8,065,000)	(8,065,000)
Total mortgage covered bonds		7,375,000	7,475,000

	Issue date	Amount
Issuer		31/12/2024	31/12/2023	Interest rate ruling as at 31/12/2024	Maturity/call date	Issue currency	Target of offering
TSB Banking Group Plc	15/02/2019	—	575,342	SONIA + 0.87 %	15/02/2024	Pounds sterling	Institutional
TSB Banking Group Plc	22/06/2021	603,005	575,341	SONIA + 0.37 %	22/06/2028	Pounds sterling	Institutional
TSB Banking Group Plc	14/02/2023	1,206,011	1,150,682	SONIA + 0.60 %	14/02/2027	Pounds sterling	Institutional
TSB Banking Group Plc	15/09/2023	904,508	863,011	SONIA + 0.65 %	15/09/2028	Pounds sterling	Institutional
TSB Banking Group Plc	11/10/2023	603,005	575,341	SONIA + 0.63 %	10/11/2027	Pounds sterling	Institutional
TSB Banking Group Plc	05/03/2024	500,000	—	3.32%	05/03/2029	Euro	Institutional
TSB Banking Group Plc	11/09/2024	603,005	—	SONIA + 0.53 %	11/09/2029	Pounds sterling	Institutional
Subscribed by Group companies		(603,005)	(575,341)
Total Covered bonds		3,816,529	3,164,376

Securitisations

The following table shows the securities issued by asset securitisation funds outstanding as at 31 December 2024 and 2023, respectively:

Thousand euro

			Issue		Outstanding balance of liabilities
Year	Name of fund (*)	Types of issue	Number of securities	Amount	2024	2023	Yield
2005	TDA CAM 4, F.T.A	RMBS	20,000	2,000,000	11,625	25,714	EURIBOR 3M + (between 0.09% and 0.24%)
2005	TDA CAM 5, F.T.A	RMBS	20,000	2,000,000	69,609	85,251	EURIBOR 3M + (between 0.12% and 0.35%)
2006	TDA CAM 6, F.T.A	RMBS	13,000	1,300,000	47,633	55,923	EURIBOR 3M + (between 0.13% and 0.27%)
2006	TDA CAM 7, F.T.A	RMBS	15,000	1,500,000	51,988	65,853	EURIBOR 3M + (between 0.14% and 0.30%)
2006	CAIXA PENEDES 1 TDA, F.T.A	RMBS	10,000	1,000,000	20,652	26,025	EURIBOR 3M + 0.14%
2006	FTPYME TDA CAM 4, F.T.A	SMEs	15,293	1,529,300	16,541	21,662	EURIBOR 3M + 0.61%
2007	TDA CAM 8, F.T.A	RMBS	17,128	1,712,800	52,589	62,769	EURIBOR 3M + (between 0.13% and 0.47%)
2007	CAIXA PENEDES PYMES 1 TDA, F.T.A	SMEs	7,900	790,000	163	225	EURIBOR 3M + 0.8%
2007	TDA CAM 9, F.T.A	RMBS	15,150	1,515,000	78,866	92,011	EURIBOR 3M + (between 0.19% and 0.75%)
2022	SABADELL CONSUMO 2, F.T.	CONSUMER	7,591	759,100	278,902	441,140	EURIBOR 1M + (between 0.87% and 13.25%)
2023	SCF AUTOS 1, F.T.	VEHICLES	6,595	659,500	293,497	494,000	EURIBOR 1M + (between 0.69% y 9.23%)
2024	DUNCAN FUNDING 2024 PLC	RMBS	5,618	672,466	596,975	—	Compound Daily SONIA + 0.55%
2024	SABADELL CONSUMO 3 FT	CONSUMER	7,592	759,200	631,825	—	EURIBOR 1M + (between 0.80% and 5.10%)
	Total securitisation funds				2,150,865	1,370,573

(*) The securities issued by securitisation funds are listed in the AIAF market, except for those issued by DUNCAN FUNDING 2024 PLC, which are listed on the London Stock Exchange (LSE).

Subordinated liabilities

Subordinated liabilities issued by the Group as at 31 December 2024 and 2023 are as follows:

Thousand euro

		Amount		Interest rate			Target of
Issuer	Issue date	31/12/2024	31/12/2023	ruling as at 31/12/2024	Maturity/call date	Issue currency	offering
Banco de Sabadell, S.A.	06/05/2016	500,000	500,000	5.63%	06/05/2026	Euro	Institutional
Banco de Sabadell, S.A. (*)	17/01/2020	300,000	300,000	2.00%	17/01/2025	Euro	Institutional
Banco de Sabadell, S.A. (*)	15/01/2021	500,000	500,000	2.50%	15/04/2026	Euro	Institutional
TSB Banking Group Plc	30/03/2021	361,803	345,205	3.45%	30/03/2026	Euro	Institutional
Banco de Sabadell, S.A.	16/02/2023	500,000	500,000	6.00%	16/05/2028	Pounds sterling	Institutional
Banco de Sabadell, S.A. (*)	27/03/2024	500,000	_	5.13%	27/03/2029	Euro	Institutional
Subscribed by Group companies		(361,803)	(345,205)
Total subordinated bonds		2,300,000	1,800,000

(*) "Maturity/call date" refers to the first call option.

Thousand euro

Issuer	Issue date	Amount		Interest rate ruling as	Maturity/call	Issue	Target of
		31/12/2024	31/12/2023	at 31/12/2024	date	currency	offering
Banco de Sabadell, S.A. (*)	15/03/2021	500,000	500,000	5.75%	15/09/2026	Euro	Institutional
Banco de Sabadell, S.A. (*)	19/11/2021	750,000	750,000	5.00%	19/11/2027	Euro	Institutional
Banco de Sabadell, S.A. (*)	18/01/2023	500,000	500,000	9.38%	18/07/2028	Euro	Institutional

Total preferred securities 1,750,000 1,750,000

(*) Perpetual issue. "Maturity/call date" refers to date of first call option. The aforesaid subordinated securities and undated securities are perpetual, although they may be converted into newly issued Banco Sabadell shares, if either Banco Sabadell or its consolidated group has a Common Equity Tier 1 (CET1) ratio lower than 5.125%, calculated in accordance with Regulation (EU) No 575/2013 of the European Parliament and of the Council, of 26 June, on prudential requirements for credit institutions and investment firms.

The issues included in subordinated liabilities, for the purposes of credit priority, are ranked below all of the Group's regular creditors.

For the purpose of complying with the requirements of IAS 7, the table below shows the reconciliation of liabilities derived from financing activities, identifying the components of their movements:

Thousand euro
Total subordinated liabilities as at 31 December 2022	3,450,000
Newly issued	1,000,000
Redeemed	(900,000)
Capitalisation	—
Exchange rate	—
Change in subordinated liabilities subscribed by Group companies	—
Total subordinated liabilities as at 31 December 2023	3,550,000
Newly issued	500,000
Redeemed	—
Capitalisation	—
Exchange rate	—
Change in subordinated liabilities subscribed by Group companies	—
Total subordinated liabilities as at 31 December 2024	4,050,000

Schedule IV – Other risk information

Credit risk exposure

Loans and advances to customers, broken down by activity and type of guarantee

The breakdown of the balance of the heading "Loans and advances – Customers" by activity and type of guarantee, excluding advances not classed as loans, as at 31 December 2024 and 2023, respectively, is as follows:

				2024
				Secured loans. Carrying amount based on last available valuation. Loan to value
	TOTAL	Of which: secured with real estate	Of which: secured with other collateral	Less than or equal to 40%	Over 40% and less than or equal to 60%	Over 60% and less than or equal to 80%	Over 80% and less than or equal to 100%	Over 100%
General governments	9,124,565	21,346	391,961	16,131	5,990	—	813	390,373
Other financial corporations and individual entrepreneurs (financial business activity)	1,511,484	236,367	432,633	450,492	97,763	75,460	9,337	35,948
Non-financial corporations and individual entrepreneurs (non-financial business activity)	59,836,253	11,403,101	6,198,165	7,871,505	4,533,391	1,828,013	1,386,309	1,982,048
Construction and real estate development (including land)	2,148,803	1,209,196	215,472	505,100	525,022	131,127	93,586	169,833
Civil engineering construction	1,224,461	23,986	143,327	140,707	8,869	2,590	6,530	8,617
Other purposes	56,462,989	10,169,919	5,839,366	7,225,698	3,999,500	1,694,296	1,286,193	1,803,598
Large enterprises	32,233,894	2,757,885	2,386,463	2,692,703	870,583	381,242	421,766	778,054
SMEs and individual entrepreneurs	24,229,095	7,412,034	3,452,903	4,532,995	3,128,917	1,313,054	864,427	1,025,544
Other households	88,044,606	79,083,934	1,444,628	17,735,323	24,695,801	28,816,179	7,538,919	1,742,340
Home loans	78,272,006	77,977,269	200,851	16,667,131	24,008,146	28,501,396	7,402,261	1,599,186
Consumer loans	6,742,387	30,713	896,389	297,875	350,892	141,771	65,081	71,483
Other purposes	3,030,213	1,075,952	347,388	770,317	336,763	173,012	71,577	71,671
TOTAL	158,516,908	90,744,748	8,467,387	26,073,451	29,332,945	30,719,652	8,935,378	4,150,709
MEMORANDUM ITEM Refinancing, refinanced and restructured transactions	3,083,352	1,766,471	169,397	718,542	540,559	388,323	158,865	129,579

				2023
			Of which:	Secured loans. Carrying amount based on last available valuation. Loan to value
	TOTAL	Of which: secured with real estate	secured with other collateral	Less than or equal to 40%	Over 40% and less than or equal to 60%	Over 60% and less than or equal to 80%	Over 80% and less than or equal to 100%	Over 100%
General governments	8,980,558	23,776	393,229	18,369	6,621	42	857	391,116
Other financial corporations and individual entrepreneurs (financial business activity)	1,315,339	206,658	238,726	233,252	161,757	5,918	9,410	35,047
Non-financial corporations and individual entrepreneurs (non-financial business activity)	57,417,407	11,029,211	5,800,333	5,758,968	4,352,419	1,840,235	1,384,038	3,493,884
Construction and real estate development (including land)	2,253,778	1,262,384	257,299	520,929	516,954	174,633	121,393	185,774
Civil engineering construction	1,007,464	26,668	45,518	39,612	8,729	2,981	7,501	13,363
Other purposes	54,156,165	9,740,159	5,497,516	5,198,427	3,826,736	1,662,621	1,255,144	3,294,747
Large enterprises	29,971,252	2,574,879	2,095,603	1,216,378	914,663	385,915	395,883	1,757,643
SMEs and individual entrepreneurs	24,184,913	7,165,280	3,401,913	3,982,049	2,912,073	1,276,706	859,261	1,537,104
Other households	84,202,656	76,182,679	1,200,701	17,259,349	23,402,095	26,631,313	7,886,433	2,204,190
Home loans	75,264,075	74,941,780	250,150	16,421,911	22,741,620	26,263,113	7,729,403	2,035,883
Consumer loans	5,774,897	40,182	749,578	204,415	294,636	137,011	68,708	84,990
Other purposes	3,163,684	1,200,717	200,973	633,023	365,839	231,189	88,322	83,317
TOTAL	151,915,960	87,442,324	7,632,989	23,269,938	27,922,892	28,477,508	9,280,738	6,124,237
MEMORANDUM ITEM Refinancing, refinanced and restructured transactions	3,866,784	2,217,794	159,301	807,197	623,992	486,425	204,765	254,716

Forbearance

The outstanding balance of refinancing and restructuring transactions as at 31 December 2024 and 2023 is as follows:

	2024
	Credit institutions	General governments	Other financial corporations and individual entrepreneurs (financial business activity)	Non-financial corporations and individual entrepreneurs (non-financial business activity)	Of which: lending for construction and real estate development (including land)	Other households	Total
TOTAL
Not secured with collateral
Number of transactions	8	10	127	27,798	831	51,304	79,247
Gross carrying amount	2	4,923	14,316	1,516,349	79,597	182,028	1,717,618
Secured with collateral
Number of transactions	—	1	4	4,528	234	10,578	15,111
Gross carrying amount	—	49	45	1,257,775	81,450	955,215	2,213,084
Impairment allowances	—	34	11,846	593,478	46,772	241,791	847,149
Of which, non-performing loans
Not secured with collateral
Number of transactions	8	1	23	19,508	608	39,469	59,009
Gross carrying amount	2	165	13,176	874,312	41,629	139,348	1,027,003
Secured with collateral
Number of transactions	—	—	2	2,709	163	5,692	8,403
Gross carrying amount	—	—	44	530,007	51,569	620,924	1,150,975
Impairment allowances	—	34	11,828	549,212	45,349	227,027	788,101
TOTAL
Number of transactions	8	11	131	32,326	1,065	61,882	94,358
Gross value	2	4,972	14,361	2,774,124	161,047	1,137,243	3,930,702
Impairment allowances	—	34	11,846	593,478	46,772	241,791	847,149
Additional information: lending included under non-current assets and disposal groups classified as held for sale	—	—	—	262	—	—	262

Thousand euro

	2023
	Credit institutions	General governments	Other financial corporations and individual entrepreneurs (financial business activity)	Non-financial corporations and individual entrepreneurs (non-financial business activity)	Of which: lending for construction and real estate development (including land)	Other households	Total
TOTAL
Not secured with collateral
Number of transactions	—	12	66	28,834	798	59,191	88,103
Gross carrying amount	—	6,338	17,563	1,913,078	131,181	254,385	2,191,364
Secured with collateral
Number of transactions	—	1	8	5,522	276	15,644	21,175
Gross carrying amount	—	75	179	1,464,647	108,041	1,310,756	2,775,657
Impairment allowances	—	429	15,006	726,639	71,333	358,162	1,100,236
Of which, non-performing loans
Not secured with collateral
Number of transactions	—	2	32	18,946	554	45,576	64,556
Gross carrying amount	—	630	16,250	1,030,015	75,717	175,898	1,222,793
Secured with collateral
Number of transactions		1	4	3,210	197	8,232	11,447
Gross carrying amount	—	75	150	621,211	67,899	845,735	1,467,171
Impairment allowances	—	429	14,970	660,589	69,559	332,799	1,008,787
TOTAL
Number of transactions	—	13	74	34,356	1,074	74,835	109,278
Gross value	—	6,413	17,742	3,377,725	239,222	1,565,141	4,967,021
Impairment allowances	—	429	15,006	726,639	71,333	358,162	1,100,236
Additional information: lending included under non-current assets and disposal groups classified as held for sale	—	—	—	3,627	352	3,222	6,849

The value of the guarantees received to ensure collection associated with refinancing and restructuring transactions, broken down into collateral and other guarantees, as at 31 December 2024 and 2023, is as follows:

Thousand euro
Guarantees received	2024	2023
Value of collateral	1,853,105	2,374,930
Of which: securing stage 3 loans	864,805	1,151,958
Value of other guarantees	834,714	942,367
Of which: securing stage 3 loans	380,495	427,369
Total value of guarantees received	2,687,819	3,317,297

Movements in the balance of refinancing and restructuring transactions during 2024 and 2023 are as follows:

Thousand euro

Opening balance	4,967,021	5,593,638
(+) Forbearance (refinancing and restructuring) in the period	755,089	1,381,276
Memorandum item: impact recognised on the income statement for the period	96,816	146,794
(-) Debt repayments	(584,620)	(686,252)
(-) Foreclosures	(3,713)	(5,086)
(-) Derecognised from the balance sheet (reclassified as write-offs)	(97,530)	(114,835)
(+)/(-) Other changes (*)	(1,105,545)	(1,201,720)

Year-end balance 3,930,702 4,967,021

2024 2023

(*) Includes transactions no longer classified as refinancing, refinanced or restructured due to meeting the requirements for reclassification from stage 2 to stage 1 exposures (see Note 1.3.4).

The table below shows the value of transactions which, after refinancing or restructuring, were classified as stage 3 exposures during 2024 and 2023:

Thousand euro

	2024	2023
General governments	—	—
Other legal entities and individual entrepreneurs	129,446	249,593
Of which: Lending for construction and real estate development	1,893	25,064
Other natural persons	83,678	153,883
Total	213,124	403,476

The average probability of default on current refinancing and restructuring transactions broken down by activity as at 31 December 2024 and 2023 is as follows:

%	2024	2023
General governments (*)		—
Other legal entities and individual entrepreneurs	13	17
Of which: Lending for construction and real estate development	17	17
Other natural persons	14	19

(*) Authorisation has not been granted for the use of internal models in the calculation of capital requirements.

Average probability of default calculated as at 30 September 2024.

The change of PD observed in legal entities is due to the update and improvement of the IRB model carried out in 2024. The PDs observed for natural persons are well aligned as no changes have been made to the internal models.

Concentration risk

Geographical exposure

Global

The breakdown of risk concentration, by activity and at a global level, as at 31 December 2024 and 2023 is as follows:

		2024
	TOTAL	Spain	Rest of European Union	Americas	Rest of the world
Central banks and Credit institutions	36,272,233	14,204,285	12,094,202	2,829,604	7,144,142
General governments	36,987,786	26,491,016	5,830,110	2,703,372	1,963,288
Central government	25,674,103	17,059,279	5,476,828	1,174,718	1,963,278
Other	11,313,683	9,431,737	353,282	1,528,654	10
Other financial corporations and individual entrepreneurs	4,779,993	1,592,634	100,919	642,101	2,444,339
Non-financial corporations and individual entrepreneurs	62,883,853	45,718,342	4,214,524	10,864,217	2,086,770
Construction and real estate development	2,297,927	1,825,366	49,468	366,617	56,476
Civil engineering construction	1,295,087	802,765	85,105	317,067	90,150
Other purposes	59,290,839	43,090,211	4,079,951	10,180,533	1,940,144
Large enterprises	34,485,415	21,223,409	3,554,298	8,419,540	1,288,168
SMEs and individual entrepreneurs	24,805,424	21,866,802	525,653	1,760,993	651,976
Other households	88,143,961	41,121,596	1,519,928	665,591	44,836,846
Home loans	78,272,006	33,851,421	1,502,521	384,678	42,533,386
Consumer loans	6,742,387	4,623,855	6,292	13,783	2,098,457
Other purposes	3,129,568	2,646,320	11,115	267,130	205,003
TOTAL	229,067,826	129,127,873	23,759,683	17,704,885	58,475,385

Thousand euro

		2023
	TOTAL	Spain	Rest of European Union	Americas	Rest of the world
Central banks and Credit institutions	40,818,131	24,396,259	5,901,206	2,413,890	8,106,776
General governments	34,319,129	25,077,209	4,812,170	2,377,517	2,052,233
Central government	23,338,073	15,730,694	4,563,364	991,796	2,052,219
Other	10,981,056	9,346,515	248,806	1,385,721	14
Other financial corporations and individual entrepreneurs	4,514,495	1,051,126	201,741	647,539	2,614,089
Non-financial corporations and individual entrepreneurs	60,294,112	44,591,755	3,639,175	9,830,688	2,232,494
Construction and real estate development	2,364,448	1,873,580	74,974	325,046	90,848
Civil engineering construction	1,098,655	766,428	14,205	240,774	77,248
Other purposes	56,831,009	41,951,747	3,549,996	9,264,868	2,064,398
Large enterprises	32,091,522	19,952,554	2,871,965	7,856,577	1,410,426
SMEs and individual entrepreneurs	24,739,487	21,999,193	678,031	1,408,291	653,972
Other households	84,308,370	39,585,977	1,324,896	623,225	42,774,272
Home loans	75,264,075	32,888,290	1,306,620	337,152	40,732,013
Consumer loans	5,774,897	3,907,018	7,319	6,024	1,854,536
Other purposes	3,269,398	2,790,669	10,957	280,049	187,723
TOTAL	224,254,237	134,702,326	15,879,188	15,892,859	57,779,864

By autonomous community

The breakdown of risk concentration, by activity and at the level of Spanish autonomous communities, as at 31 December 2024 and 2023 is as follows:

						2024
		AUTONOMOUS COMMUNITIES
	TOTAL	Andalusia	Aragon	Asturias	Balearic Islands	Canary Islands	Cantabria	Castilla La Mancha	Castilla y León	Catalonia
Central banks and Credit institutions	14,204,285	6,516	—	—	—	—	675,463	—	—	340,977
General governments	26,491,016	838,013	200,973	485,216	281,625	623,209	3,798	104,287	1,165,056	753,196
Central government	17,059,279	—	—	—	—	—	—	—	—	—
Other	9,431,737	838,013	200,973	485,216	281,625	623,209	3,798	104,287	1,165,056	753,196
Other financial corporations and individual entrepreneurs	1,592,634	3,676	7,059	1,564	1,104	1,010	192	600	3,155	507,306
Non-financial corporations and individual entrepreneurs	45,718,342	2,283,729	964,655	1,207,186	2,013,048	1,426,144	159,343	725,414	1,079,368	11,787,070
Construction and real estate development	1,825,366	91,110	29,656	32,522	64,018	17,467	9,378	16,853	20,142	431,933
Civil engineering construction	802,765	26,752	25,486	19,449	5,899	4,588	2,209	9,292	12,429	137,437
Other purposes	43,090,211	2,165,867	909,513	1,155,215	1,943,131	1,404,089	147,756	699,269	1,046,797	11,217,700
Large enterprises	21,223,409	722,362	418,009	369,616	1,151,408	548,755	59,540	274,708	277,830	4,787,108
SMEs and individual entrepreneurs	21,866,802	1,443,505	491,504	785,599	791,723	855,334	88,216	424,561	768,967	6,430,592
Other households	41,121,596	2,976,928	602,581	1,136,105	1,548,502	680,949	131,980	558,603	783,623	15,499,621
Home loans	33,851,421	2,317,230	496,337	886,685	1,348,439	461,963	106,028	426,206	618,610	13,336,805
Consumer loans	4,623,855	523,198	56,225	116,229	123,335	191,841	18,758	102,818	107,839	1,257,706
Other purposes	2,646,320	136,500	50,019	133,191	76,728	27,145	7,194	29,579	57,174	905,110
TOTAL	129,127,873	6,108,862	1,775,268	2,830,071	3,844,279	2,731,312	970,776	1,388,904	3,031,202	28,888,170

Thousand euro

					2024
	AUTONOMOUS COMMUNITIES
	Extremadura	Galicia	Madrid	Murcia	Navarre	Valencia	Basque Country	La Rioja	Ceuta and Melilla
Central banks and Credit institutions	—	6,631	12,127,698	1	14,981	96,978	935,040	—	—
General governments	25,081	886,219	2,878,710	55,463	241,643	140,279	714,694	20,524	13,751
Central government	—	—	—	—	—	—	—	—	—
Other	25,081	886,219	2,878,710	55,463	241,643	140,279	714,694	20,524	13,751
Other financial corporations and individual entrepreneurs	18,822	2,860	483,376	3,082	3,157	504,353	31,906	19,399	13
Non-financial corporations and individual entrepreneurs	103,993	1,918,313	14,119,587	1,037,531	419,978	4,018,867	2,290,349	147,440	16,327
Construction and real estate development	1,926	63,741	828,622	24,847	5,689	123,205	53,774	9,408	1,075
Civil engineering construction	2,762	34,266	413,497	11,123	1,954	62,790	31,606	648	578
Other purposes	99,305	1,820,306	12,877,468	1,001,561	412,335	3,832,872	2,204,969	137,384	14,674
Large enterprises	18,834	538,327	8,550,785	354,124	197,981	1,586,584	1,327,246	40,105	87
SMEs and individual entrepreneurs	80,471	1,281,979	4,326,683	647,437	214,354	2,246,288	877,723	97,279	14,587
Other households	155,100	1,116,123	5,923,789	2,129,027	162,440	6,171,863	1,380,957	71,366	92,039
Home loans	116,884	820,754	4,761,165	1,705,960	135,119	4,934,905	1,233,985	58,747	85,599
Consumer loans	30,077	209,894	785,256	249,565	10,126	748,680	81,158	7,425	3,725
Other purposes	8,139	85,475	377,368	173,502	17,195	488,278	65,814	5,194	2,715
TOTAL	302,996	3,930,146	35,533,160	3,225,104	842,199	10,932,340	5,352,946	258,729	122,130

	2023
		AUTONOMOUS COMMUNITIES
	TOTAL	Andalusia	Aragon	Asturias	Balearic Islands	Canary Islands	Cantabria	Castilla La Mancha	Castilla y León	Catalonia
Central banks and Credit institutions	24,396,259	5,410	—	—	—	—	698,942	—	—	430,307
General governments	25,077,209	578,710	241,671	431,346	343,768	664,383	3,215		135,071 1,043,140	760,577
Central government	15,730,694	—	—	—	—	—	—	—	—	—
Other	9,346,515	578,710	241,671	431,346	343,768	664,383	3,215		135,071 1,043,140	760,577
Other financial corporations and individual entrepreneurs	1,051,126	3,681	1,772	1,996	1,312	850	156	627	32,962	108,516
Non-financial corporations and individual entrepreneurs	44,591,755 2,343,177			963,467 1,178,938	2,121,692	1,076,886	187,623			654,351 1,066,855 12,397,422
Construction and real estate development	1,873,580	84,243	32,392	34,190	70,540	25,438	5,298	17,468	24,539	447,318
Civil engineering construction	766,428	24,615	12,107	18,725	5,653	4,146	2,883	8,684	12,627	136,796
Other purposes	41,951,747 2,234,319			918,968 1,126,023	2,045,499	1,047,302	179,442			628,199 1,029,689 11,813,308
Large enterprises	19,952,554	737,726	414,435	376,522	1,250,346	396,396	79,599	210,930	255,722	4,981,149
SMEs and individual entrepreneurs	21,999,193 1,496,593		504,533	749,501	795,153	650,906	99,843	417,269	773,967	6,832,159
Other households	39,585,977 2,846,721			563,894 1,131,953	1,478,250	625,737	116,920	519,921		752,937 15,228,142
For house purchase	32,888,290 2,260,819		480,061	890,596	1,302,328	433,508	96,987	403,927		594,361 13,078,263
Consumer loans	3,907,018	445,359	46,353	100,552	100,212	164,035	13,001	87,486	97,486	1,135,004
Other purposes	2,790,669	140,543	37,480	140,805	75,710	28,194	6,932	28,508	61,090	1,014,875
TOTAL	134,702,326 5,777,699 1,770,804 2,744,233				3,945,022	2,367,856				1,006,856 1,309,970 2,895,894 28,924,964

Thousand euro
	2023
	AUTONOMOUS COMMUNITIES
	Extremadura	Galicia	Madrid	Murcia	Navarre	Valencia	Basque Country	La Rioja	Ceuta and Melilla
Central banks and Credit institutions	—	4,984	22,079,828	1	—	85,085	1,091,702	—	—
General governments	39,126	760,893	2,676,261	60,696	266,743	586,724	682,970	52,617	18,604
Central government	—	—	—	—	—	—	—	—	—
Other	39,126	760,893	2,676,261	60,696	266,743	586,724	682,970	52,617	18,604
Other financial corporations and individual entrepreneurs	21,180	2,603	282,444	2,130	2,738	537,554	32,564	18,031	10
Non-financial corporations and individual entrepreneurs	121,904	2,007,256	12,716,367	993,898	493,121	4,113,260	1,985,073	153,674	16,791
Construction and real estate development	2,139	89,728	813,387	26,778	9,548	139,160	42,655	7,811	948
Civil engineering construction	1,719	34,342	378,929	14,495	2,295	59,305	46,768	1,044	1,295
Other purposes	118,046	1,883,186	11,524,051	952,625	481,278	3,914,795	1,895,650	144,819	14,548
Large enterprises	21,484	613,494	7,409,234	287,277	249,810	1,624,341	990,456	53,476	157
SMEs and individual entrepreneurs	96,562	1,269,692	4,114,817	665,348	231,468	2,290,454	905,194	91,343	14,391
Other households	149,504	1,002,659	5,347,812	2,089,573	161,017	6,110,308	1,307,172	68,368	85,089
For house purchase	113,058	739,180	4,330,340	1,715,650	132,805	5,012,629	1,167,233	57,450	79,095
Consumer loans	28,303	174,860	625,842	201,006	8,536	600,720	69,838	5,371	3,054
Other purposes	8,143	88,619	391,630	172,917	19,676	496,959	70,101	5,547	2,940
TOTAL	331,714	3,778,395	43,102,712	3,146,298	923,619	11,432,931	5,099,481	292,690	120,494

Sectoral concentration

The breakdown by activity sector of loans and advances to non-financial corporations, as at 31 December 2024 and 2023, is shown below:

Thousand euro

	2024
	Gross carrying amount	Allowances
Agriculture, forestry and fishing	1,067,349	(42,871)
Mining and quarrying	547,469	(8,174)
Manufacturing	9,367,422	(234,437)
Electricity, gas, steam and air-conditioning supply	4,821,467	(64,918)
Water supply	328,816	(4,254)
Construction	4,163,397	(164,730)
Wholesale and retail trade	8,531,857	(292,663)
Transportation and storage	3,905,951	(54,363)
Hotel and catering	4,140,609	(113,671)
Information and communication	2,453,779	(38,539)
Financial and insurance activities	5,487,489	(52,769)
Real estate activities	6,260,673	(116,094)
Professional, scientific and technical activities	2,183,366	(84,345)
Administrative and support service activities	2,045,917	(38,516)
Public administration and defence, compulsory social security	592,100	(245)
Education	281,381	(10,178)
Human health services and social work activities	1,279,561	(18,796)
Arts, entertainment and recreation	436,033	(17,181)
Other services	489,367	(183,332)
Total	58,384,003	(1,540,076)

	2023
	Gross carrying amount	Allowances
Agriculture, forestry and fishing	1,079,949	(55,420)
Mining and quarrying	437,183	(7,619)
Manufacturing	8,926,171	(282,974)
Electricity, gas, steam and air-conditioning supply	4,615,623	(51,549)
Water supply	330,722	(2,431)
Construction	3,982,666	(168,404)
Wholesale and retail trade	8,715,123	(305,582)
Transportation and storage	3,718,878	(76,819)
Hotel and catering	4,423,217	(134,623)
Information and communication	2,063,748	(30,525)
Financial and insurance activities	4,761,296	(157,430)
Real estate activities	6,388,897	(163,617)
Professional, scientific and technical activities	2,290,929	(89,641)
Administrative and support service activities	1,594,423	(37,410)
Public administration and defence, compulsory social security	452,396	(506)
Education	304,439	(10,184)
Human health services and social work activities	1,036,992	(20,020)
Arts, entertainment and recreation	431,773	(22,864)
Other services	315,642	(160,511)
Total	55,870,067	(1,778,129)

Sovereign risk exposure

Sovereign risk exposures, broken down by type of financial instrument and applying the criteria required by the EBA, as at 31 December 2024 and 2023, are as follows:

Thousand euro

						2024
	Sovereign debt securities					Of which:	Derivatives
Sovereign risk exposure by country (*)	Financial assets held for trading	Financial liabilities held for trading - Short positions	Mandatorily at fair value through profit or loss	Measured at fair value through other comprehensi ve income	Financial assets at amortised cost	Loans and advances to customers (**)	Financial assets FVOCI or non derivative and non-trading financial assets measured at fair value through equity	With positive fair value	With negative fair value	Total	Other off balance sheet exposures (***)	%
Spain	85,870	34,320	—	2,350,205	15,030,019	10,025,246	—	1,839	(4,702)	27,522,797	—	72.3 %
Italy	359,729	4,144	—	209,921	3,999,632	—	—	—	—	4,573,426	—	12.0 %
United States	—	—	12,840	1,355,022	329,671	171	—	—	—	1,697,704	—	4.5 %
United Kingdom	—	—	—	397,207	1,560,187	5,084	—	—	—	1,962,478	—	5.2 %
Portugal	19,597	12,293	—	—	654,431	49,594	—	—	—	735,915	—	1.9 %
Mexico	—	—	—	808,424	100,524	93,255	—	—	—	1,002,203	—	2.6 %
Rest of the world	167,439	22,562	—	72,847	297,663	3,619	—	—	—	564,130	—	1.5 %
Total	632,635	73,319	12,840	5,193,626	21,972,127	10,176,969	—	1,839	(4,702)	38,058,653	—	100 %

(*) Sovereign risk positions shown in accordance with EBA criteria.

(**) Includes undrawn balances of credit transactions and other contingent risks (1,022 million euros as at 31 December 2024).

(***) Relates to commitments for cash purchases and sales of financial assets.

Thousand euro

						2023
	Sovereign debt securities						Of which:	Derivatives
Sovereign risk exposure by country (*)	Financial assets held for trading	Financial liabilities held for trading - Short positions	Mandatorily at fair value through profit or loss	Measured at fair value through other comprehensi ve income	Financial assets at amortised cost	Loans and advances to customers (**)	Financial assets FVOCI or non derivative and non-trading financial assets measured at fair value through equity	With positive fair value	With negative fair value	Total	Other off balance sheet exposures (***)	%
Spain	16,760	(158,175)	—	2,846,230	13,305,462	9,837,310	—	2,860		(6,040) 25,844,407	—	74.0 %
Italy	62,269	(9,798)	—	95,074	3,399,329	—	—	—	—	3,546,874	—	10.2 %
United States	—	—	12,191	1,105,010	338,484	161	—	—	—	1,455,845	—	4.2 %
United Kingdom	—	—	—	411,132	1,628,549	9,053	—	—	—	2,048,734	—	5.9 %
Portugal	—	(27,347)	—	—	734,133	—	—	—	—	706,786	—	2.0 %
Mexico	—	—	—	713,467	100,411	101,362	—	—	—	915,240	—	2.6 %
Rest of the world	6,891	(134,321)	—	72,081	443,811	8,511	—	—	—	396,974	—	1.1 %
Total	85,920	(329,641)	12,191	5,242,994	19,950,179	9,956,397	—	2,860		(6,040) 34,914,860	—	100 %

(*) Sovereign risk positions shown in accordance with EBA criteria.

(**) Includes undrawn balances credit transactions and other contingent risks (947 million euros at 31 December 2023).

(***) Relates to commitments for cash purchases and sales of financial assets.

Exposure to construction and real estate development sector

Details of lending for construction and real estate development and the relevant allowances are set out below. The lending items shown have been classified according to their intended purpose, rather than by the debtor's NACE code. This means, for example, that if a debtor is (a) a real estate company, but uses the financing for a purpose other than construction or real estate development, it is not included in this table; alternatively, if the debtor is (b) a company whose primary activity is not construction or real estate, but where the loan is used for the financing of properties intended for real estate development, it is included in the table:

Million euro

	2024
	Gross carrying amount	Surplus above value of collateral	Impairment allowances (*)
Lending for construction and real estate development (including land) (business in Spain)	1,898	523	97
Of which: risks classified as stage 3	141	74	84
Million euro
		2023
	Gross carrying amount	Surplus above value of collateral	Impairment allowances (*)
Lending for construction and real estate development (including land) (business in Spain)	2,208	562	111
Of which: risks classified as stage 3	169	92	94

(*) Allowances for the exposure for which the Bank retains the credit risk. Does not include allowances for exposures with transferred risk.

Million euro
Gross carrying amount
Memorandum item:	2024	2023
Write-offs (*)	33	12
Million euro
Memorandum item:	2024	2023
Loans to customers, excluding General Governments (business in Spain) (carrying amount)	90,215	87,451
Total assets (total business) (carrying amount)	239,598	235,173
Allowances and provisions for exposures classified as stage 2 or stage 1 (total operations)	745	922

(*) Refers to lending for construction and real estate development reclassified as write-offs during the year.

The breakdown of lending for construction and real estate development for transactions registered by credit institutions (business in Spain) is as follows:

Million euro

	Gross carrying amount 2024	Gross carrying amount 2023
Not secured with real estate	938	910
Secured with real estate	960	1,298
Buildings and other completed works	487	627
Housing	361	466
Other	125	161
Buildings and other works in progress	428	615
Housing	402	590
Other	26	25
Land	45	56
Consolidated urban land	44	55
Other land	1	1
Total	1,898	2,208

The figures presented do not show the total value of guarantees received, but rather the net carrying amount of the associated exposure.

Guarantees received associated with lending for construction and real estate development are shown below, for both years:

Million euro
Guarantees received	2024	2023
Value of collateral	1,191	1,285
Of which: securing stage 3 loans	30	44
Value of other guarantees	234	315
Of which: securing stage 3 loans	21	25
Total value of guarantees received	1,425	1,600

The breakdown of loans to households for home purchase for transactions recorded by credit institutions (business in Spain) is as follows:

		2024
	Gross carrying amount	Of which: stage 3 exposures
Loans for home purchase	36,451	715
Not secured with real estate	639	67
Secured with real estate	35,812	648

Million euro

	2023
	Gross carrying amount	Of which: stage 3 exposures
Loans for home purchase	35,271	872
Not secured with real estate	603	20
Secured with real estate	34,668	852

The tables below show home equity loans granted to households for home purchase broken down by the loan-to-value ratio (ratio of total risk to amount of last available property appraisal) of transactions recorded by credit institutions (business in Spain):

	2024
	Gross value	Of which: stage 3 exposures
LTV ranges	35,812	648
LTV <= 40%	7,051	105
40% < LTV <= 60%	10,375	136
60% < LTV <= 80%	14,582	160
80% < LTV <= 100%	2,322	113
LTV > 100%	1,481	134

Million euro

	2023
	Gross value	Of which: stage 3 exposures
LTV ranges	34,668	852
LTV <= 40%	6,942	130
40% < LTV <= 60%	9,884	182
60% < LTV <= 80%	12,923	220
80% < LTV <= 100%	3,039	149
LTV > 100%	1,880	171

Lastly, the table below gives details of assets foreclosed or received in lieu of debt by the consolidated Group's entities, for transactions recorded by credit institutions within Spain, as at 31 December 2024 and 2023:

Million euro

	2024
	Gross carrying amount	Allowances	Gross amount (*)	Allowances (*)
Real estate assets acquired through lending for construction and real estate development	281	102	327	149
Completed buildings	252	87	287	122
Housing	144	38	164	59
Other	108	49	122	63
Buildings under construction	1	—	2	1
Housing	—	—	1	—
Other	—	—	1	—
Land	28	15	39	25
Developed land	15	7	19	11
Other land	13	8	20	15
Real estate assets acquired through mortgage lending to households for home purchase	424	114	491	181
Other real estate assets foreclosed or received in lieu of debt	13	4	18	9
Capital instruments foreclosed or received in lieu of debt	—	—	—	—
Capital instruments of institutions holding assets foreclosed or received in lieu of debt	—	—	—	—
Financing to institutions holding assets foreclosed or received in lieu of debt	—	—	—	—
TOTAL	718	219	836	338

(*) Non-performing real estate assets including real estate located outside the national territory and the provision allocated in the original loan, and excluding the credit risk transferred in portfolio sales (see reconciliation between assets foreclosed or received in payment of debt and non-performing assets, below).

Million euro

	2023
	Gross carrying amount	Allowances	Gross amount (*)	Allowances (*)
Real estate assets acquired through lending for construction and real estate development	358	122	407	176
Completed buildings	325	107	366	152
Housing	182	47	201	69
Other	144	60	165	83
Buildings under construction	2	1	2	1
Housing	2	1	2	1
Other	—	—	—	—
Land	30	14	38	23
Developed land	16	7	20	11
Other land	14	7	18	11
Real estate assets acquired through mortgage lending to households for home purchase	467	123	540	198
Other real estate assets foreclosed or received in lieu of debt	18	5	25	11
Capital instruments foreclosed or received in lieu of debt	—	—	—	—
Capital instruments of institutions holding assets foreclosed or received in lieu of debt	—	—	—	—
Financing to institutions holding assets foreclosed or received in lieu of debt	—	—	—	—
TOTAL	843	249	971	385

(*) Non-performing real estate assets including real estate located outside the national territory and the provision allocated in the original loan, and excluding the credit risk transferred in portfolio sales (see reconciliation between assets foreclosed or received in payment of debt and non-performing assets, below).

The table below sets out the reconciliation between assets foreclosed or received in lieu of debt and real estate assets considered non-performing by the Group as at 31 December 2024 and 2023:

Million euro

		2024
	Gross value	Allowances	Net book value
Total real estate portfolio in the national territory (in books)	718	219	499
Total operations outside the national territory and others	1	1	1
Provision allocated in original loan	121	121	—
Credit risk transferred in portfolio sales	(4)	(2)	(2)
Total non-performing real estate	836	338	497

Million euro

	2023
	Gross value	Allowances	Net book value
Total real estate portfolio in the national territory (in books)	843	249	594
Total operations outside the national territory and others	1	1	1
Provision allocated in original loan	147	147	—
Credit risk transferred in portfolio sales	(21)	(13)	(8)
Total non-performing real estate	971	385	586

Schedule V – Annual banking report

INFORMATION REQUIRED UNDER ARTICLE 89 OF DIRECTIVE 2013/36/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF 26 JUNE 2013

This information has been prepared pursuant to Article 89 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, and the transposition thereof into Spanish national legislation in accordance with Article 87 and Transitional Provision 12 of Law 10/2014 of 26 June on the regulation, supervision and solvency of credit institutions, published in the Official State Gazette of 27 June 2014.

In accordance with the above regulations, the following information is presented on a consolidated basis and corresponds to the end of the 2024 financial year:

Thousand euro
	Turnover	No. of employees on a full time equivalent basis (*)	Profit or loss before tax	Tax expense related to profit or loss from continuing operations
Spain	4,533,148	13,082	1,825,882	(509,860)
United Kingdom	1,289,825	4,463	400,486	(113,317)
United States	242,888	252	173,396	(42,245)
Mexico	217,938	526	65,718	(6,489)
France	37,994	21	39,212	(9,420)
Portugal	9,888	14	5,404	(2,289)
Morocco	5,677	14	4,046	(1,652)
Jersey	4	—	2	—
Andorra (**)	—	—	(16)	—
Luxembourg	—	—	(90)	—
Bahamas (**)	—	—	(142)	—
Total	6,337,362	18,372	2,513,898	(685,272)

(*) Does not include 24 employees in representative offices.

(**) In liquidation.

As at 31 December 2024, the return on Group assets, calculated by dividing consolidated profit or loss for the year by total assets on the consolidated balance sheet, amounts to 0.7624%.

The name, geographical location and nature of the business activity of the companies operating in each jurisdiction are set out in Schedule I to these consolidated annual financial statements.

As can be seen in Schedule I, the main activity carried out by the Group in the different jurisdictions in which it operates is banking, and fundamentally commercial banking through a wide range of products and services for large and medium-sized enterprises, SMEs, small retailers and self-employed workers, professional groups, other individuals and bancassurance.

For the purposes of this information, business turnover is regarded as the gross margin recognised on the consolidated income statement as at 2024 year-end. Data on full-time equivalent employees have been obtained from the workforce of each company/country as at the end of 2024.

The amount of public subsidies and aid received in 2024 for training activities in Spain was 1,387 thousand euros.

• Banco Sabadell Group
• Economic, sectoral and regulatory environment
• Financial information
• Business
• Risks
• Other material disclosures

• Mission, values and business model
• Strategic priorities
• Banco Sabadell share performance and shareholders
• Corporate governance
• Customers
• Other information (tender offer)

Banco Sabadell Group

Banco de Sabadell, S.A. (hereinafter also referred to as Banco Sabadell, the Bank, the Company, or the Institution), with tax identification number (NIF) A08000143 and with registered office¹ in Sabadell, Plaça de Sant Roc, 20, engages in banking business and is subject to the standards and regulations governing banking institutions operating in Spain. It has been subject to prudential supervision on a consolidated basis by the European Central Bank (ECB) since November 2014.

The Bank is the parent company of a group of entities whose activity it controls directly and indirectly and which comprise, together with the Bank, Banco Sabadell Group. Banco Sabadell is formed of different financial institutions, brands, subsidiaries and investees that cover all aspects of financial business. It operates mainly in Spain, the United Kingdom and Mexico.

In 2024, the Group's organisation was structured around the following businesses:

• Banking Business Spain groups together the Retail Banking, Business Banking and Corporate Banking business units, with Retail Banking and Business Banking managed under the same branch network:
  • Retail Banking: offers financial products and services to individuals for personal use. These include investment products and medium- and long-term finance, such as consumer loans, mortgages, leasing and rental services, as well as other shortterm finance. Funds come mainly from customers' term and demand deposits, savings insurance, mutual funds and pension plans. The main services also include payment methods such as cards and various kinds of insurance products.
  • Business Banking: offers financial products and services to companies and self-employed persons. These include investment and financing products, such as working capital products, revolving loans and medium- and long-term finance. It also offers custom structured finance and capital market solutions, as well as specialised advice for businesses. Funds mainly come from customers' term and demand deposits and mutual funds. The main services also include collection/ payment solutions such as cards and PoS terminals, as well as import and export services. This business unit further includes Private Banking, which offers personalised expert advice, backed by specialised and high-value product capabilities for customers.
  • Corporate Banking: through its presence in Spain and in a further 11 countries, it offers financial and advisory solutions to large Spanish and international corporations and financial institutions. It structures its activity around two pillars, the first of which is the customer. It aims to serve its customers who are natural persons to meet the full range of their financial needs. This pillar is determined by the nature of those customers and includes large corporations classed under the Corporate Banking umbrella, financial institutions, Private Banking customers in the United States and the venture capital business carried out through BS Capital. The second pillar is specialised business, which encompasses the activities of Structured Finance, Treasury, Investment Banking, and Trading, Custody & Research. Its goal is to advise, design and execute custom

1 The Board of Directors of Banco Sabadell, in its meeting held on 22 January 2025, resolved to amend Article 2 of the by-laws to set the registered office at Sabadell, Plaça de Sant Roc no. 20. The registered office was previously located in Alicante, at Avenida Óscar Esplá, 37. operations that anticipate the specific financial needs of its customers, be they companies or individuals, with its scope of activity ranging from large corporations to smaller companies and customers, insofar as its solutions are the best way to meet their increasingly complex financial needs.

• Banking Business UK: the TSB franchise covers business conducted in the United Kingdom, which includes current and savings accounts, loans, credit cards and mortgages.
• Banking Business Mexico: offers banking and financial services for Corporate Banking, Commercial Banking and Retail Banking.

Banco Sabadell is the parent undertaking of a group of companies that, as at 31 December 2024, numbered a total of 84. Of these, aside from the parent company, 61 are considered subsidiaries and 22 are considered associates (as at 31 December 2023, there were 83 companies: the parent company, 60 subsidiaries and 22 associates).

1.1 Mission, values and business model

Mission and values

Banco Sabadell helps people and businesses bring their projects to life, anticipating their needs and helping them make the best economic decisions. It does this through environmentally and socially responsible management.

This is Banco Sabadell's raison d'être: to help its customers make the best economic decisions so that they may see their personal and/or business projects take shape. To that end, it gives customers the benefit of the opportunities offered by big data, digital capabilities and the expertise of its specialists.

The Bank and those who form part of it share the values that help to accomplish this mission, however, wherever and whenever that may be.

Banco Sabadell accomplishes its mission while staying true to its values:

• Commitment and Non-Conformism, values that define its way of being.
• Professionalism and Effectiveness, values that define its way of working.
• Empathy and Openness, values that define its way of interacting.

Business model, main objectives achieved and actions taken

The Institution's business model is geared towards profitable growth that generates value for shareholders. This is achieved through a strategy of business diversification based on criteria related to profitability, sustainability, efficiency and quality of service, together with a conservative risk profile, while maintaining high standards of ethics and professional conduct combined with sensitivity to stakeholders' interests.

The Bank's management model focuses on a long-term vision of customers, through constant efforts to promote customer loyalty by adopting an initiative-based and proactive approach to the relationship through the various channels that the customers of the Bank have at their disposal. The Bank offers a comprehensive range of products and services, qualified personnel, an IT platform with ample capacity to support future growth, and a relentless focus on quality.

Over the last thirteen years, Banco Sabadell has expanded its geographical footprint in Spain and increased its market share with a series of acquisitions, the most significant of which was its acquisition of Banco CAM in 2012. In 2013, Banco Sabadell was able to undertake other corporate operations as part of the restructuring of banks under suitable economic terms, such as the acquisition of the branch network of the former Caixa d'Estalvis del Penedès in Catalonia and Aragon and the acquisitions of Banco Gallego and Lloyds' business in Spain.

As a result of these acquisitions and the organic growth of recent years, Banco Sabadell has strengthened its position in some of Spain's most prosperous regions (Catalonia, Valencian Community and Balearic Islands) and it has also increased its market share in other key areas. According to the most recent information available, Banco Sabadell has a market share of 8% in loans and 7% in deposits at the domestic level. Banco Sabadell also has a good market share in other products, such as

financing granted to non-financial corporations at 9%, mutual funds at 5% and PoS turnover at 17%.

With regard to international business, Banco Sabadell has always been a benchmark. This has not changed in 2024 and Banco Sabadell continues to be present in strategic areas, supporting companies in their international activity. Over the last few years, Banco Sabadell has expanded its international footprint. The main milestones have been the acquisition of British bank TSB in 2015 and the creation of a bank in Mexico in 2016.

With these developments, the Group has become one of the largest institutions in Spain's financial system. It has a geographically diverse business (74% in Spain, 23% in the UK and 3% in Mexico) and its customer base is now six times larger than it was in 2008. It has achieved all of this whilst safeguarding its solvency and liquidity.

2024 was a year characterised, in economic terms, by an acute contrast between the economic performance of the United States, which was better than initially expected, and that of the Eurozone, weighed down by weakness in Germany, which experienced an all but stagnant economy. Spain, for its part, continued to perform well, with robust growth. Inflation also continued to converge with central bank targets throughout 2024, allowing central banks to begin cutting official interest rates towards the middle of the year, although they indicated that they would continue to follow a cautious approach to interest rate adjustments going forward. 2024 was also a year marked by political and geopolitical events, such as the conflict in the Middle East and Trump's victory in the US presidential elections, Geopolitical risks thus increased, generating an additional source of uncertainty for the economic environment. Lastly, in relation to the financial markets, 2024 was once again a positive year, particularly for risk assets.

Against this backdrop, in year-on-year terms, Banco Sabadell significantly increased its net profit, supported by good performance both in Spain and in the UK (TSB) . It is worth noting the year-on-year growth of net interest income, the reduced cost of risk, the active and growing commercial momentum, and the contained increase in costs.

Banco Sabadell conducts its business in an ethical and responsible manner, gearing its commitment to society in a way that ensures its activities have a positive impact on people and the environment. Each and every person in the organisation plays their part in applying the principles and policies of corporate social responsibility, ensuring a highquality and transparent customer service.

In addition to complying with applicable regulations and standards, Banco Sabadell has a set of policies, internal rules and codes of conduct that guarantee ethical and responsible behaviour at all levels of the organisation and in all Group activities.

1.2 Strategic priorities

In 2024, Banco Sabadell Group's strategic priorities were to (i) continue strengthening the Bank's competitive position in the domestic market and (ii) keep on improving the profitability of its businesses abroad, both in the United Kingdom and in other geographies, in addition to efficient cost control and adequate risk management.

By business line, in Retail Banking, the approach involved continuing with the profound transformation undertaken in recent years, which has resulted in a profound change in the products and services on offer and in the customer relationship model, consolidating a fundamentally digital and remote offering of products for which the customer wants autonomy, immediacy and convenience, such as consumer loans, accounts and cards. For more complex products, such as mortgages, insurance and savings/investment products, where the customer requires support, the approach is to reinforce the role of product specialists and offer multichannel support, along with greater process digitalisation.

As at the end of 2024, mortgages specialists generated over 50% of the total new business in this product. On the other hand, digital sales of consumer loans represented over 83% of the total, while pre-approved loans accounted for 87% of total new lending. Furthermore, 54% of new customers registered using the digital channel.

The goal in Retail Banking is to increase the customer base, responding better to their needs and being the main bank of more customers.

In Business Banking, the goal was to strengthen the Bank's sizeable franchise in this segment by establishing specific levers to achieve profitable growth, such as sector-specific solutions for businesses, support for customers in their internationalisation process and the expansion of specialised solutions for SMEs. This is to be reinforced with an optimal risk management framework, complementing the insights of risk experts and business experts with new business intelligence and data analytics tools. In terms of capabilities, a digital account was launched for self-employed professionals and the middle market team was bolstered to broaden the knowledge base already in use in Corporate Banking.

In 2024, the granting of new lending items continued to be steered better, so that more than 80% were granted to priority customers and sectors, and the 34 sector-specific product and service offerings for businesses and self-employed professionals were consolidated, delivering a significant increase in new business acquired from those sectors. The market share of Point-of-Sale (PoS) terminals rose to over 20%.

Private Banking already has 500 personal bankers assigned to it, and the product offering and advice tools have been enhanced with a clear growth objective for both turnover and customers.

The goal in Business Banking is to drive growth while safeguarding credit quality and boosting profitability.

The approach in Corporate Banking Spain was to develop plans to improve the profitability of each customer and increase the contribution of specialised product units to the generation of income. To that end, greater focus was placed on the continuous monitoring of customer profitability, measuring that profitability as the risk-adjusted return for each customer, and action plans were set in motion to increase profitability. As at the end of 2024, around 75% of customers had a Risk-Adjusted Return On Capital (RAROC) above 10%.

The goal in this business line is to obtain adequate profit per customer and to meet their needs.

TSB's priority was to focus on what it does best and what it is known for in the market: retail mortgages. TSB has an excellent platform, with

high operational capabilities for mortgage management and a wellestablished network of brokers, a key factor in the British market where a substantial portion of new mortgages are arranged through this channel.

After radically turning around its financial results in recent years, TSB remains focused on its core business and on reducing costs. To that end, it has launched an efficiency plan in order to increase its contribution to the Group's profitability.

In the Group's other international businesses, the priority was to actively manage the capital allocated to them by the Group. Supplementary to this, specific priorities have been defined for each geography: in Mexico, the aim is to increase profitability, focusing on improving its cost of risk and reducing its cost of funding in pesos, launching the Sabadell Mexico digital account to that end. In the case of Miami, the goal is to further strengthen the Private Banking business, while other foreign branches will prioritise the provision of support to Spanish customers in their international activities.

The financial targets for 2024 have been met.

Upon conclusion of the strategic plan for 2021-2023, whose financial targets were amply met, at the start of the year Banco Sabadell disclosed its guidance for 2024. Economic and financial developments unfolded against a backdrop of interest rates that were, on average, lower than in the previous year, although they remained at levels that were ideal for banking intermediation activity and for the recovery of demand for credit.

The Institution remains firmly committed to shareholder remuneration.

The guidance set out in the Group's business plan was reflected in the following way in the income statement for this year:

Net interest income posted growth in the mid-single digits, as estimated in June, having improved the target to twice the one set at the beginning of the year. This positive change is explained by the positive contribution of the customer margin at the ex-TSB level, thanks to upward repricing of the loan book during the first half of the year and a cost of deposits that remained at contained levels. In addition, the positive evolution of lending activity began to come through this year, driving up net interest income, and it is expected to drive it up even further in 2025. In the meantime, at TSB, net interest income gradually recovered with each passing quarter, although it ended the year with a drop in the low single digits, as expected. All in all, the target was met, since net interest income went up by 6.3% in the year at the Group level.

In terms of fees and commissions, these were expected to record a drop of around 3%, explained by weaker performance of service fees, particularly those associated with current accounts, in a context of high interest rates. This target was upgraded after the sale of the merchant acquiring business was postponed due to the tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. (BBVA). Lastly, fees and commissions were down by 2%, a slight improvement on the guidance for the year.

In terms of costs, an annual increase in recurring costs of around 2.5% was estimated; this cost containment is mainly explained by the savings delivered by the efficiency plan in TSB announced in 2023. Annual recurring costs at the Group level increased by 2.7%, as expected. It should be noted that in 2024, 21 million euros of extraordinary costs were recognised in connection with TSB's new efficiency plan.

Furthermore, the total cost of risk target was upgraded twice during the year, thanks to a diversified balance sheet, risk management actions and improved asset quality. In September, it was estimated that it would end the year at levels of around 45 basis points. That target was met, as total cost of risk stood at 42 basis points in 2024, equivalent to 714 million euros of provisions and impairments.

Similarly, profitability recorded for 2024, measured in terms of Return on Tangible Equity (ROTE), was 14.9%, in line with the profitability or ROTE target of >13%, which was also upgraded several times during the year. In addition, in 2025, the resilience of the Group's income statement is expected to allow it to keep its profitability at around 14%, measured in terms of tangible equity.

Lastly, in relation to shareholder remuneration, Banco Sabadell's Board of Directors confirmed its shareholder remuneration commitment, committing to distribute, on a recurrent basis, its excess capital above the 13% CET1 ratio (post- impact of Basel IV² ). Assuming fulfilment of the current business plan, it is thought that the excess capital generated in 2024 and 2025, along with recurring dividends and the buyback of shares pending execution following the tender offer announced by BBVA, will reach 3.3 billion euros (0.61 euros gross per share), of which 2,098 million euros or 0.3913 euros (gross) per share would correspond to 2024 and around 1,200 million euros or 0.22 euros (gross) per share would correspond to 2025, equivalent to more than 32% of the market capitalisation³ . This represents a material improvement on the 2.9 billion euros (0.53 euros gross per share) announced previously, although part of the remuneration for 2025 may be subject to supervisory approval and to delivering on that business plan.

The remuneration in 2024 alone represents around 64% of the total committed shareholder remuneration amount for the next two years.

Therefore, the main financial targets set at the start of the year had been amply surpassed by the end.

² Basel IV marks the final phase of the Basel III standards.

³ Data as at 2024 year-end.

1.3 Banco Sabadell share performance and shareholders

As at 31 December 2024 and 2023, the Bank's share capital stood at 680,027,680.875 euros and was represented by 5,440,221,447 registered shares with a par value of 0.125 euros each.

On 29 January 2025, the Board of Directors of Banco Sabadell agreed to reduce the Bank's share capital in the amount of 6,566 thousand euros, through the redemption of all the treasury shares acquired under the Share Buyback Programme approved on 10 April 2024 at Banco Sabadell's Annual General Meeting, until the suspension of that programme on 9 May 2024, i.e. 52,531,365 shares. As at the signoff date of the consolidated annual financial statements, the entry into the Companies Register of the public deed for this capital reduction remained pending.

2024 was marked by the start of an accommodative cycle by central banks, with inflation on a downward path and macroeconomic indicators in the main developed economies giving mixed signals throughout the year, due to a generally more negative bias. In geopolitical terms, the war in Ukraine remained stagnant while tensions rose in the Middle East. In the United States, Donald Trump emerged as the clear winner of the presidential elections, which heightened the uncertainty surrounding the possible establishment of tariffs and restrictions on global trade.

In Spain, economic activity continued to be dynamic, with GDP growth far above the average of countries in the European Union and with upward revisions for the coming years. In addition, the unemployment rate fell to a ten-year low, while inflation was below 2%.

In financial markets, the first half of the year was characterised by a very positive tone, specifically in the financial sector. However, as the year went on and as a result of inflation rapidly dropping closer to central banks' targets, together with macroeconomic indicators that fuelled fears of a recession, central banks began a cycle of interest rate cuts. Against this backdrop, the financial sector underwent a stock market correction given the volatility of interest rate curves, which priced in an accelerated pace of interest rate cuts as a well as a lower terminal rate.

In the Eurozone, the European Central Bank began its accommodative monetary policy in June, introducing four interest rate cuts from that month onwards and reducing the deposit facility rate by 100 basis points to 3.00%. In addition, the 12-month Euribor ended the year at around 2.5%.

Similarly, the Bank of Spain, in line with the majority of the Eurozone economies, activated the countercyclical buffer (CCyB), placing it at 0.5%, which will be applicable as from October 2025. Thereafter, if the cyclical systemic risks remain, the plan is to raise the CCyB to 1% as from October 2026.

All in all, over the year the banking industry's profitability continued to converge towards levels close to the cost of capital that banks are required to attain, thanks to higher levels of profit, in turn explained by an interest rate environment that has offered increased capacity to intermediate in the economy.

As regards Banco Sabadell's share price performance, it kept the good tone of recent years, with a revaluation, adjusted to account for dividends, of +79% in the year, ranking second on the IBEX 35 in 2024. On a like-for-like basis, the market revaluation was above the European banking industry benchmark (STOXX Europe 600 Banks), which rose by +35.4%, and also above general indices such as EURO STOXX 50 and IBEX 35, which cumulatively increased by +5.3% and +14.8%, respectively, over the year. In this respect, the factors pertaining to the

economic and financial environment mentioned above significantly influenced the share price performance. Similarly, in relation to the idiosyncratic factors of Banco Sabadell, certain influencing factors worth noting include, on one hand, the Institution's improved financial position and profit estimations and, on the other, since 9 May, everything related to the events in connection with the

tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. As at the end of 2024, 100% of equity analysts covering Banco

Sabadell had a Buy or Hold recommendation on the stock.

Banco Sabadell's market capitalisation stood at 10,063 million euros at year-end, with a Price/Tangible Book Value (P/TBV) ratio of 0.78.

	Million	Million euro	Euro	Million euro	Euro
	Average number of shares (*)	Profit attributable to the Group	Profit attributable to the Group, per share	Own funds	Book value per share
2021	5,586	530	0.080	13,357	2.39
2022 (**)	5,594	889	0.140	13,635	2.43
2023	5,401	1,332	0.225	14,344	2.65
2024	5,376	1,827	0.322	15,389	2.87

(*) The average number of shares is shown net of the treasury stock position.

(**) The data corresponding to 2022 has been restated to take into account the implementation of IFRS 17 (see Note 1.4 to the consolidated annual financial statements for 2023).

Share performance

Below are a number of indicators of the Bank's share performance:

	2024	2023	Year-on-year change (%)
Shareholders and trading
Total number of shares outstanding (million) (*)	5,361	5,403	(0.8)
Average daily trading (million shares)	23	30	(22.0)
Share price (euro)
Opening	1.113	0.881	—
High	2.050	1.364	—
Low	1.105	0.873	—
Closing	1.877	1.113	—
Market capitalisation (million euro)	10,063	6,014	—
Market ratios
Earnings per share (EPS) (euro)	0.32	0.23	—
Book value per share (euro)	2.87	2.65	—
P/TBV (price/tangible book value per share)	0.78	0.51	—
Price/earnings ratio (share price/EPS)	5.84	4.94	—

(*) Total number of shares minus final treasury stock position (including shares in buyback programmes, where applicable).

Shareholder remuneration in cash increased by 241% in the year, distributing 60% of 2024 earnings.

The Bank's shareholder remuneration commitment, in accordance with its Articles of Association, is proposed by the Board of Directors and submitted to the Annual General Meeting for approval every year. In addition, Banco Sabadell has a Shareholder Remuneration Policy that lays down the principles that determine the shareholder remuneration framework.

In the meeting held on 22 July 2024, Banco Sabadell's Board of Directors agreed to set the percentage of profits to be distributed to shareholders, in other words the Group's payout ratio, at 60% of the Group's net attributable profit for 2024. This payout ratio is at the top of the range established by the Group's Shareholder Remuneration Policy.

In addition to setting a payout ratio of 60%, the Board of Directors agreed to distribute an interim dividend in cash, to be paid out of its earnings of 2024, of 0.08 euros (gross) per share, which was paid on 1 October 2024.

The Board of Directors also updated the potential shareholder remuneration amount to be distributed charged to earnings in the 2024 and 2025 financial years to 2,650 million euros (0.49 euros per share), part of it subject to the supervisor's approval.

In line with the request received from the CNMV on 13 May 2024, the Bank released an Other Relevant Information disclosure regarding the interim suspension of the share buyback programme in light of the publication of the prior announcement of the tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A. The operation of the buyback programme was paused when approximately 27.31% of the buyback programme's maximum pecuniary amount had been executed, meaning that approximately 72.69% of the aforesaid maximum amount remains pending execution (see Note 3 to the annual financial statements). If one considered the currently suspended share buyback programme, this would raise the potential total shareholder remuneration over the next two years to 2.9 billion euros (0.53 euros gross per share).

Later, on 6 February 2025, Banco Sabadell's Board of Directors agreed to submit a proposal for the distribution of a final dividend of 0.1244 euros (gross) per share, to be approved at the next Annual General Meeting. This, together with the interim dividend of 0.08 euros (gross) per share, entail a total cash dividend to be paid out of the earnings of 2024 of 0.2044 euros (gross) per share, equivalent to a 60% payout ratio, representing an increase in cash-based shareholder remuneration of 241% compared to 2023.

In the aforesaid meeting of 6 February 2025, the Board of Directors of Banco Sabadell, having obtained prior authorisation from the competent authority, agreed to submit a proposal at the next Annual General Meeting to distribute the excess capital above the 13% CET1 ratio (post-impact of Basel IV⁴ ) through a treasury share buyback programme for the subsequent redemption of those shares for an amount of 755 million euros, equivalent to 0.1408 euros (gross) per share and resuming execution of the treasury share buyback programme in the amount of 247 million euros, equivalent to 0.0461 euros (gross) per share, which was temporarily suspended due to publication of the announcement of the tender offer put forward by Banco Bilbao Vizcaya Argentaria, S.A.

Based on the foregoing, total shareholder remuneration in 2024 will amount to 2,098 million euros, or 0.3913 euros (gross) per share, of which 1,096 million euros (0.2044 euros gross per share) correspond to the cash dividend and 1,002 million euros (0.1869 euros gross per share) correspond to buyback programmes.

Thus, Banco Sabadell's Board of Directors seized the opportunity and updated its total shareholder remuneration for the next two years, improving it from the previously announced 2.9 billion euros (0.53 euros gross per share) to 3.3 billion euros (0.61 euros gross per share) of which, as mentioned, 2,098 million euros (0.3913 euros gross per share) would correspond to 2024 and around 1.2 billion euros (0.22 euros gross per share) would correspond to 2025).

⁴ Basel IV marks the final phase of the Basel III standards.

Credit ratings

In 2024, the four agencies that assessed Banco Sabadell's credit quality were S&P Global Ratings, Morningstar DBRS, Fitch Ratings and Moody's Investors Service.

On 29 April 2024, S&P Global Ratings affirmed Banco Sabadell's long-term issuer rating at 'BBB+', improving the outlook to positive from stable, reflecting the possibility that it could raise the long-term rating over the next 18-24 months if industry risks for banks operating in Spain were to ease and, at the same time, Banco Sabadell strengthens its financial ratios further. The short-term rating was also maintained at 'A-2'.

On 10 May 2024, Morningstar DBRS confirmed Banco Sabadell's long-term issuer rating at 'A (low)' with a stable outlook, reflecting the significantly improved profitability and the restructuring plan that the Bank has implemented, enabling it to boost its operating efficiency. It also praised its good access to wholesale markets and liquidity, as well as its solid capitalisation. The short-term rating remained at 'R-1 (low)'. The full report on the revision was published on 7 June.

On 8 October 2024, Moody's Investors Service affirmed Banco Sabadell's long-term deposit rating at 'Baa1' and its long-term senior unsecured debt rating at 'Baa2', maintaining the positive outlook for both ratings. The affirmed ratings reflect the strength of the Bank's credit profile, with stronger asset-quality metrics and improved profitability during the first quarter of 2024. The short-term rating was kept at 'P-2'. The full report on the revision was published on 15 October.

On 10 January 2025, Fitch Ratings upgraded Banco Sabadell's longterm rating to 'BBB+' from 'BBB' and maintained the stable outlook. The upgrade was driven by the strengthening of Banco Sabadell's asset quality, profitability and capitalisation, as well as the improved assessment of the operating environment for Spanish banks. Prior to this upgrade, on 29 May 2024, Fitch Ratings had already improved Banco Sabadell's long-term rating to 'BBB' from 'BBB-' and its short-term rating to 'F2' from 'F3'.

During 2024, Banco Sabadell has been in continuous contact with the four agencies. In its meetings with analysts from those agencies, both face-to-face and virtual meetings, aspects such as progress with results, capital, liquidity, risks, credit quality, and management of NPAs were discussed.

The table below details the current ratings and the last date on which any publication reiterating this rating was made.

	Long-term	Short-term	Outlook	Last updated
S&P Global Ratings	BBB+	A-2	Positive	29/04/2024
Morningstar DBRS	A (low)	R-1 (low)	Stable	07/06/2024
Moody´s Investors Service	Baa2	P-2	Positive	15/10/2024
Fitch Ratings	BBB+	F2	Stable	10/01/2025

1.4 Corporate governance

Banco Sabadell has a solid corporate governance structure that ensures effective and prudent management of the Bank, in which it prioritises ethical, sound and transparent governance, taking into account the interests of shareholders, customers, employees and the general public in the geographies in which it operates.

The internal governance framework, which gives details, among other aspects, about its shareholding structure, the governing bodies, the Group's structure, the composition and operation of corporate governance, the internal control functions, key governance matters, the risk management framework, the internal procedure for the approval of credit transactions granted to directors and their related parties and the Group's policies, is published on the corporate website: www.grupbancsabadell.com (see section "Corporate Governance and Remuneration Policy – Internal Governance Framework").

As required by Article 540 of the Spanish Capital Companies Act, Banco Sabadell Group has prepared the Annual Corporate Governance Report for the year 2024, which, in accordance with Article 49 of the Spanish Commercial Code, forms part of the consolidated Directors' Report for 2024. It includes a section on the extent to which the Bank follows recommendations on corporate governance currently in existence in Spain.

As it has done on previous occasions, Banco Sabadell has opted to prepare the Annual Corporate Governance Report in free PDF format, in accordance with CNMV Circular 2/2018 of 12 June, in order to explain and publicise, with maximum transparency, the main aspects contained therein.

Annual General Meeting 2024

The Bank's main governing body is the Annual General Meeting, in which shareholders decide on matters attributed to the Meeting by law, the Articles of Association (available on the corporate website under "Corporate Governance and Remuneration Policy – Articles of Association") and its own Regulation, as well as any business decisions that the Board of Directors considers to be of vital importance for the Bank's future and corporate interests.

The Annual General Meeting has adopted its own Regulation, which sets out the principles and basic rules of action (available on the corporate website under "Shareholders' General Meeting – Regulations of the Shareholders' Meeting"), safeguarding shareholder rights and transparency.

At the Annual General Meeting, shareholders may cast one vote for every thousand shares that they own or represent. The Policy for communication and contact with shareholders, institutional investors and proxy advisors, approved by the Board of Directors and compliant with the Good Governance Code of Listed Companies of June 2020, aims to promote the transparency of public information and build trust while safeguarding, at all times, the legitimate interests of institutional investors, shareholders and proxy advisors and of all other stakeholders of Banco Sabadell.

The Bank has maintained the highest standards of transparency and participation to improve and promote the participation of shareholders at the Annual General Meeting of 10 April 2024, so that they were able to attend in person as well as remotely through a live broadcast, continuing the approach adopted in 2022, vote on motions on the agenda and speak during question time. To that end, the Bank reiterated that it has set up electronic channels through Banco Sabadell's websites (corporate website and BSOnline) and its mobile app (BSMovil) so that shareholders can delegate and cast their vote in advance of the Annual General Meeting.

Those channels are embedded on the Bank's website and they provide a fast and straightforward experience to customers who are shareholders and to shareholders in general, in addition to making interactions easier.

The Annual General Meeting for 2024, convened on 22 February 2024, took place on 10 April 2024, on second call.

The Ordinary Annual General Meeting, held on 10 April 2024, approved all items on the agenda, among them the annual financial statements and corporate management corresponding to the financial year 2023 and, in relation to appointments, the re-election as member of the Board of Directors of Mireya Giné Torrens, in the capacity of Independent Director. On 13 February 2024, José Manuel Martínez Martínez resigned from his role as Independent Director of Banco Sabadell, effective from the date of the next Ordinary Annual General Meeting. To fill this vacancy, during the aforesaid Annual General Meeting, at the proposal of the Board Appointments and Corporate Governance Committee, shareholders agreed to appoint Ana Colonques García-Planas as Independent Director, who joined the Board for the first time at the meeting of 30 May 2024, having received the corresponding regulatory authorisations.

In the interest of complying with the aforementioned principle of transparency, and in response to the participation of investors and proxy advisors in the corporate governance roadshows, in 2023 the Bank approved a new Director Remuneration Policy and announced several new measures, including new remuneration for the Chief Executive Officer for his executive duties. This new remuneration was reported in the Director Remuneration Report of 2023, which was put to an advisory vote at the 2024 Annual General Meeting, receiving 96.91% of votes in favour.

The aforesaid Annual General Meeting approved, under item four of the agenda and with 99.23% of votes in favour, a resolution to reduce Banco Sabadell's share capital by the par value of the treasury shares that may be acquired by the Institution under the share buyback programme, against earnings for 2023, for a maximum pecuniary amount of 340 million euros.

On 25 April 2024, Banco Sabadell released an Inside information disclosure entered in the CNMV's register under number 2,203 to announce the terms and commencement of the share buyback programme approved by the Board of Directors on 24 April 2024. On 13 May 2024, pursuant to the request received from the CNMV on that same date, Banco Sabadell released an Other Relevant Information disclosure, entered in the CNMV's register under number 28,561, giving notice of the interim suspension of the aforementioned share buyback programme in light of the publication of the prior announcement of the voluntary tender offer put forward by BBVA for the acquisition of Banco Sabadell shares representing its total share capital.

The operation of the buyback programme was discontinued before the opening of the session of 9 May 2024, the amount paid for the shares purchased under the buyback programme up to (and including) 8 May 2024 being 92,864,152.55 euros, representing approximately 27.31% of the maximum pecuniary amount of the buyback programme, therefore approximately 72.69% of the said maximum amount remains to be executed.

At its meeting of 29 January 2025, the Bank's Board of Directors agreed to partially execute the capital reduction resolution approved by the Annual General Meeting on 10 April 2024, in the amount of 6,566,420.625 euros, through the redemption of the 52,531,365 shares acquired by virtue of the aforesaid buyback programme up to the time of its suspension. The aforesaid resolution already envisaged the possibility of it not being executed or only partially executed it due to unforeseen circumstances. As at the date of this report, the public deed for the capital reduction had not yet been entered in the Companies Register.

As regards sustainability, it is also important to note that for the fourth consecutive year, Banco Sabadell has obtained certification of its Annual General Meeting as a "Sustainable Event", having satisfactorily met the sustainability criteria for certification and having passed the preliminary assessment process and the in-person audit conducted by Eventsost, a comprehensive sustainability certification platform for events. The certification is based on the event sustainability standards considered in the Eventsost certification scheme for sustainable events, and on alignment with the Sustainable Development Goals of the UN's 2030 Agenda applied to event production.

In addition, an external consultant verified the procedures established for preparing and holding the Annual General Meeting for 2024. The external consultant carried out an individual analysis of each of the phases into which the review was divided (phase I: pre-Meeting, phase II: Meeting, and phase III: post-Meeting), concluding that, from a technical, procedural and legal point of view, all requirements, internal procedures and applicable regulations had been complied with in the three phases analysed.

Information regarding the 2024 Annual General Meeting is published on the corporate website: www.grupbancsabadell.com (see section "Shareholders and Investors - Shareholders' General Meeting").

Composition of the Board of Directors

With the exception of matters reserved to the Annual General Meeting, Banco Sabadell's Board of Directors is the most senior decision-making body of the Company and its consolidated Group, as it is responsible, under the law and the Articles of Association, for the management and representation of the Bank. The Board of Directors acts mainly as an instrument of supervision and control, delegating the management of ordinary business matters to the Chief Executive Officer.

The Board of Directors is subject to well-defined and transparent rules of governance, in particular to the Articles of Association and the Regulation of the Board of Directors (available on the corporate website under "Corporate Governance and Remuneration Policy – Regulation of the Board of Directors"), and it conforms to best practices in the area of corporate governance.

As at 31 December 2024, the Board of Directors was formed of 15 members: its Chairman (in the capacity of Other External Director), ten Independent Directors, two Executive Directors, one Other External Director and one Proprietary Director. The composition of the Board keeps an adequate balance between the different director categories that comprise it.

The Board of Directors has a diverse and efficient composition. It is of the appropriate size to perform its duties effectively by drawing on a depth and diversity of opinions, enabling it to operate with a good level of quality and effectiveness and in a participatory way. Its members are suitably diverse in terms of skill sets, professional background, origin and gender, and they have extensive experience in banking, finance, antimoney laundering & counter-terrorist financing, digital transformation & IT, insurance, risk & auditing, in regulatory affairs and the law, in academia, human resources & consultancy, responsible business practices & sustainability, as well as in international business. The Board's Matrix of Competences and Diversity can be consulted on the website in Banco Sabadell's Internal Governance Framework (see corporate website section "Corporate governance and Remuneration Policy – Internal Governance Framework").

Banco Sabadell has had this competences and diversity matrix in place since 2019, which is reviewed annually by the Board of Directors, following a favourable report from the Board Appointments and Corporate Governance Committee, and which was last reviewed on 24 April 2024, as a result of the most recent Board appointment of Ana Colonques García-Planas.

As at 2024 year-end, there were six female Directors, including five female Independent Directors out of a total of ten Independent Directors and one female Other External Director. Women account for 40% of the Board of Directors, with this percentage having been attained ahead of the timeframes provided in Organic Law 2/2024 of 1 August on equal representation and balanced presence of women and men, and fulfilling the Bank's commitment stated in Sabadell's Commitment to Sustainability for 2024. Similarly, the presence of a new female director adds to the age diversity of the Board of Directors.

In relation to knowledge, skills and experience, the incorporation of Ana Colonques García-Planas has increased and reinforced the diversity of banking knowledge and experience and, in particular, the financial profile with executive and business experience, with knowledge about accounting and auditing, risk management and control, planning and strategy, corporate governance and sustainability and the ability to apply such knowledge and skills to the banking business. All of that, combined with the multi-disciplinary and executive capabilities of the new female Director, have helped to consolidate the collective suitability of the Board of Directors and to maintain its collective ability to challenge the Bank's

Board of Directors 31 December 2024

Chair

Josep Oliu Creus

Deputy Chair Pedro Fontana García

Sabadell Group CEO César González-Bueno Mayer

Female directors

Aurora Catá Sala Ana Colonques García-Planas María José García Beato Mireya Giné Torrens Laura González Molero Alicia Reyes Revuelta

Male directors

Lluís Deulofeu Fuguet David Martínez Guzmán Manuel Valls Morató Pedro Viñolas Serra

Lead Independent Director George Donald Johnston III

Director-General Manager David Vegara Figueras

Non–Director Secretary Miquel Roca i Junyent

Non-Director Deputy Secretary Gonzalo Barettino Coloma

executives and to perform its overarching supervisory and control functions.

The Banco Sabadell Director Selection Policy of 25 February 2016 (amended on 29 September 2022 and reviewed with no amendments on 19 September 2024) establishes the principles and criteria that should be taken into account in selection processes and also, therefore, in the initial fit and proper assessment and ongoing assessments of the members of the Board of Directors, as well as in the re-election of members of the management body in order to ensure their smooth succession, the continuity of the Board of Directors and the suitability of all its members.

The process for selecting candidates to sit on the Board of Directors and for re-electing existing Directors is governed, among other things, by the diversity principle, fostering the diversity of the Board of Directors in order to promote a diverse pool of members, and ensuring that a broad set of qualities and competences is engaged when recruiting members, to achieve a variety of views and experiences and to facilitate independent opinions and sound decision-making within the Board of Directors.

The Board of Directors should ensure that the procedures for selecting its members apply the diversity principle and favour diversity in relation to aspects such as age, gender, disability, geographical provenance and educational and professional background, as well as any other aspects deemed suitable to ensure the suitability and diversity of its pool of members. Furthermore, it should ensure that such procedures are free from implicit bias that may entail any degree of discrimination and, in particular, that they facilitate the selection of female directors in the number required to achieve a composition that is balanced between women and men.

The Board of Directors has a Lead Independent Director who, in accordance with the Articles of Association, may ask the Board of Directors to call a meeting, request the inclusion of new items on the agenda, coordinate and convene Non-Executive Directors, voice the opinions of External Directors and lead, where applicable, the regular appraisal of the Chairman of the Board of Directors. In addition, the Lead Independent Director coordinates the Succession Plan for the Chairman and Chief Executive Officer, approved in 2016 and reviewed in January 2024, and leads meetings with investors and proxy advisors.

To ensure better and more diligent performance of its general supervisory duties, the Board of Directors undertakes to directly perform the responsibilities provided by law. These include:

• those deriving from generally applicable rules on corporate governance;
• approving the Company's general strategies;
• appointing and, where necessary, removing directors of subsidiaries;
• identifying the Company's main risks and implementing and monitoring the appropriate internal control and reporting systems;
• drawing up policies on the disclosure of information and communication with shareholders, markets and the general public;
• setting policy on treasury stock in accordance with any guidelines laid down at the Annual General Meeting;
• approving the Annual Corporate Governance Report;
• authorising the Company's transactions with directors and significant shareholders that may lead to conflicts of interest; and
• generally deciding on business or financial transactions that are of particular importance for the Company.

Board Committees

Pursuant to the Articles of Association, the Board of Directors has the following Board Committees:

• The Board Strategy and Sustainability Committee.
• The Delegated Credit Committee.
• The Board Audit and Control Committee.
• The Board Appointments and Corporate Governance Committee.
• The Board Remuneration Committee.
• The Board Risk Committee.

The organisation and structure of the Board Committees are set out in the Articles of Association, in the Regulation of the Board of Directors and in the respective Regulations of the Board Committees, which set forth rules for their composition, operation and responsibilities (see corporate website section "Corporate Governance and Remuneration Policy – Regulations of the Committees"), and also develop and supplement the rules of operation and basic functions set forth in the Articles of Association and in the Regulation of the Board of Directors.

Board Committees have sufficient resources to perform their duties and they may seek external professional advice and information on any aspect of the Institution, having unrestricted access both to Senior Management and Group executives and to all information and documentation, of any kind, held by the Institution on matters within their remit.

On 10 April 2024, José Manuel Martínez Martínez ceased to be a member of the Board Appointments and Corporate Governance Committee and of the Board Remuneration Committee following his resignation from the role of Director. At its meeting held on that same date, the Board of Directors agreed to appoint Independent Director and Deputy Chair of the Board of Directors, Pedro Fontana García, as Chair of the Board Appointments and Corporate Governance Committee, while in parallel he ceased to be a member of the Board Audit and Control Committee, a position he had held since December 2017.

At its meeting of 30 May 2024, the Board of Directors agreed, following a report from the Board Appointments and Corporate Governance Committee, to change the composition of the Board Committees. The changes were made after Ana Colonques García-Planas joined the Board of Directors as Independent Director and after the analysis carried out by the Board Appointments and Corporate Governance Committee of the composition of the Board Committees in order to continuously improve the Institution's corporate governance arrangements.

Ana Colonques García-Planas was appointed voting member of the Board Audit and Control Committee and voting member of the Board Remuneration Committee, given her skills in accounting and auditing, human resources, culture, talent and remuneration, as well as her valuable business experience in these Board Committees. As a result, the presence of women, as the under-represented sex, has increased, as has the age diversity of those occupying the roles.

The composition and number of meetings of these Board Committees as at 31 December 2024 are shown in the table below:

Composition of the Board Committees

	Strategy and		Audit and	Appointments & Corporate
Position	Sustainability	Delegated Credit	Control	Governance	Remuneration	Risk
Chair	Josep Oliu	Pedro Fontana	Manuel Valls	Pedro Fontana	Mireya	George Donald
	Creus	García	Morató	García	Giné Torrens	Johnston III
Voting member	Lluís Deulofeu	Lluís Deulofeu	Ana Colonques	Aurora Catá	Ana Colonques	Aurora Catá
	Fuguet	Fuguet	García-Planas	Sala	García-Planas	Sala
Voting member	Pedro Fontana	César González-	Laura González	María José	Laura González	Alicia Reyes
	García	Bueno Mayer	Molero	García Beato	Molero	Revuelta
Voting member	María José	Alicia Reyes	Pedro Viñolas	Mireya		Manuel Valls
	García Beato	Revuelta	Serra	Giné Torrens		Morató
Voting member	César González-	Pedro Viñolas
	Bueno Mayer (*)	Serra
Voting member	George Donald
	Johnston III
Secretary	Miquel Roca	Gonzalo Barettino	Miquel Roca	Miquel Roca	Gonzalo Barettino	Gonzalo Barettino
Non-voting member	i Junyent	Coloma	i Junyent	i Junyent	Coloma	Coloma
Meetings in 2024	15	35	11	13	12	11

(*) Member for matters of strategy only.

Board Strategy and Sustainability Committee

The Board Strategy and Sustainability Committee was set up in 2021 and is formed of five Directors: three Independent, one Other External and its Chair (in the capacity of Other External Director), who is the Chairman of the Board of Directors. On matters of strategy, the Chief Executive Officer takes part in the meetings, with full voting and speaking privileges, meaning that on such matters this Board Committee has six members.

With regard to strategy, the Board Committee's main responsibilities are to evaluate and propose strategies to the Board of Directors for the Company's business growth, development, diversification and/or transformation, and to report to and advise the Board of Directors on matters related to the Company's long-term strategy, identifying new opportunities to create value and bringing corporate strategy proposals to the Board's attention in relation to new investment or divestment opportunities, financial transactions with a material accounting impact, and significant technological transformations. It is also responsible for studying and putting forward recommendations and improvements to the strategic plans and their updates which may be brought before the Board at any time, and for issuing and submitting a report to the Board on an annual basis containing the proposals, assessments, studies and work carried out during the year.

With regard to sustainability, the Board Committee has the following responsibilities: review the Institution's sustainability and environmental policies; report to the Board of Directors on potential modifications and regular updates of the sustainability strategy; review the definition and amendment of the policies on diversity and inclusion, human rights, equal opportunities and work-life balance and periodically evaluate the level of compliance therewith; review the Bank's strategy for social action and its sponsorship and patronage plans; review and give status reports on the Institution's Consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, S.A. and subsidiaries (Sustainability Report), prior to its review and related reporting by the Board Audit and Control Committee and before its subsequent submission to the Board of Directors; and receive information related to reports, documents or communications from external supervisory bodies with regard to the responsibilities of this Board Committee.

Delegated Credit Committee

The Delegated Credit Committee is formed of five Directors: one Executive and four Independent (one of whom is its Chair). Its main duties are to analyse and, where appropriate, resolve credit operations, in accordance with the assumptions and limits established by express delegation of the Board of Directors, and to prepare reports on matters within its area of activity that may be required of it by the Board of Directors. Furthermore, it shall have all the responsibilities ascribed to it by law, the Articles of Association and the Regulation of the Board of Directors.

Board Audit and Control Committee

The Board Audit and Control Committee is formed of four Independent Directors, its Chair being an audit expert. It aims to oversee the effectiveness of the Bank's internal control, internal audit and risk management systems, supervise the process for preparing and disclosing regulated financial information, report on the Bank's annual accounts and interim financial statements, manage relations with statutory auditors, and ensure that appropriate measures are taken in the event of any improper conduct or methods. It also ensures that the measures, policies and strategies defined by the Board of Directors are duly implemented.

Board Appointments and Corporate Governance Committee

The Board Appointments and Corporate Governance Committee is formed of three Independent Directors (one of whom is its Chair) and one Other External Director. Its main duties are to exercise vigilance to ensure a compliant qualitative composition of the Board of Directors, evaluating the suitability and necessary skills and experience of the members of the Board of Directors; escalate proposals for the appointment of Independent Directors; report on proposals for the appointment of the remaining Directors; report on proposals for the appointment and removal of senior executives and members of the Identified Staff; report on the basic terms of the contracts of Executive Directors and senior executives; and examine and organise the succession of the Bank's Chairman of the Board and Chief Executive Officer and, where appropriate, put forward proposals to the Board so that the aforesaid succession may take place in an orderly and planned manner. It should also set a target for representation of the under-represented sex on the Board and produce guidelines on how to achieve that target.

In matters related to corporate governance, it is responsible for informing the Board of Directors of the Company's corporate policies and internal regulations, unless they fall within the remit of other Board Committees; supervising compliance with the Company's corporate governance rules, except for those that fall within the remit of other Board Committees; submitting the Annual Corporate Governance Report to the Board of Directors for its approval and annual publication; supervising, within its sphere of competence, the Company's communications with shareholders and investors, proxy advisors and other stakeholders and reporting to the Board of Directors on these communications; and any other actions that may be necessary to ensure good corporate governance in all of the Company's activities.

Board Remuneration Committee

The Board Remuneration Committee is formed of three Independent Directors. Its main responsibilities are to put forward proposals to the Board of Directors on the remuneration policy for Directors and General Managers, as well as on individual remuneration and other contractual terms of Executive Directors, and to ensure compliance therewith. Additionally, it provides information for the Annual Report on Director Remuneration and reviews the general principles concerning remuneration and the remuneration schemes applicable to all employees, ensuring transparency in remuneration matters.

Board Risk Committee

The Board Risk Committee is formed of four Independent Directors. Its main responsibilities are to supervise and ensure that all risks of the Institution and its consolidated Group are appropriately taken, controlled and managed, and to report to the full Board on the performance of its duties, in accordance with the law, the Articles of Association, the Regulation of the Board of Directors and that of the Board Committee itself.

Chairmanship of the Bank

Article 55 of the Articles of Association stipulates that the Chairman shall perform his duties as a Non-Executive Director. The Chairman is the most senior representative of the Bank and has the rights and obligations inherent in that representation. The Chairman, through the performance of his duties, is ultimately responsible for the effective operation of the Board of Directors and, as such, he represents the Bank in all matters and signs on its behalf, convenes and chairs meetings of the Board of Directors, sets the meeting agenda, leads discussions and deliberations during Board meetings and ensures the fulfilment of the resolutions adopted by the Board of Directors.

Chief Executive Officer

Pursuant to Article 56 of the Articles of Association, the Chief Executive Officer is ultimately responsible for managing and directing the business and will be the Bank's representative in the absence of the Chairman. The Board of Directors shall also delegate to the Chief Executive Officer, on a permanent basis, all the powers that it sees fit from among those that may be legally delegated.

Control units

The Internal Audit division and the Risk Control & Regulation division have access and report directly to the Board of Directors and its Committees, specifically, to the Board Audit and Control Committee and the Board Risk Committee, respectively.

The Bank publishes the Annual Corporate Governance Report (which includes detailed information on the Bank's corporate governance arrangements), the Annual Report on Director Remuneration and the Sustainability Report, which form part of this Directors' Report, on the website of the Spanish National Securities Market Commission (CNMV) and on Banco Sabadell's corporate website www.grupbancsabadell.com.

1.5 Customers

Banco Sabadell has made customer experience a part of each of the Company's strategic forums and each of its decisions related to the design of both the products and services that it offers to its customers.

In a context of lower inflation and the ensuing commencement of interest rate cuts introduced by both the United States Federal Reserve (Fed) and the ECB, and despite the uncertainty of the current geopolitical landscape (war in Ukraine, Israel conflict in the Middle East, presidential elections in the US), Spain's economic performance has been positive, with GDP rising above the EU average, driven by positive developments in the external sector and the good performance of internal demand.

Spanish banks, including Banco Sabadell, have helped to boost the Spanish economy by providing companies and households with cheaper borrowing costs thanks to the lower price of money. This translated into an increase in lending through mortgages and consumer loans granted to individuals and credit granted to companies.

All of these efforts were made whilst upholding Banco Sabadell's values of placing customers at the core every time they interact with the Bank using any of its channels and adapting products to their needs.

Banco Sabadell was the bank that recorded the biggest growth in its main customer experience indicator through the Net Promoter Score (NPS) over the past three years in Retail Banking. It is particularly worth noting that it was the bank most recommended by companies⁵ .

Banco Sabadell has made customer experience a part of each of the Company's strategic forums and each of its decisions related to the design of both the products and services offered to customers. The objective is clear: to offer products and services that can be adapted to customers' needs, through what is called a customer-centric approach, offering a wide range of products for each type of customer and combining this with an omnichannel experience between physical and digital channels.

Knowing customers at every stage of their relationship with Banco Sabadell is crucial, which is why new methodologies have been developed using Artificial Intelligence (AI), allowing the Bank to listen to what customers are saying, to measure and determine the main reasons for customer satisfaction and dissatisfaction and to ascertain how near or far it is from meeting customers' expectations. The ultimate goal is to implement courses of action that make it possible not only to improve customers' experience but to also try to surpass their expectations.

These methodologies make it possible to transform and adapt processes by making them more customer-centric in order to improve the experience of customers.

⁵ According to the survey's last edition of the year (Accenture survey, September-December 2024) for companies with turnover in excess of 2 million euros.

Measuring customer experience

Understanding the behaviours and needs of customers through customer insights is key for Banco Sabadell.

Measuring customer experience involves understanding the market, consumers and customers, using a number of different qualitative and quantitative analytical methodologies to that end.

Qualitative analysis

In order to better understand the environment and the customers within it, different qualitative studies and research projects are undertaken using different methodologies. The aims pursued include:

• Listening carefully, actively and constantly to what customers have to say, so as to ascertain how they experience their relationship with the Bank at different touchpoints.
• Understanding the concerns, worries and attitudes of consumers and their current and future needs.
• Identifying the more emotional and least explicit part of consumer decision-making.
• Defining ad hoc value propositions for each type of customer.

A variety of techniques are used, ranging from conventional in-depth interviews and segment-specific focus groups to more innovative methodologies based on behavioural economics and the detection of the deepest emotions and motivations of consumers. All of them help the Bank to identify the needs of its customers and to innovate by offering them products and services that meet their current expectations.

In 2024, Banco Sabadell secured a position as one of the banks with the best mortgage offers, both fixed-rate and variable-rate, offering one of the most competitive interest rates in the market both for first-time buyers and for those wishing to purchase a second home. All of this was achieved by adapting to the needs of customers, through the offer of inperson support at branches and also through the various remote channels, which this year were the key to enriching the customer experience throughout the process.

2024 was also vital for Banco Sabadell, as it continues to be one of the leading banks when it comes to innovation, having become the first bank in Spain to include the option to finance purchases made using bank cards issued by any institution directly from the dataphone. Thanks to the new InstantCredit application created by Sabadell Consumer Finance, the Group's consumer finance specialist, merchants that have a Banco Sabadell Smart PoS device and which have opted into that service can offer their customers the option to finance their purchases in a quick, secure and 100% digital manner, regardless of whether they are customers of the Bank or not.

Quantitative analysis

Banco Sabadell also analyses the experience of its customers through quantitative studies. Some of these are more closely related to the traditional concept of customer satisfaction, while others incorporate more emotional aspects of customers, to make the organisation more aware of the importance of considering customers in its decision-making, so as to make meaningful improvements.

1. Net Promoter Score (NPS)

The Net Promoter Score (NPS), considered to be the benchmark indicator in the market used to measure customer experience, allows Banco Sabadell to be compared against its peers and even against companies in other sectors, both nationally and internationally.

Banco Sabadell Spain's position in the ranking

Source: Accenture benchmarking of major Spanish financial institutions (2024 data).

In light of the digital transformation, the measurement of customer satisfaction in digital channels has become more important. The mobile app NPS for the Retail segment reached 50% (increase of 6 percentage points compared to 2023), while the telephony channel NPS was 19% (increase of 10 percentage points compared to 2023).

Source: Internal NPS tracking studies, December 2024, 13-week rolling score

The results obtained during 2024 confirm that Banco Sabadell is on the right track. With regard to Banco Sabadell Spain, those results were very positive in relation to customer satisfaction.

Stemming from the focus on always offering the best possible experience to each customer group, one of the Bank's objectives is to continuously improve its NPS, both in terms of Key Performance Indicators (KPIs) and in terms of its position compared to other banks.

2. Satisfaction surveys

The overall customer experience measurement and management model of Banco Sabadell Spain is based on different indicators obtained from around 900,000 surveys and at more than 20 touchpoints. The results of the various surveys allow it to ascertain the level of satisfaction of its customers and to identify areas where specific processes and contact channels could be improved. For each of these surveys and studies, the Bank sets itself improvement targets and continuously monitors progress.

In a multichannel environment, the surveys related to specialised customer service, both in branches and in the digital sphere, are becoming increasingly relevant. For Banco Sabadell, the use of digital channels is a moment of truth, which is why it has focused its efforts on measuring customer satisfaction and improving their experience with online banking for individuals (BSOnline Particulares) and for businesses (BSOnline Empresas), with the mobile app, etc. In particular, it is worth noting the outstanding results of the internal NPS survey, in which both the retail banking segment and the business banking segment improved by 13 percentage points.

3. Branch quality surveys

In addition to analysing customer perceptions, Banco Sabadell also carries out objective studies using approaches such as the mystery shopping technique, where an independent consultant poses as a buyer to assess the quality of service and the commercial approach to potential customers followed by the sales team.

EQUOS RCB (Stiga) is the market benchmark survey that evaluates the quality of service offered by Spanish financial institutions through the mystery shopping technique. Banco Sabadell ranks among the leading players and continues to stand out in terms of quality with respect to the sector.

Level of service quality

Customer Care Service (Servicio de Atención al Cliente, or SAC)

The Customer Care Service of Banco de Sabadell, S.A. conforms to the provisions of Ministry of the Economy Order 734/2004 of 11 March, the guidelines issued by the European Banking Authority (EBA) and the European Securities Market Authority (ESMA), and the Banco Sabadell regulation for the protection of customers and users of financial services. The most recent amendment to that regulation was approved by the Bank of Spain in December 2023.

In accordance with its Terms of Reference, Banco Sabadell's SAC handles and resolves complaints and claims received from customers and users of Banco Sabadell's financial services and those of its associated institutions: Sabadell Asset Management, S.A., S.G.I.I.C. Sociedad Unipersonal, Urquijo Gestión, S.G.I.I.C, S.A. and Sabadell Consumer Finance, S.A.U.

In addition, the SAC can issue recommendations or suggestions derived from the analysis of complaints and claims received by the SAC.

In order to ensure its decision-making autonomy, the SAC is independent of the Bank's operational and business lines and it has the necessary resources to deal appropriately with complaints and claims, under the principles of transparency, independence, effectiveness, coordination, speed and security. The SAC also has sufficient authority to access all the necessary information and documentation in order to

analyse each case, and the operational and business units are obliged to cooperate diligently in this regard. Banco Sabadell's regulation on the protection of customers and users of financial services ensures compliance with the above-mentioned requirements.

In 2024, 104,621 complaints and claims were received: 99,558 processed in the first instance by the SAC, 4,289 through the Customer Ombudsman, 750 through the Bank of Spain and 24 through the CNMV. This year, 105,355 complaints were managed, of which 55,429 were accepted for processing and resolved, 49,740 were not accepted for processing as they did not meet the requirements set in the Regulation, and 186 complaints were pending submission of allegations.

See Note 42 to the consolidated annual financial statements for further details.

Multichannel strategy

During 2024, Banco Sabadell consolidated its multi-channel strategy, mainly by supporting the development of new capabilities in its digital and in-person channels, while various improvements were made in the current digital customer onboarding process. This, together with the launch of the digital onboarding offer for self-employed professionals, cemented Banco Sabadell's position as one of the leading players in terms of onboarding at the domestic level, in a highly competitive environment. All of this made it possible to meet the ambitious targets for newly onboarded customers set by the Group at the start of the year.

In parallel, more intensive action was taken to activate and engage digital customers, focusing heavily on providing customers with what they initially need from the Bank. In addition, powerful campaigns were launched to attract salary and Bizum payments, aimed at digital customers and customers of the branch network, which substantially increased the ratio of salaries paid into customer accounts, as well as the number of customers with Bizum registered with the Institution.

All this was further supported by the consolidation of several teams of specialists in savings & investment and mortgages & insurance, with the aim of helping and advising customers in matters that may require greater specialisation and expertise, thus enabling customers to make the best decisions.

Branch network

The Group ended 2024 with a network of 1,350 branches, representing a reduction of 70 branches with respect to 31 December 2023.

Of the total number of branches and offices in Spain of Banco Sabadell and its Group, 842 operate under the Sabadell brand (including 25 business banking branches and 2 corporate banking branches), 62 operate as SabadellGallego (3 business banking branches), 85 as SabadellHerrero in Asturias and Leon (3 business banking branches), 62 as SabadellGuipuzcoano (5 business banking branches) and 7 as SabadellUrquijo, with a further 81 branches operating under the Solbank brand. The other 211 branches and offices make up the international network, of which 186 correspond to TSB and 12 to Mexico.

Number of branches, by autonomous community

Dubai (UAE)

Istanbul (Turkey)

ATM network

Banco Sabadell ended the year with a fleet of 2,351 ATMs in Spain, including 1,745 in-branch and 606 out-of-branch ATMs. Compared to 2023, the number of ATMs decreased by 5%, mainly due to the sale of out-of-branch ATMs and branch closures.

London (UK)

In terms of ATM transactions carried out in 2024, the downward trend observed during the previous year continued, with approximately 72 million transactions carried out, which is a decrease of approximately 6.7% in the total number of transactions.

Deposits and withdrawals were the most commonly used types of transactions and, in both cases, there was a slight decrease compared to the previous year.

The main goals for 2024 were to improve the overall availability of the fleet, modernise the technology by upgrading around 100 ATMs, thereby complying with the updated European Accessibility Act (Law 11/2023 on the transposition of EU Directives, which transposed Directive 2019/882), enhance customer experience and, above all, review the appearance and cleanliness of ATMs.

Companies Hub (Hub Empresa)

The Companies Hub is Banco Sabadell's centre for business connections, an initiative that reinforces the Bank's position as the banking institution that best understands the challenges of transformation faced by companies and the one that can best help them with that process, showcasing Banco Sabadell's specialisation in the world of business and its close relationship with customers.

The Companies Hub comprises:

• A digital environment with activities organised by the Bank's experts and external professionals. In 2024, 102 activities took place (46 webinars, 48 in-person events live-streamed from the Companies Hub in Valencia, and 8 in-person events streamed from other regions), in which over 15,000 professionals took part. The recordings also had more than 20,000 post-event viewings.
• An important physical space for companies in the heart of Valencia, with workspaces for business meetings. In 2024, 104 activities were held (in-house, co-hosted and third-party events), which more than 4,500 people attended in person. In addition, 3,400 people booked meeting rooms at the Companies Hub in Valencia (897 room bookings) and more than 1,815 external professionals took part in activities organised by business banking customers.

In 2024, it is worth highlighting some events that made it possible to explore other formats, such as the live broadcast of radio programmes and the recording of business podcasts. Similarly, the in-person format that is permanently used in the Companies Hub in Valencia was carried over to other regions, organising five events in Madrid, Barcelona and Seville.

In total, the number of participants this year came to 25,108, and the number of organised in-house activities was 121. Companies continue to rate the activities very highly, with an average overall rating of 9.12 out of 10 (4,135 surveys answered).

The impact of the activities is amplified with the creation of articles or videos that are distributed through the press and social media: 70 summary videos of the activities were created for the Bank's social media and it also collaborated in more than 26 articles and news publications in print and digital media. All of this resulted in 197 news articles being published in media (both print and digital) and 794 mentions in social networks.

All of the activities are designed based on the key thematic areas agreed on by the Editorial Committee which meets at the start of the year. It is worth noting the "Inspiring stories" (Historias inspiradoras) cycle of conferences held with customers such as Olivé Slowfoods, DornaSports (Moto GP), Carmencita and Kampaoh.

We continue to hold cycles of conferences on Next Generation EU funds, Artificial Intelligence, Internationalisation and Sustainability as well as others on current topics such as electronic invoices, pension plans for the self-employed, solutions for the hotel and catering industries and the special DANA cycle related to the assistance measures put in place to help those affected by the flash floods, which attracted a lot of interest.

Direct Branch

During 2024, Direct Branch (DB) contacts decreased by 4.24% compared to those recorded in 2023 and numbered 4.4 million contacts, including phone calls, social media interactions and contacts by email and through the web chat service.

This reduced number of contacts compared to the previous year is due to the drop in the number of phone calls in relation to certain topics in the Servicing Programme (11%), the smaller number of social media interactions (20%) and the reduced use of the email channel (58%).

Of the total number of remote interactions with customers, 89% took place through the telephony channel. Considering the importance of that channel, one of the priorities for 2024 was to boost customer experience through various initiatives aimed at reducing wait times and improving the resolution capacity on first contact, to avoid customers having to visit the branch network.

As regards service levels, the Service Level Agreement (SLA) percentage for telephone enquiries was above 95%, followed by the chat service at 87% and the email channel at 79%.

Also in 2024, Direct Branch carried out a segmentation project between business banking and retail banking customers, to ensure customers receive specialised assistance and enjoy an improved experience on the telephony channel. This new customer service model was completed in November.

In relation to preferential services (SAP and SAPE), in 2024 the volume increased by 65% (65,137 calls) compared to the same period in 2023, reaching an SLA percentage of over 96%. This growth was due to:

• The routing of calls from customers in the Private Banking, Wealth Management and Large Corporates segments who contacted the branch, in order to relieve the branch of these customer service tasks.
• The segmentation of generic telephone helplines and customer identification (by phone or with their tax identification number), so that target customers who had previously contacted the Bank using other services could be correctly rerouted to preferential services.
• The promotion and dissemination of the service by branches and units, thanks to the team's high level of expertise and resolution capacity, particularly in time-critical and high-value cases.

In addition, the following aspects should be noted:

• Digital support for companies: this service, under the responsibility of the SAPE team, includes supporting customers the first time they use online banking features and offering them assistance and troubleshooting when sending files (among others, for reverse factoring, factoring, transfers, and direct debits).
• Corporate Banking and Business Operations Centres (BOCs): the specialist team at SAPE uses specific mailboxes to resolve highly critical cases involving customers in the Large Corporates segment with turnover in excess of 100 million euros.
• Customer Care Space: the first secure text-based customer service channel exclusively for use by business banking customers was set up in October 2023. This channel has been gradually rolled out to more customers and, although the process is still ongoing, in 2024 interactions were up by 137% (5,624 interactions) compared to 2023.

Social media

Banco Sabadell is active on five social media channels: X, Facebook, LinkedIn, YouTube and Instagram, with 20 different profiles at the national level, positioning itself as one of the financial institutions with the best digital reputations in the sector.

One of the most prominent KPIs in global social media ranking reports is the Service Level Agreement (SLA) ratio, at 98%.

Another text-based customer care service that Banco Sabadell offers is its web chat service, which this year recorded a 14% increase in usage by customers compared to 2023. This is further proof of the growing importance of this service as the preferred channel of interaction among our digital customers, a group whose number continues to steadily grow with each passing year.

Among the improvements introduced to this web chat service is the expansion of the chatbot autonomy, to avoid having to divert customers to other channels such as the telephony channel or their local branch. The resolution capacity is expected to continue improving throughout 2025.

Digital transformation and customer experience

In banking, as in many other businesses, the digitalisation of consumer habits is profoundly transforming the sector. Interactions that previously took place in person at branches are now increasingly taking place online. Banco Sabadell Group believes that it is necessary to offer its customers an optimal level of digital services to enable them to do their banking using their mobile device if they wish, while continuing to offer inperson services through its network of branches and specialists when it really matters to its customers. For that reason, in recent years Banco Sabadell Group has made considerable efforts to equip itself with the best possible technological infrastructure, developing a scalable and efficient platform with recognised levels of cybersecurity.

After several years of preparation, developing its technology platform, Banco Sabadell is now better positioned to offer its customers the best digital services. This is reflected in the increased number of digital retail banking customers, which grew by 66.6% in 2024 (an increase of 2.5 percentage points compared to 2023), which translates into 2.6 million customers who contacted the Bank through a digital channel in the last three months of 2024.

It is also worth mentioning other examples of the increased level of digitalisation of customers in other areas:

• Customer acquisition: 54% of new customers acquired through digital channels.
• Issuance of debit cards: 51% through digital self-service channel.
• Loans to retail banking customers: 83% through remote channels.

Digitalisation also opens new avenues for improving processes, making it possible to offer superb customer experience in processes that are currently seen as cumbersome. The Group already has good examples of this, such as the process for requesting certificates, which can be completed from start to finish on the app; the 100% online customer registration process, which is already available for selfemployed customers; and the possibility of applying for a personal loan or a credit card entirely through digital channels.

Sabadell Digital

Sabadell Digital is Banco Sabadell Group's IT subsidiary. Its mission is to develop the best technological solutions to allow the Bank to drive forward its digital transformation. Sabadell Digital's contribution to the Group is based on three principles:

• Focus on customers' needs through proximity and empathy. This makes it possible to deliver the best technological and digital solutions to meet customers' needs.
• Smart innovation, to innovate, adapt to change and challenge the status quo through experience-based decisions.
• Digital talent community as a source of knowledge shared between digital and technology experts, focusing especially on collaboration and mutual trust among the people that make up Sabadell Digital.

Since the creation of Sabadell Digital in 2023, the management of technological and digital talent has been one of the priorities. Thanks to the initiatives introduced in 2023 and 2024, this year Sabadell Digital has been able to attract new digital talent through an ambitious plan, under which 90 new employees joined the workforce in 2024.

Main deliveries in 2024

Digital onboarding

New customers acquired through the digital onboarding process numbered more than 184,000 in 2024 (growth of 7% compared to 2023) and currently represent 54% of the total new customers acquired by the Institution.

The process was improved in 2024, expanding the online application feature to the self-employed segment and allowing those with joint contracts to be digitally onboarded and perform digital banking. Digitally onboarded customers with joint contracts already account for 3% of all newly onboarded customers. Digital onboarding has therefore become a key element for processes to apply for the Institution's other core products, such as mortgages.

In addition, the incorporation of self-employed professionals seeking products, services or accounts for business purposes, which represent approximately 25% of the new customers in this segment in 2024, and the possibility of registering as a customer with new identity documents, such as a passport in the case of foreign residents, has made it possible to access a wider range of potential market segments, with these representing approximately 7% and 10% of newly onboarded customers, respectively.

In the same way, in 2024 the Institution focused on promoting the engagement and activation of these new digital customers. As a result, 36% of customers brought their salary or regular income payments to the Bank, 43% used their debit cards, and 33% linked Bizum, thus boosting transaction numbers and its image as their main bank.

Transformation of the mortgage model

In 2024, the Group continued with the digital transformation of its mortgage model, with two very clear focus areas:

• The customer: focus on optimising and improving the digital process, making it easier and more convenient for customers, making improvements to the stream to increase customer conversion rates.
• The support model: the Group improved efficiency to allow relationship managers to devote their time and effort to value-added tasks for customers.

This year, digital transformation made it possible to increase new mortgage loans granted on digital channels by 100%, but the biggest impact is expected to come through in 2025, with a focus on digitalisation and support from specialists as part of an omnichannel mortgage application process.

Digital loans

Digital loans are one of the main pillars of the sales model transformation in the retail banking customer segment.

Over the past two years, the Bank has made huge efforts to turn digital channels into the main source of consumer loan sales.

From 2022 to the end of 2024, the volume of loans originated digitally increased by almost 223% and the digital conversion rate per single customer was up by over 50%. Total retail loans taken out in remote channels represented more than 83% of the total loans taken out.

This year, the Bank improved the process, broadening its scope and optimising the experience:

• Developing a new process to apply for pre-approved loans with a new bespoke system, substantially improving customer experience and delivering the main improvements proposed by customers in relation to the previous stream.
• Improving the stream for reactive loans, making it a more frictionless process by reducing the number of questions and necessary fields, expanding the perimeter of customers and improving the design.

Servicing Programme

The Servicing Programme aims to offer the best customer experience by giving customers the option to do their banking whenever and wherever they want. The transformation being carried out is having a very material impact on the programme's key indicators:

• Service activities in branches have been reduced by 15%, allowing the branch network to focus on value-added commercial operations.
• Calls to Direct Branch have fallen by 11% thanks to enhanced selfservice digital capabilities. The operational model is more efficient and significant improvements have been made in the daily banking of customers, introducing features that give them greater control over their money, such as the new system to search for specific transactions and the improved identification of purchases through the geolocation of retail outlets.
• Customers' experience with the Banco Sabadell mobile app has significantly improved. The benchmark satisfaction indicator, NPS, went up by 6 basis points from 44% in 2023 to 50% in 2024.

Marketing tools in digital processes

The personalisation of content according to customer profiles in the digital channel is key to conveying a proposed offering that is suitable for each customer, which can improve conversion rates and increase the volume of digital sales. This project promotes the integration of marketing tools on Banco Sabadell's mobile app, enabling the app to show personalised content, segmented by stakeholder groups and geared towards customers' needs, thus improving marketing efficiency and user satisfaction.

The Group is also using marketing tools to optimise its commercial and customer service processes by implementing A/B testing, with continuous improvement forming the foundation of all digital platform developments. Ongoing testing through personalisation tools helps to identify and/or rule out improvements in usability and navigation prior to going live, thus saving time and resources in the process of continuous development.

Evolution of the design system: Galatea

The Bank's design system was further developed and expanded in 2024, with expected savings at the end of the year of 3.9 million euros and 87,000 hours of work. The projects used pre-existing components in 97% of cases, resulting not only in improved efficiency but also in more consistency across digital channels.

Similarly, the functional development of the current design system through tokenisation will make it possible to reuse more components and increase the profitability of the system, as it will allow it to be used in other channels, such as, PoS terminals or ATMs, and in other geographies, such as Mexico.

File management

File management is a key aspect of companies' day-to-day business. Initiatives aimed at improving experience and usability were launched in 2024. Improvements centred on viewing files in both BSOnline and BSMovil and on the generation of files in BSOnline, enhancing transaction banking in digital channels by companies.

Customer Care Space

The Customer Care Space was launched in 2024. It is a text-based customer service channel where self-employed professionals, businesses and corporates can interact with the Bank in a secure and swift manner. Customers can chat to customer care teams through the BSOnline and BSMovil services for business banking customers, or through WhatsApp. They can also exchange documentation, see the contact details of their relationship manager or local branch and book appointments to see them.

Digital applications and services for business banking customers

In 2024, Banco Sabadell expanded its capabilities for digital applications and services to include key products such as business loans, business credit cards, factoring, reverse factoring, pension plans for self-employed professionals and savings/investment products. These new capabilities allow self-employed professionals, businesses and corporates to access the offering of financial products and services on an autonomous basis, which improves user experience and increases the use of digital channels.

1.6. Other information (tender offer)

Voluntary tender offer for the acquisition of shares of Banco Sabadell put forward by Banco Bilbao Vizcaya Argentaria, S.A.

As explained in Note 1.5 to the annual financial statements for 2024, in an Inside Information disclosure dated 30 April 2024, entered in the register of the Spanish National Securities Market Commission (CNMV) under number 2,227, Banco Sabadell confirmed that it had received, on that same day, an indicative written proposal from Banco Bilbao Vizcaya Argentaria, S.A. for a merger (the Proposal). On 6 May 2024, through a separate Inside Information disclosure entered in the CNMV's register under number 2,234, Banco Sabadell submitted a press release on the decisions taken by its Board of Directors on that date, informing that Banco Sabadell, in fulfilment of its duties and with the assistance of financial advisors and a legal advisor, had carefully considered the Proposal and believed that it significantly undervalued the potential of Banco Sabadell and its standalone growth prospects. The press release also stated that the Board of Directors was highly confident in Banco Sabadell's growth strategy and its financial targets and was of the view that Banco Sabadell's standalone strategy would create superior value for its shareholders. Therefore, based on the detailed assessment of the Proposal, the Board of Directors had concluded that it was not in the best interest of Banco Sabadell and its shareholders and had therefore rejected BBVA's Proposal; this decision was, moreover, thought to be aligned with the interest of Banco Sabadell's customers and employees.

Furthermore, as part of its strong commitment to shareholder value creation and supported by the Company's business plan and solid capital generation, the Board of Directors reiterated its commitment to distribute, on an ongoing basis, any excess capital above the 13% CET1 ratio pro forma Basel IV⁶ to its shareholders. The overall excess capital amount to be generated over 2024 and 2025, together with recurrent dividends during this period according to a successful completion of the current business plan, was projected to be 2.4 billion euros, with part of the distribution to shareholders potentially subject to supervisory approval.

In addition, on 8 May 2024, through an Inside Information disclosure entered in the CNMV's register under number 2,240, with regard to the news published in the press on that same day, and to ensure that the market had complete and transparent information in respect thereto, the Bank published the verbatim text of the communication which, without any prior contact or exchange between the parties, was received by the Chairman of the Board of Directors of Banco Sabadell from the Chairman of the Board of Directors of BBVA on 5 May 2024. In that communication, the Chairman of BBVA's Board of Directors stated that, in connection with the terms of the proposed merger, BBVA had no room to improve its economic terms.

On 9 May 2024, BBVA sent the CNMV the prior announcement of a tender offer (the Offer) for the acquisition of all shares issued by Banco Sabadell, conditional upon its acceptance by 50.01% of the share capital of Banco Sabadell (subsequently amended to acceptance of the tender offer for a number of shares that allows BBVA to acquire at least more than half of the effective voting rights of Banco Sabadell, excluding any treasury shares held by Banco Sabadell at that time, which BBVA undertakes to redeem at the bank's first General Meeting of Shareholders

⁶ Basel IV marks the final phase of the Basel III standards.

following the tender offer) further conditional upon approval by the General Shareholders' Meeting of BBVA of the increase of its share capital through the issuance of new ordinary shares with non-cash contributions in an amount sufficient to fully cover the consideration offered, and further conditional upon obtaining authorisation by the National Markets and Competition Commission (CNMC) in Spain and by the Prudential Regulation Authority (PRA) in the United Kingdom. The transaction also requires approval by the CNMV and a statement of nonopposition from the European Central Bank.

On 24 May 2024, BBVA filed an application for authorisation of the tender offer with the CNMV, which was admitted for processing by the latter on 11 June 2024. The aforesaid offer initially consisted of one newly issued BBVA share for every 4.83 shares of Banco Sabadell.

On 1 October 2024, BBVA released an Other Relevant Information disclosure entered in the CNMV's register under number 30,745 announcing the adjustment of the consideration under the tender offer in the terms set forth in section 8 of the prior announcement of the offer, establishing, as from 10 October 2024 and following payment by Banco Sabadell and BBVA of their respective interim cash dividends charged to 2024, an exchange ratio of one newly issued ordinary share of BBVA and 0.29 euros in cash for every 5.0196 ordinary shares of Banco Sabadell that accept the offer.

On 5 July 2024, during the BBVA Extraordinary General Shareholders' Meeting, shareholders approved an increase of its share capital through the issuance of ordinary shares, up to a maximum nominal amount of 551,906,524.05 euros, with non-cash contributions in order to cover the consideration in kind of the voluntary tender offer put forward by BBVA for the acquisition of up to 100% of Banco Sabadell's shares.

In September 2024, BBVA obtained authorisation from the PRA in relation to the acquisition of indirect control over TSB and the ECB's decision not to oppose the takeover of Banco Sabadell.

As at the sign-off date of this consolidated Directors' Report, the tender offer remains pending receipt of regulatory authorisation from the CNMC (which on 12 November 2024 announced that its concentration analysis was moving to phase 2) and from the CNMV. It also remains pending acceptance of the offer by a number of shares a number of shares that allows BBVA to acquire at least more than half of the effective voting rights of Banco Sabadell at the end of the offer acceptance period (therefore excluding any treasury shares held by Banco Sabadell at that time), in accordance with the amended offer released by BBVA on 9 January 2025 through an Inside Information disclosure entered in the CNMV's register under number 2,544.

For as long as the tender offer remains pending, it will generate uncertainty for the Group, which is inherent in the very nature of the offer put forward. At the present time, there can be no certainty as to the duration of the regulatory review process or of how long it will take for the tender offer to be authorised, nor of the ultimate outcome of the tender offer, if approved.

Economic, sectoral and regulatory environment

Financial sector environment

Vision for 2025

Economic, sectoral and regulatory environment

2.1 Economic and financial environment

2024 was once again marked by a difference in growth between the United States and the Eurozone.

2024 was a year characterised, in economic terms, by an acute contrast between the economic performance of the United States, which was better than initially expected, and that of the Eurozone, which was weighed down by high political uncertainty in France and weak activity in Germany, which recorded a slight contraction for the second year in a row. Spain, for its part, continued to perform well and ended the year with growth above 3%.

Inflation continued moving towards central banks' targets during the year, although the services component showed some stickiness and remained relatively high. Central banks gained confidence about inflation moderation and at the mid-year mark started to cut official interest rates. In spite of this, they were cautious about the future evolution of interest rates.

2024 was also a year marked by political and geopolitical events. In the Middle East, the conflict between Israel and Iran escalated on several occasions and, in general, the situation in the region got gradually worse as the year progressed, with the involvement of several regional players such as Iran and the armed militia Hezbollah in Lebanon. In terms of domestic politics, more than 70 countries (the equivalent of around half of the world's population) held elections during 2024. Most notably, the United States held its presidential elections, with Donald Trump returning to the White House, which opens a new source of uncertainty akin to what happened during his first term. The elections held in France and Mexico also added to the political noise.

Lastly, in relation to the financial markets, 2024 was once again a positive year, particularly for risk assets. The various episodes of a geopolitical or financial nature (such as the summer disruption due to the reversal of carry trade positions in yen) only caused isolated instability, which subsequently faded away.

Political and geopolitical environment

Geopolitical events were still a source of uncertainty for the markets and the global economy in 2024. First, the conflict in the Middle East, which broke out with Hamas' attack on Israel in October 2023, escalated regionally throughout 2024. Against this backdrop, Israel and Iran exchanged direct attacks on their respective territories, something that had not happened until now. As a result, risks mounted, despite the fact that there were no disruptions to the flow of oil and gas coming from the Middle East nor significant consequences for these markets.

Geopolitical events and the domestic policy of several countries remained a focus of attention during the year.

Second, the conflict in Ukraine continued. Although Russia's advances in eastern Ukraine were limited, Russian attacks knocked out much of Ukraine's energy infrastructure, while Ukraine responded with attacks on oil refineries on Russian territory. The G7 continued to provide financial support to Ukraine, but pressures in the West to move towards ending the conflict mounted.

Third, strategies to reduce trade reliance on China continued on both sides of the Atlantic. The United States kept setting limits on trade with China and technology transfers to this country, while Europe joined in by approving additional tariffs on imports of electric vehicles from the Asian giant. China responded by adopting retaliatory measures against Europe, affecting specific sectors.

Meanwhile, domestic politics was also a significant focus point during 2024 in several countries. In the United States, Donald Trump won the presidential elections, creating a new source of uncertainty as a result of his aggressive stance on foreign trade and immigration.

In France, the political noise was very high. Following the snap elections, Parliament was divided into practically three blocs, with no political force achieving an absolute majority. After tough negotiations, an executive branch led by Barnier was formed. His term abruptly ended a few months later, after the opposition tabled a motion of censure. Macron then appointed the liberal Bayrou as the new prime minister, who formed a new government whose main task will be to draw up a budget for 2025.

In Mexico, the internal political noise led to a deteriorated economic outlook for the country. The elections that took place in June resulted in a reinvigorated government with a qualified majority in the parliamentary chambers and with the desire to implement reforms that are viewed negatively by investors and that could lead to negative actions by credit rating agencies, especially if fiscal discipline were to come into question.

Economic activity and inflation

During 2024, the global economy saw a pronounced difference between the momentum of the United States' economy, which performed better than expected, and the economy of the Eurozone, which was particularly weighed down by Germany's weakness. Spain continued to outperform other Eurozone countries, while China continued to be affected by the impact of its real estate sector adjustment.

Inflation continued moving towards central banks' targets in 2024.

In the Eurozone, activity continued to show signs of weakness in an environment of restrictive interest rates, and in which Germany continued to experience significant weaknesses stemming from the energy shock and greater competition from China. This is dragging its exports and its industrial sector, particularly the automotive industry and the most electrointensive sectors.

The European periphery, on the other hand, showed increased momentum, driven by the strong recovery of the tourism industry and the injection of the Next Generation European Union (NGEU) funds.

As for taxation, the European Union (EU) opened an excessive deficit procedure against France and Italy for breaching fiscal rules. Both countries have high public deficits, and the expectation is that their public debt will increase in the coming years.

In the United Kingdom, activity was somewhat more dynamic than in 2023. Household confidence regained ground thanks to more contained inflation. Lower interest rates led to a strong performance of the real estate sector, which built up gradually during the year, recording house price increases and a rebound in the number of transactions.

In the United States, activity was robust. GDP continued to climb at high rates despite a still restrictive monetary policy. The labour market remained resilient, although it showed some signs of a slowdown. The unemployment rate, despite having increased slightly compared to 2023, remained near the record low.

Evolution of the economic growth forecast for 2024 between the Eurozone and the United States

Spain's economy continued to stand out in a positive light in the Eurozone.

Spain continued to outperform other Eurozone countries, with high levels of growth that surprised to the upside and with continuous upward revisions of growth forecasts by the consensus and various institutions. The composition of growth was favourable, with private consumption and tourism exports standing out, which benefited from greater geographical and seasonal diversification. Lending, on the other hand, was less dynamic.

In the labour market, job creation continued to increase at a robust rate with employment levels reaching a new all-time high, while business confidence in both the services and manufacturing sectors continued to rise throughout practically the whole year, despite the aftermath of DANA, which affected the province of Valencia, among other regions.

Growth in Spain was underpinned by several factors such as significant flows of immigration, the recovery of real incomes, the good financial situation of households and businesses, interest rate cuts and the ongoing injection of NGEU funds.

GDP growth of Spain vs Eurozone

(quarterly variation, %) Source: Eurostat.

Total number of people employed in Spain (in millions).

Source: Spanish Office for National Statistics (Instituto Nacional de Estadística, or INE)

In the area of economic policy, a number of actions were taken, including (i) the mobilisation by the government of 40 billion euros under the recovery plan addendum to be channelled into five funds through a variety of financial instruments, such as second-floor facilities with financial institutions, direct loans and equity investments in certain companies, (ii) the approval of a deal between the Official Credit Institute (ICO) and the government under which the ICO will give guarantees of 2 billion euros for the development of homes to be rented out under affordable housing schemes, (iii) the extension of the VAT cut on certain food products until September and its partial recovery in October, (iv) the unemployment benefit reform to increase its amount and make it compatible with work, (v) the submission to the European Commission of the Fiscal Structural Plan for the 2025-2028 period, in which deficit targets in line with the new European fiscal rules were set out, and (vi) several aid packages aimed at mitigating the economic impact of the DANA emergency.

In Mexico, activity was subdued, clearly losing traction against the pace of growth seen in 2022 and 2023. Economic growth was weighed down by the drawn-out restrictive monetary policy and domestic and foreign political uncertainty.

Beyond Mexico, the emerging economies, in general, continued to show resilience, despite the high interest rate environment at a global level. Greater trade fragmentation and global investment helped these countries. The less restrictive monetary policy was also a support factor, as some emerging countries began cutting official interest rates before developed countries. This resilience was felt despite the economic downturn in China, due to the tighter adjustment to the real estate sector. As a result, at the end of September, the Chinese authorities announced a package of wide-ranging stimulus policies aimed at containing the decline of the real estate sector and boosting household confidence, all with the aim of stabilising the economy.

Inflation in the main developed economies moved closer towards the targets set by central banks during 2024, although the services component continued to be sticky.

In the Eurozone, inflation continued to ease, with the year-on-year rate falling below the 2.0% target for the first time since mid-2021, thanks mainly to the energy component. In any event, inflation in the services sector remained at historically high levels.

In the United Kingdom, headline inflation receded to almost target levels, due to a correction in energy prices, fuels in particular. Core inflation improved somewhat, although it still shows signs of stickiness, especially in the services sector.

In the United States, inflation continued to gradually cool off, with headline inflation close to the target and core inflation somewhat above. Broken down by components, pressure on services eased off in the last few months of the year, but housing continued to drive prices up, while goods and energy contributed favourably to falling inflation. Similarly, the disinflationary process continued in Mexico, although the services component was somewhat sticky.

In Spain, prices were underpinned by persistent services inflation, especially those related to the tourism industry. This was compounded in the first half of the year by the rapid acceleration of energy prices, due to base effects stemming from tax changes in the price of electricity and some rebound of fuel prices. From June onwards, inflation started to moderate, driven by lower prices of energy and certain food items, standing at 1.7% year-on-year in September. Thereafter, inflation rebounded to 2.8% in December due to, among other factors, the base effect of energy prices. The inflation figure for the entire year stood at 2.9%, down from 3.4% in 2023.

House price growth continued to show strong momentum, accelerating its pace to levels above 8% year-on-year on the back of rising demand and relatively tight supply.

HICP for Spain vs Eurozone (year-on-year change in %) Source: Eurostat.

Monetary policy

During 2024, the central banks of developed countries embarked upon a series of interest cuts in a context of more moderate inflation.

Central banks began cutting official interest rates in the middle of the year.

In the Eurozone, the European Central Bank (ECB) launched its series of cuts in June and set the deposit rate at 3.00% (down from 4.00%) amidst economic weakness and with inflation close to its target. Meanwhile, the ECB sped up the reduction of asset holdings by ceasing to reinvest maturities under its Pandemic Emergency Purchase Programme (PEPP). Moreover, banks repaid all the liquidity injected through TLTRO III refinancing operations.

In the United States, the Federal Reserve (Fed) reduced the target range of the Fed funds rate by 100 basis points to 4.25-4.50%, in a context in which the central bank observed cooling in the labour market and was more confident that inflation is nearing the 2% target. It also signalled that inflationary risks had become broadly balanced. Going forward, the central bank indicated that it will maintain a data-dependent stance and that the series of cuts will be staggered.

In the United Kingdom, the Bank of England (BoE) began bringing down interest rates, slashing the base rate by 25 basis points in August and November to 4.75%. The central bank appeared in favour of gradually reducing interest rates, with a meeting-by-meeting approach, and it reiterated its message that monetary policy will need to remain restrictive for long enough to allow inflation risks to dissipate. On the topic of balance sheet policies, a decision was made to reduce the BoE's bond holdings by 100 billion pounds over the coming year, in line with the previous two years.

In Mexico, the central bank commenced a series of cuts to the policy rate in the first quarter of the year carrying out five cuts during the year of 25 basis points to the policy rate, which stood at 10.00%. Furthermore, Banxico left the door open to potentially greater cuts in the future. Banxico acknowledged the progress made with disinflation, though it still considered that inflation risks were tilted to the upside, and it expressed concern over weak activity, considering that the balance of risk was weighted to the downside.

Meanwhile, other Latin American countries, such as Colombia, Chile, Peru and Brazil, remained on the path of interest rate cuts embarked on in 2023, but were more cautious in the second half of the year. In Brazil in particular, fiscal noise and worsening inflation expectations led the central bank to reassess its cuts trajectory and, in September, it started to hike interest rates, becoming the only central bank in the region to raise official interest rates. The Brazilian central bank carried out three consecutive hikes of 175 basis points in total, to 12.25%, and anticipated further hikes during its next two meetings. In Turkey, the central bank continued the aggressive path of monetary policy tightening that it began in June 2023, taking the official rate to 50% in March 2024, holding it at this level almost all year long on the back of double-digit inflation. In December, the Turkish central bank cut the policy rate by 250 basis points to 47.50% in view of the improved inflationary outlook. Meanwhile, the Chinese authorities adopted monetary easing measures to support the economic recovery.

Financial markets

2024 was another positive year for the financial markets, especially for risk assets.

Financial markets once again performed well in 2024, building up from last year's positive performance. Risk assets rose in an environment in which the United States' economy was resilient, the disinflationary trend in the main developed economies was confirmed, and the central banks began their respective interest rate cuts. Various stock market indices reached new record highs driven by the good performance of tech stocks on the back of the development of generative AI. Meanwhile, spreads on corporate bonds and periphery public debt premiums remained very contained. Government bond yields of developed countries, for their part, saw several swings during the year, in an environment in which the markets gradually adjusted their official rate cuts expectations. Finally, the euro ended the year with a strong depreciation against the dollar, impacted by differences in monetary policy between the Eurozone and the United States and, above all, the victory of Donald Trump in the US presidential elections.

Yields on long-term government bonds ended the year at levels above those of 2023 year-end on both sides of the Atlantic, although with clear signs of volatility during the year as the market progressively adjusted its policy rate expectations.

The risk premiums on peripheral sovereign debt stood at levels lower than those seen at the end of 2023, underpinned by credit rating agencies' positive actions, healthy activity data, the ECB's emergency programmes and the disbursement of the NGEU funds.

Meanwhile, France's risk premium rebounded significantly in the face of considerable political uncertainty, the poor shape of its public finances and the negative actions of credit rating agencies.

As regards the currencies of developed countries, the price of the dollar during most of the year ranged between 1.06-1.12 USD/EUR, mainly driven by changes in short-term interest rate spreads. Following Trump's victory during the US presidential elections, the parity broke out of this range and ended the year at 1.04 USD/EUR, a level not seen since 2022. The pound sterling, in its currency pair against the euro, appreciated thanks to the BoE's more tension-ridden stance compared to the ECB's.

USD/EUR Source: Refinitiv.

Equity markets performed very well. Most stock market indices rose remarkably. For example, the Stoxx 600 increased 6% year-on-year, while the IBEX 35 managed to post a gain of almost 15%. Stock market increases were especially significant in the United States, above all in the case of tech companies (the S&P 500 and the Nasdaq managed to gain over 20%).

In the emerging countries, sovereign risk premiums rose slightly, in an environment in which tax risks continued to attract attention in countries such as Brazil and Colombia and in which political uncertainty increased in Mexico. This, compounded by falling oil prices and the result of the elections in the United States, also weighed on these countries' currencies. Moreover, uncertainty regarding Trump's agenda weighed negatively on the yuan, despite the shift to a more expansionary economic policy announced by the Chinese authorities towards the end of the year. To the contrary, Turkey did see its risk premium decrease on the back of the implementation of more orthodox policies. Long-term domestic government bond yields, in general, shifted upwards over the year, the main exception being China, where bond yields were dragged down by signs of economic unrest and expected interest rate cuts.

Crypto-asset markets, for their part, gained strong momentum at the beginning of the year with the approval and issuance in the United States of ETFs that invest in spot bitcoin. These products attracted a lot of interest from institutional investors, and from the end of July, ETFs that invest in spot Ethereum were also approved and issued. All of this combined with the bitcoin halving at the end of April (a process that occurs every four years, whereby the reward miners receive for mining bitcoin in the blockchain is cut in half) and Donald Trump's victory after a favourable electoral campaign for the crypto ecosystem contributed to the price of bitcoin rising against the dollar to new record highs, in excess of 100 thousand dollars. The valuation of the crypto market as a whole exceeded 3.7 trillion dollars in December, which is an all-time high.

2.2 Financial sector environment

Banking sector

The banking industry recorded higher profitability thanks to improved net interest income and fee and commission income.

Risks to the banking industry associated with the Commercial Real Estate (CRE) sector materialised in the first half of the year. CRE is undergoing an adjustment process compounded by rising interest rates. Several banks recognised losses associated with the exposure of the offices segment, increased the provisions of CRE loans and adopted various measures. The situation of New York Community Bancorp (NYCB), an American regional bank, revived fears of the March 2023 episode of bank stress. The negative events related to NYCB were due to loss recognition and increased provisions associated with the offices segment, as well as higher regulatory requirements as a result of its larger size after buying Signature Bank (one of the banks that collapsed in 2023). Some other regional banks were affected, but the situation remained contained. In Europe, several small-sized German banks specialised in the real estate sector, such as Deutsche Pfandbriefbank and Aareal Bank, reported exposure to both domestic and United States CRE. The banks of other countries such as Japan, Sweden and Switzerland also took actions to combat the deteriorated CRE sector in the United States and Europe. Authorities were not forced to take measures as during the episode that affected the banking industry in 2023, but they did intensify their communication policy and stated that risk concentration was high in some banks and in the non-bank financial sector.

Despite these events, the banks' overall situation continued to improve in 2024, buoyed by a favourable economic environment and still high interest rates. The capital ratio increased in the banks of the main developed economies, which, according to the authorities, would be capable of facing an adverse scenario. Banks' profitability continued to be resilient, while the cost of funding for banks became more expensive. The repayment of the liquidity associated with TLTRO III did not have a significant impact on European banks' regulatory liquidity ratios. Asset quality remained strong, but showed some signs of deterioration in the European Union, especially in Germany. In general, the conditions applicable to bank loans in the main developed economies eased gradually during the year, as the central banks implemented interest rate cuts.

As for the Spanish banking sector, the landscape continued to be favourable, with high profitability above the cost of capital (between 8% and 11%, according to the Bank of Spain), driven by the positive evolution of net interest income and net fees and commissions. The solvency position of Spanish banks, measured by the CET1 ratio, continued to be below the European average. The average cost of interest on deposits continued to rise in the first half of 2024. Subsequently, the cost of interest on business deposits began to decrease while the cost of interest on retail deposits remained stable. The liquidity position of Spanish banks continued to be comfortable, despite the TLTRO III repayments to the ECB, which in turn increased the amount of collateral available for banks.

The banking supervisor of the Eurozone, the Single Supervisory Mechanism (SSM), included geopolitical risks more explicitly in its supervisory priorities for the 2025-2027 period, focusing particularly on how banks must manage these risks. On the other hand, the entry into force of Basel III had several setbacks. In the European Union, the regulation will apply in general as from 2025, although some rules have been delayed to 2026. In the United Kingdom, its implementation has been delayed again to 1 January 2027 to allow for more time to gain clarity on the United States' plan, where Trump's presidency may entail a new wave of financial deregulation and, consequently, there are increasing doubts as regards the implementation of Basel III.

During most of 2024, there was lingering uncertainty regarding the introduction of fiscal measures on the banking sector in several countries, in order to increase government revenue collection. As for matters of taxation, the case of Spain is noteworthy. The country created a new bank tax that replaced the temporary levy of credit institutions and financial credit establishments, albeit changing its configuration in certain aspects, such as the elimination of the 800 million threshold corresponding to 2019 and the establishment of a progressive tax scale of between 1% and 7%. Revenues from this tax will be distributed among the autonomous communities according to the size of their GDP. According to the Bank of Spain's financial stability report published in autumn 2024, the extraordinary bank levy decreased the Return on Equity (RoE) by 0.6 percentage points to 13.9% as at June 2024. On the other hand, the ECB, in its report dated 17 December 2024, reiterated the need to constantly monitor the implications of the new tax from a financial stability standpoint, recommending a deep dive into its impact on profitability and the capital base over the longer term, access to loans, the potential impact on liquidity, the granting of new loans and competition in the market.

Financial stability and macroprudential policy

Throughout 2024, the financial authorities deemed that the risks associated with global financial stability had moderated. The main concerns revolved around financial and geopolitical factors, while strictly macroeconomic concerns started to fade away. The main vulnerabilities mentioned by the authorities were the propagation of shocks from the non-bank financial sector, how the CRE sector is going to evolve, the accumulation of public and private debt, the increase in the sovereignbank link, the surge of private credit and cyber-risks.

In Europe, several countries implemented a restrictive macroprudential policy. In Spain, the Bank of Spain activated the countercyclical buffer (CCyB), placing it at 0.5% as from 1 October 2025. The second increase to the CCyB, to 1% in October 2026, is pending confirmation in a new decision at the end of 2025. The Bank of Spain put out the methodological framework for setting the CCyB for public consultation, which establishes a level of 1% when cyclical systemic risks are at a standard level. The authority estimated that a CCyB of 1% decreases the CET1 capital ratio of Spanish banks by 0.4-0.5 percentage points. The Bank of Portugal took a similar measure to Spain, by increasing the CCyB to 0.75% and reviewing the methodological framework for setting the CCyB. In addition, it activated a sectoral systemic risk buffer on residential mortgage exposures of 4% from October 2024. Italy also opted to establish a systemic risk buffer of 0.5% as from January 2025 and of 1% as from July 2025. The Bank of Spain decided to reciprocate the activation of these macroprudential buffers in Portugal and Italy, which affected Spanish banks with exposures in these countries.

Banking Union and Capital Markets Union

In terms of European integration, some notable progress was made, and the number of proposals relevant to the European agenda increased following the formation of the new European Parliament.

Regarding the Banking Union, the European Parliament's Committee on Economic and Monetary Affairs approved the proposal of a draft regulation establishing the first phase of the European Deposit Insurance Scheme (EDIS I). In this phase, the national Deposit Guarantee Schemes (DGSs) will still be needed to deal with possible bank resolutions. At the same time, they agreed to prioritise gradually building up the European Deposit Insurance Fund (DIF), through contributions from the various national DGSs. In addition, progress was made on the negotiations on the crisis management framework for medium-sized banks (Crisis Management and Deposit Insurance, or CMDI), the final approval of which will depend on the final agreements of the trilogues. Another initiative adopted by the European Parliament was the package of measures against money laundering, which includes the creation of the European Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA).

Furthermore, the Enrico Letta and Mario Draghi reports were published. These reports advocated for a deployment of the Capital Markets Union (CMU), rebranded as the Savings and Investments Union (SIU). They also made a series of proposals, notably including the need to reform the securitisation markets, boost European savings with tax incentives, improve European pension schemes and transform the European Securities and Markets Authority (ESMA), giving it more power and centralising the supervision of the most systemic agents of the financial market.

Challenges for the banking industry

Sustainability was still one of the focal points of financial authorities, despite the fact that the US and European election results were not favourable to advancing the green transition. Financial authorities' increased focus on matters related to protecting the environment and biodiversity was also noteworthy.

In the United States, the Fed published the first climate-related scenario analysis, which studied the impacts on the probability of default of loans to enterprises and households based on the exposures of the six main banks. Just like similar exercises in other jurisdictions, it had no implications for capital or banks' supervision.

Europe approved practically all pending regulations, so that in 2025 new reporting and transparency requirements will come into effect. The European Banking Authority (EBA) showed concern over the impact of greenwashing on reputational and operational risks and recommended that banks introduce a series of improvements in the area of governance, data and reporting. Furthermore, in 2024, European banks started to publish their green asset ratio that ranged between 2% and 10% depending on the bank, which are levels below those estimated by the EBA. The ratio was criticised for its design.

For its part, the ECB published its climate and nature plan 2024-2025 and climate risks continued to be one of the supervisory priorities of the SSM in 2024. As a result of a lack of climate stress tests by supervisors during 2024, the ECB concluded that companies that are more engaged in the green transition benefit from lower interest rates when searching for bank loans. The ECB's lending survey also showed that climate change, especially physical risks, contributed to toughening lending conditions for the most polluting companies.

As regards the measures to be adopted to tackle the financial risks stemming from climate change, the European Systemic Risk Board (ESRB) advocated for complementarity between micro- and macroprudential policies, so that these do not entail more requirements for banks.

At the financial industry level, the Glasgow Financial Alliance for Net Zero, the leading financial services sector coalition, announced changes to its organisation as several large US banks started to leave the alliance. Pressure from the US Republican Party on this coalition in recent months has been compounded by the Trump presidency, who is opposed to the fight against climate change.

Digitalisation processes in the financial sector continued at an increasingly fast pace, giving rise to several focus areas. On the one hand, the trend seen in previous years regarding the advance of Big Tech in the financial services sector continued. The banking sector kept making calls for regulations that adhere to the principle of "same activity, same risk, same regulation". On the other hand, the proliferation of cyberattacks, which are becoming more frequent and more severe, also continues to cause concern. With regard to cyber-risk, it was noteworthy that the ECB carried out its first cyber resilience stress test and concluded that, in general, banks have response and recovery frameworks in place, although it recommended some areas for improvement.

As regards regulations for digitalisation, the Markets in Crypto-Assets (MiCA) regulation was phased in but will not be fully implemented until 2025. Several financial institutions have announced the launch of new services related to crypto-assets once this regulation has been fully implemented.

The authorities in the United Kingdom also made progress in these matters, albeit rather more slowly. In the United States, legislative proposals to regulate these markets did not make any progress, but the federal agencies continued to put regulatory pressure on the main cryptoasset exchanges and, in numerous cases, began legal proceedings against these entities. The Basel Committee, for its part, published the final draft of the disclosure framework for banks' exposures to cryptoassets and amendments to its standard on their prudential treatment in July. Banks will have to apply these two standards to their crypto-asset exposures starting on 1 January 2026.

With regard to central banks' digital currencies, these plans continue to be implemented. In particular, the digital euro project made progress in 2024. The ECB carried on with the preparation phase, which started in autumn 2023 and is scheduled to last two years. This phase includes finalisation of the rules of operation and the selection of service providers that could develop the platform and infrastructure. Meanwhile, the European Commission brought back the proposed regulatory framework for the digital euro that began with the previous administration.

China continued to move forward with the digital yuan, expanding its use, albeit with some challenges. The United Kingdom continued to work on a potential digital pound, but its project is progressing more slowly than that of the digital euro. Meanwhile, the United States kept its digital dollar project on the back burner and with Trump's victory it became even more unlikely. Furthermore, the United States Congress approved a law that requires the Federal Reserve to obtain parliamentary approval before issuing the digital dollar.

Meaningful progress also continued to be made in experimenting with the possibilities of interoperability between digital currencies of different central banks and tokenised deposits of commercial banks, including Project Agorá led by the Bank for International Settlements (BIS) that began this year. In parallel, the BIS and the International Monetary Fund (IMF) kept pushing for the development of public financial infrastructures in Distributed Ledger Technology (DLT), under rules to be established by the central banks, and the tokenisation of traditional financial assets.

2.3 Vision for 2025

Global economic growth in 2025 is expected to be impacted by uncertainty and Trump's protectionist policies. Trump's arrival at the White House compounds other dragging structural factors that a, including the following: (i) the turbulent geopolitical environment and its consequences on international trade and value chains, (ii) structural weaknesses of economies such as China, Germany and Italy, and (iii) the fiscal situation of some large developed economies, especially the United States, France and Italy. In Mexico, growth may be below that of the last three years, negatively affected by restrictive monetary policy, uncertainty over constitutional reforms, the T-MEC review and the fiscal adjustment that the government must implement.

The geopolitical environment is expected to become more complicated with Trump's arrival. Trump is expected to impose tariffs on the United States' trade partners, especially China. He would seek to negotiate measures with the Chinese authorities that benefit the US economy. Thus, uncertainty and a trend towards greater protectionism in several regions would mount. Preference for reducing external dependence and improving autonomy in strategic sectors (e.g. technology) could also be a factor in favour of adopting protectionist policies. Moreover, Trump's isolationist policy undermines major multilateral consensus, accentuating a lack of international cooperation in different areas (in addition to international trade, also in climate, technology regulation, cybersecurity, etc.).

The volatile and erratic nature of inflation is expected to be accentuated by new supply shocks (new tariffs, more volatile energy prices, reconfiguration of production chains, convulsive geopolitics, climate shocks, etc.) and an expansionary fiscal policy. In the Eurozone, inflation could be somewhat below the target due to economic weakness in the region. In the United States on the other hand, inflation is expected to remain somewhat above central banks' targets and to swing within wider ranges.

In terms of economic policy, the monetary policy gap between the United States and the Eurozone is expected to widen. The Federal Reserve might be more cautious with its monetary policy, and the target interest rate is forecast to remain at relatively high levels amidst more erratic fiscal policy, sustained growth and higher inflation. The ECB is expected to cut the policy rate below monetary neutrality, in response to a scenario of greater deterioration in activity. In the medium term, it is expected to maintain the policy rate around the estimates of monetary neutrality due to the rising risk of inflation.

In relation to the financial markets, yields on long-term government bonds are expected to remain at relatively high levels, due to a higher term premium on the back of volatility in growth and inflation figures and high sovereign financing needs, among other factors. Sovereign debt risk premiums in the European periphery might remain at contained levels and in line with their respective ratings.

On the currency market, the dollar is expected to show further strength, due to the widening of the pro-US rate differential, the improved performance of the US economy and the uncertainty caused by political and geopolitical risks.

In Spain, the economy is expected to continue to grow above its potential in the first years of the forecast horizon and to show more momentum than in the Eurozone. After a period in which the external sector has played a prominent role, domestic demand may take on a bigger role. Activity will be underpinned by the increase in population (a consequence of migration), the favourable evolution of the labour market, the absence of imbalances in private agents' balance sheets and in the

external sector, lower interest rates and a greater rollout of NGEU funds. The rating of Spanish government bonds is estimated to remain in the A-/ A range, in an environment in which public debt will still remain at high levels. This will contribute to the risk premium remaining at contained levels.

Within the financial environment, the profitability of the banking industry is forecast to remain resilient amidst the reactivation of credit and containment of delinquency rates. The capital and liquidity position is expected to remain robust. The entry into force of Basel III, the management of geopolitical risks, the implementation of new digital regulations (Digital Operational Resilience Act, or DORA, and MiCA), ESG matters, cyber threats, the impact of potential adjustments to the non-bank financial sector and the adjustment of commercial real estate will be areas to focus on.

• Key figures in 2024
• Profit/(loss) for the year
• Balance sheet
• Liquidity management
• Capital management

Financial information

3.1 Key figures in 2024

The Group's main figures, which include financial and non-financial indicators that are key to determine the direction in which the Group is moving, are set out here below:

		2024	2023	Year-on-year change (%)
Income statement (million euro)	(A)
Net interest income		5,021	4,723	6.3
Gross income		6,337	5,862	8.1
Pre-provisions income		3,254	2,847	14.3
Profit attributable to the Group		1,827	1,332	37.1
Balance sheet (million euro)	(B)
Total assets		239,598	235,173	1.9
Gross performing loans		156,913	149,798	4.7
Gross loans to customers		161,717	155,459	4.0
On-balance sheet customer funds		169,557	160,888	5.4
Off-balance sheet funds		46,171	40,561	13.8
Total customer funds		215,729	201,449	7.1
Funds under management and third-party funds		243,431	226,682	7.4
Equity		15,033	13,879	8.3
Shareholders' equity		15,389	14,344	7.3
Profitability and efficiency (%)	(C)
ROA		0.76	0.54
RORWA		2.29	1.70
ROE		12.40	9.49
ROTE		14.93	11.50
Cost-to income with amortisation/depreciation		48.66	51.44
Risk management	(D)
Stage 3 exposures (million euro)		4,844	5,777	(16.2)
Non-performing assets (million euro)		5,680	6,748	(15.8)
NPL ratio (%)		2.84	3.52
Stage 3 coverage ratio, with total provisions (%)		61.7	58.3
NPA coverage ratio (%)		58.6	55.6
Capital management (*)	(E)
Risk-weighted assets (RWAs) (million euro)		80,559	78,428
Common Equity Tier 1 phase-in (%)	(1)	13.02	13.19
Tier 1, phase-in (%)	(2)	15.19	15.42
Total Capital ratio, phase-in (%)	(3)	17.60	17.76
Leverage ratio, phase-in (%)		5.20	5.19
Liquidity management	(F)
Loan-to-deposit ratio (%)		93.2	94.0
Shareholders and shares (as at reporting date)	(G)
Total number of shares outstanding (million) (*)		5,361	5,403
Share price (euro)		1.877	1.113
Market capitalisation (million euro)		10,063	6,014
Earnings per share (EPS) (euro) (**)		0.32	0.23
Book value per share (euro)		2.87	2.65
P/TBV (price/tangible book value per share)		0.78	0.51
Price/earnings ratio (P/E)		5.84	4.94
Other data
Branches and offices		1,350	1,420
Employees		18,769	19,316

(*) Information corresponding to the consolidated annual financial statements for the year ended 31 December 2024.

(**) Total number of shares minus final treasury stock position (including shares in the buyback programme, where applicable).

(***) This gives the ratio of net profit attributable to the Group, adjusted by the amount of the Additional Tier 1 coupon over the past twelve months, relative to the average number of shares outstanding over the past twelve months (average number of total shares minus average treasury stock, including buyback programmes, where applicable).

(A) This section sets out the margins of the income statement that are thought to be the most significant over the last two years. (B) These key figures are presented in order to provide a concise overview of the year-on-year changes in the main items of the Group's consolidated balance sheet,

focusing particularly on items related to lending and customer funds.

(C) These ratios have been provided to give a meaningful picture of profitability and efficiency over the past two years.

(D) This section shows the key balances related to risk management in the Group, as well as the most significant ratios related to risk.

(E) These ratios have been provided to give a meaningful picture of solvency over the past two years.

(F) The aim of this section is to give a meaningful insight into liquidity over the past two years.

(G) The purpose is to provide information regarding the share price and other indicators and ratios related to the stock market.

(1) Common equity capital / Risk-Weighted Assets (RWAs).

(2) Tier one capital / Risk-Weighted Assets (RWAs).

(3) Capital base / Risk-Weighted Assets (RWAs).

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3.2 Profit/(loss) for the year

Record-breaking Group net profit, amounting to 1,827 million euros as at the end of 2024, placing the Group's ROTE at 14.9%.

Million euro
	2024	2023	Year-on-year change (%)
Net interest income	5,021	4,723	6.3
Fees and commissions, net	1,357	1,386	(2.1)
Core revenue	6,378	6,109	4.4
Profit or loss on financial operations and exchange differences	87	68	27.4
Equity-accounted income and dividends	166	131	26.5
Other operating income and expenses	(294)	(447)	(34.3)
Gross income	6,337	5,862	8.1
Operating expenses	(2,583)	(2,496)	3.5
Staff expenses	(1,531)	(1,495)	2.5
Other general administrative expenses	(1,051)	(1,002)	5.0
Depreciation and amortisation	(501)	(519)	(3.5)
Total costs	(3,084)	(3,015)	2.3
Memorandum item:
Recurrent costs	(3,062)	(2,982)	2.7
Non-recurrent costs	(21)	(33)	(35.2)
Pre-provisions income	3,254	2,847	14.3
Provisions for loan losses	(567)	(813)	(30.3)
Provisions for other financial assets	(69)	(18)	287.7
Other provisions and impairments	(78)	(80)	(1.9)
Capital gains on asset sales and other revenue	(26)	(46)	(43.0)
Profit/(loss) before tax	2,514	1,891	33.0
Corporation tax	(685)	(557)	23.0
Profit or loss attributed to minority interests	2	1	28.1
Profit attributable to the Group	1,827	1,332	37.1
Memorandum item:
Average total assets	242,145	245,173	(1.2)
Earnings per share (euros)	0.32	0.23

The average exchange rate used for the cumulative balance of TSB's income statement is GBP 0.8463 (GBP 0.8706 in 2023).

Net interest income

Net interest income followed a positive trend, reaching 5,021 million euros as at the end of 2024, representing year-on-year growth of 6.3%, mainly due to a higher loan yield and increased revenue from the fixedincome portfolio, underpinned by higher interest rates, all of which served to offset higher cost and volume of deposits and wholesale funding.

Consequently, the net interest margin as a percentage of average total assets stood at 2.07% in 2024 (1.93% in 2023).

The breakdown of net interest income for the years 2024 and 2023, as well as the different components of total investment and funds, was as follows:

Thousand euro
		2024 2023			Change		Effect
	Average balance	Profit/(loss)	Rate %	Average balance	Profit/(loss)	Rate %	Average balance	Profit/(loss)	Rate %	Volume	Days
Cash, central banks and credit institutions	37,770,825	1,496,204	3.96	42,117,993	1,476,738	3.51	(4,347,168)	19,466	151,291	(135,900)	4,075
Loans and advances to customers	154,131,178	6,726,169	4.36	153,978,221	5,839,767	3.79	152,957	886,402	836,163	40,347	9,892
Fixed-income portfolio	30,756,499	1,053,155	3.42	28,531,645	832,967	2.92	2,224,854	220,188	193,126	25,450	1,612
Subtotal	222,658,502	9,275,528	4.17	224,627,859	8,149,472	3.63	(1,969,357)	1,126,056	1,180,580	(70,103)	15,579
Equity portfolio	1,000,799	—	—	859,258	—	—	141,541	—	—	—	—
Tangible and intangible assets	4,497,961	—	—	4,576,149	—	—	(78,188)	—	—	—	—
Other assets	13,987,412	436,450	3.12	15,110,214	508,059	3.36	(1,122,802)	(71,609)	—	(71,609)	—
Total investment	242,144,674	9,711,978	4.01	245,173,480	8,657,531	3.53	(3,028,806)	1,054,447	1,180,580	(141,712)	15,579
Central banks and credit institutions	26,372,582	(1,045,965)	(3.97)	31,484,501	(1,064,832)	(3.38)	(5,111,919)	18,867	(229,133)	251,329	(3,329)
Customer deposits	162,250,211	(1,997,041)	(1.23)	160,564,046	(1,432,303)	(0.89)	1,686,165	(564,738)	(430,055)	(130,997)	(3,686)
Capital markets	26,668,161	(1,105,456)	(4.15)	26,379,723	(876,225)	(3.32)	288,438	(229,231)	(204,199)	(22,663)	(2,369)
Subtotal	215,290,954	(4,148,462)	(1.93)	218,428,270	(3,373,360)	(1.54)	(3,137,316)	(775,102)	(863,387)	97,669	(9,384)
Other liabilities	12,485,224	(542,181)	(4.34)	13,183,674	(560,954)	(4.25)	(698,450)	18,773	—	18,773	—
Own funds	14,368,496	—	—	13,561,536	—	—	806,960	—	—	—	—
Total funds	242,144,674	(4,690,643)	(1.94)	245,173,480	(3,934,314)	(1.60)	(3,028,806)	(756,329)	(863,387)	116,442	(9,384)
Average total assets	242,144,674	5,021,335	2.07	245,173,480	4,723,217	1.93	(3,028,806)	298,118	317,193	(25,270)	6,195

Financial income or expenses arising from the application of negative interest rates are recorded in line with the nature of the associated asset or liability. The credit institutions heading on the liabilities side includes negative interest on the balances of credit institutions on the liabilities side, the most significant item being TLTRO III borrowing in 2023.

Quarterly evolution of customer margin (%)

Core results performed well in the year,⁷ growing by 6.0% due to higher net interest income and improved provisions.

Gross margin

Net fees and commissions reached 1,357 million euros as at the end of 2024, representing a decline of 2.1% year-on-year, which was mainly due to lower service fees, especially payment card and current account fees.

Profit or loss on financial operations and exchange differences reached a total of 87 million euros, representing an increase compared to the end of 2023, mainly due to higher gains on derivatives.

Dividends received and earnings of companies consolidated under the equity method amounted to 166 million euros, compared with 131 million euros in the previous year due to a higher contribution from the insurance business and greater earnings from BSCapital investees.

Other operating income and expenses amounted to -294 million euros, compared to -447 million euros in 2023. The positive year-on-year

⁷ Net interest income + fees and commissions – recurrent costs

variation is mainly explained by the fact that in the previous year -132 million euros were recognised for the contribution to Banco Sabadell's Deposit Guarantee Fund (DGF) and -76 million euros for the contribution to the Single Resolution Fund (SRF), which offset the negative variation caused by the recognition of a more severe impact of the bank levy in 2024, which was -192 million euros compared to -156 million euros recognised in the previous year.

Pre-provisions income

Total costs stood at -3,084 million euros as at year-end 2024, representing an increase of 2.3% year-on-year. Recurring costs rose by 2.7% year-on-year, due to an increase in both staff expenses and general expenses, which partially counterbalanced the reduction in amortisation/ depreciation.

The cost-to-income ratio including amortisation/depreciation for 2024 improved, standing at 48.7% compared to 51.4% in 2023. Core results (net interest income + fees and commissions – recurrent costs) improved in the year, standing at 3,315 million euros as at 2024 year-end, having grown by 6.0% year-on-year as a result of the good evolution of net interest income.

Total provisions and impairments amounted to -714 million euros as at the end of 2024, compared to -910 million euros at the end of the previous year, representing a reduction of 21.6%, mainly due to fewer provisions for loan losses.

Capital gains on asset sales and other revenue amounted to -26 million euros as at the end of 2024. The positive year-on-year change is due to the recognition of lower IT asset write-offs.

Profit attributable to the Group

After deducting corporation tax and minority interests, net profit attributable to the Group amounted to 1,827 million euros as at the end of 2024, growing 37.1% year-on-year.

3.3 Balance sheet

Million euro

	2024	2023	Year-on-year change (%)
Cash, cash balances at central banks and other demand deposits	18,382	29,986	(38.7)
Financial assets held for trading	3,439	2,706	27.1
Non-trading financial assets mandatorily at fair value through profit or loss	168	153	9.9
Financial assets at fair value through other comprehensive income	6,370	6,269	1.6
Financial assets at amortised cost	196,520	180,914	8.6
Debt securities	24,876	21,501	15.7
Loans and advances	171,644	159,413	7.7
Investments in joint ventures and associates	525	463	13.4
Tangible assets	2,078	2,297	(9.5)
Intangible assets	2,549	2,483	2.7
Other assets	9,567	9,902	(3.4)
Total assets	239,598	235,173	1.9
Financial liabilities held for trading	2,381	2,867	(16.9)
Financial liabilities at amortised cost	220,228	216,072	1.9
Deposits	186,341	183,947	1.3
Central banks	1,697	9,776	(82.6)
Credit institutions	14,822	13,840	7.1
Customers	169,823	160,331	5.9
Debt securities issued	27,437	25,791	6.4
Other financial liabilities	6,450	6,333	1.8
Provisions	478	536	(10.8)
Other liabilities	1,477	1,818	(18.8)
Total liabilities	224,565	221,294	1.5
Shareholders' equity	15,389	14,344	7.3
Accumulated other comprehensive income	(391)	(499)	(21.6)
Minority interests (non-controlling interests)	34	34	0.6
Equity	15,033	13,879	8.3
Total equity and total liabilities	239,598	235,173	1.9
Loan commitments given	28,775	27,036	6.4
Financial guarantees given	1,980	2,064	(4.1)
Other commitments given	9,366	7,943	17.9
Total memorandum accounts	40,121	37,043	8.3

The EUR/GBP exchange rate used for the balance sheet was 0.8292 as at 31 December 2024.

Gross performing loans to customers ended the year 2024 with a balance of 156,913 million euros, growing by 4.7% year-on-year, driven both by good performance in Spain, where it is particularly worth noting the growth of lending to corporates and individuals, and by the businesses abroad, particularly Miami and TSB, in the latter case positively impacted by the appreciation of the pound sterling.

Home equity loans formed the largest single component of gross loans and receivables, amounting to 89,185 million euros as at 31 December 2024 and representing 57% of total gross performing loans to customers.

			Year-on-year
	2024	2023	change (%)
Loans and credit secured with mortgages	89,185	86,162	3.5
Loans and credit secured with other collateral	5,924	5,064	17.0
Trade credit	8,356	7,465	11.9
Finance leases	2,376	2,236	6.3
Bank overdrafts and other short-term borrowings	51,071	48,870	4.5
Gross performing loans to customers	156,913	149,798	4.7
Stage 3 assets (customers)	4,595	5,472	(16.0)
Accrual adjustments	208	172	21.3
Gross loans to customers, excluding reverse repos	161,717	155,442	4.0
Reverse repos	—	17	(100.0)
Gross loans to customers	161,717	155,459	4.0
Reserve for loan losses and country risk	(2,844)	(3,199)	(11.1)
Loans and advances to customers	158,872	152,260	4.3

The EUR/GBP exchange rate used for the balance sheet was 0.8292 as at 31 December 2024.

The composition of loans and advances to customers by type of product is shown in the following figure (not including stage 3 assets or accrual adjustments):

As at the end of 2024, on-balance sheet customer funds amounted to 169,557 million euros, compared to 160,888 million euros as at the end of 2023, increasing by 5.4% due to a higher volume of both demand deposits and term deposits.

Demand deposit balances amounted to 138,347 million euros, representing an increase of 3.1% compared to 2023.

Term deposits came to a total of 31,047 million euros, representing growth of 21.3% year-on-year.

The breakdown of customer deposits as at 2024 year-end is shown below:

Total off-balance sheet customer funds came to 46,171 million euros as at the end of 2024, reflecting an increase of 13.8% in year-on-year terms, driven by the good performance of mutual funds, mainly as a result of a positive level of net inflows.

Total funds under management as at 31 December 2024 amounted to 243,431 million euros, compared to 226,682 million euros as at 31 December 2023, representing a year-on-year increase of 7.4%, due to the growth of both on-balance sheet and off-balance sheet customer funds mentioned above.

			Year-on-year
	2024	2023	change (%)
On-balance sheet customer funds (*)	169,557	160,888	5.4
Customer deposits	169,823	160,331	5.9
Current and savings accounts	138,347	134,243	3.1
Term deposits	31,047	25,588	21.3
Repos	—	200	--
Accrual adjustments and hedging derivatives	429	299	43.3
Borrowings and other marketable securities	23,345	22,198	5.2
Subordinated liabilities (**)	4,092	3,593	13.9
On-balance sheet funds	197,260	186,122	6.0
Undertakings for collective investment in transferable securities	28,308	24,093	17.5
UCITS managed	674	589	14.5
UCITS sold but not managed	27,634	23,504	17.6
Assets under management	4,729	3,598	31.4
Pension funds	3,352	3,249	3.2
Personal schemes	2,166	2,103	3.0
Workplace schemes	1,183	1,141	3.7
Collective schemes	4	5	(21.8)
Insurance products sold	9,782	9,621	1.7
Off-balance sheet customer funds	46,171	40,561	13.8
Funds under management and third-party funds	243,431	226,682	7.4

(*) Includes customer deposits (excl. repos) and other liabilities placed via the branch network: straight bonds issued by Banco Sabadell, commercial paper and others.

(**) Refers to subordinated debt securities issued.

The EUR/GBP exchange rate used for the balance sheet was 0.8292 as at 31 December 2024.

The balance of non-performing assets was reduced by 1,068 million euros over the year, while the coverage ratio considering total provisions rose to 58.6%.

Non-performing assets were reduced over the year 2024. The quarterly performance of these assets in 2024 and 2023 is shown below:

Million euro
	2024					2023
	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Ordinary net increase in stage 3 loans	40	(182)	(27)	(307)	183	111	85	(35)
Real estate asset balance variation	(32)	(36)	(31)	(36)	(40)	(34)	(44)	(68)
Ordinary net increase in stage 3 loans + real estate	8	(219)	(58)	(344)	143	77	41	(103)
Write-offs	100	97	128	132	106	114	82	79
Ordinary QoQ change in balance of stage 3 loans and real estate	(92)	(316)	(186)	(476)	37	(37)	(41)	(182)

As a result of the reduction in exposures classified as stage 3, associated with an increase in the risk base, the NPL ratio reached 2.84% as at 2024 year-end, compared to 3.52% as at 2023 year-end (decrease of 68 basis points). The stage 3 coverage ratio with total provisions as at 31 December 2024 was 61.7% compared to 58.3% one year earlier, while the coverage ratio of non-performing real estate assets stood at 40.5% as at 31 December 2024, compared to 39.6% at the end of the previous year.

As at 31 December 2024, the balance of exposures classified as stage 3 in the Group amounted to 4,844 million euros (including contingent exposures), a decline of 933 million euros in 2024.

NPL ratio (*) (%)

(*) Calculated including contingent exposures.

The trend followed by the Group's coverage ratios is shown in the table below:

Million euro

		2024				2023
	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Exposures classified as stage 3	5,718	5,439	5,283	4,844	5,891	5,888	5,891	5,777
Total provisions	3,346	3,247	3,213	2,990	3,219	3,280	3,329	3,368
Stage 3 coverage ratio, with total provisions (%)	58.5	59.7	60.8	61.7	54.6	55.7	56.5	58.3
Stage 3 provisions	2,433	2,399	2,365	2,245	2,328	2,361	2,402	2,445
Stage 3 coverage ratio (%)	42.5	44.1	44.8	46.3	39.5	40.1	40.8	42.3
Non-performing real estate assets	939	902	872	836	1,117	1,083	1,039	971
Provisions for non-performing real estate assets	370	356	352	338	429	419	404	385
Non-performing real estate coverage ratio (%)	39.4	39.5	40.3	40.5	38.4	38.7	38.9	39.6
Total non-performing assets	6,657	6,341	6,155	5,680	7,008	6,971	6,930	6,748
Provisions for non-performing assets	3,715	3,604	3,564	3,329	3,648	3,699	3,733	3,752
NPA coverage ratio (%)	55.8	56.8	57.9	58.6	52.1	53.1	53.9	55.6

Includes contingent exposures.

3.4 Liquidity management

The Group's liquidity position is sound, with a balanced funding structure.

During 2024, the funding gap turned positive, with a sharper increase in customer funds than in lending. Funding in capital markets increased at the level of both securitisations and debt issuances compared to 2023, senior non-preferred debt and subordinated debt being the items with the greatest net increase, in order to keep an adequate level of own funds and eligible liabilities above the applicable regulatory requirement (Minimum Requirement for own funds and Eligible Liabilities, or MREL). The Group's Loan-to-Deposit (LTD) ratio as at 31 December 2024 was 93.2% (94.0% as at 31 December 2023).

The Institution has made use of the different issuance windows to access the capital markets at different times in the year, successfully completing the issuance plan, in an environment in which inflation continued to cool off and central banks have eased their monetary policies by cutting interest rates. Maturities and early repayments in capital markets over the year amounted to 4,088 million euros (net). On the other hand, Banco Sabadell carried out two issues under the current Base Prospectus of Non-Equity Securities amounting to a total of 1.75 billion euros, specifically the following: one issue of mortgage covered bonds on 5 June 2024 for 1 billion euros with a 10-year maturity, and another issue of mortgage covered bonds on 15 October 2024 for 750 million euros with a 5.5-year maturity. Furthermore, under the EMTN Programme, Banco Sabadell carried out five issues for a total amount of 2,793 million euros, specifically the following: one issue of senior preferred debt on 15 January 2024 for 750 million euros with a 6-year maturity and an early call option in favour of Banco Sabadell in the fifth year; one issue of senior non-preferred debt on 13 March 2024 for 500 million euros with a 6.5-year maturity and an early call option in favour of Banco Sabadell in the second half of the fifth year; one issue of Tier 2 subordinated bonds on 27 March 2024 for 500 million euros with a 10.25 year maturity and an early call option in favour of Banco Sabadell in the fifth year; its first-ever issue in pounds sterling of senior preferred debt on 13 September 2024 for 450 million pounds with a 5-year maturity; and one issue of senior non-preferred debt on 27 November 2024 for 500 million euros with a 6.5-year maturity and an early call option in favour of Banco Sabadell in the second half of the fifth year. In addition, TSB Bank carried out two issues of mortgage covered bonds: its first-ever issue in euros for 500 million with a 5-year maturity on 5 March 2024, and another issue for 500 million pounds sterling with a 5-year maturity on 11 September 2024.

During 2024, having obtained the corresponding authorisation, Banco Sabadell exercised the early redemption option on the Senior Debt 2/2019 series amounting to 500 million euros on 7 November 2024. Furthermore, having obtained the corresponding authorisation, Banco Sabadell released an announcement to the market in November regarding the early redemption of the Subordinated Debt 1/2020 series in the amount of 300 million euros, which was subsequently exercised on 17 January 2025.

In relation to securitisation transactions, on 23 May 2024, TSB Bank set up the securitisation fund of residential mortgage loans, Duncan Funding 2024-1 PLC, through which it securitised one portfolio of

mortgage loans in the amount of 557.7 million pounds sterling. The entire senior tranche of 500 million pounds was placed on the market.

On 26 September 2024, Banco Sabadell disbursed the traditional securitisation Sabadell Consumo 3, F.T. under its consumer loan securitisation programme. This is the third operation of the programme enabling the credit risk of a 750 million euro consumer loan portfolio to be financed and transferred. The issue consists of seven classes of bonds that were placed on the market, with the exception of the first loss tranche of 9.2 million euros to fund the reserve fund and initial expenses, and 76.3 million euros from the senior series which was subscribed by Banco de Sabadell, S.A.

The Institution has maintained a liquidity buffer in the form of liquid assets to meet potential liquidity needs.

In terms of the LCR, since 1 January 2018, the regulatory required minimum LCR has been 100%, a level amply surpassed by all of the Institution's LMUs. The TSB and Banco Sabadell Spain LMUs have a level of 200% and 248%, respectively, as at 31 December 2024. At the Group level, the Institution's LCR remained well above 100% on a stable basis at all times throughout the year, ending 2024 at 210%. As for the Net Stable Funding Ratio (NSFR), which came into force on 28 June 2021, the Institution has remained steadily above the minimum requirement of 100% in all LMUs. As at 31 December 2024, the NSFR stood at 153% for the TSB LMU, 137% for Banco Sabadell Spain and 142% for the Group.

The key figures and basic liquidity ratios reached at the end of 2024 and 2023 are shown here below:

Million euro

	2024	2023
Gross loans to customers, excluding reverse repos	161,717	155,442
Impairment allowances	(2,844)	(3,199)
Brokered loans	(884)	(953)
Net loans and advances excluding ATAs, adjusted for brokered loans	157,988	151,290
On-balance sheet customer funds	169,557	160,888
Loan-to-deposit ratio (%)	93	94

The EUR/GBP exchange rate used for the balance sheet is 0.8292 as at 31 December 2024 and 0.8691 as at 31 December 2023.

The main sources of funding as at 2024 year-end are shown below according to the type of instrument and counterparty (in %):

(*) Without accrual adjustments or hedging derivatives.

Loans and advances

(*) Without accrual adjustments or hedging derivatives.

For further details about the Group's liquidity management, liquidity strategy and liquidity performance during the year, see Note 4 to the 2024 consolidated annual financial statements.

3.5 Capital management

Key capital figures and solvency ratios

Thousand euro

	31/12/2024		31/12/2023
	Fully-loaded	Phase-in	Fully-loaded	Phase-in
Common Equity Tier 1 (CET1) capital	10,484,954	10,484,954	10,346,761	10,346,761
Tier 1 (T1) capital	12,234,954	12,234,954	12,096,761	12,096,761
Tier 2 (T2) capital	1,945,862	1,945,862	1,829,460	1,829,460
Total capital (Tier 1 + Tier 2)	14,180,816	14,180,816	13,926,221	13,926,221
Risk weighted assets	80,559,227	80,559,227	78,427,616	78,427,616
CET1 (%)	13.02 %	13.02 %	13.19 %	13.19 %
Tier 1 (%)	15.19 %	15.19 %	15.42 %	15.42 %
Tier 2 (%)	2.42 %	2.42 %	2.33 %	2.33 %
Total capital ratio (%)	17.60 %	17.60 %	17.76 %	17.76 %
Leverage ratio	5.20 %	5.20 %	5.19 %	5.19 %

In 2018, following the entry into force of IFRS 9, the Group opted to apply the transitional arrangements established in Regulation (EU) 2017/2395. In 2023 and 2024, the transitional arrangements arising as a result of IFRS 9 and still in effect had no impact on the Institution's solvency ratios.

During 2024, the Group increased its capital base by 255 million euros in fully-loaded terms.

In 2024, the Bank carried out the issue of Subordinated Debt 1/2024 for 500 million euros on 27 March 2024. The loss of eligibility of the Subordinated Debt issue 1/2020 in the amount of 300 million euros also occurred, after it was announced, on 18 November 2024, that the early redemption option was to be exercised on 17 January 2025, in accordance with the issue's terms and conditions.

In terms of Risk-Weighted Assets (RWAs), three securitisation operations were carried out during the year: one synthetic securitisation carried out in June 2024 on a 1.1 billion euro project finance portfolio; one traditional securitisation carried out in September 2024 on a 750 million euro consumer loan portfolio; and one synthetic securitisation carried out in December 2024 on a 1.23 billion US dollar portfolio of corporate loans and project finance.

Furthermore, at Banco Sabadell ex-TSB, the increase in credit RWAs is noteworthy due to the growth in lending and the implementation of new models for corporates and groups and for retail card and loan exposures. In addition, market risk grew over the period mainly as a result of the increased open forex position. Finally, the update to operational RWAs led to a rise in RWAs, given the increase in the material risk indicator in 2024.

As a result, the fully-loaded CET1 ratio stood at 13.02% as at yearend 2024.

As at 31 December 2024, the Group had a phase-in CET1 capital ratio of 13.02%, well above the requirement established in the Supervisory Review and Evaluation Process (SREP), which for 2024 was 8.95%, meaning that the aforesaid ratio is 406 basis points above the minimum requirement.

Minimum capital requirements have been calculated taking into account capital requirements in effect as at 2024 year-end for Pillar 1 (8%) and Pillar 2R (2.25%), as well as the capital conservation buffer (2.5%), countercyclical buffer (0.44%) and the buffer for other systemically important institutions (0.25%).

In May 2024, the SRB published the MREL Policy under the Banking Package, which integrates the regulatory changes of the aforesaid resolution framework reform. The new requirements from the SRB are based on balance sheet data as at December 2023 and set the final MREL target, which is binding from 17 December 2024, the same day that Banco Sabadell received a communication from the Bank of Spain regarding the decision made by the Single Resolution Board (SRB) concerning the Minimum Requirement for own funds and Eligible Liabilities (MREL) and the subordination requirement applicable to the Institution on a consolidated basis.

The requirements that must be met from 17 December 2024 are as follows:

• The MREL is 22.14% of the Total Risk Exposure Amount (TREA) and 6.39% of the Leverage Ratio Exposure (LRE).
• The subordination requirement is 15.84% of the TREA and 6.39% of the LRE.

The own funds used by the Institution to meet the Combined Buffer Requirement (CBR), comprising the capital conservation buffer, the systemic risk buffer and the countercyclical buffer, will not be eligible to meet the MREL and subordination requirements expressed in terms of the TREA.

As at the end of 2024 and 2023, Banco Sabadell meets the applicable requirements. Furthermore, the Institution's Funding Plan anticipates that it will continue to comply, comfortably, with the current requirements.

The RWAs percentage includes the capital earmarked to meet the Combined Buffer Requirement (CBR). This serves as a mechanism to accumulate capital to protect against cyclical and structural systemic risks, in order to build up own funds during periods of prosperity and thus be able to protect the regulatory minimum during periods of adverse economic conditions.

• Banking Business Spain
• Banking Business UK
• Banking Business Mexico

Businesses

The key financial figures associated with the Group's largest business units are shown hereafter, in line with the segment reporting in Note 38 to the consolidated annual financial statements for the financial year 2024.

4.1 Banking Business Spain

Key figures

Net profit as at the end of 2024 amounted to 1,517 million euros, representing a year-on-year increase of 38.7%, mainly driven by the positive trend in net interest income and fewer provisions.

Net interest income amounted to 3,652 million euros as at 2024 year-end, a year-on-year increase of 8.9% driven by the collection of 36 million euros in extraordinary late payment interest stemming from the debt recovered following a favourable ruling in a legal dispute. Excluding that effect, growth stood at 7.8% driven by higher loan yields and higher earnings on the fixed-income portfolio, underpinned by interest rates, all of which offset the higher cost and volume of both deposits and wholesale funding.

Net fees and commissions stood at 1,231 million euros, 1.3% less than at the end of 2023, mainly due to the drop in service fees, heavily impacting payment card and demand deposit fees.

Profit or loss on financial operations and exchange differences amounted to 36 million euros, which represents a year-on-year reduction mainly due to higher gains on derivatives.

Dividends and earnings of companies consolidated under the equity method increased by 26.5% in year-on-year terms, mainly due to the higher contribution from the insurance business and higher earnings from BSCapital investees.

The positive variation in the Other income and expenses heading is mainly explained by the fact that in the previous year -132 million euros were recognised for the contribution to Banco Sabadell's Deposit Guarantee Fund (DGF) and -76 million euros for the contribution to the Single Resolution Fund (SRF), which offset the negative variation caused by the recognition of a more severe impact of the bank levy in 2024, which was -192 million euros compared to -156 million euros in the previous year.

Total costs recorded a year-on-year increase of 5.4%, due to higher staff expenses and an increase in general expenses.

Provisions and impairments amounted to 652 million euros, down by 20.1% year-on-year, mainly due to improved provisions for loan losses. 2024 saw the release of 54 million euros related to the debt recovered following a legal dispute and to provisions allocated for the impact of DANA.

Corporation tax in 2024 includes a positive impact of c.50 million euros, mainly due to tax deductions for R&D+i (research, development and innovation) activities.

Million euro

			Year-on-year
	2024	2023	change (%)
Net interest income	3,652	3,353	8.9
Fees and commissions, net	1,231	1,247	(1.3)
Core revenue	4,883	4,601	6.1
Profit or loss on financial operations and exchange differences	36	45	(19.9)
Equity-accounted income and dividends	166	131	26.5
Other operating income and expenses	(249)	(404)	(38.3)
Gross income	4,836	4,372	10.6
Operating expenses, depreciation and amortisation	(2,071)	(1,965)	5.4
Pre-provisions income	2,765	2,407	14.9
Provisions and impairments	(652)	(816)	(20.1)
Capital gains on asset sales and other revenue	(14)	(27)	(47.2)
Profit/(loss) before tax	2,098	1,564	34.2
Corporation tax	(579)	(469)	23.5
Profit or loss attributed to minority interests	2	1	28.1
Profit attributable to the Group	1,517	1,093	38.7
Cumulative ratios
ROTE (net return on tangible equity)	15.9 %	12.0 %
Cost-to-income (general administrative expenses / gross income)	35.1 %	37.2 %
NPL ratio	3.3 %	4.3 %
Stage 3 coverage ratio, with total provisions	66.3 %	59.9 %

Gross performing loans increased by 5.3%, driven by the growth in lending to corporates and individuals, notably the positive evolution of the mortgage book, as well as the healthy performance of foreign branches, included in this perimeter, particularly Miami.

On-balance sheet customer funds increased by 5.4% year-on-year, while off-balance sheet funds grew by 13.8%, mainly due to mutual funds, as a result of a positive level of net inflows.

Million euro
--------------

			Year-on-year
	2024	2023	change (%)
Assets	177,348	173,648	2.1
Gross performing loans to customers	109,291	103,830	5.3
Non-performing real estate assets, net	497	586	(15.2)
Liabilities and Equity	177,348	173,648	2.1
On-balance sheet customer funds	124,235	117,820	5.4
Wholesale funding in capital markets	21,135	19,949	5.9
Allocated own funds	12,161	11,345	7.2
Off-balance sheet customer funds	46,171	40,561	13.8
Other indicators
Employees	13,525	13,455	0.5
Branches and offices	1,152	1,194	(3.5)

Details of the main business lines within Banking Business Spain are given here below.

Retail Banking

Business overview

Retail Banking is Banco Sabadell's business unit that offers financial products and services to individuals for personal use. The business is based on a banking model that combines processes typical of a digital bank for interactions that require the autonomy, immediacy and simplicity that only digital channels can offer with specialised and personalised commercial management for those interactions where expert support is needed, provided through the branch network, both in brick-and-mortar branches and remotely. Among the main products offered, it is worth noting investment and financing products in the short, medium and long term such as consumer loans, mortgages and leasing/rental services. As for funds, the main products on offer are customer term and demand deposits, savings insurance, mutual funds and pension plans. Additionally, the main services also include payment methods such as cards and various kinds of insurance products.

Management milestones in 2024 and priorities for 2025

During 2024, Retail Banking based its activity on the following pillars that contribute to the objective of increasing the base of transactional customers, growing market share in key products and providing first class service to customers:

• Organisation according to products, which makes it possible to focus on customers' needs and to offer specialised and personalised products and services, enabling greater autonomy, immediacy, agility and simplicity.
• The specialised sales force, supported by the branch network, allows a superior customer support model to be offered for products where customers require more advice or support from experts, such as mortgages, protection insurance and savings/investment.
• The development of digital capabilities in relation to servicing, the attraction of digital demand and the generation of digital sales in selfservice and remote channels.

In that regard, in 2024 the Retail Banking business has continued with its transformation, moving forward in the following areas:

• Customer-focused growth, increasing engagement with the Bank and with more than half of new customers currently registered through the digital channel according to 2024 closing data.
• Continue with the change in the sales distribution mix, increasing, in turn, the sales volumes of key products. The specialists model was also evolved, increasing their contribution to the business.
• Serve the Bank's customers through their preferred channel. The mobile app has gained prominence, consolidating itself as the main interaction channel for serving customers.
• A remarkable improvement in customer experience rankings on the back of enhancing the quality of interactions with them, which forges long-lasting and quality relationships, whilst promoting the brand, increasing its visibility and awareness to grow market share.

The priorities for 2025 focus on boosting customer acquisition by leveraging digital channels and increasing penetration during the first months of the business relationship. The Bank also seeks to promote key products, improve the brand's appeal and the customer experience across all channels, as well as enhance talent and data management.

Main products

The main Retail Banking products are described here below:

Mortgages

The evolution of the mortgage market during 2024 was characterised by growth in the first quarter of the year, with a yearly increase of 18%. Starting in the second quarter, growth was around 20%, with a record month of increases in July. This increase was driven by cuts to interest rates, the 12-month Euribor and declining mortgage rates, slightly lowering monthly payments and encouraging the moderate recovery of the real estate market, seen in the increase in new build permits, although the lack of supply limits growth.

Fixed-rate mortgages were the leading product of 2024, a clear consequence of the current market interest rates, with the Euribor still at high levels.

Against this backdrop, the Bank continued to make progress on:

• The cumulative market share, which has grown significantly given the Institution's good product positioning in the market.
• The mortgage specialists' distribution model, with all branches included in the model, focusing on remote management (209 remote specialists covering 100% of branches).
• The transformation of the mortgage process, with outsourcing of administrative tasks to focus on the commercial function of specialists and increase capacity to generate and manage demand, reduce processing lead times and improve the customer experience.
• Improving the digital experience in the mortgage application process, optimising mortgage switching and making efficiency gains. In particular, the focus has been upstream in the digital journey, where technological, intelligence and commercial systems capabilities have been deployed to allow better prioritisation of commercial opportunities.

Consumer loans

In consumer loans, 2024 was characterised by a 36% increase in volume, driven by the expansion and improvement of digital product arrangement capabilities and the adaptation of the product offer to the needs of the end consumer, whilst always ensuring adequate risk management and segmentation.

Currently, 83% of all products are applied for through the digital channels, and pre-approved loans account for 87% of all new loans.

Payment services

2024 was a good year for growth in card transactions, with an 8% increase in purchases, which reached 21,225 million euros. Card finance volume reached 389 million euros, representing a year-on-year increase of 9%.

On the other hand, the instant card issuance process was consolidated, allowing customers to use their new card immediately in ecommerce and mobile payment transactions following application. The percentage of card activations executed via digital channels accounted for 52% of total activations, while mobile payments represented 30% of purchases.

With regard to the Bizum payment system, Banco Sabadell has more than 1.6 million registered users.

Demand deposit accounts

Banco Sabadell has a digital onboarding process that has allowed it to boost its acquisition of digital customers since 2023, improving productivity and the customer experience.

In 2024, the Sabadell Online Account was overhauled once again, extending its use to the self-employed segment, in order to become their preferred bank for both personal and professional transactions. This overhaul is another boost to continue growing Retail Banking profitably.

• The main demand deposit accounts offered are the following:
• Sabadell Online Account: for new retail customers, opened digitally.
• Sabadell Account: for retail customers.
• Sabadell Premium Account: exclusively for Private Banking customers.
• Key Account: exclusively for non-resident foreign customers.

The main product offer is supplemented with the products aimed at customers with specific needs: non-residents, minors under the age of 18, and the basic payment account for those at risk of exclusion.

Savings and investment

Market volatility and interest rates affected asset performance and, consequently, mutual fund returns.

In mutual funds, the main milestones during the year were the following:

• The mutual funds offering was adapted to the market situation and to customer demand by incorporating the following types of products:
  • Guaranteed products: during 2024, guaranteed fund programmes were marketed. These products combine fixed and variable return funds, namely: Sabadell Capital Extra No. 3, Sabadell 12M Garantizado and Sabadell 12M Garantizado Diciembre.
  • Stable return products: a new product in the Bank's fixed income category launched in September, Sabadell Gobiernos Corto Plazo, FI, which is a new fund that is marketed all year round.
  • Target return products: Sabadell Horizonte 11 2026 and Sabadell Horizonte 06 2025 were launched in January and May, respectively. These products offer a target, not guaranteed, return to recover 100% of the initial investment plus a return on maturity.
  • Discretionary portfolio management: portfolio management service focused on those customers who want specialists to be in charge of their investments, according to their risk profile and objectives. Therefore, three different types of portfolios are available to start investing with the option of choosing between five strategies with different levels of risk.
    • Sabadell Portfolio (Cartera Sabadell): with a percentage of equities of 25%, 50% and 75%.
    • Sabadell Plus Portfolio (Cartera Sabadell Plus): with a percentage of equities of 10%, 25%, 50% and 75%.
    • Sabadell Private Portfolio (Cartera Sabadell Privada): with a percentage of equities of 10%, 25%, 50%, 75% and 90%.

An exclusive investment option for Sabadell Private portfolios (profiles: 50, 70 and 90) and Sabadell Plus portfolios is also now available.

— Charitable products: in order to boost the Sabadell Inversión Ética y Solidaria charitable fund, given the increased interest in this type of

fund, its contribution to charitable initiatives has been increased, while the management fee percentage has been reduced, thereby offering customers more opportunities to increase their returns.

— Workflows have been initiated to enhance the customer experience of the digital channel.

With regard to guaranteed return insurance plans, the high-interest rate environment boosted customer interest in these products. Specifically, life-contingent annuities saw a significant increase in premiums compared with previous years. In July 2024, a new savings insurance product with regular contributions (Sabadell Savings Insurance) was launched to drive sales of this line of business of regular savings with guaranteed returns.

This activity was also seen in the unit-linked savings insurance product which involves assets linked to structured deposits with a capital guarantee and fixed coupon. Specifically, two multi-asset investment issues with an 18-month maturity were carried out, in which the linked assets are deposits issued by Banco Sabadell.

With regard to the pensions business, as in the case of guaranteed return insurance plans, the rise in interest rates increased demand for Insured Retirement Plans (IRPs), particularly those with a payback period of less than five years. This led to the launch of issues of IRPs with these payback periods, mainly channelled towards transfers from pension schemes or short-term IRPs, due to the higher return offered. However, growth in the pensions business is influenced by the application of a cap on the maximum annual contribution. The marketing of the simplified occupational pension plans for the self-employed began at the end of last year. These plans allow contributions higher than those of individual plans and are promoted by the Professional Union of Self-Employed Workers (Unión Profesional de Trabajadores Autónomos, or UPTA) and the General Council of Economists (Consejo General de Economistas).

It is worth highlighting that specialists continued to be deployed in 2024. As at the end of December 2024, the cumulative contribution to new business of in-branch specialists was 30% and that of branches whose employees included a specialist was 73%.

As for deposits, the focus in 2024 was on maintaining products adapted to customers' needs. To that end, the range of products available at the branches was expanded with new products, and the digital product arrangement channel was opened, aimed mainly at digitally savvy customers.

The main milestones during the year were the following:

• Launch of products available at the branches:
  • Depósito Crecimiento 12 meses, which complemented the current offer at that time (Depósito Crecimiento 18 meses).
  • Depósito Sabadell Bonificado, a 12-month deposit based on an initial interest rate, which may be increased depending on the customer's current holding and/or new arrangement of a series of products/services.
• With regard to online deposits, during 2024 and in accordance with the digital transformation strategy, the offer has been expanded with new terms, consolidating the digital application process as a lever for growth in retail customer deposits thanks to how easy they are to arrange as well as the interest paid. The online process allows the Bank to improve productivity and the customer experience.

Lastly, the offering of structured deposits was maintained over the year.

Protection insurance

The Group's insurance business is based on a comprehensive offering that meets customers' personal needs and cash requirements. The subscription itself is carried out through insurers in which the Group holds a 50% stake through the agreement between Zurich Group, BanSabadell Vida and BanSabadell Seguros Generales. The first of these insurers, which has the largest business volume, occupies the top spots in insurance firm rankings, based on premiums issued.

The strategy for the insurance business in Retail Banking consists of offering the Bank's customers the best option for protection insurance. To that end, a product offering is proposed, adapted to the needs of each type of customer, to ensure customer satisfaction every time they interact with the Bank. Commercial actions are mainly carried out through the insurance specialist, providing services to the Institution's different customer segments.

In 2024, the business has continued to grow in spite of the complicated and uncertain environment that exists at present. The main products that contribute to the insurance business are life insurance, home insurance and health insurance. Specifically, the strong growth experienced in premiums in the area of health insurance products (19%) was the result of the agreement with the company Sanitas reached at the end of 2020. It is also worth noting Banco Sabadell's promotion of Blink insurance products, specifically, home insurance and vehicle insurance, which are arranged remotely.

In addition, with the aim of offering customers quality solutions, significant improvements have been made to life insurance and home insurance products, with new levels of cover adapted to customers' current needs, such as serious illness, assistance in the event of unlawful occupation or free home repair service.

BanSabadell Seguros Generales sells a funeral insurance product, through an agreement with the company Meridiano, a leading institution in this field.

Sabadell Consumer Finance

Sabadell Consumer Finance is the Group's company specialising in consumer finance at the point of sale. It carries out its activity through various channels and lines of business via cooperation agreements.

The activity of the automotive business in 2024 has been adapted to the market trend, maintaining a positive monthly performance in terms of new business, as well as strengthening agreements with large groups.

It is also continued to engage in digital transformation – a journey that started in 2023 – to grow with new proposals and more digital services. Instant Credit, a finance facility available directly through the Bank's PoS devices, was launched.

In 2024, Sabadell Consumer Finance executed 220,000 new transactions through more than 12,000 points of sale located throughout Spain, which translated into an inflow of new investments amounting to 1,543 million euros, placing the total outstanding exposures of Sabadell Consumer Finance at 2,743 million euros.

Business Banking

Business overview

The Business Banking unit offers financial products and services to legal and natural persons for business purposes, serving all types of companies with a turnover of up to 200 million euros, as well as the institutional sector. The products and services offered to companies are based on short- and long-term funding solutions, solutions to manage cash surpluses, products and services to guarantee the processing of day-to-day payments and collections through any channel and in any geographical area, as well as risk hedging and bancassurance products.

Banco Sabadell has a clearly defined relationship model for each business segment, which is innovative and sets it apart from its peers and which allows it to be very close to its customers, acquiring in-depth knowledge of its customer base whilst at the same time offering a strong level of engagement.

Companies with turnover in excess of 2 million euros are mainly managed by specialised branches. All other companies, which include SMEs, small businesses and self-employed professionals, are managed by standard branches. All of these companies have relationship managers who specialise in their respective segments, as well as access to expert advice from product and/or sector specialists.

This all enables Banco Sabadell to be a yardstick for all companies, as well as a leader in customer experience.

Management milestones in 2024 and priorities for 2025

In 2024, the Business Banking unit focused its management efforts on strengthening the strategic courses of action established for each segment, in accordance with the Strategic Plan. This approach is reflected in a significant improvement in the profitability and specialisation of the Corporates and SMEs segments, through specialised solutions tailored to customers, and in the framework's enhancement and the risk function's rapid optimisation of the portfolio's credit profile. The branch network's specialisation has helped to evince improvements in the business's cost of risk and Return on Equity (ROE).

Furthermore, the development and enhancement of the sector's commercial offering aimed at small businesses and self-employed professionals constituted another key management milestone during 2024, successfully consolidating the Bank's position as a leading

specialist in the market for this segment. In its mission of maximising the value proposition and offering its customers a wide range of products and services, Banco Sabadell declared that it planned to close a strategic deal with Nexi, a European leader in digital payments. While awaiting receipt of the necessary regulatory authorisations to close this transaction, it is also currently pending news of the outcome of BBVA's tender offer to acquire all of the Bank's share capital.

Following the structural change implemented in the past year, the reorganisation of the Business Banking network has been successfully implemented. This model has made it possible to address customers and their needs more closely, through increased specialisation of managers and an approach focused on the needs of those customers.

In 2025, Business Banking will face a series of key challenges that will set the course for its strategy in the coming years. Efforts will be made to boost the growth of the customer base and the profitability of the various segments, endeavouring to optimise operational efficiency and the range of specialised products and services so as to meet the specific needs of each customer. Particular emphasis will be placed on improving cost of risk, implementing proactive measures to mitigate risks and make the portfolio more robust.

In addition, the Institution's commitment to excellence in customer experience will be a core pillar. Significant initiatives will be undertaken, designed to improve customer interactions and satisfaction across all segments, from corporates to self-employed persons.

Lastly, the Institution aims to consolidate and cement its position as the leading bank for its business customers. This goal will be achieved with high-quality financial solutions, the cornerstones of the approach being innovation, specialisation, and customer centricity and proximity.

The different segments, specialists and commercial products that fall within Business Banking are described here below.

Segments

Corporates

At the beginning of 2024 the Business Banking network was reorganised with the aim of strengthening management of these customers through increased specialisation and an approach more directly focused on their needs.

Until recently, the Business Banking network had been formed by 32 branches that provided services to large corporations, managing companies with turnover in excess of 10 million euros. These branches were supplemented by 31 new Team Managers managing around 300 new Business Banking Managers who focus on managing companies with turnover between 2 and 10 million euros. These new teams are not located in a specific branch, but manage companies that already hold an account in one of the branch network's 1000 branches. These teams also include Startup Managers, who are specialists in this customer segment.

Over the year, the skillsets of Business Banking network managers have been enhanced through a training plan providing targeted training, such as, the university-certified Advanced Business Programme, certification in Sustainable Finance, sector specialisation training, or inhouse training in the middle market segment and investment banking. This specific training will continue in 2025, adapting to the needs of the branch network and the market.

This increased specialisation in management was accompanied by improved operational customer care and enhanced customer service for companies. This was achieved in 2024 through the Business Operations Centres. This new service model offers businesses a stable and trusted personal relationship with a contact person who is an expert in their field, fast and professional contact through different channels (Preferential

Care Services for Business Banking customers by phone and through the Customer Care Space, which offers a specific BSOnline chat service that is also available via WhatsApp), and an immediate response in urgent and time-critical situations.

In an economic environment marked by the geopolitical situation, inflation and interest rate volatility, this comprehensive customer management service has made it possible to support companies by adapting to their circumstances. Banco Sabadell has offered customers with liquidity needs access to both basic financing solutions and complex solutions with 360° value propositions. In addition, it has proactively managed companies with surplus cash.

This increase in business financing has been reinforced by a review of risk acceptance models. The purpose of this review is to be more proactive when offering financing solutions and to respond to requests more quickly. In addition, the new financial model based on binding limits enables the Bank to respond immediately to companies with turnover of between 2 and 10 million euros when they apply to renew or increase their financing, thanks to the support provided by the model and information already available.

For customers that are growing, Banco Sabadell has remained by their side with specialised lending solutions typical of the middle market, acting either alone or in a pool with other credit institutions. In this respect, structured finance transactions have been boosted in the areas of corporate finance, property and commercial real estate finance, LBOs, and project financing for energy and infrastructure. Services in the Investment Banking area have also been expanded, offering advice in transactions involving direct lending, M&A, bonds and commercial paper, among others.

Where sustainability is concerned, Banco Sabadell has participated in the market as a key player in the drive towards a more sustainable economy, providing finance for projects developed for purposes directly or indirectly linked to environmental, social or governance improvements. Thus, in 2024, the Bank increased financing for projects that pursue a purpose aligned with the EU taxonomy and financing linked to sustainability objectives.

2024 was also a key year for reinforcing the commitment to companies. February saw the launch of the Commitment to Companies, which translates the Bank's value proposition for Business Banking customers into a written summary of seven commitments delivered day after day. These commitments address what customers have asked for. Among others, they include professionalism, with a dedicated service team to manage operations and respond to queries expeditiously; support for customers, with a specialised business manager available for customers and always at their side; speed, by responding in less than seven days to financing requests and informing customers if a longer period is required for a decision; and, providing advice, with a team of experts, such as the International team, which is on hand to offer innovative solutions.

All this has been reinforced with a Communication and Media Plan to strengthen positioning and leadership in the Business Banking segment. In addition, the Bank has kept a continuous presence in economic, national and local media and has carried out a regional external events plan, as well as delivering the annual Banco Sabadell Business and Entrepreneur Awards in partnership with different editorial groups. Finally, Banco Sabadell is to participate, as a promoting brand, in the 7th edition of the National Industry Congress organised by the Ministry of Industry and Tourism. At the congress, Banco Sabadell will participate in two round-tables related to business sustainability and internationalisation, and will have its own stand. It will also participate in a round-table for CEOs, together with other brands promoting the event.

Banco Sabadell has been by the side of corporates, managing the full gamut of needs of its customers through sector-specialist managers in order to help them make the best financial decisions. These managers and companies have also received support from more than 200 specialists. In 2025, the sector-specific approach will be further enhanced, providing knowledge of the sector and of the market to customers, with a greater level of professionalism, adding more value and supporting companies in order to become their main financial partner.

Business

Banco Sabadell continued to support the daily activities and new projects of self-employed workers, small retailers and businesses, focusing on the development of the customer value proposition and making a concerted effort, as it does every year, to strengthen the Bank's position as a specialist in the minds of customers of this segment, based on the promotion and consolidation of a business methodology whose key component is a differential offering specifically designed for each activity sector.

The aim is to be able to offer each customer the solution that is best suited to them based on understanding the unique factors that shape their day-to-day activities, building a product offer by actively listening to customers and branch managers, professional groups and sector representatives, and ensuring that they really meet the identified needs. At present, the catalogue of specific solutions considers 34 different activity sectors, prioritising those that offer the greatest opportunity in the current economic environment.

In accordance with this sector specialisation framework and in order to apply it to the market in a tangible way, the approach to both existing and potential customers was enhanced during 2024, with the frequent launch of sector campaigns that, on one hand, serve to galvanise the commercial activity of specialist managers and, on the other hand, help to give a much clearer and more powerful message about the Bank's value proposition for this segment, by specifically targeting an audience with common needs and interests. Examples of this in 2024 include the "Management, Consultancy and Business Services" campaign, the "Small Retailers" campaign , or the "Hospitality, Bars and Restaurants" campaign, which have made it possible to make significant year-on-year increases in customer acquisition in these sectors under the concept of customer proximity as a common denominator, supported by expansion of the product range with innovations such as the Smart PoS, a smart payment terminal that can adjust to each user combining multiple applications, reinforced this year by the launch of new devices, including the Smart Dual-Screen PoS or the Smart Mini PoS, which can be mixed and matched, thereby maximising the ability to adapt payment solutions to each business, as well as the innovative "SoftPoS" app, giving the Bank's customers a PoS at their fingertips by installing the app on their mobile phone.

In addition, during 2024, relationship managers specialised in assisting self-employed workers, small retailers and businesses were once again the most numerous and representative management figure of the entire branch network, thus demonstrating the Bank's clear vocation for and commitment to a customer segment that attaches great value to proximity and personalised assistance by an expert manager. New features were added to the management support system available to these relationship managers, designed to help them better understand the key aspects of each sector, thus providing the best response to the specific needs of each one, including a university-accredited expert training programme on how to advise businesses and self-employed professionals.

In parallel and in line with the development and consolidation of new financial service consumption habits, Banco Sabadell continued to drive the digitalisation of customers during the year, both to respond to their

needs for self-service transactions and to enable new products and services to be arranged and managed remotely. On this topic, it is worth mentioning the significance of the launch in the first quarter of a digital channel to attract and engage self-employed customers, allowing the Bank not only to significantly increase its sources of customer acquisition but also to fill a gap in the market with a 100% online process, becoming a pioneer in the sector, and with the support of a new specific online account for this segment, offering the best conditions in the market.

In 2025, the main challenges in relation to this segment are strengthening the specialisation of both the offering and managers, consolidating a digital model for the management and engagement of self-employed customers that can guarantee the best customer experience by combining it with the capillarity of the Bank's branch network, and to continue to drive forward the sophistication of the value proposition in collections and payments as a key product for this segment.

SabadellUrquijo Banca Privada

Following the launch of a new Private Banking model in 2023, a key development in 2024 was the consolidation of that model. Banco Sabadell has set itself the objective of continuing to grow steadily in Private Banking and, to that end, it has undertaken an in-depth review of the value proposition, encompassing all products and services, making significant investments in technology, products, training and events, among other things.

The main growth vector has been the acquisition of new clients. With regard to the review of the value proposition, special attention has been paid to differentiated Private Banking products, such as alternative investments and discretionary portfolio management. In discretionary portfolio management, the launch of the Carteras Sabadell portfolios in April is particularly noteworthy, aimed at tailoring the service to customers' needs and upgrading its delivery relative to the Banco Sabadell Gran Selección funds, with one offer for the mass market, another for the Affluent segment and yet another specifically for Private Banking. Each one has different risk profiles and can be easily tailored to different customers, with the option of introducing a thematic bias in the portfolio and a selection of payment formulas to choose from. Improvements have also been made to the customer experience during the portfolio arrangement process and the option of setting up regular contributions has been introduced. Additionally, a new reporting regime has been launched and the process to contract the service and monitor portfolios using the internet or mobile app has been reviewed.

On the other hand, the Bank has continued to develop the advisory tool for bankers. This tool will allow us to improve the advisory services provided to customers and will also simplify the work of bankers so that they can devote more of their time to their clients.

With regard to the investment funds on offer, there are Sabadell Asset Management funds, with exclusive products for Banco Sabadell customers, and also Amundi Group funds, in addition to an extensive range of third-party funds. In 2024, the interest rate environment presented opportunities across the entire fixed income spectrum, from money market funds to target return funds. Because of this, the range of target return funds was expanded, offering different levels of risk. Additionally, a new range of 12-month guaranteed funds with daily availability of liquidity has been rolled out, which represents a novelty in the Spanish mutual fund market.

In terms of the transactional offer, products such as accounts and cards exclusively for Private Banking clients have been maintained, combined with the best services on offer in the Bank's product range. And with regard to financing products, Private Banking clients have continued

to have access to special prices, thus ensuring that these transactions remain competitive for those clients, where financing transactions are a differentiating element and help to capture new funds from those clients. In addition, the specific risk management workflows created in 2023 for staff specialised in Private Banking have been operating efficiently and with excellent transaction approval times.

Since the beginning of 2024, Urquijo Gestión, the Collective Investment Undertaking management company that offers a differentiated service to Private Banking clients, has implemented a new structure that has successfully achieved two objectives: it ensures consistency in the investment process, as investors have focused on market analysis and selection of the best investment opportunities; and, it has created a direct line of communication with each Private Banking territory. Portfolio managers in charge of client relationships have been placed on site in each territory to support the acquisition of new portfolios and to take part in periodic meetings.

These changes have enabled the attainment of some ambitious targets for asset growth and number of mandates for 2024 in the tailored discretionary portfolio management service, with the aim of increasing the prevalence of this service.

In terms of portfolio returns, the results across all risk profiles have been excellent, in both absolute and relative terms, that is, in comparison with the benchmark indices, thanks to the structural overweighting in equities and, specifically, the US stock market which has been supported by higher growth and productivity, and a careful selection of investments in both funds and securities.

Being close to clients is key for SabadellUrquijo Banca Privada. To achieve this, in 2024, more than 150 events and meetings were arranged, both in-person and online. These events addressed financial topics, through face-to-face chats and breakfast meetings where the outlook for financial markets was discussed, as well as other more leisurely events related to art, culture or sports. Many of these events took place in collaboration with Amundi and the Banco Sabadell Foundation. The Prado Museum of Madrid, the Guggenheim Museum of Bilbao and the Maestranza Theatre of Seville were some of the spaces booked for these events, which were highly rated by those taking part.

The improved value proposition has been reflected in customer satisfaction metrics that show that the level of clients' satisfaction with their asset manager has risen to 8.95 and the NPS has improved by 9 points.

This transformation was recognised by the Global Private Banker which awarded SabadellUrquijo Banca Privada the accolade of best Private Banking firm in Spain.

The Private Banking unit proved to be a driver for Banco Sabadell's growth, helping to position it as a leading institution in Spain when it comes to Private Banking.

Institutional Business

The goal of the Institutional Business division is to develop and enhance business with public and private institutions, positioning Banco Sabadell as a leading institution in this line of business.

Managing this line of business requires the specialisation of products and services in order to offer a comprehensive value proposition to public authorities, financial institutions, insurance firms and mutual insurance companies, as well as religious and third-sector organisations.

2024 was a very busy year for all institutional businesses. The high level of lending activity to government agencies and the management of customer funds in an environment of falling interest rates were particularly noteworthy. The financial sector has been very active and competitive in terms of funds acquisition, across all institutional

businesses. To respond to this new panorama in which the spotlight was on business profitability, Banco Sabadell strengthened its position in these segments, with increased commercial activity, greater proximity and a wider range of solutions, all of which resulted in an increase in customer acquisition, business volume and in the margin generated with its offering of products with more added value for customers and for the Institution.

Public institutions

Public institutions' economic activity in 2024 was marked by the growth of borrowing activity (due in large part to the needs of the autonomous communities), local authority and public entity investment plans, and by the cash surpluses held by the various government agencies.

The result was an increase in assets, as a result of greater lending activity, and a reduction in liabilities, due to high levels of competition for customer funds in the market.

Financial institutions and insurers

With regard to investments, 2024 saw an increased appetite for investments of longer duration, in view of the expectations of interest rate cuts in an environment of contained inflation. Investors continued to prioritise investments in bonds over alternative investments. Interest in deposits increased, with a clear preference for longer terms, in excess of 12 months. In fixed income, investors shifted away from government bonds to corporate bonds, in both the European core and peripheral markets and in emerging markets.

The Financial Institutions and Insurers division has carried out strategic account management in this segment, adapting the new lower rate of account remuneration on a discretionary basis and according to customer interconnectedness, above all in terms of transactionality. This interconnectedness has facilitated the marketing of value added products for these institutions. Various portfolio management mandates have been obtained as a result. In 2024, both the Crisae senior debt fund and the Aurica IV private equity fund (marketed by Banco Sabadell) took positions in some interesting operations. Lastly, infrastructure operations brought to market in relation to renewables and real estate with customers in this segment are worthy of note.

Religious institutions and the third sector

The Religious Institutions and Third Sector division offers customers a range of products and services adapted to the unique characteristics of these groups. They cover everything from transactions to specialist advice on financial assets.

Uptake of the DONE system for collecting charity donations, which works with contactless technology, continued to grow throughout the territory, helping non-profit organisations to raise funds for their projects.

The Religious Institutions and Third Sector division coordinated the delivery of financial aid for the charitable causes supported by the Sabadell Inversión Ética y Solidaria, FI fund, managed by Sabadell Asset Management, and it also managed the payments made together with beneficiary offices and entities. This year, support was provided to 23 charity projects selected by the Ethics Committee in 2023. A total of 234,703 euros was delivered to those projects. Furthermore, in 2024, the Ethics Committee selected a total of 24 humanitarian projects primarily focused on addressing risks of social and labour exclusion, improving the living conditions of people with disabilities and meeting their basic needs in terms of food, healthcare and education. Sabadell Asset Management will distribute this aid to these projects in 2025.

Segment specialists

Franchising

Banco Sabadell was the first financial institution in Spain to adopt the franchise system. For 28 years, its Franchising division has supported both franchising brands and their franchisers, consolidating itself as a leader and standard-bearer in the sector. This sector, which is becoming increasingly professionalised, has seen constant growth in revenue, job creation and number of brands.

Banco Sabadell currently has more than 11,000 franchising customers, working with more than 1,300 franchised brands, most of which have signed collaboration agreements. The Bank offers a wide range of products and services specifically designed for this sector. These collaboration agreements include preferential terms and conditions in terms of financing, transactionality and security, managed through the branch network with the support of sector-specialised franchise managers.

The Franchising division has been transformed into a partnership model that is key to business generation and customer satisfaction, in order to achieve synergies, energise the commercial offer and increase business generation. This has entailed a radical change to boost collaborative work with other cross-cutting divisions of the Bank, identifying new business opportunities and creating global value propositions for the customer.

Banco Sabadell works closely with the Spanish Franchisors' Association (Asociación Española de la Franquicia, or AEF) and was the first bank to secure a partnership with this association and together they drive this business model.

In 2024, the Sabadell Franchising division took part in several important initiatives organised for the franchising sector:

• Presence at different editions of the 'Franquishop' event, held at various locations.
• Participation in the 1st edition of the Franchise Innovation Summit (FIS).
• Sponsorship of the National Franchise Awards in Spain.
• Promotion of research, such as that carried out by the Franchise Case Law Observatory (Observatorio de la Jurisprudencia de la Franquicia).

In addition, Sabadell Franchising has published articles in the press and in specialist magazines, collaborating with different franchising experts, and has carried out numerous activities disseminated through social networks. These initiatives reinforce Banco Sabadell's renown and leadership in the franchising arena.

Agriculture segment

In 2024, Banco Sabadell's Agriculture Segment, which includes the agriculture, livestock, fishing and forestry production subsectors and has more than 300 specialised branches, increased its customer base, as well as the portfolio of specific financial products and services with features tailored to the demands of customers in the sector.

Banco Sabadell's firm commitment to this sector, in particular through its personalised customer support, led to a significant increase in business compared to 2023, with customers continuing to put their trust in the Bank, and this has been reflected in an increase in the customer base compared to the previous year.

During 2024, Banco Sabadell's Agriculture Segment participated in three agrifood fairs and sponsored 51 events throughout the nation.

Banco Sabadell's Agriculture Segment has the clear objective of accompanying customers in this sector in their digitalisation and sustainability activities, taking advantage of the efficient lever that will be generated by the Next Generation EU funds.

Hotel and tourism business

Back in 2013, Banco Sabadell became the first Spanish financial institution to specialise in the tourism business in order to understand, identify and adapt to the needs of Spain's top sector in terms of contribution to GDP, namely the tourism industry. The Bank has consolidated itself as one of the top banks, a leader in the sector, offering expert advice with the highest standards of quality.

The value proposition is primarily based on offering specialised financial solutions to a group that is highly fragmented and not very homogeneous. This value proposition is built on three basic pillars: expert advice, a specialised product catalogue and a rapid response.

2024 was an exceptional year for the tourism industry in Spain, with more than 88.5 million international tourists. The upshot of this has been an increase in average daily spending, number of overnight stays and occupancy rates. Banco Sabadell's Tourism Business division achieved its highest ever level of financing with more than 1 billion euros provided, and it will continue to support both new projects and the upgrading and repositioning of existing hotel sector stock.

The Tourism Business division also has the institutional recognition and participation of leading entities in the industry, as a voting member on the board of Spain's Tourism Council (Consejo Español de Turismo, or Conestur), the Tourism Commission of the Spanish Confederation of Business Organisations (Confederación Española de Organizaciones Empresariales, or CEOE) and the Tourism Commission of the Spanish Chamber of Commerce.

As it does every year, Banco Sabadell was present at the main international tourism fair (FITUR) with its own stand. More than 70 Banco Sabadell employees took part in running the stand, which received its highest ever number of visitors. These visitors hailed from companies in the hotel sector, travel agencies, hospitality sector suppliers and consulting companies.

Sustainability has been established as a core pillar of the development and transformation of the tourism industry. The Bank incentivises the tourism industry and companies operating in it to attain sustainability objectives by asking them to agree to certain commitments based on metrics linked to ESG targets by means of a document annexed to financing contracts.

Sabadell Professional

Banco Sabadell has established itself as a leader in the management of agreements with professional and business associations and bodies at the national level. Its differentiation stems from the close relationship it has with these organisations, based on the support and commitment of Sabadell Professional managers. The core mission is to cater to the needs of professional bodies and associations and their members, through a range of specific and differentiated financial products and services.

In 2024, Banco Sabadell signed more than 400 agreements with professional associations and bodies throughout Spain, a reflection of its commitment to cooperation. It also participated in more than 700 events, forums and workshops, organised jointly with those associations and bodies. This participation not only strengthens its relationships with professional bodies and associations but also facilitates the acquisition of new customers through the branch network and through managers, with an offer that is adapted and relevant to professional customers.

Banco Sabadell maintains strategic positioning in the homeowners' associations and licensed property management segments, which are highly profitable and important sectors for the Bank. These customers benefit from a value proposition focused on improving their day-to-day operations and offering an optimised management experience, for both customers and branch managers. Additionally, financing for property refurbishment has increased significantly, supported by the Next Generation EU funds, which has further strengthened the commitment to the sector.

The Sabadell Professional segment enjoys market recognition, particularly among professional associations, consolidating the Bank's reputation as the "professionals' bank". Over the years, it has received various awards and accolades that are testament to its commitment to the sector, reinforcing its vocation to provide services for companies and professionals. The Bank's strategic decision to focus on this segment is consistent with its mission to support Spain's economic and social development.

This commitment drives Sabadell Professional to maintain strong, close and lasting relationships with professional bodies, which are considered to be essential agents in the economic and social development of the country. This focus continues to steer the management of Sabadell Professional, establishing it as the preferred partner of professional bodies and their members throughout Spain.

Real estate business

The Real Estate division focuses on comprehensively developing the residential real estate development business through a specialised and highly-consolidated management model.

2023 was a year marked by product shortages, affecting the level of real estate developer sales and, therefore, the volume of completed deals. By contrast, the initial forecasts were surpassed in 2024 and expectations for 2025 are promising.

The Investment Property division focuses its efforts on generating new business and consolidating the completion of residential properties so as to minimise any potential negative impact, as well as monitoring sales in progress.

The main strategy is to maintain the Bank's leading position in the sector, a position that exceeds its expected share of business in the segment, and to consolidate its market share, prioritising the best business opportunities by pinpointing the most notable projects and most solid customers, minimising risk and maximising profit for Banco Sabadell.

BStartup

Banco Sabadell's BStartup, a pioneer in the Spanish banking industry, is a company offering financial services for startups and scaleups. A unique project launched 11 years ago, it offers a 360° service of specialised banking and equity investment and plays a very active role in the country's innovative entrepreneurial ecosystem.

Specialising in banking has been BStartup's mainstay from the outset. Its customers have a strong level of engagement, they are very international and their activities are often complex; they come from all segments and all sectors and they have differentiated business models, development pathways and financing needs. At present, the specialisation is essentially based on a team of managers dedicated exclusively to startups and scaleups in the Territorial Divisions with the highest concentration of this type of company, with its own risk

management workflow and a team of four specialists that drive the business throughout Spain.

It ended the year with the launch of the BStartup Hub Madrid, the first Banco Sabadell branch dedicated exclusively to startups and scaleups and their investors. A space of more than 600 square metres for entrepreneurs and technology, accommodating a team of 12 professionals who offer a 360° financial service and who are 100% specialised in startups at all stages. A new open multi-purpose space for Madrid's entrepreneurial ecosystem which seeks to be a meeting place for the startup community with its auditorium, meeting rooms and customer hotdesk.

In terms of equity investment activity, BStartup is aimed mainly at seed-stage tech-related companies with strong growth potential and with scalable and innovative business models. BStartup invests in all types of sectors, above all in digital companies, and focuses on two specific verticals: BStartup Green for startups which, through technology or digitalisation, are able to facilitate the transition to a more sustainable world, and BStartup Health, already a firm leader in investments in healthcare industry startups in the early stages of bringing science to market in Spain (7th call, 105 companies analysed). This year, it has invested in 7 startups, meaning that the BStartup10 portfolio of investees now totals 71 and is already yielding significant returns and a very positive valuation. During the year, three startup holdings were sold outright.

Over the year, BStartup's team organised or actively participated in 106 entrepreneurship events in 17 Spanish cities. This, together with all the activity mentioned above, continues to reinforce Banco Sabadell's reputation and positioning as a leading bank for scaleups and startups. As a reference indicator, BStartup has had 1,697 mentions in the media (print press and online), has amassed 13,710 followers on X, and BStartup has been one of the trending topics about the Bank on social media every month, always with a positive sentiment.

Sabadell Partners

The activity of Sabadell Partners as a customer acquisition lever, through partnership agreements with referral agents, is focused on providing services to the commercial banking branch network, the business banking network and the private banking arm, offering value propositions to facilitate access to Banco Sabadell's range of financial solutions, seeking customer satisfaction and referral agent satisfaction, at all times, as well as service excellence.

The sustained growth over time of the Sabadell Partners division means that it played an essential part in the mortgage results generated in 2024, reaching 42.1% of the Bank's total mortgage origination. Sabadell Partners' top branches deserve special mention, due to the significance of their contribution to new transactions, stemming from their expert advisory services and their specialisation in managing relationships with key mortgage partners.

Commercial products

Business services

Payment services

2024 was a year of innovation in payment services. In the month of May, the Smart Mini PoS terminal and the Smart Dual-Screen PoS terminal were added to the product catalogue, thereby creating a range of smart PoS terminals that can not only manage payments but also offer add-on loyalty, order management and tax free apps, among others. Another new feature is the inclusion of Instant Credit in the Smart PoS, an application developed by Sabadell Consumer Finance which allows retailers to offer all their customers, even those who are not Banco Sabadell customers, instant credit on purchases. In October, the PoS service was incorporated into mobile phones; just using a single application, an Android phone with NFC can be converted into a PoS terminal, thereby bringing access to PoS terminals to many more customers.

The volume managed continues to grow, driven by this increase in terminals and by the boost in national consumption and international tourism, which continues to grow at double digits.

In January 2024, the PoS business was spun off to the subsidiary Paycomet, which is specialised in payment services, as a step prior to the sale of that subsidiary to Nexi under the strategic alliance agreed between Nexi and the Bank with the aim of promoting innovation in a product that is key to its customer relations. This transaction is expected to close in 2025, once the outcome of BBVA's tender offer to acquire all shares issued by the Bank is known, as indicated above in this consolidated Directors' Report.

Corporate credit cards

Turnover in credit card purchases and the margin on corporate credit cards continue to grow, posting a cumulative year-on-year change of 9.1% y 3.1%, respectively. As the use of cards becomes more widespread among its business customers, Banco Sabadell continues to work to offer a value proposition that is competitive in the market and that meets its customers' needs.

Company insurance

To maintain its position as a leading provider of risk insurance for companies, in 2024 Banco Sabadell worked to provide a comprehensive and competitive product range with high-quality service. It developed its value proposition for self-employed customers and small businesses, enhancing its specialisation in each sector and adjusting the offering to the specific needs of each industry. In particular, the specialised product offering for companies in the agricultural sector was expanded, adding new multi-risk insurance and livestock protection products. It also worked to make its multi-risk protection products for small retailers and businesses more competitive. The team of specialist managers in Company Insurance, located throughout Spain, has continued to be consolidated during the year and was also strengthened with product and support training for the existing insurance policies service.

During the year, the focus was placed on personal protection products, with life insurance and health insurance products aimed at management staff and employees of the Bank's business customers, offered in the form of both fringe benefits and flexible benefit plans. Equity protection products (multi-risk, civil liability and specialised products)

continue to be the core products for Banco Sabadell customers, essential to protect their assets and liabilities vis-à-vis third parties.

Retirement planning

Through the Retirement Planning unit, Banco Sabadell Group offers solutions and responses to customers to help them better implement, manage and develop their retirement planning systems through pension plans and group insurance policies.

In 2024, the demand for retirement planning systems in companies continued to grow, particularly demand for collective retirement insurance and joint pension plans among small and medium-sized enterprises. Part of the business comes from tender processes and bids through consultants, with an increase seen in demand and business generated through this channel.

Both in collective retirement insurance and in pension plans, it is worth noting, as an innovative and unique solution in the market, the life cycle-based investment policies that complement its profiled investment funds.

It is also worth calling attention to the Sabadell Flex Empresa product, available across the branch network. This product consists of a fully digital platform for flexible benefit plans that allows companies to optimise their remuneration model, at very competitive prices. It is a solution that enables managers and employees to maximise their savings and increase their net disposable income by optimising its taxation.

Business finance

In terms of short-term financing, credit facilities have evolved positively since January 2024.

With regard to other working capital financing products, in 2024 the growth of reverse factoring was noteworthy, with market share increasing in a declining segment. In particular, the signature of sustainable reverse factoring transactions was noteworthy. The needs of companies to finance their day-to-day payments and collections has led to greater use of specialist financing solutions, such as factoring and, above all, reverse factoring, which is becoming increasingly important among the different facilities used by companies. By sector, the manufacturing industry has, by far, the greatest weight in the factoring business line.

With regard to the medium and long term, new loan origination grew significantly in 2024 compared to 2023, being particularly relevant in miscellaneous loans and, specifically, in the Corporates segment and the public sector.

In terms of financing for purposes aligned with the Bank's Sustainable Financing Framework, as at year-end 2024, the Bank had mobilised 4.5 billion euros for projects related to renewable energies, energy efficiency, sustainable transportation and water & waste management in the year, surpassing the 2.4 billion euros mobilised in 2023 for the same purposes.

As part of its commitment to support businesses in their transition towards decarbonisation, Banco Sabadell also offers financing linked to the Company's sustainable development goals, which encourages the inclusion of sustainable goals in their business strategy. As at the end of 2024, more than 3 billion euros of financing of this kind had been mobilised.

Banco Sabadell works hard to ensure that customers take full advantage of European funds, through the dissemination of information at Sabadell Companies Hub sessions, or using tools such as the public aid advisory search service or agreements to facilitate guarantees and complementary financing for PERTEs (strategic projects for economic

recovery and transformation), for example in the shipbuilding industry, providing funding for innovation and sustainability projects.

Leasing and rental of capital goods

Demand for leasing products in 2024 has increased considerably compared to the previous year, with a substantial increase in the Bank's market share (according to data published by the Spanish Association of Leasing and Renting, or AELR by its Spanish acronym), prompted by greater demand for business financing, by the signing of one-off highvalue transactions and by the improved offer in specialised segments and in sustainability. The number of contracts has also increased since the previous year, albeit not as significantly as transaction volume.

In terms of rental of capital goods, these transactions have decreased both at the sector level and from the Bank's side, the drop being particularly significant in capital goods related to IT and tourism.

As regards sustainability, a high percentage of the investment arranged through the leasing and rental of capital goods qualified as sustainable lending.

Vehicle leasing

Having brought stock levels back to normal over the year, efforts have been channelled into offering a tailored product for customers of the Bank that operate large fleets.

This offer is accompanied by advice from specialist vehicle leasing managers throughout Spain, to offer the best solution for those companies, including sustainable alternatives.

Growth has been observed in the self-employed and individual retail customer segments as a result of the uncertainty generated by the transition towards much more sustainable mobility models.

Official agreements and guarantees

The Official Agreements and Guarantees division continues to manage agreements with various public bodies with which the Bank maintains a relationship. The Bank has signed new partnership agreements that enable it to meet the financing needs of its customers.

These agreements include both national bodies (ICO, mutual guarantee societies and/or autonomous community entities) and supranational institutions, such as the European Investment Bank (EIB) and the European Investment Fund (EIF).

The Bank opted in once again this year to the ICO's second-floor facilities and to the new home rehabilitation facility currently being developed for homeowners' associations, offered to the market since January 2024.

In September 2024, Banco Sabadell signed up to offer the new ICO MRR (Mechanisms for Recovery and Resilience) credit lines for Companies and Entrepreneurs and the ICO MRR Green line. Thereafter, in December, it signed up to offer the ICO MRR Social Housing Rental credit line.

Banco Sabadell was the first institution to sign credit operations using the ICO MRR credit line, for a total of 60 million euros as at 2024 year-end, implemented through 180 loan operations, and it collaborated actively with the ICO to develop the procedures for this line and the MRR Banking platform.

In November, the Bank signed up to offer the ICO DANA line, to provide solutions for customers affected by the flash floods in Valencia. This credit line was developed with the aim of making all methods of banking available to the branch network, providing direct support to the network in order to help customers in this particularly vulnerable and sensitive situation.

The Bank's agreements with Mutual Guarantee Societies (MGSs) operating in Spain were also revised.

In 2024, a very large number of applications for the various EIB facilities made available to customers was submitted. In September 2024, a new special agreement was signed with the EIB and the EIF to offer 550 million euros of new finance to SMEs and ecological projects in Spain.

The aim for 2025 is to stand out in terms of the Bank's market share of ICO facilities through the ICO MRR lines, which enable it to offer customers products with the best terms and conditions to fund their projects.

International

In 2024, the International Business division's activities concentrated on three major areas.

Firstly, capturing working capital transactions in the international segment, both in terms of the products most typically required by companies, such as import/export financing and international factoring, and in terms of the consolidation of working capital facilities and international guarantees covered by CESCE, which are more complex but offer more added value for businesses. This has allowed us to meet the most stringent needs of customers and to play an active part in the international collections and payments that are linked to the financing.

Secondly, improving the customer experience in digital business services with the redesign of international transfers carried out via BSOnline, which has led to a much more intuitive interface for businesses and allows the real-time download of swift supporting documentation for customers, enabling us to improve service quality and optimise delivery times both for the businesses and managers involved. The customer experience has improved rapidly as a result.

Thirdly, mindful of the importance of specialisation and of continuous international geopolitical changes, the Bank has focused on company training with the 7th edition of the Sabadell International Business Program, which was a resounding success, as it has been every year since its inception, in which companies were taught, in a hands-on fashion, how to create an internationalisation plan. The Bank also focused on training its International Business managers who have completed the ESIC PEXNI (Programa Experto en Negocios Internacionales) programme, which gives them access to a unique qualification in Spain as specialists in international business, producing a very high level of expertise in the relationship between our specialists and the companies they work with.

In terms of international business in documentary transactions, the Bank continues to have a very high market share in this field, but this year it has also increased its volume of import letters of credit, demonstrating the high level of quality offered by the Institution in more complex transactions.

At the market level, it should be noted that the Bank has demonstrated that it can adapt to more complex markets, such as Algeria, which used to be a closed market for Spanish companies but which has partially opened up to certain sectors where the Bank responded quickly to win back value added transactions with customers interested in this market.

In addition, the Bank has played an active part in a new initiative of the Spanish Chamber of Commerce to develop mentoring in foreign markets, aimed at a number of Spanish companies associated with that Chamber of Commerce. The Bank developed support plans for a wide range of markets, including China, Morocco, Turkey, United Arab

Emirates and Europe. The initiative was very well received by the companies involved and the work carried out in partnership was of a very high quality.

In terms of visibility, reporting and training for companies, the Bank has pursued the dynamic of initiatives carried out by the International Business division at the Companies Hub sessions held on Wednesdays, with discussion of matters including logistics, foreign markets and foreign trade products; these events continue to generate a very high level of interest. 14 events were held with more than 4,000 participating companies.

Corporate & Investment Banking

Business overview

Corporate & Investment Banking is the business unit that offers financial solutions and advisory services to corporates and financial institutions, both in Spain and internationally, with a presence in 12 countries.

It is one of the Bank's three core units, alongside Retail Banking and Business Banking. It is a division structured around the different needs of customers and the capabilities of each of these three distinct banking business lines to best meet those needs.

It structures its activity around two pillars, the first of which is the customer. It aims to serve its customers who are natural persons to meet the full range of their financial needs. This pillar is determined by the nature of those customers and includes large corporations classed under the Corporate Banking umbrella, financial institutions, Private Banking customers in the United States and, secondly, the specialised businesses, which group together the venture capital business run through BSCapital, and the activities of Structured Finance, Treasury, Investment Banking, and Trading, Custody and Research. Its goal is to advise, design and execute custom operations that anticipate the specific financial needs of its customers, be they companies or individuals, with its scope of activity ranging from large corporations to smaller companies and customers, insofar as its solutions are the best way to meet their increasingly complex financial needs.

Management milestones in 2024 and priorities for 2025

Corporate & Investment Banking remains focused on prioritising the creation of value for its customers, thus contributing to their growth and future earnings. To do this, it has continued to innovate and promote its specialist capabilities, fundamentally in the areas of investment banking and structured finance, which are able to continue meeting 100% of their customers' financial needs. The Bank's teams are constantly improving and expanding their international reach, always focusing on those markets in which its customers invest or have commercial interests.

The key areas in which it works to create value for its customers are the following:

• Knowledge: the Corporate Banking teams, located in the different countries in which the Bank operates, have not only specialisation in the large corporations segment but also knowledge and penetration differentiated by activity sectors in order to better understand and serve customers according to their own and their sector's singular characteristics.
• Coordination: unique and specialised solutions are required to meet the needs of large corporations, and these can be provided as a result of the participation and collaboration of several areas within the Bank (specialist teams and even teams operating in different geographies). Coordination between all these teams is crucial for providing and bringing value to customers.
• Specialisation: there are units that develop custom products for large corporations and financial institutions (Corporate Finance, Project Finance, Project Bonds, Syndication, Commercial Paper Programmes, Debt Issuance, M&A, Asset Finance, Derivatives, Risk Hedging, etc.). The units responsible for developing this entire range of products do so for the entire Banco Sabadell Group, extending their capabilities to the Corporate and Institutional Banking segment.
• Innovation: transitioning from idea to action is vital to grow in such a dynamic and demanding market as that of specialised lending and large corporations. The necessary spaces and mechanisms are

created to allow teams to dedicate part of their time to innovation, understood in its broadest sense: innovation in products, in operations and also in the way of collaborating and interacting with others.

— Sustainability: customers are offered support and advice to move towards a more sustainable economy, generating solutions through specialised products and services.

As regards the measurement of the key figures regarding the performance of Corporate & Investment Banking, the focus is placed on monitoring the income statement (monitoring net profit in general and the main revenue items in particular), return on capital (ROTE and RAROC metrics), strict risk tracking and monitoring, as well as proactive action when faced with early signs of potential impairment.

Lastly, the priorities for 2025 are set out in detail in the following sections of this report.

Customer pillar

Corporate Banking Europe

Corporate Banking Europe is the customer unit, within Corporate & Investment Banking, responsible for managing the business segment that caters to large corporations which, given their size, uniqueness and complexity, require a tailored service, complementing the range of the more traditional financial products and transaction banking products with services provided by specialised units, thereby offering an end-to-end solution to their needs. The business model is based on a close and strategic relationship with customers, providing them with end-to-end solutions adapted to their needs and requirements, taking into account the specific aspects of their economic activity sector and the markets in which they operate.

This unit covers various branches, notably including the London, Paris, Casablanca and Lisbon foreign branches, which support and cater for the international activity of domestic customers and where the international Corporate Banking business is carried out.

2024 was characterised by active customer support focused on seeking optimal solutions to restore stability to their financial profiles, adapting those solutions to their needs, in an environment of slowing inflation and gradual stabilisation of interest rates, above all in the second half of the year.

As a consequence of this active support, volumes of lending in Corporate Banking Spain have increased by 18.23% compared to the previous year. Similarly, at the international level, at year-end lending had increased by 16.31% in comparison to the previous year.

As for profitability, Corporate Banking Europe had a ROTE of 18.04% as at the end of December 2024 (an increase of 306 basis points compared to December 2023).

2025 presents a number of opportunities, among them the progressive lowering of interest rates in the Eurozone, which has already happened during 2024 as a result of the gradual containment of inflation, which directly affects consumption and production. Corporate Banking is tackling these challenges by supporting its customers at both the national and international levels, with a product offering that covers 100% of their financing requirements, both in the short and long term, to deal with this new macroeconomic situation.

The contribution of value to customers in the large corporations segment and the improved profitability for shareholders are the two fundamental management pillars of this unit, which next year will continue to focus on optimising capital consumption, with the aim of increasing the return on capital employed.

Corporate Banking and Private Banking USA

2024 marked Banco Sabadell's thirty-first year operating in the United States through its international full service branch in Miami and through Sabadell Securities USA, which was set up in 2008 and has been operational ever since. These units manage the financial business activities of corporate banking and international private banking in the United States and Latin America.

The Banco Sabadell Miami Branch is the largest international branch in Florida. It is one of the few financial institutions in the area with the experience and capability to provide all types of banking and financial services, from the most complex and specialised services for large corporations to international private banking products, including the products and services required by professionals and businesses of all sizes.

To supplement its structure in Miami, the Bank has representative offices in New York and in the Dominican Republic.

Sabadell Securities USA, for its part, is a stockbroker and investment advisor in the securities market that complements and strengthens the business strategy aimed at private banking customers residing in the United States, meeting their needs by providing advice on investments in capital markets.

2024 unfolded in an environment of uncertainty in the US macroeconomic context, with a clear focus on the evolution of inflation and levels of unemployment, which prompted the Federal Reserve to start bringing down the official base rate. Ultimately, US interest rate cuts did not begin until the final quarter of the year.

With an asset balance that had already captured the interest rate rises from the previous year, the branch has seen its net interest income fall over the year, despite highly disciplined price control on deposits. Following on from 2023, the high level of interest paid in the banking market and the competitive rates of US treasury bills triggered a migration of balances from non-interest-bearing deposits to money market accounts, term deposits and to investments in securities that offered higher yields. This process resulted in an increasing average cost of deposits.

In addition, although the composition of customers' investment portfolios was focused on investments more heavily weighted in funds with exposure to US treasury bonds, causing a slight reduction in the average fees received on these portfolios, the international Private Banking business continued to grow its fee income through other types of fees and commissions: structured products, transaction fees and advisory services for customers.

The process of operational improvements continued during 2024, with completion of the second stage of the project to update the IT platform in order to improve the features available to customers and to the business and support units.

With regard to the key financial figures, in an environment of considerable uncertainty over the projected performance of the US economy, the volume of business increased by 10%.

The private banking business was a mixed bag, with a slight reduction in deposits and a 10% increase in portfolios of investments in securities.

As a consequence of higher interest rates, the corporate banking business was impacted by the increased volume of loan prepayments. Despite the above, this business unit increased lending by approximately 20%, meeting the targets set out in the Growth Plan to grow in target segments with appropriate profitability, which has also helped to generate fees and commissions at levels similar to the previous year.

In any event, net interest income in the year grew by 1% compared to the previous year, on the back of the growth in business volume and good liabilities management. As for the net fees and commissions generated, these have increased by around 8% compared with the previous year. All

of this benefited gross margin which, combined with a contained reduction of administrative and amortisation/depreciation expenses, had a positive impact on net profit, which grew 7% compared to the previous year.

Specialised businesses

Structured finance

The Structured Finance division encompasses the Structured Finance and Global Financial Institutions units. This division operates globally and has teams in Spain, the United States, the United Kingdom, Mexico and France.

Structured Finance's activity focuses on the study, design and origination of corporate finance products and transactions, leveraged buyouts (LBOs), project & asset finance, global trade finance and commercial real estate, with the capacity to underwrite and syndicate transactions at the national and international levels, as well as being active in the primary and secondary syndicated loan markets.

The Global Financial Institutions unit manages the commercial and operational relationship with the international banks with which Banco Sabadell has collaboration and correspondent agreements (some 3,000 correspondent banks around the world), thus guaranteeing maximum coverage for Banco Sabadell Group customers in their international transactions. This allows it to ensure it provides customers with optimal support in their internationalisation processes, in coordination with the Group's international network of branches, subsidiaries and investees.

In 2024, thanks to its policy of supporting customers and adapting to their needs so as to seek the best way to meet their credit requirements within the possibilities offered by the credit markets in the specific macroeconomic environment, Banco Sabadell has improved its leadership position in Spain, as well as in Mexico and the United States, and is now reviewing its positioning in UK, France and Portugal, with the aim of increasing activity in these geographies and becoming more active in European one-off transactions.

The Bank's top priority continues to be supporting customers by designing long-term financing structures for new projects, acquisitions and internationalisation, among other things, as well as syndicated transactions that ensure stable and complete debt that can be restructured, where appropriate, assessing the positive potential of possible solutions combined with investment banking, Treasury or BSCapital products, to which end the development of a better commercial system, carried out jointly with Business Banking and Corporate Banking, is essential.

BSCapital

BSCapital carries out the Group's venture capital and private equity activities. Its activity is articulated through the acquisition of temporary shareholdings in companies and venture capital funds, with the aim of maximising the return on its investments. In addition, it also offers support to companies through alternative financing (senior debt fund, venture debt or mezzanine loans).

BSCapital actively managed its portfolio, engaging in its traditional capital and debt-related activities, with the materialisation of investment and disinvestment operations and portfolio revaluations.

It has continued to apply a strategic focus to its investments in private equity funds, the divestment of some of the most significant Aurica III fund investees being particularly noteworthy. The Aurica IV fund, of which Banco Sabadell is anchor investor, continues to make new investments.

BSCapital continues to carry out transactions guaranteed under the InvestEU programme for renewable loans, venture debt and mezzanine

facilities granted by the European Investment Fund (EIF). It is also making use of the co-investment framework with the European Investment Bank (EIB) to grant venture debt to scaleups.

In renewables, it continues to seek investment opportunities suited to the current action framework, focusing on Spain and Latin America, and it is analysing potential asset sales. It is also working on the definition of a new action framework for the next five years.

The debt fund Crisae continues to originate and execute transactions to offer funding to companies in the Spanish midmarket. Banco Sabadell Group and institutional investors have a stake in Crisae and the fund's investment commitments increased during 2024.

Throughout 2025, BSCapital will continue to invest in capital and debt, with the support of international bodies such as the EIF and the EIB, and it will continue to focus on optimising capital consumption. It will also continue to manage the current portfolio to generate long-term value.

Funding opportunities will continue to be sought, in accordance with the frameworks of investment in mezzanine debt and renewable energies, with the expansion of the latter.

Focus will be placed on venture debt activity and the rotation of the venture capital portfolio through divestments that produce capital gains.

Crisae will continue to originate and execute transactions aimed at increasing the size of the debt fund, as well as manage the current portfolio.

Treasury & Markets

Treasury & Markets is responsible, on one hand, for structuring and selling treasury products to the Group's customers, through the Group's units assigned for this purpose, both from commercial networks and through specialists and, on the other hand, for managing the Bank's short-term liquidity, as well as managing its regulatory ratios and ensuring they are compliant. It also manages the risk associated with the trading of interestrate, forex and fixed-income products, which mainly arises due to flows of transactions originated by the activities of the structuring and distribution units with both internal and external customers, and by activities related to short-term liquidity management.

In 2024, the Treasury and Markets division continued to work on the digitalisation and optimisation of its transactions with customers, seeking to expand its range of services and improving customer experience. Furthermore, the division continued to expand the range of products and solutions it has on offer, adapting it to new customer needs arising from a changing market. In terms of trading, the capacity to take on and control various risk factors such as currency, fixed income and interest rates was enhanced.

As for distribution activity in 2025, activity related to foreign currency products is expected to continue being a core pillar of the strategy, although work will continue to increase the range of other available underlying products so that customers may manage their risks more efficiently. With regard to commercial segments, the focus will be placed on increasing capacity in order to provide services to large enterprises and corporates. In trading activity, the aim is to continue to build up the capacity to manage risk in the Bank's own books, reducing hedging transactions with other institutions, and to continue to improve collateral management in order to obtain the highest possible returns.

Investment Banking

Investment Banking forms part of the Corporate & Investment Banking division, which offers the Bank's customers value added products and services that do not involve the Bank's balance sheet. The activity of this division can be broken down into three different teams:

The Corporate Finance division, which combines the following activities: (i) Mergers & Acquisitions (M&A), (ii) Equity Capital Markets (ECM) and (iii) Alternative Financing.

The activity of Mergers & Acquisitions consists of offering advice on company acquisitions and sales, corporate mergers and the incorporation of new shareholders.

In an environment where differences between the price expectations of buyers and sellers were particularly high, the Bank advised in an acquisition carried out by a venture capital fund that is specialised in boosting SME growth and is a leader in its sector in Spain. Support from the Bank's different funding units in raising debt financing enabled this transaction to take place successfully.

Conversely, the sale of a company in the manufacturing sector has provided continuity to a business project faced with uncertainty around the succession of its founding shareholders, and will thus enable the business to grow.

On the other hand, the activities of the Equity Capital Markets division include, among others, activities related to corporate capital transactions and IPOs.

Particularly noteworthy in 2024 was its participation as co-lead manager of the underwriting syndicate in an IPO that proved to be Spain's largest since 2015, with a transaction value of approximately 2.5 billion euros, combining a capital increase and a share offering. Also noteworthy in the year was the participation in an accelerated share placement for more than 900 million euros by one of Spain's largest office owners.

Lastly, the Alternative Financing division coordinates the channelling of liquidity of institutional investors wishing to take on risk in situations where banking institutions typically do not. Investment Banking continues to focus on offering tailor-made financing solutions, in any format, in various sectors, from real estate to infrastructure, focusing particularly on renewable energy projects and corporate finance in the domestic midcorporates segment.

All the above activities were merged into one single division, Corporate Finance, to offer Banco Sabadell customers all of the valueadded solutions available according to their corporate needs, in terms of both capital and debt.

The second division, Debt Capital Markets (DCM), encompasses activities involving the origination and structuring of public instruments in trading markets. In terms of the Bank's participation in transactions involving corporates, those involving public sector and financial issuers, in both long- and short-term financing operations, with a particular focus on sustainability label issues, are considered particularly noteworthy. One of the markets in which the Bank is most active is that of commercial paper programmes, participating in the programmes of 50 different issuers. Another of the core pillars of this activity is the closing of niche transactions, such as securitisations.

In 2024, in view of expectations that interest rates would fall, the DCM division suffered the withdrawal of some investors who, in many cases, decided to postpone the issue of bonds and debentures. In addition, high interest rates have also affected investor appetite for existing commercial paper programmes, due to alternative investment products offering high yields.

However, the division has continued to make the most of opportunities that have arisen, such as the corporate activity in France, where it participated in a number of transactions, which is all the more striking in view of the limited presence of the Bank's balance sheet in that country. Also noteworthy is its participation in debt issues of the autonomous communities, where record breaking volumes were achieved.

Lastly, the third division, Syndicate and Sales (S&S), encompasses the distribution of private debt originated by Structured Finance teams among banking and institutional investors, both domestic and international, following the originate-to-distribute philosophy.

The division faced a year of stiff competition in this area of activity, as the appetite for funding bilateral transactions with corporates increased; in view of this, the division pivoted towards increasing its share of secondary market purchasing activity, thereby also increasing the credit exposure of the Bank's balance sheet.

Nevertheless, it continued to play an important role in primary market transactions, with the underwriting and sale of LBOs, or the placement of infrastructure projects among banks and underwriters.

On a separate note, it has continued to seek alternative third-party financing for certain corporate customers' investment projects, increasing the number of providers approached for this type of financing and reaching new agreements with funds to expand the range of situations in which this type of loan might be obtained (renewables, machinery, real estate, etc.)

Overall, Investment Banking continues to develop and expand its capacity to offer a broader range of value added solutions, helping the Bank to position itself as the leading financial institution for companies seeking funding in all situations.

Trading, Custody and Research

Trading, Custody and Research (TCR) is the unit responsible, as product manager, for the Group's equities, performing equity execution through the trading desk, both in domestic markets, where it acts as a member, and in international markets, acting as a broker.

It has a research department whose aim is to offer guidance and investment recommendations in equity and credit markets. Customers can access this service through a variety of means, including podcasts, webinars, videos, daily reports, sectoral reports, company factsheets, etc.

In 2024, a number of initiatives and projects were implemented focused on improving the level of service offered to customers, increasing the range of brokerage products, attracting new customers and facilitating transaction capacity. Commercial activity with private banking customers who frequently trade in securities has continued to boost the exclusive direct access service for these customers through the equity trading desk, for both execution services and recommendations.

2024 has continued on the same trend observed in the previous year, with a continuing decline in the volume traded on the Spanish stock market (BME). In any event, Banco Sabadell maintains a similar market share in that market, specifically, 8.3% in 2024 compared with 8.2% in 2023.

A very high percentage of equity transactions carried out through selfservice channels was observed, with 93% of orders channelled directly by customers using tools provided by Banco Sabadell, the mobile app being the preferred channel for these transactions.

The main objective for 2025 will be to increase brokerage volumes in the equity markets, both in Spain and internationally, and optimise the customer's online experience with the completion and launch of the new Sabadell Broker platform, including more analytical information and providing better and more sophisticated brokerage capabilities and services. In addition, the changes required under the Reform III project (Law 6/2023 of 17 March on Securities Markets and Investment Services) will be implemented.

In terms of income, 2024 was a positive year with fees and commissions increasing by around 10%. Furthermore, the forecasts for 2025 are optimistic and both volumes and fees & commissions are expected to grow.

4.2 Banking Business United Kingdom

Business overview

TSB (TSB Banking Group plc) offers a range of retail banking products and services to individuals and small and medium-sized enterprises in the UK. The entity has a multi-channel distribution model, which includes fully digital capabilities (internet and mobile) and telephony channels, in addition to a network of branches throughout Great Britain.

The multi-channel offer enables TSB to provide a better service to its customers. Customers want a bank that gives them access to both skilled people and simple digital tools to meet their banking needs, which allows them to manage their money with more confidence. TSB continues to invest in the development of digital products and services to meet customers' current and future needs. To that end, the entity combines the best of digital banking with a revitalised presence in commercial areas of the UK, in addition to a telephone helpline and a video-call facility. All this allows TSB to serve its customers with that all-important human touch when it matters most to customers, ensuring it lives up to its purpose of "Money Confidence. For everyone. Every day".

TSB offers current and savings accounts, personal loans, mortgages and debit/credit cards for retail customers, as well as a wide range of current and savings accounts and loans for SME customers.

Management team priorities in 2024

Throughout 2024, TSB has continued to support customers and successfully execute its 2025 Strategy, which is centred around service excellence, customer focus, simplification and efficiency and doing what matters for people and the planet.

Thanks to a clear focus on cost discipline, TSB's financial position remains strong. The entity has once again delivered an excellent set of results, with profitability improving each quarter, demonstrating the resilience that underpins its business model.

With the strong foundations put in place over recent years, TSB is well placed to realise its potential as it continues to meet the evolving needs and demands of its customers.

Executing the strategy

TSB is a simpler, more efficient and more resilient bank and has become more streamlined in the way it supports its customers, combining modern digital services to meet growing customer demand, and efficient personal support in branch or over the phone. The continued growth of video banking provides customers with even greater convenience and choice in how they engage with the bank.

In 2024, TSB:

• Opened more than 1.19 million new products for its customers across core product lines, including 244,000 personal current accounts in a highly competitive market.
• The entity has enabled customers to perform more daily transactions whenever and wherever they find it most convenient to do so; consequently, in 2024, 91% of new products taken by TSB customers were arranged remotely.
• Further strengthened its digital banking offer, including a range of improvements to make its website and app more accessible.
• Helped more than 7,600 first-time buyers get onto the property ladder, thanks to its award-winning mortgage intermediary and operations team.
• Has the seventh largest network of physical branches in the United Kingdom, with 186 branches in commercial areas, complemented by pop-up branches and TSB pods.

With inflation now at more contained levels, the Bank of England cut the official rate twice in the second half of 2024, lowering it to 4.75%. Market expectations remain unsettled, but it is anticipated that the official rate will remain higher than it was in the years before the recent hikes.

The unemployment rate remained at relatively low levels in 2024 while house prices increased. Nevertheless, the pace of economic activity in the United Kingdom slowed during the second half of the year.

The 'money confidence' that TSB offers its customers is particularly relevant in this economic context. Its solid capital and liquidity position indicates that the entity is well positioned to reach its ambitious growth targets going forward.

Key figures

The contribution to net profit amounted to 253 million euros as at the end of 2024, representing year-on-year growth of 29.9%.

Net interest income came to a total of 1,163 million euros, 0.9% lower than in the previous year, due to the higher cost of deposits and wholesale funding and reduced average volumes, which offset the increase attributable to the higher credit yield. However, net interest income in the last quarter of 2024 reversed this trend, rising by 3.5%.

Net fees and commissions amounted to 107 million euros as at 2024year-end, representing a year-on-year reduction of 13.6%, due to a reduction in card fees, which incorporate an increase in costs.

Total costs amounted to 887 million euros, falling by 5.8% year-onyear due both to the reduction in staff and general expenses and a decrease in amortisation/depreciation. Total costs include -21 million euros of non-recurrent restructuring costs in 2024 and -33 million euros in 2023, and as such the reduction in recurrent costs is -4.7%.

Provisions and impairments amounted to 37 million euros, representing a year-on-year improvement due to fewer credit provisions, mainly explained by the revised macroeconomic scenario.

Million euro

	2024	2023	Year-on-year change (%)
Net interest income	1,163	1,174	(0.9)
Fees and commissions, net	107	124	(13.6)
Core revenue	1,270	1,298	(2.1)
Profit or loss on financial operations and exchange differences	39	16	141.0
Equity-accounted income and dividends	—	—	—
Other operating income and expenses	(23)	(23)	(0.4)
Gross income	1,286	1,291	(0.4)
Operating expenses, depreciation and amortisation	(887)	(941)	(5.8)
Pre-provisions income	399	350	14.1
Provisions and impairments	(37)	(75)	(50.2)
Capital gains on asset sales and other revenue	(8)	—	—
Profit/(loss) before tax	353	274	28.8
Corporation tax	(100)	(80)	26.0
Profit or loss attributed to minority interests	—	—	—
Profit attributable to the Group	253	195	29.9
ROTE (net return on tangible equity)	12.0 %	10.0 %
Cost-to-income (general administrative expenses / gross income)	59.5 %	62.1 %
NPL ratio	1.5 %	1.5 %
Stage 3 coverage ratio, with total provisions	34.3 %	41.8 %

(*) The exchange rates applied to the income statement are EUR/GBP 0.8463 (average) and EUR/GBP 0.8706 (average) in 2024 and 2023, respectively.

Gross performing loans increased by 4.8% year-on-year, benefiting from the appreciation of the pound sterling as, considering a constant exchange rate, they remained broadly stable.

On-balance sheet customer funds increased by 5.7% year-on-year, driven by demand deposits and term deposits. At constant exchange rates, the growth was 0.8%.

Million euro

			Year-on-year
	2024	2023	change (%)
Assets	55,604	54,855	1.4
Gross performing loans to customers	43,380	41,381	4.8
Liabilities and Equity	55,604	54,855	1.4
On-balance sheet customer funds	42,123	39,864	5.7
Wholesale funding in capital markets	5,859	4,545	28.9
Allocated own funds	2,543	2,368	7.4
Off-balance sheet customer funds	—	—	—
Other indicators
Employees	4,729	5,426	(12.8)
Branches and offices	186	211	(11.8)

The EUR/GBP exchange rate used for the balance sheet is 0.8292 as at 31 December 2024 and 0.8691 as at 31 December 2023.

4.3 Banking Business Mexico

Business overview

The business was established in Mexico through an organic project with the creation of two financial vehicles: first, a SOFOM (multi-purpose financial company), which commenced operations in 2014, and subsequently, a bank. The banking licence was obtained in 2015 and the Bank began operating in Mexico at the beginning of 2016.

Both vehicles operate under a customer-centric model, with agile processes, digital channels and no branches. The rollout of business capabilities considers the vehicles mentioned above, present in 10 Mexican banks, and the following business lines:

• Corporate Banking, aimed at corporates and large enterprises, with specialisation in different sectors.
• Business Banking, which mimics the Group's original business banking relationship model and has been consolidated year after year since its launch in 2016.
• Retail Banking, which features entirely digital customer acquisition, launched in the second half of 2024, which pays interest with no minimum balance, has zero fees and commissions and offers 24/7 availability of funds. To position the product successfully, there has been significant investment in marketing over the year.

Management priorities in 2024

The Mexican subsidiaries (Banco Sabadell S.A., I.B.M. and Sabcapital S.A. de C.V., SOFOM, E.R.) performed well, despite an increase in administrative and marketing expenses associated with the rollout of a new source of retail deposit-taking.

During 2024, the Mexican subsidiaries continued to focus on growth, financial self-sufficiency and profitability. It is worth noting the following initiatives implemented during the year:

• In Corporate Banking, activity in Banco Sabadell's Fiduciary division stabilised as did activity involving derivative financial instruments and the rollout of currency forward transactions, leading to a more comprehensive service for structured finance transactions and strengthening the link with customers.
• In Business Banking, the improvement in transactional capabilities has been consolidated, offering an excellent service, a quality that has set it apart since the segment was first launched.
• During 2024, work was carried out on the launch of Retail Banking to attract new customers, offering attractive interest rates and the ability to access funds at any time, deploying the corresponding human and marketing resources to that end.

In 2024, a financial planning exercise in line with that of the Group was carried out to determine the main strategic courses of action for Banco Sabadell in Mexico, which will allow more value to be generated for the Group's Mexican franchise. These are summarised below:

• The rollout and promotion of Retail Banking, in order to contribute to an improved cost of funding, by marketing attractive rates for customers.
• Increasing the generation of income without capital consumption by generating more income from fees and commissions and by promoting new products, such as derivatives, currency trading and fiduciary services, among others, as well as treasury strategies to obtain a better return on investments and repo transactions.

On 1 July 2024, HR Ratings ratified the credit ratings of Banco Sabadell Mexico and Sabcapital of HR AAA long term and HR +1 short term with a stable outlook, based on the operational and financial support that it receives from the parent company in Spain, its sound solvency position, improvement in net interest margin and highly-rated Environmental, Social and Governance policies.

On 19 December 2024, S&P issued its long- and short-term credit ratings using the Mexican domestic rating scale, with the entity's longterm rating remaining at MxAA with a stable outlook and the short-term rating placed at mxA-1+, based on a positive trend in operating income thanks to the consolidation of its market position in business lending to companies in the Mexican banking system.

Looking ahead to 2025, authorisation has been obtained from the regulator to proceed with the merger of Banco Sabadell, Institución de Banca Múltiple and Sabcapital, S.A. de C.V., SOFOM, E.R., effective as from 1 January 2025. The purpose of the merger is primarily to make operational, administrative and regulatory processes more efficient by having a single vehicle, and to give the resulting entity's results and indicators market visibility.

In addition, an issue of subordinated bonds for 50 million dollars is planned in the first quarter, with the aim of mitigating possible exchange rate volatility through this private placement, which will be purchased by Banco Sabadell with the intention of treating these debt instruments as part of 'non-core basic capital'. Authorisation by the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores de México) must be obtained for this issue.

Key figures

The contribution to net profit as at 2024 year-end amounted to 57 million euros, representing year-on-year growth of 28.8%, mainly supported by core revenue growth.

Net interest income came to 206 million euros, growing by 5.0% year-on-year, mainly due to larger average volumes and a higher credit yield.

Net fees and commissions amounted to 18 million euros as at 2024 year-end, increasing by 3 million euros compared to the previous year due to increased commercial activity.

Total costs stood at 126 million euros, representing a year-on-year increase, mainly driven by higher general expenses, particularly marketing costs.

Provisions and impairments amounted to -24 million euros as at the end of 2024, representing a year-on-year increase due to the impairment of single-name borrowers.

Capital gains on asset sales and other revenue fell during the year due to fewer write-downs of IT assets.

	2024	2023	Year-on-year change (%)
Net interest income	206	196	5.0
Fees and commissions, net	18	15	24.8
Core revenue	224	211	6.4
Profit or loss on financial operations and exchange differences	13	8	67.3
Equity-accounted income and dividends	—	—	—
Other operating income and expenses	(21)	(20)	7.6
Gross income	216	198	8.6
Operating expenses, depreciation and amortisation	(126)	(108)	15.8
Pre-provisions income	90	90	(0.1)
Provisions and impairments	(24)	(19)	27.1
Capital gains on asset sales and other revenue	(4)	(19)	(80.7)
Profit/(loss) before tax	62	53	18.5
Corporation tax	(6)	(9)	(32.8)
Profit or loss attributed to minority interests	—	—	—
Profit attributable to the Group	57	44	28.8
ROTE (net return on tangible equity)	9.7 %	8.9 %
Cost-to-income (general administrative expenses / gross income)	51.2 %	45.7 %
NPL ratio	2.8 %	2.4 %
Stage 3 coverage ratio, with total provisions	59.5 %	74.3 %

(*) The exchange rates applied to the income statement are EUR/MXN 19.7732 (average) and EUR/MXN 19.1120 (average) in 2024 and 2023, respectively.

Million euro

Performing loans fell by 7.5% year-on-year, impacted by the depreciation of the Mexican peso, the reduction at constant rates standing at 4.6%.

On-balance sheet customer funds fell by 0.2% year-on-year, while at constant exchange rates they increased by 10.5%, due to an increase in both demand deposits and term deposits.

Million euro

	2024	2023	Year-on-year change (%)
Assets	6,646	6,670	(0.4)
Gross performing loans to customers	4,242	4,587	(7.5)
Real estate exposure, net		—	—
Liabilities and Equity	6,646	6,670	(0.4)
On-balance sheet customer funds	3,199	3,205	(0.2)
Allocated own funds	686	631	8.7
Off-balance sheet customer funds	—	—	—
Other indicators
Employees	515	435	18.4
Branches and offices	12	15	(20.0)

(*) The EUR/MXN exchange rate used for the balance sheet was 21.5504 as at 31 December 2024 and 18.7231 as at 31 December 2023.

Strategic risk management and control processes Main milestones achieved in 2024 in relation to risk management and control

Risks

During 2024, Banco Sabadell Group has continued to strengthen its global risk framework by making improvements to bring it in line with best practice in the financial sector.

During 2024, Banco Sabadell Group has continued to strengthen its Global Risk Framework by making improvements to bring it in line with best practice in the financial sector.

The Group continues to have a medium-low risk profile, in accordance with the risk appetite defined by the Board of Directors.

The Group's risk strategy is fully implemented and linked to the Strategic Plan and the Group's risk-taking capacity, articulated through the Risk Appetite Statement (RAS), under which all material risks are monitored, tracked and reported, and the necessary control and remediation systems are in place to ensure compliance therewith:

5.1 Strategic risk management and control processes

5.2 Main milestones achieved in 2024 in relation to risk management and control

The most salient aspects concerning the management of the first-tier risks identified in Banco Sabadell Group's risk taxonomy and concerning the actions taken in this regard in 2024 are set out below:

Strategic risk

Definition: the risk of losses (or negative impacts in general) materialising as a result of making strategic decisions or of their subsequent implementation. It also includes the inability to adapt the Group's business model to changes in the environment in which it operates.

Key milestones in 2024:

(1) Strategy and reputation

• Although there were macroeconomic factors at play in 2024 that threatened to have a negative impact on the Bank's profitability, those threats did not materialise as (i) inflation has stabilised, (ii) global growth was better than expected, (iii) the interest rate cutting cycle began, and (iv) there were signs of improvement in both demand for credit and economic activity, with a better outlook for Spain. Similarly, the successful implementation of levers by the Institution, the stronger credit profile and the delivery of recordbreaking results are all reflected in several reputational indicators, for example, (i) the improved outlooks of investors and rating agencies with regard to the Institution and (ii) solid performance of the Institution's shares, which appreciated by 68.64% over the year.
• The Group is exposed to reputational risk inherent in the sector in which it operates, characterised by significant visibility among customers and the general public.
• In recent years, a series of events has led to a change in the relationship model of financial institutions with their customers and investors, with a shift towards reduced face-to-face service in retail banking which has accentuated the materiality of this risk.
• Banco Sabadell Group bases its business model on corporate values such as ethics, professionalism, rigour, transparency, quality and, in general, long-term business relationships that are beneficial to both the Group and its counterparties.

(2) Capital position

• The CET1 ratio stood at 13.02% as at 2024 year-end, particularly driven by organic capital generation. Regulatory requirements in relation to capital are generally being met.
• The Total Capital ratio has improved, ending 2024 at 17.60%.
• As at the end of 2024, the leverage ratio stood at 5.20%, representing an increase of 12 basis points compared to 2023.

(3) Profitability

• In 2024, global growth was better than expected, inflation stabilised and the central banks began to cut interest rates. Demand for credit and economic activity also showed signs of improvement.
• With regard to the tender offer launched by Banco Bilbao Vizcaya Argentaria (BBVA) in May 2024 for the acquisition of 100% of Banco Sabadell's share capital, to date, there has been no indication that the risks posed by this situation will materialise.
• The geopolitical environment appears somewhat unstable due to the conflicts in Ukraine and in the Middle East, and because of the result of the presidential election in the United States, which could exacerbate trade and/or financial tensions at a global level.
• In 2024, the Institution successfully delivered on a number of strategic initiatives introducing, among other things, a series of improvements that have helped to reduce its cost of risk, such as the improvements made to its risk acceptance models for both companies and individuals.
• Against this backdrop, in year-on-year terms, Banco Sabadell has significantly increased its net earnings, driven by (i) sound core results, (ii) increased net interest income, (iii) reduced cost of risk, (iv) an active and growing commercial dynamic, and (v) contained growth of costs.
• All these aspects are clearly reflected in the Group's improved profitability, shown by an improvement of its ROTE, which increased from 11.50% as at 31 December 2023 to 14.93% as at 31 December 2024.

Credit risk

Definition: risk of incurring losses as a result of borrowers failing to fulfil their payment obligations, or of losses in value materialising due simply to the deterioration of borrowers' credit quality.

Key milestones in 2024:

(1) Non-performing assets

— During 2024, non-performing assets were reduced by 1,068 million euros. The NPL ratio for the year stands at 2.84%.

(2) Concentration

• From a sectoral point of view, the loan portfolio is diversified and has limited exposure to the sectors most sensitive to the current economic environment.
• Similarly, in terms of individual concentration, the risk metrics relating to concentration of large exposures showed a slight downward trend and remained within the appetite level. The credit rating of large exposures also improved over the year.
• Geographically speaking, the portfolio is positioned in the most dynamic regions, both in Spain and worldwide. International exposures account for 37% of the loan book.

(3) Lending performance

— Gross performing loans ended the year 2024 with a balance of 156,913 million euros, increasing by 4.7% year-on-year.

— In Spain, gross performing loans in year-on-year terms posted a 5.3% improvement, driven by the increase in lending to corporates and individuals, as well as the healthy performance of foreign branches.

(4) TSB lending performance

— In TSB, at a constant exchange rate, gross performing loans remained stable.

Financial risk

Definition: possibility of obtaining inadequate returns or having insufficient levels of liquidity that prevent an institution from meeting future requirements and expectations.

Key milestones in 2024:

(1) Sound liquidity position

• Sound liquidity position in which the Liquidity Coverage Ratio (LCR) stands at 210% at the Group level (200% at TSB LMU and 248% at Banco Sabadell Spain) and the Net Stable Funding Ratio (NSFR) stands at 142% at the Group level (153% at TSB LMU and 137% at Banco Sabadell Spain), both as at 2024 year-end, having repaid the remaining 5 billion euros of the amount drawn down from the ECB's TLTRO III facility, and having optimised long-term funding of up to 1.67 billion euros secured with the Bank of England.
• The Loan-to-Deposit ratio (LtD) as at the end of 2024 was 93.2%, with a balanced retail funding structure.
• Moreover, Banco Sabadell has fulfilled the capital markets issuance plan that it had set itself for 2024, with strong investor appetite, allowing it to optimise the associated funding costs.

(2) Structural interest rate risk

— In 2024, the Institution's loan book continued to trend towards a higher proportion of fixed-rate transactions, mainly mortgages and business loans, while on the liabilities side, balances of interestbearing demand deposits (mainly of wholesale customers) and term deposits have increased, contrasting with a reduction in the balance of non-interest-bearing demand deposits, whilst costs have been kept at low levels relative to interest rate trends over the year. In addition, other balance sheet variations in 2024 included the increase in the fixed-income portfolio on the asset side, which acts as a natural balance sheet management and coverage lever, and the implementation of management actions to defend net interest income amidst interest rate cuts.

Operational risk

Definition: risk of incurring losses due to inadequate or failed internal processes, people and systems or due to external events. This definition includes but is not limited to compliance risk, model risk and Information and Communications Technology (ICT) risk and excludes strategic risk and reputational risk.

Key milestones in 2024:

• Operational risk remains a significant risk for the Group, with impacts that can be absorbed in the normal course of the business.
• The current situation of high awareness and increased regulatory pressure, aimed especially at providing greater protection for consumers and vulnerable customers, requires conduct risks to be the main focus of attention. Its current materiality and the expectation that this situation will likely continue requires the focus to remain fixed on these risks, tracking their evolution and adequately monitoring the planned mitigation measures.
• The focus remains on complaints related to floor clauses, mortgage application and arrangement fees, interest rates connected with revolving credit cards and appropriate assistance for vulnerable customers, especially in the UK, given the demanding regulatory environment.
• The creation of the new financial customer protection authority, which is not yet in operation, could have an impact on the complaints received, as it facilitates this process. The materialisation of conduct risks involves a potential reputational risk for the Institution, although it remains in line with the sector.

Compliance risk

Definition: risk of incurring legal or regulatory sanctions, material financial loss or loss to reputation as a result of failing to comply with laws, regulations, internal rules and codes of conduct applicable to the Group's activities.

In accordance with Banco Sabadell's Compliance Policy and observing the EBA's Guidelines on Internal Governance, a Compliance Programme is drawn up, applying the principle of proportionality according to the nature, volume and complexity of activities, containing a detailed schedule of activities, including the review of policies and procedures, risk assessment, control plans and staff training in relation to compliance. This programme covers all services provided and activities carried out by Compliance and defines its priorities based on the risk assessment, in coordination with the Risk Control function. Monitoring exercises are conducted and regular reports on them are made to the Group's governing bodies in order to identify any deviations and resolve them quickly and effectively.

In 2024, efforts continued to be made to promote a culture of ethics and compliance among employees, interacting on an ongoing basis with the main supervisory authorities in connection with the Bank's compliance activity.

Priorities in 2025:

• Ensure the continuing development of the supervision model for subsidiaries and foreign branches in order to reinforce a homogeneous and grouped view of the entities under the scope of supervision.
• Continue to promote the plan to digitalise processes in the area of Anti-Money Laundering and Countering the Financing of Terrorism.
• Develop monitoring metrics to prevent compliance risks at the level of the governing bodies.
• Integrate research and the use of artificial intelligence models in the management and prevention of customer data protection risks.

• R&D and innovation
• Acquisition and sale of treasury shares
• Days payable outstanding
• Material post-closing events
• Other reports related to the consolidated Directors' Report

Other material disclosures 6.1 R&D and innovation

In the technological field, the focus remains on providing each geography with the functionalities that best suit their market context, supported by enhanced technological capabilities aligned with the latest market standards.

In Spain, the acceleration and digitalisation of processes and products is particularly noteworthy, especially in Retail Banking, and in the development of a new mobile app. It is also worth mentioning the improved resilience of the IT platform, with the launch of a new data centre for disaster recovery. TSB has continued to prioritise efforts to improve business capabilities, while the foundations have been laid to accommodate the technological platform's new architecture. Sabadell Mexico has focused on technological enhancement for Retail Banking activity and has continued to develop capabilities that improve transaction efficiency.

In the domestic context

In 2024, the rollout of the catalogue of digital products and processes in different customer segments has been key, as has the introduction of new capabilities for managers in the branch network, in order to continue enhancing their efficiency. At the same time, work has continued to strengthen and increase the resilience of the technological platform.

Within Retail Banking, the expansion of the catalogue of digital products was a priority, specifically improving capabilities in mortgage and loan granting processes. In turn, other digital self-service processes have been reinforced with the aim of reducing customer dependency on non-digital channels. In Business Banking, the global move towards digitalisation, particularly in the self-employed segment, stands out, with specific new processes enabled, as in the case of digital onboarding.

Advances in the development of a new mobile app have been remarkable and the card transaction geolocation service, as well as a range of improvements in transaction monitoring, have already been rolled out. The deployment of the new architecture is planned to take place at the beginning of 2025.

In the branch network, the deployment of new capabilities for network managers stands out, which has led to the digitalisation of different processes and is aimed at improving customer service and commercial productivity.

With regard to the development of the technological platform, the focus has been on bolstering and underpinning resilience in the rollout of the new disaster recovery data centre, combined with continuous improvement of cyberdefence capabilities and protection against fraud and scams. The development of the journey to cloud, focused on multicloud training and the dynamic provision of environments, or the artificial intelligence management programme that has deployed technological capabilities to enable the industrialisation of the process to provide new semantic models, are also noteworthy.

In 2024, these investments in technology (booked in the accounts as "Other intangible assets") at the national level (including technology investments in the foreign branches) amounted to 264,359 thousand euros, which was invested in different companies, including 216,752 thousand euros in Sabadell Digital, S.A.U.

In the international context

At TSB, a large part of activities have focused on improving the digital catalogue and the customer journey, as well as offering new multichannel capabilities that make it possible to tailor the customer experience. Initiatives were also implemented designed to improve the quality and resilience of the IT platform.

Sabadell Mexico has focused on developing programmes to improve digitalisation in Retail Banking, including the new Unconditional Account, as well as improving internal productivity tools.

Technology investments on an international scale during 2024 (booked in the accounts under "Other intangible assets") amounted to 54,464 thousand euros at TSB bank plc, and 27,370 thousand euros invested by the company Institución Banca Múltiple (IBM).

6.2 Acquisition and sale of treasury shares

See Note 23 to the consolidated annual financial statements.

6.3 Days payable outstanding

The average time taken to pay suppliers (days payable outstanding) by consolidated entities located in Spain was 24.51 days (22.36 days in the case of the Bank).

6.4 Material post-closing events

The most important developments to have occurred after 31 December 2024 are the change of location of the registered office from Alicante to Sabadell, described at the beginning of this consolidated Directors' Report, and the capital reduction described in section 3.1.

6.5 Other reports related to the consolidated Directors' Report

The consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, S.A. and subsidiaries (Sustainability Report).

In accordance with the provisions of Directive (EU) 2022/2464 of the European Parliament and of the Council, of 14 December 2022, as regards corporate sustainability reporting (CSRD), Banco Sabadell Group has prepared the Group's consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, S.A. and subsidiaries (Sustainability Report) for the year 2024, which, as established in Article 44 of Spain's Commercial Code, forms part of this consolidated Directors' Report and is included as a separate accompanying document.

Annual Corporate Governance Report

The Annual Corporate Governance Report (ACGR) corresponding to the 2024 financial year forms an integral part of the consolidated Directors' Report in accordance with the provisions of the Spanish Capital Companies Act. This report is signed off by the Board of Directors on the same date as the consolidated annual financial statements and the consolidated Directors' Report and is sent separately to the CNMV. From the date of publication of the consolidated annual financial statements and the consolidated Directors' Report, the ACGR is available on the CNMV's website (www.cnmv.es) and on the corporate website of Banco Sabadell Group (www.grupbancsabadell.com).

Annual Report on Director Remuneration

The Annual Report on Director Remuneration (ARDR) corresponding to the 2024 financial year forms an integral part of the consolidated Directors' Report in accordance with the provisions of the Spanish Capital Companies Act. This report is signed off by the Board of Directors on the same date as the consolidated annual financial statements and the consolidated Directors' Report and is sent separately to the CNMV. From the date of publication of the consolidated annual financial statements and the consolidated Directors' Report, the ARDR is available on the CNMV's website (www.cnmv.es) and on the corporate website of Banco Sabadell Group (www.grupbancsabadell.com).

www.grupbancsabadell.com

Glossary of terms on alternative performance measures

In the presentation of its results to the market, and for the purpose of monitoring the business and decision-making processes, the Group uses performance indicators pursuant to the generally accepted accounting regulations (EU-IFRS), and also uses other unaudited measures commonly used in the banking industry (Alternative Performance Measures, or APMs) as indicators to monitor the management of the Group's assets and liabilities, as well as its financial and economic situation, which facilitates its comparison with other institutions.

Following the ESMA guidelines on APMs (ESMA/2015/1415 of October 2015), the purpose of which is to promote the use and transparency of information for the protection of investors in the European Union, the Group presents in this section the definition, calculation and reconciliation for each APM.

Performance measure	Definition and calculation	Use or purpose
Gross performing loans to customers	Includes gross customer loans and advances, excluding reverse repos, assets classified as stage 3 and other valuation adjustments (interest, fees and commissions, and other).	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
Gross loans to customers	Includes loans and advances to customers excluding impairment allowances.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
On-balance sheet customer funds	Includes financial liabilities at amortised cost, excluding non-retail liabilities, such as deposits from central banks, deposits from credit institutions, institutional issues and other financial liabilities.	Key figure in the Group's condensed consolidated balance sheet, the performance of which is monitored.
On-balance sheet funds	Includes customer deposits and debt securities issued.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
Off-balance sheet customer funds	Includes off-balance sheet funds under management and third-party funds, such as mutual funds, assets under management, pension funds and insurance.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
Funds under management and third-party funds	The sum of on-balance sheet funds and off-balance sheet customer funds.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.

Customer spread	Difference between yield and costs of customer-related assets and liabilities, i.e. the contribution of exclusively customer-related transactions to net interest income. Calculated as the difference between the average rate that the Bank charges its customers for loans and the average rate that the Bank pays its customers for deposits. The average rate on customer loans and advances is the annualised ratio, in percentage terms, between financial revenues booked on customer loans and advances and the average daily balance of customer loans and advances. The average rate on customer funds is the annualised ratio, in percentage terms, between the financial cost booked on customer funds and the average daily balance of customer funds. The average balance is the arithmetic mean, calculated as the sum of the daily balances for the reference period and divided by the number of days in said period.	Reflects the profitability of solely banking activity.
Other assets	Comprises the following headings from the asset side of the balance sheet: (i) derivatives - hedge accounting, (ii) fair value changes of the hedged items in portfolio hedge of interest rate risk, (iii) assets under insurance or reinsurance contracts, (iv) tax assets, (v) other assets, and (vi) non-current assets and disposal groups classified as held for sale.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
Other liabilities	Comprises the following headings from the liability side of the balance sheet: (i) derivatives - hedge accounting, (ii) fair value changes of the hedged items in portfolio hedge of interest rate risk, (iii) tax liabilities, (iv) other liabilities, and (v) liabilities included in disposal groups classified as held for sale.	Key figure among the main indicators of a financial institution's business, the performance of which is monitored.
Other operating income and expenses	Comprises the following headings from the income statement: (i) other operating income, and (ii) other operating expenses.	Grouping of items used to explain part of the performance of the Group's consolidated results.
Pre-provisions income	Comprises gross margin and the following headings from the income statement: administrative expenses, and depreciation and amortisation.	One of the key figures that reflects the performance of the Group's consolidated results.
Total provisions and impairments	Comprises the following headings from the income statement: (i) provision or reversal of provisions, (ii) impairment or reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or gains, (iii) impairment or reversal of impairment on investments in joint ventures or associates, (iv) impairment or reversal of impairment on non-financial assets, (v) profit or (-) loss from non current assets and disposal groups classified as held for sale not qualifying as discontinued operations (excluding gains or (-) losses on the sale of interests and other items), and (vi) gains or (-) losses on derecognition of non-financial assets and interests, net (including only gains or losses on the sale of investment properties).	Grouping of items used to explain part of the performance of the Group's consolidated results.
Capital gains on asset sales and other revenue	Comprises the following headings from the income statement: (i) gains or (-) losses on derecognition of non-financial assets, net (excluding gains or losses on the sale of investment properties), and (ii) profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations (including only gains or (-) losses on the sale of interests and other items).	Grouping of items used to explain part of the performance of the Group's consolidated results.

ROA	Defined as a ratio that includes, in the numerator, consolidated profit or loss (past 12 months) and, in the denominator, average total assets. Average total assets: arithmetic mean calculated as the sum of the daily balances over the past twelve months and divided by the number of days in the past twelve months.	Measure commonly used in the financial sector to determine the accounting return on Group assets.
RORWA	Defined as a ratio that includes, in the numerator, consolidated profit or loss (past 12 months) and, in the denominator, average risk-weighted assets. Average risk-weighted assets: the average, over the past twelve months, of a credit institution's total assets, multiplied by its respective risk factors (risk weights). Risk factors reflect the perceived level of risk of a particular asset class.	Measure commonly used in the financial sector to determine the accounting return on risk-weighted assets.
ROE	Defined as a ratio that includes, in the numerator, profit attributable to the Group over the past twelve months and, in the denominator, average shareholders' equity. Average shareholders' equity: average shareholders' equity calculated using the closing balance of the past twelve months.	Measure commonly used in the financial sector to determine the accounting return on the Group's shareholders' equity.
ROTE	Defined as the ratio of profit attributable to the Group over the past twelve months to average shareholders' equity over the past twelve months. The denominator excludes intangible assets and goodwill of investees. Average shareholders' equity: average shareholders' equity over the past twelve months.	Additional measure of the accounting return on shareholders' equity, but excluding goodwill and intangible assets from its calculation.
Cost-to-income ratio	Defined as the ratio of administrative expenses to adjusted gross margin. The denominator includes the accrual on a straight-line basis of contributions to the Deposit Guarantee Fund (DGF) and the Single Resolution Fund (SRF), the Spanish tax on deposits of credit institutions (IDEC), and the bank levy (BL), except at year-end. The straight-line accrual of the DGF, SRF, IDEC and BL is based on the Group's best estimates.	One of the main indicators of efficiency or productivity of banking activity.
Cost-to-income ratio with amortisation/ depreciation	Defined as the ratio of administrative expenses and depreciation/amortisation to adjusted gross margin. The denominator includes the accrual on a straight-line basis of contributions to the Deposit Guarantee Fund (DGF) and the Single Resolution Fund (SRF), the Spanish tax on deposits of credit institutions (IDEC), and the bank levy (BL), except at year-end. The linear accrual of the DGF, SRF, IDEC and BL is based on the Group's best estimates.	One of the main indicators of efficiency or productivity of banking activity.
Stage 3 exposures	These include (i) assets classified as stage 3 including other valuation adjustments (accrued interests, fees and commissions, and other) classified as stage 3 of loans and advances not classified as non-current assets held for sale, and (ii) financial guarantees and other guarantees given classified as stage 3.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk undertaken with customers and to assess its management.
Stage 3 coverage ratio, with total provisions	Percentage of stage 3 exposures that is covered by total provisions. Calculated as impairment allowances of loans and advances to customers (including provisions for off-balance sheet exposures) / exposures classified as stage 3.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk undertaken with customers and shows the provisions that the Institution has allocated for loans classified as stage 3.

Stage 3 coverage ratio	Percentage of exposures classified as stage 3 that are covered by stage 3 provisions. Calculated as impairment allowances of stage 3 loans and advances to customers (including provisions for stage 3 off-balance sheet exposures) / exposures classified as stage 3.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk undertaken with customers and shows the provisions that the Institution has allocated for loans classified as stage 3.
Non-performing assets	The sum of risks classified as stage 3 plus non performing real estate assets. Non-performing real estate assets: foreclosed properties or properties accepted in payment of debt and properties classified in the portfolio of non-current assets and disposal groups classified as held for sale, except for investment properties with significant unrealised capital gains and those under lease for which there is a final agreement for a sale to take place following refurbishment.	Indicator of total exposure to risks classified as stage 3 and to non performing real estate assets.
Non-performing real estate coverage ratio	Obtained by dividing provisions for non-performing real estate assets by non-performing real estate assets. Non-performing real estate assets: foreclosed properties or properties accepted in payment of debt and properties classified in the portfolio of non-current assets and disposal groups classified as held for sale, except for investment properties with significant unrealised capital gains and those under lease for which there is a final agreement for a sale to take place following refurbishment.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of real estate risk and shows the provisions that the Institution has allocated for real estate exposure.
NPA coverage ratio	This ratio considers impairment allowances for customer loans and advances (including allowances for the impairment of off-balance sheet exposures) plus provisions associated with non-performing real estate in the numerator, while the denominator considers total non-performing assets.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk and real estate risk, and it shows the provisions that the Institution has allocated for non-performing exposures.
NPL ratio	Calculated in the form of a ratio whose numerator includes exposures classified as stage 3 and whose denominator includes (i) gross loans to customers, excluding reverse repos or (loans and advances to customers, excluding reverse repos and without impairment allowances), and (ii) financial guarantees and other guarantees given.	One of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk undertaken with customers and to assess its management.
Credit cost of risk (bps)	Calculated as credit loss provisions / gross loans to customers, excluding reverse repos and including financial guarantees and other guarantees given. The numerator considers the straight-line annualisation of loan loss provisions, which are adjusted for costs associated with the management of stage 3 assets (NPLs).	Relative measure of risk, being one of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk through the cost or loss due to financial asset impairment that has taken place in one year.
Total cost of risk (bps)	This ratio's numerator includes total provisions and impairments, while its denominator includes gross loans to customers, excluding reverse repos and including financial guarantees and other guarantees given and non-performing real estate assets. The numerator considers the straight-line annualisation of total provisions and impairments.	Relative measure of risk, being one of the main indicators used in the banking industry to monitor the status and performance of the quality of credit risk through the cost or loss due to financial asset impairment that has taken place in one year.

Loan-to-deposit ratio	This ratio's numerator includes gross loans to customers excluding brokered loans, reverse repos and impairment allowances, while its denominator includes on-balance sheet customer funds.	Measures a Bank's liquidity as the ratio of the funds at its disposal relative to the volume of lending items granted to customers. Liquidity is one of the key aspects that define the structure of an institution.
Market capitalisation	Calculated by multiplying the share price by the number of shares outstanding (number of total shares minus closing treasury stock position, including share buyback programmes, where applicable) as at the reporting date.	An economic market measurement or market ratio that indicates the total value of a company according to the market price.
Earnings (or loss) per share	This gives the ratio of net profit attributable to the Group, adjusted by the amount of the Additional Tier 1 coupon over the past twelve months, relative to the average number of shares outstanding over the past twelve months (average number of total shares minus average treasury stock, including buyback programmes, where applicable).	An economic measurement or market ratio that indicates a company's profitability, and it is one of the measurements used most frequently to assess institutions' performance.
Book value per share	Calculated as book value / number of shares outstanding (number of total shares minus closing treasury stock position, including share buyback programmes, where applicable) as at the reporting date. The book value is the sum of shareholders' equity, adjusted to account for contributions to the Deposit Guarantee Fund (DGF) and the Single Resolution Fund (SRF), the Spanish tax on deposits of credit institutions (IDEC) and the bank levy (BL), except at year-end. The DGF, SRF, IDEC and BL accrue based on the Group's best estimates.	An economic market measurement or market ratio that indicates the book value per share.
TBV per share	Calculated as tangible book value / number of shares outstanding (number of total shares minus closing treasury stock position, including share buyback programmes, where applicable) as at the reporting date. Tangible book value: sum of shareholders' equity adjusted to account for intangible assets and goodwill of investees, as well as the accrual to date of contributions to the Deposit Guarantee Fund (DGF) and the Single Resolution Fund (SRF), the Spanish tax on deposits of credit institutions (IDEC) and the bank levy (BL), except at year-end. The DGF, SRF, IDEC and BL accrue based on the Group's best estimates.	An economic market measurement or market ratio that indicates the tangible book value per share.
P/TBV (price/ tangible book value per share)	Share price or value / tangible book value per share.	Economic measurement or market ratio commonly used by the market, which represents the listed price of a share relative to its book value.
PER (share price / EPS)	Share price or value / net earnings per share.	Economic measurement or market ratio commonly used by the market to determine a company's ability to generate future earnings.

Equivalence of headings from the income statement of businesses and management units that appear in Note 38 on "Segment information" and in the consolidated Directors' Report with those of the consolidated income statement (*)

Net fees and commissions:

• Fee and commission income.
• (Fee and commission expenses).

Core revenue:

• Net interest income.
• Fee and commission income.
• (Fee and commission expenses).

Other operating income and expenses:

• Other operating income.
• (Other operating expenses).

Operating expenses, depreciation and amortisation:

• (Administrative expenses).
• (Depreciation and amortisation).
• Pre-provisions income:
• Gross margin.
• (Administrative expenses).
• (Depreciation and amortisation).

Provisions and impairments:

• (Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains).
• (Provisions or (-) reversal of provisions).
• (Impairment or (-) reversal of impairment on investments in joint ventures and associates).
• (Impairment or (-) reversal of impairment on non-financial assets).
• Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations (excluding gains or (-) losses on the sale of interests and other items).
• Gains or (-) losses on derecognition of non-financial assets and interests, net (including only gains or losses on sale of investment properties).

Provisions for loan losses:

• (Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss and net modification losses or (-) gains).
• (Provisions or (-) reversal of provisions) (including only commitments and guarantees given).

Provisions for other financial assets:

— (Provisions or (-) reversal of provisions) (excluding commitments and guarantees given).

Other provisions and impairments:

• (Impairment or (-) reversal of impairment on investments in joint ventures and associates).
• (Impairment or (-) reversal of impairment on non-financial assets).
• Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations (excluding gains or (-) losses on the sale of interests and other items).
• Gains or (-) losses on derecognition of non-financial assets and interests, net (including only gains or losses on sale of investment properties).

Capital gains on asset sales and other revenue:

• Gains or (-) losses on derecognition of non-financial assets and interests, net (excluding gains or losses on sale of investment properties).
• Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations (including only gains or (-) losses on the sale of interests and other items).

(*) Headings in the consolidated income statement expressed in brackets denote negative figures.

APMs reconciliation (data in million euros, with the exception of those shown in percentages).

BALANCE SHEET	31/12/2024	31/12/2023
Gross loans to customers / Gross performing loans to customers
Loans and credit secured with mortgages	89,185	86,162
Loans and credit secured with other collateral	5,924	5,064
Trade credit	8,356	7,465
Finance leases	2,376	2,236
Bank overdrafts and other short-term borrowings	51,071	48,870
Gross performing loans to customers	156,913	149,798
Stage 3 assets (customers)	4,595	5,472
Other valuation adjustments (interest, fees and commissions, and other)	208	172
Gross loans to customers, excluding reverse repos	161,717	155,442
Reverse repos	—	17
Gross loans to customers	161,717	155,459
Impairment allowances	(2,844)	(3,199)
Loans and advances to customers	158,872	152,260
On-balance sheet customer funds
Financial liabilities at amortised cost	220,228	216,072
Non-retail financial liabilities	50,671	55,184
Deposits from central banks	1,697	9,776
Deposits from credit institutions	14,822	13,840
Institutional issues	27,702	25,234
Other financial liabilities	6,450	6,333
On-balance sheet customer funds	169,557	160,888
On-balance sheet funds
Customer deposits	169,823	160,331
Demand deposits	138,347	134,243
Deposits with agreed maturity including deposits redeemable at notice and hybrid financial liabilities	31,047	25,588
Repurchase agreements	—	200
Other valuation adjustments (interest, fees and commissions, and other)	429	299
Debt securities issued	27,437	25,791
Borrowings and other marketable securities	23,345	22,198
Subordinated liabilities	4,092	3,593
On-balance sheet funds	197,260	186,122
Off-balance sheet customer funds
Mutual funds	28,308	24,093
Assets under management	4,729	3,598
Pension funds	3,352	3,249
Insurance products sold	9,782	9,621
Off-balance sheet customer funds	46,171	40,561
Funds under management and third-party funds
On-balance sheet funds	197,260	186,122
Off-balance sheet customer funds	46,171	40,561
Funds under management and third-party funds	243,431	226,682

BALANCE SHEET	31/12/2024	31/12/2023
Other assets
Derivatives – Hedge accounting	2,395	2,425
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(412)	(568)
Tax assets	6,441	6,838
Other assets	425	436
Non-current assets and disposal groups classified as held for sale	718	771
Other assets	9,567	9,902
Other liabilities
Derivatives – Hedge accounting	804	1,172
Fair value changes of the hedged items in portfolio hedge of interest rate risk	(227)	(422)
Tax liabilities	219	333
Other liabilities	652	723
Liabilities included in disposal groups classified as held for sale	30	13
Other liabilities	1,477	1,818
INCOME STATEMENT	31/12/2024	31/12/2023
Customer margin
Loans and advances to customers (net)
Profit/(loss)	6,726	5,840
Average balance	154,131	153,978
Annualised average rate (%)	4.36	3.79
Customer deposits
Profit/(loss)	(1,997)	(1,432)
Average balance	162,250	160,564
Annualised average rate (%)	(1.23)	(0.89)
Customer margin	3.13	2.90
Other operating income and expenses
Other operating income	112	91
Other operating expenses	(405)	(538)
Other operating income and expenses	(294)	(447)
INCOME STATEMENT	31/12/2024	31/12/2023
Pre-provisions income
Gross margin	6,337	5,862
Administrative expenses	(2,583)	(2,496)
Staff expenses	(1,531)	(1,495)
Other general administrative expenses	(1,051)	(1,002)
Depreciation and amortisation	(501)	(519)
Pre-provisions income	3,254	2,847
Total provisions and impairments
Impairment or reversal of impairment on investments in joint ventures and associates	—	—
Impairment or reversal of impairment on non-financial assets, adjusted	(42)	(22)
Impairment or reversal of impairment on non-financial assets	(45)	(26)
Gains or losses on sale of investment properties Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations, adjusted (excluding gains or (-) losses on the sale of	3 (36)	4 (58)
interests and other items).
Other provisions and impairments	(78)	(80)
Provisions or reversal of provisions Impairment or reversal of impairment and gains or losses on modifications of cash flows of financial assets not measured at fair value through profit or loss and net modification losses or	(44) (592)	(6) (824)
gains
Provisions for loan losses and other financial assets	(636)	(831)
Total provisions and impairments	(714)	(910)
Capital gains on asset sales and other revenue Gains or (-) losses on derecognition of non-financial assets and interests, net, adjusted	(26)	(44)
(excluding gains or losses on sale of investment properties and other items). Gains or losses on the sale of interests and other items	—	(2)

PROFITABILITY AND EFFICIENCY	31/12/2024	31/12/2023
ROA
Consolidated profit or loss (past 12 months)	1,829	1,334
Average total assets (past 12 months)	242,145	245,173
ROA (%)	0.76	0.54
RORWA
Consolidated profit or loss (past 12 months)	1,829	1,334
Average risk-weighted assets (RWAs) (past 12 months)	79,693	78,519
RORWA (%)	2.29	1.70
ROE
Net profit attributable to the Group (past 12 months)	1,827	1,332
Average shareholders' equity (past 12 months)	14,738	14,042
ROE (%)	12.40	9.49
ROTE
Net profit attributable to the Group (past 12 months)	1,827	1,332
Average shareholders' equity excluding intangible assets (past 12 months)	12,235	11,583
ROTE (%)	14.93	11.50
Cost-to-income ratio
Gross margin	6,337	5,862
Administrative expenses	(2,583)	(2,496)
Cost-to-income ratio (%)	40.75	42.59
Depreciation and amortisation	(501)	(519)
Cost-to-income ratio with amortisation/depreciation (%)	48.66	51.44

RISK MANAGEMENT	31/12/2024	31/12/2023
Stage 3 exposures
Assets classified as stage 3 (including other valuation adjustments)	4,637	5,510
Financial guarantees and other guarantees given classified as stage 3 for off-balance sheet exposures	207	268
Stage 3 exposures	4,844	5,777
Stage 3 coverage ratio, with total provisions
Impairment allowances	2,848	3,202
Provisions recognised on liabilities side of the balance sheet for off-balance sheet exposures	142	165
Stage 3 exposures	4,844	5,777
Stage 3 coverage ratio, with total provisions (%)	61.7 %	58.3 %
Stage 3 coverage ratio
Impairment allowances for stage 3 assets	2,168	2,359
Provisions recognised on liabilities side of the balance sheet classified as stage 3 for off-balance sheet exposures	77	86
Stage 3 exposures	4,844	5,777
Stage 3 coverage ratio (%)	46.3 %	42.3 %
Non-performing assets
Stage 3 exposures	4,844	5,777
Non-performing real estate assets	836	971
Non-performing assets	5,680	6,748
NPA coverage ratio (%)
Impairment allowances	2,848	3,202
Provisions recognised on liabilities side of the balance sheet for off-balance sheet exposures	142	165
Allowances for non-performing real estate assets	338	385
Non-performing assets	5,680	6,748
NPA coverage ratio (%)	58.6 %	55.6 %
Non-performing real estate coverage ratio
Allowances for non-performing real estate assets	338	385
Non-performing real estate assets	836	971
Non-performing real estate coverage ratio (%)	40.5 %	39.6 %
NPL ratio
Stage 3 exposures	4,844	5,777
Gross loans to customers, excluding reverse repos	161,717	155,442
Financial guarantees and other guarantees given for off-balance sheet exposures	8,699	8,896
NPL ratio (%)	2.8 %	3.5 %
Credit cost of risk (bps)
Provisions for loan losses	(567)	(813)
NPL expenses	(118)	(106)
Gross loans to customers, excluding reverse repos	161,717	155,442
Financial guarantees and other guarantees given for off-balance sheet exposures	8,699	8,896
Credit cost of risk (bps)	26	43
Total cost of risk (bps)
Total provisions and impairments	(714)	(910)
Gross loans to customers, excluding reverse repos	161,717	155,442
Financial guarantees and other guarantees given for off-balance sheet exposures	8,699	8,896
Non-performing real estate assets	836	971
Total cost of risk (bps)	42	55
LIQUIDITY MANAGEMENT	31/12/2024	31/12/2023
Loan-to-deposit ratio
Gross loans to customers, excluding reverse repos	161,717	155,442
(-) Impairment allowances	2,844	3,199
(-) Brokered loans	884	953
On-balance sheet customer funds	169,557	160,888
Loan-to-deposit ratio (%)	93.2 %	94.0 %

SHAREHOLDERS AND SHARES	31/12/2024	31/12/2023
Market capitalisation
Total number of shares issued less treasury stock (outstanding) (million)	5,361	5,403
Listed price	1.877	1.113
Market capitalisation (million euro)	10,063	6,014
Earnings per share (EPS)
Profit attributable to the Group, adjusted (past 12 months)	1,729	1,217
Profit attributable to the Group (past 12 months)	1,827	1,332
Adjustment for accrued AT1 (past 12 months)	(98)	(115)
Average number of shares outstanding (million)	5,376	5,401
Earnings per share (euro)	0.32	0.23
Book value per share
Shareholders' equity	15,389	14,344
Total number of shares issued less treasury stock (outstanding) (million)	5,361	5,403
Book value per share (euro)	2.87	2.65
TBV per share
Gross carrying value	12,840	11,861
Shareholders' equity	15,389	14,344
(-) Tangible assets	2,549	2,483
Total number of shares issued less treasury stock (outstanding) (million)	5,361	5,403
TBV per share (euro)	2.39	2.20
P/TBV
Listed price	1.877	1.113
TBV per share (euro)	2.39	2.20
P/TBV (price/tangible book value per share)	0.78	0.51
PER
Listed price	1.877	1.113
Earnings per share (euro)	0.32	0.23
PER (share price / EPS)	5.84	4.94

Consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell, Sociedad Anónima and subsidiaries (Sustainability Report) corresponding to the year 2024

TABLE OF CONTENTS

1. Introduction	373
1.1 BP-1: General basis for preparation of the sustainability report and BP-2: Disclosures in relation to specific circumstances	373
2. Governance	374
2.1 GOV-1: The role of the administrative, management and supervisory bodies	374
2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies	380
2.3 GOV-3: Integration of sustainability-related performance in incentive schemes	383
2.4 GOV-4: Statement on due diligence	385
2.5 GOV-5: Risk management and internal controls over sustainability reporting	386
3. Strategy	388
3.1 SBM-1: Strategy, business model and value chain	390
3.2 SBM-2: Interests and views of stakeholders	402
3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	404
4. Impacts, risks and opportunities management	410
4.1. Double materiality (IRO-1, IRO-2 and SBM-3)	410
5. Material disclosures	417
Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)	418
5.1 Environmental: Climate change	423
5.1.1 Introduction	423
5.1.2. Governance	423
5.1.2.1 ESRS GOV-3: Integration of sustainability-related performance in incentive schemes	423
5.1.3. Strategy	424
5.1.3.1 E1-1: Transition plan for climate change mitigation	424
5.1.3.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	426
5.1.4. Impacts, risks and opportunities management	428
5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities	428
5.1.4.2. E1-2: Policies related to climate change mitigation and adaptation	438
5.1.4.3. E1-3: Actions and resources in relation to climate change policies	441
5.1.5. Metrics and targets	448
5.1.5.1. E1-4: Targets related to climate change mitigation and adaptation	448
5.1.5.2. E1-5: Energy consumption and mix	453
5.1.5.3. E1-6: Gross Scopes 1, 2, 3 and Total GHG emissions	455

5.1.5.4. E1-7: GHG removals and GHG mitigation projects financed through carbon credits	459
5.1.5.5 E1-8: Internal carbon pricing scheme	460
5.2 Social: Own workforce	461
5.2.1 Introduction	462
5.2.2. Strategy	462
5.2.2.1. ESRS 2 SBM-2: Interests and views of stakeholders	462
5.2.2.2. ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	462
5.2.3. Impacts, risks and opportunities management	463
5.2.3.1. S1-1: Policies related to own workforce	463
5.2.3.2 S1-2: Processes for engaging with own workers and workers' representatives about impacts	466
5.2.3.3. S1-3: Processes to remediate negative impacts and channels for own workers to raise concerns	467
5.2.3.4. S1-4: Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions	472
5.2.4 Metrics and targets	478
5.2.4.1 S1-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	478
5.2.4.2 S1-6: Characteristics of the undertaking's employees	480
5.2.4.3. S1-8: Collective bargaining coverage and social dialogue	483
5.2.4.4 S1-10: Adequate wages	484
5.2.4.5. S1-13: Training and skills development	484
5.2.4.6 S1-14: Health and safety metrics	485
5.2.4.7 S1-15: Work-life balance metrics	487
5.2.4.8 S1-16: Compensation metrics (pay gap and total compensation)	487
5.2.4.9 S1-17: Incidents, complaints and severe human rights impacts	492
5.3 Social: Consumers and end-users	492
5.3.1 Introduction	492
5.3.2 Strategy	493
5.3.2.1 ESRS 2 SBM-2: Interests and views of stakeholders	493
5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	493
5.3.3 Impacts, risks and opportunities management	501
5.3.3.1 S4-1: Policies related to consumers and end-users	501
5.3.3.2 S4-2: Processes for engaging with consumers and end-users about impacts	504
5.3.3.3. S4-3: Processes to remediate negative impacts and channels for consumers and end-users to raise concerns	505

5.3.3.4 S4-4: Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions	508
5.3.4 Metrics and targets	513
5.3.4.1 S4-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	513
5.4 Governance: Business conduct	514
5.4.1 Introduction	515
5.4.2 Governance	515
5.4.2.1 ESRS 2 GOV-1: The role of the administrative, management and supervisory bodies	515
5.4.3 Impacts, risks and opportunities management	515
5.4.3.1 ESRS 2 IRO-1: Description of the processes to identify and assess material impacts, risks and opportunities	515
5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture	515
5.4.3.3. G1-2: Management of relationships with suppliers	522
5.4.3.4 G1-3: Prevention and detection of corruption and bribery	525
5.4.4 Metrics and targets	525
5.4.4.1 G1-4: Confirmed incidents of corruption or bribery	525
5.5. Entity-specific disclosures: Tax responsibility	526
6. Annexes	531
6.1 Initiatives and alliances	532
6.2 Principles for Responsible Banking: Responsible Banking Progress Statement	535
6.3 Taxonomy indicators	539
6.4 Equator Principles	625
6.5 List of disclosure requirements fulfilled	626
6.6 Table of datapoints associated with other European regulations	629

1. Introduction

1.1 BP-1: General basis for preparation of the sustainability report and BP-2: Disclosures in relation to specific circumstances

This document sets out the Consolidated Non-Financial Disclosures and Sustainability Disclosures Report of Banco de Sabadell S.A. and subsidiaries, hereinafter referred to as the Sustainability Report.

The scope of the Sustainability Report includes the entire Banco Sabadell Group, as it does in the financial statements. When the reported information does not cover the entire perimeter, this will be specifically indicated.

The regulatory framework under which this report is presented is Directive (EU) 2022/2464 of the European Parliament and of the Council of 14 December 2022 as regards corporate sustainability reporting (the Corporate Sustainability Reporting Directive, or CSRD). This directive, which amends Directive 2014/95/EU of 22 October 2014 as regards disclosure of non-financial and diversity information (NFRD), transposed into Spanish law by Law 11/2018 on Non-Financial and Diversity disclosures, seeks to increase the transparency and comparability of reporting by companies on their Environmental, Social and Governance (ESG) performance.

The CSRD establishes that companies falling under its scope should disclose their non-financial information in accordance with common standards. In this context, the European Financial Reporting Advisory Group (EFRAG) was designated as the European Commission's technical advisor, with responsibility for developing and issuing this new framework of standards: the European Sustainability Reporting Standards (ESRS). In this respect, EFRAG defined a total of 12 standards which encompass environmental, social and governance matters.

Section 4. Impacts, risks and opportunities management sets out details of how Banco Sabadell addresses and meets those standards.

In addition, the Sustainability Report remains compliant with the general provisions published in the preexisting Law 11/2018.

Lastly, this report includes information relating to Taxonomy-eligible exposures and/or exposures aligned with the Taxonomy Regulation (Regulation (EU) 2021/2178), which entered into force in January 2022.

Where appropriate, the Sustainability Report will contain information related to the upstream and downstream value chain. Specifically, for the topical ESRS, details are given of policies and actions related to suppliers and consumers or end-users. In this regard, both ESRS E1 related to Climate Change, which provides disclosure of the decarbonisation pathways of the financed portfolio, and ESRS S4 related to Consumers and End-Users, which sets out information related to customers, are related to the above-mentioned value chain. Similarly, ESRS G1 related to Business Conduct contains information about the management of relationships with suppliers. In addition, where the reported information refers to a phase of the value chain, this will be specifically indicated.

Lastly, Annex 6.1 Initiatives and alliances sets out other disclosure standards and alliances to which the Bank is adhered.

2. Governance

2.1 GOV-1: The role of the administrative, management and supervisory bodies

The governance system and the organisation of the different decision-making levels are both being continuously improved and adapted to the needs that are emerging from the new sustainability environment.

Board of Directors

With the exception of matters reserved to the Annual General Meeting, Banco Sabadell's Board of Directors is the most senior decision-making body of the company and its consolidated Group as it is responsible, by law and pursuant to the Articles of Association, for the management and representation of the Bank. The Board of Directors acts mainly as an instrument of supervision and control, delegating the management of the Institution's ordinary business matters to the Chief Executive Officer.

The Board of Directors is subject to well-defined and transparent rules of governance, in particular to the Articles of Association and the Regulation of the Board of Directors, and it conforms to best practice in the area of corporate governance. To ensure better and more diligent performance of its general supervisory duties, the Board is directly responsible for approving the Institution's general strategies. It also approves its policies and is therefore responsible for establishing principles, commitments and objectives in the area of sustainability, and for including them in the Institution's strategy.

As at 31 December 2024, the Board of Directors is made up of fifteen members. Of these, two are Executive Directors (13.33% of the total Board) and thirteen are Non-Executive Directors, while ten are Independent Directors (66.67% of the total Board), two are Other External Directors (13.33% of the total Board) and one is a Proprietary Director (6.67% of the total Board). There is no trade union representation on the Board.

As at 2024 year-end, there were six female directors, including five female Independent Directors out of a total of ten Independent Directors and one female Other External Director. Women represent 40% of the full Board of Directors, thus bringing forward the fulfilment of the Bank's commitment stated in Sabadell's Commitment to Sustainability and achieving early compliance with the provisions of Organic Law 2/2024 of 1 August on equal representation and balanced presence of women and men.

The matrix of competences and diversity of members of the Board of Directors set out below shows the horizontal and sectoral skills found in the Board of Directors.

Sectoral skills	Chair	Deputy Chair	CEO	Board Member
	Josep Oliu Creus	Pedro Fontana García	César González-Bueno Mayer	Aurora Catá Sala
	Ext. Dir.	Ind. Dir.	Exec. Dir	Ind. Dir.
Retail Banking	●	●	●
Corporate Banking	●	●	●	●
Financial and capital markets	●	●	●	●
Insurance	●	●	●
Other financial skills	●	●	●	●
Accounting and auditing	●	●	●	●
Risk management	●	●	●
Planning and	●	●	●	●
strategy
Governance	●	●	●	●
Risk control	●	●	●
Anti-Money Laundering and Countering the Financing of Terrorism	●		●
Legal	●		●
Digital and ICT (digital
transformation)	●		●	●
Human resources, culture,	●		●	●
talent and remuneration
Responsible business and sustainability	●		●
International experience:
Spain	●	●	●	●
United Kingdom	●		●
Mexico	●		●
Other	●	●	●
Horizontal skills
Governing bodies	●	●	●	●
Organisational management and leadership	●	●	●	●
Business experience	●	●	●	●
Governance and public
policy	●		●
Consultancy			●	●
Regulatory and supervisory bodies	●		●
Academic	●		●
Communication and
institutional relations	●		●

Sectoral skills
	Ana Colonques García Planas	Lluís Deulofeu Fuguet	María José García Beato	Mireya Giné Torrens	Laura González Molero	George Donald Johnston III	David Martínez Guzmán	Alicia Reyes Revuelta	Manuel Valls Morató	David Vegara Figueras	Pedro Viñolas Serra
	Ind. Dir.	Ind. Dir.	Ext. Dir.	Ind. Dir.	Ind. Dir.	Lead Ind. Dir.	Prop. Dir.	Ind. Dir.	Ind. Dir.	Exec. Dir	Ind. Dir.
Retail Banking	●	●	●		●	●		●
Corporate Banking			●		●	●		●			●
Financial and capital markets	●		●	●	●	●	●	●		●	●
Insurance								●	●
Other financial skills	●	●	●	●	●	●	●	●	●	●	●
Accounting and auditing	●		●	●				●	●	●	●
Risk management	●	●	●		●	●	●	●	●	●	●
Planning and
strategy	●	●	●	●	●	●	●	●	●	●	●
Governance	●	●	●	●	●	●		●		●	●
Risk control	●	●	●		●	●	●	●	●	●	●
Anti-Money Laundering and Countering the Financing of Terrorism			●		●	●		●	●	●	●
Legal			●					●
Digital and ICT (digital transformation)		●		●				●		●
Human resources, culture, talent and remuneration	●	●	●	●	●	●		●		●	●
Responsible business and sustainability	●		●		●			●		●	●
International experience:
Spain	●	●	●	●	●	●	●	●	●	●	●
United Kingdom			●			●	●	●		●
Mexico					●		●			●
Other		●	●	●	●	●	●	●		●	●
Horizontal skills
Governing bodies	●	●	●	●	●	●	●	●	●	●	●
Organisational management and	●	●	●	●	●	●	●	●	●	●	●
leadership
Business experience	●	●	●	●	●	●	●	●	●	●	●
Governance and
public policy		●	●						●	●
Consultancy		●		●	●					●
Regulatory and
supervisory bodies			●		●			●	●	●
Academic			●	●				●	●	●	●
Communication and institutional		●	●		●			●		●	●
relations

When defining the general strategy, the business objectives and the risk management framework of the Institution, the Board of Directors considers aspects related to sustainability, including climate-related, environmental, social and governance risks, and it also effectively oversees them.

In April 2024, the Board of Directors revised its Sustainability Policy, which incorporates ESG parameters into the activities and organisation of Banco Sabadell Group. This policy establishes the core principles that guide Banco Sabadell Group in its task of addressing the challenges of sustainability, defining the management parameters, as well as the organisation and governance structure needed for its correct implementation.

In relation to the management and control of environmental risk, the Board is ultimately responsible for embedding it into the general strategy and for establishing the necessary mechanisms for its review. Its duties range from monitoring environmental risk to approving and reviewing the organisational and functional framework for managing, controlling and reporting on this risk, approving the associated policies and reviewing them on an annual basis. Lastly, it is worth noting that the Board of Directors has received specific training on climate risk management, the impact deriving from those risks, policies and regulations in that regard, as well as measurement metrics such as the carbon footprint and decarbonisation pathways.

Board Committees

The Board Strategy and Sustainability Committee was set up in 2021 and is chaired by the Chairman of the Board of Directors, in the capacity of Other External Director. It is formed of five Directors: three Independent, one Other External and its Chair. This Board Committee met 15 times in 2024.

This Board Committee is responsible for analysing and reporting to the Board of Directors on environmental risk policies and for reporting to the Board of Directors on any amendments or periodic updates of the environmental risk strategy. It is also responsible for supervising the model for identifying, controlling and managing risks and opportunities in relation to sustainability including, where applicable, environmental risks.

Banco Sabadell continues to move forward with its activities and organisation to support and accelerate the important economic and social transformations that contribute to sustainable development and the fight against climate change.

Firm in its resolve, the Bank maintains its Commitment to Sustainability, approved in 2022, which sets out an action framework that integrates a forward-looking vision, for the period 2025-2050, of Environmental, Social and Governance (ESG) commitments in the Bank's strategy, aligns the Bank's business objectives with the Sustainable Development Goals (SDGs), and establishes levers to activate the transformation and promotion of initiatives in this area.

The Board Strategy and Sustainability Committee carries out regular monitoring of the Institution's progress in ESG matters through the review of the Corporate Sustainability Report, which contains information about the overall ESG environment in the context of the macroeconomic and regulatory environment, and about the Institution's ESG outlook, the integration of ESG risks into management arrangements and the priority indicators of Sabadell's Commitment to Sustainability.

As part of the above-mentioned regular monitoring and review of the Corporate Sustainability Report (CSR), the Board Committee was informed of the Institution's progress as a sustainable Institution through, among other things, the Sustainability Indicator and compliance with the the objectives set forth in Sabadell's Commitment to Sustainability, the presentation of the Institution's ESG training activities for employees, and the Institution's ESG plans, such as the 2024 ESG Communication Plan and the 2024 Activities Plan of the Internal Audit for Sustainability. In addition, through the CSR, information was also provided on progress made to mobilise sustainable financing and on aspects related to sustainability disclosure and rating agencies.

Lastly, the Board Committee reports to the Board of Directors, on a monthly basis, on all information concerning proposals, assessments, research and work carried out by the Board Committee in relation to matters within its sphere of competence discussed at its meetings each month.

On matters of strategy, the Chief Executive Officer takes part in the meetings, with full voting and speaking privileges, meaning that on such matters this Board Committee has six members.

With regard to sustainability, the Board Committee has the following duties:

• Analyse and inform the Board of Directors about the Institution's sustainability and environmental policies.
• Inform the Board of Directors of any modifications or regular updates of the sustainability strategy.
• Analyse the definition and, where applicable, amendment of policies on diversity and integration, human rights, equal opportunities and work-life balance and evaluate the level of compliance therewith on a regular basis.
• Review the Bank's social action strategy and its sponsorship and patronage plans.
• Review and report on the Sustainability Report prior to its review and reporting by the Board Audit and Control Committee and its subsequent sign-off by the Board of Directors.
• Receive information in connection with reports, documents or communications from external supervisory bodies within the scope of responsibility of this Board Committee.

Other Board Committees are involved to various degrees in the sustainability governance arrangements:

In 2021, the Board Appointments and Corporate Governance Committee took on duties in relation to the disclosure of internal corporate policies and regulations, the oversight of rules on corporate governance, and the relationship with shareholders and investors, proxy advisers and other stakeholders. This Board Committee is formed of three Independent Directors and one Other External Director.

The Board Audit and Control Committee oversees the process to prepare and submit regulated financial and non-financial information and escalates to the Board of Directors recommendations or proposals intended to safeguard its integrity. It is also in charge of reporting to the Board of Directors, prior to publication, on the financial information and the Directors' Report, which include mandatory non-financial information that the Institution is required to disclose on a regular basis. Where necessary and in coordination with the Board Risk Committee, it oversees and assesses the effectiveness of internal policies and systems for the control and management of all risks, encompassing the Institution's financial and non-financial risks, including operational, ICT, social, environmental, policy and reputational risks or those related to corruption, and it provides oversight to ensure that the main direct or indirect risks are reasonably identified, measured and controlled. This Board Committee is formed of four Independent Directors, its Chair being an audit expert.

The Board Risk Committee oversees the implementation of the Institution's Global Risk Framework Policy and is responsible for advising and supporting the Board of Directors with regard to the monitoring of the Bank's risk appetite and general risk strategy, taking into account all types of risks, to ensure that they are in line with the Institution's business strategy, objectives, corporate culture and values. This Board Committee is responsible for supervising and ensuring that all of the Group's risks are properly taken, controlled and managed, in accordance with the Group's Risk Appetite Statement, and for reporting to the Board of Directors on the performance of its duties. This Board Committee is formed of four Independent Directors.

Internal Committees

The Management Committee regularly monitors the Sustainable Finance Plan and any updates to the regulatory framework. It is also in charge of overseeing the aforesaid plan and resolving any incidents.

In addition, the Sustainability Committee, created in 2020 and chaired since 2021 by the General Manager and head of the Sustainability and Efficiency division, is the body responsible for establishing the Bank's Sustainable Finance Plan and for monitoring its execution, for defining and disclosing the general action principles in the area of sustainability and for promoting the development of projects and initiatives. It also manages any alerts that may arise in relation to ongoing initiatives or any developments in the regulatory, supervisory or other environments. It is made up of 11 members (ensuring the representation of several areas, including Sustainability, Risk, Finance, Business, Communication, Research Service and Regulation) and it meets once a month. This composition covers all the functional areas, which enables the cross-cutting establishment and implementation of the Sustainable Finance Plan and, therefore, the execution of the Institution's ESG strategy. The Sustainability Committee met 11 times in 2024.

Organisation

The Sustainability and Efficiency division was created in 2021 and is the unit responsible for defining and managing Banco Sabadell Group's responsible banking strategy, including the cross-cutting implementation of ESG criteria across all of the Bank's business units, affiliates and subsidiaries. The Sustainability and Efficiency Director is a General Manager who forms part of the Institution's Management Committee and reports directly to the Chief Executive Officer.

At the end of 2024, certain internal organisational changes were approved, applicable as from 1 January 2025, as a result of which the Sustainability division is to be integrated within the People division. The Director of the People and Sustainability division is a General Manager who forms part of the Institution's Management Committee and reports directly to the Chief Executive Officer.

The Sustainability division is a cross-cutting structure that has an overview of all new initiatives to be implemented in the Bank, collaborating in their definition, promoting them and taking charge of their monitoring.

Initially, the organisation focused on embedding the ESG risk strategy in its day-to-day operations, in its control arrangements and in the development of models and scenarios that consider these risks. Today, the Bank incorporates Sustainability both in its relationships with customers and suppliers and in internal processes.

As new sustainability functions are added and expanded, the Institution's structure is being adapted to include the necessary knowledge and skills in all the divisions responsible for ESG matters. The Bank is organised according to the system of the three lines of defence, and each line has teams dedicated to Sustainabilityrelated matters.

• With regard to the first line of defence, the business areas have been reinforced by setting up specific units that coordinate with the commercial teams to create sustainable financing solutions for customers, identifying trends and new social and environmental products and services. The Business Banking and Corporate Banking portfolio management teams have joined forces to ensure closer monitoring of sustainable transactions. In addition, the risk teams have also been expanded to perform their own ESG functions in portfolio risk management.

Other teams have added new functions related to sustainability, such as the Financial division where resources have been incorporated to build and analyse Sustainability data. In this respect, the Sustainability division has developed in the area of strategy and the Purchasing division includes supplier sustainability analysis for relevant procurement items.

In order to meet the growing regulatory and supervisory demands, the Research and Models teams have also been strengthened. These are the teams that add climate scenarios to the stress testing models and the Internal Capital Adequacy Assessment Process (ICAAP).

• Similarly, new members have been added to the Compliance, Credit Risk Control, Internal Control and Models Validation teams to reinforce the second line of defence and guarantee the quality of 1LoD systems in relation to the risk management and governance of sustainability processes.
• Teams of the third line of defence were also enlarged to take on audit functions related to governance processes, risk management activities and internal control in the area of sustainability.

The Bank is moving forward by steering its activity, organisation and procedures in order to make a solid contribution to sustainability and the fight against climate change. To this end, it aligns its sustainability strategy and business model with frameworks of reference, such as the Sustainable Development Goals (SDGs), which it revisits periodically in order to bring itself closer in line with, and expedite its achievement of, the Paris Agreement and the 2030 Agenda.

2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies

The material Impacts, Risks and Opportunities (hereinafter, IROs) have been identified using the double materiality analysis and are set out in detail in section 3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model. In this respect, the material IROs have been grouped into a total of six topics: Climate change mitigation and adaptation, Energy, Own workforce, Access to products and services and non-discrimination, Cybersecurity and data protection, and Business conduct. In this vein, the Management Committee is the highest level executive committee and is regularly informed of material impacts, risks and opportunities at top-level committee meetings.

The governance process for each of the above-mentioned topics is described below:

Climate change mitigation and adaptation

All matters related to climate change (mitigation and adaptation) are regularly reviewed by the Sustainability Committee¹ . The Management Committee, for its part, engages in regular monitoring of the Sustainable Finance Plan and updates to the regulatory framework.

In addition, those that concern business lending are submitted to the relevant Business Committees of the Institution, while those that relate to the measurement of borrowers' climate-related and environmental risks are relayed to the Technical Risk Committee.

As for the Board Committees, in relation to that to which each topic refers:

• Board Strategy and Sustainability Committee: Carries out regular monitoring of the Institution's progress in ESG matters through the review of the Corporate Sustainability Report, which contains information about the overall ESG environment in the context of the macroeconomic and regulatory environment, and about the Institution's ESG outlook, the integration of ESG risks into management arrangements and the priority indicators of Sabadell's Commitment to Sustainability. As part of the above-mentioned regular monitoring and review of the Corporate Sustainability Report (CSR), the Board Committee was informed of the Institution's progress as a sustainable Institution through, among other things, the Sustainability Indicator and compliance with the the objectives set forth in Sabadell's Commitment to Sustainability, the presentation of the Institution's ESG training activities for employees, and the Institution's ESG plans, such as the 2024 ESG Communication Plan and the 2024 Activities Plan of the Internal Audit for Sustainability. In addition, through the CSR, information was also provided on progress made to mobilise sustainable financing and on aspects related to sustainability disclosure and rating agencies.
• Board Risk Committee: One of the main responsibilities of the Board Risk Committee is that of putting forward the proposed Risk Appetite Statement (RAS) to the Board of Directors for its approval. It should be noted that the RAS has been strengthened over the past year through the inclusion of new environmental risk metrics linked to credit risk.
• Delegated Credit Committee: Approves or reports favourably to the Board of Directors, as applicable, on decisions concerning credit risk acceptance, credit risk refinancing and restructuring, and sales of foreclosed assets, according to the assumptions and limits established by the Board of Directors, following analysis by the Board Committee to ensure that the companies that are the subject of such decisions take sustainability indicators into account. In this respect, it reports on the company's classification and alignment with ESG guidelines through its compliance with those guidelines; its alignment with the sectoral pathway, as applicable; and its compliance with sectoral standards. It also reports on the company's ranking given by the Climate-related and Environmental Risk Indicator (CERI, referred to hereinafter in this report as IRCA, by its Spanish acronym). This indicator aims to objectively rank companies that are obliged to produce a Sustainability Report, based on their exposure to climaterelated and environmental risks, and according to their maturity in terms of managing those risks.

¹ For more details, see section 2.1 GOV-1: The role of the administrative, management and supervisory bodies

• Board Audit and Control Committee: During the year, in accordance with the duties incumbent upon it, the Board Committee has monitored and analysed the sufficiency, clarity and integrity of all financial and related non-financial disclosures published by the Bank, corresponding to both the Bank and the Group, prior to their presentation to the Board of Directors and their disclosure to the market and to supervisory bodies.
• Board of Directors² : Responsible for approving the Institution's policies, for establishing principles, commitments and objectives in the area of sustainability, and for including them in the Institution's strategy.

When defining the general strategy, the business objectives and the risk management framework of the Institution, the Board of Directors considers environmental aspects, including climate-related and environmental risks, and it also effectively oversees them.

Energy

Compliance with the commitments under the ESG framework, which include, among others, those related to the Institution's energy efficiency, is reported to the Sustainability Committee on an annual basis. The Sustainability Committee is the body that monitors the delivery of commitments undertaken under the framework of Sabadell's Commitment to Sustainability.

The Sustainability Committee also validates proposals for improvements to the energy efficiency of the Institution's facilities, while the corresponding budget is approved by the Management Committee.

Own workforce

In general terms, the top-level committee of the People division is the body in charge of supervising the strategy and direction of decisions that have an impact on staff, as well as conveying actions linked to the professional development of staff, the application of remuneration policies and the implementation of occupational welfare and work-life balance measures, to the governing bodies for their approval and supervision, in accordance with applicable regulations or internal policies.

Banco Sabadell also prioritises initiatives linked to reducing the gender pay gap and increasing the representation of women in management positions. In this regard, internal policies and procedures ensure that staff work in a workplace environment where equity and equality are strategic elements that guide the business culture. The Bank rolls out initiatives throughout the organisation and across all units to reduce and mitigate pay inequality between men and women and is committed to progressively reducing differences in that respect in order to move forward with its aim of supporting the economic and social transformation of our environment.

The monitoring and control of gender representation and the gender pay gap is a priority for the People division and is regularly reviewed by the unit's top-level committee. The aim of this mechanism is to assess the level of compliance with corporate objectives and the degree of success of the measures that the institution has in place in terms of diversity, equality and inclusion, focusing on aspects related to the gender pay gap and the representation of women. Additionally, the People division is in charge of conveying the outcome of relevant actions to the forums indicated below:

◦ Board Committees (Board Remuneration Committee, Board Appointments and Corporate Governance Committee, Board Strategy and Sustainability Committee): report on the main conclusions in the analysis of the Bank's remuneration models and the action levers to reduce the gender pay gap, aimed primarily at increasing female representation in positions with a higher functional value. Furthermore, the composition of the senior management group and the monitoring of gender diversity objectives are presented to the Board Appointments and Corporate Governance Committee on an annual basis, showing how they compare to peers and with the aim of complying with the current regulations related to gender equality and gender pay equity.

² For more details about the Board of Directors, see section 2.1 GOV-1: The role of the administrative, management and supervisory bodies

• Management Committee: this Committee validates, on an annual basis, compliance with the annual targets for female representation embedded in the sustainability indicator, which forms part of the Institution's corporate objectives.
• Managerial Performance Evaluation Committee (MPEC) and Divisional Employee Appraisal Committee (DEAC): this forum meets annually with the aim of deciding on changes to senior management staff, approving proposals for promotions to or demotions from that group, as well as verifying compliance with the gender diversity targets and the application of policies that seek to foster gender representation parity.
• Equality Plan Monitoring and Assessment Committee: assessment of the level of compliance and progress of actions and objectives set forth in the Equality Plan.
• Core and Business Groups Promoting Diversity, Equity and Equality: created in 2022 with the aim of driving forward initiatives, assessing the monitoring of indicators and promoting a culture with a holistic approach to diversity across all levels of the organisation.
• Equality Officer: person responsible for ensuring equal treatment and equal opportunities within the organisation chart. Has specific training in this area and supervises the execution of actions set forth in the Equality Plan.

Access to products and services and non-discrimination

Before marketing a new product or service, an internal workflow ("Product Workflow") is followed, where the relevant areas of the Bank review the various aspects to ensure they conform to the established standards. The subsequent validation by the areas involved is ultimately ratified by a high-level committee, the Technical Product Committee.

With regard to Sogeviso, (a subsidiary created and 100% owned by the Bank, which manages social housing matters), once a fortnight, as part of its duties, the Committee for Service Businesses monitors the Sogeviso social support programme and Jobs³ scheme. This Committee is responsible for keeping track of the monitoring of management indicators, such as the labour market insertion rate and the percentage of social or affordable housing rental contract renewals where the rent has increased among families in receipt of social support for more than 18 months. In addition, measures to enable a more efficient service are proposed and implemented and progress in this regard is discussed, in order to ensure the model is a good fit with the social context. The initiatives approved by this Committee are presented to the Bank's Management Committee for ratification.

In addition, in 2024 Sogeviso started up a new business line, for non-Group customers, focused on integrated management of newly constructed affordable rental stock associated with public-private partnership models. As a result of this initiative, over the year it has completed the deployment of Lot III of the Community of Madrid's "Plan Vive" and has actively participated in several housing tenders organised in Catalonia, Madrid, the Community of Valencia and Aragon.

On the other hand, in relation to the Code of Good Practice (Código de Buenas Prácticas, or CBP), whose main objective is to arrange for the viable restructuring of mortgage debt for primary residences and is aimed at persons in a vulnerable situation, aggregated information on customer applications to receive CBP assistance is prepared on a monthly basis, including monthly data on customers included under that scheme reported to the Bank of Spain. Information regarding the treatment of customers who expressed interest in this service but who, for different reasons, were not granted access to CBP measures, is also included. This information is sent to members of General Management who form part of the CBP Steering Committee. This information is also periodically sent to the Customer Conduct Risk Prevention team.

³ For more information on these programmes, see section 5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

Cybersecurity and data protection

The Information Security function sends regular cybersecurity status reports to governing bodies, such as the Management Committee, the Board Strategy and Sustainability Committee and the Board of Directors, which are the bodies responsible for overseeing the Institution's cybersecurity, along with the Board Risk Committee, which oversees ICT risks.

In relation to Data Protection, a plan setting out the necessary measures to monitor and supervise compliance with the Personal Data Protection Policy is submitted to the Management Committee on an annual basis. Every six months, a Supervision and Control Plan monitoring report is also sent to the Management Committee and to the Board Risk Committee.

In addition, the Annual Data Protection Report is compiled which, among other things, reports on monitoring of the Control Plan, and the Data Protection Officer's Report is issued, in compliance with the obligation of accountability to the Bank's Senior Management. This report is submitted to the Management Committee, the Board Risk Committee and the Board of Directors.

Business conduct

The Corporate Ethics Committee (CEC), reporting to the Board of Directors, is ultimately responsible for adopting policies on corporate reputation and ethical behaviour. Its core mission is to promote the ethical behaviour of the entire organisation to ensure compliance with the action principles set out in the Banco Sabadell Group Code of Conduct, the Internal Code of Conduct relating to the securities market (Reglamento Interno de Conducta, or RIC), the Corporate Crime Prevention Policy, the General Policy on Conflicts of Interest, the Anti-Corruption Policy and the Policy on the Internal Reporting System and Protection of Reporting Persons.

2.3 GOV-3: Integration of sustainability-related performance in incentive schemes

Banco Sabadell Group's Remuneration Policy is consistent with the goals of the risk and business strategy, the corporate culture, the protection of shareholders, investors and customers, the values and long-term interests of the Group, as well as with customer satisfaction and the measures taken to prevent conflicts of interest without providing incentives for excessive risk-taking.

To that end, Banco Sabadell Group's Remuneration Policy is based on the following principles:

• 1. Promote business and social sustainability in the medium-long term and ensure alignment with Banco Sabadell Group's values. This involves:
  2. Aligning remuneration with shareholders' interests and with the creation of long-term value.
  3. Implementing rigorous risk management, considering measures to prevent conflicts of interest.
  4. Aligning with Banco Sabadell Group's long-term business strategy, objectives, values and interests.
• 1. Ensure a competitive and fair remuneration system (external competitiveness and internal fairness) that:
  2. Is able to attract and retain the best talent.
  3. Rewards professional experience and responsibility, irrespective of the employee's gender. In this respect, Banco Sabadell Group's Remuneration Policy is based on equal pay for male and female employees for equal work or for work of equal value.
  4. Is aligned with market standards and is flexible, so that it can be adapted to changes in the environment and sector requirements.

• Reward performance, thereby aligning remuneration with individual results and the level of risk taken:

• Finding an adequate balance between the various remuneration components.

• Considering current and future risks and results, without providing incentives for excessive risk-taking beyond Banco Sabadell Group's tolerated threshold.
• Implementing a simple, transparent and clear-cut remuneration scheme. The Group's Remuneration Policy should be easy to understand and easy to communicate to the entire workforce.

The Banco Sabadell Group Remuneration Policy, in its entirety, includes information about the integration of sustainability risks. In particular, in terms of sustainability, the following aspects are taken into consideration:

• The remuneration policy and practices integrate sustainability risks and information in that regard is published on the Group's website. The remuneration policy and practices shall encourage behaviour consistent with the Group's risk-based approaches related to climate and the environment, as well as with the commitments voluntarily undertaken by the Group. In addition, they shall promote a long-term approach to the management of climate-related and environmental risks.
• Remuneration components must contribute to the promotion of environmental, social and governance actions in order to make the business strategy sustainable and socially responsible.

The specific operation of variable remuneration will be described in the Banco Sabadell Group companies' regulations. In any case, variable remuneration will be linked to results, in such a way that its total amount will be based on an assessment that:

• Combines the results of the Group, entity, business unit or division in which activities are carried out and/or those of the employee.
• Takes into account both financial and non-financial criteria, aligned with the strategic planning, budget and risks taken or indicators in the fields of environment, society, diversity and gender equality.
• In terms of long-term remuneration, multi-year targets will also be considered, based on quantitative criteria linked to a period long enough to properly reflect the risk taken.

Within the Group's objectives, the Synthetic Sustainability Indicator (SSI) has a weight of 10% in employees' variable remuneration and includes ESG metrics and indicators. In the case of the Executive Directors, this indicator has a weight of 14% for the CEO and 13% for the CRO. In terms of its composition, it is structured in four blocks: Green loans or sustainability-linked loans (40% weight); gender diversity indicators (percentage of female representation in management, 20% weight); indicators linked to the attainment of the Sustainable Finance Plan (20% weight); and score given by ESG rating agencies (20% weight).

Parameter	Definition	Weight
Rating agencies	Improve score on main ESG indices obtained from rating agencies (MSCI, Sustainalytics, DJSI)	20%
Sustainable Finance Plan	— Number of IRCA evaluations carried out — Setting new decarbonisation pathways — Meeting the decarbonisation pathways already established	20%
Diversity	% Women in management	20%
Sustainable Business	— GL financing — SLL financing	40%
Total	—	100%

Furthermore, to reinforce the alignment of remuneration with the Group's sustainability commitment, in 2023 a synthetic sustainability indicator was included in the multi-year targets set by the Group, directly linked to longterm remuneration, weighted at 20%. Its composition is structured around the synthetic indicator related to Sustainable Business (green & social loans, sustainability-linked loans, and other mobilised funds) and to Diversity (percentage of women in the management team).

In long-term remuneration, in addition to the annual targets established for short-term variable remuneration, the multi-year targets must be met. For the period 2024-2026 the multi-year target indicators are: shareholder value creation (relative Total Shareholder Return or TSR), weighted at 40%; profitability (Return On Tangible Equity or ROTE), weighted at 40%; and Sustainability (the above-mentioned synthetic sustainability indicator), weighted at 20%.

Additionally, some job functions have been assigned sustainability targets as part of their individual targets.

Targets will be set in such a way that the assignment of variable remuneration includes all current and future types of risk, with either annual and multi-year targets or with ex-ante adjustments to variable remuneration.

Banco Sabadell Group annual and multi-year targets, their weighting and their scale of achievement will be approved by the Board of Directors, based on a proposal by the Board Remuneration Committee. Guidelines on target setting and their weights for all staff members are approved by the Board Remuneration Committee. The individual targets of each staff group will be detailed in the corresponding remuneration policies.

2.4 GOV-4: Statement on due diligence

The Group takes into account sustainability risks in its assessment, management and control processes through the activities carried out.

In this respect, Banco Sabadell Group has a Sustainability Policy, which aims to provide a framework for all of the Institution's activity and organisation within ESG parameters. The Policy incorporates environmental, social and governance factors in decision-making and, at the same time, based on those factors, it responds to the needs and concerns of all of its stakeholders. The Sustainability Policy sets out the core principles on which the Group bases its approach to tackling the challenges of sustainability, and defines the corresponding management parameters, as well as the organisation and governance structure required for their optimal implementation.

Effective integration of environmental, social and governance risks into management arrangements requires a strategy and set of regulations that establish the guidelines, targets and limits required at different points of the credit approval workflow. The Bank therefore attaches great importance to the assessment of the climaterelated and/or environmental, social and/or governance risks of its counterparties.

Specifically, climate-related and/or environmental risks are set out in detail in section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities.

In terms of social risks, various social factors are considered, such as those related to rights, well-being, and the interests of people and communities. The risk of loss arising from any negative financial impact on counterparties stemming from the current or prospective impacts of social factors is also included. To that end, a series of actions linked to the process for identifying, measuring and managing social risk for both retail and business customers have been implemented. Although it is true that many of these actions apply to both types of customers, the Due Diligence Policy as regards the granting of credit is geared towards retail customers, while the Defence Sector Policy, the Eligibility Guide and the IRCA are actions mostly aimed at corporates⁴ .

The Group therefore has an Environmental and Social Risk Framework that consolidates the set of applicable criteria (sectoral standards) that are intended to limit the financing of customers or projects that the Institution considers to be contrary to the transition to a sustainable economy or that lack alignment with international regulations or best practices in the industry.

⁴ For more information on these actions, see section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities

The above-mentioned Framework also integrates compliance with the rules and standards at the level of social risk⁵ , some sector-specific (e.g. in the energy and agricultural sectors, special consideration is given to the negative impact they may have on society and local communities), and others of general application, such as the International Labour Organisation (ILO) Conventions and the UN Guiding Principles on Business and Human Rights. In this regard, the Framework has the same thresholds and scopes of application and the same mechanisms for effective implementation as those described in section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities, including the dispute screening tool provided by a reputable third-party supplier. Specifically, the general exclusions limiting the financing of companies with a high level of social risk, regardless of the sector to which the borrower belongs, are:

• a. Companies for which Banco Sabadell has sufficient reason to believe that they employ child labour or forced labour, as defined in the ILO conventions, or that have participated in human rights violations and/or that do not follow the principles of the Institution's human rights policy.
• b. Companies involved in the resettlement of indigenous or vulnerable groups without their free, prior and informed consent, or that otherwise infringe the rights of those groups.
• c. Companies for which Banco Sabadell has sufficient reasons to believe that they are in material breach of applicable laws and regulations in relation to human rights and the environment, even if the circumstances in question do not constitute a breach of the local legislation of each country.
• d. Companies that do not have health and safety policies in place to protect their workers, such as OHSAS 18001 or ISO 45001.

On the other hand, the Group has a Human Rights Policy and a related Due Diligence Procedure, both approved in 2021, which are reviewed annually and are applicable to all Group companies. They establish basic principles of action, as well as the mechanisms required to identify, prevent, mitigate and/or remedy any potential negative impacts on human rights that the Bank's activities and processes may entail, in particular with regard to granting finance to companies, or in relation to its human resources management model or supplier engagement processes. They also establish the need for employees to receive training in all of these areas. The principles governing the Human Rights Policy take into consideration the impact and relationship with four main stakeholder groups: Group employees, customers, suppliers and commercial partners, and the communities or environment in which the Group conducts its business and operates.

The Group also has a new version of the Group Code of Conduct, first approved in 2021 by the Board of Directors, which underwent an in-depth review to adapt it to regulatory requirements, supervisory guidelines and specifications, and to market standards. Every member of the Group's workforce was required to read and expressly accept the new version of the Group's Code of Conduct.

2.5 GOV-5: Risk management and internal controls over sustainability reporting

The main function of the Internal Controls over Sustainability Reporting (hereinafter, ICSR) unit is the design and implementation of the general control framework corresponding to Banco Sabadell Group's Sustainability Report.

This includes the identification of significant quantitative data generation processes involved in generating the quantitative information contained in the Sustainability Report. A data generation process is considered to be one which generates quantitative indicators associated with the Impacts, Risks and Opportunities (IROs) stemming from the double materiality analysis and one which comprises common elements, such as a data origination source and the processing and analysis of those elements prior to final disclosure.

The ICSR unit analyses those data generation processes, through a thorough analysis with the expert areas involved, and identifies the risks associated with those processes, which are related to the content of the Comisión Nacional del Mercado de Valores (CNMV) guidance that serves as the frame of reference, and controls

⁵ For information related to the environmental approach of the Environmental and Social Risks Framework, see section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities

are designed and incorporated, jointly with those responsible for the data, to mitigate the previously identified risks.

The resulting matrix of risks and controls provides a holistic view of the processes and systems involved in producing the Sustainability Report. The matrix can be consulted to identify the executor and the reviewer of the control, the data that it covers and the process to which it belongs, among other fields.

Furthermore, with the entry into force of the new European Corporate Sustainability Reporting Directive (CSRD), the ICSR unit has identified risks and designed controls over the new double materiality exercise in order to ensure the correct execution of this exercise and its completeness.

Based on the above-mentioned Directive, content controls have been established over the qualitative information disclosed throughout the Sustainability Report in relation to policies, actions, metrics and targets, as these are considered to constitute sensitive information and there are risks involved in their disclosure to the markets.

With regard to the assessment of the established controls, which mitigate the associated risks through their prevention or detection, this is carried out using the Bank's Governance, Risk and Compliance (GRC) tool, which is managed by the ICSR unit, where the areas responsible complete assessment forms accompanied by evidence supporting each of the controls.

Having completed the assessment, the GRC tool managed by the ICSR unit has a certification module that can be accessed by members of Senior Management. The certification process is based on the hierarchical and organisational ratification, at three levels, of the result achieved in the assessment of the controls.

The Board of Directors delegates the supervisory function regarding the internal control systems to the Board Audit and Control Committee. Every six months, the current situation of the ICSR as a result of new applicable regulatory requirements is reported to the Board Audit and Control Committee and to the Technical Committee on Accounting and Financial Disclosures. In addition, every year after the end of the tax year, the result of the assessment of the controls and the conclusions derived from it are escalated to the Board Audit and Control Committee.

3. Strategy

3.1 SBM-1: Strategy, business model and value chain

The Institution's business model is geared towards profitable growth that generates value for shareholders. This is achieved through a strategy of business diversification based on criteria related to profitability, sustainability, efficiency and quality of service, together with a conservative risk profile, while maintaining high standards of ethics and professional conduct combined with sensitivity to the interests of all stakeholders.

-

-

-

-

-

-

Note: Data as at December 2024.

• 1. Of which: 13,156 in Spain, 4,761 in the UK, 526 in Mexico and 326 in other geographies.
• 1. ESG score out of 100: A+ (Excellent with a score of 96-100), A (High with a score of 75-95), B (Medium-High with a score of 50-74), C (Medium-Low with a score of 25-49) and D (Low with a score of 0-24)
• 1. Accenture benchmarking of major Spanish financial institutions (2024 data).
• 1. Data taken from the annual customer experience study of companies with turnover >€2m carried out by Accenture in 2024 (September December).
• 1. Calculated as the change in tangible book value per share excluding the share buyback, the dividend distribution and the impact of buybacks over the past 12 months on the tangible book value per share.
• 1. Funds sold under the SABAM brand and other Amundi asset manager brands. Considered sustainability funds as per Article 8 or 9 of the EU's SFDR.

The Group's strategy promotes sustainable financing and investment to drive forward the transition towards a more sustainable model and a low-carbon economy, offering customers and investors the best possible solutions. Thus, the Bank committed to mobilise €65bn in sustainable finance between 2021 and 2025. Up to December 2024, more than €57.9bn had been mobilised, €19bn of them during this year.

To honour this commitment, the Bank is taking further action to raise awareness and offer advice across all sectors of the business fabric, offering solutions to finance the investments required for this transition.

• Sustainable financing solutions:
  • Financing solutions in the different business lines:

To bring processes for loan approval, portfolio management and reporting tasks in line with international standards on sustainable financing (the Green Loan Principles and Sustainability-Linked Loan Principles issued by the Loan Market Association and the Green Bond Principles and Sustainability-Linked Bond Principles issued by the International Capital Market Association, ICMA), in 2020 the following types of financing were defined, according to the intended use of the funds:

• Green and Social Loans (GSLs), in which the use of the funds is the main criterion for determining the green, social or sustainable nature. This type of financing is closely related to Banco Sabadell's Sustainable Financing Framework, whose main references are the EU Taxonomy and the best practices in the market such as the Green Loan Principles, and to the green bonds issued by the Bank in recent years under the SDG Bond Framework.

To promote GSL transactions, the Bank has approved discounts that allow it to offer better prices to customers.

The rollout of the Next Generation EU Recovery Funds is expected to significantly boost this type of financing (the section "Next Generation EU" provides more details about the actions that the Bank is taking in relation to the aforesaid funds).

• Sustainability-Linked Loans (SLLs), which relate to the type of financing that incentivises the achievement of sustainability targets, linking the transaction price to the evolution of one or more KPIs. This category does not require the funds to be used for any specific purpose. It is considered essential that the selected indicators be relevant for customers, as this enables their sustainability strategy to gain more traction.
• Issuance of own sustainability bonds (more details in section 5. Issuance of Banco Sabadell sustainability bonds).
• Sustainable savings and responsible investment solutions (more details in section 4. Sustainable savings and responsible investment solutions).
• Specialist advice:
  • Specialised teams: trained and certified in sustainability, they have a cross-sectoral perspective of the topic, which allows them to identify the most suitable solutions according to each customer's needs.
  • Expertise hubs: cross-cutting units specialising in sustainability that support customers in the areas of structured finance and corporate & investment banking, in addition to helping them to find and apply for subsidies for the Next Generation funds.
  • Personalised support: a personalised support service is offered on an individual basis to corporate customers, with regular visits to identify the progress made in implementing ESG criteria, to delve into future challenges and to identify the most appropriate solutions through sustainable finance according to each customer's needs.

▪ Ongoing advisory service: ongoing advisory programme with outreach and awareness-raising actions, through the Bank's own channels, such as the Companies Hub and its series of conferences.

1. Sustainable financing solutions for the Corporate & Investment Banking businesses

Corporate & Investment Banking (hereinafter, CIB) is the business unit that offers financial and advisory solutions to large corporations and financial institutions, both within Spain and internationally.

As at the end of 2024, the Bank had taken part in 112 sustainable financing and investing transactions in the area of CIB, which includes corporate business transactions and investment banking transactions.

	No. of Transactions	Volume
Corporate	92	2,873
Investment Banking	10	4,251

The information shown in the table above is explained here below:

1.1 Corporate Banking

In 2024, in the Corporate Banking segment, 92 transactions were signed for a total of 2,873 million euros, increasing by 41% compared to 2023. Of these, 50 transactions amounting to a total volume of 1,298 million euros are considered green and social loans because they are covered by the Bank's Sustainable Financing Framework. In addition, 42 sustainability-linked loans were carried out amounting to a total of 1,575 million euros.

The issuance of sustainable guarantees has been promoted, in which the company or singular asset to which the guarantees relate qualify as sustainable.

In addition, customers have continued to be supported with short-term sustainable finance solutions, which directly or indirectly involve the value chain, both during upstream phases (suppliers) and downstream phases (customers). Thus, not only the negative impacts generated by our customers' production processes are considered, but those generated in their value chain are considered also.

In any event, operations are being monitored on a continuous basis jointly with customers and sustainability agencies through the KPIs defined for each loan. This allows us to better understand the positive impacts of our lending and to identify potential new sustainable financing needs that may arise for our customers.

Sustainable financing is prioritised as a formula to support customers and it is increasingly being included in credit approval procedures. In fact, in some cases the authorisation of new transactions is conditional upon the inclusion of an ESG element in the financing structure. To that end, custom proposals are being developed according to the needs of customers, their sustainability strategy and factors specific to their industries.

1.2 Investment Banking

In 2024, Banco Sabadell was the placement entity of green and sustainability bonds in the primary debt market, participating as Joint Lead Manager in the following public issuances for customers:

• Basque government: sustainability bond in the amount of 600 million euros, with a 10-year maturity and a 3.400% coupon, issued in February.
• Madrid autonomous community: sustainability bond in the amount of 1 billion euros, with a 10-year maturity and a 3.462% coupon, issued in February.
• Xunta de Galicia: sustainability bond in the amount of 500 million euros, with a 7-year maturity and a 3.296% coupon, issued in May.
• Junta de Andalucía: sustainability bond in the amount of 500 million euros, with a 6-year maturity and a 3.200% coupon, issued in June.

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• FCC Servicios de Medioambiente: sustainability bond in the amount of 600 million euros, with a 7-year maturity and a 3.715% coupon, issued in October.

The Bank also took part in a further three sustainable operations with investors for an aggregate value of over 50 million euros.

Furthermore, during 2024, it participated in the following Banco Sabadell green bond issues:

• As Joint Lead Manager in Banco Sabadell's green public issuance of senior non-preferred debt in the amount of 500 million euros with a 4.25% coupon, issued in March.
• Banco Sabadell's green public issuance of senior non-preferred debt in the amount of 500 million euros with a 3.5% coupon, issued in November.

1.3 Project Finance

The renewables market in Spain and Portugal had a year with positive developments, such as the progress made in implementing and starting up operations in new solar and wind power plants, in line with the previous year, and granting licences for new projects to ensure a sizeable pipeline in the coming years. This is in contrast with some negative developments, notably very high price volatility, with particularly low prices in the second quarter, which had a considerable influence in driving down prices of PPAs⁶ and, ultimately, the profitability of the projects.

Despite this instability, Banco Sabadell has continued to offer finance for renewable projects as one of the main banks in Spain, demonstrating its commitment to the "Fit for 55" measures introduced by the European Union and to Spain's Integrated National Energy and Climate Plan (Plan Nacional Integrado de Energía y Clima, or PNIEC).

Over the year, 39 projects received a total of 1,228 million euros in finance. According to Infralogics, the Bank featured in the ranking of banks that provide finance for renewable energy projects in Spain and Portugal, ranking second in terms of number of transactions and third in terms of volume of transactions.

In 2024, a total of 7,644 MW of renewable energy capacity was installed, 6,735 MW of them in solar power plants, which is the highest figure ever recorded, topping the previous year's figure by 27%. With the installation of these power plants, as at November 2024, wind and solar power plants represented 44.8% of the installed capacity and, if hydraulic power is added, this figure rises to 58%.

During 2024, a record number of licences were granted for new renewable power plants. Up to September, Environmental Impact Statements (EISs) had been released for a total of 54.9 GW, of which 14.8 GW had an administrative construction authorisation (Autorización Administrativa de Construcción, or AAC). The remainder is expected to receive that authorisation soon. All of these power plants have until 2027 to connect, so the new power plants installation pipeline is ensured, always provided conditions are favourable to go ahead with the development.

To put all licensed power plants in operation, it is important for prices to be less volatile and become stable, something that did not happen in 2024. Indeed, price seasonality in 2024 was very pronounced. The second quarter saw particularly low prices due to high hydrolicity (quantity of water), mild temperatures and considerable use of both solar and wind energy. In contrast, the second half of the year was marked by an increase in demand due to hot weather in July/August and cold weather in November, combined with a gradual increase of natural gas prices, which more than doubled between March and November. The average baseload price in Spain was €63.04/MWh (down by €24.06 compared to the €87.10/MWh recorded last year) but with considerable price differences; for instance, the average price was €13.67/MWh in April and €111.39/MWh in December.

The main challenges for the coming years relate to the introduction of batteries and hydrogen to stabilise prices, as well as the development of data centre projects to increase the demand for energy.

⁶ Power Purchase Agreement

In terms of production, during 2024, 39 transactions with a volume of €1,228m were booked, representing an increase of 8% in terms of the number of transactions, and of 11% in terms of volume. It is worth noting the volume recorded in the USA, which went from €45m in 2023 to €295m in 2024.

Country	# Transactions	Amount	%
Spain	28	923	77%
UK	1	10	1%
USA	10	295	23%
TOTAL	39	1,228	100%

Data in millions of euros.

In terms of technology, it is worth noting the increased financing provided for wind power projects, which went from €319m in 2023 to €486m in 2024, which helps us to balance out the portfolio mix. In addition, financing was provided for two hybrid energy projects that combine photovoltaic plants and Battery Energy Storage Systems (BESS).

Technology	# Transactions	Amount	%
Wind	16	486	40%
Photovoltaic	21	669	54%
Solar + BESS	2	73	6%
Total	39	1,288	100%

Data in millions of euros.

2. Sustainable financing solutions for Business Banking

The Business Banking unit offers financial products and services to legal entities and natural persons for business purposes, serving all types of companies with turnover of up to 200 million euros, as well as the institutional sector.

Green and social loans

In 2024, more than 4.1 billion euros were mobilised through companies using the funds for purposes aligned with the Bank's Sustainable Financing Framework, mainly through medium- and long-term financing, which includes secured and unsecured loans, leases and rentals, and guarantee facilities. These do not include Renewable Energy Project Finance transactions, which are described individually in previous sections.

With the aim of helping companies to execute their sustainable projects more efficiently, Banco Sabadell has entered into a number of agreements with partners from a variety of sectors so as to offer turnkey solutions:

• Photovoltaic self-consumption: the Bank has agreements with Iberdrola and EDP Solar to provide a comprehensive service that includes both photovoltaic systems and the maintenance and upgrade service, to ensure that the installation remains optimal for customers' interests.
• Building retrofits: the Bank has an agreement with Agentia R+ as renovation agent, leading the entire project, including the management of public subsidies.

Sustainability-linked loans

As at the end of 2024, the Bank had mobilised more than 3 billion euros in sustainability-linked loans for corporates and SMEs to fund green purposes only, primarily focused on the reduction of their CO2 emissions.

Sabadell Renting's mobility solutions

In 2024, Sabadell Renting continued to improve its offer of ECO or green vehicles, thanks to its considerable efforts to focus on its sustainable mobility activity.

In 2024, ECO vehicles (hybrid and electric vehicles with an 'ECO' or 'zero emissions' environmental label issued by Spain's traffic authority, DGT) accounted for 67% of all vehicles on offer, while the number of new contracts signed for ECO vehicles as a percentage of the total was 43%.

Sabadell Renting continues to increase the visibility of sustainable mobility solutions through direct campaigns aimed at the Bank's customers (both retail banking and business banking customers) throughout the year, promoting the ECO vehicles offered by the market and, above all, placing a sharp focus on the electric vehicles that it offers, with specific campaigns for all staff at Banco Sabadell.

In terms of the sales volume of second-hand vehicles, there was a significant increase in the sale of vehicles up to four years old. This sales volume also contributes to the renewal of the vehicle fleet and, in parallel, to the improvement of urban environments with vehicles that are more efficient and have much lower CO2 emissions.

Social loans

In the area of social loans, it is worth highlighting those granted to micro-enterprises for the purpose of promoting and maintaining employment.

In 2024, SMEs and micro-entities were granted more than 2.8 billion euros in finance, mainly through loans and credit, thereby helping to maintain employment and facilitating the development and progress of the business and industrial fabric of each region. This brings the cumulative amount granted between 2021 and 2024 to over 11.5 billion euros, representing 77% of the target set for the 2021-2025 period of 15 billion euros.

The Bank monitors the impact of the financing granted to SMEs and micro-entities. This way, out of all SMEs and micro-entities that received financing in 2022, over 68% maintained or increased their number of employees (data as at 2023 vs 2022⁷ ) and over 73% improved their sales volumes.

In addition, in relation to the financing granted in 2024 to self-employed professionals, it should be noted that 46% was granted to women.

Support for businesses

In order to help businesses achieve a better understanding of sustainability, a series of webinars were organised through the Bank's Business Hub which, drawing on examples of good practice implemented by customers and experts, dealt with aspects related to the Next Generation Funds, which cover the sustainability pillar. In this respect, sessions were held in connection with the sector-specific strategic project for economic recovery and transformation (Proyecto Estratégico para la Recuperación y Transformación Económica, or PERTE) for the Circular Economy, as well as two sessions concerning the new ICO MRR funds offered by Spain's Official Credit Institute (Instituto Oficial de Crédito, or ICO) in relation to recovery and resilience mechanisms (Mecanismos de Recuperación y Resiliencia, or MRR), which consider a green ICO MRR second-floor facility subscribed by Banco Sabadell.

The annual visit to businesses now includes a conversation about sustainability, providing customers with the necessary background information and explaining the benefits of moving towards sustainability, and proposing financing solutions for projects that enable greater energy efficiency and a reduction of their carbon footprint.

Next Generation EU

Financial institutions have the responsibility of supplementing the funds made available by European institutions in order to repair the consequences of the pandemic as much as possible and move towards a more sustainable economy. It is also essential to provide the maximum possible capillarity to the programme of European funds in order to ensure that it is rolled out to the entire business world, including SMEs.

To that end, various specific products are made available to businesses in order to advance subsidies, supplement them if they do not cover the entire investment, or to provide the authorities with any guarantees they may require.

Banco Sabadell wishes to support businesses on this journey and, to that end, several campaigns have been launched with the aim of spreading knowledge about subsidies and offering turnkey solutions that include a value proposition from the main partners in the market in each of the main areas for which subsidies are available and about the financing or guarantees that may be necessary to develop the associated projects.

⁷ Calculations based on public information contained in annual accounts, corresponding to 80.17% of financed enterprises. Information not available for this year

• Business digitalisation: after KIT Digital opened its call for proposals in March 2022, several additional calls followed it aimed at companies of different sizes. In July 2024, the Consulting Kit was launched. This is a digital advisory voucher for the amount to be used by the company in question to hire advisory services in relation to digital aspects.

With the aim of helping customers make the most of this financial assistance, an agreement was reached with mobile company Masmóvil to provide companies with digitalisation solutions.

• Photovoltaic self-consumption: this is a package of government aid amounting to 1,320 million euros, which is intended to promote self-consumption and energy storage, and renewable heating systems. This provides an opportunity for businesses to carry out investment projects aimed at self-consumption, and allows them to benefit from the complementary financing offered by Banco Sabadell.

In this respect, the agreements with key market players, such as Iberdrola and EDP Solar, allow us to offer customers turnkey solutions, which are complemented by the financing that customers may need.

• Home renovations: the Next Generation EU funds offer grants for home or building renovations linked to energy efficiency and renewable energy projects. The main beneficiaries are homeowners' associations. The amount of the subsidy will vary depending on the savings delivered by the renovations.

Participation in PERTEs⁸ :

Spain's PERTEs are a new concept, conceived as a mechanism to promote and coordinate top priority projects of a strategic nature given their impact on economic growth, employment and competition in a particular sector. Their aim is to serve as a point of connection between public and private initiatives, as they provide a predictable legal framework to develop innovative and collaborative solutions.

The Addendum to the Spanish Recovery and Transformation Plan (Plan de Recuperación y Transformación, or PRT), approved in October 2023, anticipates a significant increase in funds allocated to investments in PERTE projects, with an amount totalling 41,287 million euros. Throughout 2024, significant progress has been made in announcing calls for proposals for various PERTEs, including one for electric vehicles (second call), the PERTE for the shipping industry, the one for the water cycle and the agri-food project.

In July 2023, the Bank signed an agreement with PYMAR, a body representing small and medium-sized shipyards, to offer guarantees under improved conditions to companies participating in the shipbuilding PERTE. Following the final resolution of this PERTE in January 2024, the Bank granted guarantees for 45 projects amounting to over 13 million euros.

3. Sustainable financing solutions for the Retail Banking business

Retail Banking is Banco Sabadell's business unit that offers financial products and services to individuals for personal use. Banco Sabadell supports customers in the transition to a more sustainable economy, offering a range of solutions with products and services for home purchases and renovations, sustainable mobility or the installation of renewable energies and wastewater treatments. In addition, the Bank offers investment opportunities that contribute to sustainability.

In its commercial relationship with the consumer segment, the Bank considers both environmental and social approaches when it originates its financial transactions. On one hand, in relation to the environmental factor, it takes into account the ecological aspect of assets in which customers are thinking of investing. The Bank focuses primarily on green mortgages, considering properties that have the highest energy efficiency performance ratings as "green assets". In addition, "green assets" also include those that are aligned with the activities defined in the Institution's Eligibility Guide and that are, at the same time, linked to personal loans. The types of properties included in this category are mainly electric vehicles and solar panels, although there are others. On the other hand, where the financed property qualifies as council housing, this is taken into account when evaluating the social factor.

⁸ Strategic Projects for Economic Recovery and Transformation (Proyectos Estratégicos para la Recuperación y Transformación Económica, or PERTEs)

It should be noted that Sabadell Consumer Finance, the consumer finance institution wholly owned by Banco Sabadell, has signed partnership referral agreements with companies that focus on providing sustainable solutions for their customers. In 2024, the growth of the photovoltaic installations sector slowed down, mainly due to the reduced price of electricity (a factor that directly influences investment decision-making). This development created a new opportunity for aerothermal products and batteries. As for the installation of vehicle charging points, there is a direct correlation with the number of electric vehicles sold.

In addition, the ESG dimension is embedded throughout the commercial and risk process, assessing transactions from origination onwards. This means that account managers proactively offer sustainable financing solutions when they see that customers have the opportunity to invest in "green assets", such as energy-efficient homes or electric vehicles. There is also the option of applying a positive price adjustment for transactions whose ultimate purpose is to acquire a "green asset". This way, there is a bigger incentive for the customer or for the account manager, who is in a better position to negotiate sustainable transactions.

Lastly, in terms of payment systems, Banco Sabadell continues to work towards its objective of reducing its environmental impact, encouraging customers' use of digital payments through virtual cards, which are included in all in the main X-pay systems (Google Pay, Apple Pay, Samsung Pay, etc.). Furthermore, for customers with physical cards, these are manufactured with recycled biodegradable PVC materials, thus avoiding the generation of plastic and offering customers the opportunity to do their part in overcoming this challenge.

Green financing solutions for individuals

In the case of products designed to finance project development or sustainable initiatives, it is worth mentioning the following solutions that Banco Sabadell offers its customers:

• Green mortgages: Banco Sabadell offers a reduced price across its entire mortgage range to incentivise the purchase, construction or renovation of homes with the highest EPC ratings (A+, A or B), in accordance with the national certification system and in line with the Institution's Eligibility Guide.

In 2024, the volume of new mortgages with sustainable certification came to more than 589 million euros.

• Sabadell green renovation loan: the aim of the Sabadell 'eco-reformas' (green renovation) loan is to encourage home renovations and/or purchases that improve the sustainability and energy saving capacity of a primary or secondary residence. The Bank offers financing, with attractive conditions, for improvements of openings (windows and doors), upgrades of heating or cooling systems to make them more efficient, and purchases of energy-efficient household appliances, i.e. those with an EPC rating of A or higher.
• Sabadell green car loan: the Bank offers the 'préstamo coche ECO' (green car loan), aimed at retail customers, which enables the purchase of 'zero emissions' or 'ECO' labelled vehicles with very attractive conditions, thus contributing to the adoption of cleaner vehicles that are suited to the new low-emission zones in Spain's largest cities.
• Renting mobility solutions: as explained above, Sabadell Renting also offers ECO or green vehicles to retail customers, thanks to having placed considerable focus on its sustainable mobility activity.

Social financing solutions for individuals

In the area of social financing, due to the economic impact of some extraordinary economic circumstances, Banco Sabadell continues to proactively offer solutions to customers with or without mortgages who may be experiencing difficulties, in addition to customers who meet the vulnerability criteria in accordance with the Code of Good Practice, with the aim of helping those customers to meet their obligations, relieve their financial burden and avoid default situations.

With regard to vulnerable customers⁹ , it should also be noted that:

• Customers at risk of social exclusion who have been officially recognised as refugees (they hold a white or red card) or who have limited resources may open Banco Sabadell's Basic Payment Account free of charge, thus gaining access to free services such as as cash withdrawals using debit cards, domestic transfers and transfers to EU countries, direct debits, and online banking, among others. 580 Basic Payment Accounts were opened in 2024 including 70 opened by vulnerable customers. In terms of the account holders, 595 people opened a Basic Payment Account, 71 of whom belonged to a vulnerable group.
• There are specific benefits for customers aged 65 or over, such as the issuance and renewal of a commission-free passbook and free transfers throughout Spain and in the European Economic Area carried out at a branch. Furthermore, customers who are pensioners and have income of less than 10,000 euros per year can access certain additional subsidies and benefits.
• The customer service model is particularly mindful of vulnerable customers (those vulnerable due to their age, reduced mobility or other constraints) and/or non-digital customers (those with no access to remote banking), with specific protocols for this group to address specific situations, such as the closing of branches, changes to the usual services offered and certain risk transactions such as cash withdrawals at branches, offering them unique support tailored to the possibilities of each customer.
• The Code of Good Practice is applied when granting financing transactions to safeguard the interests of customers, ensuring that they choose the product that is best suited to their needs and to their financial capacity, paying particular attention to customers in vulnerable situations (natural persons who, due to their abilities, needs or personal, economic, educational or social circumstances, find themselves in a situation of distress or helplessness that prevents them from going about their daily lives in the same conditions as other consumers).
• Lastly, the Code of Good Practice for the restructuring of mortgage loans of vulnerable customers (Royal Decree Law 6/2012 and Royal Decree Law 19/2022) has been updated and made more flexible to meet the needs of mortgage borrowers with the lowest incomes. For customers with complex financial needs who do not meet the the requirements of the Code of Good Practice, other solutions are explored that are appropriate to their current financial position or vulnerability.

4. Sustainable savings and responsible investment solutions

In the area of investment, both pension fund manager BanSabadell Pensiones EGFP S.A. in 2012 and, since 2016, Aurica Capital, a venture capital enterprise that invests in Spanish companies with plans to expand in foreign markets, have adopted the United Nations Principles for Responsible Investment (PRI) in the investment manager category. Pension funds individually subscribed to the PRIs by BanSabadell Pensiones EGFP S.A. include BanSabadell Pentapensión Empresa FP, the Fondo de Pensiones de los Empleados de Banco Sabadell MF2000 pension fund, the Fondo de Pensiones de los Empleados de Banco Sabadell GM pension fund, the BanSabadell 18 FP pension fund, and the Fondo de Pensiones de la Compañía de Servicios de Bebidas Refrescantes pension fund.

4.1 Savings and investment or similar products

With regard to mutual funds, Banco Sabadell maintains its strategic alliance with Amundi, Europe's leading asset manager, which has been committed to sustainable investment since its creation. Amundi has been a signatory of the United Nations Principles for Responsible Investment since 2006.

⁹ For more detailed information in relation to vulnerable customers, see section 5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

As at 2024 year-end, 24 Sabadell Asset Management funds (8,303 million euros) promoted environmental or social characteristics, meaning that they are classified as Article 8¹⁰ funds under the European Sustainable Finance Disclosure Regulation (SFDR). When combined with the Amundi mutual funds distributed by Banco Sabadell (5,717 million euros), it means that 14,020 million euros, or 84%, of Banco Sabadell customer assets invested in non-guaranteed Sabadell Asset Management or Amundi mutual funds promote environmental or social characteristics or have environmental or social objectives (Article 8 or Article 9 of SFDR¹¹).

The process of expanding the range of investment and savings products that meet sustainability criteria continued in 2024 with the addition of two new funds, bringing the total number of Sabadell Asset Management funds that comply with Article 8 of the SFDR to 24. As at 2024 year-end, customer assets in mutual funds meeting ESG criteria stood at 83%, remaining above the target set for 2025 of 80%, although slightly below the 2023 figure as a result of market developments and customers' strong preference for guaranteed or target yield products, which are mainly structured with government bonds of EU Member States that do not qualify as sustainable.

It is also worth noting the launch of a new discretionary portfolio management service, called Cartera Sabadell, which qualifies as an Article 8 product according to the SFDR. This new service offers various portfolios to be selected by the customer according to their risk profile, with a minimum investment of just €500, making it an accessible option for the Bank's customers.

Training on ESG investment aimed at all commercial team members who provide advisory services to customers continued to be imparted, and helpful information sheets were created for customers to clarify any doubts they might have about the key concepts in relation to their sustainability preferences (Taxonomy, SFDR and Principal Adverse Impacts).

The Banco Sabadell Policy on Integrating ESG Risks in Savings/Investment Products was updated in 2024 with the latest progress made in that regard, submitting initial evidence of its application in 2021. This Policy is framed within Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector.

It is important to emphasise that 2024 saw a continuation of the work that began in 2022 of incorporating customers' sustainability preferences into discretionary portfolio management and advice models, which were adapted to the new suitability guides published in 2023. Lastly, the Institution's second Principal Adverse Impacts Report (available in Spanish) was published in 2024. This report shows whether investment decisions have had an impact on the environment, social aspects and corporate governance, according to various regulatory indicators. This report is available to customers and non-customers and the 2023 report is the first one that shows how the indicators have evolved.

4.2 Retirement products

In relation to BanSabadell Pensiones, over the years it has taken several actions to promote the development of socially responsible investment among pension plans, and it was one of the first institutions to offer a pension plan that invests in ethical projects and charitable assistance, which in addition to investing with socially responsible criteria, makes donations to finance the chosen projects. In 2018, BanSabadell Pensiones, together with Banco Sabadell and trade union Comisiones Obreras, signed an agreement regarding the Socially Responsible Investment (SRI) clause to include it in the statements of investment principles of institutions for occupational retirement provision. BanSabadell Pensiones currently manages nine pension funds that explicitly incorporate a Socially Responsible Investment (SRI) mandate in their investment policy, with assets of 1,006.1 million euros as at 2024 year-end.

In terms of the integration of sustainability risks in the investment decisions of Sabadell Seguros, the asset management process includes quantitative and qualitative ESG criteria. To this end, ESG ratings issued by specialised ESG rating agencies are used. These allow the risks and opportunities associated with short- and

¹⁰ Article 8 of Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainabilityrelated disclosures in the financial services sector (known as SFDR), which governs transparency of the promotion of environmental or social characteristics in pre-contractual disclosures and transparency of sustainable investments in pre-contractual disclosures, respectively

¹¹ Articles 8 and 9 of Regulation (EU) 2019/2088 of the European Parliament and of the Council

long-term investments to be identified. Certain tools are also used in the process that detect reputational alerts related to the companies and assets that form part of its investments. In addition, it is worth noting that exclusion policies are applied, meaning that it does not invest in controversial sectors (weapons, thermal coal, etc.). To analyse sustainability risk controls in investment portfolios, the ESG Footprint Committee was created, which is responsible for supervising sustainability risks and verifying the correct implementation of the sustainability risk policy by each investment manager.

4.3 Insurance products

Sabadell Seguros has been a participant of the Q-Impact fund since July 2021, in order to contribute to the global challenge of energy transition and create professional opportunities for vulnerable groups.

Q-Impact invests in companies in growth or expansion stages that mitigate issues linked both to social inclusion and to the green transition in Spain. In the social sphere, the fund focuses primarily on companies that help young people to find employment, those that reduce unemployment among young people, those that work to improve the inclusion of people with functional diversity and vulnerable groups, and those that improve the lives of people with functional diversity and the elderly through adapted products and remote assistance services. In relation to the green transition, the fund focuses on acting as a catalyst for investment in underserved markets, as well as focusing on organic agriculture, sustainable technology and related sectors, such as the generation of renewable energy on islands and the financing of self-consumption and energy efficiency.

As at September 2024, the Q-Impact fund had obtained the following results: in its financial valuation, it reached an Internal Rate of Return (IRR) of 16.6%; as for its social and environmental impact, since Q-Impact became involved with each company, the investment-weighted impact metrics recorded 81% growth as at 30 September 2024.

In terms of protection insurance, the aim of companies is to promote the development of products and services that create social value and foster environmental protection.

Similarly, the Bank wants to offer insurance products that help it to deliver on its commitment and fulfil its responsibility to the environment. For that reason, a number of its products include services and benefits that promote the fight against climate change.

Its home insurance products also take into account the needs of customers concerned about climate change, offering coverage for accidental breakages of the sheets of glass of any solar panels that they have installed and which are fixed to the fabric of the building of their homes and for their exclusive use. Any charging points for electric vehicles installed and fixed in their (owned) garage are also considered part of the fabric of the building.

On the other hand, the vehicle insurance product offers special coverage for electric vehicles, such as roadside assistance in the event of a breakdown, accident or low battery; coverage for the theft of the charging cable or plug; as well as coverage for damages to third parties caused by faults when charging the vehicle (with the Civil Liability coverage).

Similarly, travel has become less frequent, consequently reducing greenhouse gas emissions, thanks to video valuations in Vehicle Protection and Home Protection insurance and 24-hour video consultations in Health Protection provided by Sanitas.

5. Issuance of Banco Sabadell sustainability instruments

In 2024, Banco Sabadell updated its Framework for the issuance of instruments linked to Sustainable Development Goals (SDGs), which serves as the reference document for the issuance of green, social and sustainability instruments, in different formats, including public and private issues. The Framework applies the substantial contribution criteria proposed in the EU Taxonomy for the defined categories of green eligible projects and complies with the voluntary guidelines of the International Capital Market Association (ICMA).

• Green instruments are intended to finance eligible green project categories, focusing on projects with environmental benefits, such as reduction of greenhouse gas emissions, pollution prevention and climate change adaptation.

• Social instruments are designed to finance eligible social project categories, focusing on the generation of social benefits by providing access to essential services, facilitating social inclusion and promoting the generation and maintenance of employment.
• Sustainability instruments are aimed at providing finance for a combination of green and social activities, as described above.

The net proceeds obtained by issuing these types of instruments (or the amount of the collateralised financial guarantees, where applicable) are used to finance or refinance all or part of the new or existing loans or projects that meet the eligibility criteria established in the Framework.

In 2024, Banco Sabadell issued two green bond deals amounting to a total of 1 billion euros. Specifically, on 13 March 2024, it issued one €500m 6.5NC5.5yr green senior non-preferred debt deal. On 27 November 2024, it issued one €500m 6.5NC5.5yr green senior non-preferred debt deal. With these deals issued in 2024, Banco Sabadell now has nine outstanding green bond deals amounting to a total of 4,445 million euros. In addition, on 21 June 2024, the first green synthetic securitisation was carried out on a project finance portfolio of 1.1 billion euros, with a commitment to reinvest 110 million euros in eligible green projects, corresponding to the tranche placed with third parties.

Based on that provided in the Framework, a report was prepared, for the green bonds issued in 2022 and 2023, on the allocation of proceeds to eligible projects and the environmental impact generated by those projects. The report was reviewed by an independent expert. The report is available on the corporate website under the heading Green Bonds Report 2024, alongside the reports for previous years.

6. Sinia Renovables

As at 2024 year-end, Sinia Renovables, Banco Sabadell's division for investment in renewable energies and sustainability, has investments in projects under development, construction or in operation, increasing its activity by 20% compared to 2023 with an overall installed capacity of 1,645 MW, equivalent to the electricity consumption of about 1,164,577 households. Of this capacity, the portion attributable to Sinia through its direct shareholding is 271 MW, equivalent to the generation of 619 GWh of sustainable electricity every year. This generation, if all projects were in operation, would be equivalent to preventing the emission of 86,700 tonnes of CO2 per year to satisfy the average annual consumption of around 189,267 households¹² .

Thee years ago, Sinia launched its Alternative Green Equity Solution, which is a hybrid financial product that offers solutions to real estate developers with limited ability to obtain funding. They have good renewable energy projects that are almost Ready to Build but they are ultimately unable to complete construction and so they become Independent Power Producers (IPPs). In 2024, Sinia Renovables mobilised more than 37.7 million euros, between invested capital and financing.

These figures position the Group as one of the leaders of the financial sector when it comes to investing in renewable energy and sustainability projects, backed by its 25 years of activity in the sector.

Details of the main achievements of Sinia Renovables as at the end of the year are given here below:

• Developers helping developers: the development of projects in the development phase (55% of Sinia's portfolio is in this phase) has increased by over 10% year-on-year. This is because Sinia has a multidisciplinary team specialised in finance, management and engineering for this type of asset.
• In Spain, Sinia is active in 13 of the 19 autonomous communities, combining knowledge about each of their unique social, economic, environmental and regulatory characteristics.
• International locations represent 21% of the power held in the portfolio: Sinia has sizeable investments in wind power projects in Mexico equivalent to 216.9 MW in operation in the region of Tamaulipas and it is developing a large photovoltaic power plant in its central region. In France, it is co-investing in the development of a 15.4 MW wind power plant.

¹² Conversion factor calculated based on data from the Spanish Office for National Statistics (Instituto Nacional de Estadística or INE)

• Active in biomethane: in 2023, Sinia consolidated other courses of action in environmental sustainability through the completion of biomethane production projects from food sector waste, such as its investment of 7.75 million euros in Catalana de Biogás.
• Stakes in specialised sustainability holdings: one example of this is the minority interest held by Sinia in Soluciones y Desarrollos de Ingeniería y Servicios (Sydis), which has almost doubled its portfolio to 242 MW distributed across 52 projects. Another example is the support provided to long-standing Spanish developers such as Energías Renovables del Bierzo (Erbi), with a new capital co-investment in two cutting-edge wind power projects with almost 100 MW capacity and with which Sinia has enjoyed a successful relationship for over 20 years.
• In 2024, it is worth mentioning Sinia's stake, with a share of 49%, together with Conecta2, in Spain's largest industrial self-consumption power plant at the SEAT facilities in Barcelona and Martorell, with a set of projects that come to a total of 26.4 MWp financed through project finance.

7. Green financing and lines of credit with multilateral development banks in Mexico

7.1 Green financing

In 2024, Banco Sabadell Mexico granted green financing in the amount of approximately €135m.

The destinations of the funds mainly included:

• Installation of renewable energy technology
• Construction and installation of infrastructure for the management of wastewater
• Improvements in companies' processes to reduce their consumption of energy from non-renewable sources
• Reduction of scope 1 and 2 emissions intensity per m² of built area in hotel assets (tCO2e/m² )
• Reduction of consumption of drinking water per m² of built area in hotel assets (m³ of water/m² )

In addition, work on the environmental and social analysis continues, to reduce financing to the following sectors that have a particularly negative impact on the environment: Mining, Energy, Agro-industry, Infrastructures and Defence.

7.2 Lines of credit with multilateral development banks

Since 2019, Banco Sabadell Mexico has had access to a 10-year line of credit of US\$100m granted by the International Finance Corporation (IFC), a member of the World Bank Group, to promote the development of sustainable tourism and construction in Mexico. These funds are granted to customers seeking to promote the development of sustainable projects.

Banco Sabadell Mexico also has an 8-year credit facility in the amount of \$50m with the German Development Finance Institution (DEG, by its German acronym).

As part of the agreements with the IFC and the DEG, Banco Sabadell Mexico prepares and submits to them an Annual Report on Environmental and Social Performance, which describes the implementation and operation of its Environmental and Social Risk Management System, as well as the environmental and social performance of customers to whom this system was applied in the previous tax year.

Since 2021, all infrastructure projects (new builds and extensions), as well as any hotel-related operation that has received finance of \$5m or more, are evaluated in order to identify their environmental and social impacts and risks. At the end of these evaluations, an Action Plan is drawn up designed to help mitigate the identified impacts and risks, which the customer undertakes to carry out.

During 2024, 20 transactions were evaluated, encompassing the following sectors: Agro-industry, Real estate, Hotels, and Energy.

3.2 SBM-2: Interests and views of stakeholders

Banco Sabadell Group is firmly committed to ensuring sustainability across all its dimensions and, as a financial institution, it is aware of the important role that it plays in its economic, social and environmental surroundings, fostering care for the environment, supporting social progress and upholding a model of good governance, aligned with international best practice.

The Group, in keeping with its commitment, has been conducting materiality assessments of topics related to sustainability, aligning with best practice in relation to sustainability and transparency. Specifically, in 2022, the double materiality approach was included for the first time and the concept of impact included in the 2021 review of GRI standards was introduced.

In line with this development and with the entry into force of the new European Corporate Sustainability Reporting Directive (CSRD), a new double materiality exercise has been carried out in order to identify the material impacts, risks and opportunities related to sustainability. To that end, the guidelines set out in the European Sustainability Reporting Standards (ESRS) created by the European Financial Reporting Advisory Group (EFRAG) and adopted by the European Commission have been taken into account. This analysis, as established in the aforesaid standards, serves as a basis for determining the Institution's material topics and, consequently, those that should be included in the Group's Sustainability Report. Under the double materiality approach, this exercise includes assessing the effect of different sustainability topics from two points of view:

• 1. Impact materiality: referring to the Bank's effects on the environment and society through its activities, both directly and indirectly.
• 1. Financial materiality: referring to the effects of the environment and society on the Bank's financial position.

Methodological phases:

The methodological performance of the double materiality analysis carried out comprises four key phases:

• 1. Definition of the perimeter under analysis
• 1. Impact materiality assessment
• 1. Financial materiality assessment
• 1. Definition of materiality thresholds

The first phase of the process is described below, as the following three phases are described in section 4.1 Double materiality, which meets the requirements of "IRO-1: Description of the processes to identify and assess material impacts, risks and opportunities".

Definition of the perimeter under analysis:

The aim of this first phase is to outline the Double Materiality analytical framework. This phase involved determining:

a. The key sustainability topics for the Institution:

To identify the possible material topics to be evaluated in the double materiality exercise, an analysis was carried out to identify those topics that are, in principle, more important for the Institution from an ESG perspective.

In this respect, the topics referred to in the ESRS were comprehensively analysed, in addition to the topics deemed to be material in previous materiality exercises and the Principles for Responsible Banking¹³, among others.

¹³ Results obtained from the Portfolio Impact Analysis

Based on these priority topics, a process then took place to rule out or discard the less material topics, applying expert criteria, merging those with synergies between them and keeping those that were thought to have priority. To perform this discarding process, the following analyses were taken into consideration: (i) other regulatory references and questionnaires from ESG rating agencies, (ii) analyses of other stakeholder groups (internal information about the opinions of investors, customers and NGOs), and (iii) comparative analyses of the sector's ESG disclosures.

b. Stakeholder groups to be involved in the exercise and definition of channels to listen to what they have to say:

The Bank's main stakeholder groups were identified by reviewing previous exercises, analysing recommendations included in the CSRD, and analysing peer group entities. The groups identified for the double materiality exercise were the following:

• Financial Community: investors, shareholders and rating agencies
• Employees: Banco Sabadell Group workforce
• Suppliers: main suppliers that might be more affected by ESG topics
• Customers: retail and business customers
• Bodies and Institutions: regulators of the domestic and European framework
• Society: citizens, communities and organised civil society
• Peers: comparable institutions in the sector

After identifying the stakeholder groups, channels to listen to what they had to say were determined. To that end, priority was given to direct contact and, where that was not possible, indirect contacts were made by analysing the documentation related to the corresponding stakeholder group.

In the case of suppliers, employees, retail banking customers and business banking customers, questionnaires were sent out through surveys in order to ascertain their opinions about the topics under consideration. To determine the number of responses needed to be considered statistically significant, the smallest representative sample of each sample universe was calculated to estimate how many surveys needed to be sent, considering a confidence interval of 95%.

In the case of the Financial Community, Bodies and Institutions, Society, and Peers, the Group's internal documentation was used, as well as reports and public documents to complement the analysis.

For the General Management stakeholder subgroup, a total of 20 interviews were held with managers from different areas of the Bank. It is worth noting that the managers considered in the sample came from a wide range of units, so most of the areas of the Bank were taken into consideration.

The way in which the Institution's strategy has embedded material topics for its stakeholder groups is described in detail in the sections included for that purpose in the material disclosures:

• 5.1.3. Strategy (in relation to climate change), particularly in relation to finance for projects that promote the transition, the reduction and offsetting of the Institution's carbon footprint, support for the transition for GHG emissions-intensive sectors, and the management of physical and transition risks, among other topics.
• 5.2.2. Strategy (in relation to own workforce), specifically in relation to managing the gender pay gap, staff development, competitive salaries and the quality of life of employees.
• 5.3.2. Strategy (in relation to consumers and end-users), particularly in relation to finance for housing, the contribution to a robust business fabric, the management of customer vulnerability, customer satisfaction, digitalisation, and cybersecurity.
• • 5.4.2. Strategy (in relation to business conduct), particularly in relation to contributions to the stability of the financial system and the trust of investors and customers through ethical and transparent conduct.
• 5.5. Entity-specific disclosures: Tax responsibility, in particular in relation to the Bank's contribution to the development of the companies in which it operates.

The results of the double materiality analysis, as well as the process and methodology applied, were reported to the Sustainability Committee, the Management Committee and to the Board Audit and Control Committee of the Institution. The double materiality analysis also underwent an ESRS readiness audit carried out by the Bank's third line of defence in 2024.

3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

As a result of the double materiality exercise, the following material impacts, risks and opportunities have been identified:

Sustainability topic	Material impacts Value chain
Climate change	Reduction of the effects of climate change through the provision of finance for projects that promote the reduction of greenhouse gas emissions and/or the capture of CO2.	Downstream
	Contribution to reducing global warming due to the Institution's goal to have carbon neutral operations.	Own operations
	Contribution to a more sustainable economy by consuming electricity from renewable sources.	Own operations
	Granting of finance to companies involved in GHG emissions-intensive industries and which have no plans to transition to a sustainable economy, which contributes to global warming.	Downstream
	Contribution to the mitigation of the effects of climate change through digital management of services, such as encouraging the use of digital channels in order to avoid customers having to travel to branches, promoting teleworking by employees, and optimising the transportation of office materials (e.g. paper, plastic).	Own operations
Own workforce	Existence of a pay gap due to insufficient development of initiatives to promote gender equality.	Own operations
	Professional development of the workforce thanks to the implementation of a training plan.	Own operations
	Establishment of competitive salaries for people in the organisation.	Own operations
	Improvement in the quality of life of the workforce thanks to the implementation of fair working hours, a safe work environment and the development of work-life balance policies.	Own operations
Social inclusion of consumers and end	Improvements in the economic, social and cultural rights of communities by offering finance so that they may access housing.	Downstream
users	Contribution to a robust business fabric, by offering finance to startups and SMEs in the geographies in which the Bank operates.	Downstream
	Access for vulnerable groups in society to basic financial services, fostering equality and reducing the economic divide.	Downstream
	Negative impact on the finances of vulnerable groups due to their over-indebtedness, as a result of taking out certain financial products that are not suited to their profiles.	Downstream
Ethics, integrity and good corporate	Improved levels of customer trust thanks to the Bank's ethical and transparent conduct.	Own operations
governance	Contribution to the stability of the financial system, by exercising good corporate governance, taking ethical actions that benefit society and other players.	Own operations
	Improved levels of confidence among investors, shareholders and the market in general, due to transparent disclosure of the Institution's financial and non-financial information.	Own operations
Tax responsibility	Tax contribution to the economic development and sustainable growth of all jurisdictions in which the Group operates, adjusting the fiscal approach accordingly, continuously promoting responsible and transparent tax management, in accordance with the concerns and requirements of its customers, shareholders, tax authorities and other stakeholder groups.	Own operations

Sustainability topic	Material risks and opportunities
Climate change	Opportunity to build customer loyalty by offering advisory services for the climate transition.	Downstream
	Opportunity to improve the position in the market by offering sustainable finance solutions (green & social loans and sustainability-linked loans).
	Credit risk for the Institution caused by physical climate risks affecting its customers, ultimately reducing their creditworthiness.
	Risk of a loss of business and higher costs for customers who fail to transition.
Customer satisfaction	Opportunity to increase turnover by cross-selling financial products.	Downstream
Social inclusion of consumers and end users	Risk of increased costs to adapt solutions for vulnerable groups.	Downstream
Privacy and cybersecurity	Risk of higher costs and investments in cybersecurity to tackle increasingly sophisticated attacks.	Own operations
Digitalisation	Opportunity to increase income by attracting new customers through digital channels.	Own operations
	Risk of digital fraud for the Bank.	Own operations

Double materiality analysis results

The table below shows the results of the double materiality analysis, indicating the sustainability topics analysed (ESRS) with their relative weight or importance in terms of materiality.

ESRS			Impact materiality		Financial materiality			Double materiality
			Impact	Risk		Opportunity			Result
ESRS E1 - Climate change
ESRS E2 - Pollution
ESRS E3 - Water and marine resources
ESRS E4 - Biodiversity and ecosystems
ESRS E5 - Circular economy
ESRS S1 - Own workforce
ESRS S2 - Workers in the value chain
ESRS S3 - Affected communities
ESRS S4 - Consumers and end-users
ESRS G1 - Business conduct
Tax responsibility14
Scale	Very significant	Significant		Material		Non-material

Following the analysis, Banco Sabadell concluded that the current risks identified in the double materiality analysis (which include the risk of digital fraud, higher costs to adapt solutions to vulnerable groups and credit risk caused by the physical climate risks to which customers are exposed and which reduce their creditworthiness) currently product no significant effects.

This conclusion was reached after evaluating the impact that they currently have on the Bank's financial statements, such as the income statement and the balance sheet, having verified that they have no material significance. Assuming that these impacts may be following a growing trend, risks are being managed in order to minimise the potential extent of those impacts in the future.

In relation to current opportunities, including those related to a wider offer of sustainable finance solutions and improved advice for the climate transition, as well as those related to the opportunity to attract new customers through digital channels and increased cross-selling, it was concluded that they have material significance and

¹⁴ Sustainability matter specific to the Institution and not covered by any of the topical ESRS

the Institution is working to benefit from them and to continue developing the sustainable solutions that it offers to its customers.

Thus, the Bank committed to mobilise €65bn in sustainable finance between 2021 and 2025. Up to December 2024, more than €57.9bn had been mobilised, €19bn of them during this year.

As a result of the digitalisation strategy pursued by the Institution, over 150,000 customers were onboarded digitally in 2024 and this figure is expected to continue rising in the coming years, making it an increasingly significant source of income.

Specific qualitative analysis of the financial materiality of environmental risks:

Every year, the Institution reviews the impact materiality assessment of environmental risks (physical and transition risks stemming from climate change and environmental degradation), identifying all possible factors that can transmit these risks, evaluating them according to a scale of impact intensity and taking different time horizons into account. This exercise takes place for all of the main risks included in the Global Risk Framework considered to be directly impacted by environmental risk. Specifically, credit, market, liquidity and operational risks are considered, as it is thought that in other risks (such reputational risk and business model risk), the effect is indirect as it stems from the impact and management of the four risks mentioned.

The exercise is based on recent developments and the main trends observed in the past year in relation to climate and the environment, which may be consolidated, become more pronounced, or impact the Institution, either now or in the future. In keeping with that overview, a qualitative assessment is made of the impact of physical and transition risks on both customers/counterparties and on the Bank, based on an impact intensity scale that goes from low to high and taking into account different time horizons. These time horizons (short term: 1-3 years, medium term: 4-5 years, long term: >5 years) are based on the expectations established by the supervisory body in the Guide on climate-related and environmental risks, which sets out supervisory expectations regarding risk management and disclosure and was published by the ECB in November 2020.

This way, the qualitative materiality assessment, which is updated every year, seeks to characterise the way in which environmental risks affect the Institution over different forward-looking time periods (affecting either its balance sheet or its own operations), and to determine how intense the impact could be on the traditional bank risks in which environmental risks could materialise. It is also the starting point used for other analyses carried out by the Bank throughout the year, such as the annual quantitative materiality assessment of environmental risk in the main bank risks (credit, market, liquidity and operational risks).

The areas responsible for managing each of those risks take part in conducting this assessment. Those areas identify and evaluate the potential impact of each risk based on a questionnaire regarding the transmission channels through which different types of environmental risk factors may materialise. These types, which are based on the classification provided in the climate disclosure guidelines issued by the Task Force on Climaterelated Financial Disclosures (TCFD) and in the current disclosure requirements of the Corporate Sustainability Reporting Directive (CSRD), relate to physical risk factors (acute or chronic) and transition risk factors (policy & legal, technology, market, or reputational risks).

The qualitative materiality analysis for 2024 was based on the trends observed over the year and showed that, from the perspective of physical risks, in 2024 acute climate events continued to occur and chronic climate trends continued to get worse (water stress, flooding, record temperatures, etc.), in keeping with previous years. There is therefore a noticeable "tropicalisation" of the climate and a consolidation of more variable patterns. The fact that global greenhouse gas emissions are still at an all-time high makes it more likely that disorderly transition or inactio (Hot House World) scenarios materialise, which are associated, particularly in the latter case, with a more frequent and severe occurrence of acute and chronic physical risks. In terms of transition risks, on the other hand, the trends analysed showed that these remained stable compared to 2023, with a certain decrease of regulatory transition risks as society and politicians increasingly question climate action (which could slow or scale down the green agenda going forward) and, at the same time, as there is increasing awareness of the reputational transition risks stemming from the risks of liability and environmental legal action.

The results of the analysis showed that, in terms of inherent risk, the risk with the biggest effect continued to be credit risk (see table).

• In terms of physical risks, as events are expected to become more frequent and severe, it is thought that this will increase the impact intensity of credit risk over the time horizon considered. In 2024, the short- and medium-term assessment of chronic physical risk was revised (going from non-material to low in both cases). In terms of transition risks, these are estimated to have a gradually increasing overall impact on counterparties (customers), affecting them to a greater or lesser extent depending on their activity sector and the efforts made to decarbonise.

On the other hand, for the other risks analysed (market, liquidity and operational), the impact intensity of inherent environmental risks is low:

• In terms of market risk, investors are not yet clearly pricing these types of risk factors into the prices of financial assets (particularly sovereign debt, where the Bank has most of its market risk), nor have they yet changed their general requirements to require issuers to submit plans for their transition to Net Zero that show their trajectory towards a decarbonised economy.
• As for liquidity risk, the low impact is due to the fact that the risk inherent in the Bank's customers is expected to be isolated or localised in specific sectors and locations. In 2024, the medium-term impact of chronic physical risk was revised upwards (from non-material to low), in keeping with the credit risk assessment.
• In operational risk, the impact is low. In terms of physical risks, extreme weather events currently have an isolated and uneven effect on the region. As regards transition risks, the new regulations on sustainable financial products are still in the process of being developed and implemented.

		Short term		Medium term		Long term
	PHYSICAL RISK
Credit
Market
Liquidity
Operational
	TRANSITION RISK
Credit
Market
Liquidity
Operational
No impact	Low	Medium-low	Medium	Medium-high	High

Inherent risk results of the 2024 qualitative environmental risk assessment

These results refer, in all cases, to the inherent risk assessment, without considering the controls implemented or the application of the mitigating factors that the Institution has in place or which are in the process of being implemented under the Sustainable Finance Plan (SFP), or any of the internal policies aimed at ensuring that each risk is correctly identified, prevented or remediated. These mitigation factors include, as an illustration and from the point of view of credit risk, the estimation of transition and physical risk models for corporate counterparties and mortgages, the analysis of counterparties, and the implementation and monitoring of sectoral decarbonisation pathways. From the point of view of factors that mitigate liquidity risk, it is worth noting the adequacy of the existing liquidity buffers, and in relation to operational risk, it is worth mentioning the Institution's operational continuity plans, the insurance policies it has signed the possibility of staff to work from home.

After considering the rollout of mitigating factors and the initiatives of the Institution's Sustainable Finance Plan, the residual environmental risk is concluded to be low for all of the risks under analysis.

Double materiality analysis evolution

During 2024, the double materiality analysis that was conducted in 2022 was updated. That update mainly consisted of bringing the framework of ESG topics and the methodology in line with the requirements and indications of the ESRS.

As a result, the matrix published in the previous year underwent some changes in terms of the prioritisation of certain topics, considering the ESRS in the methodology, as well as the increasing importance of ESG topics for the Bank's stakeholder groups.

4. Impacts, risks and opportunities management

4.1. Double materiality (IRO-1, IRO-2 and SBM-3)

Identification and assessment of impact materiality

The double materiality analysis identified the main positive and negative impacts related to each sustainabilityrelated topic that the Bank has or could have on society and the environment. Each of them are assessed according to their characteristics through the scale, scope, irremediable character and likelihood, the scale being the severity or benefit of the impacts on the environment and society, as well as the time horizon of potential negative impacts. In the case of a potential negative impact assessed as impacting human rights, severity prevails over likelihood.

During the assessment exercise carried out, 1,612 participants, broken down according to the chart below, were actively involved through ad hoc questionnaires and interviews with General Management:

The Bank's General Management has been involved in both the assessment of impact materiality (scale, irremediable character and likelihood, since the scope of the impact is set by means of an internal analysis) and of financial materiality (financial effects, likelihood and trend over time). On the other hand, retail customers, business customers, employees and suppliers took part in the impact materiality assessment through an analysis of the scale.

In that regard, 56 impacts were identified, which were assessed under the impact materiality perspective.

Identification and assessment of financial materiality

First, the main risks and opportunities of each sustainability-related topic that affects or could affect the Bank's financial statements were identified. These risks and opportunities were assessed in the short, medium and long term through their financial effects and likelihood of occurrence.

This assessment identified 42 risks and 21 ESG opportunities, which were assessed under the financial materiality perspective.

Definition of materiality thresholds and results

Based on the chart analysis of the normal distribution of the results obtained in the assessments of impact materiality and financial materiality, the Impacts, Risks and Opportunities (IROs) that stand out from the entire sample have been identified. The IROs belonging to the group of scores that are above the rest are classified as "material impacts, risks and opportunities".

Disclosure requirements addressed in the Sustainability Report

Once the material topics for the Bank have been identified, the sustainability information that is to be disclosed in the annual Sustainability Report is structured. Based on these material topics and the structure of the European Sustainability Reporting Standards (ESRS), this report covers environmental information first, followed by information on social aspects to finally conclude with information related to governance. Thus, the structure of the Sustainability Report follows the table of contents set out below:

Topical standard	Disclosure requirement	Page
ESRS E1 - Climate change	ESRS 2 GOV-3: Integration of sustainability-related performance in incentive schemes
	E1-1: Transition plan for climate change mitigation
	ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	426
	ESRS 2 IRO-1: Description of the processes to identify and assess material climate related impacts, risks and opportunities	428
	E1-2: Policies related to climate change mitigation and adaptation	438
	E1-3: Actions and resources in relation to climate change policies	441
	E1-4: Targets related to climate change mitigation and adaptation	448
	E1-5: Energy consumption and mix	453
	E1-6: Gross Scopes 1, 2, 3 and Total GHG emissions	455
	E1-7: GHG removals and GHG mitigation projects financed through carbon credits	459
	E1-8: Internal carbon pricing scheme	460
ESRS S1 - Own workforce	ESRS 2 SBM-2: Interests and views of stakeholders	462
	ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	462
	S1-1: Policies related to own workforce	463
	S1-2: Processes for engaging with own workers and workers' representatives about impacts	466
	S1-3: Processes to remediate negative impacts and channels for own workers to raise concerns	467
	S1-4: Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions	472
	S1-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	478
	S1-6: Characteristics of the undertaking's employees	480
	S1-8: Collective bargaining coverage and social dialogue	483
	S1-10: Adequate wages	484
	S1-13: Training and skills development	484
	S1-14: Health and safety metrics	485
	S1-15: Work-life balance metrics	487
	S1-16: Compensation metrics (pay gap and total compensation)	487
	S1-17: Incidents, complaints and severe human rights impacts	492

ESRS S4 - Consumers and	ESRS 2 SBM-2: Interests and views of stakeholders	493
end-users	ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model
	S4-1: Policies related to consumers and end-users	501
	S4-2: Processes for engaging with consumers and end-users about impacts	504
	S4-3: Processes to remediate negative impacts and channels for consumers and end-users to raise concerns	505
	S4-4: Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions	508
	S4-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	513
ESRS G1 - Business conduct	ESRS GOV-1: The role of the administrative, management and supervisory bodies	515
	ESRS 2 IRO-1: Description of the processes to identify and assess material impacts, risks and opportunities	515
	G1-1: Corporate culture and business conduct policies and corporate culture	515
	G1-2: Management of relationships with suppliers	522
	G1-3: Prevention and detection of corruption and bribery	525
	G1-4: Confirmed incidents of corruption or bribery	525
Entity-specific disclosures	Tax responsibility	526

Internal control processes for the double materiality analysis

As described in section "2.5 GOV-5. Risk management and internal controls over sustainability reporting", the Internal Controls over Sustainability Reporting (ICSR) unit identified risks and designed controls over the new double materiality exercise in order to ensure the correct execution of this exercise and its completeness.

The Board of Directors delegates the supervisory function regarding the internal control systems to the Board Audit and Control Committee. Every six months, the current situation of the ICSR as a result of new applicable regulatory requirements is reported to the Board Audit and Control Committee and to the Technical Committee on Accounting and Financial Disclosures. In addition, every year at the end of the tax year, the result of the assessment of the controls and the conclusions derived from it are escalated to the Board Audit and Control Committee.

Assessment of environmental degradation, social and governance risks

In addition to climate risk, understood as the climate-related physical and transition risks that are material for the Institution and its governance, strategy and management arrangements, as described in subsection "5.1. Environmental: Climate Change" according to ESRS E1 - Climate change, the Institution assesses and monitors environmental degradation, social and governance risks. The processes through which they are integrated in the Institution's risk management model are described below.

The Institution, through its own operations, does not cause any negative impacts worthy of mention in the areas of biodiversity, ecosystems or natural resources. Furthermore, its stock of physical assets, which includes, among others, corporate buildings, offices, other facilities and ATMs, is located in urban hubs, away from ecosystems and biodiversity-sensitive areas.

The quantitative assessment of environmental risk materiality that the Institution carries out regularly considers that banking activity has a "Low" impact on the various vectors (air, soil, biodiversity and water) and a very limited impact on waste. This analysis is based on the sector mapping tool of the United Nations Environment Programme Finance Initiative (UNEP FI), which quantifies the impact on the environment of a banking institution (according to its NACE code) and which the Institution also uses to assess the Environmental Degradation Risk (EDR) of its loan book.

The lack of noteworthy impacts in these areas is reinforced by the Bank's Environmental Management System (EMS) certification in accordance with ISO 14001:2015, which includes annual audits describing and analysing the plan of initiatives or improvements in relation to the EMS and covering aspects such as environmental performance, energy performance, waste reduction, disposal of hazardous materials, etc.

However, the Institution is exposed to potential non-climate-related environmental risks through its suppliers that deliver goods and services to the Bank. These are players located in its upstream value chain. Therefore, and in order to identify, manage and, where appropriate, minimise these potential risks, the Institution has several policies and procedures in place, such as the Procurement Policy, the Policy on the Outsourcing of Functions, and the Supplier Code of Conduct. Together, these documents describe the entire supplier relationship process, from the prior assessment, accreditation and procurement phase through to service delivery and its management and oversight. Throughout this entire service outsourcing and supplier management process, the Group has included the sustainability principle in its outsourcing and procurement policies to ensure that suppliers apply the best ESG practices and to incentivise this conduct.

Moreover, the Institution carries out an assessment of the various environmental aspects with tools that provide relevant information to decide whether or not to engage certain suppliers, through questionnaires based on the "statement of responsibility" of the supplier, who states their acceptance of various statements in relation to each aspect. By way of example and for illustrative purposes only:

• General ESG: whether the supplier has an EMS or a publicly disclosed environmental policy, whether it has received complaints of an environmental nature, whether it identifies and manages ESG aspects and risks, whether it adheres to various environmental initiatives or commitments, whether it prepares an annual and public sustainability/CSR report, whether it has a sustainable procurement policy and if this policy is applied to its value chain, etc.
• Biodiversity and climate: whether it promotes actions that minimise the impact on biodiversity, whether it identifies and assesses climate risks, whether it complies with legal requirements on environmental matters, etc.
• Waste and circularity: whether it quantifies its waste and has improvement objectives, whether it has a circularity strategy for its activities, whether it integrates circularity criteria in its decisions or whether it takes actions to reduce the use of materials in the manufacturing of its products and services (metals, minerals, plastics, etc.).
• Water resources: whether it calculates a water footprint indicator in its production process and carries out regular monitoring of water consumption, whether it has targets for reducing water consumption, whether it carries out a water risk assessment, etc.

This analysis is carried out for various types of suppliers (essential outsourcing, non-essential outsourcing and critical outsourcing). Afterwards, they must satisfactorily complete the accreditation process and undergo continuous monitoring by the Institution of their contract compliance.

Thus, the Institution focuses its attention on the sustainability and environmental resilience of its suppliers and has outlined a dual objective for 2025 to prevent and adequately manage environmental risk and to minimise possible negative effects (and amplify the positive ones) that these suppliers may generate. These objectives are, on one hand, for 80% of its relevant suppliers to have an ESG score and, on the other hand, for 90% of billing with these suppliers to be with those that have the highest scores (A+, A or B). The first objective has already been complied with, and the second objective is on track to be met by the committed date.

Environmental degradation risk of the loan book

The Bank conducts an assessment of its exposure¹⁵ to the risk associated with environmental degradation of the business risk portfolio, based on the United Nations Environment Programme Finance Initiative (UNEP FI) methodology. This methodology assigns an environmental impact to each NACE code, obtained by consolidating these five non-climate-related environmental factors:

• Management of water resources: risk of water resources becoming contaminated, and their management.
• Impact on biodiversity: negative effects on species and natural spaces.
• Pollution and use of land: risk of land becoming contaminated or degraded, as well as the use associated therewith.
• Air quality: risk of air being polluted with gases other than greenhouse gases (GHG), which could potentially affect ecosystems and people's health.
• Management of resources and waste: generation of waste (hazardous or otherwise) in large quantities and with intensive use of natural resources.

It is worth noting that an exhaustive review of the environmental degradation risk associated with each NACE code has been carried out, to obtain more granular data for each activity and to standardise the risk of certain similar activities (e.g. manufacturing activities, transport activities, etc.).

The overall environmental degradation risk score consolidates the risk associated with each of these factors. It is worth noting that, at present, environmental degradation risk (as well as the five factors) is not broken down by drivers (transition and physical). In this way, the impacts on the business portfolio are classified in four risk categories: "Low", "Medium", "High" or "Very High".

1.3% of the business exposure is classified as having "Very High" environmental degradation risk and 10% as "High" risk¹⁶; the portfolio classified as having "High" and "Very High" risk remained stable compared to 2023. At a sectoral level, environmental degradation risk is concentrated in certain sectors, such as Electricity and gas, Transport, Chemical, and Oil extraction, mining & quarrying.

Lastly, to ensure that the measurement of the evolution of these risks is supervised, the portfolio's exposure to climate-related and environmental risk is monitored on a quarterly basis and reported to the Bank's Sustainability Committee¹⁷ .

Biodiversity risk

Biodiversity risk, as a subcategory of environmental degradation risk, affects the financial sector in a similar way as climate risk does, as both have associated ecosystem services that can be translated as an economic value for society. The potential deterioration of these services could affect the economy's production capacity.

The World Economic Forum estimates that over half of the world's GDP, 44 trillion dollars, is potentially at risk as a result of companies' reliance on nature and its services. At the same time, the Living Planet Report 2022, a comprehensive study of trends in global biodiversity and the health of the planet, published by the World Wide Forum (WWF), revealed an average decline of 69% in species populations since 1970. While conservation efforts are helping, urgent action is required if we are to reverse nature loss.

Banco Sabadell's regulatory framework includes different guidelines for the protection of biodiversity. At the top level of this framework is the Group's Sustainability Policy, which includes the main guidelines for social, environmental and governance actions. This document sets out the principle of 'environmental protection', which includes the management of biodiversity.

¹⁵ Exposure means the amount drawn down and contingent risks in the business loan book

¹⁶ Part of the portfolio could in turn also be affected by climate-related transition risk, therefore the percentages of each one cannot be added together directly

¹⁷ Details of the attributions of management bodies in climate-related matters are provided in chapter "2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies"

Based on this policy principle, the Bank defined the Environmental and Social Risk Framework, which also lays down measures to protect biodiversity, either through restrictions of certain activities or through general restrictions.

As the management of climate change and the management of biodiversity are intricately linked, most of these restrictions help to mitigate both risks. However, there are certain exclusions where the Bank has established that it will not take credit risk if it finds sufficient evidence that one or more of the following circumstances associated with biodiversity exist:

General exclusions:

• Companies that pose a threat to UNESCO World Heritage Sites, to any of the wetlands included in the Ramsar list, locations appearing on the map of the Alliance for Zero Extinction, and Category I-IV areas of the International Union for Conservation of Nature.
• Companies for which Banco Sabadell has sufficient reasons to believe that they are in material breach of applicable laws and regulations in relation to human rights and the environment, even if the circumstances in question do not constitute a breach of the local legislation of each country.

Sector-specific exclusions:

• Farms involved in scandals related to the production or trade of products regulated by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).
• Farming projects that involve the burning of natural ecosystems in order to clear land for agricultural activities.
• Farming projects that involve the destruction of High Conservation Value Forests.
• Vessels operating with drift nets of more than 2.5 km in USA or EU waters, or those which use drift nets to capture any of the species listed in Annex VIII of EU Regulation (EC) 1239/98 or those listed in the Mexican National Fishing Charter and Official Standard NOM059-SEMARNAT-2010.
• Bottom trawling in USA or EU waters more than 800 metres below sea level.
• Mountain Top Removal (MTR¹⁸) mining methods.
• Mines that fail to produce evidence of a closure and site recovery plan.
• Mines with tailing dams that are not managed according to the best practices of the industry.
• Mining projects that involve the discharge of tailings into river systems or shallow waters.
• Desalination plants that lack adequate measures to mitigate the impact of the disposal of brine and/or the extraction of seawater.

In addition to establishing restrictions on activities with a high impact on biodiversity, the Bank monitors the impact generated by companies' activities within its loan book. Although these are companies that fulfil the Environmental and Social Risk Framework, due to their activity they could inherently have an impact on biodiversity. This aspect is considered from two points of view:

• 1. The quarterly monitoring of environmental degradation risk: this risk includes biodiversity risk, where it is clear that the sectors to which the Bank has exposure and which have the greatest impact are Electricity, Road transportation, Maritime transportation, Agriculture and fishing, and Oil and gas.
• 1. The classification of borrowers according to the Climate-related and Environmental Risk Indicator (IRCA, by its Spanish acronym) (see heading "Climate-related and environmental performance of the loan book", included in

¹⁸ On an exceptional basis, the Institution may grant them finance where they are located in countries with high energy dependence (more than 65% of imported energy) on coal or where they have no other viable alternative energy sources

section 5.1.4.3. E1-3: Actions and resources in relation to climate change policies). Companies with "High" or "Very High" environmental degradation risk, which includes biodiversity risk, are given a worse rating.

Environmental and Social Risk Framework

As mentioned above in biodiversity risk, this Framework consolidates the set of applicable criteria (sectoral standards) that are intended to limit the financing of customers or projects that the Institution considers to be contrary to the transition to a sustainable economy or that lack alignment with international regulations or best practices in the industry.

The Framework also integrates compliance with the rules and standards at the level of social risk, some sectorspecific (e.g. in the energy and agricultural sectors, special consideration is given to the negative impact they may have on society and local communities), and others of general application, such as the International Labour Organisation (ILO) Conventions and the UN Guiding Principles on Business and Human Rights. In this regard, the Framework has the same thresholds and scopes of application and the same mechanisms for effective implementation as described above, including the dispute screening tool of a recognised external supplier. Specifically, the general exclusions limiting the financing of companies with a high level of social risk, regardless of the sector to which the borrower belongs, are:

• Companies for which Banco Sabadell has sufficient reason to believe that they employ child labour or forced labour, as defined in the ILO conventions, or that have participated in human rights violations and/or that do not follow the principles of the Institution's human rights policy.
• Companies involved in the resettlement of indigenous or vulnerable groups without their free, prior and informed consent, or that otherwise infringe the rights of those groups.
• Companies for which Banco Sabadell has sufficient reasons to believe that they are in material breach of applicable laws and regulations in relation to human rights and the environment, even if the circumstances in question do not constitute a breach of the local legislation of each country.
• Companies that do not have health and safety policies in place to protect their workers, such as OHSAS 18001 or ISO 45001.

The other aspects, beyond social risk, assessed as part of the framework and details of their application and integration in policies are described in subsection "5.1. Environmental: Climate change".

Social risk

The Institution, as part of its assessment of counterparties, not only assesses aspects linked to climate-related and/or environmental risk but also ascribes an important role to the assessment of the social and/or governance risks of counterparties.

Social risk takes into account various social factors such as those related to rights, well-being, and the interests of people and communities. The risk of loss arising from any negative financial impact on counterparties stemming from the current or prospective impacts of social factors is also included.

To that end, a series of actions linked to the process for identifying, measuring and managing social risk for both retail and business customers have been implemented. Although it is true that many of these actions apply to both types of customers, the Due Diligence Policy as regards the granting of credit is geared towards retail customers, while the Defence Sector Policy, the Eligibility Guide and the IRCA are actions mostly aimed at corporates.

Additional aspects assessed as part of the social risk of counterparties

In addition to the Environmental and Social Risk Framework itself, the Institution has strengthened the process for capturing, identifying and reporting the social risk of counterparties during 2024. This process is mainly executed at two different levels:

1. The advanced Climate-related and Environmental Risk Indicator (IRCA, by its Spanish acronym) has a specific module enabled to capture KRIs or quantitative social indicators of counterparties. This makes it possible to capture aspects linked to respect for human rights, quality employment, equality, fair and equitable compensation, talent management, occupational safety, supplier or customer management, among others.

2. During risk acceptance, operations with a Group ORC level of autonomy require an ESG Annex that includes the assessment of potential relevant controversies of the counterparty in relation to social aspects. This is done by assessing potential significant controversies linked to labour disputes (discrimination, labour exploitation, child or forced labour), impact on the community, aspects linked to corruption, bribery, abuse of power or misleading practices, and safety at the workplace.

Lastly, to ensure that the measurement of the evolution of social risks is supervised, the above-mentioned quantitative indicators are monitored on a quarterly basis and reported to the Bank's Sustainability Committee¹⁹ .

Governance risk

The Institution, as part of its assessment of counterparties, not only assesses aspects linked to climate-related and/or environmental risk but also ascribes an important role to the assessment of their governance risks.

In this way, different governance factors of counterparties are considered, such as those related to the management and operation of a company, for example, anti-bribery and anti-corruption practices and compliance with relevant laws and regulations. The risk of loss arising from any negative financial impact on counterparties stemming from the current or prospective impacts of governance factors is also included. Actions in relation to this risk focus on business risk.

Additional aspects assessed as part of the governance risk of counterparties

In addition to the Environmental and Social Risk Framework itself, the Institution has strengthened the process for capturing, identifying and reporting the governance risk of counterparties during 2024. This process is mainly executed at two different levels:

• 1. The advanced Climate-related and Environmental Risk Indicator (IRCA, by its Spanish acronym) has a specific module enabled to capture KRIs or quantitative governance indicators of counterparties. This makes it possible to capture aspects related to the composition of the Board of Directors and the existence of policies on conflict of interests, the whistleblowing channel, tax responsibility, contributions to foundations, among others.
• 1. During risk acceptance, operations with a Group ORC level of autonomy require an ESG Annex that includes the assessment of potential relevant controversies of the counterparty in relation to governance aspects. This is done by assessing potential significant controversies related to bribery, corruption, fraud, accounting manipulation, lack of transparency, succession issues, legal breaches, risk management issues, inclusiveness and conflicts of interest.

Lastly, to ensure that the measurement of the evolution of governance risks is supervised, the above-mentioned quantitative indicators are monitored on a quarterly basis and reported to the Bank's Sustainability Committee.

¹⁹ Details of the attributions of management bodies in climate-related matters are provided in chapter 2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies

5. Material disclosures

Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)

EU Taxonomy

The European Union took a further step as promoter of the energy transformation and the decarbonisation of the economy. In line with the objectives of the fight against climate change, it established the Taxonomy Regulation (Regulation (EU) 2020/852), which was the first step towards obliging firms to disclose the proportion of their activities that are considered green or social, according to this regulation.

This regulation, which establishes requirements for the classification and reporting of sustainable activities, is a key aspect for the integration of ESG aspects into the Group's ordinary activity, as well as being a strategic aspect for the Institution. For this reason, it is regularly monitored by the Technical Risk Committee and the Sustainability Committee.

Banco Sabadell believes it is paramount to ensure that its portfolio is aligned with its decarbonisation targets and, to that end, it has included decarbonisation in its Risk Appetite Framework, in its policies and in its sectoral planning processes, and it has set pathways to achieve those targets.

• More specifically, the Group has a framework for sectoral analysis through internal discussion, the Sector Guidance Strategy (SGS), led together by the Research division and the Risk Management division, and with contributions by sectoral experts from Business, Risk Acceptance, Credit Risk Control and Sustainability. With this, the Group establishes a sectoral strategy based on analysis of the external context of each sector and the internal context. This analysis is cross-checked by the main units involved in the Bank, so that ESG risks are included in the sectoral discussion, together with other macroeconomic parameters. Accordingly, the Group defines its strategic positioning at the subsector level, setting its sectoral asset allocation strategy which is, in turn, incorporated in the financial planning process.
• Furthermore, the Bank has defined certain indicators and metrics in its Risk Appetite Statement (RAS) related to ESG and designed, on one hand, to monitor the status and evolution of physical and transition risks in its credit portfolio and, on the other hand, to establish and limit its risk appetite and/ or position in certain environmental aspects. The RAS indicators include the decarbonisation targets established for 2030 for the sectors with the most intensive greenhouse gas emissions that are financed by the Bank, based on the targets established in the Paris Agreement and aligned with the UNEP FI's NZBA. Information regarding the monitoring of those pathways is included in the Corporate Sustainability Report, which is submitted on a regular basis to the governing bodies.
• Lastly, the Environmental and Social Risk Framework consolidates the set of applicable criteria that aim to limit the financing of customers or projects that are thought to be contrary to the transition to a sustainable economy or to lack alignment with international regulations or best practices in the industry.

On the other hand, since 2020, Banco Sabadell Group has been working on its own Eligibility Guide, based on the EU Taxonomy and the best practices in the market such as the Green Loan Principles and the Social Bond Principles. As this is a key and strategic aspect for the Bank, work has been underway since 2020 to keep the Eligibility Guide and the Sustainable Financing Framework stemming from it aligned with regulatory developments, as well as to implement it in operating systems. The systems implementation was completed in 2024 taking into account the latest delegated acts of the Taxonomy (June 2023).

As a result of this work, the Group's systems currently include a process for tagging priority green products, which allows the entire management cycle of those products to be traced and ensures their alignment with the requirements of the Bank's Eligibility Guide.

In Spain, the tagging of sustainable transactions is carried out through the Eligibility Guide, which is already implemented in the Bank's systems for all segments. Through this Guide, the Bank identifies and requires, for each sustainable purpose, documentation that demonstrates compliance with the substantial contribution criteria in accordance with that set forth in the European Taxonomy. To ensure the gathering of such documentation, automatic and manual controls have been implemented in the acceptance process of sustainable transactions.

In addition, the DNSH criteria and the minimum safeguards are reviewed centrally through the information published by the counterparties.

Thanks to this work, in accordance with the disclosure requirements established by Delegated Regulation (EU) 2021/2178 of the European Commission of 6 July 2021, disclosures for 2024 are set out below.

Key Performance Indicators in the Taxonomy Regulation – Green Asset Ratio (GAR)

Regulation (EU) 2020/852, commonly known as the European Union Taxonomy (hereinafter, the Taxonomy), lays down common harmonised criteria to determine which economic activities qualify as environmentally sustainable. In addition, Article 8 of this Regulation establishes the obligation for any undertaking which is subject to the Non-Financial Reporting Directive (NFRD) to publish information on how and to what extent the undertaking's activities are associated with economic activities that qualify as environmentally sustainable under the Taxonomy. Specifically, for non-financial undertakings, it establishes the requirement that they shall disclose the proportion of their turnover, capital expenditure (CapEx) and operating expenditure (OpEx) derived from this type of activity. In the case of financial institutions, this disclosure obligation translates into a key performance indicator, specifically the Green Asset Ratio (GAR).

The GAR measures the Institution's assets that finance or are invested in economic activities that meet the Taxonomy's technical screening criteria for climate change mitigation and adaptation as a proportion of the total eligible balance (the total balance excludes sovereign exposures, exposures to central banks and the trading book). An activity is deemed to be Taxonomy-aligned where it is an eligible activity, in the sense that it could potentially contribute to one or more of the six environmental objectives set out in the Taxonomy and where, additionally, it meets the following technical screening criteria: it contributes substantially to one or more of the six environmental objectives, the activity does not significantly harm (DNSH) any of the environmental objectives, and the activity is carried out in compliance with the minimum social safeguards (MSS) in relation to human rights. Financial institutions first started disclosing this ratio in 2023.

For an economic activity to be considered eligible, it must feature in the delegated acts developed by the European Taxonomy according to the environmental objective, irrespective of whether that activity does not meet all of the technical screening criteria set forth in those delegated acts or whether it ultimately does not qualify as environmentally sustainable (aligned). There are six environmental objectives: (1) Climate change mitigation, (2) Climate change adaptation, (3) Protection and restoration of biodiversity and ecosystems, (4) Pollution prevention and control, (5) Transition to a circular economy, and (6) Sustainable use and protection of water and marine resources. It is mandatory for financial institutions to disclose finance granted for eligible economic activities in relation to all objectives from 2024 year-end.

The Group determines whether the contribution of the specific finance in question qualifies as substantial according to the technical screening criteria set out in the Taxonomy. The Group is also making every effort to ensure compliance with the DNSH and MSS criteria. Available information and market practices in relation to alignment with DNSH and MSS are constantly changing, making it difficult to provide evidence of its full compliance in accordance with prevailing legislation. That is why the Group, unable to ensure strict compliance with the DNSH and MSS principles, has not included a portion of the finance in the Taxonomy-aligned values in certain cases. In any event, as a new feature this year and to demonstrate compliance with the DNSH principle and that the activity is carried out in accordance with the Minimum Social Safeguards (MSS) for certain exposures, the Group has relied on the information disclosed by the institutions, verifying, for the specific activity financed, compliance with the DNSH principle and the MSS in the Taxonomy tables disclosed by counterparties subject to CSRD.

Moreover, in accordance with Commission Implementing Regulation (EU) 2022/2453 of 30 November 2022, for retail mortgage portfolios, the alignment of these exposures is assessed using a simplified approach based on the high energy efficiency obtained from the corresponding energy performance certificate of the property, without verifying, given the challenges posed, the DNSH principles and compliance with the minimum social safeguards. The Institution selects only those properties with the most efficient Energy Performance Certificate (EPC) ratings, as this is a specific test that is directly related to the underlying exposure. By applying this simplified approach, those properties with the most efficient EPC ratings are deemed to meet the technical substantial contribution criteria. Similarly, for consumer loans for vehicle purchase, the simplified approach is also used based on the vehicle's zero-emissions energy efficiency.

The perimeter used to calculate the GAR, in accordance with Commission Delegated Regulation (EU) 2021/2178, is the prudential scope of the consolidated Group, such that intragroup exposures outside of the prudential scope of consolidation are considered third-party exposures. In addition, the GAR is calculated for the existing stock as at a specific disclosure reference date and also for the flow of new exposures acquired over a 12-month period, which gives an idea of how the Institution is transitioning towards sustainable economic activities and also of how it is helping its counterparties in their transition and adaptation pathway.

The numerator considers the gross carrying amount of the assets aligned with the Taxonomy's environmental objectives concerning climate change mitigation and climate change adaptation; these include loans and advances, debt securities, as well as equity instruments not held for trading or sale, making a distinction between:

• Exposures to financial corporations, including exposures to credit institutions and other financial corporations within the European Union (EU).
• Exposures to (EU) non-financial corporations subject to NFRD disclosure requirements, i.e. with over 500 employees on average during the year, considering, in the case of firms that belong to a group, the number of employees in their corporate group, with a balance sheet of over 25 million euros or turnover above 50 million euros.
• Households, which include home equity loans, building renovation loans and consumer loans for vehicle purchase. In relation to properties, for those that are Taxonomy-aligned, a simplified approach may be followed to measure their contribution to climate change mitigation, assessing the substantial contribution criteria based on the energy efficiency of the underlying collateral. In the case of mortgages granted to retail customers, the Bank's total perimeter is considered, regardless of whether or not the property is located in the EU, and irrespective of whether or not the obligor is a citizen of an EU Member State. Similarly, in the case of consumer loans for vehicle purchase, a simplified approach may also be followed to measure their contribution to the climate change mitigation objective, assessing the substantial contribution criterion based on the energy efficiency of the underlying vehicle.
• Local governments, including finance for public housing and other specialised lending.
• Collateral obtained by taking possession: residential and commercial immovable properties (foreclosed).

In addition, the purpose of the finance granted to the counterparty should be considered, making a distinction between whether the purpose is to finance their general activity or whether the finance is being sought for a specific purpose:

• Finance for generic purposes or for unknown purposes, where exposures are included provided the counterparty's activity is aligned with the economic activities defined in the Taxonomy. This is in turn determined based on the key performance indicators published by the counterparties in relation to their turnover, capital expenditure (CapEx) and operating expenditure (OpEx). Non-financial corporations should have published their key indicators for all environmental objectives with 2023 year-end closing data, while only those relating to climate change mitigation and adaptation objectives needed to be published for the previous year.
• Finance for specific purposes, where exposures are included based on the information provided by the counterparties concerning the project or activities that meet the defined environmental standards and for which the funds will be used.

The denominator considers the gross carrying amount of the Institution's total assets, excluding exposures to central governments and to central banks and the trading book. This way, in addition to the numerator's total exposure, the denominator includes several types of exposures that are excluded from the numerator, such as non-financial corporations not subject to the NFRD and based both inside and outside the EU (the vast majority of SMEs), non-financial corporations and financial corporations based outside the EU, derivatives, interbank deposits, cash and other assets (goodwill, tangible assets, tax assets, etc.). It is important to note that this asymmetrical perimeter between the assets eligible for inclusion in the ratio's numerator and those eligible for its denominator means, in practice, that the GAR is defined as though all exposures not eligible to be considered in the numerator had 0% alignment with the Taxonomy.

On the other hand, it is worth noting that the metric used concerning the gross carrying amount of assets meets the disclosure requirements laid down in the EU Taxonomy, and this results in a difference from the metric used in the accounting records, which corresponds to the net amount of any loss allowance, which is why total assets reflected for such purposes in the GAR are greater than those included in the Group's public balance sheet.

Furthermore, as a previous step to calculating the GAR, Taxonomy-eligible exposures are identified using the following criteria:

• Loans to non-financial corporations/financial institutions: these qualify as eligible or not, according to the known or unknown purpose of the funds. Where the purpose of the finance is known or specific and makes a substantial contribution in accordance with Taxonomy criteria, 100% of the exposure is deemed eligible, and in the case of finance for generic purposes, the publicly-available eligibility information (key performance indicators) of the counterparties is used to determine the eligible exposure.
• Retail mortgage loans: All exposures to individuals secured with a first or second property are deemed eligible, as the purpose of these loans is included within the EU Taxonomy.
• Motor vehicle loans: All vehicle financing exposures are deemed eligible, as this purpose is included within the EU Taxonomy.
• Foreclosed assets: 100% of the exposure is deemed eligible, as this purpose is included within the EU Taxonomy, similar to mortgage loans.

Calculation approach

In accordance with the guidelines provided in Delegated Regulation (EU) 2023/2086 of 27 June 2023, supplementing Regulation 2020/852, the Group has included those exposures that make a Substantial Contribution (SC) to the climate change mitigation and climate change adaptation objectives and are aligned with the European Taxonomy's requirements in the GAR.

To that end, a distinction is made between two allocation or tagging methodologies:

• Finance for specific purposes or uses: This includes specific finance granted by Sabadell that substantially contributes to an environmental objective and meets the DNSH and MSS criteria, in which case 100% of the exposure is reported as aligned. For the first time this year, information published by the counterparties on DNSH and MSS in their corresponding NFDRs has been considered to assess compliance with these criteria. Where no such DNSH and MSS information is disclosed by the counterparty, given that the Group cannot ensure strict compliance with these principles, the associated loan is not reported as an aligned exposure.

Furthermore, as mentioned above, under the simplified approach, the exposure of loans secured by real estate granted to households for the purchase of homes with the most efficient EPC ratings, as well loans for vehicles with a zero-emissions label or whose engine is 100% electric and which meet the size, seats and category stipulated in the Taxonomy, are both considered as aligned. In the case of foreclosed assets, a review of the information associated with their energy performance is being carried out. Alignment data will not be disclosed this year until that review is complete.

• Finance for generic purposes or for unknown purposes: This is the case when the Institution grants finance to counterparties for generic purposes, i.e. without the funds having a specific goal other than to manage the company's liquidity, cash or usual activities. As indicated in Annex V of Royal Decree 2021/2178, credit institutions should in this case use the key performance indicators related to CapEx and turnover disclosed by the counterparties themselves for each environmental objective, with no need for any additional verifications to ensure alignment with the SC, DNSH and MSS criteria.

This way, the exposure reported as being EU Taxonomy-aligned corresponds solely and exclusively to the exposure with counterparties that have disclosed the degree of their activity's alignment with the EU Taxonomy in terms of either turnover or CapEx in their non-financial disclosure reports.

To that end, it is worth noting that the Institution has gathered counterparties' eligibility and alignment information by means of a project, conducted in a coordinated manner and at a sectoral level with a reputable third party, which compiled and unified the information of counterparties subject to the NFRD that have disclosed information in their corporate reports, NFDRs or equivalent (data of firms that have not published their KPIs have not been reported, in other words, the counterparties with no reported KPIs are considered to have 0% alignment in terms of both their turnover and CapEx; no KPIs have been estimated either). The data obtained, mainly at the level of consolidated groups, has been applied to their generic exposures, for both the parent companies and their subsidiaries, always provided the intended use of the funds is for generic purposes, weighting counterparties' exposure by their degree of alignment in percentage terms (turnover or CapEx, depending on the reporting template).

It is worth mentioning that Bloomberg is used as a supplier to identify green bonds that promote climate change mitigation or adaptation, as well as bonds linked to sustainability projects, and to determine whether they meet the technical screening criteria that make them qualify as Taxonomy-aligned. In addition, the Institution relies on this supplier to obtain the exposures that are eligible and aligned with the environmental objectives of the portfolio of Assets under Management (AuM). Specifically, every month the Institution shares its AuM and Bloomberg applies various levels of data extraction to determine the final investment of those positions and report on their different KPIs. The information is the actual data reported by companies in which that position is invested and no estimates are used. This year, apart from the CCA and CCM objectives, the eligibility portion of the remaining objectives has been added.

Based on the foregoing, Banco Sabadell Group presents templates specific to credit institutions as at 2024 year-end in this report (Annex 6.3). The information contained therein has been prepared in accordance with Annex V to Delegated Regulation 2021/2178, specifying the content and presentation of public information specific to environmentally sustainable economic activities.

The templates specific to credit institutions are used, as that is the primary activity of Banco Sabadell Group, including the information of the entire scope of prudential consolidation, determined in accordance with Regulation (EU) 575/2023. The Group's scope of prudential consolidation does not include any entity that operates in the investment services or insurance activities segments. In the scope of consolidation, Urquijo Gestión S.G.I.I.C. is included within asset management services, and its degree of representation is not material with respect to the Group's total assets.

Results

As at December 2024, Banco Sabadell Group had a GAR of 4.43% in terms of turnover, with the ratio remaining stable compared to December 2023 (4.45%).

In terms of the denominator, total GAR assets increased significantly over the year, which was linked to the increase in the portfolio of loans to both households and non-financial corporations. In the latter case, it is worth noting that a considerable part of that increase was due to exposures that are unlikely to become aligned as these are exposures outside of the EU and/or financing granted to companies with no NFRD. Furthermore, during the year there was also a substantial increase in total assets with financial corporations, mainly due to the net increase in repo funding, compounded by the currency effect.

In terms of the exposure aligned with the EU Taxonomy, this increased by 607 million euros over the year, mainly due to the subsidiary TSB, and was concentrated in households, as a result of the improved process to update EPC data based on supporting documents in 2024, which improved the quality of the EPC ratings, and also due to the impact of the pound's appreciation in its currency pair with the euro during the period. Excluding TSB, the aligned exposure remained stable over the year, and it is worth highlighting the addition of the exposure associated with financial corporations, as a result of the publication, for the first time, of key performance indicators during the year, as well as the increase in aligned exposure associated with nonfinancial corporations, in turn due to the year's increase of lending but also affected by the internal review of criteria to determine aligned exposure, such that both impacts counteract the reduction over the year of the aligned exposure in the portfolio of real estate assets, as a result of various initiatives carried out in order to strengthen the control framework over the tagging of sustainable exposures and to improve data quality.

5.1 Environmental: Climate change

5.1.1 Introduction

Through its ESG action framework, Banco Sabadell has fully embedded aspects related to climate change into its governance model, its strategy, and into the management of the impacts, risks and opportunities linked to its business model and environment.

The Bank takes on the management of impacts, risks and opportunities, taking into account the concept of double materiality (financial and impact) as well as the various phases of the value chain in which they can emerge:

• In terms of impact, it is worth noting the efforts made by the Bank to reduce the environmental effects produced by the carbon footprint of its own operations, as well as its management of the carbon footprint of the financed portfolio.
• In terms of climate risk²⁰, the Bank has created the ESG credit risk guidelines, which are the framework that consolidates the ESG commitments and standards currently applied when authorising the Bank's credit transactions. Specifically, the ESG credit risk guidelines comprise the Environmental and Social Risk Framework, the advanced IRCA and decarbonisation pathways.
• Lastly, the Bank embraces the opportunities offered by the transition, supporting its customers as they face the challenges of climate change adaptation and mitigation. To that end, it offers Green and Social Loans (GSLs) and Sustainability-Linked Loans (SLLs), it offers advice and investment opportunities to its customers, and it frequently obtains funding by issuing green, social and sustainability bonds, in line with the Framework for the issuance of bonds linked to Sustainable Development Goals (SDGs).

5.1.2. Governance

5.1.2.1 ESRS GOV-3: Integration of sustainability-related performance in incentive schemes

In line with the aforementioned commitments and as described in section "2.3 GOV-3: Integration of sustainability-related performance in incentive schemes", the remuneration of those employees with variable pay includes sustainability targets.

In relation to short-term remuneration, all those with variable pay have environmental objectives included in their remuneration through the Synthetic Sustainability Indicator (SSI), which in turn is part of the Group objectives, weighted at 10%. This indicator's components include environmental factors such as Green and Social Loans (GSLs) and Sustainability-Linked Loans (SLLs) and the progress of the Sustainable Finance Plan (including progress made with decarbonisation pathways). It also considers the scores given by the three ESG rating agencies, which analyse the Bank's performance in environmental terms.

²⁰ Environmental risk is understood to be the risk of incurring losses as a result of the impacts, both those existing at present and those that may exist in the future, of environmental risk factors on counterparties or invested assets. Environmental risks can generate impacts through two factors: 'physical factors' and 'transition factors'

As for long-term remuneration, which applies to the Identified Staff, a synthetic sustainability indicator was created in 2023 for the multi-year targets set by the Group, weighted at 20%. Its composition is structured around the synthetic indicator related to Sustainable Business (green & social loans, sustainability-linked loans, and other mobilised funds) and to Diversity (percentage of women in the management team).

5.1.3. Strategy

5.1.3.1 E1-1: Transition plan for climate change mitigation²¹

Banco Sabadell continues to move ahead with its Decarbonisation Strategy, whilst at the same time moving closer to achieving global climate targets, as a signatory of the Collective Commitment to Climate Action (CCCA) and a member of the Net-Zero Banking Alliance (NZBA), in order to attain emissions neutrality in its investment and lending portfolios by 2050.

The Bank's commitment to decarbonisation covers all of its activities. It has therefore identified three main pillars, from which cross-cutting and sector-specific levers are activated:

• Strategic action framework: Banco Sabadell believes it is important to ensure that the financed portfolio is aligned with its decarbonisation targets and, to that end, it has introduced elements linked to decarbonisation in its Risk Appetite Framework, in its policies and in its sectoral planning processes, and it has set decarbonisation pathways to achieve those targets. In addition, the Bank has the Environmental and Social Risk Framework described in section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities.
• Support in the transition: in its business activity and to support customers in the transition, the Institution is taking further action to raise awareness and offer advice across all sectors of the business fabric, offering solutions to finance the investments required for this transition. To that end, it is making all of its capabilities available through specialised teams and a Sustainable Financing Framework.
• Risk management: with regard to credit risk management, the Bank has introduced ESG risk management guidelines in the process for authorising credit transactions and in its portfolio monitoring, including ongoing monitoring of decarbonisation pathways.

Against this backdrop, and with the dual goal of activating its decarbonisation strategy in parallel to supporting customers by offering them financing for their projects, Banco Sabadell follows a process that consists of two stages to achieve customer engagement:

• Know Your Customer (KYC) phase: to understand customers' economic activity, projects, climate/ environmental impact and their decarbonisation transition plan.
• Customer support phase: to advise customers through teams specialising in (i) different sector-specific solutions to reduce emissions and (ii) the optimal structure of the transaction in question.

²¹ The Institution does not have a CapEx plan for the transition since, as a financial institution, the transition plans focus primarily on providing support for customers' transition through the Bank's products and services

Banco Sabadell aligns its strategy with the Sustainable Development Goals (SDGs) and the Paris Agreement, together with regulatory and supervisory requirements, steering the organisation and helping customers and society in the transition towards a sustainable economy.

In 2020, the Group launched its Sustainable Finance Plan, which incorporates sustainability into the business model, risk management and the relationship with stakeholders, in addition to strengthening its governance with milestones such as the creation of a Sustainability Committee in 2020 and the creation of the Board Strategy and Sustainability Committee in 2021, a new Board Committee set up to define, promote and monitor all matters related to sustainability. The Sustainable Finance Plan is regularly approved, reviewed and updated by the Sustainability Committee to adapt it to environmental and regulatory changes and to the expectations of the various stakeholders. In addition, the governing bodies are informed of the most noteworthy developments.

To complement this, the document Sabadell's Commitment to Sustainability was published in 2022. This action framework aims to embed ESG considerations sequentially across all of the Group's activities.

As part of this commitment, in December 2024, the Institution published its third set of decarbonisation targets for 2030 as well as a review of the pathways published previously and the main levers to ensure transition, along with its ambition to provide support, advice and sustainable financing to individuals and especially to companies, focusing specifically on those that belong to the world's most CO2 emissions-intensive sectors.

The established targets are approved by Banco Sabadell's Board of Directors. In addition, regular monitoring reports are sent to governing bodies on the evolution of decarbonisation pathways.

In addition, in reference to the blocked GHG emissions originated from the company's key assets and products, it is worth noting that, given the activity carried out by the Institution, these emissions are not material for the Bank's operations and they therefore do not have a significant impact on its environmental sustainability or on its financial statements.

Portfolio alignment

Banco Sabadell Group considers that portfolio alignment and decarbonisation targets offer valuable information for risk management, on an ex-ante basis, as a portfolio that is aligned with a particular transition pathway and has decarbonisation targets will tend to be less impacted than one that is not aligned and has no targets (assuming the selected reference scenarios remain close to the actual trajectory).

In 2021, the Group joined the Net-Zero Banking Alliance (NZBA), thus reinforcing the strategy to fight against climate change, undertaking to align its lending and investment portfolios with net-zero emissions of greenhouse gases (GHGs) by 2050 at the latest, in line with the targets of the Paris Agreement.

In turn, these commitments involve setting targets for 2030, with interim targets to be set every five years thereafter for the most GHG-intensive sectors, based on the analysis of customers' carbon footprints and on sectoral decarbonisation pathways, which are based on scientific criteria defined by recognised international bodies.

Information about exclusions applicable to EU benchmarks

Based on the activity criteria that establish the exclusions applicable to the EU Paris-aligned benchmarks set out in Commission Delegated Regulation (EU) 2020/1818, it has been determined that the Bank is not excluded from those benchmarks on the grounds of the activity that it performs.

5.1.3.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

For the Group, environmental risk is understood to be the risk of incurring losses as a result of the impacts, both those existing at present and those that may exist in the future, of environmental risk factors on counterparties or invested assets, as well as aspects affecting financial institutions as legal entities. These risks have the potential to generate significant impacts for the real economy (institutions and households) through various socio-economic variables, including mortality, migration, job availability and productivity (by extension affecting GDP). Therefore, it is thought that environmental risk could ultimately result in borrowers failing to fulfil their payment obligations as a result of not using assets or of companies experiencing disruptions in their manufacture and supply activities that generate the income used to fulfil payment obligations.

Environmental risks can generate impacts through two 'risk drivers': 'physical factors' and 'transition factors'. There is a trade-off between physical risks and transition risks depending on how and when policies are implemented to facilitate the transition towards a sustainable economy. In particular, where actions to transition are delayed or weak, it is assumed that physical risks will increase. In the same way, where the transition actions and policies are ambitious and premature, transition risk will increase but physical risk can be expected to fall.

Environmental risks are an additional factor included in the Group's Global Risk Management Framework, using the identification and measurement of these risks as a basis for their subsequent integration into management arrangements. The type of environmental risk in which the most progress has been made in terms of analysis and recognition is climate change risk. However, the risk associated with climate change is intricately connected to the risk associated with environmental degradation and both feed into each other.

Climate scenarios and stress testing

Banco Sabadell Group has an internal stress testing framework for climate risk, which lays down the key characteristics of the tests, including their integration in the Internal Capital Adequacy Assessment Process (ICAAP). These tests are posited as a sensitivity analysis exercise.

During these stress tests, forecasts of climate risk are made in order to measure the sensitivity of credit risk to transition and/or physical risks linked to climate change and to possible transition pathways towards a decarbonised economy, according to the following scenarios:

• Scenarios for transition risk assessment:
  • Orderly transition: in the Orderly Transition scenario (compatible with RCP 1.9 scenario²²), early and decisive action is taken to attain CO2 emissions neutrality by 2050; as a result, the average temperature of the planet is no more than 1.5°C higher than in the pre-industrial era. To that end, for transition risk, the Net Zero 2050 climate scenario of the Network for Greening the Financial System (NGFS) is considered, forecast using the Remind and Magpie models.
  • Disorderly transition: in the Disorderly Transition scenario (compatible with RCP 2.6 scenario), action to combat climate change is delayed until 2030. This leads to a bigger shock, as it means that sharper action needs to be taken between 2030 and 2050 in order to achieve CO² emissions neutrality by around 2050. To that end, the Delayed Transition climate scenario of the NGFS is considered for transition risk, forecast using the Remind and Magpie models.
  • Hot House World: in the Hot House World scenario (compatible with RCP 4.5 scenario), only currently implemented policies designed to fight climate change are preserved. Emissions continue to rise at the current pace and global temperatures rise by over 2ºC. The impact stemming from transition risk is non-existent, but physical risks are more severe (NGFS Current Policies scenario).

The main sources used to develop the climate transition scenarios are the Phase IV scenarios published by the NGFS in November 2023 and the forecasts made by the ECB in its 2022 climate stress test (which in turn were based on the NGFS scenarios). Based on these forecasts, Banco Sabadell has expanded these scenarios to include other variables needed for the Group and not provided by either the NGFS or the ECB.

• Scenarios for physical risk analysis:

²² Representative concentration pathways

• ◦ Drought: this scenario considers shocks over one year on the sectoral GVAs offered by the ECB in this same scenario of its 2022 climate stress test, but applied to the Group's baseline scenario. It considers a drought that affects the productive structure of the economy.
• Forest fires: the forest fires scenario is based on the information provided by the European Forest Fire Information System (EFFIS), part of the Copernicus programme, which is a body created by the European Commission (EC) in collaboration with domestic fire-fighting authorities. This platform has been used to determine the probability of occurrence of forest fires, which in turn is used to determine the shock over a one-year period on the price of residential and commercial real estate as a result of forest fires. The scenario assumes that forest fires reduce not only the value of the real estate assets affected by the fire but also the value of nearby properties. This suggests that buyers attribute a higher risk of forest fires to the region and that the region could be less appealing to them following a fire.

The stress tests are conducted on the Group's main institution (Banco Sabadell) and for its mortgage lending and business lending exposures. Sensitivity is measured by comparing the impact on provisions of the various scenarios under analysis, considering to that end the impact of climate risk on probability of default, on loss given default, on the value of collateral, and on the accounting classification of transactions.

In addition, sensitivity to transition risk is measured by considering expected changes in the exposure's breakdown by sectors until 2050, or by level of energy efficiency in the case of the mortgage book, which is consistent with the transition scenario provided and with the Bank's sustainability targets.

To measure the impact of climate risks on the portfolio of business banking customers, there are models that capture both the indirect effects of climate risks at a sectoral level and the direct effects on the balance sheet and income statement of each company. This allows each company's risk sensitivity to be determined. The measurements in the case of retail banking customers are based on capturing indirect effects, although the specific aspects of each collateral item are considered to reflect that impact in their valuation (energy rating in the case of transition risk and physical location of the collateral in the case of physical risk).

The results of the climate risk stress tests are included in the ICAAP in order to evaluate the impact that those risks could have on the Group's solvency from the point of view of expected loss on one hand and of unexpected loss on the other, by measuring how much economic capital is required at the Group level to cover any losses that are reasonably likely to materialise due to those risks.

The impact of physical and transition risks on the Group's solvency position is limited, from both a regulatory perspective and an internal perspective. The measurement of economic capital, which is made at the Group level and considers the climate risk sensitivities used in stress tests, shows that the economic capital requirements for this risk are less than 1% of total economic capital requirements, meaning that the risk has a limited impact on the Group's solvency, particularly considering the time horizon over which it materialises.

5.1.4. Impacts, risks and opportunities management

5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities

Banco Sabadell considers its interactions with the environment based on the concept of double materiality, which includes both financial materiality, which focuses on identifying and assessing risks and opportunities, and impact materiality, which focuses on evaluating and measuring the potential and current impacts of Banco Sabadell on the environment. In addition, in this analysis Banco Sabadell considers whether these materialise in any of the three phases of the Bank's value chain (upstream, own operations, or downstream).

From the point of view of impacts, the Bank considers greenhouse gas (GHG) emissions, taking into account both those produced in its own operations and those that occur in other phases of the value chain and, in particular, in the financed portfolio, which represents one of the largest categories of the Institution's GHG inventory.

From the financial point of view, the business opportunities stemming from the transition to a greener economy are considered (for details see section 3.1 SBM-1: Strategy, business model and value chain of this report), as are climate risks, particularly those to which the Bank's credit book is exposed due to the characteristics of its borrowers.

In this respect, the Group identifies environmental risks (those related to climate and environmental degradation) according to whether they are transition risks or physical risks. Specifically, climate-related risks are measured broken down by transition and physical drivers, while risks associated with environmental degradation (other non-climate-related factors) are measured in aggregate form, without distinguishing between the nature of the drivers in question (transition or physical).

Physical climate risks

Physical climate risks are those that emerge as a result of climate events. They can be categorised as either acute risks or chronic risks. Physical risks could lead to a number of consequences, among them the destruction or disuse of physical assets and business disruption, in turn leading to the risk of collateral losing value due to the impeachment for waste of the commercial or residential properties securing the loans. The following physical factors or 'physical risks' have been identified (this list is non-exhaustive):

Factors		Possible impacts
Acute	Increased severity of extreme weather events, such as (i) heat waves (ii) cold snaps, (iii) forest fires, (iv) cyclones / hurricanes / typhoons / storms / tornadoes, (v) droughts, (vi) heavy rainfall, (vii) flooding, and (viii) landslides and subsidence.	Reduction of income due to reduced production capability (e.g. standstills in production, in the supply chain or transportation difficulties). Direct losses due to damage to assets.
Chronic	Changes in rainfall patterns and extreme climate variability. Impacts on exposures with sensitivity to (i) changing average temperatures, (ii) heat stress and thawing of permafrost, (iii) changing wind patterns, (iv) changing patterns and amounts of rainfall, (v) water stress, (vi) land and coastal erosion, (vii) land degradation and (viii) rising sea levels.	Loss of value of customers' assets serving as guarantees due to their being located in areas affected by these risks (desertification, rising temperatures, rising sea levels, among others). Loss of productivity among business customers due to effects on production centres (more frequent breaks from work due to higher temperatures, rising sea levels, among others).
	Gradual loss of ecosystem services (water and food production, climate control and disease prevention, support for the pollination of crops and cultural benefits).	Decline of production and/or profitability of customers who depend on ecosystem services.

Following this definition, Banco Sabadell Group has conducted a top-down estimation of the impacts stemming from these climate events on its loan portfolio in Spain taking into account:

• The probability of occurrence of physical risk: probabilities have been assigned using climate event risk maps. For each event, the probability of occurrence in each postcode is estimated, based on historical data gathered from public sources (i.e. European Forest Fire Information System (EFFIS) data for forest fires, which uses data from the European satellite Copernicus, etc.). This makes it possible to assess the probability of occurrence of events that could have a more significant impact on the portfolio, based on the location and activities of customers. Using this data, the Group has identified a total of 16 events (8 acute and 8 chronic) that could affect the loan portfolio, having calculated a probability of occurrence for 11 of them in the Spanish portfolio: Floods, Forest fires, Rising sea levels, Droughts, Hot spots, Landslides, Maximum temperatures, Minimum temperatures, Rainfall and thaws, Fog and airborne dust, Storms, winds and gales.
• The severity of those risks should they occur: understood as the impact if physical risk were to materialise, estimated according to expert criteria at a sectoral level for the business lending portfolio and in terms of the location of the collateral for the mortgage portfolio. The final conclusion is based on the aggregate impact of the four events (coastal and riverine flooding, forest fires and droughts) to which the Institution has, for now, applied a severity calculation given their more severe potential consequences.
  • In physical business risk, the severity of the events represents the percentage of revenues that a company could lose if that event were to occur, due to its business coming to a standstill. Therefore, depending on the type of activity in which the company engages, different events can

have different effects on borrowers, which is why the severity is defined based on the event and the activity according to the European classification of economic activities (NACE).

• In the case of physical collateral risk, the severity is the percentage of the collateral value that could be lost if the event took place. In this case, the severity does not depend on the borrower's activity, so all mortgage contracts secured with real estate have been treated the same way, regardless of the type of property securing the loan.

The probability of occurrence of each event is multiplied by its severity and these figures are added together to give the expected impacts, which are the basis for creating physical risk indicators:

Expected impact = ∑(Event probability of occurrence × Event severity)

This way, for each loan granted to businesses with a Spanish postcode and for each mortgage contract secured with real estate, the physical risk can be classified as either "None", "Low", "Moderate", "High" or "Very High".

In addition, the Group has internally developed a methodology that distinguishes between acute and chronic events in line with the three scenarios (Orderly Transition, Disorderly Transition and Hot House World) of the Network for Greening the Financial System (NGFS)²³ and adapted to a time horizon of 30 years. These risks are being monitored regularly and meticulously under the Orderly Transition scenario, as this is considered the most likely scenario, although these monitoring exercises do also include the overall impact under the worst-case scenario (Hot House World). This analysis measures the risk inherent in the portfolio and not the residual risk, as it does not consider the existence of cover, such as home insurance and/or the existence of the Spanish Insurance Compensation Consortium (Consorcio de Compensación de Seguros), among other things.

It is also worth highlighting that in 2023, the Institution took a significant step forward in the measurement of physical risk and its integration in management arrangements, with the bottom-up analytical methodology defined for the main counterparties at the level of large corporates, as these are thought to be more complex and deserving of a complementary specific analysis. This way, for those enterprises, the Bank conducts a more in-depth expert analysis in cases where this is considered necessary, and can provide more information to the Bank's top-down model. This analysis is carried out using public information about the customer, the internal physical risk model and the expertise of the Bank's ESG analysts, taking into consideration, among other things, the counterparty's reliance on physical assets, the geographical diversification of their production centres and their activities, and the controls currently in place to mitigate and/or reduce these risks.

Lastly, it is important to note that in 2024, the Institution took another major step forward in its measurement of physical risk and its integration into management arrangements, with the development of capabilities to measure, using georeferenced data management software, the physical risks linked to riverine and coastal flooding and forest fires in Spain at different geographical coordinates. This improvement has been applied to 86% of the mortgage-secured loan portfolio in the country for which coordinate-based locations are available, which has significantly improved the granularity of the prediction and the quantitative assessment of the potential impact of these events.

The Group continues to work on measuring physical risk in the different geographies in which it is present, through the Bank's task forces with teams at the various foreign branches. First, based on companies' activities, those likely to be more severely affected should any of the events occur were selected before proceeding to evaluate the probability of occurrence of the events, thanks to the expert knowledge about the location and the climate reality of each country, in a manner that is consistent and coordinated with the methodology applied in Spain and described above. Similarly, in relation to TSB, bearing in mind that its credit book mainly comprises mortgage assets, a model analogous to the top-down model defined above was applied, albeit considering the specific characteristics of its geography, where the main physical risks are flooding, subsidence and coastal erosion.

The physical risk assessment is further complemented with a deep-dive analysis into certain climate events with a high associated impact. In 2023, following the droughts that occurred in Spain, an analysis of how that event was dealt with and of its potential impact on the loan book was carried out. The loan book was analysed to determine the quality of the Bank's exposure in this sector and to take a closer look at possible additional

²³ For more information about the scenarios used, see section "Climate scenarios and stress testing" of chapter 5.1.3.2

mitigating techniques (e.g. the agricultural insurance taken out by companies) and, using all this information, an action and monitoring plan was devised for these companies by the Bank.

Furthermore, in 2024, due to the flash floods caused by the DANA storm in Valencia on 29 October, the granularity improvements mentioned earlier at the coordinates level were applied in practice, making it possible to anticipate the potential impact of the event on the loan book as well as the assistance required by customers in the affected area and the risks associated therewith, in terms of the portfolio of loans granted to both business and retail customers.

The coordinate-based assessment for events of this kind evidenced the importance of granularity in the measurement, as the very terrain or distribution of towns means that the same event can have and does have a different impact on properties in the same location.

Conclusions of the physical risk measurement analysis

Taking all of the above into consideration, the most prominent physical risks in the portfolio in Spain are forest fires, droughts, floods resulting from severe storms, as well as coastal floods and/or rising sea levels.

Using the aforesaid methodology, the Bank's exposure²⁴ in Spain associated with physical risk is as follows:

• Business portfolio: 1.7% is associated with "Very High" risk and 8.5% with "High" risk, remaining largely stable and with no significant changes compared to the previous year.
• In the collateral portfolio, the exposure with an annual expected impact of over 5% on the collateral valuation and which is therefore classified as "High" risk fell from 13% in 2023 to 5% in 2024; however, the percentage of the portfolio that is not expected to be affected by these events went from 7% in 2023 to 70% in 2024, thanks to the improvements delivered by switching from the application of a probability of occurrence of events at the postcode level to its application at the coordinates level, which improves the risk screening generated by geolocating properties in the portfolio, making it possible to more accurately pinpoint properties that could potentially be affected by these events.

²⁴ Exposure means the amount drawn down and contingent risks in the loan book

In addition, physical risk also changes depending on the sector, as mentioned in the description of the severity of the impact should an event materialise. The sectors most sensitive to this risk are production sectors such as the manufacturing industry and the energy sector, followed by the agriculture, forestry and fishing sector and the real estate sector.

As for the subsidiary TSB, located in the United Kingdom, taking into account that the credit book mainly comprises mortgage assets, and also considering the specific characteristics of that geography, the main physical risks are flooding, subsidence and coastal erosion, while in the case of Mexico and Miami (United States), the potential impact of hurricanes is considered.

To ensure physical risks are supervised, they are monitored on a quarterly basis and reported to the Bank's Sustainability Committee and to its Technical Risk Committee²⁵ .

Climate transition risks

Transition risks are those that occur due to the uncertainty associated with the timing and speed of the process of adjusting to an environmentally sustainable economy. This process can be affected by four factors:

Factors		Possible impacts
Policy & Legal	Increase in the cost of emissions or the use of natural resources.	Risk of borrowers failing to fulfil their payment obligations, particularly those with non-performing assets or belonging to sectors particularly exposed to transition risks.
	Increase in requirements concerning the monitoring, control and reporting of climate-related and environmental disclosures.	Increase in resources dedicated to the analysis, reporting and integration of transition and environmental protection plans in companies' activity. Potential increase in regulatory capital requirements
		for risks associated with climate change.
	Change in regulations of existing products and services.	Forecast increase in environmental demands going forward and lack of preparation in some sectors.
Technology (ICT)	Substitution of existing products and services with other more efficient or less polluting ones.	Risk of companies being pushed out of their respective activities due to a lack of innovation or failure to adopt technologies that promote the green transition compared to competitors.
	Failed investment in new technologies. Costs of transitioning to low-emissions technologies.	Technological changes depend on the availability of technology, in turn associated with investment in R&D, meaning that this aspect will determine the survival of some companies, especially those smaller in size.
Market	Changes in consumer preferences and/or tastes in relation to the transition to a more sustainable economy.	Risk of losing market share as a result of failing to offer sustainable products or due to poor ESG performance.
	Increased cost of raw materials.	Reduction of income due to increased costs of raw materials in certain carbon-intensive sectors.
Reputational	Stigmatisation of a sector, company or product.	Loss of customers' solvency due to poor reputation as a result of the lack of a sustainable strategy or due to an incident or poor ESG ratings of a third party.
	Investment exclusions in certain sectors due to market pressures.	Loss of confidence among the general public.

Analysis of climate transition risk in the business portfolio

Banco Sabadell Group has internally developed several heatmaps at a subsector level, aligned with the three scenarios (Orderly Transition, Disorderly Transition and Hot House World) of the Network for Greening the Financial System (NGFS)²⁶ and the recommendations of UNEP FI and adapted to a time horizon spanning 30 years. These risks are being monitored regularly and meticulously under the Orderly Transition scenario, which is

²⁵ Details of the attributions of management bodies in climate-related matters are provided in chapter 2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies"

²⁶ For more information about the scenarios used, see section "Climate scenarios and stress testing" of chapter 5.1.3.2

considered the most likely scenario. However, these monitoring exercises do also include the overall impact under the worst possible scenario (Hot House World).

Based on this, all the activities of the loan portfolio have been classified according to their sensitivity to climate transition risk under a top-down analytical approach and taking into account the impacts envisaged in each scenario in terms of income, expenses and low-carbon capex.

It is worth noting that the heatmaps are continuously updated in order to obtain the impacts stemming from transition risk with a greater level of granularity. The Bank therefore currently has the capacity to identify the transition risk of each separate activity within a single sector. This is important for sectors involving a variety of activities that differ considerably in terms of emissions. For example, cattle rearing and rice growing, which both form part of the agriculture and livestock farming sector, are associated with higher levels of emissions intensity than the other activities within that sector.

In the case of transition risk, the total impact considers the impact broken down by income, costs and lowcarbon capex. Impacts are classified as "Positive" for activities in which the transition could have a positive effect on one or more parameters, as "No Risk", "Low", "Moderately Low", "Moderate", "Moderately High", or as "High", which includes, for instance, the activities most affected by transition risk such as coking plants. This impact analysis measures the inherent risk of the portfolio and not the residual risk, as the controls that each counterparty currently has in place to mitigate it are not considered.

Example of how transition risk is integrated in management arrangements: bottom-up analysis of large borrowers

In 2024, progress has continued to be made on the measurement of transition risk and its integration into management arrangements, updating the model used for the batch measurement of these risks to include the bottom-up analyses conducted when evaluating the advanced Climate-related and Environmental Risk Indicator (IRCA, by its Spanish acronym). This way, the Bank has expanded the volume of counterparties for which it conducts a more in-depth expert ESG analysis in cases where this is considered necessary, and can provide more information to the Bank's model.

The advanced IRCA is an internal standardised approach used to measure climate-related and environmental risk for counterparties that are large corporates, as it is thought that their increased complexity merits a complementary specific analysis. This analysis can be broken down into each of its constituent parts, one of which is the measurement of transition risk. This way, the Bank conducts a more in-depth expert analysis in cases where this is considered necessary, and can provide more information to the Bank's top-down model.

This transition risk assessment is conducted using publicly available information about the customer, the internal transition risk model and the expertise of the Bank's ESG analysts, taking into consideration the IRCA methodology.

To effectively integrate these results into management arrangements, this methodology has been defined in line with the top-down model, so that its outputs can be integrated in a coherent way and feed into each other.

This process has resulted in an improved methodology for measuring the portfolio's transition risk, as borrowers are now evaluated in more detail.

Conclusions of the transition risk analysis:

Based on everything mentioned thus far, the Group's most affected portfolio is its business portfolio, although as shown in the chart, it is currently thought that the Bank has minimal exposure²⁷ (around 0.01%) to the segment with the highest transition risk ("High").

²⁷ Exposure means the amount drawn down and contingent risks in the loan book

Breakdown of transition risk exposure in business lending portfolio (%)

In 2024, transition risk remained broadly stable, although it is worth noting the 1% reduction in "Moderate" risk and the 1% increase in the "Low" and "No Risk" categories.

This exercise also cast light on the limited weight of sectors with higher transition risk (aviation, shipping, mining, automotive, and oil extraction, mining & quarrying), which play a secondary role in terms of exposure within the Institution's portfolio.

Specifically, the five industries that account for the majority of the transition risk in the business portfolio are shown below, along with the proportion of the transition risk exposure rated "Moderately High" relative to the total for that sector ('exposure to categories with lower transition risk'). At the same time, the percentage indicates the weight of the sector²⁸ in the Bank's credit book:

²⁸ The percentage is calculated taking into account the amount drawn down, including contingent risks, in the sector relative to the total amount drawn down in the loan book

As can be seen in the figure, the Bank's level of exposure to sectors with "Moderately High" transition risk is limited. It is also worth noting the high percentage of the exposure classified as green within the electricity generation sector, due to the Institution's ability to spearhead the financing of renewables, which allows it to have a portfolio with a lower transition risk than one would expect for a carbon-intensive industry.

Analysis of climate transition risks in the collateral portfolio:

The transition risk associated with real estate properties financed by the Bank (mortgage loans) is measured differently from business risk. Specifically, it is evaluated based on the properties' energy efficiency, which is measured using Energy Performance Certificates (EPCs).

It should be noted that the Bank is continuously working to collect the largest amount of data possible about the EPC ratings of properties (commercial real estate with residential use and residential real estate), both in its mortgage book and in its collateral portfolio, as well as foreclosed assets. It is worth mentioning that, depending on the type of property, the issuance of an EPC may not be mandatory, as is the case with garages, sheds, building plots and warehouses, for which no energy-related data is available.

The Bank has an EPC rating for almost all the properties in its portfolio, as a result of the efforts made to obtain the actual certificates, where they exist, and to estimate the ratings through a reputable third party where no EPC rating exists due to aspects related to the practical application of the regulation.

In this respect, the Bank prioritises the collection of actual EPCs for financed properties, based on data provided by the customer or taken from public databases (such as those of Autonomous Communities in Spain). To identify or, where necessary, estimate the energy rating of properties located in Spain, four mechanisms have been established to obtain that data (the first being the one with the highest quality):

• a. First mechanism: obtain data based on the Energy Performance Certificate (EPC).
• b. Second mechanism: obtain data by directly looking up the property in question on the public databases of Energy Performance Certificates (EPCs) of the Autonomous Communities.
• c. Third mechanism: used where it has not been possible to obtain data using the previous two mechanisms, it consists of obtaining data for the property based on its similarity to other properties that do have an EPC rating located in the same building.
• d. Fourth mechanism: used where none of the previous mechanisms have yielded the requisite data. It consists of making an estimate using a model created by the supplier. The estimation model was built based on information taken from the more than four million EPC ratings included in the records of Autonomous Communities. It is a model that assigns a rating to properties, considering the information included in land registers (type, age, building regulations, construction quality, surface area and relative height), as well as the climate zone in which they are located. It is not a statistical or regressive model, but instead an expert replica of accredited programmes used to calculate EPC ratings, pooling data for each item included in the certificates and estimating the rating using the limited information available about properties.

The supplier's model was supervised by an external auditor with the primary aim of verifying that the model allows requirements to be met. The report concluded, generally speaking and based on the tests carried out, that the information used and the procedure developed to obtain and estimate EPC ratings is adequate.

Outside of Spain:

• In the United Kingdom, estimated EPC ratings are completed based on average estimated ratings of postcodes, where available. Where they are not available, the outputs of a regression model are used.
• In Mexico, a model for estimating EPC ratings and energy consumption (KWh/m² ) provided by an external supplier has been used.

In the case of TSB, its credit book is almost entirely made up of mortgages, with an average energy performance. Given that practically all of the portfolio is made up of mortgages, almost all of TSB's transition risks come from the energy performance of the properties used to secure mortgage loans and from the cost of improving their energy efficiency rating (in the short, medium and long term).

Lastly, it is worth noting that EPC ratings are regulated by European Directives and are not mandatory outside of Europe. In addition, the Directives are general frameworks used to define EPCs, but each country is responsible for specifying and defining its own associated technical requirements according to the particularities of each region in their domestic regulations. This is why, although the same classification system is used, the same EPC rating in two separate European countries does not reflect the same impact in terms of energy consumption and emissions, and this data is therefore not thought to be comparable.

To ensure transition risks are monitored, they are tracked on a quarterly basis and reports are sent to the Bank's Sustainability Committee and to its Technical Risk Committee²⁹ .

Integration in management arrangements

Effective integration of environmental risks into management arrangements requires a strategy and set of regulations that establish the action guidelines, targets and limits required at different points of the credit approval workflow.

The Bank has created its ESG credit risk guidelines, which are the framework that consolidates the ESG commitments and standards currently applied when authorising the Bank's credit transactions. Specifically, the ESG credit risk guidelines comprise the Environmental and Social Risk Framework, the advanced IRCA and decarbonisation pathways. The verification of ESG credit risk guidelines has been embedded into the advanced IRCA evaluation process, meaning that, when ESG analysts receive a loan application from a customer who is subject to the advanced IRCA analysis, they conduct an additional evaluation of their fulfilment of the Environmental and Social Risk Framework, where the Sectoral Standards are included, and of their decarbonisation pathways.

ESG credit risk management guidelines

As planned, work has been undertaken to create a single framework to manage ESG credit risk that incorporates all standards on this topic that are currently applied when authorising the Bank's credit transactions. For this reason, the ESG credit risk management guidelines were created, which include:

1. Environmental and Social Risk Framework at the customer level, to identify from the outset whether a new transaction could be associated with any of the restricted activities.

Specifically, Banco Sabadell Group has a public framework of environmental and social risks that is applicable to new loan transactions granted to groups or companies with turnover in excess of 40 million euros³⁰, which represents a very considerable portion of the Bank's portfolio. This framework consolidates the set of applicable criteria that aim to restrict the financing of customers or projects that the Institution considers to be contrary to the transition to a sustainable economy or that lack alignment with international regulations or best practices in the industry.

This framework lays down general criteria and specific criteria applicable at either the customer or project level:

• general applicable criteria, which have a cross-cutting impact on all sectors, follow international standards such as the Global Compact and the principles of the International Labour Organisation (ILO), among others.

²⁹ Details of the attributions of management bodies in climate-related matters are provided in chapter 2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies" ³⁰ At the customer level, restrictions will be considered whenever customers apply for finance of over €25m. In the case of projects, restrictions will be considered for transaction amounts of over €5m

• specific applicable criteria affect businesses or projects in particular sectors (mining, energy, agriculture, infrastructure and defence) due to their potentially negative impact on the environment and/ or society, in which the Group provides services and/or offers financial products.

The rules that incorporate the current framework are all approved and implemented in the Bank's systems. The analysis of these rules is effectively integrated in the usual customer onboarding, transaction origination, and new product approval processes. To ensure this correct implementation, the Bank has included in its onboarding process (the risk management record process) the automatic identification of transactions subject to the framework and which require a compliance analysis. The ESG analysts in charge of conducting those analyses have a specialised tool for screening any disputes associated with the counterparties, which is backed by the services provided by a reputable third-party supplier³¹ .

The Environmental and Social Risk Framework has been implemented in phases in order to adapt the applicable criteria to the trends of the various sectors, the regulatory and economic environment, and the Bank's performance.

The full content of the framework, as well as its phased implementation, was approved by the Management Committee in January 2023, following submission to the Sustainability Committee for information in January of that same year.

In the specific case of Banco Sabadell Mexico, as part of the Environmental and Social Policy, the Institution has developed the Environmental and Social Risk Management System (Sistema de Administración de Riesgos Ambientales y Sociales, or SARAS), which serves as a guide to promote sustainable economic growth through the identification, assessment and management of any environmental and social risks arising from its activities and financed projects. This system is fully aligned with the operational and credit processes of Banco Sabadell Group, national laws and international standards. The SARAS process is mandatory for the infrastructure projects of the various sectors financed by Banco Sabadell Mexico with traditional loans, syndicated loans and financial intermediaries amounting to 5 million US dollars or more.

• 1. Advanced IRCA: indicator that allows the Institution to screen the ESG risk of the companies to which it provides finance whilst at the same time considering their performance in relation to the management of climate-related and environmental risks. It is used to define credit risk management policies and to identify potential opportunities for investment to support emissions-intensive companies in their transition towards more sustainable activities (see section on "Climate-related and environmental performance of the loan book").
• 1. Decarbonisation pathways: for borrowers operating in sectors affected by the decarbonisation pathways defined by the Group (see heading 5.1.5.1 E1-4: Targets related to climate change mitigation), the Bank starts to evaluate the suitability of significant transactions in which the pathways are applied as soon as they are originated. At present, there is a specific workflow established to identify, evaluate and monitor transactions subject to pathways.

So that the application of the ESG credit risk management guidelines may be effective, the Bank has a centralised team of specialised ESG analysts, who are responsible for conducting the advanced IRCA evaluation of borrowers and for determining their level of compliance with the ESG credit risk guidelines. This way, the complete ESG analyses include an advanced IRCA evaluation, an assessment of the compliance with the Environmental and Social Risk Framework, as well as a specific analysis of decarbonisation pathways in the case of transactions subject to sectoral pathways.

This analysis is carried out centrally through the Bank's internal portal, where the full analysis of borrowers is added, along with any relevant supporting documents, so as to ensure the correct traceability of opinions related to ESG criteria for credit risk decisions.

³¹ An external tool has been acquired for research, ratings and collection of analytical data concerning performance in Environmental, Social and Governance (ESG) topics for companies

5.1.4.2. E1-2: Policies related to climate change mitigation and adaptation

Banco Sabadell Group has a Sustainability Policy in addition to an Environmental and Social Risk Framework and other associated policies and procedures, such as the environmental management system and Banco Sabadell's Environmental Risk Policy which, together, serve to frame the Group's activity and organisation within ESG parameters. Environmental, social and governance factors are present both in decision-making and when responding to the needs and concerns of all its stakeholders. As a result of that same goal, Banco Sabadell, TSB and Banco Sabadell Mexico have incorporated the aforesaid parameters into their own policies and internal procedures.

The Sustainability Policy, the Environmental and Social Risk Framework, and their associated procedures are intended, as a whole, to mitigate the potential impacts and risks that may occur, and to support the Group in business opportunities and in enhancing its reputation and good practice, incorporating ESG parameters in all of the Institution's activities and organisation.

The policies incorporate environmental, social and governance factors in decision-making and, at the same time, based on those factors, they respond to the needs and concerns of all of its stakeholders. They also lay down the basic principles that Banco Sabadell Group follows to take on the challenges posed by sustainability, such as:

• Climate change mitigation and adaptation, endeavouring to align them, where appropriate, with the Institution's business strategy and risk appetite, as well as its policies, processes and controls.
• Energy efficiency. In line with environmental protection, the Group undertakes to reduce its GHG emissions by implementing energy efficiency measures.
• In line with its Sustainability Policy, the Group fosters financing and the rollout of renewable energy.

In relation to environmental management, Banco Sabadell takes on the following commitments:

• Comply with legal and other requirements applicable to activities, products and services in the various geographies in which the Group operates.
• Embed climate risks into the Group's risk management and strategy.
• Move towards the net-zero by 2050 target, establishing achievable and measurable interim goals.
• Integrate environmental, social and governance criteria into management and decision-making within the Group's strategy.
• Promote innovation, development, supply and incentives for financial services and products designed to finance projects that reduce GHG emissions, such as renewable energies, energy efficiency and sustainable mobility.
• Continuously improve the performance of the environmental management system, driving the implementation of energy efficiency measures and the use of renewable energy in the Group's facilities, and fostering the use of sustainable transport options by employees and, in general, promoting the sustainable management of the resources needed for the Group's day-to-day activity.
• Establish work guidelines and control mechanisms to ensure environmental protection and pollution prevention in its facilities.
• Share these principles with employees and Group companies, fostering internal and ongoing training of the workforce in relation to sustainability and energy efficiency, and set up fluid communication channels with the various stakeholders on environmental matters.

Similarly, in a cross-cutting way and in line with its commitment to sustainability, Banco Sabadell continues to forge alliances with other sectors and is part of major international initiatives designed to fight climate change and improve social development. These alliances are specified in the policies indicated here below.

Where the scope of the following reported policies makes specific reference to Banco Sabadell Group, it includes information that covers the entire banking business perimeter, taking into account the Banco Sabadell brands that operate in Spain; TSB, which operates in the United Kingdom; and Banco Sabadell Mexico, which operates in Mexico.

Banco Sabadell Group Sustainability Policy

Banco Sabadell Group's commitment to sustainability also takes the form of its voluntary adherence to various national and international initiatives and commitments:

• United Nations Global Compact on human rights, labour, the environment and anti-corruption (signed in 2005).
• UNEP FI Principles for Responsible Banking (founding member since 2019).
• UNEP FI Net-Zero Banking Alliance (member since 2021).
• United Nations Principles for Responsible Investment, individually signed by various investees and subsidiaries of the Bank: BanSabadell Pensiones E.G.F.P., S.A. (in 2012), Aurica Capital (in 2016), BanSabadell Pentapension Empresa FP (in 2020), Fondo de Pensiones de los Empleados de Banco Sabadell MF2000 (in 2020), Fondo de Pensiones de los Empleados de Banco Sabadell GM (in 2020)
• Equator Principles (signatory since 2011).
• Carbon Disclosure Project (CDP) (signatory since 2012)
• Collective Commitment to Climate Action, promoted by AEB, CECA and ICO (undertaken in 2019).
• Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) (followed since November 2020).
• IOSCO Recommendations related to sustainable finance (June 2019).
• Adherence, through the Spanish Banking Association (AEB), to the Protocol to strengthen the social and sustainable commitments of banks, signed by all banking employers' associations in July 2021 and updated to focus on the financial inclusion of rural areas in October 2022.
• Adherence, since October 2022, to the Protocol signed by banking employers' associations with Correos (the Spanish postal service) to provide cash withdrawal and deposit services at all Correos service points (protocol signed in July 2022).

From the perspective of double materiality, and in line with the guidelines issued by the main bodies governing that subject matter, both local and international, the Sustainability Policy covers the main impacts of the Group's activity, with the aim of adapting the organisation to the challenges and opportunities stemming from sustainability.

In relation to environmental impacts, the Group seeks to mitigate the possible impacts, promoting management systems based on internationally accepted regulatory standards and on the philosophy of continuous improvement. In that respect, the Group has undertaken commitments to reduce its internal environmental footprint, as described in section 5.1.5 Metrics and targets, in addition to the decarbonisation commitments of its financed portfolio.

From the point of view of ESG risks, the Group includes them in its assessment, management and control processes through the activities being carried out to achieve, as a matter of priority, the objectives defined in the Sustainability Plan.

The actions aimed at preventing environmental risks and minimising the impacts of the Group's activity on the environment open the door to emerging opportunities that strengthen and support the Group in the development of its business model and strategy. The management metrics on which the Group's Sustainability Policy is based promote the creation of a set of products and services that incorporate sustainability criteria, in both lending and investment, in response to the increasing demands of our consumers and investors.

When it comes to the governance structure of the Sustainability Policy, the Board of Directors is the body with maximum responsibility for setting the Group's business strategies, for establishing principles, commitments and objectives in relation to sustainability and for embedding them into the Group's strategy, in addition to approving the policy. Given that it is a Group-level policy, all subsidiaries, in particular Sabadell Mexico and TSB in the United Kingdom, adhere to it, applying all of the principles and parameters included therein.

The Group has committees and a specific policy in place to manage and control environmental risk. In terms of the governing bodies, the Sustainability Committee is responsible for establishing and promoting the Bank's Sustainability Plan (Sabadell's Commitment to Sustainability) and monitoring its implementation, as well as defining and disclosing the general action principles related to sustainability and promoting the development of related projects and initiatives structured around the various courses of action set out in the Bank's internal Sustainable Finance Plan. The Board Strategy and Sustainability Committee, for its part, is responsible for supervising the model for the identification, control and management of risks and opportunities related to sustainability.

TSB's Do What Matters Plan 2025

In addition to adhering to the Group's sustainability policies, the subsidiary TSB has set out its own commitment to the planet and to society, called the Do What Matters Plan 2025, which is an integral part of its business strategy. The plan brings with it a series of environmental and social commitments, with eight long-term objectives ranging from targets for the transition to a greener planet to actions to foster financial inclusion. The plan aims to deliver a long-lasting impact in terms of sustainability for its customers, workforce, suppliers and the wider community in which the Bank conducts its activity.

TSB's Board of Directors provides strategic guidance about the Bank's approach to the DWMP, including the way in which the Bank manages the financial risks and opportunities of climate change. The Board receives annual updates of the Plan, and regular updates in relation to climate risk are also provided to the Risk Committee.

TSB's Executive Committee analyses the Plan's progress on a quarterly basis, in which it includes the recommendations and advancements reported by the Planet Steering Committee and the People Working Group.

Banco Sabadell Group Environmental Risk Policy

The purpose of the Environmental Risk Policy is to lay down general guidelines for the management and control of environmental risk, specifying the applicable principles and critical parameters and addressing all elements that are important to manage and control the risks associated with climate change and environmental degradation. These risks comprise two main risk factors: physical risks and transition risks.

Among the main objectives of the Policy is that of observing and embedding existing legal requirements and the commitments and initiatives undertaken by the Institution. These include the European Union's sustainability regulation, developed in 2018 under the European Commission's Sustainable Finance Action Plan (SFAP), and the action plans, guidelines, guidance, technical standards and documents issued by the ECB and European supervisory authorities (namely the EBA, the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA)). The Policy also embeds other voluntary guidelines and major international agreements, such as the Paris Agreement, the 2030 Agenda, the Task Force on Climate-related Disclosures (TCFD), the Task Force on Nature-related Financial Disclosures (TNFD), and the Basel Committee's Principles for effective management and supervision of climate-related financial risks.

The Environmental Risk Policy is reviewed at least once a year and is approved by the Institution's Board of Directors. It involves multiple areas in environmental risk management and control, which are made responsible for applying it in their respective management and control areas, given the cross-cutting nature of environmental risk, which materialises through its effect on other banking risks included in the Global Risk Framework of which there are mainly four: credit risk, market risk, liquidity risk and operational risk.

• • In terms of credit risk, exposure to environmental risk is assessed in all phases of the lending process and when overseeing portfolios, as is the impact on asset prices and the valuation of assets used as collateral.
• In terms of market risk, an evaluation is made of the impact that substantial and relatively sudden downward revaluations could have on the price of the assets in the Institution's portfolio, altering their value.
• In terms of liquidity risk, the liquidity position's exposure to environmental risk is measured, anticipating potential significant net outflows of liquid resources or the deterioration of liquidity buffers in the event of a material impact that is not currently covered by the implemented processes and mitigating factors.
• Lastly in terms of operational risk, environmental risk is assessed and adjusted in the operational continuity plans and the regulatory requirements in relation to ESG matters are taken into account when offering advice about and selling financial products.

In view of the foregoing, the Environmental Risk Policy is the framework defined for appropriately managing and controlling the environmental risks to which the Institution is exposed and for rolling out measures aimed at the mitigation and adaptation of climate change and environmental degradation.

5.1.4.3. E1-3: Actions and resources in relation to climate change policies

As a financial institution, Banco Sabadell Group plays a fundamental role in building an inclusive and decarbonised economy. On one hand, mobilising resources, identifying technologies and generating opportunities and, on the other hand, incorporating new capabilities along with internal transformation efforts to embed sustainability into all of its agendas.

In this context, and to continue making progress with its goal of accelerating economic and social transformations that contribute to sustainable development, the Bank already reinforced the ESG dimensions applicable to its strategy, governance and business model back in 2022, with the launch of its ESG framework, Sabadell's Commitment to Sustainability, which establishes levers with transformation and promotion actions, notably including the following:

• Progress as a sustainable Institution, focusing, among other things, on greenhouse gas (GHG) emissions neutrality.
• Support customers in the transition to a sustainable economy, laying down decarbonisation pathways, supporting customers in the transition with specialised solutions for renewable energy, energy efficiency and sustainable mobility, and defining sectoral standards that limit controversial activities and/or activities with negative impacts on environmental and social development.
• Offer investment opportunities that contribute to sustainability, where it is particularly worth mentioning the wide range of sustainability funds, green bonds and sustainability bonds that the Bank offers, both its own and of third parties.

As part of Banco Sabadell Group's progress towards GHG emissions neutrality, key actions are being taken in its facilities aimed at reducing emissions in each scope (1, 2 and 3), such as:

Scope 1 - Direct emissions

Actions relating to this scope include those aimed at reducing emissions generated by the consumption of gases and leaks of refrigerant gases in the Group's facilities, as well as by the use of company vehicles.

Fossil fuel gases

In Spain, Banco Sabadell's physical switch between data centres was completed during 2022 and 2023, moving from its own facilities to those of its technological infrastructure provider. As a result, diesel consumption in 2024 was -55% lower than in 2021, mainly due to the reduced use of electric generators that ensured the electricity supply for data centres. However, due to the use of mobile branches in Galicia, Asturias and Valencia, diesel consumption was up by 2% compared to 2023 and by 9% compared to 2022.

Similarly, in 2024, TSB completed the third phase of its Energy Optimisation Programme, resulting in a -2,600 MWh reduction compared to 2023 in the consumption of location-based gases from fossil fuels and electricity. The programme consists of different initiatives, including exploring the phase-out of its fossil fuels, reducing waste generated by its activity, testing out new water saving technology, finding ways of eliminating paper usage in its processes, and eliminating any non-FSC/PEFC paper products that remain in its operations.

Action	Geography	Consumption reduction
Server switch	Spain	-68 MWh since 2021
Energy Optimisation Programme	UK	-2,600MWh

Refrigerant gases

The figures relating to refrigerant gases correspond to leaks of F-gases due to breakdowns of HVAC systems in corporate buildings and branches.

In Spain, to mitigate these leaks, every year the Bank conducts a scheme to upgrade its air conditioning equipment, which consists of:

• Increasing the number of annual reviews of each machine
• Establishing a machine upgrade plan, prioritising machines according to their age, the number of prior incidents, performance requirements, etc.

Action	Geography	Reduction of refrigerant gas leaks
HVAC Renewal Plan ("Plan Renove Clima")	Spain	-327 kg vs 2023

Company vehicles

During 2024, work continued in Spain to promote the use of energy-efficient vehicles through the company cars plan for executives. Similarly, in the UK, TSB continued to promote sustainable business travel options, offering only electric vehicles in its company cars plan.

Action	Geography	% of fleet 2023	% of fleet 2024	Change
TSB electric vehicles	UK	88%	93%	+5%
Action	Geography	No. of new points	Total no. of points	Change
Installation of new electric/hybrid vehicle charging points	Spain	44	83	+112.8%

Scope 2 - Indirect emissions

This scope includes emissions generated by the consumption of electricity.

In all of the geographies in which Banco Sabadell Group carries out its activity, 100% of the electricity acquired for use in its facilities has a renewable origin certification.

In Spain, additionally, the Institution has solar panels that generate 1.50% of the electricity consumed in that geography. In addition, the capacity of those solar panels was increased during 2024, in order to triple their current electricity production.

Electricity consumption	2024	2023	Estimated energy use savings (kWh)
Consumption of energy provided by Cepsa, 100% REGO (% supplied out of total electricity consumed)	98.50%	98.77%
Consumption of electricity provided by other resellers without REGO (% supplied out of total electricity consumed)	0	0
Spain - Self-generation of electric power through solar panels	1.5%	1.2%	637,850

In addition, in Spain the Bank continues with its ongoing consumption assessment programme at its branches and corporate buildings to detect changes and actions that will help to improve consumption efficiency:

• The project to replace the lighting at branches with Light Emitting Diode (LED) technology continues, to ensure that they are all are equipped with LED lighting and thus reduce consumption (all corporate buildings are already 100% equipped with LED lighting).
• The majority of the branch network is equipped with a centralised low energy consumption HVAC and lighting system, as well as light activation systems for billboard advertising adapted to daylight hours.
• Corporate buildings are equipped with motion-sensitive lighting systems and LED lights. In these corporate buildings and larger branches, HVAC installations are equipped with energy recovery systems.

Action	Geography	Potential energy impact
Expansion of photovoltaic power plant (CBS Sant Cugat building)	Spain	Production of 1,700 MWh per year

In the United Kingdom, TSB set itself a corporate objective of reducing its overall scope 1 and 2 emissions by 2% compared to the levels in 2023. As at the end of 2024, this reduction stood at -14.5%.

Scope 3 - Other indirect emissions

This scope includes other indirect emissions registered in the following categories:

• 1 Purchased goods and services (water, paper plastic)
• 5 Waste generated in operations
• 6 Business travelling
• 7 Employee commuting

This section does not consider category 15 - Financed emissions, as those details are provided in section 5.1.5.3 of this document.

The remaining scope 3 categories have not been considered material for the purposes of disclosing their emissions.

Purchased goods and services

In relation to eco-efficiency measures, since 2019 the Bank has taken several actions. Among others, bathroom facilities and taps are fitted with water-saving mechanisms. In addition, the headquarters in Sant Cugat del Vallés have a deposit that collects rainwater and greywater for reuse as irrigation water. At the same time, the landscaped areas are comprised of native plants with low irrigation needs.

Water management actions	Geography	Impact on water consumption
Reuse of greywater for third use in irrigation
Reduction of landscaped areas and		Use of up to 90% of greywater and potential 40% reduction of
improvement of irrigation systems in CBS	Spain	consumption used to water lawns
Sant Cugat

In terms of paper consumption, the Group has continued with the programme to reduce correspondence and simplify contractual documentation, helping to reduce paper consumption. This programme started in 2019, gradually digitalising the profile of customers and consolidating the model under which a single monthly account statement is sent to them.

Paper consumption actions	Perimeter	Consumption reduction vs 2023
Simplification of pre-contractual and contractual documents
Digital solutions for transaction signing, issuance of certificates and correspondence	Spain	-57 tonnes
Digitalisation of internal operating processes
Digital solutions for transaction signing, issuance of certificates and correspondence	UK	-8 tonnes

On the other hand, the Bank has been applying a series of measures since 2020 designed to eliminate plastic in the products it purchases for various uses:

Plastic consumption actions	Perimeter	Consumption reduction since 2019	Consumption variation since 2023
Elimination of plastic in certain desk and/or common use materials Elimination of coin blister packs Elimination of blue bag for documents requiring urgent digitalisation Elimination of passbook covers Replacement of the plastic film in blue event bags with brown kraft paper Replacement of plastic coffee spoons with wooden spoons Replacement of plastic window in envelopes with transparent paper window Manufacture of cash transfer bags with a mixture of recycled (80%) and virgin (20%) plastic Manufacture of shrink film from 56% sugar cane (organic material)	Banco Sabadell Group	-95.8% (-68.1 tonnes)	+2.5% (+0.1 tonnes)
Replacement of corporate pens (100% plastic) with an alternative manufactured with kraft paper and wheatpaste

Plastic consumption has increased slightly since 2023, due to an increased use of materials derived from commercial activity.

Waste generated in operations

Waste can be classified as either non-hazardous waste or hazardous waste. Non-hazardous waste includes scrap metal, inert plastic, bulky general waste, incandescent light bulbs, paper and cardboard, glass, organic waste, grease trap and wood. Hazardous waste includes chemical containers, absorbents (filters), lead batteries, oils, fluorescent lamps, electronic equipment, batteries and aerosols.

The Group has internal procedures in place to ensure that 100% of paper and plastic waste is removed and recycled by authorised waste management firms. Corporate buildings and branches are equipped with facilities for the separation and collection of packaging, organic matter and batteries.

Specific control mechanisms exist for waste management in branches due to be closed or merged. Surplus computer equipment and furniture in good condition at branches or work centres due to be closed or merged are donated by the Bank to NGOs and local charities.

The Bank has planned new actions designed both to reduce inorganic waste and to manage organic waste more efficiently:

Waste management actions	Geography	Estimated annual reduction of waste
New central waste disposal room
Installation of organic waste composting plant	Spain	2% per year

Business travelling

Company or business travel includes journeys by aeroplane, train and employees' personal vehicles.

At the start of 2020, before the State of Emergency was declared in Spain, the Bank reviewed its business travel policy, laying down new guidelines to limit travel to only journeys strictly necessary due to business needs and to prevent travel for internal meetings, encouraging the use of the remote and electronic solutions available.

It is for this reason that, compared to 2019, as a pre-pandemic reference year, the data for 2024 in Spain reflect the positive effect that the review of the Group's business travel policy has had on the reduction of the Institution's carbon emissions, recording a -42.8% reduction of emissions between both periods.

Employee commuting

Since 2023, the Bank has been calculating the emissions generated during commutes to the corporate buildings with the largest number of employees in Spain.

As regards these journeys, a sustainable mobility model will continue to be promoted with various schemes, such as the creation of new parking spaces at corporate buildings for private electric vehicles. In addition, TSB has undertaken to promote new alternative means of transport, such as the inclusion in company benefits of an additional grant for the purchase of electric bicycles, as well as new ways of working to keep reducing emissions.

Other actions

In Spain, during 2024 the Bank continued to certify its main corporate buildings with ISO 14001:2015.

Moreover, to mitigate the environmental impact of its suppliers, the Bank continues to encourage the use of electric vehicles for the various logistics services and the use of environmentally friendly ink among the printing companies that collaborate with the Bank.

Loan book

The Bank evaluates the impact of its loan book with two different assessments. The first consists of measuring the loan book's climate-related and environmental risk, while the second focuses on measuring the portfolio's carbon footprint.

The first type of assessment focuses on measuring the climate-related and environmental risk of the borrowers receiving finance. There are two approaches to this measurement:

• a. The measurement of climate-related and environmental risk in the loan book follows a bottom-up approach for large corporates through the advanced IRCA.
• b. The second approach, applied to smaller companies and retail customers and which is outside the scope of the advanced IRCA, is based on large-scale measurements made by the Bank using climate risk and environmental degradation risk models with a top-down methodology. In addition, to ascertain the impact of the portfolio under stress in different scenarios, various stress tests are conducted.

It is worth noting that, during 2024, the Institution has significantly improved this methodology, designing an assessment model, called the automated IRCA, to measure and score the environmental performance of companies that are under no obligation to publish non-financial disclosures or which do not currently have an advanced IRCA analysis. This model keeps the same consistency, approach and structure as the IRCA methodology that is already being applied to counterparties subject to the European sustainability reporting directive, but it makes it possible to obtain a preliminary estimate of the assessment of the climate-related and environmental risks of the entire business portfolio, considering the data already available in the Institution's systems (e.g. counterparty's location, company's activity). Although this is a simple approach compared to the advanced IRCA, it nevertheless provides this preliminary assessment of the portfolio without the need for an indepth assessment or for the involvement of specialist analysts.

The second type of assessment carried out by the Bank consists of measuring the emissions of the financed credit portfolio. This measurement is vital when it comes to managing ESG risk, as it is a quantitative metric for which a standardised methodology exists, offering comparability. Furthermore, this measurement is carried out for the entire loan book, in other words, not only for loans granted to companies, but instead also measuring emissions of other portfolios such as that of mortgages, sovereign bonds, auto loans and project finance.

Climate-related and environmental performance of the loan book

All transactions, companies and corporate groups submitted to or revised by the Delegated Credit Committee have an advanced ESG analysis.

Efforts have been made to translate this advanced analysis of large firms into a quantitative Climate-related and Environmental Risk Indicator (IRCA, by its Spanish acronym). The advanced IRCA gives an integrated evaluation of borrowers' exposure to climate-related physical and transition risks, taking into account the level of maturity of their management of these ESG aspects, the environmental degradation risk and any disputes that it is thought could affect compliance with sectoral standards or the Bank's reputation.

This indicator makes it possible to improve the screening of borrowers according to climate-related and environmental risks, as although the risks inherent in each borrower's activity are taken into account, these are adjusted based on the ESG management maturity analysis, which evaluates different factors such as the decarbonisation strategy, changes in the volume of emissions, ESG risk management and commitments to reduce emissions.

Measurement of borrowers' climate-related and environmental risk

The advanced IRCA objectively ranks large corporates using sustainability information, based on their exposure to climate-related and environmental degradation risks, and according to their maturity in terms of managing those risks. In line with this description, three main modules can be identified:

• 1. Climate risk: each borrower is assigned a score for the transition risk and physical risk inherent in their activity. To separate different borrowers within a given sector according to their management maturity level, ESG analysts evaluate the efforts made to transition and to mitigate physical risks, applying an internal methodology that has been standardised in order to make the results comparable. This way, the climate risk associated with a given activity by default can be adjusted based on each analysed borrower's level of maturity in managing those aspects. Looking at the evaluation in further detail:
  2. 1.1.Transition efforts are measured using a methodology that measures the management maturity of these aspects, in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), meaning that this part of the analysis evaluates topics aligned with the four thematic areas defined in the recommendations: Governance, Risk management, Strategy, and Metrics and targets.
  3. 1.2.The efforts made to mitigate physical risks are also measured following the TCFD recommendations, requesting details of any physical events experienced by the borrower and of the measures taken to mitigate risks and adapt to physical events (e.g. insurance). A big step forward has been taken in relation to this measurement (as mentioned in the heading "Physical climate risks"), defining a bottomup analytical methodology for large corporates, to be conducted by the ESG pool.
• 1. Environmental degradation risk: a module has been introduced to adjust borrowers' climate risk according to the impact inherent in the other environmental factors, other than climate factors, of the activities they perform. The adjustment stemming from this risk can be broken down to ascertain the impact associated with each vector (air quality, water quality, land quality, waste and biodiversity).

• Disputes: lastly, the counterparty's score based on environmental modules (climate and environmental degradation) undergoes a second adjustment to determine the presence of any significant disputes in connection with counterparties relating to the environment and also relating to social or governance aspects.

This methodology results in a numerical indicator that can be used to rank companies according to their ESG score in a uniform, objective and comparable way.

Lower scores correspond to higher climate-related and environmental risk, while higher scores are assigned to companies engaging in activities with a low (or even positive) impact on climate and the environment, as well as those with high ESG performance and/or maturity levels.

It is also worth noting that the modular structure of the IRCA also allows scores to be obtained separately for each module (climate, environmental degradation and disputes), so as to compare specific aspects of borrowers.

It is further worth mentioning that the advanced IRCA is integrated in an internal portal. This tool allows ESG analysts to work in a centralised way in a robust environment that improves the traceability and usability of the aforesaid information.

At present, the advanced IRCA has been calculated for large corporates in the case of almost half of the portfolio of loans granted to large corporates, and it is worth calling attention to the strong presence of borrowers with top-class ESG performance in their sector.

Lastly, to ensure that the advanced IRCA measurement is supervised, IRCA ratings are monitored, with reports submitted on a quarterly basis to the Bank's Sustainability Committee.

In terms of progress made during 2024, it is worth mentioning that the Institution has developed a new automatic rating method to measure and score the environmental performance of companies that are under no obligation to release non-financial disclosures or that currently do not have an advanced IRCA analysis such as the one mentioned previously.

The methodological process has been designed so that it follows the same modular and conceptual structure as the advanced IRCA. This way, an automated IRCA indicator has been established that measures climate-related and environmental risk using the same methodology as the IRCA for companies subject to the European sustainability reporting directive, adapted to the availability of information of companies that are under no obligation to release non-financial disclosures or that currently do not have an advanced IRCA analysis.

This methodology is already being applied by the Institution to assess the climate risks of portfolios not subject to the advanced IRCA or those that are subject to it but have not been rated. Furthermore, since it started to be applied, monitoring information on this automated IRCA has been reported to the Sustainability Committee on a quarterly basis.

Collection of information through a pool of ESG analysts

The pool in question is a centralised team of analysts specialising in ESG. The information collected mainly comes from public sources and is preferably checked and verified by a third party. In addition, where the ESG pool considers it necessary to do so, it instructs the basic management team to contact companies to obtain additional information.

This process takes place annually for existing customers and during the origination process in the case of new customers.

Lastly, as mentioned briefly in the introduction to this heading, the Bank complements the quantification of climate-related and environmental risks of borrowers outside the scope of the IRCA (mainly due to them being smaller-sized companies or retail customers) with the batch top-down analyses that it conducts for physical risk, transition risk and environmental degradation risk. These analyses have been explained previously in section 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities.

Initiatives to improve the quality of environmental information

Given the limited level of ESG reporting and disclosures by companies, as well as the lack of historical data and standardisation between the reported information and the monitoring metrics for these risks, it is crucial to have access to the best possible ESG data in order to identify, manage, classify and monitor risks associated with climate change.

For this reason, Banco Sabadell Group has been been taking various actions to increase the quantity and quality of ESG data about customers. There are two particular areas that are worth mentioning:

Real estate collateral: with the support of a third-party supplier, batch uploading processes of the energy ratings of residential real estate and Commercial Real Estate (CRE) of the portfolio are carried out. For newly granted mortgages, the Group captures this data upon origination. On the other hand, to calculate the carbon footprint of its residential and commercial real estate portfolio, the Bank has been working to gather information about actual useful surface areas of the assets it has financed (necessary to estimate the emissions attributable to each property).

Business risk: a task force was put together to gather environmental data from customers, as the first pilot project for the CO2 emissions-intensive portfolio, which included, among other things, the capture of actual emissions data (scope 1, 2 and 3) as well as additional data such as energy consumption, percentage of renewables consumption, emissions prevented (where applicable), external ESG ratings, environmental targets and Key Risk Indicators (KRIs) regarding the emissions intensity of each sector. Subsequently, efforts to improve information continued. On one hand, the calculation of the carbon footprint of the financed business portfolio involved gathering actual data of borrowers' emissions, as well as the information needed to calculate the attribution factor. On the other hand, for the 2024 climate stress test, data was gathered in relation to emissions (scope 1, 2 and 3) and decarbonisation targets of the Group's priority emissions-intensive customers.

In addition, using the IRCA created by ESG analysts, the task of collecting customers' ESG data got underway. However, at the start of the project and in order to start collecting information, a third-party supplier was hired to do the batch upload of ESG data about the main borrowers.

Similarly, due to the definition of the Bank's decarbonisation strategy, data was captured regarding the emissions, production and transition plans of the main borrowers affected by the pathways. First, attempts were made to obtain this information from public sources and, where that was not possible, customers were contacted to request that information.

Lastly, 2024 saw the continuation of the sectoral project between AEB (Spanish Banking Association), CECA (Spanish Confederation of Savings Banks) and UNACC (Spanish National Union of Credit Cooperatives) to collect information related to the taxonomy from borrowers. Specifically, an external consultant was hired to compile the eligibility and alignment indicators of borrowers that have this information publicly available. Furthermore, a methodology was defined on a sector-wide basis to process that data in order to ensure uniform reporting.

To complement this work to gather external information from customers, the Bank also works internally to centralise ESG information through a thematic sustainability datamart in order to provide a single point of access to all those who require it. To ensure the internal control of the information being managed, a person is appointed to be directly responsible for that information, and users of that information are also defined. Based on the assigned responsibilities, a series of tasks are established to ensure the quality and uniformity of the information.

5.1.5. Metrics and targets

5.1.5.1. E1-4: Targets related to climate change mitigation and adaptation

The Institution remains committed to attaining greenhouse gas emissions neutrality and it does this through two main courses of action. On one hand, the Institution is committed to neutralising the carbon footprint originated by its own operations, by reducing the scope 1, 2 and 3³² emissions through the decarbonisation levers

³² Excluding category 15: Investments

described next in this section. On the other hand, the Institution remains committed to decarbonising its balance sheet by reducing the carbon footprint of the portfolio.

Emission reduction targets of the loan book

In line with the commitments established by the NZBA, in December 2024, Banco Sabadell continued to move forward with its strategy to fight against climate change, setting decarbonisation targets for the following four new sectors: Residential mortgages, commercial real estate, aluminium, and maritime transport.

In the farming sector, the lack of robust methodologies and comparable data means that quantitative targets cannot be established. However, the Institution continues to assess its farming portfolio, focusing on customer engagement, and it will set decarbonisation targets once uniform data and suitable methodologies are available to carry out a sound assessment.

The new targets have been added to the first four decarbonisation targets published in December 2022 for the following sectors: Electricity (Power), Oil and Gas, Cement, and Coal Mining, and to those published in December 2023: Aviation, Automotive, and Iron & Steel, thereby covering all of the most carbon-intensive sectors of its loan book for which a target-setting methodology exists.

The activities covered by the aforesaid targets centre on the stage of each sector's production chain where transition is most likely to reduce the overall volume of greenhouse gas emissions.

With this goal in mind, commitments have been determined taking into account the Net Zero Emissions by 2050 (NZE2050) scenario published by the International Energy Agency (IEA), which establishes decarbonisation pathways for different sectors that are consistent with limiting the global temperature rise to 1.5°C above preindustrial levels. The commitments have been set based on the methodology of the Science-Based Targets initiative (SBTi) for all sectors except for electricity, residential mortgages and maritime transport (Alignment Delta). The affected customer segment is that of large corporates.

Sector	Value chain stage	Emissions scope	Reference scenario	Metric	Base year	Base year metric	Target 2030	% reduction
Power	Electricity generation	1 and 2	IEA Net Zero 2050	Physical intensity Kg CO2e/ MWh	2020	61	45-85
Oll & Gas	Upstream & Downstream (incl. refining)	1, 2 and 3	IFA Net Zero 2050	Absolute emissions Kt CO2e	2020	6,300	4.851	-23% vs 2020
Cement	Manufacture	1 and 2	IEA Net Zero 2050	Physical intensity Kg CO2e/ tonne cement	2020	660	510	-23% vs 2020
Coal	Mining activity	Not applicable	IEA Net Zero 2050	Exposure Million euros	2020	2.9	~O	-100% vs 2020
Iron & Steel	Manufacture	1 and 2	IEA Net Zero 2050	Physical intensity Kg CO2e/ tonne steel	2022	1,593	1,172	-26% vs 2022
Automotive	Manufacture / OEMs (4)	3	IEA Net Zero 2050	Physical intensity g CO2e/ vkm(2)	2022	211	124	-41 % vs 2022
Avlation	Airlines	1 and 2	IEA Net Zero 2050(3)	Physical intensity g CO2e/rpk(4)	2022	94	65	-31% vs 2022
Residential real estate mortgages	Owner	1 and 2	CRREM 1.5℃(5)	Physical intensity Kg CO2e/m²	2023	20.9	16.8	-20% vs 2023
Commercial real estate	Owner	1 and 2	CRREM 1.5ºC (6)	Physical intensity Kg CO2e/m²	2023	25.1	12.6	-51% vs 2023
Aluminium	Production	1 and 2	IAI 1.5°(7)	Physical intensity Kg CO2e/tonne aluminium	2023	645	549	-15% vs 2023
Maritime transport	Operator	1 and 3	IMO (8)	Alignment Delta (AD%)(9) Delta gCO2e/tnm(10)	2023	Delta +25%	Delta 0%
Farming				Analysis in progress: focus on customer engagement

Targets published as at December 2024

(1) OEM: Original Equipment Manufacturer. Scope 3 emissions are those linked to the use of sold vehicles (category 11 - Use of sold products). (2) vkm: vehicle kilometre.

(3) A correction factor has been added to the scenario to remove the distortion caused by Covid-19 in the forecast data for the 2019-2030 period, due to the reduced aircraft occupancy rate during the pandemic.

(4) rpk: revenue passenger kilometre.

(5) CRREM: Carbon Risk Real Estate Monitor for Spain and Portugal, specific to the residential real estate sector for the EU.

(6) CRREM: Carbon Risk Real Estate Monitor for Spain and Portugal, adapted to proportions per type of asset in the stock of non-residential properties. (7) Decarbonisation trajectory determined by the International Aluminium Institute (IAI) for recycled aluminium.

(8) International Maritime Organisation.

(9) Annual Efficiency Ratio (AER), which measures the efficiency of a vessel's carbon emissions associated with its transport work over a one-year period, representing the grams of CO2 emitted per tonne-nautical mile (gCO2/tnm) and per tonne of cargo transported (gCO2t). Alignment Delta (AD%), a metric that measures the extent to which the carbon emissions intensity of a vessel or portfolio of vessels is aligned with the underlying decarbonisation trajectory for each type of asset that meets the target of the International Maritime Organisation. (10) tnm: tonne-nautical mile.

In August 2023, the UK subsidiary, TSB, published specific targets for its residential mortgage book.

Sector	Value chain stage	Emissions scope	Reference scenario	Metric	Base year	Base year metric	Target 2030	% reduction vs base year
Residential mortgages	owners	1 and 2	IEA ETP B2DS(1)	Physical intensity Kg CO "/m²	2022	20.14	11.75	-42% vs 2022

(1) International Energy Agency's Below 2 Degrees Scenario.

Monitoring of decarbonisation targets

Sector	Value chain stage	Emissions scope	Metric	Base year	Base year metric	2023	2030 reduction target	0/0 reduction	% reduction base year vs 2023
Power	Electricity generation	1 and 2	Physical intensity Kg CO3e / MWh	2020	61	63	<85	-	Remains in range
Oll & Gas	Upstream & Downstream (incl. refining)	1, 2 and 3	Absolute emissions Kt CO ,e	2020	6,300	4,820	4,851	-23% vs 2020	-23%
Cement	Manufacture	1 and 2	Physical intensity Kg CO ,e / tonne cement	2020	660	609	510	-23% vs 2020	-8%
Coal	Mining activity	Not applicable	Exposure Million euros	2020	2.9	0.1	~0	-100% vs 2020	Remains at values close to target
Iron & Steel	Manufacture	1 and 2	Physical intensity Kg CO2e/tonne iron	2022	1,593	1,497	1.172	-26% vs 2022	-6%
Automotive	Manufacture / OEMs	3	Physical intensity g CO2e/vkm(1)	2022	211	220	124	-41% vs 2022	+4%
Avlation	Airlines	1 and 2	Physical Intensity g CO2e/rpk(2)	2022	04	90	65	-31% vs 2022	-4%

Notes about methodology applied:

Pathway evolution calculated based on customer exposure as at year-end and on counterparties' most recent data available in the first quarter of 2024. It is worth noting that the decarbonisation targets for 2030 do not assume a linear reduction in the intervening years, meaning that fluctuations in value may occur during these years but should not be interpreted as a failure to meet the target.

(1) vkm: vehicle kilometre.

(2) rpk: revenue passenger kilometre.

In relation to the achievement of the established targets, where a significant transaction is identified that meets the requirements that make it subject to the pathway, an ad hoc analysis is carried out to quantify its impact on the pathway and to ensure that the stipulated limits are observed and that achievement of the 2030 target is not put at risk. Specifically, a team of specialists reviews (i) the physical intensity of the customer's emissions (absolute emissions, if applicable) to analyse their existing situation, and (ii) the customer's future commitments, to determine their transition efforts.

In addition, the Bank applies its decarbonisation strategy ensuring various levers depending on the circumstances of the sector and of the customers themselves. Specifically it focuses on:

• Electricity (Power): maintaining a leading position in renewable project finance and promoting the development of new technologies as an alternative to the use of fossil fuels.
• Oil & Gas: taking actions to help customers reduce their emissions, offering finance for investment plans linked, for example, to the development of synthetic fuels or to the transformation of the production model.
• Cement: the main decarbonisation focus area involves helping customers reduce their emission intensity, driving the transformation of their production models.
• Coal: although the Bank's portfolio is residual, it remains firmly committed to phasing out its exposure to companies in this sector, applying restrictions to the approval of new transactions.
• Iron & Steel: focusing on helping customers to improve the energy efficiency of their production process and to drive the circular economy, with increased use of scrap metal as a raw material.
• Automotive: support customers as they transition towards electrification, the development of synthetic fuels for combustion engine vehicles and the optimisation of fuel/energy per kilometre travelled.
• Aviation: supporting customers in the use of Sustainable Aviation Fuels (SAF), improvements in aircraft and engines, fleet upgrades, and operational optimisation.

It is worth mentioning that the Bank will continue to finance the transition of companies that take action to adapt to a low-carbon economy and whose ESG performance is in line with the Bank's expectations for each sector.

For further details about the sector-specific decarbonisation levers and the methodology used to set targets, see the Decarbonisation Targets report included on the corporate website, in the section on sustainability, available at https://www.grupbancsabadell.com/corp/en/sustainability/commitment-to-sustainability.html.

The Institution's decarbonisation targets

With a firm resolve to support and accelerate economic and environmental transformations, in 2021 Banco Sabadell undertook the commitment to achieve a carbon footprint reduction by 2025, taking 2019 as the base year, of 14.2% for its scope 1 and 2 emissions, and of 48.3% for its scope 3 emissions (except category 15).

The Institution is working to establish, from 2025 onwards, new reduction targets for 2030, which will be publicly disclosed in next year's Sustainability Report.

Spain

The following table shows the targets for Spain and the changes that have taken place since the base year 2019:

	Base year 2019
CO2 emissions reduction targets in Spain	Target 2025	% achieved 2024
Scope 1 & 2, market-based	-14.2%	-57.5%
Scope 3, market-based	-48.3%	-41.8%
Total reduction, market-based	-36.1%	-47.4%

To achieve the indicated targets, the Bank has identified certain key levers to reduce its consumption-related emissions considered to be material for each scope, considering in each lever the actions that will allow the established reduction targets to be met.

In this respect, for scope 1, the Bank considers material emissions to be mainly those stemming from refrigerant gas leaks.

For scope 3, in terms of its own operations, the material categories with the biggest emissions in tonnes of CO2e correspond to business travel and employee commuting. Emissions stemming from employee commuting between their home and the workplace began to be calculated and disclosed in 2023, so they were not included in the reduction commitment for 2025 vs base year 2019.

Potential contribution of actions currently being taken by Banco Sabadell to reduce CO2e emissions in Spain

The emissions target for 2025, on a like-for-like basis with the types of emissions calculated in 2019, is 5,576 tCO2e, corresponding to a reduction of -36.2%. If we include emissions from employee commuting, calculated as from 2023, the emissions target for 2025 rises to 7,739 tCO2e.

The following table shows the key aspects considered in the action plan to reduce emissions by 2025:

Emissions	tCO2e base year 2019	% annual reduction	Key aspects to consider in action plan
			• Increase in maintenance services
Refrigerant gas leaks	2,091	-12.5%	• Investment in HVAC equipment upgrades, prioritising less efficient and older equipment
Business travel	4,330	-8.6%	• Rationalise travel, encouraging the use of remote tools
			• Promote the use of sustainable transport

TSB (United Kingdom)

The following table shows the 2030 targets for TSB (UK) in relation to the base year 2023:

CO2 emissions reduction targets in UK	Target 2025	% achieved 2024	2030 science-based targets
Scope 1	-21.3%	-22%	-65%
Scope 3 (paper), market-based	-	-	-42%
Scope 3 (business travel, commuting and teleworking), market-based	-	-	-42%

To achieve the stated targets, TSB has identified certain key actions that form part of the plan to reduce its most significant scope 1 emissions (gases, refrigerant gas leaks, and travel using Bank-owned vehicles) and scope 3 emissions (paper consumption, business travel, and employee commuting to the work centre).

Emissions	tCO2e base year 2023	Annual average reduction %	Key initiatives to consider in action plan
Fossil fuel gases and refrigerant gas leaks	1,410	-9.3%	Removal of gas and electrification of infrastructure, using smart technology to monitor systems remotely
			Digital correspondence intray in online banking
Paper consumption	658	-6.0%	Digital signature to open savings accounts and sign up for payment services
			Adapt company travel policy for more sustainable and efficient use
Business travel and employee commuting	5,016	-6.0%	Promote the use of sustainable transport for business trips
			Organise staff awareness-raising programmes and encourage the use of shared vehicles

5.1.5.2. E1-5: Energy consumption and mix

Fossil fuels consumption

The consumption of natural gas in Spain is limited to three of the corporate buildings. It is used to reinforce the HVAC system, both to provide heat and for dehumidification purposes. Continuous efforts are made to ensure systems are correctly maintained to deliver optimal consumption efficiency. In the United Kingdom, natural gas is mainly used in winter throughout the entire branch network and also in corporate buildings. No natural gas is consumed in Mexico or the USA, as their HVAC systems run entirely on electricity.

In terms of the consumption of diesel, in Spain, Banco Sabadell's physical switch between data centres was completed between 2022 and 2023, moving from its own facilities to those of its technological infrastructure provider, resulting in an overall consumption reduction of -68MWh compared to consumption in 2021.

Renewable energy consumption

In all of the geographies in which Banco Sabadell Group carries out its activity, practically 100% of the electricity acquired for use in its facilities has a renewable origin certification.

The following table shows the energy consumption in 2023 and 2024 for Banco Sabadell Group, as well as the proportion of fossil fuels and renewable sources:

Energy consumption and mix, Banco Sabadell Group	2023	2024
Total fossil fuels consumption (MWh)	8,958	8,532
Share of fossil sources in total energy consumption (%)	12.2%	13.1%
Consumption from nuclear sources (MWh)	0	0
Share of consumption from nuclear sources in total energy consumption (%)	0%	0%
Consumption from renewable sources (MWh)	0	0
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh)	63,623	55,972
Consumption of self-generated non-fuel renewable energy (MWh)	615	638
Total renewable fuels consumption (MWh)	64,238	56,610
Share of renewable sources in total energy consumption (%)	87.8%	86.9%
Total energy consumption (MWh)	73,197	65,141

Spain

In Spain, the Institution has solar panels that generate 1.50% of the electricity used in this geography, allowing the Bank to reduce the electric power that it acquires from its usual reseller to 98.79%. In addition, the capacity of those solar panels has been increased during 2024, in order to triple their current electricity production, further reducing the volume acquired from the reseller.

Energy consumption and mix	2023	2024
Total fossil fuels consumption (MWh)	2,142	2,933
Share of fossil sources in total energy consumption (%)	4.1%	6.3%
Consumption from nuclear sources (MWh)	0	0
Share of consumption from nuclear sources in total energy consumption (%)	0%	0%
Consumption from renewable sources (MWh)	0	0
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh)	49,463	43,323
Consumption of self-generated non-fuel renewable energy (MWh)	615	638
Total renewable fuels consumption (MWh)	50,078	43,961
Share of renewable sources in total energy consumption (%)	95.9%	93.7%
Total energy consumption (MWh)	52,220	46,895

TSB (United Kingdom)

TSB completed the third phase of its Energy Optimisation Programme, which helped to reduce the locationbased energy consumption of natural gas, diesel and electricity by -2,600 MWh compared to 2023.

Energy consumption and mix	2023	2024
Total fossil fuels consumption (MWh)	6,666	5,598
Share of fossil sources in total energy consumption (%)	33.8%	32.7%
Consumption from nuclear sources (MWh)	0	0
Share of consumption from nuclear sources in total energy consumption (%)	0%	0%
Consumption from renewable sources (MWh)	0	0
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh)	13,045	11,550
Consumption of self-generated non-fuel renewable energy (MWh)	0	0
Total renewable fuels consumption (MWh)	13,045	11,550
Share of renewable sources in total energy consumption (%)	66.2%	67.4%
Total energy consumption (MWh)	19,710	17,149

Mexico

The Institution's facilities in Mexico only use electric power, which has a Renewable Energy Guarantee of Origin (REGO), with no need to consume any energy created from fossil fuels.

Energy consumption and mix	2023	2024
Total fossil fuels consumption (MWh)	0	0
Share of fossil sources in total energy consumption (%)	0%	0%
Consumption from nuclear sources (MWh)	0	0
Share of consumption from nuclear sources in total energy consumption (%)	0%	0%
Consumption from renewable sources (MWh)	0	0
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh)	417	368
Consumption of self-generated non-fuel renewable energy (MWh)	0	0
Total renewable fuels consumption (MWh)	417	368
Share of renewable sources in total energy consumption (%)	100%	100%
Total energy consumption (MWh)	417	368

USA

In Miami, the two corporate buildings (Miami Lakes Operating Center and Sabadell Financial Center) only use electric power, including for heating and cooling purposes throughout the year. Furthermore, the electric power that they consume has a Renewable Energy Guarantee of Origin (REGO).

Energy consumption and mix	2023	2024
Total fossil fuels consumption (MWh)	0	0
Share of fossil sources in total energy consumption (%)	0%	0%
Consumption from nuclear sources (MWh)	0	0
Share of consumption from nuclear sources in total energy consumption (%)	0%	0%
Consumption from renewable sources (MWh)	0	0
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources (MWh)	698	730
Consumption of self-generated non-fuel renewable energy (MWh)	0	0
Total renewable fuels consumption (MWh)	698	730
Share of renewable sources in total energy consumption (%)	100%	100%
Total energy consumption (MWh)	698	730

5.1.5.3. E1-6: Gross Scopes 1, 2, 3 and Total GHG emissions

The CO2 emissions released by the Group in the geographies in which it is present (Spain, United Kingdom, Mexico and USA) amounted to 13,082.48 tonnes³³, according to marked-based data, recording a change of +23.2% compared to 2023. The reason for that increase was the expanded perimeter in TSB (UK) in 2024, which included the calculation of travel whilst commuting and teleworking, which amounted to 3,197 tCO2e. The change in the footprint for 2024 compared to 2023, on a like-for-like basis, is a reduction of -33.2%.

Banco Sabadell Group (all geographies)	Base year34	Comparison (2023)	N (2024)	% N/ N-1	Target year35	Annual % target vs base year36
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO2e)	4,523	3,243	2,460	-24.1%	3,170	—%
% of scope 1 GHG emissions from regulated emission trading schemes	0	0	0	0	-	0
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO2e)	18,164	16,825	14,112	-16.1%	16,368	—%
Gross market-based scope 2 GHG emissions (tCO2e)	18	0	25	0	0	—%
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO2e)	11,308	11,537	10,597	-8.1%	8,059	—%
Purchased goods and services
Water	171	109	101	-7.4%	150	—%
Paper	1,475	1,121	1,242	10.8%	816	—%
Plastic	221	9	9	—%	13	—%
Waste generated in operations	94	88	120	36.8%	74	—%
Business travel	5,185	3,886	4,058	4.4%	5,137	—%
Employee commuting	4,161	6,324	5,067	-19.9%	1,869	—%
Total GHG emissions
Total GHG emissions (location-based) (tCO2e)	33,995	31,605	27,169	-14.0%	19,049	—%
Total GHG emissions (market-based) (tCO2e)	15,849	14,780	13,082	-11.5%	7,446	—%

³³ Does not include the footprint generated by real estate assets that have been leased out, estimated at 331 tonnes of CO2e, which would correspond to 2.5% of the Group's total carbon footprint

³⁴ The base year corresponding to Spain's tCO2e is 2019, while for the UK it is 2023. The base year is not included for Mexico or the USA, as these geographies have not yet set any carbon footprint reduction targets

³⁵ The target year corresponding to Spain's tCO2e is 2025, while for the UK it is 2030. The target year is not included for Mexico or the USA, as these geographies have not yet set any carbon footprint reduction targets

³⁶ See targets for each geography in section "Carbon footprint, by geography". In this table, generally the % annual reduction vs base year required to achieve the targets is not indicated, as not all geographies have established targets and those geographies that do have carbon footprint reduction targets do not all have the same the base year and target year

Carbon footprint, by geography³⁷:

Spain	Base year (2019)	Comparison (2023)	N (2024)	% N/ N-1	2025	Annual % target vs base year
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO2e)	3,113	1,768	1,331	-24.7%	2,677	-2.3%
% of scope 1 GHG emissions from regulated emission trading schemes	0	0	0	0	-	0
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO2e)	15,436	13,650	11,264	-17.5%	16,368
Gross market-based scope 2 GHG emissions (tCO2e)	18	0	0	0	0	-100%
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO2e)	5,607	5,152	5,150	—%	4,769	-2.5%
Purchased goods and services
Water	157	93	84	-8.9%	150	-0.7%
Paper	818	463	595	28.3%	435	-7.8%
Plastic	221	9	9	—%	13	-15.7%
Waste generated in operations	81	75	116	54.9%	74	-1.4%
Business travel	4,330	2,348	2,476	5.4%	2,228	-8.1%
Employee commuting38		2,163	1,869	-13.6%	1,869	—%
Total GHG emissions
Total GHG emissions (location-based) (tCO2e)	24,156	20,570	17,745	-13.7%	19,049	-3.5%
Total GHG emissions (market-based) (tCO2e)	8,738	6,920	6,481	-6.3%	7,446	-2.5%

United Kingdom	Base year (2023)	Comparison (2023)	N (2024)	% N/ N-1	2030	Annual % target vs base year
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO2e)	1,410	1,410	1,100	-22.0%	493	-9.3%
% of scope 1 GHG emissions from regulated emission trading schemes	0	0	0	—%	-	—%
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO2e)	2,728	2,728	2,417	-11.4%	-	—%
Gross market-based scope 2 GHG emissions (tCO2e)	0	0	25	—%	0	100% REGO
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO2e) Purchased goods and services	5,701	5,701	4,880	-14.4%	3,290 cat. 6-7 and paper	-4.6%
Water	14	14	11	-21.6%	-	—%
Paper	657	657	647	-1.6%	381	-6.0%
Plastic	0	0	0	—%	-	—%
Waste generated in operations	13	13	4	-67.0%	-	—%
Business travel	855	855	1,020	19.3%		-6.0%
Employee commuting	4,161	4,161	3,197	-23.2%	2,909	—%
Total GHG emissions
Total GHG emissions (location-based) (tCO2e)	9,839	9,839	8,396	-14.7%	-	—%
Total GHG emissions (market-based) (tCO2e)	7,111	7,111	6,004	-15.6%	-	—%

³⁷ The emission factors applied were updated during 2024 by various official institutions and/or internationally recognised organisations. In the case of Spain, the emission factors correspond to Oficina Catalana pel Canvi Climàtic (2024 edition), with the exception of those associated with cars, for which DEFRA 2024 factors were used. In the case of the United Kingdom and Mexico, emission factors correspond to DEFRA 2024. In the case of the USA, emission factors correspond to those published by the US Environmental Protection Agency and by DEFRA

³⁸ In Spain, the carbon footprint generated during commutes is calculated for the corporate buildings with the largest number of employees in Spain. Total emissions calculated in this category for Spain corresponding to 2024 came to 1,869.48 tonnes of CO2e

Mexico39	Base year	Comparison (2023)	N (2024)	% N/ N-1	Target year	Annual % target vs base year
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO2e)		63	29	-54.0%
% of scope 1 GHG emissions from regulated emission trading		0	0	0
schemes
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO2e)		182	161	-11.5%
Gross market-based scope 2 GHG emissions (tCO2e)		0	0	0
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO2e)		339	270	-20.4%
Purchased goods and services
Water		2	4	108.0%
Paper		0	0	—%
Plastic		0	0	—%
Waste generated in operations		0	0	—%
Business travel		337	265	-21.3%
Total GHG emissions
Total GHG emissions (location-based) (tCO2e)		584	460	-21.3%
Total GHG emissions (market-based) (tCO2e)		402	299	-25.7%
USA40	Base year	Comparison (2023)	N (2024)	% N/ N-1	Target year	Annual % target vs base year
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO2e)
		2	0	-100.0%
% of scope 1 GHG emissions from regulated emission trading
schemes		0	0	0
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO2e)		265	270	1.8%
Gross market-based scope 2 GHG emissions (tCO2e)		0	0	0
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO2e)		345	298	-13.5%
Purchased goods and services
Water		0	1	—%
Paper		0	0	—%
Plastic		0	0	—%
Waste generated in operations		0	0	—%
Business travel		345	297	-14.0%
Total GHG emissions
Total GHG emissions (location-based) (tCO2e)		612	568	-7.2%

Emissions of the financed portfolio

Emissions of the financed portfolio account for the largest share of the Group's emissions. Therefore, since 2021, Banco Sabadell Group has calculated the carbon footprint of its financed portfolio using the Partnership for Carbon Accounting Financials (PCAF) methodology. PCAF is a global partnership of financial institutions that work together to develop and implement a global harmonised approach to measure and disclose the emissions associated with their loans and investments.

³⁹ Mexico has not established carbon footprint reduction targets, so no data is included in relation to the base year, target year or annualised % of target

⁴⁰ The USA has not established carbon footprint reduction targets, so no data is included in relation to the base year, target year or annualised % of target

As part of this partnership, 16 institutions established the design of the Global GHG Accounting and Reporting Standard for the Financial Industry, which aims to harmonise greenhouse gas emissions accounting. Banco Sabadell became a member of the PCAF in June 2022. The measurement of the financed portfolio's emissions using this Standard is a key step for financial institutions to assess the transition risks associated with climate change, set targets aligned with the Paris Agreement and develop effective strategies to decarbonise the economy.

As regards the PCAF methodology, Banco Sabadell Group has applied the methodology envisaged in the Standard mentioned above, which has been devised mainly for financial institutions that want to measure and share their GHG emissions financed through their loans and investments, and which allows the following asset classes to be measured:

• Business loans and unlisted equity.
• Project finance.
• Commercial Real Estate (CRE) mortgages.
• Residential mortgages.
• Motor vehicle loans.
• Sovereign bonds (new category in 2023).

It is worth mentioning that the PCAF has two methodological approaches for listed equity and corporate bonds. In this case, the Bank uses the same methodology that it does for business loans and unlisted equity, in which the attribution considers counterparties' balance sheet data. The other approach, based on companies' stock market valuations, is not applied in this case given the volatility generated by the attribution factor.

Based on this methodology, the Group has calculated its carbon footprint (scope 1 and 2) as at 2024 year-end for approximately 97% of its financed portfolio. The portfolios not calculated are those for which no calculation or estimation standards or methodologies exist as yet, such as the financing of consumer loan portfolios for purposes other than vehicle purchase or private banking, among others.

It is worth noting that during 2024 the Group has continued to improve its calculation model through a process of ongoing improvement, to obtain more reliable and complete results. The following improvements are particularly worth mentioning:

i) Calculation of the new Sovereign Bonds segment of the portfolio within the model used to calculate the carbon footprint, following the new methodology published by the PCAF.

ii) Inclusion of fixed-income contracts for corporate bonds in the business segment.

iii) Inclusion of new PCAF emission factors in the calculation of emissions stemming from the financed business portfolio.

iv) Improved Data Quality (DQ) with actual data for emissions and surface areas, as well as actual and estimated EPC ratings from appraisal firms, in addition to data on the value and type of vehicle.

v) Update of emission factors for non-renewable energy projects, by geography, based on official sources and update of PCAF factors.

To ensure that the carbon footprint of the financed portfolio is monitored and supervised, since September 2022 the emissions arising from the loan portfolio have been monitored on a quarterly basis and reported to the Sustainability Committee and to the Technical Risk Committee⁴¹ .

⁴¹ Details of the attributions of management bodies in climate-related matters are provided in chapter 2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies

The absolute emissions of the Group's financed portfolio in terms of scope 1 and 2 as at the end of 2024 came to 15.31⁴² million tCO2e, which, considering the emission intensity value calculated using the standard measurement in the sector, which is per million euros financed, represents an emission intensity of 78.05 tCO2e/€m with an average DQ of 3.28. To complement this, if one were to calculate an intensity of emissions financed based on net income⁴³, this would be 2,416 tCO2e/€m.

The segment that contributes the most to the footprint is the business portfolio (approximately 57%), which represents 33% of the credit exposure in the portfolio, followed by sovereign bonds. Emissions increased compared to the end of 2023, while the intensity dropped slightly and the average DQ improved, thanks to the regular exercises carried out to obtain actual data from the various segments.

The sectors that contribute the most to the financed portfolio's footprint are Agriculture, forestry and fishing, Construction materials, the Steel industry and Maritime transportation. It is worth noting that the segment that remains the second-biggest contributor in 2024 is the segment corresponding to the issuance of sovereign bonds, which includes the LULUCF⁴⁴ factor. Details of the emissions of each PCAF segment are provided below:

SEGMENT	INTENSITY (tCO2/€m)	DQ
Business loans and unlisted equity	127	3.68
Project finance	90	3.86
Commercial Real Estate (CRE) mortgages	47	4.06
Residential mortgages (includes TSB)45	17	3.42
Motor vehicle loans	206	3.58
Sovereign bonds (new category in 2023)	145	1.04

The Bank is focusing its efforts on establishing decarbonisation targets for the most emissions-intensive sectors of its business portfolio (see section 5.1.5.1. E1-4: Targets related to climate change mitigation and adaptation). Each sector's emissions for 2024 are included in the Bank's latest Pillar 3 Disclosures report⁴⁶ .

On the other hand, the Bank is focusing its efforts on project finance for renewable energies, in order to promote the transition to a sustainable economy. These efforts are also reflected in the 2.15 million tCO2e of emissions prevented as a result of financing these types of projects.

To ensure that the carbon footprint of the financed portfolio is supervised, it is monitored on a quarterly basis and reported to the Bank's Sustainability Committee and to the Technical Risk Committee⁴⁷. In addition, the calculation of the financed portfolio's carbon footprint is audited every year, with the participation of an independent third party, obtaining favourable results.

5.1.5.4. E1-7: GHG removals and GHG mitigation projects financed through carbon credits

In 2024, Banco Sabadell renewed its commitment to offset its carbon footprint, including all scope 1, 2 and 3 emissions in Spain, Mexico and the USA, through the purchase of credits in various reforestation projects. In Spain, the project is located in Valle de Sedano⁴⁸, in the province of Burgos, where 169.42 hectares of scrubland are being reforested by changing the land use and introducing various native plants (pinus nigra, pinus sylvestris, quercus faginea, quercus ilex and crataegus monogyna). In addition, emissions will be offset by purchasing carbon credits in Mexico, specifically in a project located in Santiago de Papasquiaro⁴⁹, in the state

⁴² The previously reported data includes financed emissions and the emission intensity per million euros financed, as that is where the most significant emissions are found

⁴³ Estimates relate to the financed portfolio, as that is where the majority of a financial institution's emissions are concentrated. As an indicator of net income, the main metric of a financial institution's income, Gross Margin, has been selected. That indicator includes the following items: net interest income, fee and commission income, profit or loss on financial operations, other operating income and expenses, and income and expenses on assets and liabilities under insurance contracts

⁴⁴ Land Use, Land-Use Change and Forestry

⁴⁵ The data for coverage of emissions in TSB corresponds to 2023 year-end

⁴⁶ For more details about the emissions of the financed portfolio, refer to the latest Pillar 3 Disclosures report, which contains the emissions breakdown of each carbon-intensive sector, publicly available on Banco Sabadell's corporate website

⁴⁷ Details of the attributions of management bodies in climate-related matters are provided in chapter "2.2 GOV-2: Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies"

⁴⁸ https://www.miteco.gob.es/content/dam/miteco/es/cambio-climatico/temas/registro-huella/informes/2024-b338.pdf

⁴⁹ https://thereserve2.apx.com/mymodule/reg/prjView.asp?id1=1497

of Durango, whose main aim is to remove CO2 from the atmosphere through improved forest management, increasing the accumulation of forest carbon in the region with appropriate forestry work. Total CO2 emissions to be offset come to 7,078.24 tCO2 equivalent. The carbon credits acquired for offsetting correspond, in the case of Spain, to projects registered with the Ministry for Ecological Transition and the Demographic Challenge and, in the case of projects in Mexico, to those registered with the Climate Action Reserve, endorsed by the International Carbon Reduction and Offset Alliance (ICROA).

TSB, for its part, has offset its scope 1 and 2 emissions generated in 2024, which amounted to 1,124.62 tCO2e, through Forest Carbon's ArBolivia⁵⁰ reforestation/afforestation project (Plan Vivo), through which TSB has planted more than 52,000 trees and invested in forests, peatlands and woodlands in the United Kingdom to offset its future emissions.

The Group maintains its commitment to fight against climate change, embodied in its aim of achieving carbon emissions neutrality in its operations, which it undertook upon becoming a member of the Net-Zero Banking Alliance in 2021. It also maintains its GHG reduction targets described in section E1-4: Targets related to climate change mitigation and adaptation.

Carbon credits cancelled in the reporting year	2024	2023
Total (tCO2e)	8,203	9,079
Share from removal projects (%)	100%	100%
Share from reduction projects (%)	0%	0%
Recognised quality standard (%)	100%	100%
Share from projects within the EU (%)	73%	59%
Share of carbon credits that qualify as corresponding adjustments (%)	0%	0%

5.1.5.5 E1-8: Internal carbon pricing scheme

The Institution has established carbon pricing for emissions from its own operations, which materialises through the offsetting of emissions, maintaining the commitment to offset the carbon footprint including all scope 1, 2 and 3 emissions in Spain, Mexico and the USA and scope 1 and 2 emissions in TSB. The average cost of this offset was c.€21 per metric tonne of CO2e in 2024.

In addition, with regard to the financed portfolio, the Bank has several pricing mechanisms:

• Discounts are applied for transactions that are aligned with the Sustainable Financing Framework: discounts are applied to financing transactions, taking into account the project, the sector in which the activity or project takes place, and the environmental, social and governance impact.
  • Green and Social Loans (GSLs): a discount is applied to the final price of finance for eligible transactions/projects/investments that are aligned with the EU taxonomy and substantially contribute to any of the six taxonomy objectives. The destination of the funds must be traceable and there must be supporting documents and a measurement of the impact.
  • Sustainability-Linked Loans (SLLs) incentivise the achievement of sustainability targets, linking the transaction price to the evolution of certain KPIs. This category does not require the funds to be used for any specific purpose. It is considered essential that the selected indicators be relevant and central for customers, as this enables their sustainability strategy to gain more traction. Every year, customers (legal entities) measure their committed indicators or KPIs and send the evidence to the Bank. Provided that the committed thresholds are met, the Bank proceeds to apply the discount to the transaction.
• Similarly, to embed climate risks into credit risk, the Group has internally developed a methodology for the quantitative assessment of transition risks that is aligned with the three scenarios (Orderly

⁵⁰ https://mer.markit.com/br-reg/public/index.jsp?name=tsb

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Transition, Disorderly Transition and Hot House World) of the Network for Greening the Financial System (NGFS) and adapted to a time horizon of 30 years. These heatmaps, which are developed on a qualitative basis, enable the inclusion of transition risk drivers in the customer base. Accordingly, all the activities of the loan portfolio are classified according to their sensitivity to transition risk, taking into account the impacts envisaged in each scenario in terms of income, low-carbon capex and expenses. In the case of this last point, a direct cost is assigned or considered for greenhouse gas emissions. The estimated impacts of transition risk, together with an advanced assessment of counterparties' performance and attitude in relation to the management of these risks, all affect the Climate-related and Environmental Risk Indicator (CERI, or IRCA by its Spanish acronym), as this is a numerical indicator that allows the Bank to rank borrowers according to their impact associated with climate-related and environmental risk. It is worth noting that, at present, for the Large corporates and groups portfolio, the IRCA is embedded into the assessment of counterparties, generating, for companies with a low IRCA score, an impact on their rating, meaning that the assessment already includes a probability of default for each counterparty, with all that that entails.

5.2 Social: Own workforce

5.2.1 Introduction

Banco Sabadell has a committed and professional workforce that is dedicated to helping people and companies make the best economic decisions. The Bank has policies and procedures in place aimed at attracting and developing talent, promoting the commitment of its workforce and fostering diversity and inclusion.

Banco Sabadell's culture hinges on the watchword "Being Sabadell", encapsulating a way of doing things and of being that is unique to the Institution, and it forms the basis of the Talent Management model and the corporate culture. It can be summed up in three pillars: mindset, acting with the customer and the Bank in mind; delivery, working with commitment and efficiency; and engagement, adopting a positive and collaborative attitude. The "Being Sabadell" formula is already being applied by the Bank's finest professionals. It is what makes the Bank genuine and different from other banks.

5.2.2. Strategy

5.2.2.1. ESRS 2 SBM-2: Interests and views of stakeholders

Employees are a stakeholder group identified in the double materiality exercise carried out and described in section 3.2 SBM-2: Interests and views of stakeholders.

As indicated in that section, when conducting the double materiality analysis, the interests and views of this group have been taken into account. In this respect, the group of employees has been analysed through questionnaires, which asked them about the topics related to sustainability that directly affected them.

5.2.2.2. ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

The Group has identified the material positive and negative impacts related to employees. These have been grouped together under the Own Workforce topic. Similarly, the impacts have been defined based on the impact materiality assessment and are detailed in section 3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model.

Banco Sabadell uses internal policies and procedures to promote actions that allow the entire workforce to work in an environment in which fairness and equality are the strategic elements of the corporate culture.

The basic principles of the Institution's remuneration policies establish the need to ensure a competitive and fair remuneration system (external competitiveness and internal fairness), which among other things involves aligning with market standards and being flexible in order to adapt to the needs and requirements of the environment and the sector.

Similarly, the gender pay gap becomes a priority focus area for Banco Sabadell's workforce management. Its policies and procedures lay down mechanisms to prevent and mitigate unequal pay between men and women, along with the commitment to gradually reduce that gap and move ahead with the goal of supporting the economic and social transformation of the environment. In terms of equal pay for the same role with the same responsibility, Banco Sabadell makes no type of wage discrimination between genders, neither when recruiting staff nor during employees' salary reviews, monitoring the impact of any salary reviews.

The People division has undertaken a firm commitment with the Institution to ensure that Banco Sabadell has the necessary people at all times: people who are committed, motivated and work efficiently. This strategic priority is the driver of the Talent Management Model, which aims to provide people working at the Institution with the best place in which to develop their professional careers. The training proposal, always aligned with the needs of the business and with the regulatory framework, seeks to foster people's professional development so that they can become the drivers of change, leading the transformation and innovation of the sector.

As at 31 December 2024, Banco Sabadell Group's workforce consisted of 18,769 people distributed across the various regions in which it operates, practically all of whom have permanent contracts (99%). The average age of the workforce is 45 years, with an average length of service in the organisation of 17 years. This workforce is diverse in terms of both geographical distribution (30% are in international locations) and gender (54.6% are women).

The Group's workforce has shrunk by 2.8% over the past year, going from 19,316 employees to the current 18,769 employees. The Bank continues to engage in a process to adapt to the transformation of the environment (customer digitalisation, new ways of working, disruptive technology, etc.) in order to build the best possible future for the workforce, customers and other stakeholders. In 2024, the smaller size of the workforce was mainly the result of cost management initiatives carried out in the United Kingdom.

In addition, as at the end of 2024, Banco Sabadell has 204 contract staff in Spain with a temporary employment contract, hired through Temporary Employment Agencies, in order to cover two types of leave: shortterm leaves of absence (of up to 90 days) and annual leave scheduled in the holiday calendar, but only where the service needs cannot be met through other means. Contract staff are mainly located in the branch network (>90%).

On the other hand, the Group, aware that good working conditions are important for the health and safety of its people, follows a policy of prevention and continuous improvement of the working conditions and health of its teams. The Equality Plan, signed in February 2022 with workers' legal representatives, aims to ensure that the workforce has a good work-life balance and sets out work-life balance measures available to the entire workforce, in addition to establishing a framework for flexible working hours that can be used to improve the balance between personal and professional interests under equal terms for both men and women.

The team of professionals at Banco Sabadell is capable of transforming itself and facing up to major challenges in which people bring their best selves to work, with the firm commitment of driving forward the economic and social transformation of the environment.

5.2.3. Impacts, risks and opportunities management

5.2.3.1. S1-1: Policies related to own workforce

Banco Sabadell has a set of policies, codes and standards that govern and guide the actions of its own workforce across the entire organisation. This regulatory framework is reviewed on a regular basis and ensures compliance with European directives and regulations, as well as with all standards in force at the local level.

Banco Sabadell's policies are approved by the Institution's Board of Directors of Banco Sabadell, as the top approval authority, responsible for establishing principles, commitments and objectives. The policies listed below are those related to the Institution's own workforce and they are published on the Bank's corporate website or on its corporate intranet available to the entire workforce.

Where the scope of the following reported policies makes specific reference to Banco Sabadell Group, it includes information that covers the entire banking business perimeter, taking into account the Banco Sabadell brands that operate in Spain; TSB, which operates in the United Kingdom; and Banco Sabadell Mexico, which operates in Mexico.

Banco Sabadell Group Human Rights Policy

Through this Policy, Banco Sabadell Group defines a series of principles with the objective of supporting and respecting the protection of internationally recognised human rights within its sphere of influence and, to that end, it takes into consideration the Group's relationship with its various stakeholders, among them employees.

In terms of its employees, the Group fosters and strives to keep an environment where everyone in the workforce is treated with dignity and respect, fairly, and without discrimination of any kind on grounds of gender, ethnicity, age, social background, religion, nationality, sexual orientation, political opinion or functional diversity; promoting equal employment and promotion opportunities, work-life balance, and the inclusion of people with functional diversity, whilst ensuring the fundamental right of employees to form or join unions or other representative bodies, safeguarding freedom of opinion, as well as employees' basic right to engage in collective bargaining, and prohibiting any form of forced or child labour.

This commitment is underpinned by, among other things, the Guiding Principles on Business and Human Rights, the Universal Declaration of Human Rights, the International Labour Organisation's Declaration on Fundamental Principles and Rights at Work, and the United Nations Principles for Responsible Investment.

Banco Sabadell Group Code of Conduct

This document aims to define the criteria that should be followed for ethical and responsible behaviour, both in relationships within the Group itself and in those entered into with customers, suppliers, shareholders, investors and other stakeholders.

The Group adopts the following principles to build its corporate culture and as a framework of reference for the aforesaid Code: Will to serve, Proximity, Adaptability, Commercial approach, Innovation, Professionalism, Ethical behaviour, Sustainability, Austerity, Prudence, Teamwork, Compliance, Transparency, and Respect for privacy.

The entire organisation's commitment to effective equality between women and men is a reality that is reflected in Banco Sabadell Group's Code of Conduct. This Code promotes equal opportunities in access to work and career advancement, ensuring that there is no discrimination on account of the race, sex, ideology, nationality, religion, sexual orientation or any other personal, physical, psychological or social condition of its workers.

The Code of Conduct is intended to motivate, retain and attract a team of competent and professional people, offering appropriate overall compensation through its human resources management policies, the pillars of which are fair and competitive remuneration, respect for people's dignity, and guiding decision-making towards reducing the gender pay gap, all within the existing regulatory framework.

Banco Sabadell Group Sustainability Policy

The goal of this Policy is to frame the Group's activity and organisation within ESG parameters, which incorporate environmental, social and governance factors in decision-making. At the same time, based on those parameters, it aims to respond to the needs and concerns of all of its stakeholders.

A series of principles are established in order to adapt the organisation to the challenges and opportunities stemming from sustainability: the contribution to sustainable development, prudence, transparency, security, diversity, commitment to society, environmental protection, respect for fundamental human rights, and professional development.

Banco Sabadell Director Selection Policy

The objective of this Policy is to establish the principles and criteria that Banco Sabadell should take into account in its selection processes and also, therefore, in the initial fit and proper assessment and ongoing assessments of the members of the Board of Directors, as well as in the re-election of members of the management body in order to ensure their smooth succession, the continuity of the Board of Directors and the suitability of all its members. Furthermore, it lays down the principles and targets in relation to diversity in the selection, induction and training of directors, once appointed and throughout their term of office.

The process for selecting candidates for Directors and re-electing existing Directors is governed by the principle of diversity, among others, thereby fostering diversity on the Board. The main principles are as follows:

• The Board Appointments and Corporate Governance Committee will identify the needs of the Bank, ensuring that the appointment or re-election favours both diversity on the Board and a Board composition that is suitably balanced.
• Candidates for the role of Director must meet the requirements of repute, suitability and good governance necessary for the performance of their role; in particular, they should have recognised solvency, experience, qualification and training.
• When selecting candidates for the role of Director, it will be necessary to consider the objectives, parameters (professional competence, diversity, good repute and suitability) and procedures for selection, assessment and appointment established in the Director Selection Policy and the recommendations and criteria of the Good Governance Code of Listed Companies issued by the CNMV.
• The procedure will ensure that Directors' mandates are renewed in an orderly and well-planned manner, safeguarding the continuity of the business and enhancing the corporate governance system.
• The procedure will ensure a compliant qualitative composition of the Board of Directors in which External and Non-Executive Directors should account for no less than the majority of the total number of Board members. There should be a significant proportion of Independent Directors among the External or Non-Executive Directors.

Banco Sabadell Group Remuneration Policy

The main aim of the Remuneration Policy is to define the principles of Banco Sabadell Group's remuneration framework with the utmost transparency and clarity, so that they can be known and understood by all Group employees. It is applicable to all Banco Sabadell Group companies, although different remuneration components will apply depending on the region, activity sector, professional category and/or function performed by each employee.

The Policy is based on the following principles:

• Promote business and social sustainability in the medium-long term and ensure alignment with the Group's values.
• Reward performance, thereby aligning remuneration with individual results and the level of risk taken.
• Ensure a competitive and fair remuneration system (external competitiveness and internal fairness).

In addition, the following aspects in relation to sustainability are taken into account:

• Remuneration practices are in keeping with the Institution's credit risk management approach, as well as with its appetite and strategies in relation to this risk, and do not create any conflicts of interest.
• Consistency with the integration of sustainability risks and publication of the related information on the Group's website.
• Encouragement of actions in keeping with the Group's climate-related and environmental approaches, as well as with the Group's voluntary commitments, and promotion of a long-term approach to managing climate-related and environmental risks.
• Contribution of remuneration components to the promotion of environmental, social and governance actions in order to make the business strategy sustainable and socially responsible. KPIs for ESG matters are included and linked to the variable remuneration of employees through the Synthetic Indicator (SI), making them part of the Group objectives with a weight of 10%. The ESG metrics include diversity indicators in order to increase the number of women in different management positions⁵¹ .

Banco Sabadell Prevention Plan

Banco Sabadell's Prevention Plan is the roadmap for health and safety in Banco Sabadell. Its accompanying policy lays down the principles and guidelines that the management model should follow. The Plan sets out the set of resources, functions, responsibilities and good practices, under the premise of a cross-cutting model embedded throughout the organic structure in order to achieve the best possible results.

Although the guidelines and prevention processes are established and promoted by the Occupational Hazard Prevention (OHP) division, which is legally set up as the Group's Joint Prevention Service, it is through the integration model that safe and healthy workplace environments can be provided. The delegation of prevention functions of OHP officers at branches, regional divisions and territorial divisions, along with the commitment of centralised units, are the key to the success of the current prevention model.

The Plan is approved and reviewed by the State Health and Safety Committee (a collegial body with both representatives of the company and legal representatives of the workforce).

⁵¹ For more details, see section 2.3 GOV-3: Integration of sustainability-related performance in incentive schemes

A summary of this prevention activity is published every year in an Annual Report, which is available on the Bank's intranet and also on its corporate website.

Banco Sabadell Plan for Effective Equality between Women and Men

Banco Sabadell has had an Equality Plan in place since 2010, which was approved by the company and workers' legal representatives and renewed in 2016 and 2022. The current Plan will remain in effect until 31 December 2025.

The Equality Plan is comprised of a set of positive measures and actions that aim to incorporate the principle of equality between women and men in the organisation.

Its features include the following:

• It is designed for the entire workforce, rather than being aimed solely at women.
• It adopts gender mainstreaming as one of its guiding principles and as a strategy to achieve equality between women and men. This involves including the gender perspective in companies' management arrangements, in all their policies and at all levels.
• It considers participation through dialogue and cooperation of all parties as one of its core principles.
• It is a preventive plan designed to eradicate any possibility of future discrimination on account of one's sex.
• It has internal consistency, it is dynamic and can be changed depending on the needs that may arise from its monitoring and assessment.
• It arises from a firm commitment undertaken by companies to equal treatment and opportunities between women and men and it ensures the provision of adequate human and material resources for its implementation, monitoring and assessment.

Within this framework, there is a specific protocol for the prevention of workplace harassment, sexual harassment, sex-based harassment and discrimination, which aims to articulate the necessary measures to prevent and combat all forms of harassment in the workplace. It is an essential tool to raise awareness among staff and ensure and in-house, confidential and swift channel to resolve any conduct qualifying as harassment that may occur within the company. There is also a Harassment Prevention Committee with equal representation, tasked with ensuring compliance with, and the full effectiveness of, the protocol, investigating any report, communication or complaint regarding behaviour that could be considered harassment, acting with the appropriate confidentiality and proposing the necessary precautionary and corrective measures.

The Anti-Harassment Protocol is available to all staff on the Equality and Diversity Portal of the corporate intranet.

5.2.3.2 S1-2: Processes for engaging with own workers and workers' representatives about impacts

Banco Sabadell Group guarantees the basic rights of all its employees in relation to freedom of association and collective bargaining. The Group's Responsible Banking and Sustainability Policy considers it vital to observe standards, working conditions and rights of employees, such as their freedom of association and union representation, which are set out in standards, collective bargaining agreements and other agreements signed with the corresponding workers' legal representatives. All this within the framework of consensus with trade unions, using dialogue and negotiation to address all issues, differences and conflicts within the Group. Dialogue takes place on a continuous basis through the Labour Relations division, addressing topics informally so as to speed up the process. There are also other channels that can be used to contact workers' union representatives, defined in the quarterly meetings held by the State Health and Safety Committee and the semiannual meetings of the Equality Plan Monitoring and Assessment Committee.

One of the main duties is to represent workers in occupational health and safety committees. Furthermore, the Group proactively promotes collective bargaining, together with the head of the Labour Relations division, who guarantees such collaboration, as generally speaking specific labour agreements are drawn up with workers' legal representatives. The elected trade union representatives are allocated hours from their normal working hours to engage in their trade union activities.

In Spain, the right to freedom of association is provided in the Workers' Statute and the Collective Bargaining Agreement for Banks. The Bank has nine trade union sections in Spain, which represent at least one person for each union section, and which operate on a State-wide and autonomous community basis.

Workers' representatives are voted in every four years, in accordance with the guidelines set forth in prevailing legislation and the implementing agreement enforced in the Spanish Banking Association (Asociación Española de Banca, or AEB), together with the most representative State union sections of the Spanish banking industry. The results of the union elections determine the composition of the various Works Councils, as well as staff delegates, who are the main points of contact representing the company and who take part in collective bargaining negotiations.

In addition, the following section describes the general processes that exist to collaborate with the Institution's own workforce, such as the Assistance and Grievances Office, the FlashIN newsletter, and surveys.

5.2.3.3. S1-3: Processes to remediate negative impacts and channels for own workers to raise concerns

The Group carries out various processes to prevent and remediate negative impacts. Specifically, to mitigate the impacts of the gender pay gap, the following aspects are taken into account:

Equal pay

Banco Sabadell Group's remuneration models do not generate a pay gap, and one of the guiding principles of the Group's Remuneration Policy is to ensure a competitive and fair remuneration system that rewards professional experience and responsibility, irrespective of the employee's gender. The policies are based on equal pay for male and female employees for equal work or work of equal value.

Banco Sabadell's corporate strategy fosters actions in relation to Environment, Social and Governance (ESG) matters, by incorporating sustainability indicators, weighted at 10%, into the corporate objectives linked to employees' variable remuneration. The social lever establishes KPIs to improve female representation in the management group as a key mechanism to reduce the pay gap. This indicator has been part of its strategy since 2020. Similarly, people who form part of the Group's Identified Staff have a sustainability indicator linked to their long-term remuneration weighted at 20%.

The gender pay gap, with a material impact that affects the Bank's workforce, is one of the priority focus areas of the management team, which launches recurrent mechanisms with the aim of gradually reducing that gap, in fulfilment of the premises of our remuneration models and the guiding principles of the Group's Remuneration Policy.

In addition to ensuring equal pay for the same work or for work of equal value, equal opportunities are also guaranteed, as these are a prerequisite for long-term gender-neutral remuneration. This includes, among other things, hiring policies, career development, succession plans, access to training and the possibility of being selected to fill internal vacancies.

In recent years, the measures implemented have been effective, resulting in a gradual reduction of the Group's pay gap:

	Pay gap based on average total remuneration
	2021	2022	2023	2024
Spain	23.74%	23.08%	21.08%	20.61%
UK (TSB)	33.38%	32.33%	29.88%	29.98%
Mexico	32.78%	26.45%	25.03%	20.51%
Group	26.77%	25.89%	23.69%	23.02%

Pay gap based on median total remuneration
	2021	2022	2023	2024
Spain	18.38%	16.18%	13.86%	13.89%
UK (TSB)	28.49%	26.47%	26.11%	26.74%
Mexico	18.72%	17.55%	22.14%	11.74%
Group	21.34%	19.25%	17.56%	17.13%

The overall pay gap is calculated as the average pay gap of each country weighted according to the percentage that their workforce represents out of the total.

The gross pay gap indicator cannot be used to identify potential gender inequalities within the company. To do that, it is essential to employ statistical methods that permit the calculation of the portion of the gender pay gap that cannot be explained by other factors that might influence a person's compensation, such as their individual characteristics and those related to their job. The portion of the pay gap that remains when comparing individuals with similar characteristics whose only difference is their gender is known as the adjusted pay gap. In 2023, Banco Sabadell worked together with the Pompeu Fabra University on the certification of an econometric model to determine the adjusted pay gap in Spain. The results for 2024 were an average of 4.80% and a median of 2.64% (average of 5.27% and median of 2.90% in 2023). Therefore, the inclusion of specific job-related characteristics goes a long way in explaining the observed pay gap in Banco Sabadell.

Adjusted pay gap in Spain
	2024	2023
Pay gap based on average total remuneration	4.80%	5.27%
Pay gap based on median total remuneration	2.64%	2.90%

The main actions to remediate the gender pay gap are designed to reinforce the alignment and commitment of the entire workforce and to foster female representation in positions with a higher functional value. The main initiatives of 2024 are set out here below:

• Diversity Programmes specific to divisions with less representation:
  • First edition of the diversity programmes for Corporate & Investment Banking, Business Banking and Retail Banking, which took place in 2024 and in which 42 women took part.
  • Second edition of the Female Leadership Programme, which aims to promote the professional development and career plan of women with high potential, in order to create a pool of female talent ready to take on more responsibility so as to foster women's promotion to management positions. 24 women took part in this edition, which brought together all businesses, namely Corporate & Investment Banking, Business Banking and Retail Banking.
• Promotions given in 2024 through Banco Sabadell's Managerial Performance Evaluation Committee, 48% of which were given to women.
• Promotions among participants of the Career Acceleration Programme (CAP) as at the end of 2024, with 62% of participants promoted to top managers in the first edition and 46% of participants promoted to top managers in the second edition. In addition, during the two editions of the CAP, 58 women out of a total of 112 women participants were promoted (52% of the total were promoted to top managers).
• Monitoring of pay gap during salary reviews, analysing the impact of any salary reviews on that gap. The People division monitors calculations on an ongoing basis to make decisions that will gradually reduce the gender pay gap. The analysis and its conclusions are discussed at the People division's top-level committee and escalated to the corresponding governing bodies on an annual basis. In 2024, Banco Sabadell did not receive any notifications about its workforce in relation to the pay gap.

In addition, section 5.2.4.7 S1-16: Compensation metrics (pay gap and total compensation) gives more information about the pay gap, including the adjusted pay gap.

Diversity

The Group views diversity as a valuable source of corporate wealth and promotes actions to cultivate it. To that end, Banco Sabadell is committed to fostering workplace environments in which people are treated with respect and dignity, seeking to further the professional development of its workforce and ensuring equal opportunities in its candidate selection, staff training and promotion processes, offering a workplace environment that is free from any form of discrimination based on gender, age, sexual orientation, religion, ethnicity or any other personal or social circumstance.

In terms of gender diversity, the Bank's workforce is diverse and balanced, with women representing 54.6% of the total as at December 2024. The representation of women in management positions is the main action lever to reduce the gender pay gap. It consists of increasing female presence in all areas of the organisation, ensuring non-discrimination and guaranteeing equal opportunities.

At present, the foundations of the strategy in terms of diversity, fairness and inclusion are set out in the Equality Plan, which was renewed in 2022 with the agreement of 100% of workers' legal representatives, but the Institution has been treading this path since 2010, adapting to regulations and remaining at the forefront and ahead of the challenges posed by society in this field in order to report better results and strengthen the culture of "Being Sabadell".

Similarly, in 2024, Banco Sabadell has remained committed to the internal and external communication and dissemination of all the measures taken in terms of diversity:

• Actions during Equality and Diversity Week, in order to recall the Bank's commitment to creating an environment in which people can express themselves as they are and in which diversity is viewed as an indispensable requirement to be a more competitive and innovative organisation.
• In May, the second edition of the Female Leadership Programme was launched, with the aim of promoting the professional development and career plan of women with high potential, in order to create a pool of female talent ready to take on more responsibility so as to foster women's promotion to management positions. The edition included a programme to develop one's Personal Brand, Management and Leadership skills, with support from mentors.
• Activities have been carried out in which actions were aimed at all persons in the organisation and which took place both in-person and in blended format. Among other things, actions were taken to highlight internal resources that address the topics of equality and diversity, such as "I Am Remarkable" (workshops designed to motivate women to promote themselves, to question social perceptions of self-promotion and to reflect on the barriers that prevent professional achievements and aspirations from being voiced), training about diversity, fairness and inclusion, and the Equality and Diversity space.
• Every year, to mark the World Day for Cultural Diversity, the Bank showcases the diversity of its workforce from a different angle: the diversity of cultures, origins and nationalities that make up the team, the diversity of languages in which staff interact, and the diversity of the customers whom it serves in different countries.
• At an external level, Banco Sabadell is part of the steering group behind the Women in Banking (WIB) project, an initiative designed to share best practice among banks in Spain and promote a network of women within the banking industry. The aim of WIB is to lead and bring about a meaningful change in the way women are valued in decision-making roles within the Spanish banking industry. The initiative has the support of eight financial institutions present in Spain and of the Spanish Banking Association (Asociación Española de Banca, or AEB).
• Banco Sabadell is also an active participant of external events, such as Empowering Women's Talent, Diversity Day, and the Women's Talent Day event, publicising the SWING initiative.
• The Sabadell Women Inspiration Group (SWING), an initiative promoted by female senior managers at the Bank, aims to have women holding senior management positions mentor women aspiring to those positions. This programme has taken place throughout the year with monthly sessions. Its aim is to

empower women at Banco Sabadell and raise awareness of the value of diversity and its benefits. The female senior managers that make up this group are standard-bearers for female talent and female leadership in Banco Sabadell.

• In 2022, the Institution once again received the "Equality in the Workplace" seal of distinction from the government of Spain, which it has had since 2018, awarded for its prominence and particularly significant application of policies for equal treatment and opportunities among its workers, and in terms of gender diversity. Furthermore, the Chief Executive Officer, César González-Bueno, signed the "CEOs supporting diversity" (CEO por la diversidad) initiative launched by the Adecco Foundation and the Spanish Confederation of Employers' Organisations (Confederación Española de Organizaciones Empresariales, CEOE).

To ascertain the views of its own workforce, the results of the workplace environment survey are used. Responses can be broken down by gender, to show any differences in the scores given by women and men to the various categories (commitment to sustainability, meritocracy and consistency, management, ways of working, well-being, sustainability, equality and diversity, Banco Sabadell's leadership, promotion, work-life balance, and compensation). In general, there are no major differences between the scores given by each gender. They gave fairly similar scores in all categories, with differences of just 1 to 4 percentage points. It is worth noting that the categories given the lowest scores by women were remuneration, promotion and wellbeing, although the second of these, promotion, received a better score from women than from men (with a difference of 4 points).

Diversity in the Board of Directors

A total of 15 directors sit on the Bank's Board of Directors. Specifically, as at 2024 year-end, there were six female directors, including five female Independent Directors out of a total of ten Independent Directors and one female Other External Director.

At Banco Sabadell, in 2024, women accounted for 40% of all members of the Board of Directors, with this percentage having been attained ahead of the timeframes provided in Organic Law 2/2024 on equal representation and balanced presence of women and men,and fulfilling the Bank's commitment stated in the document Sabadell's Commitment to Sustainability for 2023. Women also account for 50% of Independent Directors, amply complying with the Directive of the European Parliament and of the Council on improving the gender balance among directors of listed companies and related measures.

In terms of the presence of women on Board Committees, female Directors sit on all Board Committees. The Board Remuneration Committee is chaired by a female Independent Director and its members are all women. In the Board Appointments and Corporate Governance Committee, the vast majority of members (75%) are women. There is equal representation between both genders in the Board Audit and Control Committee and in the Board Risk Committee, while the presence of women in the Delegated Credit Committee is 20%. In the Board Strategy and Sustainability Committee, women account for 16.67% (on the Strategy side) and 20% (on the Sustainability side).

Diversity in the Board of Directors
	2024	2023
Men	9	10
Women	6	5
Total	15	15

Diversity in the senior management group

At the Group level, women represent 34.3% of senior managers, increasing by 1.2 percentage points in 2024 and thus continuing with the trend of improvement of recent years. This commitment is fundamental for the Institution's diversity strategy, which seeks to continue increasing gender diversity in management tiers. To achieve this priority objective, it is vital to improve diversity in middle management roles, 42.3% of which were held by women in 2024.

In the case of Spain, the percentage of promotions given to women remained steady (50% in 2024 compared to 59% in 2023), which demonstrates the commitment to improving diversity and the results obtained with the measures put in place.

Breakdown of Group employees
By gender	2024	2023
Men	8,512	8,641
Women	10,257	10,675
Total	18,769	19,316
Percentage of women, by professional category	2024	2023
Senior management	34.3%	33.1%
Middle management	42.3%
		43.8%
Specialist staff	56.9%	57.0%
Administrative staff	70.7%	71.5%

Group data as at 31/12/2024, with the exception of promotion figures, which relate to Spain only.

Channels for the own workforce to express their concerns

The Group has various mechanisms in place for communicating with staff and listening to their concerns, which are key to anticipating their needs and building a great place in which to develop a professional career. Proof of this lies in the fact that Banco Sabadell features in prestigious rankings as one of the 100 best companies in which to work in Spain.

Assistance and Grievances Office:

Banco Sabadell has an Assistance and Grievances Office (AGO), through which it aims to be more mindful of and closer to the entire workforce, attempting to resolve any doubts that may arise in connection with the processes and topics dealt with by the People division, which include: Management, Professional Career, Compensation, Diversity, Leadership Training, Work-Life Balance Consultant, Transfer Requests, My Benefits Portal, Occupational Hazard Prevention (work-related accidents, medical check-ups, etc.), Labour Relations (leaves of absence and special permissions, pension plans, etc.) and Social Relations (assistance for school fees, loans, etc.).

The Assistance and Grievances Office (AGO) is accessed through the internal portal available to the entire workforce. The office autonomously answers the questions submitted by employees, keeping the necessary records and following up on queries and complaints. Those that require additional specialised management are forwarded to a second management level of the People division according to the topic in question for resolution. This year, 43,101 queries were received, while maintaining a high level of quality of service, obtaining a satisfaction rating of 4.33 out of 5.

In addition, to prevent retaliation against those using the channel, the Group has a Policy on the Internal Reporting System and Protection of Reporting Persons, details of which are provided in section 5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture

FlashIN newsletter:

In relation to information resources, in Spain, the FlashIN newsletter continues to be issued and sent to all employees once a week, providing information of interest to staff, as well as guidance and contextual information about the Institution and the sector. In addition, the internal news portal, IN Sabadell, is a crucial element of information and cohesion that provides key information on complex issues generated by the external environment, and on change processes that occur within the organisation itself. This portal, as well as the fortnightly "You are the Manager" (Eres Manager) publication, also includes flash surveys to raise a relevant topic and capture people's feelings about it. This allows the Institution to verify, with each survey, the high degree of commitment of staff at any time.

"The Bank we aim to be" survey:

"The Bank we aim to be" (El Banco que queremos ser) is a survey that provides comprehensive information about the commitment of staff to the Institution's current courses of action and future prospects. The results obtained from the survey remained steady and in line with the good financial performance during the year. Commitment and workplace environment are measured at two different times of the year, measuring the results of the blocks of questions relating to commitment, meritocracy and consistency, management, ways of working, well-being, sustainability, equality and diversity, Banco Sabadell's leadership, promotion, work-life balance and compensation.

The survey is sent out to the entire workforce and participation in the H1 2024 edition was 71%. In general, the survey's results were very positive: there was an improvement across all categories, both in the branch network and in the corporate buildings. There was a reinforced commitment to the company's goals and objectives and also an increased sense of belonging. There was one opportunity for improvement, which was related to the tools and resources that I need to do my work. In Meritocracy and Consistency, it is worth noting the positive ratings given to equal opportunities and the level of internal transparency. As for Ways of working, there was an evident improvement in communication with the workforce. Moreover, there was a substantial improvement in the level of confidence in the decisions made by the Bank's leadership team and in the criteria for professional promotion. The question relating to well-being, This is a mentally and emotionally healthy place in which to work, also showed improvements compared to previous editions, as did the question on work-life balance.

Participation in the H2 2024 edition remained at 71%. There was an improvement across all categories of both the branch network and the corporate buildings, with a smaller difference between both perimeters. Commitment, a key indicator, saw its score improve to a new all-time high. In the Ways of working category, it is worth noting the positive responses to the question about whether the company was doing a good job at keeping the workforce informed. Respondents' trust in the decisions made by the Bank's leadership team and in their appraisal of Management and Equality & Diversity improved. Under the Well-being category, respondents gave a higher score to Work-life balance. In the Meritocracy and Consistency category, equal opportunities and the level of internal transparency continued to be rated highly.

In addition, building on the approach to always listen to employees, weekly surveys were sent out to the workforce during the second quarter of the year. Specifically, they were sent to a small random sample of employees in order to ascertain their work experience in the Bank.

5.2.3.4. S1-4: Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions

Banco Sabadell Group plays a fundamental role for its own workforce through the initiatives and measures described below, in addition to those mentioned previously. All of these initiatives and measures are linked to material impacts, as no material risks or opportunities were identified in connection with its own workforce.

Talent: management, attraction, retention and leadership programmes

The Group aspires to provide people working at the Institution with an ideal place in which to develop their professional careers. To make this possible, the Group has a solid talent management model, a framework of professional opportunities within the Group (internal recruitment, promotions and training) and the ability to attract the best external talent for profiles that cannot be found within the Group.

Banco Sabadell's talent management model seeks to manage and develop talent and foster employee loyalty, applying the principles of meritocracy, development of internal potential, and diversity. It requires suitable mechanisms to be in place to identify people's talent and potential, offering them opportunities for career development and professional advancement in the Group.

The Sabadell Talent Appraisal is the starting point for talent management, a key process aimed at all Banco Sabadell employees and designed to identify people's talent and potential, give individual feedback and make decisions on career progression during processes such as internal recruitment, training or wages.

Aligning the talent appraisal process with 'Being Sabadell' is a determining factor for the Bank to be consistent in how talent is defined, identified, appraised and developed in the Bank. It has therefore been structured around three components (mindset, delivery and engagement), assessing contribution and performance, skills and potential, and getting to know the professional aspirations of each employee.

After this identification and self-reflection phase, the conversation with line managers is a key opportunity to share mutual feedback about what is expected of the employee, what they bring to their role, what strengths they have and where there is room to improve. The process ends with the creation of an individual development plan for each employee. This appraisal counts as 20% of the individual targets of employees receiving variable remuneration.

It is important to note that many people take part in this appraisal, as it involves not only current line managers giving their opinions and reasons for their appraisal but also feedback from functional or additional managers (for example, from previous managers during the year). Lastly, the division's perspective is used to supplement and validate the calibration.

The appraisal components are broken down according to the three main aspects of 'Being Sabadell':

• How do they convey their mindset? Do they always act with the Bank in mind, applying their expertise and thinking outside the box?
• How do they deliver? Do they focus on the task at hand, working quickly and efficiently to deliver exceptional outcomes? Do they take into account the quality of delivery and the need for compliance with regulations?
• How do they engage with others? Do they have a positive attitude that creates a good work environment and do they encourage teamwork?

The Bank's talent recruitment model provides the Institution with the profiles it needs to operate and achieve its targets. One of the main aspects is to foster the professional development of all persons in the Institution. To that end, it prioritises internal recruitment over external recruitment, equal opportunities and process quality, and it is committed to the promotion of people with potential, offering opportunities for internal growth, thus creating professional careers that will be advanced thanks to encouragement and the initiative taken by those who form part of Banco Sabadell to grow and develop.

The conversation between the manager and the employee is the key element to achieve personal growth and career development through feedback. The result is an individual development plan to take the necessary action to improve, develop and train.

The main processes used to identify, develop and unlock the existing and potential talent of each employee are the following:

• Management Appraisal (180º): every year, employees give an appraisal of their managers. This process has been aligned with the 'Being Sabadell' core ideas. This process is visible to the line manager and is taken into account in their appraisal. The line manager is also given feedback about the results obtained, while the people manager keeps track of them.
• Employee Appraisal Committees (EACs): these meet on annual basis as part of the talent workflow and they are the main forum in which objective, meritocratic and collective decisions are made about the employees in each general/territorial division. It is the place where the calibration of the Sabadell Talent Appraisal is finalised to ensure meritocracy with an all-encompassing perspective. The resulting talent maps are key components of internal talent management, which are based on strategic needs and meritocracy. The Employee Appraisal Committees make decisions on appointments, people and talent within each division.

Promotions to roles with greater responsibility are validated by internal bodies, with the support of the People division. In the case of appointments to management positions, following the Employee Appraisal Committee meetings, proposals are submitted to the Managerial Performance Evaluation Committee and the Board Appointments and Corporate Governance Committee.

• Managerial Performance Evaluation Committee (MPEC): this Committee meets on an annual basis with the Bank's Management Committee in order to decide on changes to senior management staff, approving proposals for joiners and leavers in that group. Promotions to senior management take place taking into account as fundamental criteria the assessment of both positions and talent, as well as the size of this group, which should be in keeping with the structure and the established targets and commitments in relation to diversity.
• Key Function Holder Substitute Map: the 'key roles' identified are reviewed every year, as a result of changes in the organisational structure, and the pool of substitutes is updated, ensuring that talent in key functions is managed proactively.

In terms of attracting external talent, in Spain, as at the end of 2024, staff with the following profiles joined the workforce: business development (39%), financial and regulatory analysts (16%), data specialists (15%), technology and digital specialists (12%), cross-functional and operational experts (8%), and support and other staff (10%).

Similarly, in relation to attracting talent, actions were taken to fill vacancies internally. Internally, the type of profile for which there were vacancies was varied, with 39% corresponding to business development, 30% to financial and regulatory analysts, 12% to cross-functional and operational experts, 7% to technology and digital specialists, 4% to data specialists, and 8% to support and other staff.

New permanent hires in Banco Sabadell Group based on the breakdown by age and gender are shown below:

		2024		2023
Age range	National	International	National	International
Under 30	254	48	343	37
Between 30 and 50	194	116	346	80
Over 50	37	14	35	10
Total	485	178	724	127

Group (ex-TSB) data as at 31/12/2024. 'International' includes Mexico, foreign branches and representative offices.

		2024		2023
Gender	National	International	National	International
Men	263	113	403	73
Women	222	65	321	54
Total	485	178	724	127

Group (ex-TSB) data as at 31/12/2024. 'International' includes Mexico, foreign branches and representative offices.

Furthermore, managers are the cornerstone of the Group's development and they play a fundamental role. They guide people, generating environments of collaboration and agility, developing the business with the customer in mind. The Bank is evolving its culture and ways of working to be a more agile and exciting place to work, and for this to happen it leans on managers as a lever of change.

• Corporate Management Programme (CMP): this programme is mainly aimed at people promoted to the role of director or unit head with direct reports and who have held that role for 1.5 years or less, and it contributes to managers' training on skills, collaboration and values. The programme focuses on the culture of the Bank and on a development pathway for the manager in question, based on a meritocratic model that places the best people as leaders and drivers of change and innovation. In 2024, all of the programme's sessions took place in person, with the exception of the first and last sessions, which were held virtually. It lasted a total of five weeks, completed over five months, with an estimated total of 70 hours dedicated between in-person sessions, tutorials, and completion of the final project. This year 138 managers took part in the programme (47.83% of whom were women).

The approach of the programme was changed to align it with the Eres Manager project, improving the networking sessions with the People division. The key ideas to be conveyed during the programme relate both to a cross-sectoral approach and to the nature of their experiences. At the same time, they generate greater self-knowledge, the development of skills, and abilities to manage people.

• Career Acceleration Programme (CAP): the goal of this programme is to prepare employees who will lead and tackle the challenges of the future. The third edition of the CAP was launched in 2024, with a total of 102 participants (61% women), all of whom were upcoming senior managers of the Bank. The programme will take place over 18 months, beginning in April 2024 and continuing until November 2025.

The programme was designed with the aim of accelerating the career development of a group of employees considered to have high potential and who represent the values and attitudes that the Bank seeks to promote, making it easier to attain the necessary diversity that it is seeking to achieve among senior managers.

Participants focused on five different areas: self-awareness (360º questionnaire), training (by completing four leadership development modules with the partner ESADE), Banco Sabadell's perspective, mentorship and new challenges.

• Senior Manager Development Programme (SMDP): programmes for senior managers continued in 2024, including the Senior Manager Development Programme, for those who attain the role of Top Manager, in order to support them as they transition to their new role and to prepare them for the changing business environment, focusing particularly on the specific challenges of their new position.

The programme follows a 'learning by doing' approach and aims to build networks within senior management, offering networking opportunities and visibility. Participants are required to take on more leadership than their current role requires them to, conveying the vision and values of the Institution. To that end, the key challenges of the programme focus on how participants approach managing their team as a leader of managers and as the main person responsible for the environment within the team and their commitment to their work, on the creation of spaces of trust within their area of responsibility, offering teams feedback and working on team development and, lastly, they focus on contextualising decision-making from the broadest possible perspective, understanding and establishing relationships with other corporate areas.

It includes a 360º appraisal process and various group coaching sessions, with groups of 5/6 people, to complement the training sessions. The 360º processes are carried out based on the skills previously identified by Banco Sabadell as being necessary for the performance of the managerial role. Depending on the specific skills in question, a self-assessment takes place, along with evaluations by managers, peers and other assessors. All of these evaluations culminate in an individual report, shared with each participant, so that they may put together their individual development plan based on the skills that need to be developed. The partner working on the 360º tool is Korn Ferry International, a leading global partner for management solutions, while the provider of the overall programme is Center for Creative Leadership (CCL), a standard-bearer for leadership on an international scale.

Similarly, programme participants take part in the Influence Style Indicator (ISI), so that they can discover their preferred leadership styles. It is a tool for self-awareness that enables them to become better leaders. In 2024, a new edition of the programme took place in 100% on-site format, in which 92 senior managers (43% of whom were women) took part and gave the programme a rating of 4.6 out of 5, with an NPS of 9.1 out of 10.

• Management Leadership Programme (MLP): the third edition of this programme will take place in October, with 47 enrolled managers appointed as Corporate Directors (34% of them women). The programme focuses on aspects linked to the main changes brought about by the digitalisation process, innovation processes, entrepreneurial initiative and changes in the business model, team leadership, collaboration and trust, talent management, diversity and inclusion, strategy, and digital transformation.
• I am Remarkable: seven two-hour workshops for upcoming female senior managers from all divisions of the Bank (around 68 women) were run in 2024 to reflect on the social perception of self-promotion, glass ceilings, and to promote the careers of women in pre-senior management roles. 14 internal facilitators ran the programme on a voluntary basis after receiving training.

Training

Banco Sabadell Group's training model is built on the following pillars:

• Offer training aligned with the business and needs, both the regulatory needs of the market and the needs of staff members of Banco Sabadell Group.
• Improve the development of people, as drivers of change and transformation.
• Streamline the Institution's training budget so that more people can receive training and to achieve greater transformation.
• Be an example within the financial sector in terms of innovation in training.
• Be leaders in terms of adjusting training schemes to the digital transformation of business lines.

In 2024, the Group continued to support the business in the challenges and targets that it has set itself, offering new specific training resources for strategic projects that are a matter of priority for Banco Sabadell Group, focusing on aspects such as specialisation programmes for commercial roles, financial current affairs and sustainability. Over the course of the year, the Bank continued to provide all of the training included in the training pathways for the different business specialists.

Some of these training activities included: RAROC programme (aimed at the branch network), marketing and digital advertising development programme (aimed at marketing specialists and imparted by ESIC Barcelona), and the expertise programme on advising large corporates (aimed at directors of large corporations and imparted by BESPOKE).

On the other hand, regulatory training in Spain continued to be very intensive, accounting for 82% of the total training hours completed up to December 2024 (vs 70% in 2023).

In addition to this mandatory training, annual ongoing training courses are also imparted in relation to the three certifications required to sell banking products (MiFID, IDD and LCCI), which are mandatory for most people in the Bank's branch network. The time dedicated to accumulating training hours required for certification renewal represented more than 76% of the total regulatory training as at the end of December 2024 (vs 84% as at the end of 2023).

In addition, some of the key projects of this first half of the year include the creation of the "Being Sabadell" space, which offers a selection of online courses from the Institution's catalogue of professional skills training to reinforce the Development Plan of the Bank's employees; the updates to the "You are the Manager "(Eres Manager) space, located in the Management school; the updates of courses on anti-corruption, corporate crime prevention and Banco Sabadell's code of conduct; and the creation and publication of a new space, "Your dayto-day at the branch" (Tu día a día en la oficina), within the Regulatory school, which offers entertaining content about the 12 key aspects that every branch manager should know to perform their day-to-day tasks effectively.

Similarly, in relation to sustainability, support continues to be provided to employees so that they may complete training on this topic, focusing on elements of environmental management, the energy crisis and other content requiring ongoing training in relation to sustainability. Introductory training courses remain in place, including "Introduction to Sustainability" and "Sustainable Borrowing", which are available on the Campus training space, with independent learning courses. To date, 97.4% of employees have completed at least one course on this topic.

The "Sustainable Finance Certification" scheme imparted by the Carlos III University in Madrid (UC3M) is also available. Its syllabus includes an introduction to sustainability and the ESG framework, the role of banks in sustainable investment, international initiatives, the EU's sustainable finance standards and ESG risk management. It also covers investment funds and sustainable pension plans, green, social and sustainability bonds, and the creation of sustainable investment portfolios. Further content includes impact investing, the carbon footprint and ESG risk assessment methodologies.

Work-life balance

The Group's workforce has at its disposal a series of work-life balance measures that are set out in the Equality Plan. These measures seek to ensure that the workforce have a good work-life balance and to establish a framework for flexible working hours that can be used to improve the balance between personal and professional interests under equal terms for both women and men. These measures will remain in place for the duration of the Equality Plan.

All employees of the Bank have at their disposal a Guide to Work-Life Balance Measures, which lists, clearly and simply, the different work-life balance measures that staff can access; it can be found in the Equality and Diversity space of the corporate intranet. Some of these measures are the following:

• Option to apply for extended leaves of absence or special permissions for unremunerated leave, improving on that provided in Article 36.2 of the Collective Bargaining Agreement for Banks (CBA).
• Unremunerated reductions of working hours, as set out in Article 37.6 of the Workers' Statute (WS) and Article 35 of the CBA, for those who as legal guardians are directly responsible for a minor under the age of 12, for a disabled person, or for a family member who, due to their age or due to an accident or illness, cannot take care of themselves.
• Remunerated reduction of working hours, of one hour per day over a two-month period, in order to care for a child under the age of 12 or who due to illness or a very serious accident requires hospitalisation.
• Flexibility to adapt working hours (start and finish times) to meet the needs of those responsible for the care of children below 14 years of age, or who must care for family members up to second degree of consanguinity or affinity who are disabled or above 65 years of age.
• To contribute to the protection of maternity and paternity rights, leaves of absence for the birth and care of a child are guaranteed, as are leaves of absence to care for nursing children, offering the option to take this nursing leave through 15 working days of remunerated leave subsequent to any period of contractual suspension due to the birth, adoption, guardianship or foster care of a child. The duration of the leave of absence for the birth or care of a child will be equivalent to the duration of the leaves of absence taken in accordance with that provided in Articles 48.4, 5 and 6 of the Workers' Statute, with a total of 16 weeks, 6 of which will be mandatory, uninterrupted and comprise full working days, to be taken immediately following the date of the birth, while the remaining 10 weeks may be taken, in weekly periods, either in one single block or in separate blocks, during the 12 months following the date of the birth.

In addition, all employees have the right to receive a school allowance for their children, which is paid at the beginning of the academic year for each child in school between the ages of 0 and 23 years who is economically dependent on the employee in question. For those employees who have a child with a registered physical or mental disability of at least 33%, the maximum age is extended to 26 years.

Employees also have a benefits system linked to the flexible compensation system which allows them to optimise their remuneration by applying for certain products through the payroll, such as "Flex Daycare", which they may use to earmark part of their salary to pay for childcare whilst obtaining tax benefits.

The corporate buildings at Sant Cugat del Vallés, Madrid and Sabadell have a nursing room available for use by employees who choose to combine nursing an infant with their work life. This nursing room can be freely accessed throughout the day.

Banco Sabadell gives its workforce access to a tool called "My Workday" (Mi Jornada), in order to comply with the provisions of Royal Decree-Law 8/2019 on keeping daily records of working hours, and with the Agreement on Keeping Working Time Records at Banco Sabadell, signed on 27/02/2020, where each worker is required to keep a record of the start and finish times of their working day. On the other hand, the Bank continues to promote measures to enhance flexibility, such as telework and flexitime arrangements. The workforce can change their effective working hours at their discretion and with flexibility in order to balance their needs for a work-life balance with the needs of the service. In corporate buildings, for areas covered by the Collective Bargaining Agreement for Banks, the blended model under which staff can work from home for a maximum of 6 days per month remains in place; uptake of that model is voluntary and not contractually regulated.

For all of these initiatives and measures indicated above, the Group has assigned the necessary resources (personal and economic) to ensure that all material impacts are managed.

In conclusion, these practices of the Bank do not generate any material negative impacts on its own workforce.

Details about the measurable targets of initiatives related to own staff are given in section 5.2.4.1 S1-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities.

5.2.4 Metrics and targets

5.2.4.1 S1-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

The People division leads and promotes Banco Sabadell's strategy of Diversity, Fairness and Inclusion (DFI) in collaboration with its businesses and support units. Its functions encompass the implementation of specific initiatives and projects, the promotion of measures, and the oversight of the action plan's objectives. Topics of interest are escalated to governing bodies on a recurring basis for information and monitoring.

At present, the foundations of the DFI strategy are set out in the Equality Plan, which is aligned with the objectives of Banco Sabadell's ESG strategy, which in turn are set out in the Institution's Commitment to Sustainability, aspiring to keep moving forward in relation to diversity, gender equality and talent, and establishing specific goals that will transform the Institution, fostering the presence of the female gender in senior management positions and promoting actions with an impact on society.

Some of the actions that the Institution takes to promote diversity in the Institution and in the Board of Directors are set out here below:

• The Institution ensures and monitors, through the Board Appointments and Corporate Governance Committee, compliance with the required qualitative composition of the Board of Directors, assessing the balance in terms of diversity and promoting the presence of the under-represented sex.
• Plan for Effective Equality between Women and Men and the creation of an Equality Representative to monitor and implement the Plan's actions.
• Selection procedures without discriminatory bias.
• Monitoring of the promotion of women and of diversity in the workforce.
• Promotion of the participation of women in professional development and leadership programmes.
• Monitoring of the impact of any salary reviews on the evolution of the gender pay gap.

In this respect, since 2021 the Bank has been pursuing the following targets for 2025, in relation to the Spain perimeter, in order to move forward with diversity in the Institution and to ensure the training and development of talent:

• 40% female membership on the Board of Directors (this target was met in 2024 with the appointment of a new female director). In 2021, women represented 27% of Board members.
• 33% of senior management roles held by women (this target was met in 2023 and as at the end of 2024 they held 33.9%). In 2021, women represented 29.1% of senior managers.
• 41% of middle management roles held by women (this target was met in 2023 and as at the end of 2024 they held 42.8%). In 2021, women represented 38.8% of middle managers.
• Continuous annual reduction of the pay gap. Since 2021, both the pay gap based on average total remuneration and the pay gap based on median total remuneration have been reduced in Spain, the United Kingdom and Mexico.
• Maintain overall level of satisfaction with training above 80%. The level of satisfaction was 84% in 2021 and 85.5% in 2024.
• Keep employee training completion rate above 95%. In 2021, 98% of employees had received training during the year, while in 2024 this figure was 98.33%.
• Equality in the Workplace Seal of Distinction, which was retained in 2024.

5.2.4.2 S1-6: Characteristics of the undertaking's employees

Banco Sabadell Group employees: Breakdown by gender, professional category, age, country and nationality

Gender	2024	2023
Male	8,512	8,641
Female	10,257	10,675
Other	Not applicable	Not applicable
Not reported	Not applicable	Not applicable
Total	18,769	19,316

Group data as at 31/12/2024.

		2024			2023
Professional category	Men	Women	Total	Men	Women	Total
Senior management	569	297	866	529	262	791
Middle management	1,921	1,407	3,328	2,091	1,632	3,723
Specialist staff	5,467	7,215	12,682	5,341	7,077	12,418
Administrative staff	555	1,338	1,893	680	1,704	2,384
Total	8,512	10,257	18,769	8,641	10,675	19,316

Group data as at 31/12/2024. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

		2024			2023
Age range	Men	Women	Total	Men	Women	Total
Under 30	913	859	1,772	1,014	1,031	2,045
Between 30 and 50	4,824	6,261	11,085	5,060	6,701	11,761
Over 50	2,775	3,137	5,912	2,567	2,943	5,510
Total	8,512	10,257	18,769	8,641	10,675	19,316

Group data as at 31/12/2024.

		2024			2023
Country	Men	Women	Total	Men	Women	Total
Spain	6,076	7,080	13,156	6,041	7,049	13,090
UK	1,948	2,813	4,761	2,176	3,281	5,457
Mexico	327	199	526	267	178	445
Other geographies52	161	165	326	157	167	324
Total	8,512	10,257	18,769	8,641	10,675	19,316

Group data as at 31/12/2024. Workforce in the United Kingdom includes employees at TSB and at Banco Sabadell's London branch.

Nationality	2024	2023
Spanish	69.0%	66.8%
British	23.0%	26.1%
Mexican	2.7%	2.3%
United States	1.2%	1.1%
Other nationalities	4.1%	3.7%
Total	100%	100%

Group data as at 31/12/2024.

⁵² Includes countries in which the foreign branches and representative offices are located, the United States being the country with the largest representation

Breakdown of staff departures from the Group due to dismissal

As at the end of 2024, 600 staff departures had taken place, more than in 2023. This increase was mainly due to the cost management programme carried out by TSB, which had a significant impact on the workforce reduction.

		2024			2023
Professional category	Men	Women	Total	Men	Women	Total
Senior management	8	6	14	8	3	11
Middle management	39	26	65	22	14	36
Specialist staff	156	131	287	43	35	78
Administrative staff	54	180	234	15	7	22
Total	257	343	600	88	59	147

Group data as at 31/12/2024. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

	2024			2023
Age range	Men	Women	Total	Men	Women	Total
Under 30	26	41	67	22	4	26
Between 30 and 50	144	173	317	42	32	74
Over 50	87	129	216	24	23	47
Total	257	343	600	88	59	147

Group data as at 31/12/2024.

Voluntary turnover

The Voluntary Turnover Rate (VTR⁵³) of the Group (ex-TSB) in 2024 was 1.9%. In Spain, the voluntary turnover rate was 1.5%, up by 0.2 percentage points compared to 2023. Talent management actions made it possible to maintain staff loyalty and engagement, but there was also some saturation in the employment market, with fewer opportunities to change jobs. The turnover rate fell by 0.3 percentage points in the international perimeter, due to a larger workforce in Mexico.

		2024		2023
Age range	National	International	National	International
Under 30	10.5%	20.7%	8.4%	14.6%
Between 30 and 50	1.2%	8.5%	1.2%	11.0%
Over 50	0.2%	5.1%	0.3%	1.7%
Total	1.5%	8.9%	1.3%	9.2%

Voluntary turnover rate = ((annual voluntary leavers) / (average workforce)) * 100. Group (ex-TSB) data as at 31/12/2023. 'International' includes Mexico, foreign branches and representative offices.

			2023
National	International	National	International
2.0%	8.5%	1.8%	10.3%
1.0%	9.5%	0.9%	7.8%
1.5%	8.9%	1.3%	9.2%
		2024

Voluntary turnover rate = ((annual voluntary leavers) / (average workforce)) * 100.

⁵³ Rate that measures those leaving the Group (ex-TSB) on a voluntary basis

Involuntary turnover

The Involuntary Turnover Rate (ITR⁵⁴) of the Group (ex-TSB) was 1.14%. In Spain, the involuntary turnover rate was 1.10%. In the international perimeter, the rate decreased by 4.2 percentage points, mainly due to fewer staff departures in Mexico.

		2024	2023
Age range	National	International	National	International
Under 30	2.4%	3.5%	2.6%	4.9%
Between 30 and 50	0.7%	1.4%	0.8%	6.2%
Over 50	1.6%	2.0%	2.2%	6.1%
Total	1.1%	1.8%	1.3%	6.0%

Involuntary turnover rate = ((annual involuntary departures) / (average workforce)) * 100. Group (ex-TSB) data as at 31/12/2024. 'International' includes Mexico, foreign branches and representative offices. Includes those leaving due to dismissal and other involuntary reasons. Does not include those leaving due to restructuring processes.

		2024		2023
Gender	National	International	National	International
Men	1.3%	1.5%	1.5%	6.7%
Women	0.9%	2.1%	1.2%	5.3%
Total	1.1%	1.8%	1.3%	6.0%

Involuntary turnover rate = ((annual involuntary departures) / (average workforce)) * 100. Group (ex-TSB) data as at 31/12/2024. 'International' includes Mexico, foreign branches and representative offices. Includes those leaving due to dismissal and other involuntary reasons. Does not include those leaving due to restructuring processes.

Types of contract in the Group

Practically all Group employment contracts (99%) are permanent contracts, and only 188 are temporary.

Number of contracts, by type:		2024			2023
Type of contract and gender	Men	Women	Total	Men	Women	Total
Permanent	8,419	10,162	18,581	8,555	10,593	19,148
Temporary	93	95	188	86	82	168
Total	8,512	10,257	18,769	8,641	10,675	19,316

Group data as at 31/12/2024.

Number of contracts, by type:	2024			2023
Type of contract and	Permanent	Temporary	Total	Permanent	Temporary	Total
professional category
Senior management	865	1	866	788	3	791
Middle management	3,327	1	3,328	3,719	4	3,723
Specialist staff	12,520	162	12,682	12,276	142	12,418
Administrative staff	1,869	24	1,893	2,365	19	2,384
Total	18,581	188	18,769	19,148	168	19,316

Group data as at 31/12/2024. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

⁵⁴ Rate that measures those leaving the Group (ex-TSB) on an involuntary basis

Number of contracts, by type:	2024			2023
Type of contract and
age range	Permanent	Temporary	Total	Permanent	Temporary	Total
Under 30	1,660	112	1,772	1,948	97	2,045
Between 30 and 50	11,018	67	11,085	11,699	62	11,761
Over 50	5,903	9	5,912	5,501	9	5,510
Total	18,581	188	18,769	19,148	168	19,316

Group data as at 31/12/2024.

Number of contracts, by type:	2024			2023
Type of contract and	Permanent	Temporary	Total	Permanent	Temporary	Total
region
Spain	13,006	150	13,156	12,967	123	13,090
UK	4,723	38	4,761	5,412	45	5,457
Mexico	526	0	526	445	0	445
Other	326	0	326	324	0	324
Total	18,581	188	18,769	19,148	168	19,316

Group data as at 31/12/2024.

Functional diversity

The Group establishes measures for the adjustment of workstations where required by people with functional diversity, in line with the occupational medicine service's protocols relating to particularly sensitive individuals. The Institution also assists employees with paperwork and formalities at the municipality, autonomous community and State level that help to improve these employees' well-being beyond a strictly professional sense. Pursuant to the General Disability Law (Ley General de Discapacidad), it implements alternative supported employment measures by hiring services and supplies from special employment centres.

The number of people with functional diversity in the Group as at December 2024 was 287.

		2024			2023
Professional category	Men	Women	Total	Men	Women	Total
Senior management	5	1	6	5	4	9
Middle management	16	8	24	16	10	26
Specialist staff	81	125	206	86	118	204
Administrative staff	11	40	51	14	47	61
Total	113	174	287	121	179	300

Group data as at 31/12/2024. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

5.2.4.3. S1-8: Collective bargaining coverage and social dialogue

As described in section 5.2.3.2 S1-2. Processes for engaging with own workers and workers' representatives about impacts, in Spain, Banco Sabadell maintains continued and fluid dialogue with workers' legal representatives, in an environment that is conducive to dialogue and complete impartiality, so as to facilitate collective bargaining and resolve the issues identified in legislation, and to address any other matters that the company and union representatives consider to be material for its activity and the workplace environment.

In Spain, 100% of workers are covered by the Collective Bargaining Agreement, while in all other countries, the prevailing legislation in each country is applied. In addition, in Spain 100% of staff are represented by workers' representatives.

In the United Kingdom, TSB continues to maintain a fluid and direct relationship with trade unions, renewing its agreement with Accord and Unite in 2023, which establishes the collective bargaining agreements. The agreement was reached with 90% of the workforce represented. This relationship has allowed the management team to work in an open and collaborative manner to consult with trade union representatives on all issues affecting TSB's relationship with its staff, and to assess possible initiatives to make improvements to the workforce and introduce organisational changes.

In the subsidiary in Mexico, there is no relationship between people and union representatives.

	Collective bargaining coverage	Social dialogue
Coverage rate	Employees – EEA	Employees – non-EEA*	Workplace representation (EEA only)
0-19%
20-39%
40-59%
60-79%
80-100%	Spain	UK	Spain

Note: European Economic Area (EEA)

* Excludes Mexico as it represents less than 10% of total employees.

5.2.4.4 S1-10: Adequate wages

The Remuneration Policy ensures a competitive and fair remuneration system, in compliance with benchmark indices, that is capable of attracting and retaining the best talent, that is aligned with market standards and flexible enough to adapt to environmental changes and sector requirements, and that rewards professional experience and responsibility, irrespective of the employee's gender.

In this respect, the Policy applied in the Group is based on equal pay for male and female employees for equal work or work of equal value⁵⁵ .

5.2.4.5. S1-13: Training and skills development

The Annual Staff Training Plan is the basis for the development of Banco Sabadell's human team. Staff education and training are very important to the institution, which is why 97.8% of the Bank's employees received training during 2024, completing a total of 634,266 hours of training at the Group level (equivalent to an average of 23 hours per person).

As at June 2024, in Spain, 18% of the training received was voluntary, compared to 30% in 2023. Up to December 2024, 78% of the training was completed online, compared to 74% in 2023.

Training received	2024	2023
Employees who received training (%)	97.9%	96.7%

Active employees as at 31/12/2024. Training data refers to the entire Group.

Average training expense	2024	2023
Average training expense per employee	€526	€547

Active employees as at 31/12/2024. Training data refers to the entire Group.

	2024		2023
Total hours of training and average of each professional category	Hours of training	Average hours	Hours of training	Average hours
Senior management	35,785	42.8	40,390	52.7
Middle management	149,730	45.8	210,029	57.7
Specialist staff	508,188	41.1	541,051	44.8
Administrative staff	49,772	26.4	71,282	30.2
Total	743,474	40.5	862,752	45.8

Active employees as at 31/12/2024. Training data refers to the entire Group. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not

⁵⁵ For more details about the Remuneration Policy, see section 5.2.3.1 S1-1: Policies related to own workforce

included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

	2024		2023
Total hours of training and average of each age range	Hours of training	Average hours	Hours of training	Average hours
Under 30	91,421	52.6	117,253	58.9
Between 30 and 50	438,864	40.3	521,033	45.2
Over 50	213,189	37.1	224,466	42.1
Total	743,474	40.5	862,752	45.8

Active employees as at 31/12/2024. Training data refers to the entire Group.

	2024		2023
Total hours of training and average of each gender	Hours of training	Average hours	Hours of training	Average hours
Men	339,817	40.7	401,088	47.5
Women	403,658	40.3	461,664	44.3
Total	743,474	22.5	862,752	45.8

Active employees as at 31/12/2024. Training data refers to the entire Group.

5.2.4.6 S1-14: Health and safety metrics

Banco Sabadell Group adopts a policy of prevention and continuous improvement of people's working conditions and health that covers 100% of those working at Banco Sabadell Group. This preventive action is set in motion through the Prevention Plan, the aim of which is to ensure the integration of occupational hazard prevention in the structures of Banco Sabadell Group companies. The Plan is approved and reviewed by the State Health and Safety Committee (a collegial body with both representatives of the company and legal representatives of the workforce).

In 2024, the Comprehensive Health and Well-being Plan was implemented, with the aim of expanding and optimising the availability of resources and benefits to integrate conduct that fosters healthy habits and to improve the experience of the workforce in terms of their mental and emotional well-being, so as to foster a workplace environment that is good for their mental balance.

Based on the understanding of health as a state of complete physical, mental and social well-being, not just the absence of conditions or illnesses, all of the initiatives in this framework have been grouped together in Sabadell Live into four key pillars: physical well-being, mental and emotional well-being, financial well-being, and social well-being, all of which can be accessed from the corporate computer or corporate mobile phone.

The main new feature worth mentioning is the implementation of a Health Ecosystem, which offers the workforce free and confidential access to new health resources 24/7 and 365 days a year:

• Telemedicine service, accessible through a chat or video consultation, through which staff can receive a diagnosis and reports and obtain medical prescriptions, if necessary.
• Mental health services, accessible through a chat or video consultation, where they can be linked to a specialised therapist and access mental health resources.
• Telerehabilitation service, accessible through a chat with physical therapists and which can be used to design personalised exercise programmes to treat and prevent injuries.

In order to continue with the progress made, the Institution has designed a management system based on continuous improvement, thereby complying with Law 54/2003 on the reform of the regulatory framework on occupational hazard prevention. This management system is submitted to a specific external audit on a regular basis, the last of which took place in 2023. The results of that audit were fully satisfactory, detecting no Non-Conformities (not even minor ones) in any of the audited aspects.

Monitoring absence from work

As part of its management of health and safety, Banco Sabadell monitors absence from work through monthly reports, which include data on prevalence rates, severity rates, and frequency of absences. The data is grouped together by company, territory, age and gender, and makes it possible to detect trends and possible deviations depending on the variables analysed. Depending on the results, preventive actions are identified and applied.

General absence from work includes absence from work due to illness with Temporary Incapacity (TI) and without TI for common contingencies (common illnesses, non-work-related accidents) and professional contingencies, such as a Work-Related Accident (WRA) or a Work-Related Illness (WRI).

The data regarding the prevalence rate (number of employees who have been absent from work / total workforce) showed a decrease in 2024 compared to 2023, standing at 4.97% of the workforce (vs 5.10% in 2023).

The severity rate (number of days missed / total working days) was practically the same, at 2.95% (vs 2.94% in 2023). Considering the composition of the workforce in terms of gender and age, values below 3.5% are considered to be very satisfactory.

The number of new leaves of absence initiated in the month (frequency rate) has fallen compared to the previous year, with an average of 295 per month in 2024, compared with 307 in 2023.

At a sectoral level, according to the latest data available for 2023, absence from work due to illness stood at 2.94% in the Group compared with 3.43% across the financial sector and 7.41% in the services sector, even when considering that the information provided by mutual insurance companies (sector data) does not include data on illness without temporary incapacity, unlike the data supplied by Banco Sabadell, which does.

Indicators of absence from work in Spain	2024	2023
Total hours (accidents and ill health)	697,689	682,394
Data as at 31/12/2024.

Indicators of absence from work in TSB	2024	2023
Total hours (accidents and ill health)	331,788	354,396

Data as at 31/12/2024.

In Mexico, indicators of absence from work are recorded and reported as general ill health. As at the end of December 2024, a total of 19 days off work had been recorded.

Monitoring the accident rate

One of the fundamental pillars of the management of occupational hazard prevention is the research into, and prevention of, work-related accidents. On becoming aware of an accident, the Joint Prevention Service collects the main data and deals with the official communication. An investigation into the accident is launched. The procedure varies depending on the severity and complexity of the event, determining, if necessary, the preventive and/or corrective actions that should be taken. All of these actions are designed to guarantee the care and subsequent recovery of the person concerned. In 2024, there was a slight increase in the number of accidents compared to 2023 (a year in which we reached a record low figure for this aspect), but the number is still lower than in previous years, despite the increased size of the workforce. No severe accidents were recorded during the period, nor were there any fatalities as a result of work-related accidents.

Work-related accidents

		2024			2023
Types of accident in Spain	M	W	Total	M	W	Total
Work centre	8	36	44	5	32	37
Whilst commuting	26	40	66	28	41	69
Travel during workday	2	22	24	5	11	16
Other work centre	1	1	2	0	1	1
TOTAL	16	61	136	38	85	123

Data as at 31/12/2024.

		2024			2023
Work-related accidents in Spain	M	W	Total	M	W	Total
Total hours	5,584	14,667	20,251	4,946	10,517	15,463
Total days	1,199	3,149	4,348	1,062	2,258	3,320
Frequency rate56	1.02	4.85	3.05	0,95	3,66	2,39
Severity rate57	0.05	0.12	0.09	0,05	0,09	0,07

Data as at 31/12/2024. Rate calculations exclude accidents occurring whilst commuting.

In terms of subsidiaries, TSB, in compliance with UK legislation, does not keep a record of accidents, while Mexico did not record any accidents in 2024.

5.2.4.7 S1-15: Work-life balance metrics

Banco Sabadell Group's workforce has at its disposal the series of work-life balance measures set out in the Equality Plan and detailed in section 5.2.3.4. S1-4: Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions.

5.2.4.8 S1-16: Compensation metrics (pay gap and total compensation)

The monitoring and analysis of the factors and impacts associated with gender equality and equal pay are vital to ensure inclusive and fair working environments. The People division has internal processes for identifying and managing the impact of salary reviews in order to deliver on the corporate commitment of reducing the Institution's gender pay gap. Continuous monitoring, along with frequent reports sent to the Institution's decision-making bodies and annual reports sent to governing bodies for information and evaluation, is an essential prerequisite to achieve the established targets.

In its goal of promoting gender equality among its employees, Banco Sabadell makes the gender pay gap a priority focus area for its workforce management, launching mechanisms and initiatives to gradually reduce that gap, in fulfilment of the principles of its remuneration models and the guiding principles of the Group's Remuneration Policy.

⁵⁶ (Number of accidents (excluding those occurring whilst commuting) / theoretical working hours (according to collective bargaining agreement))* 1,000,000

⁵⁷ (Working hours lost/ theoretical working hours (collective agreement) * 100)

Pay gap based on average total remuneration*
	2024	2023
Spain	20.61%	21.08%
UK (TSB)	29.98%	29.88%
Mexico	20.51%	25.03%
Total	23.02%	23.69%

Pay gap based on median total remuneration*
	2024	2023
Spain	13.89%	13.86%
UK (TSB)	26.74%	26.11%
Mexico	11.74%	22.14%
Total	17.13%	17.56%

* The overall pay gap is calculated as the average pay gap of each country weighted according to the percentage that their workforce represents out of the total.

As at the end of 2024, the gross (unadjusted) overall gender pay gap in Banco Sabadell Group was 23.02% (average) and 17.13% (median). This indicator is calculated in accordance with Royal Decree 902/2020, in which total remuneration is calculated in real terms (annualised fixed salary, variable remuneration and any salary/non-salary supplements actually received) and represents the difference between male and female salaries in average terms or in median terms in an organisation / professional category.

The gross pay gap indicator does not provide a complete picture of differences in remuneration, nor can it be used to identify potential gender inequalities within the company. To do that, it is essential to employ statistical methods that permit the calculation of the portion of the gender pay gap that cannot be explained by other factors that might influence a person's compensation, such as their individual characteristics and those related to their job. The portion of the pay gap that remains when comparing individuals with similar characteristics whose only difference is their gender is known as the adjusted pay gap.

To address this, in 2023 Banco Sabadell worked in collaboration with the Economics and Business Department of the Pompeu Fabra University on the certification of an econometric model to determine the adjusted pay gap in Spain, with the following results:

Adjusted pay gap in Spain
	2024	2023
Pay gap based on average total remuneration	4.80%	5.27%
Pay gap based on median total remuneration	2.64%	2.90%

If the effect of staff- and job-related characteristics on pay is removed from the basic pay gap, the adjusted pay gap becomes 4.80% based on the average and 2.64% based on the median.

The introduction of additional factors, other than gender, that explain the remuneration reduces the pay gap. The inclusion of specific job-related characteristics goes a long way in explaining the observed pay gap. A more equal gender presence in the different categories and job functions would also contribute to reducing the aforesaid pay gap.

Remuneration of the Board of Directors

With regard to average pay, all members of the Board of Directors, both male and female, are remunerated according to the same criterion, i.e. the number of Board or Board Committee meetings in which they participate or, if applicable, that they chair, without any variation among them for any other reason.

	Average remuneration of the Board of Directors58
		2024		2023
	Members	Remuneration	Members	Remuneration
Men	9	363,824	9	329,501
Women	5	196,411	5	164,667
Total	14	304,034	14	270,632

Average remuneration is calculated by considering Board members who have served as directors during the entire tax year, excluding Board members who have not served for the full year. Remuneration received for work carried out in the capacity of members of the Board of Directors is calculated excluding any amounts received for management functions and excluding any amounts received for work carried out as members of the Advisory Board. This remuneration includes, as it has done since 2021, additional remuneration for the Non-Executive Chairman for his functions as Chairman of the Institution, Chairman of the Board of Directors and Chairman of the Annual General Meeting, as well as his functions as the most senior representative of the Institution and all other functions attributed to him by law, the Articles of Association or the Board of Directors itself. In 2024, average remuneration for male members of the Board without considering the remuneration for the Non-Executive Chairman was 206,177 euros.

Staff remuneration, by professional category, age and gender

Information is given here below regarding the remuneration received for work carried out during the year, broken down by geographical region, and for each professional category and age range.

The calculation of average total remuneration takes into account fixed remuneration as at year-end, variable remuneration, salary and non-salary supplements and benefits, as well as annualised remuneration and remuneration actually paid. This criterion has been applicable in all countries since 2021.

Average total remuneration in Spain
	2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	182,477	140,196	168,149	173,686	135,390	161,338
Middle management	80,042	71,157	76,240	74,320	62,197	68,937
Specialist staff	52,203	48,391	49,975	50,172	46,604	48,089
Administrative staff	29,199	28,746	28,897	29,039	27,976	28,304
Total	69,649	55,291	61,922	65,922	52,024	58,438

Data as at 31/12/2024. Average remuneration in euros. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	40,539	39,255	39,972	37,873	36,945	37,473
Between 30 and 50	64,429	53,887	58,441	61,636	50,737	55,415
Over 50	83,186	60,455	71,714	79,565	57,631	68,711
Total	69,649	55,291	61,922	65,922	52,024	58,438

Data as at 31/12/2024. Average remuneration in euros.

https://www.grupbancsabadell.com/corp/en/corporate-governance-and-remuneration-policy/corporate-governance-annual-report.html

⁵⁸ For further information on the remuneration of members of the Board of Directors, see the Director Remuneration Policy, the Annual Report on Director Remuneration and the Annual Corporate Governance Report published on the corporate website of Banco Sabadell Group (www.grupbancsabadell.com)

https://www.grupbancsabadell.com/corp/en/corporate-governance-and-remuneration-policy/director-remuneration-policy.html https://www.grupbancsabadell.com/corp/en/corporate-governance-and-remuneration-policy/annual-report-on-remuneration-ofdirectors.html

Average total remuneration in United Kingdom (TSB)
		2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	359,566	321,269	344,049	336,967	283,784	315,522
Middle management	146,902	139,964	144,050	134,877	127,160	131,560
Specialist staff	71,348	60,043	65,289	66,314	56,457	61,009
Administrative staff	37,486	33,339	34,550	35,408	31,532	32,631
Total	79,729	55,828	65,603	72,502	50,837	59,469

Data as at 31/12/2024. Average remuneration in euros. Exchange rate as at 31/12/2024: GBP 0.82918 = EUR 1. Exchange rate as at 31/12/2023: GBP 0.86905 = EUR 1. Workforce figures only include TSB's workforce; they do not include staff at Banco Sabadell's foreign branch in the UK. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	44,448	40,341	42,238	41,292	37,836	39,363
Between 30 and 50	82,031	60,610	69,554	76,864	54,433	63,649
Over 50	109,479	55,412	74,187	97,835	53,145	67,839
Total	79,729	55,828	65,603	72,502	50,837	59,469

Data as at 31/12/2024. Average remuneration in euros. Exchange rate as at 31/12/2024: GBP 0.829183 = EUR 1. Exchange rate s at 31/12/2023: GBP 0.86905 = EUR 1. Workforce figures only include TSB's workforce; they do not include staff at Banco Sabadell's foreign branch in the UK.

Average total remuneration in Mexico
		2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	237,443	167,483	214,525	262,326	173,372	231,534
Middle management	60,855	57,836	59,687	68,891	63,634	66,805
Specialist staff	26,517	24,032	25,529	28,775	25,453	27,322
Administrative staff	0	0	0	0	0	0
Total	71,390	56,748	65,772	81,639	61,204	73,381

Data as at 31/12/2024. Remuneration in euros. Exchange rate as at 31/12/2024: MXN 21.5504 = EUR 1. Exchange rate as at 31/12/2023: MXN 18.7231 = EUR 1. Remuneration figures do not include expatriated staff or staff at Sinia Capital, S.A. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	31,718	28,819	30,680	31,879	27,486	30,006
Between 30 and 50	68,248	58,137	64,161	79,209	64,685	73,164
Over 50	142,575	96,491	129,774	153,109	93,944	136,598
Total	71,390	56,748	65,772	81,639	61,204	73,381

Data as at 31/12/2024. Remuneration in euros. Exchange rate as at 31/12/2024: MXN 21.5504 = EUR 1. Exchange rate as at 31/12/2023: MXN 18.7231 = EUR 1. Remuneration figures do not include expatriated staff or staff at Sinia Capital, S.A.

Average fixed remuneration is calculated considering fixed remuneration as at year-end. This criterion has been applicable in all countries since 2021.

Average fixed remuneration in Spain
	2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	126,832	103,328	118,867	124,818	102,439	117,602
Middle management	59,512	53,341	56,871	57,274	49,082	53,636
Specialist staff	43,773	40,628	41,935	42,063	39,121	40,346
Administrative staff	26,711	26,726	26,721	24,951	24,759	24,818
Total	54,361	44,860	49,248	52,309	42,738	47,155

Data as at 31/12/2024. Average remuneration in euros. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category. In Spain, roles classified as technical roles are included in the 'Specialist staff' category, in accordance with the Collective Bargaining Agreement for Banks.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	35,922	34,845	35,446	34,508	33,490	34,069
Between 30 and 50	50,579	43,441	46,525	48,954	41,432	44,661
Over 50	63,639	49,120	56,311	62,059	47,382	54,796
Total	54,361	44,860	49,248	52,309	42,738	47,155

Data as at 31/12/2024. Average remuneration in euros.

Average fixed remuneration in United Kingdom (TSB)

	2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	232,464	211,514	223,976	216,993	193,174	207,388
Middle management	115,506	109,244	112,932	103,249	96,965	100,547
Specialist staff	54,885	45,934	50,088	50,022	42,074	45,745
Administrative staff	29,235	25,492	26,585	26,508	23,184	24,126
Total	60,117	42,231	49,546	53,489	37,546	43,899

Data as at 31/12/2024. Average remuneration in euros. Exchange rate as at 31/12/2024: GBP 0.82918 = EUR 1. Exchange rate as at 31/12/2023: GBP 0.86905 = EUR 1. Workforce figures only include TSB's workforce; they do not include staff at Banco Sabadell's foreign branch in the UK. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	35,255	31,424	33,193	31,839	28,769	30,125
Between 30 and 50	62,343	46,012	52,831	56,786	40,289	47,067
Over 50	79,319	40,982	54,295	70,245	38,439	48,897
Total	60,117	42,231	49,546	53,489	37,546	43,899

Data as at 31/12/2024. Average remuneration in euros. Exchange rate as at 31/12/2024: GBP 0.82918 = EUR 1. Exchange rate as at 31/12/2023: GBP 0.86905 = EUR 1. Workforce figures only include TSB's workforce; they do not include staff at Banco Sabadell's foreign branch in the UK.

Average fixed remuneration in Mexico
	2024			2023
Professional category	M	W	Total	M	W	Total
Senior management	143,242	100,087	129,105	171,277	106,680	148,917
Middle management	41,365	39,182	40,521	48,210	43,805	46,462
Specialist staff	19,793	17,569	18,909	21,909	19,200	20,724
Administrative staff	0	0	0	0	0	0
Total	46,872	37,604	43,316	56,079	41,441	50,164

Data as at 31/12/2024. Remuneration in euros. Exchange rate as at 31/12/2024: MXN 21.5504 = EUR 1. Exchange rate as at 31/12/2023: MXN 18.7231 = EUR 1. Remuneration figures do not include expatriated staff or staff at Sinia Capital, S.A. 'Senior management' includes executive directors, senior management, general management, corporate directors and top management. 'Middle management' includes directors not included in the 'Senior management' category.

		2024			2023
Age range	M	W	Total	M	W	Total
Under 30	22,831	20,832	22,115	24,319	20,990	22,900
Between 30 and 50	45,415	38,541	42,637	53,875	43,675	49,630
Over 50	87,411	60,400	79,908	105,800	59,874	92,983
Total	46,872	37,604	43,316	56,079	41,441	50,164

Data as at 31/12/2024. Remuneration in euros. Exchange rate as at 31/12/2024: MXN 21.5504 = EUR 1. Exchange rate as at 31/12/2023: MXN 18.7231 = EUR 1. Remuneration figures do not include expatriated staff or staff at Sinia Capital, S.A.

Banco Sabadell calculates the annual total remuneration ratio as the ratio of total remuneration of the highestpaid individual (excluding Executive Directors) to the median/average annual total remuneration of all employees. Total remuneration is calculated according to the specifications of Royal Decree 902/2020,

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applicable in Spain, whose criteria have been extrapolated to other geographies, considering fixed remuneration in annualised terms and all other components based on the sum actually received in the past 12 months. Uniform criteria are applied, both in the calculation of this ratio and in the corresponding pay gap indicators.

Median/average annual total remuneration for all employees (excluding the highest-paid individual) is calculated as the weighted average of the median/average remuneration of each geography according to the weight of the total workforce of each country, without applying any correction factor linked to the cost of living in each country.

In 2024, the remuneration of the highest-paid individual was 30.06 times higher than the median remuneration of all other employees and 22.26 times higher than the average remuneration.

5.2.4.9 S1-17: Incidents, complaints and severe human rights impacts

The Group has not received any workplace complaints related to human rights from its own workforce, nor any complaints of forced or child labour.

On the other hand, in 2024 the Harassment Prevention Committee dealt with a total of 16 complaints of harassment, all in relation to workplace harassment.

In 2024, there were no records of any penalties or compensation for injury and damages as a result of any cases of discrimination and harassment.

In addition, 43,101 consultations were received from the Assistance and Grievances Office (AGO) detailed in section 5.2.3.3. S1-3: Processes to remediate negative impacts and channels for own workers to raise concerns.

5.3 Social: Consumers and end-users

5.3.1 Introduction

As a financial institution, Banco Sabadell plays a fundamental role in building an inclusive and decarbonised economy. On one hand, mobilising resources, identifying technologies and creating opportunities and, on the other, incorporating new capabilities with an in-house transformation to embed sustainability into all agendas, managing the risk of its customer portfolio, minimising the impact of ESG risks and financing a large part of the investments needed to honour the Paris Agreement, the European Green Deal and the 2030 Agenda.

The main courses of action are the following:

• Support customers in the transition to a sustainable economy: to that end, the Institution takes steps to establish decarbonisation pathways, support customers in the transition with specialised solutions for renewable energy, energy efficiency and sustainable mobility, and it also defines sectoral standards that limit controversial activities and/or activities with negative impacts on social and environmental development.
• Offer investment opportunities that contribute to sustainability: in the investor ecosystem, the Bank focuses on increasing opportunities for savings and investment that contribute to sustainability, rolling out a wide range of social, ethical, green and sustainability bonds and funds, both its own and those of third parties.
• Work together for a sustainable and cohesive society: in its commitment to society, the Institution believes that it is imperative to take an active role to improve financial education, drive forward inclusion, minimise vulnerabilities and ensure secure transactions and exchanges of information.

In this way, Banco Sabadell contributes to the transition towards a more sustainable and cohesive society through ethical and responsible management. The Bank is also committed to data privacy and cybersecurity.

It promotes volunteering, education and financial inclusion, as well as charitable activities. It pays particular attention to supporting customers in vulnerable situations with social housing management initiatives and employability programmes.

Through the Banco Sabadell Foundation, outreach, training and research activities are promoted in the fields of education, science and culture, and support is provided to young talented individuals so that they may achieve a more prosperous and promising future.

5.3.2 Strategy

5.3.2.1 ESRS 2 SBM-2: Interests and views of stakeholders

Customers (Banco Sabadell Group's retail and business customers) and Society (citizens, communities and organised civil society) are two stakeholder groups identified in the double materiality exercise carried out and described in section 3.2 SBM-2: Interests and views of stakeholders.

As indicated in that section, when conducting the double materiality analysis, the interests and views of both groups have been taken into account. In this respect, the group of Customers (both retail and business) has been analysed through questionnaires, which asked them about the topics related to sustainability that directly concerned them. To determine the interests of Society, the Group's internal documentation, as well as reports and public documentation, has been analysed (notably the Sustainability Regulation, non-financial regulations, reports on global trends, indices and ESG ratings and sector trends) in order to complement the analysis.

5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

The Group has identified the material positive and negative impacts, risks and opportunities related to consumers and end-users. These have been grouped into the following topics: Access to products and services, Non-discrimination, and Cybersecurity and data protection. They have also been defined based on the impact materiality assessment and the financial materiality assessment described in section 3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model.

Several areas in which the aforesaid topics come into play with the Bank's business model and for which several initiatives⁵⁹ are being carried out have been identified:

Vulnerable customers

The Bank is currently monitoring the evolution of its vulnerable customers (understood as customers who, due to personal, economic, educational or social needs or circumstances, are in a situation of special dependency, defencelessness or lack of protection that prevents them from exercising their rights on an equal footing), mainly in three areas: financial, digital and regional vulnerability. In 2024, further progress was made in updating the criteria used to identify potentially vulnerable customers in order to ensure consistent criteria and actions.

Financial vulnerability:

The first area is financial vulnerability, i.e. low-income customers. During 2024, the Institution has continued with its identification of financially vulnerable customers to ensure they are managed appropriately. The actions taken are outlined here below:

a. Basic Payment Account:

Since 2019, the Bank has been offering its Basic Payment Account, which is a current account designed to offer access to basic banking services to everyone, irrespective of their economic circumstances. Its most noteworthy features include the option to conduct essential banking transactions such as cash deposits, cash withdrawals, debit card payments and transfers.

This financial product is particularly beneficial for vulnerable groups, as it has no minimum or maximum income requirements and it offers flexible terms and conditions for opening and using the account. Protection measures in relation to financing have also been kept in place, to ease their financial burden and prevent over-indebtedness.

⁵⁹ In addition, section 3.1 SBM-1: Strategy, business model and value chain provides more information about access to products and services

In 2024, the Institution has taken action to publicise the main features of the Basic Payment Account, through communication initiatives (focusing on customers in vulnerable situations). Specifically, it followed a new process to send information to a selection of customers who were thought to be potentially vulnerable in financial terms (sending 5,711 messages in total), informing them of the existence of the Basic Payment Account.

b. Measures for those affected by the DANA flash floods of October 2024:

In addition, in response to the DANA flash floods that took place in October, the government of Spain launched its response plan called the Plan de Respuesta Inmediata, Reconstrucción y Lanzamiento, first articulated in Royal Decree-Law 6/2024 of 5 November, later in Royal Decree-Law 7/2024 of 11 November and, finally, in Royal Decree-Law 8/2024 of 28 November. These decree-laws included a set of measures aimed at addressing the liquidity needs of households, self-employed professionals and businesses.

The measures included the launch of a special DANA guarantee facility with up to 5 billion euros and the introduction of a statutory moratorium for households, self-employed professionals and businesses (with turnover of up to 6 million euros), for a three-month period on the payment of interest and principal on their loans and a further nine months for payments of principal.

As for Banco Sabadell, as at the end of 2024, 1,229 statutory moratoria had been arranged for a total amount of 57 million euros, distributed between 644 transactions granted to households amounting to 32 million euros, 250 transactions granted to self-employed professionals amounting to 11 million euros, and 335 transactions granted to companies amounting to 14 million euros, as well as one ICO guarantee transaction amounting to 3 million euros.

c. Training for debt recovery teams:

A lot of time, effort and resources go towards training the teams that specialise in debt recovery, in order to offer solutions to this group, notably by offering them the option to request the application of the Code of Good Practice following the impact of the new mortgage code published in December 2022 and revised in December 2023 and now with the new updates of Royal Decree Law 7/2024 as a result of the urgent measures put in place for those affected by the DANA flash flood. Work is also still underway to design actions that will minimise the impact of rising interest rates on customers who cannot benefit from the application of the special measures provided in the Code of Good Practice.

Digital vulnerability:

The second area is digital vulnerability, i.e. customers who experience difficulties accessing and using online/ digital banking services or who have difficulty using ATMs. In relation to this group, in 2024 the Bank implemented various initiatives to reduce the digital divide among its customers (see section on that topic in 5.3.3.4 S4-4: Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions).

Regional vulnerability:

The third area relates to customers with regional vulnerability, i.e. customers located far away from the Institution's infrastructures and who have difficulties in accessing cash.

a. Mobile branches:

Banco Sabadell has five mobile branch vehicles operating on different routes, three of them in Asturias, one in Galicia and one in the province of Leon. The routes in Asturias serve customers in 17 different towns, while those in Galicia and Leon cover 5 and 3 locations, respectively.

In 2024, work continued on the development and evolution of protocols such as the strategic protocol to reinforce banks' commitment to society and sustainability (Protocolo Estratégico para Reforzar el Compromiso Social y Sostenible de la Banca) in relation to measures to foster financial inclusion, already mentioned in the previous section.

b. Agreement with Correos in relation to cash withdrawals:

Lastly, on 19 November 2024, Spain's national mail service (Correos) and Banco Sabadell signed an agreement to allow the Bank's customers to make cash withdrawals at its 2,388 ATMs located at post offices throughout Spain and through the 6,000 postal operatives that provide key services to citizens at their homes across the entire national territory. Thanks to this agreement, any citizen that has a bank account with Banco Sabadell may access the cash withdrawal service at one of the mail service's 8,200 customer service points. This has improved financial inclusion throughout the national territory, providing easier access to cash for all citizens in Spain, both those residing in rural areas and those more affected by the digital divide, which can also have positive results for the economic development of more sparsely populated rural areas.

Accessibility:

Furthermore, through the European Accessibility Act (EAA), the European Union aims to take a further step towards removing barriers in the use of products and services for people with disabilities. Against this backdrop, in order to take a step forwards in social inclusion, Banco Sabadell has defined an internal action plan under which it will gradually adapt its products and services in order to deliver universal expectations in terms of accessibility.

These amendments aim to ensure that the various groups can operate autonomously, both when applying for bank products and services and when using them.

The Bank is taking action to make all of its channels of interaction, as well as the physical products offered to provide banking services, accessible to all.

In the branch network, it is working to ensure suitable transit routes and to provide an adapted customer care model, for example, offering contract documents in Braille or the option to arrange an appointment with a sign language translator who can join remotely. It is also making its ATMs more accessible, ensuring that they can be used without obstacles and with adapted features.

In addition, it is working to make its digital channels more accessible. This involves implementing the international recommendations of the Website Content Accessibility Guidelines (WCAG) in its mobile app and on its commercial website.

In the same way, customer care services are being optimised, both through the telephony channel and through the virtual assistant, in order to improve their ease of use and adaptability.

Contract documents are also being adapted, wording them with a level of complexity no higher than the B2 level provided in the Common European Framework of Reference for Languages, as are its payment solutions, for instance, offering retail outlets the option to add accessibility features to their point-of-sale terminals and offering customers the option to request cards in Braille format.

BStartup

Banco Sabadell's BStartup is a financial service for startups (innovative companies that sell products and/or services through the use of technology, with a scalable business model that permits rapid and continued growth) and for scaleups (companies with traction and with turnover and/or investment in excess of €1m). It provides these companies with a 360° service of specialised banking and equity investment.

As at 2024 year-end, BStartup had 5,502 startup customers. These are very internationalised customers that frequently engage in complex banking activities that require highly specialised managers and services, which are offered through a distribution model formed of 23 'pure' BStartup agents operating in Madrid, Barcelona and Valencia, and 23 branches with different levels of specialisation located throughout the country.

In terms of equity investment, it is aimed mainly at early-stage digital and technology companies with strong growth potential and scalable, innovative business models. In 2024, €650,000 were invested in 7 startups.

BStartup invests in all types of sectors, although it maintains its investment verticals:

• In 2024, it launched the fourth call for proposals under BStartup Green to invest in startups that use technology or digitalisation to facilitate the transition to a more sustainable world (from the point of view of the energy transition, industry 4.0, smart cities and the circular economy). 119 companies submitted proposals under this fourth call.
• In 2024, the seventh edition of BStartup Health was launched. It is a programme designed to support health projects, in which invested funds are primarily used to validate technology, research and business. For the first time this year, the investment in each selected health project was increased to a maximum of 200,000 euros. The call for proposals ended with 105 enrolled startups.

During 2024, BStartup took a very active role in the main events of the entrepreneurial ecosystem. BStartup's team actively participated in 106 entrepreneurial events held throughout Spain.

Another milestone reached in 2024 was the opening to the public of the BStartup Hub Madrid, Banco Sabadell's first hub dedicated exclusively to startups, scaleups and their investors. It is an entrepreneurial and technological hub with a team of 12 people who offer a 360º financial service that is 100% specialised in startups. The hub's opening also means that Madrid has a new space for its entrepreneurial ecosystem, as it will also serve as a new space for conversation and discussion.

Sogeviso

Banco Sabadell manages social housing through Sogeviso (a wholly-owned subsidiary created by the Bank in 2015) in order to responsibly tackle the social exclusion of its vulnerable mortgage customers and the loss of their primary residence.

In its nine years of activity, Sogeviso has managed around 23,000 contracts for social or affordable rent and it has helped some 8,500 families improve their social and economic situation through its programmes designed to offer social support and improve employment prospects (JoBS). Of these 8,500 participants of the social support programme, 4,809 families improved their social and economic situation.

As at 31 December 2024, Sogeviso managed 2,311 properties under social and affordable rental arrangements specifically aimed at these vulnerable customers. In 9% of these cases the 'Social Contract' remained in place.

The Social Contract is an innovative model for managing vulnerable customers. It is a service for customers with a means-tested social rental arrangement that offers specific support provided by a social manager based on three independent lines of approach: connect these customers with public services, offer them training about personal finances, and facilitate access to public aid and the JoBS programme.

The JoBS programme is a job placement service that aims to provide customers with skills and tools to enable them to access the labour market, as well as market research to match profiles with existing job offers. Since the launch of the Social Contract in 2016, a total of 2,394 people have found work thanks to the JoBS programme.

As at the end of 2024, the Social Contract has helped 217 families and 20 people have been actively searching for employment through JoBS.

In addition, Banco Sabadell has assigned 80 properties to 38 non-profit institutions and/or foundations, aimed at supporting the most disadvantaged social groups, and since 2013 it has been a member of the Social Housing Fund (Fondo Social de la Vivienda, or FSV), contributing 419 homes intended mainly for customers and acquired through deeds in lieu and repossessions. Of the FSV housing stock, 96% is let out under social rental agreements currently in effect.

Code of Good Practice

Banco Sabadell adheres to the Code of Good Practice (Código de Buenas Prácticas, or CBP) enacted by Royal Decree Law (RDL) 6/2012 of 9 March and to its subsequent modifications, the latest of which was introduced by RDL 19/2022, extended by the Council of Ministers Agreement of 22 November 2022, whose main objective is to arrange for the viable restructuring of mortgage debt for primary residences, which is aimed both at families struggling to keep up with their mortgage payments because they are on the 'exclusion threshold' and at persons in vulnerable situations. On 16 December 2022, Banco Sabadell also voluntarily signed up to the new Code of Good Practice introduced by Royal Decree Law 19/2022, amended by an Agreement of the Council of Ministers dated 27 December 2023. In 2024, it arranged 479 debt restructuring transactions under the two aforesaid codes.

Cybersecurity

In 2024, the volume and sophistication of cyberattacks continued to increase. The Institution has adjusted its controls, increasing its capabilities to prevent, detect and respond to major cyberthreats.

Banco Sabadell Group, in line with its internal security control framework, continuously monitors the cybersecurity risks to which it is exposed, in order to protect its information systems and corporate information, as well as information pertaining to customers, employees and other stakeholders.

This control framework, which is updated and expanded on a regular basis, includes the updated Information Systems Security Policy, the definition of cybersecurity responsibilities across the three lines of defence and in governing bodies, the control standards required to ensure the protection of information systems, and the continuous evaluation of the effectiveness of its cyberdefences. This control framework is aligned with regulations applicable to the financial sector and with good cybersecurity practices, such as the NIST Cybersecurity Framework and Standard ISO 27001.

The Information Security function sends regular cybersecurity status reports to governing bodies, such as the Management Committee, the Board Strategy and Sustainability Committee and the Board of Directors, which are the bodies responsible for overseeing the Institution's cybersecurity, along with the Board Risk Committee, which oversees ICT risks. In addition, the Board of Directors is the body responsible for approving the Information Systems Security Policy.

This policy applies at the Group level, so it includes information that covers the entire banking business perimeter, taking into account the Banco Sabadell brands that operate in Spain; TSB, which operates in the United Kingdom; and Banco Sabadell Mexico, which operates in Mexico.

Banco Sabadell Group's in-house cybersecurity team is formed of over 100 specialist staff dedicated to ensuring that protection measures are appropriate to the existing cybersecurity risks. To that end, the following activities are carried out on a regular basis:

• Analysis of new cyberthreats and their development, enhancement of controls and assessment of risks.
• Review and execution of ongoing checks on information systems and security controls, including certifications carried out by external auditors.
• Preparation for incidents, through training, drills and simulated cyberattacks.
• Training and awareness-raising campaigns for staff and partners that include awareness-raising communications and regular drills.
• Awareness-raising communications regarding cybersecurity risks and digital fraud for customers, which can be distributed by email, using digital channels or ATMs, or through social media campaigns.
• Annual training courses in relation to data protection and cybersecurity, which are mandatory for all employees, as well as specific training programmes for the cybersecurity teams.

Through the Information Security function, Banco Sabadell Group entities establish measures for the protection of information systems, which are set out in policies and procedures, to guarantee secure access to systems and to deal with new cyberthreats. These measures include:

• Role-based access control and regular recertification of these permissions.
• Robust authentication of remote access by employees and suppliers.
• Advanced malware protection systems.
• Systems for monitoring and correlating security events.
• Systems to collect and analyse cyber-intelligence data.
• Security incident response team, available 24 hours a day, 7 days a week, which is in contact with other Security Operations Centres (SOCs).

With these capabilities for protection, detection and response to cyber threats, the Institution has not suffered any major cybersecurity incidents in 2024, adequately mitigating any cyber-related incidents affecting suppliers.

Banco Sabadell Group engages third-party specialists to run advanced cybersecurity tests, which evaluate the effectiveness of its key controls by simulating realistic cyberattacks. These verifications, which consider commonly used cyberattack techniques, prepare and train teams responsible for cyber defence, thus improving the levels of protection.

These tests also use well-renowned automated verification tools that simulate multiple cyberattacks. The Group's various entities also pay attention to the main external ratings that measure cybersecurity (Bitsight, RiskRecon, Security Scorecard). Banco Sabadell Group has secured positions in the top spots of these ratings in comparative terms with the rest of Spain's banking industry.

The various Banco Sabadell Group entities also endeavour to ensure the resilience of their infrastructures, making sure they have redundant components and regularly tested recovery procedures in order to guarantee the continuity of technological services in the event an incident occurs, such as a disaster affecting the facilities or a cyberattack.

In addition, every quarter, Banco Sabadell Group carries out drills that simulate cyber incidents, training the Institution's teams to detect and contain cybersecurity events and to recover operating services to minimise potential impacts.

Its financial statements are also subject to annual statutory audits and an external audit takes place, focusing on the design, implementation and operational effectiveness of its cybersecurity controls, carried out following the main information security standards.

In addition, Banco Sabadell Group's cybersecurity specialists participate in digital transformation initiatives and technological projects, assisting with the assessment of security risks, defining the security controls and measures to be incorporated and carrying out technical security tests to check that no vulnerabilities are introduced.

Among the digital transformation initiatives designed and rolled out securely with the participation of the cybersecurity team, it is worth highlighting new financial products and services, such as those detailed in the "Digital transformation and customer experience" section of the consolidated Directors' Report.

Data protection

To ensure that personal data is processed pursuant to applicable data protection regulations, the Institution has a mechanism that comprises three lines of defence, through which all members of the organisation, from all areas, in line with their authority and discretions, actively take part in the management, control and supervision of the Institution's data processing activities.

Banco Sabadell has a Data Protection Officer (DPO) who has been duly entered in the register of the Spanish Data Protection Agency (Agencia Española de Protección de Datos, or AEPD), and who advises the different areas of the Bank in order to ensure compliance with regulations. Every year, the DPO reports to the Board of Directors, providing relevant information about the existing data protection risks.

Following the management model built around three lines of defence, the Bank has the following action framework:

First line of defence
Centralised Operations:	– Unit responsible for designing and executing procedures concerning data subjects' rights in relation to data protection.
	– Designs the procedure for obtaining consent and a legitimate basis for data processing and traceability.
Information	– Designs security measures commensurate with the risks associated with personal data processing.
Security	– Performs impact assessments of personal data processing activities.
Management:	– Keeps a record of security breaches and defines criteria and protocols for notifying data subjects and, where applicable, the Control Board.
Data:	– Enters all data processing activities declared by accountable units in the Data Processing Activities Log.
	– Keeps information about international data transfers and their publication on the appropriate channel, where applicable, up to date.
Supplier Management:	– Ensures that management units wishing to engage the services of a third-party supplier adequately identify the associated personal data processing requirements and coordinates and manages the adaptation of contracts to prevailing legislation.
Contract-Related Legal Advice:	– Writes clauses related to data protection for both contracts entered into with suppliers and those entered into with customers and data subjects.
	– Assesses the regulatory impacts on the organisation of potential sector-specific regulations.
Marketing/ Product:	– Ensures that commercial data processing activities take place based on suitable legitimate grounds. Seeks the consent of data subjects and determines legitimate interest.
Data controllers:	– Lead the design and implementation of training and awareness-raising plans on the topic of data protection, requiring the involvement of each accountable unit.
	Second line of defence
Compliance:	– Determines the controls needed to ensure compliance with data protection legislation.
Data Protection	– Liaises with the Control Board and represents the Institution in various data protection forums.
Officer (DPO):	– Determines the need to give notice and, where applicable, gives notice of a security breach.
	– Deals with queries and complaints submitted by data subjects.
	– Provides information and advice to the data controllers and their employees regarding the obligations established in data protection legislation.
	– Defines the data protection policy.
	– Advises and oversees the correct implementation of the data protection regulation.
Internal Control:	– Receives information from Compliance regarding the effectiveness of the controls implemented by the first line of defence to mitigate compliance risks and any instances of non-compliance, together with the corrective measures taken, in order to carry out a joint assessment to be submitted to the corresponding governing bodies, and to align the controls with the established risk tolerance levels.
	Third line of defence
Internal Audit:	– Supervises the activities of the first and second lines of defence.
	– Reviews the control environment.
	– Reviews the fulfilment and effectiveness of policies and procedures.

The aforementioned mechanisms are set out in Banco Sabadell's Personal Data Protection and Privacy Policy, designed by the Institution as an internal organisational instrument to ensure the protection of natural persons in connection with personal data processing.

This policy is applicable to all personal data processing activities that take place in Banco de Sabadell, S.A., both automated and non-automated.

The aforesaid document indicates the policies and related procedures and defines the management and control model established in relation to data protection. The Personal Data Protection and Privacy Policy is published on the Bank's work tool and is available to all employees; it is reviewed annually and approved by the Board of Directors.

All of the Bank's employees complete, as mandatory training, a course on personal data protection and, depending on the professional duties of each employee, they also receive specific training imparted by the Data Protection Officer (DPO). In addition, through the Bank's various communication channels, employees receive 'brief training capsules', written in a friendly and visually pleasing way, which are used to convey short and direct messages to remind employees of their obligations in relation to data protection. This year, specifically, the Bank decided to launch a video series, comprising six chapters in all, in which the Bank's DPO directly addressed employees to remind them of certain obligations in that regard.

The Bank publishes information relating to its "privacy policy" and "privacy notice" on its website, in the section on customer information. This document, called "Annex of detailed information on personal data protection"⁶⁰ , which contains mandatory information about the various personal data processing activities carried out by the Institution, is published in all of Spain's official languages and also in French, English and German. This document, available to all interested parties, is continuously updated to include the new data processing activities launched by the Institution. The Personal Data Protection and Privacy Policy also applies to the engagement of third-party suppliers and the instructions that those suppliers receive are in line with the Bank's own Privacy Policy.

The Institution has a procedure for analysing and evaluating security incidents to determine whether an incident concerns personal data and should therefore be considered a security breach. These security breach assessments are carried out by the Data Protection Officer and are duly documented and made available to the Control Board.

The findings of the security breach assessment may require the Control Board and even the data subjects themselves to be notified in cases where the rights and freedoms of the data subjects could be at risk. 14 security incidents were recorded in 2024, but it was not necessary to inform either the Control Board or the data subjects.

In the United Kingdom, TSB has a Data Privacy Policy that requires personal data to be processed correctly and legally and used only for specific purposes. Where data is transferred to or processed by a third party, that data will be subject to a suitable due diligence process and transferred only for legitimate operational or commercial purposes. This policy is published on the corporate intranet and is available to all employees. It has been approved by TSB's Executive Policy Owner.

The subsidiary has its own Data Protection Officer (DPO).

Responsibility for complying with the Data Privacy Policy lies with the first line's business areas and the heads of each business area take on the agreed responsibilities.

TSB carries out annual training dedicated to privacy and data protection, which all employees are required to complete on an annual basis. TSB's DPO reviews the content to verify that it addresses all the required topics before approving it.

In addition, there are several central controls that business areas are required to adopt. The Data Privacy Office tests the design and operational effectiveness of the controls on an annual basis. Reports are also submitted on a regular basis to risk committees and other governance forums.

As for Banco Sabadell Mexico, in accordance with Mexican personal data protection legislation, this subsidiary complies with the Personal Data Privacy Manual, to which all employees have access through SharePoint.

The aim of the manual is to establish and define policies and procedures in relation to personal data protection and privacy so that staff authorised to process personal data may engage in legitimate, controlled, informed and appropriate processing of the personal data of customers, users, suppliers and partners, whether through physical or electronic means.

This involves considering legal and regulatory factors established in the Law on Credit Institutions, in commercial legislation, recommended banking-related and commercial uses and practices, in local and federal civil legislation, and in the various secondary laws and standards governing the Institution, linked to its operation, obligations and responsibilities.

⁶⁰https://www.bancsabadell.com/cs/Satellite/SabAtl/Customer-information/

GBS\_Generico\_FA/1183016790073/1191332198208/en// > Other relevant information > Annex - Detailed information on personal data protection

The Assistant General Managers of Compliance and Legal Advice hold the highest level of responsibility in the company for the application of the manual.

There is also a Process for Upholding Rights of Access, Rectification, Objection and Erasure/Right to be Forgotten. The aim of this process is to establish and provide regulatory and legislative alignments so that the Bank may accommodate requests to exercise those rights and deal with any complaints or non-conformities in relation to its processing of customers' and users' personal data. The document is aimed at the Data Protection Officer and at those collaborating with the Bank that are subject to the procedure and whose functions require them to take certain actions in relation therewith. Together, they are responsible for dealing with requests to exercise the above rights, as well as any claims, complaints and non-conformities put forward by customers and users.

5.3.3 Impacts, risks and opportunities management

5.3.3.1 S4-1: Policies related to consumers and end-users

Commercial communication

One of Banco Sabadell Group's priority goals is to meet the needs and expectations of consumers and endusers. In this regard, the Institution promotes transparent information and responsible, straightforward and friendly communication with its customers.

To that end, it acts in a socially responsible way in its commercial communications, undertaking to engage in lawful, proper, loyal, truthful, clear and transparent publicity, based on respect for people's dignity and the recognition of the rights and interests of consumers, and aligning with the principles of fair competition in business, as established in the Commercial Communication Policy.

Banco Sabadell's Commercial Communication Policy establishes, as a general criterion regarding format and content, that when designing publicity campaigns and each of the publicity elements that comprise them, it will be necessary to consider the nature and complexity of the product or service being offered, the characteristics of the distribution methods used, and the target market at which they are aimed. In this way, it complies with the various legal standards on the recognition and protection of the rights and interests of consumers. Banco Sabadell's Board of Directors is responsible for approving the Commercial Communication Policy. This Policy is available to all employees on the corporate intranet and its scope of application is all marketing activity carried out by Banco Sabadell in the Spanish territory under any of its commercial brands, including all commercial communications and information aimed at the general public (customers, potential customers, investors, etc.).

In addition, the Bank fosters transparency in the disclosure of information, at all times adopting responsible communication practices that prevent the tampering of data and protect the company's integrity and honour, in accordance with the recommendations of the Good Governance Code of Listed Companies of the Spanish National Securities Market Commission (CNMV).

Furthermore, with the entry into force of the Markets in Financial Instruments Directive II (MiFID II) and the Insurance Distribution Directive (IDD) in 2018, Banco Sabadell prioritises the provision of advice as the service delivery model for the distribution of financial instruments. The Institution has a tool called "Sabadell Inversor", which serves as a guide for relationship managers to recommend the products best suited to the characteristics and needs of customers, by analysing their experience, knowledge and preferences in relation to sustainability.

The information provided to customers, following the guidelines of those directives, is always impartial, clear and unambiguous. Furthermore, since March 2021, Banco Sabadell has been complying with obligations on sustainability disclosures in relation to products affected by Regulation (EU) 2019/2088, also known as the Sustainable Finance Disclosure Regulation (SFDR).

In accordance with its policies and procedures, the Bank has mechanisms in place to ensure that all information provided to customers is transparent and that all of the products and services which it offers are suited to their needs at all times. To this end, before marketing a new product or service, an internal workflow ("Product Workflow") is followed, where the relevant areas of the Bank review the various aspects to ensure they conform to the established standards. The subsequent validation by the areas involved is ultimately ratified by a highlevel committee, the Technical Product Committee. This validation process allows the Institution to identify the target audience at which the product should be aimed, in other words, the group of customers whose interests, objectives and characteristics fit with the conditions of the product, and to identify products that are aligned with their preferences regarding sustainability, as established in MiFID II and the IDD.

Furthermore, every year, the different units responsible for the product offering perform an in-depth review of the conditions of the products and their impact on customers in order to ensure that those products continue to be suitable for the target audience defined originally. This review process falls within the obligations required by various customer and investor protection regulations, such as the Guidelines on Product Oversight and Governance Arrangements for Retail Banking Products and the MiFID II Directive. In the branch network, relationship managers have access to various items of information about products and services, which enable them to provide the necessary explanations so that customers and consumers may understand their characteristics and risks. This information is complemented with the corresponding pre-contractual information documents delivered to customers.

It should be mentioned that, since 2010, the Bank has been a member of Autocontrol (independent advertising self-regulatory organisation in Spain) and has followed its codes of conduct. In this way, it takes on the commitment of offering responsible advertising to ensure that its commercial communications meet the ethical standards applicable to the basic principles of publicity, authenticity and the need for veracity, to advertising forms and techniques, and to the protection of children, adolescents and health. It also takes on the commitment of ensuring that its commercial communications comply with the specific regulations of the Bank of Spain on the advertising of bank products and services and those of Spain's National Securities Market Commission regarding the advertising of investment products and services.

As for TSB, the UK subsidiary is committed to producing and publishing responsible advertising and communications across the full range of propositions offered both as TSB and with its associated third-party suppliers. In this way, it meets the information needs of customers by ensuring that information is presented in a balanced, fair, clear and unambiguous way. TSB's Customer Communications and Product Promotion Policy is a reflection of the UK and, where appropriate, EU regulatory environment. The Policy is the remit of the Chief Marketing Officer, who takes responsibility for its rollout and supervision. The Chief Customer Officer is the executive owner of the Policy.

The purpose of the Policy is to set out key processes, controls, and responsibilities enabling TSB to meet all relevant regulatory requirements including in acting to deliver good outcomes when communicating to/with its customers, across all channels and customer communications, including financial promotions. TSB has no appetite for unfair customer outcomes and this Policy and its associated controls are designed to mitigate conduct risk and prevent the occurrence of customer harm arising from its communications or any other dealing they may have with TSB.

Banco Sabadell Mexico, on the other hand, in accordance with Mexican banking regulations, is transparent in its publication of product-related information. For this reason, the official website of Banco Sabadell Mexico, in the section on financial products, indicates the products that are offered and includes standard-form agreements currently in effect and product information sheets, which specify the terms, conditions, application requirements and fees of the various products.

The website also contains the costs and fees document, which sets out the costs, returns and fees of the products. The total annual rate of return (Ganancia Anual Total, GAT) on deposits is also shown, in accordance with the provisions of the Bank of Mexico.

Human rights

In carrying out its activities, Banco Sabadell Group respects, upholds and protects internationally recognised fundamental human rights in all territories in which it is present, taking into consideration the internal and external relationships it enters into with all of its stakeholders: employees, customers, suppliers and the communities and environment in which it operates. The Group has a Sustainability Policy, ratified by the Board of Directors in 2021, which is reviewed annually and which includes a specific principle concerning respect for internationally recognised fundamental human rights. In 2024, the Bank's subsidiaries with business activities in other geographies ratified their adherence to Banco Sabadell Group's Sustainability Policy at their respective Board meetings.

This policy applies at the Group level, so it includes information that covers the entire banking business perimeter, taking into account the Banco Sabadell brands that operate in Spain; TSB, which operates in the United Kingdom; and Banco Sabadell Mexico, which operates in Mexico.

This commitment is underpinned by, among other things, the Guiding Principles on Business and Human Rights, the Universal Declaration of Human Rights, the International Labour Organisation's Declaration on Fundamental Principles and Rights at Work, and the United Nations Principles for Responsible Investment.

These commitments have been reinforced by the decision to sign certain important national and international agreements on human rights, including:

• The United Nations Global Compact, which encompasses human rights and labour rights in its first and second set of principles. The Group undertakes to ensure that its activities incorporate the ten principles set out in the Global Compact relating to conduct and action in this regard, such as nondiscrimination in employment, the elimination of forced or compulsory labour, and the abolition of child labour.
• The Equator Principles, which the Bank signed up to in 2011 and which form a framework for the assessment and management of social and environmental risks, encompassing respect for human rights, and the performance of due diligence to prevent, mitigate and manage adverse impacts.
• The Principles for Responsible Banking, among which the principles of commercial alignment, the principle of impacts and those related to customers and users, as well as the principle of transparency and accountability, are particularly relevant to human rights.

From the perspective of corporate governance, the Group has a Human Rights Policy and a related Due Diligence Procedure, both approved in 2021, which are reviewed annually and are applicable to all Group companies. They establish basic principles of action, as well as the mechanisms required to identify, prevent, mitigate and/or remedy any potential negative impacts on human rights that the Bank's activities and processes may entail, in particular with regard to granting finance to companies, or in relation to its human resources management model or supplier engagement processes. They also establish the need for employees to receive training in all of these areas.

The Group also has a new version of the Group Code of Conduct, first approved in 2021 by the Board of Directors, which underwent an in-depth review to adapt it to regulatory requirements, supervisory guidelines and specifications, and to market standards. In short, to ensure it complies with the expectations and objectives of its various stakeholder groups. Every member of the Group's workforce was required to read and expressly accept the updated version of the Group's Code of Conduct.

As a direct result of updating the Group's Code of Conduct, the Supplier Code of Conduct was also reviewed, incorporating aspects related to the Group's model for the organisation and management of crime risk, the Corporate Ethics Committee as the most senior supervisory body, and control of the whistleblowing channel.

The Group is committed to implementing measures, within its scope of action, to ensure that its activities do not produce any subordination, helplessness or vulnerability among its customers or in the communities in which it operates, which might prevent them from exercising their rights of equality, on account of personal, economic, educational or social circumstances in which customers may find themselves, even if these circumstances are temporary or if they relate to a specific territory or sector.

The Group fosters inclusion among its customers, offering products and services that contribute to a positive social impact through responsible business, as is the case with its social housing management and financial inclusion activities, through digitalisation and financial education programmes. To that end, the Group promotes transparency of information and responsible communication with regard to its financial products and/or services, adapting them to the needs and circumstances of its customers and facilitating customers' understanding of the related terms and conditions, risks and costs, thus promoting clear, balanced and transparent communication around those products and services.

In addition, as part of the effort to prevent digital fraud, mainly affecting people aged 65 and above, the Bank has within its structure a specialist Transaction Fraud unit, which manages to prevent 87% of attempted digital fraud incidents, via an alerts system in cash transfer transactions (transfers, payment services and Bizum).

The Group is also committed to the fight against corruption, money laundering and terrorist financing, and it undertakes to promote conduct that respects the regulations and ethical standards, ensuring the same respect in relation to its customers, suppliers or other commercial partners and in relation to the environment or communities in which Banco Sabadell Group operates.

On the other hand, the Group supports the communities in which it is present, through direct donations or by helping employees to engage in corporate volunteering, which benefits many initiatives aimed at those most in need. Similarly, it encourages practices that contribute to addressing issues related to housing and social exclusion in the most disadvantaged social groups, delivering real estate assets for them to live in to non-profit institutions and foundations that offer support to the most vulnerable or at-risk social groups.

At a global level, the Group contributes to the attainment of the United Nations' Sustainable Development Goals (SDGs) linked to fundamental human rights, through the development of programmes and initiatives, such as quality education (SDG 4), no poverty (SDG 1), good health and well-being (SDG 3), decent work and economic growth (SDG 8), gender equality (SDG 5) and reduced inequalities (SDG 10).

In addition, the Bank has an Information Systems Security Policy and a Personal Data Protection and Privacy Policy, as described in section 5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model.

5.3.3.2 S4-2: Processes for engaging with consumers and end-users about impacts

Knowing customers at every stage of their relationship with Banco Sabadell is crucial. That is why new methodologies are continuously being developed that allow the Bank to listen to what customers are saying, to measure and determine the main reasons for customer satisfaction and dissatisfaction and how near or far it is from meeting customers' expectations. This measurement involves understanding the market, consumers and customers, using a number of different qualitative and quantitative analytical methodologies to that end.

More specifically, Banco Sabadell analyses its customers' experience through ongoing quantitative surveys, such as:

1. Net Promoter Score (NPS), conducted three times a year. This survey asks customers how likely they are to recommend their main bank and the reasons for their response.

2. Satisfaction surveys, conducted monthly. These cover the main points of contact with the Bank and therefore include products (application processes, among others) and channels (branches, relationship managers, digital banking, among others).

3. Commercial quality studies, conducted monthly.

4. Studies of the financial behaviour of Retail Banking customers, Business Banking customers, smaller businesses and self-employed professionals, conducted on an annual basis for Retail Banking customers and every other year for Business Banking customers.

In addition, in order to better understand the environment and the customers within it, the Bank also carries out a qualitative analysis. Specifically, the Bank undertakes various qualitative studies and research projects using different methodologies. The aims pursued include:

• Listening carefully, actively and constantly to what customers have to say, so as to ascertain how they experience their relationship with the Bank at different touchpoints.
• Understanding the expectations, concerns, worries and attitudes of consumers and their current and future needs.
• Identifying the more emotional and least explicit part of consumer decision-making.

• Defining ad hoc value propositions for each type of customer. A variety of techniques are used, ranging from in-depth interviews and segment-specific focus groups to more innovative methodologies based on behavioural economics and the detection of the deepest emotions and motivations of consumers.

Ultimately, the goal is to design courses of action that will improve the experience of all types and segments of customers and consumers and to bring the value proposition in line with the needs and expectations of consumers in general and of Sabadell's customers in particular. The designed actions are scheduled and their implementation is monitored by the specific customer experience committees of the Business Banking and Retail Banking business divisions, which also receive the results of customer opinion surveys.

5.3.3.3. S4-3: Processes to remediate negative impacts and channels for consumers and end-users to raise concerns

To contribute to the remediation of material negative impacts on consumers and end-users, and specifically in relation to the topics of Access to products and services and Non-discrimination, the Bank follows the Code of Good Practice (Código de Buenas Prácticas, or CBP).

Customers are made aware that the Bank follows the CBP, either by their branch manager or through the landing page of the Bank's website, which explains what this debt restructuring plan consists of and the necessary requirements to request its application. In addition, all of the communications sent to customers who hold a mortgage on their usual residence and who are experiencing payment difficulties contain information to make them aware of the service's existence.

Interaction with customers always takes place through an external agency, regardless of the way in which the customer has expressed interest in benefiting from the CBP. Within 24 hours following the customer's call or application, they are contacted in order to request the relevant documents needed to analyse the operation.

The actions taken by the agency are governed by an action protocol put together by the CBP department in accordance with the procedure and timeframes established in regulations.

The process for dealing with applications for the CBP has control mechanisms to ensure that it takes place in accordance with the corresponding action protocols and regulations. Specifically, the various departments taking part in the application process undergo regular checks and controls.

Those controls include verifying that the process is completed and communicated within the timeframes laid down by regulations and that each case is analysed correctly (calculation of affordability, economic data about the family unit, etc.) and that the letters sent to inform customers of the outcome of the analysis are in line with that established.

They also include verifying that the formalisation phase has been conducted correctly, from the moment the application process for a notary's signature begins until the signature is added to the system. This monitoring exercise takes place on a weekly basis and a comprehensive verification exercise is carried out of the various departments involved, to ensure that the application of the measures is not delayed after the customer has been informed that they are eligible to benefit from the debt restructuring plan provided by the CBP.

Banco Sabadell's processes ensure that customers are offered the possibility of applying to benefit from the CBP and that their applications are processed in line with prevailing regulations. Customers are also offered help to put together the necessary documents, if necessary. An individual case study is always carried out for each application received, being particularly mindful of the specific circumstances of each case.

In addition, through Sogeviso, the Bank helps vulnerable customers through the Social Support programme and the JoBS⁶¹ programme.

In this respect, as part of that provided in the General Data Protection Regulation, the documents signed by tenants and members of the family unit upon opting in to the Social Support programme and JoBS, respectively, specify the channels through which they may exercise their rights in relation to their personal data and indicate where they should send any queries or concerns that they may have in relation therewith.

⁶¹ More details about these programmes can be found in section 5.3.2.2. ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model

In addition to the telephony and email channels, the vulnerable families helped by Sogeviso may contact the company through service providers engaged by Sogeviso to manage social contracts and JoBS. They can also contact the company by telephone or email, as well as in person by requesting onsite visits to the properties that they occupy.

The channels are subject to the General Data Protection Regulation.

In the same way, there are alerts that are triggered if any personal data is sent via email. If an alert of this kind is triggered, Sogeviso's Corporate Services division contacts the person/unit that triggered the alert in order to ascertain the reason behind the event and to find solutions for the secure sending of data where necessary. Information is sent to Operational Risk on a monthly basis regarding the monitoring of incidents related to any outgoing personal data.

All suppliers and service providers act legitimately through contracts with Sogeviso, with clauses on personal data processing worded by Banco Sabadell's Contracts division.

Every year, personal data processing activities and the associated DPIAs are reviewed.

The relevant unit monitors suppliers and service providers to ensure they receive consent to personal data processing by the various business lines.

In the case of the data processing itself, it ensures that customers are aware of the channels they can use to exercise their rights, as these are set out in writing in the documents that they sign. On the other hand, in relation to the telephony channel, all outgoing calls to customers with a social or affordable rent agreement are recorded for quality purposes, and they are assessed on a quarterly basis, based on a random sample, keeping a record of the assessment results based on various parameters.

Sogeviso's management processes ensure not only compliance with regulations concerning vulnerable customers, both State-wide and specific to autonomous communities, but also fulfilment of the Institution's social responsibilities. Thus, all processes envisage the collection of information and documentation to verify the social and economic situation of the family unit, as well as individual decision-making, for each situation.

In addition, tenants or mortgage debtors whose properties have been repossessed by the Bank may contact Sogeviso to manage and search for solutions to their situation (such as, for example, the inability to keep up with rent payments due to a reduced level of income).

Lastly, in accordance with Order ECO 734/2004 of 11 March, Banco Sabadell has a Customer Care Service (Servicio de Atención al Cliente, or SAC) which handles complaints and claims. Customers and users may also appeal to the Customer Ombudsman, an independent body of the Institution that has the authority to resolve any issues referred to it, in both the first and second instances. Decisions by the Customer Care Service or the Ombudsman are binding on all the Bank's units.

In accordance with its Regulations, the SAC handles and resolves complaints and claims from customers and users of Banco de Sabadell, S.A. and other associated entities: Sabadell Asset Management, S.A., S.G.I.I.C. Sociedad Unipersonal, Urquijo Gestión, S.G.I.I.C, S.A. and Sabadell Consumer Finance, S.A.U.

The SAC and its head, who is appointed by the Board of Directors, to which reports are sent on at least a semiannual basis, report directly to the Compliance division and are independent of the Bank's business and operational lines. Its main function is to handle and resolve complaints and claims put forward by customers and users of the financial services of the Bank and its associated entities, under the principles of transparency, impartiality, effectiveness, coordination, speed and security.

In addition, the SAC can issue recommendations or suggestions derived from the analysis of complaints and claims received by the SAC.

The operation of the SAC is governed by its Terms of Reference and by the policy document, both of which are approved by the Board of Directors. An information poster is available in all branches indicating the existence and address, both postal and electronic, of the SAC and the Ombudsman, in addition to access to the Terms of Reference, which ensures compliance therewith.

Customers and users of financial services can submit complaints through various channels: either in person at branches, filling out the printed form created for that purpose, by filling in an electronic form or sending an email, or by sending a letter to the SAC or to the Customer Ombudsman.

Once a complaint or claim has been submitted, it will be dealt with by the SAC according to its Regulation. The claimant will receive information regarding the resolution of their complaint from the SAC within the legally established timeframe.

Where they object to the resolution, or if no response is received within the legally established framework, the claimant may contact the complaints services of the Bank of Spain or of the National Securities Market Commission (CNMV), as appropriate.

Furthermore, if they have submitted their complaint to the SAC, they may also refer the case to the Customer Ombudsman.

During 2024, the following complaints and claims were received and managed in accordance with Bank of Spain Circular 4/2021 of 25 November:

Complaints and claims received	Volume
Customer Care Service	99,558
Customer Ombudsman	4,289
Bank of Spain	750
Spanish National Securities Market Commission (CNMV)	24
Total complaints and claims received	104,621
Complaints handled	Volume	Percentage
Resolved in favour of the Institution	22,108	39.9%
Resolved in favour of the claimant	33,321	60.1%

The increase in the number of complaints is due to a 360% increase in the number of complaints received in connection with valuation charges/other arrangement fees.

Inadmissible as a result of the application of Regulations 49,740

In the case of the subsidiary TSB, in 2024 the number of recorded complaints was 58,595. The volume recorded during the same period in 2023 was 62,696 and, therefore, 2024 represents an 6.5% reduction (4,077) on that figure. This reduction is mainly explained by improvements made to the customer journey and to the system's greater stability. Of the total number of complaints, claims and other communications recorded in 2024, a total of 56,284 (96.2%) were resolved before the end of the year, i.e. 31 December 2024.

Customer complaints can be sent to TSB through various channels, for example, by phone, by visiting branches, by completing an online form or on the mobile app. Complaints are logged and resolved by the agent who first receives them, where possible. Where that is not possible, they are relayed to the Customer Relations team. This team assigns a person to deal with the cases in question, who resolves complaints about payment services within a period of 15 days and all other complaints within 8 weeks, where possible, as per the guidelines of the Financial Conduct Authority. The complaint is either upheld or not upheld. If the customer is unhappy with the proposed resolution, they may contact the Financial Ombudsman for an independent review.

TSB is the first UK retail bank accredited by the Good Business Charter, a national accreditation scheme that recognises businesses that behave responsibly and measures behaviour over 10 components: real living wage, fairer hours and contracts, employee well-being, employee representation, diversity and inclusion, environmental responsibility, paying fair tax, commitment to customers, ethical sourcing and prompt payment.

With regard to Mexico, in accordance with applicable Mexican regulations, the Law on the Protection and Defence of Users of Financial Services (Ley de Protección y Defensa al Usuario de Servicios Financieros) and the Provision on Record-Keeping for disclosure to CONDUSEF (Disposición en Materia de Registros ante la CONDUSEF), CONDUSEF being the National Commission for the Protection and Defence of Users of Financial Services (Comisión Nacional para la Protección y Defensa de los Usuarios de Servicios Financieros), Banco Sabadell Mexico has its own customer service available to its customers and to users of its financial services through the Customer Care Centre (Centro de Atención al Cliente, or CAC) and the Specialised User Assistance Unit (Unidad Especializada de Atención a Usuarios, or UNE). The UNE, which reports directly to the Compliance division and is separate from the Bank's operational and business lines, and the CAC, which as the first point of contact supports the UNE, offer assistance to customers and users of financial services to resolve their queries, clarifications⁶² and complaints. Customers and end users may contact the Institution by telephone, by email, in person, or through the customer service offices and also through the website. There is also a section on the website called "asistencia" (meaning 'help'), which lists useful contacts and the process that users should follow so that they may benefit from a fast and appropriate response. As at the end of December 2024, a total of 0 complaints and 11 claims had been received.

5.3.3.4 S4-4: Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions

Banco Sabadell Group, through the initiatives mentioned and detailed above in relation to vulnerable customers and also through Sogeviso, the Code of Good Practice, BStartup, Cybersecurity and Data Protection, plays a fundamental role in terms of access to products and services and non-discrimination⁶³ .

Various measures have been taken to help those affected by the DANA flash floods, which are described in section 5.3.2.2 ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model.

In addition, to mitigate the risk of over-indebtedness, it is important to note that for new requests from retail customers, Banco Sabadell has a Credit Risk Granting Procedure and tools for automated analysis. These are designed to evaluate the ability of customers to fulfil their payment obligations and, to protect customers and prevent their over-indebtedness, any possible situations that could arise from an increase in their expenditure are taken into consideration.

In relation to human rights, none of the complaints or claims received in 2024 through the SAC affected the vulnerability in this regard of consumers or end-users.

The Group has allocated the necessary resources (staff and economic) to ensure that all material incidents are managed.

On the other hand, to contribute positively to the improvement of social outcomes for consumers and end-users, Banco Sabadell Group articulates its commitment to society mainly through the Banco Sabadell Private Foundation (hereinafter, Banco Sabadell Foundation) with a view to driving forward the progress and social welfare of individuals, by promoting culture and the arts and research and education, in particular by fostering young talent.

In 2024, the Banco Sabadell Private Foundation received an endowment of 5 million euros from Banco Sabadell, intended for implementation of the annual Action Plan, of which 3,798,034 euros had been allocated as at the end of the year for collaborations with other institutions.

To monitor the institutions and projects with which it collaborates, a supporting document is requested at the start and end of the collaboration, in order to verify that the funds have been correctly allocated and that the activity has taken place as agreed. Both at the start and at the end of the activity, the projects are evaluated based on indicators that make it possible to measure the suitability of the project, analysing results in the medium and long term, to decide whether to continue to support it. In addition, an evaluation matrix has been developed that very few third-sector entities have, which makes it possible to be completely objective and transparent when distributing resources, allocating them efficiently according to the needs of each entity and project.

⁶² Taking into account the definition of "clarifications" in Mexico (as provided in Article 23 of the Law on Transparency and Regulation of Financial Services (Ley para la Transparencia y Ordenamiento de los Servicios Financieros, which defines 'clarifications' as requests submitted by users using any of the available means of submission in order to obtain an explanation about the operations or services on offer or which they have acquired), clarifications are thought to be equivalent to what we call "complaints"

⁶³ For more details, see section 5.3.2.2 ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model

The Banco Sabadell Private Foundation categorises its activity into two main action areas: "Research and education", and "Culture and the arts".

Research and education

By supporting research and education, the Banco Sabadell Foundation invests in society's future and in its ability to find solutions to the most complex and urgent challenges, contributes to boosting the economic, social and cultural growth of the nation, by increasing productivity and innovation, creates learning opportunities and fosters people's talent to facilitate their access to the job market.

Culture and the arts

By promoting culture and the arts, the Banco Sabadell Foundation fosters creativity and innovation, provides opportunities and resources to young artists to help them develop their skills and advocates for a more equitable and diverse society. In addition, it contributes to the cultural enrichment of society and drives transformation.

Promotion of alliances

The Banco Sabadell Foundation promotes the creation of alliances between institutions that seek to raise the profile of culture, the arts, research and education in order to build avenues for collaboration and a more critical, fair and inclusive society. It supports the institutions with which it collaborates by providing its knowledge and networks and by boosting synergies between institutions and projects to facilitate collaboration.

In this respect, the Foundation held the SumArte conferences, under the theme of Museums and Artificial Intelligence, bringing together representatives from 21 of the top museums in the country who shared a space for reflection and discussion with six volunteers from Banco Sabadell's Operations, Analytical Technology & Artificial Intelligence team in order to promote collaboration and the co-creation of projects in the sector.

The Banco Sabadell Foundation has put together a Steering Group formed of directors of leading entities of our country's cultural sector to establish, through social innovation methodologies, a rallying point with regular meetings held throughout the year to reflect on the challenges and opportunities of the cultural industry. This work is complemented with the opinions collected at previous meetings from other contrast groups formed of entities with which the Banco Sabadell Foundation collaborates across the country, as well as young leading creators.

Commitment to young talent

The Banco Sabadell Foundation demonstrates its commitment to young talent by supporting leading universities, research centres and educational institutions, as well as by contributing to research excellence through awards, residencies and support programmes. The most noteworthy activities in this area are:

• The Banco Sabadell Foundation's own awards, such as the 19th edition of the Biomedical Research Award, the 23rd edition of the Economic Research Award, the 8th edition of the Science and Engineering Award, the 3rd edition of the Marine Sustainability Award, and the research grants aimed at aspiring pre-PhD students of social sciences and humanities.
• Awards to recognise young talent, such as the ANFACO & Banco Sabadell Foundation Design Award and the ADI FAC Medals of the Associació de Disseny Industrial association, the Joan Guinjoan International Award for Young Composers of ESMUC, the Maria Canals International Music Competition for piano performers, the International Award for Young Cellists of the Fundació Pau Casals foundation, and the Mirna Lacambra Competition for the professionalisation of young opera singers.
• Collaborations with leading universities and academic centres with awards and grants to promote young talent and employability at the universities of Leon (Ralbar grants), Alicante (internship programme), Oviedo (Hackathon TalentUO), Vigo (Foro Mentor), San Jorge (research grants), Jaume I (Research Hackathon UJI), Las Palmas (university diploma in digital skills), the grants offered by the Escuela de Empresarios de la Comunidad Valenciana (EDEM), ESADE and the Barcelona Education in Science and

Technology (BEST) Foundation, and the doctorate programme in artificial intelligence of the ELLIS Alicante Unit.

• Programmes of grants, courses and residencies in art centres, such as the grants offered by the Fundación Comunitat Valenciana foundation, Auditorium of the Provincial Council of Alicante (ADDA) the Reina Sofia School of Music, the Private Foundation of the Associació d'artistes visuals de Catalunya (HANGAR), the course offered by the Prado Museum, the residencies of the Consorci Mercat de les Flors and Teatre Lliure, and the European programme EEEmerging, hosted by Joventuts Musicals de Torroella, Centro Azkuna de Sociedad y Cultura Contemporánea and the Antonio Gala Foundation.
• Training programmes for emerging artists with the Teatro Real theatre (Crescendo and Ciclo Jóvenes Talentos), the Miró Foundation (Espai 13), La Casa Encendida (Generaciones), the Cidade da Cultura de Galicia Foundation (Encontro Artistas Novos), the Franz Schubert Association (Lied the future), the Bachcelona Foundation (Bachcelona Academise), the Live Music Association (Gardai Orchestra), the Consorci de l'Auditori i l'Orquestra consortium (Festival Emergents and Sampler Series cycle), the Gran Teatre del Liceu (Oh!pera programme) and the Ópera Catalunya Foundation (Escuela de ópera and Jove Orquestra Simfònica del Vallès).
• Young talent training programme offered by the Celera Association, the awards and grants of the Talent Global programme for CIDOB, the seminars organised by the ASPEN Foundation and the La Movida educational innovation programme organised by KUBBO.

Culture as a tool for social transformation

The Banco Sabadell Foundation's mission is to bring culture closer to society by co-promoting, together with flagship cultural centres, transformative proposals that contribute to the training, development, preparation and employability of young people through various artistic disciplines:

• Educational and professional guidance projects aimed at young people in socially vulnerable situations, organised by the Exit Foundation, the Empieza por Educar Foundation (Sabadell EduTalento), as well as teacher training with the La Ciutat Invisible Foundation (Seminario Docentes seminars) and the Princesa de Girona Foundation (Generación Docentes programme).
• Projects for cultural transformation through art, organised by Madrid Destino (Dentro Cine), La Selva Ecosistema Creatiu (Horagai), the La Ciutat Invisible Foundation (A Tempo), Teatro Joven, and L'Arc Taller de Música (Zona Jove Xamfrà)
• Social inclusion projects organised by the SHIP2B Foundation (B-Value), the SIFU Group Foundation (SuperArte grants), the Reina Sofia School of Music (Entrepreneurship programme) and the Dádoris Foundation (grants for outstanding young people at risk of social exclusion), as well as support for the Dones Mentores project.

Medical research and health

In addition to the Banco Sabadell Foundation's four awards for Biomedical Research, Economic Research, Science and Engineering, and Marine Sustainability, the Foundation also supports scientific research through programmes organised by leading entities in the sector, forming part of the Board of Trustees of the Barcelona Institute of Science and Technology (BIST), supporting the Programa de Intensificación de Investigadores intensive research programme organised by Consorci Parc Taulí, the programme of alumni research grants of the San Jorge University, the pre-PhD grant offered by the Fundación para la Investigación e Innovación Biosanitaria del Principado de Asturias (FINBA) foundation, and the annual activities of the Pasqual Maragall Foundation and the Degén Institute of the Fundación Española de Ayuda a la Investigación en Parkinson (Spanish foundation for research into Parkinson's disease).

Financial education

Banco Sabadell continues to promote and take part in a number of financial education initiatives. By engaging in this type of activity, the Institution aims not only to meet the training requirements of society in general, but also to be by their side to help them develop skills and decision-making abilities. Some of the initiatives undertaken include:

• The Educación Financiera en las Escuelas de Cataluña (EFEC) programme for financial education in schools: Banco Sabadell continues to participate in this programme, having done so for the eleventh consecutive year and ever since its inception. Thanks to the corporate volunteers of the participating institutions, a total of 213,893 students have been trained in basic finance. In this edition, which continued to be run in hybrid form combining face-to-face and virtual workshops, the programme has been taught in 501 educational centres. With the participation of 102 volunteers who ran a total of 870 workshops, Banco Sabadell, together with all of the collaborating institutions, provided training for 25,809 young people aged 15-16. In terms of its version for adults, 21 of the Bank's volunteers held 114 workshops in adult schools and correctional facilities. The estimated figures for the EFEC Adults programme were 128 centres and 6,558 students.
• 'Your finances, Your future' (Tus Finanzas, Tu futuro) initiative promoted by the Spanish Banking Association (Asociación Española de Banca, or AEB) and the Junior Achievement (JA) Foundation. In this year's online edition, 107 volunteers from the Bank took part in 60 programmes delivered to 45 educational centres and 1,399 students. In 2024, the programme, which is nationwide in scope, was delivered to 195 centres and 9,230 students.
• 'What do we know about economics' (Qué sabemos de economía) programme, organised by the Asturias School of Economists (Colegio de Economistas de Asturias) and Oviedo Town Hall to teach basic concepts about economics and financial education to students aged 11-12. 12 volunteers from Banco Sabadell took part, holding a total of 26 workshops that benefitted 528 students.

During 2024, a total of 9,984 people took part in the workshops that Banco Sabadell volunteers led as part of these programmes.

Business support and training

• 'Export to Grow' (Exportar para crecer) programme: as part of its commitment to provide training in internationalisation to small and medium-sized enterprises, Banco Sabadell, in collaboration with AENOR, AMEC, Arola, CESCE, Cofides, Esade and Garrigues, has been promoting the 'Export to Grow' programme since 2012. This programme supports SMEs in their internationalisation process, through online tools, specialised information services and the organisation of roundtables throughout the country. Under this programme, a series of International Business Conferences (Jornadas de Negocio Internacional) were held in online and hybrid (in-person + online) format, most notably the session on Letters of credit: an exporter's guide, with the participation of 900 companies, and the session on International taxation aspects for Spanish companies, with 460 participating companies. In addition, a selection of news content concerning international business is offered through a newsletter that is sent to the Bank's business customers every month, with information about international markets and business sectors most likely to engage in internationalisation or exports.
• Sabadell International Business Programme: the Institution held the sixth edition of this universitycertified training programme that offers advice to business customers, which has already attracted the participation of more than 400 companies engaging in international business.

• The new editions of the Financial Advisor for Religious and Third Sector Institutions training course came to end; they were promoted in collaboration with the post-graduate school of the University of Francisco de Vitoria and are intended to offer a solid foundation for the day-to-day management of directors and bursars. One of these new editions consisted of a renewed and expanded course, updated with new content to make it more cross-disciplinary, offering complete and rigorous training to professionals and collaborators in the sector with the aim of reinforcing the specialised knowledge of these institutions and helping to provide their directors with knowledge and tools. The second of the new editions was a brief and fully online course (12 ECTS and 24 MiFID accreditation hours) that offers tutorials delivered by Banco Sabadell specialists. For the first time, both of these two latest editions were open to professionals from all sectors and had a wide range of scholarships available covering up to 80% of the enrolment fee. At the end of the programme, the students received their certificates from the University of Francisco de Vitoria. These two new editions culminated with a total of 244 enrolled students (75 of whom were Banco Sabadell employees) and a total of 188 students received their certificates of completion.

Bridging the digital divide

In 2024, Banco Sabadell promoted the following programmes and initiatives, upholding its commitment to education and digitalisation:

• The 'Technological independence and digitalisation' programme, to bridge the digital divide among older people, in collaboration with the Vivo Fácil Foundation, an organisation specialised in improving the quality of life of older people and other vulnerable groups. The aim of its training activities is to provide those taking part with information about and access to the possibilities that ICT has to offer, improving not only their independence and quality of life but also their sense of belonging and companionship.

In 2024, 58 four-hour workshops were organised, with an average of 12 people in attendance. The workshops were taught by a specialised technician from the Vivo Fácil Foundation and a volunteer from Banco Sabadell. 79 volunteers took part and this programme reached a total of 2,448 individuals.

The Banco Sabadell Foundation carried out the following programmes:

• The 'Connect the Young Connect the Elderly' (Conecta Joven Conecta Mayores) programme in collaboration with Fundación Balia por la Infancia, an intergenerational project in which young people aged 14-18 complete, on a voluntary basis, a learning process to teach basic computer skills and the use of digital devices to people over age 60, with mild cognitive impairment and/or with intellectual disabilities who, for various reasons, have difficulty in accessing new technologies.
• The university expert course on digital skills of the Fundación Universitaria Las Palmas (FULP) foundation, which seeks to prepare recent graduates of further education for a digitalised and everchanging job market.

Corporate Volunteering Programme

This year, once again, the people who form part of Banco Sabadell demonstrated their commitment to society, going above and beyond their professional duties, giving their time and sharing their talents to help people and organisations in need of them. More than 2,800 volunteers took part in social initiatives promoted by the Bank, its Foundation and other collaborating organisations, through the Bank's Corporate Volunteering Programme.

In addition to the educational programmes indicated above, the cooperation initiatives and charitable programmes carried out by the Bank include, most notably:

• Support for third-sector institutions that participate in the B-Value social innovation programme, the aim of which is to professionalise the value proposition and work on the sustainability of projects of nonprofit social institutions throughout Spain. Since the first edition of B-Value in 2017, the Banco Sabadell Foundation and other organisations that promote the programme have presented different awards to finalists from among the 40 participating entities. These awards help them to take their projects forward and give visibility to the causes that they support, putting the spotlight on talent and innovation. One of the keys to the programme's success is the participation of the Bank's employees as voluntary mentors. This year, 40 employees from different areas of the Bank and in pre-managerial roles and 13 employees from Sabadell Zurich supported those organisations in developing their social impact projects.

• With regard to programmes that leverage the knowledge and experience of the Bank's employees and that concern vulnerable sectors of society and/or those at risk of social exclusion, two initiatives worthy of mention are the Leader Coach Project and the Career Guidance Programme aimed at socially vulnerable young people run by Fundación Éxit, in which the Banco Sabadell Foundation is involved. It is a corporate volunteering initiative that seeks to improve the future employability of young people who have had an unsuccessful academic experience. This year, 27 volunteers from the Bank took part and dedicated 678 hours of their time to young people, to keep them in training.
• In line with the goal of promoting and supporting young talent, the mentoring and talent management programme provided by the University of Alicante and Banco Sabadell's Technological Skills Centre of Alicante (Centro de Competencias Tecnológicas de Alicante, or CCTA) is worthy of mention. In 2024, the fourth edition of the programme was held, in which 24 professionals from the CCTA guided 15 students from the University of Alicante during the resolution of a challenge, so that they could develop key skills for their professional future.
• Women also benefit from the following programmes: 'Ace your job interview' (Triunfa en tu entrevista de trabajo), 'Job search 2.0' (Búsqueda de empleo 2.0), 'Ready and able' (Capaces) and 'Emotional intelligence for the workplace' (Inteligencia emocional para el empleo), in which the Bank has been collaborating with Fundación Quiero Trabajo since 2019. The aim is to empower people, particularly women at risk of social exclusion, by enhancing their skills and attitudes, and by giving them the tools to navigate the selection process and job interviews with a successful outcome. This year, a total of 94 volunteers from the Bank mentored the participants of these programmes. In 2024, in collaboration with Fundación Quiero Trabajo, the Bank accompanied other vulnerable groups such as young people who are inmates at the Quatre Camins prison, members of the LGBTIQ+ community and people with intellectual disabilities.
• Each year, to coincide with the Christmas festivities and in collaboration with the Fundación Magone Salesianos Acción Social, through its corporate volunteering programme, the Bank runs the 'Be one of the Wise Men' (Conviértete en Rey Mago) programme, in which volunteers sponsor and deliver gifts in response to letters written by children under the care of the foundation. On the eve of Epiphany, the volunteers distribute the gifts. In 2024, 649 volunteers from Banco Sabadell took part in this project. In addition, in collaboration with Cáritas Molina de Segura, 70 volunteers distributed the same number of gifts to local children.

5.3.4 Metrics and targets

5.3.4.1 S4-5: Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

The Institution has set various targets aimed at reducing negative impacts, advancing positive impacts and managing the risks and opportunities of end consumers.

In 2022, the Bank had already reinforced its ESG dimensions applied to the strategy, governance and its business model, with the launch of Sabadell's Commitment to Sustainability (published on the Group's website), which includes specific targets for 2025-2050 across four strategic pillars. The action framework set out in Sabadell's Commitment to Sustainability document ensures the integration into its strategy of a forward-looking vision in relation to environmental, social and governance commitments, aligns its business objectives with the Sustainable Development Goals, and establishes action levers to generate transformation and promotion activities.

In this respect, the Bank has set the following targets for 2025 to support customers in the transition to a sustainable economy:

• €65bn in financial products and services mobilised in cumulative terms between 2021 and 2025 in sustainable finance solutions (including green and social loans, sustainability-linked loans, capital markets and social financing). In 2021, the reference value was €11bn. Up to December 2024, more than €57.9bn had been mobilised, €19bn of them during this year.

• >€15bn of financing granted to micro-enterprises in cumulative terms between 2021 and 2025. In 2021, the reference value was €2.9bn. In 2024, over €2.8bn of financing was granted, bringing the cumulative amount over 2021-2024 to over €11.5bn, which represents 77% of the target set for the 2021-2025 period.

In addition, as part of the action framework of Sabadell's Commitment to Sustainability, it is worth highlighting the following targets to be met by 2025:

• Increase direct investments in innovative and high-impact startups (BStartup Green and BStartup Health programmes) through the BStartup10 vehicle. In 2024, the fourth call for proposals under BStartupGreen and the seventh edition of BStartup Health were launched, and investments continued to be made in startups.
• 10,000 annual recipients of financial education programmes including new sectors of the population (seniors, vulnerable groups, etc.). In 2021, the reference value was 6,300 annual recipients, with the total number of recipients in 2024 being 9,984.
• 2,000 participants in social impact projects. In 2021, the reference value was 1,300 participants, while in 2024, participants numbered a total of 2,800.
• Continue to foster culture and talent by promoting education and research activities through the Banco Sabadell Foundation. In 2024, the Banco Sabadell Foundation continued to conduct initiatives to promote culture and the arts, and research and education, focusing particularly on promoting young talent.

Banco Sabadell contributes to the transition towards a more sustainable and cohesive society through ethical and responsible management. The Bank is also committed to data privacy and cybersecurity and it has set the following targets to be met in 2025:

• Keep security controls aligned with best practices (ISO 27001 standard, NIST Cybersecurity Framework) and have them reviewed by an independent third party. In this regard, in 2024, the Bank continued to control the cybersecurity risks to which it is exposed.
• Keep security training of employees and partners up to date. In 2024, annual training courses in relation to data protection and cybersecurity continued to be held, which are mandatory for all employees, as well as specific training programmes for the cybersecurity teams.

The targets included in Sabadell's Commitment to Sustainability were set in 2022, using 2021 as the base year.

The setting of those targets involved all of the Institution's teams, designing four pillars or action areas which are at the core of Sustainability in Banco Sabadell, setting various targets to be met in the short, medium and long term by developing the strategic pillars, with firm commitments and a well-defined roadmap.

Once those targets had been established by the various areas, a formal validation of content was required, requesting approval of the commitments by the various areas involved at two levels.

The Board Strategy and Sustainability Committee approved the content of Sabadell's Commitment to Sustainability, as delegated by the Board of Directors.

The Board Strategy and Sustainability Committee, through the Corporate Sustainability Report, a document that contains information about the overall ESG environment in the context of the macroeconomic and regulatory environment, about the Institution's ESG outlook, and about the integration of ESG risks into management arrangements, monitors the priority indicators of Sabadell's Commitment to Sustainability on an ongoing basis.

5.4 Governance: Business conduct

5.4.1 Introduction

Compliance, which forms part of the Group's corporate culture and enhances the required levels of honesty and professional liability, refers to the act of becoming acquainted with, observing, preventing and acting in accordance with the laws, regulations, internal rules and applicable codes of ethics in order to mitigate the risk of incurring sanctions, fines, financial losses and/or loss of reputation.

5.4.2 Governance

5.4.2.1 ESRS 2 GOV-1: The role of the administrative, management and supervisory bodies

The Corporate Ethics Committee (CEC) reports directly to the Board of Directors and is ultimately responsible for adopting policies on corporate reputation and ethical behaviour. The CEC's core mission is to promote the ethical behaviour of the organisation to ensure compliance with the action principles set out in the Banco Sabadell Group Code of Conduct, the Internal Code of Conduct relating to the securities market, the Corporate Crime Prevention Policy, the General Policy on Conflicts of Interest, the Anti-Corruption Policy and the Policy on the Internal Reporting System and Protection of Reporting Persons⁶⁴ .

On the other hand, the matrix of competences and diversity of members of the Board of Directors⁶⁵ shows the horizontal and sectoral skills found in the Board of Directors. In this respect, all Board members, as a horizontal skill, have business experience, experience as members of governing bodies, and experience in managing and directing organisations; thirteen of them have specific skills in relation to governance, and twelve in the area of human resources, culture, talent and remuneration. Eight members of the Board of Directors have specific skills in the sectoral area of responsible business and sustainability.

5.4.3 Impacts, risks and opportunities management

5.4.3.1 ESRS 2 IRO-1: Description of the processes to identify and assess material impacts, risks and opportunities

Material impacts, risks and opportunities in relation to business conduct matters have been determined and evaluated in the new Double Materiality exercise and the relevant details are given in section 3.3 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model.

5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture

One of the fundamental elements for consolidating a robust corporate culture is the existence of a set of regulations that reflects the firm commitment of all units to comply with legislation, starting with the Management Body.

In this regard, the policies in place at the Bank for managing business conduct matters are indicated here below. In addition, both the Code of Conduct and the policies are published on the Bank's corporate website and on the corporate intranet available to all employees.

Banco Sabadell Group Code of Conduct

The Board of Directors approved Banco Sabadell Group's Code of Conduct in order to set out the catalogue of principles, obligations and duties that should govern the actions of all those within the Group. The Code of Conduct is reviewed regularly and updated as required.

All internal obligations with ethical content are included in the Group's Code of Conduct, which thus groups them all together in a single regulatory compendium under the direct supervision and approval of the Corporate Ethics Committee and the Board of Directors.

⁶⁴ Details about these policies can be found in section 5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture

⁶⁵ Details about the matrix of competences and diversity of members of the Board of Directors are given in section 2.1 GOV-1: The role of the administrative, management and supervisory bodies

The aim of the Code is to define the criteria that should be followed for ethical and responsible behaviour, both in relationships within the Group itself and in those entered into with customers, suppliers, shareholders, investors and other stakeholders.

Those subject to the Code are people who form part of governing bodies, people with employment links, external suppliers and business partners. It is applicable in all jurisdictions and territories in which the Group carries out its activities, so they are required to formally adopt it.

The principles that underpin the corporate culture and serve as a framework of reference for the Code are the will to serve, proximity, adaptability, commercial approach, innovation, professionalism, ethical conduct, sustainability, austerity, prudence, teamwork, compliance with prevailing legislation and any internally established regulations that may be applicable, transparency, and respect for the privacy and intimacy of the various data subjects whose personal data is subject to processing.

All staff must formally declare their commitment to the Code through a personal and tailored adoption process. They are given a initial deadline to complete this task, which is monitored on a weekly basis.

Banco Sabadell Group Anti-Money Laundering and Counter-Terrorist Financing Policy

Money laundering and terrorist financing (hereinafter, ML/TF) are severe crimes that damage the global economy and represent a threat to worldwide social and financial stability.

Banco Sabadell Group is firmly committed to anti-money laundering and countering the financing of terrorism (hereinafter, AML/CFT), which is a key element of its fight against financial crime. It is essential to detect and prevent this type of illicit activity to protect and promote the integrity and trust of the markets and financial stability on a global scale.

For that reason, AML/CFT is a key pillar of the Institution's control framework. This model is applied in all entities of the Group, incorporating local regulations of the jurisdictions in which it is present, best practices of the international financial sector on this topic and the recommendations issued by international bodies such as the guidelines issued by the Financial Action Task Force (FATF), the Wolfsberg Group, the Basel Committee on Banking Supervision (BCBS) and Spain's Commission for the Prevention of Money Laundering and Monetary Offences (Comisión de Prevención del Blanqueo de Capitales e Infracciones Monetarias).

Banco Sabadell Group has an Anti-Money Laundering and Counter-Terrorist Financing Policy in place, approved by the Board of Directors, which establishes the basic principles, critical management parameters, governance structure, roles and responsibilities, procedures, tools and controls applicable in relation to AML/CFT and which describe the main procedures through which Money Laundering and Terrorist Financing risks should be identified and managed at all levels of the Group.

The Group defines roles and responsibilities on the basis of the model of three lines of defence:

• a) 1st line of defence, formed of business and management units;
• b) 2nd line of defence, which includes Compliance and Internal Control; and
• c) 3rd line of defence, comprising Internal Audit.

The Group's AML/CFT units are integrated in the second line of defence and their goal is to ensure the fulfilment of legal obligations in relation to AML/CFT. The function comprises one Group unit as well as local units in each of the obliged parties, led by designated officers in each of the geographies in which Banco Sabadell operates. In this respect, the Group's international presence means that it is subject to supervision by different regulators, requiring it to comply with a variety of regulatory requirements, which in turn requires it to have a global and cross-cutting risk management and control model.

It also has an Internal Control Body (hereinafter, ICB), which meets on a regular basis and whose mission is to oversee the implementation and effective fulfilment of its policies and procedures, thereby ensuring that ML/TF risk is appropriately managed in the Group.

The Group seeks to develop and continuously improve its ML/TF risk management model, which in accordance with Spanish regulations is reviewed annually by independent experts. In 2024, the external expert in question noted that Banco Sabadell Group has adequate control and detection systems in place designed to comply with anti-money laundering and counter-terrorist financing regulations.

In terms of training, each Group entity has an annual training plan. This plan outlines the training actions stipulated for the current year and the mandatory AML/CFT courses of each function. Employees are under the obligation to perform all AML/CFT training actions that they are invited to complete, so that they may prevent, avoid and/or detect any instances of money laundering and/or terrorist financing in the course of their professional activities. Completion of all training actions is duly validated and the level of completion of the annual training plan is documented.

Banco Sabadell Group Corporate Crime Prevention Policy

The purpose of Banco Sabadell Group's Corporate Crime Prevention Policy is to establish the applicable principles, critical management parameters, governance structure, roles and responsibilities, procedures, tools and controls relating to the prevention of corporate crime, and to ratify the firm commitment of the Group to abide by those rules as well as ethical standards and, in particular, its resolve to implement rules and controls to minimise the commission of crimes and to confirm the complete and absolute intolerance of any inappropriate behaviour and, especially, any conduct that may constitute a criminal offence. All this forms the Corporate Crime Risk and Anti-Corruption Management and Organisation Model. Ultimate responsibility for it lies with the Board of Directors, while the CEC is responsible for oversight of the functioning, observance and execution of that model, in accordance with the stipulations of the Policy.

The unit responsible for the Group Policy is the Compliance division, which also takes responsibility for defining general guidelines relating to the prevention of corporate crime and for supervising their appropriate implementation.

The Policy is applicable to the activity carried out by Banco Sabadell Group through its companies in the various territories in which it operates.

Its subjective scope of application extends to the Group's executives, legal representatives and employees and to all natural or legal persons providing services to or in the Group, as well as all collaborating partners, professionals or firms subcontracted by the same.

In 2022, AENOR Internacional S.A.U. conducted a full audit of the Corporate Crime Risk and Anti-Corruption Management and Organisation Model, with a view to ascertaining and certifying that Banco de Sabadell S.A.'s model complied with the requirements set forth by standards UNE 19601 on crime compliance management systems and ISO 37001 on anti-bribery management systems, obtaining both certifications in early 2023 and retaining them in 2024 upon satisfactorily completing the follow-up audit carried out by AENOR, with no Model Non-Conformities identified during the exercise.

As part of the commitment to the corporate crime prevention and anti-corruption model, and with a culture of ethics and compliance, all of the Bank's workforce is required, on a regular basis and whenever significant changes take place in the main policies on which it is based, to personally and individually undertake to follow Banco Sabadell Group's Corporate Crime Prevention Policy.

Banco Sabadell Group Anti-Corruption Policy

Banco Sabadell Group, as part of its activities, undertakes to safeguard integrity and promote a culture of zero tolerance of corruption, expressly prohibiting any and all actions of this kind.

Similarly, the Group undertakes to uphold the commitment undertaken as signatory of the United Nations Global Compact, with regard to compliance with the 10 principles established therein, among them that of working against corruption in all its forms, including extortion and bribery. In keeping with this, the Anti-Corruption Policy has been developed considering, among other reference documents, the UN Global Compact's Guide for Anti-Corruption Risk Assessment.

The purpose of the Anti-Corruption Policy is to establish the applicable principles, critical management parameters, governance structure, roles and responsibilities, procedures, tools and controls relating to anticorruption, and to ratify the firm commitment of the Group to abide by these rules as well as ethical standards and, in particular, its firm commitment to fight against corruption and to confirm the complete and absolute intolerance of any inappropriate behaviour. All this forms the Corporate Crime Risk and Anti-Corruption Management and Organisation Model. Ultimate responsibility for it lies with the Board of Directors, while the CEC is responsible for oversight of the functioning, observance and execution of that model, in accordance with the stipulations of the Policy and of the Corporate Crime Prevention Policy.

The unit responsible for this Policy is the Compliance division, which also undertakes responsibility for defining general guidelines relating to anti-corruption and for supervising their appropriate implementation.

The Policy is applicable to the activity carried out by Banco Sabadell Group through its companies in the various territories in which it operates.

Its subjective scope of application extends to the Group's executives, legal representatives and employees and to all natural or legal persons providing services to or in the Group, as well as all collaborating partners, professionals or firms subcontracted by the same.

As part of the commitment to the corporate crime prevention and anti-corruption model, and with a culture of ethics and compliance, all of the Bank's workforce is required, on a regular basis and whenever significant changes take place in the main policies on which it is based, to personally and individually undertake to follow the Anti-Corruption Policy.

Banco Sabadell Group General Policy on Conflicts of Interest

The ultimate and fundamental goal of the General Policy on Conflicts of Interest is to ensure that all those subject to that Policy act in accordance with the ethical standards and principles that govern the Group's activities, creating a culture of compliance and an action model based on honesty, professional accountability and impartiality and on the basis of the following guidelines:

• Measures should be in place to prevent conflicts of interest.
• If conflicts of interest occur or could potentially occur, measures should be in place that enable these to be detected, recorded and promptly dealt with.
• If any conflicts of interest do occur, they should be eliminated or, where that is not possible, the nature and origin of the conflict should be revealed to the customer or to the competent decision-making bodies in each case, so that they may make the necessary decisions.

This Policy is the responsibility of the Compliance division. In addition, the Board of Directors of the Group's parent company is responsible for approving this Policy and it delegates its supervision and control to the Corporate Ethics Committee.

The Policy is applicable to all Group companies and, consequently, to their directors, managers, employees and partners and to any individual directly or indirectly related to them, as envisaged by the regulations applicable to the area in which the potential conflict of interest arises.

Banco Sabadell Group Policy on the Internal Reporting System and Protection of Reporting Persons

The purpose of the Policy is to comply with that provided in Law 2/2023, which transposes Directive 2019/1937, and specifically with the duty to have a policy that sets out the general principles of the Internal Reporting System and the Protection of Reporting Persons, covering the internal communication system and its corresponding channels.

According to Banco Sabadell Group's Code of Conduct, the Group must carry out its business activity in compliance with the law and in an ethical, honest and transparent manner and showing the utmost respect for its people. Therefore, the Group has placed the necessary means at the disposal of its stakeholders, both internal (shareholders, directors, managers or existing and former employees) and external (subcontractors, partners, suppliers, etc.), so that they may report any issue or sign of a breach of the Code of Conduct, of internal and/or external regulations, and/or of the possible commission of a crime of which they become aware as part of their work or professional activity, without fear of any kind of retaliation when used in good faith.

The commitment to a culture of ethics and compliance materialises in the possibility of reporting irregular situations or conduct, as well as in the adoption of adequate measures in the event of potential breaches or, where appropriate, rectification of their consequences to prevent the damage from reoccurring in the future.

The Policy is applicable to the whole of Banco Sabadell Group in all matters that do not conflict with the applicable legislation in the corresponding jurisdiction.

The Internal Reporting System is generally the preferred means to report actions or omissions that may involve a breach of the law, of Banco Sabadell Group's Code of Conduct, or of the other internal regulations of the Group. Queries or questions may also be put forward in that respect.

The Bank's Board of Directors, as the Institution's most senior decision-making body, is responsible for implementing an Internal Reporting System and for appointing someone to be responsible for its management and for approving the Policy.

The Compliance division is responsible for the Policy and is in charge of its development and wording, proposing the necessary amendments and/or updates.

Business conduct training

In order for the workforce to be familiar with the details of the Code of Conduct's content, including the identification, reporting and management of conflicts of interest, and for them to undertake to effortlessly honour it, the main aspects of the criminal liability of legal persons, the risks in relation to corruption and bribery, types of corruption, prohibited actions and their consequences, as well as the existence, operation and guarantees of the whistleblowing channel, all employees are required to complete mandatory specific training courses on each of those subjects, which are reviewed regularly and updated as required.

In addition, employees are required to complete training on the Internal Code of Conduct in relation to the Securities Market (Reglamento Interno de Conducta, or RIC). The aim of the course is to explain what that code consists of, whom it affects and what restrictions it imposes. It also covers all circumstances in which an employee is required to comply with the RIC and the associated obligations. In addition, it teaches how to use the RIC portal, indicating the information that is available there and how it works. It also covers breaches, penalties and the role of the Corporate Ethics Committee.

The courses that employees are required to complete in relation to business conduct, along with the percentage completion of those courses, is shown here below:

Course	% completion
Code of Conduct	98.9%
Internal Code of Conduct relating to the securities market (RIC)	99.0%
Anti-Corruption	99.2%
Corporate Crime Prevention	99.5%
Whistleblowing channel and protection of reporting persons	97.5%

In addition, in order to facilitate continuous and voluntary learning with new and interesting formats, such as infographics, short videos, comic strips, posts, etc., the Bank's workforce is given access to the training space known as the "Regulatory School". This space has different sections called 'classrooms' dedicated to specific topics such as anti-money laundering and counter-terrorist financing, data protection, and ethics and conduct. In the last of these classrooms, staff have access to content related to corporate crime, so that they may learn what it consists of and become familiar with risks of corruption and bribery, conflicts of interests, how to identify them, how to manage them and where to report them, and with the whistleblowing channel, specifically how it works, the guarantees that it provides and how to access it. On the other hand, in the section dedicated to 'Conduct', they can find the relevant materials, related information and the Group's own Code of Conduct as well as the Suppliers' Code of Conduct.

On a regular basis, Banco Sabadell's Board of Directors also receives training in relation to corporate crime prevention, the prevention of corruption, and on the corporate crime and anti-corruption organisation and management model.

Internal Reporting System - Whistleblowing channel

As part of its commitment to a culture of ethics and compliance, the Group has an Internal Reporting System for reporting, in general, actions or omissions that could entail a breach of prevailing legislation, of the Group's Code of Conduct or of other internal regulations.

Banco de Sabadell, S.A., as the Group's parent company, has a whistleblowing channel available to its stakeholders and subsidiaries (except those in Mexico and the UK, which have their own channels), as a formal whistleblowing mechanism, one of the guiding principles of which is the protection of the reporting person.

As mentioned previously, the Institution has a Policy and Procedure for the Internal Reporting System and Protection of Reporting Persons that describe the principles and safeguards of the Internal Reporting System and the process and main stages of the management of whistleblowing reports.

The CEC is responsible for the Group's Internal Reporting System in the case of the Bank and subsidiaries, except those in Mexico and the United Kingdom, where their respective Boards of Directors have assigned responsibility for taking action to the Audit Committee in the case of Banco Sabadell, Institución de Banca Múltiple in Mexico and SabCapital S.A. de C.V. SOFOM E.R., and to the Whistleblower Champion in the case of TSB.

In this respect, the CEC is responsible for managing the Group's Internal Reporting System and also the whistleblowing channel, as one of its components.

The CEC, as a collegial body, delegates to its Secretary, who is a CEC member and the Chief Compliance Officer (CCO), the role of managing the whistleblowing channel and processing whistleblowing reports, within the scope that may be determined, at any time, in the CEC's Rules of Procedure.

The CEC and, by delegation, the CCO, shall carry out the role of Head of the Reporting System independently and autonomously of the administrative or governance bodies, committees, or staff of the Institution and its Group, provided this is so envisaged in the prevailing legislation, without taking instructions of any kind in the performance of their duties, and they shall have access to all human and material resources necessary to carry out their role. Thus, the CEC, and by delegation the CCO, shall have at their disposal the human resources assigned to Compliance to carry out their role, and may request support from the staff of that function and, within it, the Corporate Crime Prevention and Code of Conduct Management unit.

The channel is hosted on a platform that can be accessed through the Banco Sabadell Group website (https:// canaldenunciESGrupo.bancsabadell.com) and it is the main method used to report, detect and manage potential irregularities that could undermine the aforesaid commitment or that could constitute the commission of a crime. Any Group employee or related person (subcontractors, partners, suppliers, etc.) must report any information or sign of a breach of the Code of Conduct or of the commission of a potential crime of which they become aware.

As for the regular reporting on the activity and operation of the Internal Reporting System, the CEC prepares a quarterly report and the Board Audit and Control Committee and the Board of Directors are informed on a semiannual basis of the number of reports received during the corresponding period, the channel of origin, the type of report, the type of reporting person (named or anonymous) and the outcome of the investigation, together with the possible application of the internal penalties regime stemming from the reports filed. Those same reports also include information relating to the reports managed through the internal systems of TSB and Banco Sabadell Mexico.

In order to become familiar with the operation and guarantees of the internal whistleblowing channel, the workforce is required to complete a mandatory course on the channel and on the protection of reporting persons, which includes all of the new content related to Law 2/2023.

Similarly, in the 'Regulatory School', the workforce has access to a space dedicated to 'Corporate Crime and Anti-Corruption', within the 'Ethics and Conduct' classroom, which contains specific content about the whistleblowing channel, specifically what it is, who it is for, how to use, how to access it, the details that must be indicated in any reports, the guarantees that it offers and its ultimate goal.

Staff from the Corporate Crime Prevention & Code of Conduct Management unit have the necessary training to adequately perform their duties of managing the whistleblowing channel and dealing with any reports submitted.

In accordance with the Procedure for the Internal Reporting System and Protection of Reporting Persons, staff that file a report are protected in accordance with that set forth in Directive (EU) 2019/1937, which was transposed into Spanish law through Law 2/2013, specifically:

• Ensuring anonymity and confidentiality. Staff may submit reports on a named or, if they prefer, anonymous basis, in which case the Institution will not attempt (and will ensure that the rest of the Group does not attempt) to uncover their identity. If they do decide to identify themselves, their identity and that of any other person concerned is guaranteed to be kept under the strictest confidence, as is any information that they provide and their personal data.
• Ensuring the absence of any retaliation against reporting persons acting in good faith, declaring any act that constitutes retaliation or threats, or any attempted retaliation or threats, to be invalid. To that end, the requisite measures will be adopted to prevent and avoid retaliation against the reporting person.

Similarly, where appropriate and possible, Banco Sabadell will check in with the reporting person on a regular basis, in accordance with that provided in the Internal Non-Retaliation Protocol.

All reports submitted through the channel have been duly investigated and processed. The Procedure for the Internal Reporting System and Protection of Reporting Persons sets out all stages involved in dealing with reports submitted through the channel, such as:

• Receipt, acknowledgement of receipt to the reporting person, record-keeping and decision-making regarding the report's admissibility or inadmissibility.
• Information provided to the parties: reporting person and reported person.
• Opening of the case file and appointment of the investigator.
• Issuance of internal investigation report and proposed resolution (archiving or adoption of corrective measures/application of the internal penalties regime) and closure of the case file.

As at 31 December 2024, a total of 74 reports had been received, 31 of which were admitted for processing and investigated, with the investigation still ongoing for 2 of them. 41 were rejected (in 11 cases because they did not fall within the personal scope, in 24 cases because they were outside of the channel's material scope and in 6 cases due to insufficient information), while 2 had not yet been admitted/rejected.

Broken down by type of report, those related to workplace harassment/discrimination had the highest number of reports (18), followed by breaches of the code of conduct and internal regulations (13) and breaches of banking/product selling regulations (6).

Of the 31 reports processed, the investigations carried out concluded that a breach had only occurred in 14 cases, resulting in disciplinary actions on 6 occasions, with 1 disciplinary dismissal.

None of the reports received in 2024 resulted in the confirmation of cases related to corruption or bribery, or to human rights violations in Banco Sabadell Group.

In accordance with that set forth in the Equality Plan, any report aimed at exposing a possible act of discrimination, workplace and/or sexual harassment or gender-based harassment is channelled through the whistleblowing channel. Once the report has been admitted for processing, the Harassment Prevention Committee will run point and lead the investigation.

Through the whistleblowing channel, a person within the personal scope of application may report cases related, among other things, to corruption/bribery, human rights violations, or to breaches of bank regulations, the Code of Conduct, or internal regulations.

In accordance with that provided in the Anti-Corruption Policy, no distinction is made between areas that may have greater or lesser exposure to risks of corruption and bribery. That Policy is applicable to the directors, legal representatives and employees of the Group and to all natural and legal persons providing their services in the Group, as well as collaborating partners, professionals or entities subcontracted by the same.

As part of the commitment to the corporate crime prevention and anti-corruption model, and with a culture of ethics and compliance, all of the workforce of Banco de Sabadell, S.A. and its domestic subsidiaries is required, on a regular basis and whenever significant changes take place in the main policies on which it is based, to personally and individually undertake to follow Banco Sabadell Group's Corporate Crime Prevention Policy and the Anti-Corruption Policy.

5.4.3.3. G1-2: Management of relationships with suppliers

The new challenges of competition and those faced by society today require close coordination between the Group and its suppliers, viewing the latter as partners and collaborators to help achieve strategic objectives and to ensure fulfilment of the goals and commitments in relation to sustainability (including their environmental, social and governance-related components).

In order to establish this long-term cooperation, it is also necessary to understand the needs and goals of suppliers, maintaining a willingness to honour their commitments and making them compatible with the Group's requirements and vision.

Under this premise, the Group has a Procurement Policy and a Policy on the Outsourcing of Functions, as well as several associated procedures and mechanisms through which it extends its commitment to socially responsible practices to the supply chain. These practices include the advocacy of human rights, workers' rights, freedom of association and environmental rights. These policies, procedures and mechanisms cover the entire end-to-end relationship with suppliers, from the start of the supplier accreditation and procurement process until the services are provided, controlled and monitored. The two policies are reviewed and approved annually by the Board of Directors.

The Group's Procurement Policy and its associated procedures lay down mechanisms and controls to ensure the adequate management of the actual and potential impacts of all third-party engagements, ensuring the following principles:

• a. Cost-benefit analysis: all goods or services should be purchased or hired with the intention of ensuring that the benefit obtained outweighs the cost of producing them internally.
• b. Competition guarantee: fair competition and equal opportunities among suppliers must be ensured, seeking to offer all those taking part in the bidding process the same opportunities, always provided they meet the minimum requirements, including obligations in relation to social responsibility.
• c. Preservation of capabilities and responsibilities: procurement activities should not reduce the Group's internal control capabilities or make it any less able to fulfil its responsibilities before competent authorities and supervisory bodies.
• d. Sustainability: the Group should ensure that it promotes the engagement of suppliers that apply best practice in matters related to ethics, governance, society and the environment.

The supplier engagement process comprises various phases:

Identification of need

The Group's various business units detect the need and make a decision, with Management's authorisation, to proceed to formally request initiation of the procurement process in order to meet the identified need.

Detailed analysis and definition of the engagement strategy

Regulatory and legislative impacts of the procurement process are identified, thereafter deciding on the most suitable purchase process (e.g. tender process led by the Purchasing division, tender process delegated to the unit that put forward the request, bilateral negotiation captained by the Purchasing division).

The accreditation process, a prerequisite for a supplier to be awarded a service contract, ensures that suppliers meet the standards set out in the Group's various policies and comply with the Supplier Code of Conduct, which comprises:

• The United Nations' Universal Declaration of Human Rights.
• The International Labour Organisation's conventions.
• The United Nations' Convention on the Rights of the Child.
• The principles of the United Nations Global Compact, signed by the Group in February 2005, in the areas of human rights, labour, the environment and freedom of association.

In order to proceed with the accreditation process, suppliers must provide their legal documentation, financial information, quality certificates, tax clearance certificates proving they are up to date with their social security payments and tax obligations (or similar certificates to that effect depending on the geography), as well as their policy on Corporate Social Responsibility (CSR) and aspects related to sustainability (governance of the organisation, society and community, and environment), assigning a rating to suppliers (A+, A, B, C or D) based on the information provided. Accordingly, ISO certifications (ISO 9001, ISO 14001 and other certificates related to quality, environmental management, labour relations and occupational hazard prevention or similar) are requested, as well as disclosures of information related to the company's CSR and/or sustainability. In addition, details of the characteristics of the products made available to the Bank by the supplier (recycled, eco-friendly and reusable products) are also required.

Supplier validations are carried out on a regular basis, checking that the documentation provided by suppliers is fully up to date to ensure compliance with supplier accreditation criteria, establishing mechanisms for sending regular alerts.

For supplier engagements in Spain (which account for over 73% of the Group's third-party billing), the Bank has updated its supplier relationship management model to include the supplier rating system known as "RePro", created by ACHILLES South Europe, S.L., which gives useful information about partners that have responsible practices throughout its entire supply chain (assigning an ESG rating to each of them), ensuring that it only works with those that are closely aligned with its targets in relation to social, ethical and environmental responsibility. Furthermore, for suppliers not registered on the RePro system, the Bank has its own mechanisms that it uses to obtain a rating.

On the other hand, in terms of information security and the protection of data owned by the Group and to which suppliers have access, an analysis is conducted prior to engaging any potentially sensitive services in that regard, and specific monitoring exercises are carried out depending on the supplier's inherent risk.

Supplier engagement

The standard contract with suppliers includes clauses concerning the respect of human rights and the observance of the ten principles of the United Nations Global Compact on that matter, also including labour rights, the fight against corruption, restrictions on lending and investment in activities in the arms industry, and the equality plan.

The Group ensures compliance with the laws and regulations applicable at any given time, with contracts stipulating the ability to require suppliers to adapt their activities and service level agreements to those regulations.

Supplier engagement in the international network is decentralised, hiring mostly local suppliers and affecting only products for sole use by the relevant branch or office in its day-to-day activities. The hiring of local suppliers (those whose tax identification number coincides with the country of the company receiving the goods or services) contributes to the economic and social development of the regions in which the Group operates.

For services considered to be outsourced services (as per criteria in EBA/GL/2019/02) and/or critical services, the requirement is to perform a risk assessment for each supplier/service combination. The risk assessment is reviewed at regular intervals throughout the life cycle of the service. The risk assessment analyses different types of risk (i.e. reputational, operational, ICT, compliance, legal, step-in, country, systemic and concentration risks), paying particular attention to services with high risk levels.

Monitoring

For services categorised as outsourced (as per criteria of EBA/GL/2019/02) and/or critical (to business continuity, for example), regular exercises are carried out to monitor the supplier's performance and their fulfilment of their contractual obligations, which include aspects such as the monitoring of business metrics to ascertain the level of service, or the application of the agreed relationship governance model and official releases/reports published on those forums. Based on these monitoring exercises, an overall appraisal is obtained of both the service provided and the supplier themselves.

Regulation (EU) 2022/2554 of the European Parliament and of the Council of 14 December 2022 on digital operational resilience for the financial sector (DORA) came into force in January 2025. Its aim is to increase the level of control over technological services to reduce the digital risk of financial institutions, exercising greater control over providers of ICT or technological services. In this regard, the Group has initiated the process to adapt its services to the aforementioned regulation.

Audits

Internal Audit conducts regular audits of supplier engagement processes in general and of outsourcing providers in particular (EBA/GL/2019/02 criteria).

The audit recommendations resulting from those evaluations found no critical aspect and are being implemented in accordance with the established calendar.

Information about suppliers

In 2024, the top 20 suppliers represented 37.72% of all supplier invoicing. Other noteworthy aspects are included in the following table:

	2022	2023	2024
Total number of suppliers who had invoiced more than 100,000 euros as at year-end (1)	577	845	740
Percentage of suppliers of critical services (out of total suppliers)	7.3%	7.7%	8.9%
Total number of approved suppliers (2)	1,376	2,303	2,270
Amount invoiced by Special Employment Centres	€3.7m	€3.1m	€2.9m

These figures exclude those relating to brokerage, securities firms, subsidiaries, duties and taxes, pension funds, homeowners' associations, SOCIMIs (REITs) and rental of premises.

(1) The year 2024 includes 438 suppliers in Spain, 228 suppliers in TSB, 40 suppliers in Mexico, and 34 suppliers in foreign branches.

(2) The year 2024 includes 1,369 suppliers in Spain, 342 in Mexico, 525 in TSB and 34 in branches with billing of > €100,000.

Policy to prevent delays in payments to suppliers

To prevent delayed payments, Banco Sabadell has an internally developed platform that serves as an in-tray for invoices, in which suppliers send their own invoices, thus preventing them from being lost. This platform serves not only as a channel for receiving and approving invoices, but also as a documentation repository.

Once submitted by suppliers, invoices undergo an approval workflow in which managers approve their respective invoices and, once approved by all corresponding levels, they are relayed to the Invoices Management unit so that each invoice may undergo formal and fiscal validation and be entered in the accounts. The time available for validation and account entry is four days (two for validation and two for accounting), although usually the entire process is completed within two or three days at most.

In addition, the Bank's regulations state that on the 10th and 25th of every month, payments should be launched to all suppliers; however, since March 2020 (due to the pandemic) to date, payments have been launched on a weekly basis.

5.4.3.4 G1-3: Prevention and detection of corruption and bribery

The Group undertakes to safeguard integrity and promote a culture of zero-tolerance of corruption, expressly prohibiting any and all actions of this kind. Similarly, as a signatory of the United Nations Global Compact, it is committed to complying with the ten principles established therein, among them that of working to combat corruption in all its forms, including extortion and bribery.

The Group's Anti-Corruption Policy defines all acts that would qualify as corruption, as well as actions related to the topic that are not permitted. It is available to the entire workforce on the corporate intranet and also to business partners, as it is also published on the corporate website.

As for the identification and control of risks related to corruption, it should be pointed out that a Corporate Crime Risk and Anti-Corruption Management and Organisation Model is in place, which is re-evaluated annually and has its own specific section on the fight against corruption. As a result of the activities carried out as part of the aforesaid model and the management of the whistleblowing channel, described above, no risks related to corruption materialised in 2024, 2023, 2022 or in 2021.

The whistleblowing channel has a specific area dedicated to submitting reports of 'corruption / bribery', through which those covered by the personal scope of application may submit reports, which will be covered by the guarantees and dealt with and investigated in an independent and impartial manner, according to that provided in the Banco Sabadell Group Policy on the Internal Reporting System and Protection of Reporting Persons and its implementing procedure.

Particular importance is also attached to the oversight of loans and accounts held by political parties, by following a very rigorous customer onboarding protocol, and to the controls over donations and contributions received from third parties. Similarly, the Bank does not make contributions of any kind to political parties, politically exposed persons or related institutions. Likewise, in terms of transparency, all donations to NGOs and foundations are analysed and assessed by the Foundation's Board of Trustees. In relation to the Bank's sponsorship commitments, internal regulations are available containing criteria for their final approval or rejection.

5.4.4 Metrics and targets

5.4.4.1 G1-4: Confirmed incidents of corruption or bribery

In relation to incidents of corruption and bribery, it is important to note that in 2024:

• There have been no convictions or fines for breaches of anti-corruption and bribery laws.
• There have been no confirmed incidents of corruption or bribery in the Institution, with no employee having been dismissed or penalised internally for incidents related to this topic, and with no contract with business partners having been terminated or not renewed due to infractions related to corruption and bribery.
• At present, there have been no public legal cases regarding corruption or bribery brought against the undertaking and its own workers during the reporting period or during previous years.

5.5. Entity-specific disclosures: Tax responsibility

One way in which Banco Sabadell Group's commitment to sustainability materialises is in the promotion and development of responsible tax management, aligned with the Sustainable Development Goals (SDGs) approved by the United Nations.

The action principles followed for tax matters are geared towards compliance with the SDGs, particularly those relating to fostering a fairer, more respectful, sustainable and cohesive society (e.g. "No poverty", "Reduced inequalities"), SDG 8 "Decent work and economic growth" being one of the priority goals for the Group according to the Group's Sustainability Policy⁶⁶ that is closely related to tax affairs.

Tax strategy

The principles of the Group's tax-related actions are listed and explained in the tax strategy approved by its Board of Directors⁶⁷, which is reviewed annually, although it can be adapted if necessary in the event of regulatory changes or changes in the fiscal environment.

The tax strategy is applicable to all companies controlled by the Group and they are all required to comply with it, regardless of their geographical location, without prejudice to any adaptations made to comply with the requirements of jurisdictions' own legislation, as in the case of the United Kingdom. Such transpositions must be aligned with the principles, values and common action guidelines established in the aforesaid tax strategy. Similarly, the Group undertakes to ensure that, for investments in which control is shared with partners outside of the Group, or in which there is a significant shareholding, certain action principles in relation to tax matters are followed that are aligned with the tax strategy.

The tax strategy's principles and action guidelines are established in a way that is aligned and consistent with the Group's mission, values and business strategy, based on ethical and responsible management, guiding its commitment so that its activities have a positive impact on society as a whole. In the same vein, the business strategy is geared towards profitable growth that generates value for shareholders, with a conservative risk profile, as part of the framework of ethical and professional codes and taking into account the needs of the various stakeholders.

To that end, the Group has a set of policies, internal rules and codes of conduct that guarantee the aforesaid ethical and responsible behaviour at all levels of the organisation and in all of its activities.

The Group's Code of Conduct establishes the fulfilment of tax obligations as one of the fundamental elements that will allow it to deliver on its commitment to the economic development of society in all jurisdictions in which it operates⁶⁸, and to act in accordance with the principles established in its tax strategy, as well as making tax contributions stemming from the Group's responsible taxation actions in each of those jurisdictions.

In order to detect and manage any elements that could put the aforesaid ethical and responsible behaviour at risk, the Group has a complaints channel in place that enables participation and dialogue with the various stakeholders.

The principles set forth in the aforesaid tax strategy are the principles of efficiency, prudence, transparency and minimisation of tax risk, which aim to ensure compliance with current tax legislation by promoting responsible and transparent actions with regard to tax, in accordance with the requirements of customers, shareholders, tax authorities and other stakeholders. These principles are the following:

• Guarantee and ensure compliance with and observance of the current tax-related laws and regulations in effect in each and every one of the countries and territories in which the Group's companies operate and/or are present, as well as the international guidelines and principles stipulated in tax matters by the OECD, by means of a reasonable interpretation of the regulations that takes into account both their literal meaning and their spirit and purpose.

⁶⁶ The Sustainability Policy can be viewed on the corporate website: Policies, codes and rules

⁶⁷ The Tax Strategy can be viewed on the corporate website: Tax responsibility

⁶⁸ Banco Sabadell Group's Code of Conduct can be viewed on the website: Internal regulations

• Establish tax criteria on a sound legal basis, grounded in existing doctrinal and jurisprudential criteria, as well as international guidelines and standards.
• Verify that transactions are carried out only where there are sound commercial and business reasons, whilst ensuring that obtaining maximum tax efficiency is not prejudiced in the achievement of such an objective.
• Conduct the prior analysis of the tax implications of transactions with the aim of minimising tax risks, including reputational risk.
• Design and market banking products, assessing all their tax implications, which will be clearly and transparently communicated to customers.
• Value related party transactions, as legally defined at all times, on the basis of the arm's length principle in the terms established by the OECD, taking into account the functions, assets and risks of the parties involved, and observing the recommendations approved by the OECD.
• Avoid structures or entities of an opaque nature or resident in territories classified as tax havens/noncooperative jurisdictions whose purpose would be to reduce the tax burden of the Banco Sabadell Group. In the event of a presence or transactions in these territories, it shall be for economic and business reasons.
• Encourage constructive and collaborative relations with tax authorities on a reciprocal basis of good faith and transparency, guided by institutional respect and seeking mutually agreed solutions in case of divergent views. As an example of these initiatives, Banco Sabadell has adhered to the Code of Good Practices of the Spanish Tax Authority, acting collaboratively and in line with the recommendations set out in that text.

In addition, the tax strategy establishes that the Group shall disclose relevant tax information in a direct, clear and transparent manner to its customers and shareholders, to tax authorities and to other stakeholders, taking their needs into consideration.

The attainment of the objectives set out in the tax strategy and compliance with the fundamental principles that govern it are ensured through the establishment of a tax risk management and control system, which is embedded in Banco Sabadell Group's Global Risk Framework.

In this respect, the Group's Tax Risk Policy aims to ensure that any tax risks that could affect its tax strategy are identified, assessed and managed in a systematic way through their categorisation and proactive management, in order to anticipate, detect and respond to possible risk situations in an appropriate and timely manner. It also lays down a governance structure in relation to tax risk management and control, which ensures that the tax approach is embedded throughout the organisation.

The core principle of this structure is the direct involvement of the entity's governing and management bodies within a corporate model based on three lines of defence, with a clear assignment of roles and responsibilities and an adequate level of separation and independence to avoid compromising the effectiveness of this model.

In terms of the roles and responsibilities of the model of three lines of defence:

• The first line of defence includes (i) the business and support units responsible for complying with Banco Sabadell's obligations in tax matters, and for managing the corporate and operational processes that support the information and data necessary for the correct calculation of taxes and reporting to the Public Administration agencies and (ii) Tax Advisory, which, by establishing the tax criteria applicable in taxation matters, oversees the proper application and due compliance with the principles governing this tax strategy as well as promoting actions aimed at increasing knowledge and awareness of tax risk in the Group. An example of such actions is the effort to keep on top of the ever-changing tax regulations and standards in relation to responsible taxation; these tasks are carried out through an ongoing review by the experts dedicated to this topic, who prepare the corresponding communications that are then supplemented with the necessary explanations and training content aimed at the units affected by any tax-related amendments, generating a process of fluid and continuous communication.

• The second line of defence includes Internal Control and Regulatory Compliance, which, in general terms, must ensure that the first line of defence is well-designed and performs its assigned duties, with a view to its continuous improvement.
• Lastly, the supervisory function of the third line of defence is carried out by Internal Audit, whose mission is to help the Group to achieve its objectives by providing a systematic and disciplined approach to assess the adequacy and effectiveness of the organisation's governance processes and its risk management and internal control activities.

To this end, the Board Audit and Control Committee supervises the Group's tax management, focusing particularly on the implementation of the tax strategy and its guiding principles, through regular reports received from Tax Advisory regarding the actions carried out to adequately analyse tax affairs, the main tax-related proceedings and actions on Corporate Tax Governance (such as the voluntary submission of the Annual Tax Transparency Report for 2023, or the development of the stages subsequent to the submission and receipt of the Annual Tax Transparency Report for 2022)⁶⁹ .

It also ensures the continuity of the management and control system, which guarantees the application of the principles laid down in the tax strategy, through mechanisms for the smooth succession of certain positions, as provided in the Group's internal regulations.

Collaborative relationship with the State Tax Agency, Good Tax Practices and Transparency

Banco Sabadell adheres to the Code of Good Tax Practice (Código de Buenas Prácticas Tributarias, or CBPT), approved by the Large Companies Forum, of which it is a member, and acts in accordance with the recommendations contained therein. Banco Sabadell voluntarily submits the "Annual Tax Transparency Report" on a yearly basis to the State Tax Agency (AEAT)⁷⁰ .

It also proactively collaborates with competent authorities, accommodating their requests and taking part in cooperative forums and schemes promoted by local authorities, such as the Large Companies Forum, in order to help strengthen the fiscal system and prevent the generation of tax-related litigation and conflicts⁷¹. In addition, it takes part in the tax boards of various associations, which address topical matters, such as the Spanish Banking Association (Asociación Española de Banca, or AEB), the Spanish Confederation Business Organisations (Confederación Española de Organizaciones Empresariales, or CEOE), and the Spanish International Chamber of Commerce (ICC Spain).

Furthermore, through its subsidiary in the United Kingdom, it follows the Code of Practice on Taxation for Banks, promoted by the UK tax authorities, complying with its content.

In line with the principle of transparency, the Group discloses relevant tax information directly, clearly and transparently to its customers and shareholders, to tax authorities and to all other stakeholder groups, and it includes that information in the various documents accessible on its corporate website (Tax Strategy, Annual Financial Statements, Board Audit and Control Committee report, Tax Liability and Tax Responsibility and Good Practices document, etc.). It also monitors the various initiatives in relation to tax transparency, in order to continuously make progress in this regard and instil best practice in its organisation.

This commitment to the principle of transparency has been recognised by Fundación Haz, which awarded Banco Sabadell the "t for transparent" label in relation to the tax information published for 2023. The Institution

⁶⁹ The report on the operation and activities of the Board Audit and Control Committee, which is available on the corporate website: https://www.grupbancsabadell.com/corp/en/corporate-governance-and-remuneration-policy/comittee-reports.html, contains details of the key aspects relating to the financial year 2024

⁷⁰ The Annual Tax Transparency Report for the 2023 financial year was sent to the AEAT in October 2024

⁷¹ Information on this topic can be found in the document "Tax Responsibility and Good Practices of Banco Sabadell Group", which is available on Banco Sabadell's website. Details about the status of the main tax disputes and the years open to tax inspection can be found in Banco Sabadell Group's consolidated annual financial statements for 2024 (Note 39 – Tax situation)

received the highest rating category for the third consecutive year, as a result of complying with 100% of the transparency and tax responsibility indicators.

Presence in tax havens/non-cooperative jurisdictions

In accordance with the corporate principles governing its tax strategy and the CBPT to which it adheres, Banco Sabadell Group has undertaken a commitment to avoid opaque structures or entities resident in tax havens/ non-cooperative jurisdictions, unless their presence or operations are justified on economic or business grounds. Therefore, given that there is no single definition of the concept of a tax haven / non-cooperative jurisdiction, the Group takes into consideration the lists of tax havens/non-cooperative jurisdictions set out regulations in Spain⁷² and the criteria of the EU⁷³ and the OECD⁷⁴, which are put together on the basis of a series of characteristic aspects, such as lack of transparency, low or non-existent taxation, or the absence of any regulations that permit the exchange of information.

Thus, pursuant to the commitment it has taken on, Banco Sabadell Group has no active presence in territories considered to be tax havens/non-cooperative jurisdictions, in accordance with the applicable regulations in Spain⁷⁵, the stance of the European Union and the criteria of the OECD⁷⁶, as stated in the 'Declaration of presence in territories classified as tax havens/non-cooperative jurisdictions', published on Banco Sabadell's website⁷⁷ .

On the other hand, on an international scale, there are several non-governmental organisations, such as the Tax Justice Network, Oxfam Intermon, the Fair Tax Foundation and the Observatorio de Responsabilidad Social Corporativa, which have put together, according to their own criteria, lists of non-cooperative jurisdictions, and even lists that make reference to other additional concepts, such as tax haven (territories that have approved tax-related and legal frameworks that are thought to reduce the payment of taxes to the bare minimum) or tax niches (territories which, in certain circumstances, permit taxation that is considered to be extremely low, even though the usual taxation regime is normal).

As an additional exercise in transparency, and heeding the opinions and concerns expressed by the aforesaid organisations (that comprise one more of Banco Sabadell Group's stakeholder groups), the lists of territories identified by those organisations have been reviewed and the information in this regard has been included in the "Tax Responsibility and Good Practices" document⁷⁸. In any case, the active presence in those territories is only ever due to business reasons (such as the banking activity carried out in the United Kingdom, Mexico and the United States) and, in the case of any presence with no activity with third parties (Jersey, Bahamas and Andorra), that presence is irrelevant or practically non-existent as those companies are in the process of liquidation.

⁷² Law 11/2021 of 9 July and Order HFP/115/2023 of 9 February determining countries and territories, as well as harmful fiscal regimes considered non-cooperative jurisdictions

⁷³ List of non-cooperative countries and territories for tax purposes

⁷⁴ List of territories that do not meet standards of transparency and exchange of information, neither in relation to the Automatic Exchange of Information (AEOI) nor in relation to the Exchange of Information on Request (EOIR)

⁷⁵ The Group has no active presence in Jersey through any subsidiary or permanent establishment, nor does it have any representative office in that territory. Its presence in Jersey is limited to a trust established in 2014 to manage and monitor long-term incentive plans established in connection with staff at TSB through the acquisition and delivery of shares to employees under the framework of those plans. Similarly, as can be seen in Schedule I to the consolidated annual financial statements for 2024, the presence in this territory is not material

⁷⁶ The Bahamas territory was removed from "The EU list of non-cooperative jurisdictions for tax purposes" in February 2024, although the OECD considers it a non-compliant territory in its list "Automatic Exchange of Information". In any case, the Group has no active presence in that territory through its subsidiary Bahamas Bank & Trust Ltd., which is a company with no activity (incorporated into the Group as a result of the merger by absorption of Banco Atlántico in 2006) that is currently in the process of liquidation.

⁷⁷ The statement is available in the document "Tax Responsibility and Good Practices of Banco Sabadell Group", which can be accessed through Banco Sabadell website through the following link: https://www.grupbancsabadell.com/corp/en/sustainability/ fiscal-transparency.html

⁷⁸ The following references were used: (i) "Identifying tax havens: characteristics and 2023 tax haven listing" by Fair Tax Foundation, (ii) "Corporate Tax Haven Index" and "Financial secrecy Index 2022" by Tax Justice Network, taking the first 30 countries of each index as reference, (iii) "Desigualdad S.A., filial en España" by Oxfam Intermon, and (iv) "La Información sobre Sostenibilidad en las empresas del IBEX 35, ejercicio 2022" by Observatorio de RSC. The document "Tax Responsibility and Good Practices of Banco Sabadell Group" is available on the corporate website at the following link: https://www.grupbancsabadell.com/corp/en/ sustainability/fiscal-transparency.html

Breakdown of profit and tax information by country

Consolidated profit or loss before tax in each country⁷⁹ and details of Corporate Income Tax (CIT) paid and accrued are set out below.

	Consolidated profit or loss before tax		CIT paid80		CIT accrued
Country	2024	2023	2024	2023	2024	2023
Spain	1,825,882	1,331,993	222,372	289,125	(509,860)	(412,217)
UK	400,486	304,732	84,162	44,361	(113,317)	(84,715)
USA	173,396	155,442	33,350	57,631	(42,245)	(40,015)
Mexico	65,718	62,862	20,273	16,090	(6,489)	(12,006)
France	39,212	27,465	12,479	(892)	(9,420)	(5,541)
Portugal	5,404	5,059	2,340	1,391	(2,289)	(1,676)
Morocco	4,046	3,323	1,475	1,150	(1,652)	(1,004)
Jersey	2	1	—	—	—	—
Andorra	(16)	(9)	—	—	—	—
Luxembourg	(90)	—	—	—	—	—
Bahamas	(142)	(90)	—	—	—	—
Total	2,513,898	1,890,778	376,451	408,856	(685,272)	(557,174)

Data in thousand euro.

The figure corresponding to CIT paid is determined on a cash basis, meaning that it takes into account the amounts paid for the income tax during the current year (which are mainly related to instalment payments and withholding taxes) and the amounts received (which are mainly related to tax refunds from previous years as a result of the submission of the final tax returns). The abovementioned is all based on the payment schedule and method to determine the payments on account, as established by the corresponding tax regulation applicable in each country. When applicable, payments/refunds derived from the tax proceedings carried out are also included.

The figure corresponding to CIT accrued is related to the corporation tax expense recognised in the consolidated income statements, according to the applicable accounting principles.

The two previous figures typically differ, as the first figure (CIT paid) is determined on a cash basis and therefore depends, among other considerations, on the method of calculation and the schedule of payments on account established in the corresponding tax regulation of each country, the payments and refunds of the tax corresponding to other years, or the application of tax credits generated in previous years, whereas the second figure (CIT accrued) depends, essentially, on the profit and loss of the relevant year.

The differences between the current nominal rate in a given jurisdiction and the effective rate resulting from considering CIT accrued and profit or loss before tax are mainly due to adjustments made to taxable income taking into account the applicable regulations in each jurisdiction (such as, for example, inflation adjustments in Mexico).

Other contributions

⁷⁹ As for the countries and figures included in the table, certain differences may arise in relation to other information included in the annual financial statements, which is essentially the result of (i) entities being sold or acquired during the year, or (ii) profit or loss contributed by companies consolidated using the equity method

⁸⁰ The 222,372 thousand euros figure shown in the column "Profit tax paid" in the Spain jurisdiction in 2024 (289,125 thousand euros in 2023) comprises 431,320 thousand euros of payments made for corporation tax during 2024 (294,610 thousand euros in 2023) and 208,947 thousand euros of refunded amounts (5,485 thousand euros in 2023). In addition, in Spain the temporary levy of credit institutions and financial credit establishments is paid, as detailed in the section "Other contributions"

In addition to profit tax, the Institution contributes to the deposit guarantee schemes in place in each geography and to the European Single Resolution Fund, which have a positive impact on citizens' economic and financial security. Furthermore, every year it pays the Tax on Deposits of Credit Institutions and the capital contribution payable due to the monetisation of DTAs⁸¹ and, since 2023, the temporary levy on credit institutions and financial credit establishments. The table below shows the breakdown of each of the contributions made:

	2024	2023
Contribution to deposit guarantee schemes	(25,083)	(150,784)
Banco Sabadell	(6,294)	(132,209)
TSB	(414)	(280)
Banco Sabadell IBM México	(18,375)	(18,295)
Contribution to resolution fund	—	(76,485)
Tax on Deposits of Credit Institutions	(37,972)	(34,418)
Capital contribution due to monetisation of DTAs	(35,982)	(46,251)
Temporary levy of credit institutions and financial credit establishments	(191,882)	(156,182)
Total	(316,003)	(614,904)

Data in thousand euro.

Public subsidies received

In 2024, subsidies received in Spain in relation to training amounted to 1,387,138 euros.

⁸¹ Deferred tax assets

6. Annexes

6.1 Initiatives and alliances

In a cross-cutting way and in line with its commitment to sustainability, Banco Sabadell continues to forge alliances with other sectors and is part of major international initiatives designed to fight climate change and improve social development:

• Signing, in 2005, the corporate responsibility initiative of the United Nations Global Compact and the ten principles in the areas of human rights, labour, environment and anti-corruption.
• Signing, in 2009, the Carbon Disclosure Project (CDP) for action against climate change.
• Signing, in 2011, the Equator Principles, which incorporate social and environmental criteria in largescale project finance and corporate loans.
• Adhering, since 2019, to the United Nations Principles for Responsible Banking, the first global framework of reference that defines the role and responsibilities of the banking industry in ensuring a sustainable future, to that end reinforcing the alignment with the SDGs in relation to the Paris Agreement.
• Ratifying, in 2019, the Collective Commitment to Climate Action, whose goals serve to further reduce the carbon footprint of balance sheets.
• Becoming a member, in 2020, of the Task Force on Climate-related Financial Disclosures (TCFD) for the disclosure of risks and opportunities related to climate change.
• Becoming a member, in 2021, of the Net-Zero Banking Alliance (NZBA), an international alliance convened by the United Nations Environment Programme Finance Initiative (UNEP FI), through which the Bank is committed to aligning its lending and investment portfolios with net-zero emissions by 2050, in line with the targets of the Paris Climate Agreement.
• Signing up, in 2022, to the Partnership for Carbon Accounting Financials (PCAF⁸²), in order to measure and disclose emissions financed through loans and investments in a standardised way.

In addition, in the Spanish market, the Bank collaborates with multisectoral and independent forums, such as the Spanish Observatory of Sustainable Financing (Observatorio Español de la Financiación Sostenible, or OFISO) and was recognised, in the financial institution category of the fifth edition of OFISO awards, for its sustainable financing.

In relation to infrastructure and facilities, five of the Bank's corporate buildings have the ISO 14001 certification and its Annual General Meeting of 10 April 2024 received the "Sustainable Event" certification from Econep Consultores S.L. (Eventsost), having been deemed compliant with sustainability criteria throughout the event life cycle.

In terms of social matters and at the national level, the Bank has renewed its membership of alliances in the fields of financial education, the workplace environment, diversity and gender parity, and it participates in various social development initiatives:

• On one hand, at the institutional level, the Bank has renewed its membership of the agreement signed between the Spanish Banking Association (AEB), the Spanish Securities Market Commission (CNMV) and the Bank of Spain to pursue courses of action under the framework of the National Plan for Financial Education and, on the other hand, it was once again awarded the "Equality in the Workplace" seal of distinction by the Ministry of Equality, and has signed up to the Plan MeCuida initiative promoted by the Spanish government.

⁸² The Partnership for Carbon Accounting Financials is a collaboration between financial institutions from all over the world, launched in 2019 to measure and disclose, in a standardised format, emissions financed through loans and investments. PCAF member institutions work together to develop the Global GHG Accounting and Reporting Standard for the Financial Industry. More information can be found athttps://carbonaccountingfinancials.com/Industries

• In terms of diversity, the Bank is a signatory of the "CEOs supporting diversity" (CEO por la diversidad) initiative promoted by the Adecco Foundation and the CEOE, and has signed the General Protocol for "More Women, Better Companies" (Protocolo General de Más Mujeres, Mejores Empresas) promoted by the Women's Institute, which establishes the commitment to boost internal diversity. Additionally, it is a member of the Business Network Association for LGBTI Diversity and Inclusion (REDI by its Spanish acronym), which works to promote safe and respectful workplace environments. It has also signed up to the Empowering Women's Talent initiative launched by Equipos&Talento, which focuses on the empowerment of women in companies, and it is also a member of Women in Banking (WIB), an initiative dedicated to promoting the role of women in Spanish banking. The Institution also forms part of the Commission for Women in Banking, an AEB initiative, aligned with the aim of increasing the visibility and recognition of the role of women in the banking industry, as well as promoting inclusion and diversity in decision-making processes.
• In terms of distinctions, the Bank was singled out in the list of the 25 best companies to work for in Spain, according to the #LinkedInTopCompanies 2024 ranking. This ranking, which includes companies with more than 5,000 employees, is based on criteria such as professional development, job stability and diversity. It also obtained the Top Employers in Spain certification granted by the Top Employers Institute.

In terms of governance, in the national perimeter, the Bank's membership of the Code of Good Banking Practice and the Code of Good Tax Practice, its membership of Autocontrol (independent advertising selfregulatory organisation in Spain), its receipt of certification of transparency and fiscal accountability ("t for transparent" label) awarded by Fundación Haz and the Gold Seal of Excellence awarded by the European Foundation for Quality Management (EFQM), all stand out. All of these certifications were awarded with distinctions of the highest order.

Noteworthy initiatives at TSB, the Group's leading brand in the United Kingdom, include its membership of the Good Business Charter, a national accreditation scheme that recognises businesses that behave responsibly, and its membership of the Prince's Responsible Business Network, a Business In The Community (BITC) initiative that helps companies to address a wide range of essential issues to build a fairer society and a more sustainable future. The Institution is also a member of the Prompt Payment Code and a signatory of HM Treasury's Mortgage Charter.

In Mexico, where the Group operates under the Banco Sabadell Mexico brand name, the Bank participates as a signatory of the Sustainability Protocol of the Association of Mexican Banks (Asociación de Bancos de México, or ABM) and is a signatory of the "Declaration in favour of the development of environmental, green and sustainable finance in the Mexican banking sector", promoted by the Green Finance Advisory Council (Consejo Consultivo de Finanzas Verdes, or CCFV) and the ABM. It is also a member of the Sustainability Committee of the Spanish Chamber of Commerce (Comisión de Sostenibilidad de la Cámara Española de Comercio, or CAMESCOM) in Mexico.

These alliances, which are all embedded in the ESG framework of Sabadell's Commitment to Sustainability, are additional to the Group's transformation and promotion actions, both those already carried out and those planned for the future, which are aligned with the Sustainable Development Goals (SDGs), where the Group has greater capacity to influence due to its systemic interconnectedness, its activity and its capacity to make an impact. In this respect, although the Institution's goal requires it to contribute to all SDGs, the following have been prioritised:

Affordable and clean energy. Decent work and economic

growth.

Industry, innovation and infrastructure.

Climate action. Peace, justice and strong institutions.

6.2 Principles for Responsible Banking: Responsible Banking Progress Statement

Principle 1	Principle 2	Principle 3
Alignment	Impact & Target Setting	Clients & Customers
Banco Sabadell aligns its strategy with the Sustainable Development Goals (SDGs) and the Paris Agreement, in order to support and accelerate the important economic and social transformations that contribute to sustainable development and the fight against climate change. In that regard, in 2022, the Group published the document Sabadell's Commitment to Sustainability, an action framework that integrates a forward-looking vision in relation to environmental, social and governance commitments, aligns business objectives with the SDGs and establishes action levers to generate transformation and promotion activities. In a cross-cutting way and in line with its commitment to sustainability, Banco Sabadell continues to forge alliances with other sectors and is part of major international initiatives designed to fight climate change and improve social development.	In 2022, Banco Sabadell carried out an analysis to identify the positive and negative impacts arising from its financing activities, in line with the requirements of the Principles for Responsible Banking of the United Nations Environment Programme Finance Initiative (UNEP FI). This analysis took place using the Portfolio Impact Analysis for Banks tool for the application of the Holistic Impact Methodology devised by UNEP FI. This analysis was updated in 2024, concluding that the most prominent areas of impact on the portfolio continue to be "Availability, accessibility, affordability and quality of resources and services" (in particular, "Access to finance and housing") and "Climate stability", given that the Institution's business model has not changed significantly in the last two years. In response to the requirements of the CSRD, a double materiality analysis was carried out, in which the results obtained from the Impact Analysis Tool for Banks were taken into account. The Bank has defined specific targets and objectives related to the most prominent impact areas, which are regularly monitored.	Banco Sabadell established Sabadell's Commitment to Sustainability as an ESG framework, in which one of the main courses of action is to support customers in the transition to a sustainable economy, laying down decarbonisation pathways, helping customers in the transition with specialised solutions for renewable energy, energy efficiency and sustainable mobility, and defining sectoral standards that limit controversial activities and/ or activities with negative impacts on environmental and social development. The Group promotes sustainable financing and investment to drive forward the transition towards a more sustainable model and a low carbon economy, offering customers and investors the best possible solutions. Therefore, as part of Sabadell's Commitment to Sustainability, the Bank undertook to mobilise a cumulative total of 65 billion euros of financial products and services in sustainable finance solutions during the 2021-2025 period. In the area of social loans, it is worth highlighting those granted to micro-enterprises for the purpose of promoting and maintaining employment.

Links and references	Links and references	Links and references
– Banco Sabadell's Commitment to Sustainability – Sustainability Report for the year ended 31 December 2024: • 3.1 SBM-1: Strategy, business model and value chain • 5.1.3.1 E1-1: Transition plan for climate change mitigation • 5.1.4.2 E1-2: Policies related to climate change mitigation and adaptation • 5.3.3.1 S4-1: Policies related to consumers and end-users • Annex 6.1 "Initiatives and alliances"	– Sustainability Report for the year ended 31 December 2024: • 3.1 SBM-1: Strategy, business model and value chain • 3.2 SBM-2: Interests and views of stakeholders • 4.1. Double materiality • 5. Material disclosures ◦ 5.1.5. Metrics and targets (Environmental: Climate change) ◦ 5.3.4 Metrics and targets (Social: Consumers and end users)	– Sustainability Report for the year ended 31 December 2024: • 3.1 SBM-1: Strategy, business model and value chain • 5.1.3.1 E1-1: Transition plan for climate change mitigation • 5.1.4.1 ESRS 2 IRO-1: Description of the processes to identify and assess material climate-related impacts, risks and opportunities • 5.1.4.3 E1-3: Actions and resources in relation to climate change policies • 5.2.3.4. S4-1: Policies related to consumers and end-users • 5.3.3.2. S4-2: Processes for engaging with consumers and end-users about impacts

Principle 4	Principle 5	Principle 6
Stakeholders	Governance & Culture	Transparency &
		Accountability
Banco Sabadell remains committed to its main stakeholders. To that end, it involves the main stakeholder groups and collaborates with them. The Group, in keeping with its commitment, has been conducting materiality assessments of topics related to sustainability, aligning with best practice in relation to sustainability and transparency. With the entry into force of the new European Corporate Sustainability Reporting Directive (CSRD), a new double materiality exercise has been carried out in order to identify the material impacts, risks and opportunities related to sustainability. As part of this process, the Bank's main stakeholder groups were identified by reviewing previous exercises, analysing recommendations included in the CSRD, and analysing peer group entities. The main stakeholders identified are the financial community (investors, shareholders and rating agencies), employees, suppliers, customers, organisations and institutions, society and peers. Once identified, channels to listen to what they had to say were determined.	The governance system and the organisation of the different decision-making levels are both being continuously improved and adapted to the needs that are emerging from the new sustainability environment. The remuneration policy and practices integrate sustainability risks, encouraging behaviour consistent with the Group's risk based approaches related to climate and the environment, as well as with the commitments voluntarily undertaken by the Group. The Bank continues to support workers in sustainability training, focusing on environmental management, the energy crisis and other content to provide continuous training on sustainability.	The references included in the Responsible Banking Progress Statement are part of the Group's Sustainability Report, which underwent limited independent third-party verification.

Links and references	Links and references	Links and references
– Sustainability Report for the year ended 31 December 2024: • 3.2. SBM-2: Interests and views of stakeholders • 3.3. SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model • 4.1. Double materiality • 5.3.2.1 ESRS 2 SBM-2: Interests and views of stakeholders • 5.3.3.2 S4-2: Processes for engaging with consumers and end-users about impacts	– Sustainability Report for the year ended 31 December 2024: • 2.1 GOV-1: The role of the administrative, management and supervisory bodies • 2.3 GOV-3: Integration of sustainability-related performance in incentive schemes • 2.4 GOV-4: Statement on due diligence • 5.2.3.4. S1-4: Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions – Section: "Training"	– Sustainability Report for the year ended 31 December 2024: • Audit Report

6.3 Taxonomy indicators

0. Summary of GAR KPIs in relation to turnover and CapEx KPIs

Summary of GAR KPIs in relation to turnover KPIs

Disclosure reference 31/12/2024	date	Total environmentally sustainable assets	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Main KPI	Green asset ratio (GAR) stock	8,292	4.43%		77.19%	25.72%	22.81%

		Total environmentally sustainable activities	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Additional KPIs	GAR (flow)	1,914	3.59%		82.05%	31.85%	17.95%
	Trading book
	Financial guarantees	8	1.01%
	Assets under management	96	2.03%
	Fees and commissions income89

Disclosure reference date 31/12/202383		Total environmentally sustainable assets	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Main KPI	Green asset ratio (GAR) stock	7,774		4.45%	72.99%	25.70%	27.01%
		Total environmentally sustainable activities	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Additional KPIs	GAR (flow)	2,149		6.30%	58.53%	29.01%	41.47%
	Trading book
	Financial guarantees	14		1.48%
	Assets under management	79		2.80%
	Fees and commissions income89

Summary of GAR KPIs in relation to CapEx KPIs

Disclosure reference 31/12/2024	date	Total environmentally sustainable assets	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Main KPI	Green asset ratio (GAR) stock	8,762		4.68%	77.19%	25.72%	22.81%
		Total environmentally sustainable activities	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Additional KPIs	GAR (flow)	1,999		3.75%	82.05%	31.85%	17.95%
	Trading book
	Financial guarantees	4		0.50%
	Assets under management	66		1.40%
	Fees and commissions income89

Disclosure reference 31/12/202383	date	Total environmentally sustainable assets			% coverage (over	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4
			KPI84	KPI85	total assets)86	1.1.2. of Annex V)87	of Annex V)88
Main KPI	Green asset ratio (GAR) stock	7,706		4.41%	72.99%	25.70%	27.01%

		Total environmentally sustainable activities	KPI84	KPI85	% coverage (over total assets)86	% of assets excluded from the numerator of the GAR (Article 7(2) and (3) and Section 1.1.2. of Annex V)87	% of assets excluded from the denominator of the GAR (Article 7(1) and Section 1.2.4 of Annex V)88
Additional KPIs	GAR (flow)	2,019		6.12%	58.53%	29.01%	41.47%
	Trading book
	Financial guarantees	14		1.48%
	Assets under management	146		4.84%
	Fees and commissions income89

⁸³ Data as at December 2023 in this and the following templates corresponds to the information published in the Pillar 3 Disclosures report for the year 2023, following the assessment carried out by the supervisor during 2024.

⁸⁴ Based on the counterparty's turnover key performance indicator.

⁸⁵ Based on the counterparty's CapEx key performance indicator, except in the case of loan activities for which, in relation to general loans, the turnover key performance indicator is used.

⁸⁶ % of assets covered by the key performance indicator relative to banks' total assets. Gross carrying amount of exposures in total GAR assets over gross carrying amount of total assets.

⁸⁷ Gross carrying amount of exposures not eligible for GAR calculation over gross carrying amount of total assets.

⁸⁸ Gross carrying amount of exposures not covered by GAR calculation over gross carrying amount of total assets.

⁸⁹ Fees and commissions income for services other than loans and assets under management.

Note: Tables 1, 2, 3, 4 and 5 below do not include information on the alignment of four new climate objectives (water resources, pollution, biodiversity and circular economy), as the information was not available. This information will be published next year.

1. Assets used to calculate the GAR in relation to turnover and CapEx KPIs

Assets used to calculate the GAR in relation to turnover KPIs

		a	b	c	d	e	f	g	h	i j	k	l m	n
								Disclosure reference date 31/12/2024
							Climate Change Mitigation (CCM)			Climate Change Adaptation (ACC)	Water and Marine Resources (WTR)
											Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible)
in million euros		Total gross carrying amount			Of which environmentally sustainable (Taxonomy-aligned)					Of which environmentally sustainable (Taxonomy-aligned)	Of which environmentally sustainable (Taxonomy-aligned)
									Of which			Of which
					Of which	Of which	Of which			Of which			Of which
					specialised lending	transitional	enabling		specialised lending	adaptation		specialised lending	adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	87,442	8,286	7,298	337	350	31 6	0	3	1
2	Financial corporations	14,675	2,443	177	0	21	34	7 1	0	0	0
3	Credit institutions	13,298	2,235	153	0	21	15	7 1	0	0	0
4	Loans and advances	11,061	2,086	143	0	19	13	6 1	0	0	0
5	Debt securities, including UoP	2,225	147	10	0	2	1	0 0	0	0	0
6 7	Equity instruments Other financial corporations	11 1,378	2 208	0 24	0	0 0	0 19	0 0 0 0	0	0 0	0 0
8	of which investment firms	1,309	192	22	0	0	19	0 0	0	0	0
9	Loans and advances	1,151	190	22	0	0	19	0 0	0	0	0
10	Debt securities, including UoP	48	0	0	0	0	0	0 0	0	0	0
11	Equity instruments	110	2	0		0	0	0 0		0	0
12	of which management companies	0	0	0	0	0	0	0 0	0	0	0
13	Loans and advances	0	0	0	0	0	0	0 0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0	0 0	0	0	0
15	Equity instruments	0	0	0		0	0	0 0		0	0
16	of which insurance undertakings	68	17	1	0	0	0	0 0	0	0	0
17	Loans and advances	43	17	1	0	0	0	0 0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0	0 0	0	0	0
19	Equity instruments	25	0	0		0	0	0 0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	3,155	1,178	366	275	316	24 5	0	3	1
21	Loans and advances	14,997	3,001	1,118	366	275	257	24 5	0	3	1
22	Debt securities, including UoP	259	154	60	0	0	60	0 0	0	0	0
23	Equity instruments	0	0	0	0	0	0	0 0	0	0	0
24	Households	92,597	81,843	6,931	6,931	41	0	0 0	0	0	0
25	of which loans collateralised by residential immovable property	78,458	78,458	6,890	6,890	0	0	0 0	0	0	0
26	of which building renovation loans	1,212	1,212	0	0	0	0	0 0	0	0	0
27	of which motor vehicle loans	2,172	2,172	41	41	41	0				0
28	Local governments financing	1,503	1	0	0	0	0	0 0	0	0	0
29 30	Housing financing Other local governments financing	0 1,503	0 1	0 0	0 0	0 0	0 0	0 0 0 0	0 0	0 0	0 0
31	Collateral obtained by taking possession: residential and commercial immovable properties	918	918	0	0	0	0	0 0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	62,439
33	Financial and non-financial corporations	43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	31,228
35	Loans and advances	31,072
36	of which loans collateralised by commercial immovable property	4,688

37	of which building renovation loans	0
38	Debt securities	32
39	Equity instruments	124
40	Non-EU country counterparties not subject to NFRD disclosure obligations	12,315
41	Loans and advances	12,314
42	Debt securities	0
43	Equity instruments	1
44	Derivatives	2,395
45	On demand interbank loans	566
46	Cash and cash-related assets	711
47	Other assets (e.g. goodwill, commodities, etc.)	15,224
48	Total GAR assets	187,387
49	Assets not covered for GAR calculation	55,383
50	Central governments and supranational issuers	35,379
51	Central banks exposure	17,106
52	Trading book	2,898
53	Total assets	242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	756	132	7	1	0	5	2	0	0	0	1
55	Assets under management	4,729	1,162	96	0	7	5	19	0	0	0	0
56		Of which debt securities 0	0	0	0	0	0	0	0	0	0	0
57		Of which equity instruments 0	0	0	0	0	0	0	0	0	0	0

			a	o p	q	r	s	t	u	v		w	x	z		aa
			Disclosure reference date 31/12/2024
			Circular Economy (CE)					Pollution (PPC)					Biodiversity and ecosystems (BIO)
				Of which towards taxonomy relevant sectors		(Taxonomy-eligible)	Of which towards taxonomy relevant sectors (Taxonomy-eligible)				Of which towards taxonomy relevant sectors (Taxonomy-eligible)
in million euros		Total gross carrying			Of which environmentally sustainable	(Taxonomy-aligned)			Of which environmentally sustainable	(Taxonomy-aligned)			Of which environmentally sustainable		(Taxonomy-aligned)
		amount			Of which	Of which			Of which	Of which				Of which		Of which
					specialised lending	adaptation			specialised lending	adaptation				specialised lending	adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	12				61				93
2	Financial corporations	14,675	0				0				0
3	Credit institutions	13,298	0				0				0
4	Loans and advances	11,061	0				0				0
5	Debt securities, including UoP	2,225	0				0				0
6	Equity instruments	11	0				0				0
7	Other financial corporations	1,378	0				0				0
8	of which investment firms	1,309	0				0				0
9	Loans and advances	1,151	0				0				0
10	Debt securities, including UoP	48	0				0				0
11	Equity instruments	110	0				0				0
12	of which management companies	0	0				0				0
13	Loans and advances	0	0				0				0
14	Debt securities, including UoP	0	0				0				0
15	Equity instruments	0	0				0				0
16	of which insurance undertakings	68	0				0				0
17	Loans and advances	43	0				0				0
18	Debt securities, including UoP	0	0				0				0

19	Equity instruments	25	0	0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	12	61	93
21	Loans and advances	14,997	12	29	93
22	Debt securities, including UoP	259	0	32	0
23	Equity instruments	0	0	0	0
24	Households	92,597	0	0	0
25	of which loans collateralised by residential immovable property	78,458	0	0	0
26	of which building renovation loans	1,212	0	0	0
27	of which motor vehicle loans	2,172	0	0	0
28	Local governments financing	1,503	0	0	0
29	Housing financing	0	0	0	0
30	Other local governments financing	1,503	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	918	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	62,439
33	Financial and non-financial corporations	43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	31,228
35	Loans and advances	31,072
36	of which loans collateralised by commercial immovable property	4,688
37	of which building renovation loans	0
38	Debt securities	32
39	Equity instruments	124
40	Non-EU country counterparties not subject to NFRD disclosure obligations	12,315
41	Loans and advances	12,314
42	Debt securities	0
43	Equity instruments	1
44	Derivatives	2,395
45	On demand interbank loans	566
46	Cash and cash-related assets	711
47	Other assets (e.g. goodwill, commodities, etc.)	15,224
48	Total GAR assets	187,387
49	Assets not covered for GAR calculation	55,383
50	Central governments and supranational issuers	35,379
51	Central banks exposure	17,106
52	Trading book	2,898
53	Total assets	242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	756	4	6	10
55	Assets under management	4,729	2	0	0
56	Of which debt securities 0		0	0	0
57	Of which equity instruments 0		0	0	0

	a	ab	ac	ad	ae	af
			Disclosure reference date 31/12/2024
in million euros					TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	Total gross			Of which towards taxonomy relevant sectors (Taxonomy-eligible)
	carrying				Of which environmentally sustainable (Taxonomy-aligned)
	amount				Of which	Of which
				Of which specialised
				lending	transitional	enabling
GAR - Covered assets in both numerator and denominator

1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	87,641	8,292	7,298	337	353
2	Financial corporations	14,675	2,450	178	0	21	34
3	Credit institutions	13,298	2,241	154	0	21	15
4	Loans and advances	11,061	2,092	144	0	19	13
5	Debt securities, including UoP	2,225	148	10	0	2	2
6	Equity instruments	11	2	0		0	0
7	Other financial corporations	1,378	209	24	0	0	19
8	of which investment firms	1,309	192	22	0	0	19
9	Loans and advances	1,151	190	22	0	0	19
10	Debt securities, including UoP	48	0	0	0	0	0
11	Equity instruments	110	2	0		0	0
12	of which management companies	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0
16	of which insurance undertakings	68	17	1	0	0	0
17	Loans and advances	43	17	1	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0
19	Equity instruments	25	0	0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	3,347	1,183	366	275	319
21	Loans and advances	14,997	3,161	1,123	366	275	260
22	Debt securities, including UoP	259	186	60	0	0	60
23	Equity instruments	0	0	0	0	0	0
24	Households	92,597	81,843	6,931	6,931	41	0
25	of which loans collateralised by residential immovable property	78,458	78,458	6,890	6,890	0	0
26	of which building renovation loans	1,212	1,212	0	0	0	0
27	of which motor vehicle loans	2,172	2,172	41	41	41	0
28	Local governments financing	1,503	1	0	0	0	0
29	Housing financing	0	0	0	0	0	0
30	Other local governments financing	1,503	1	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	918	918	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	62,439
33	Financial and non-financial corporations	43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	31,228
35	Loans and advances	31,072
36	of which loans collateralised by commercial immovable property	4,688
37	of which building renovation loans	0
38	Debt securities	32
39	Equity instruments	124
40	Non-EU country counterparties not subject to NFRD disclosure obligations	12,315
41	Loans and advances	12,314
42	Debt securities	0
43	Equity instruments	1
44	Derivatives	2,395
45	On demand interbank loans	566
46	Cash and cash-related assets	711
47	Other assets (e.g. goodwill, commodities, etc.)	15,224
48	Total GAR assets	187,387
49	Assets not covered for GAR calculation	55,383
50	Central governments and supranational issuers	35,379

51	Central banks exposure		17,106
52	Trading book		2,898
53	Total assets		242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees		756	155	8	1	0	5
55	Assets under management		4,729	1,183	96	0	7	6
56		Of which debt securities 0		0	0	0	0	0
57		Of which equity instruments 0		0	0	0	0	0

		ag	ah	ai	aj	ak	al	am	an	ao	ap	aq	ar as	at
								Disclosure reference date 31/12/2023
							Climate Change Mitigation (CCM)			Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
													Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible)
	in million euros	Total gross									Of which environmentally sustainable		Of which environmentally sustainable
		carrying amount			Of which environmentally sustainable (Taxonomy-aligned)						(Taxonomy-aligned)			(Taxonomy-aligned)
						Of which	Of which			Of which	Of which		Of which	Of which
					Of which specialised					specialised			specialised
					lending	transitional	enabling			lending	adaptation		lending	adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203	86,881	7,558	0	114	233	316	127	0	10
2	Financial corporations	7,684	0	0	0	0	0	0	0	0	0
3	Credit institutions	6,588	0	0	0	0	0	0	0	0	0
4	Loans and advances	5,608	0	0	0	0	0	0	0	0	0
5	Debt securities, including UoP	970	0	0	0	0	0	0	0	0	0
6	Equity instruments	10	0	0		0	0	0	0		0
7	Other financial corporations	1,096	0	0	0	0	0	0	0	0	0
8	of which investment firms	1,064	0	0	0	0	0	0	0	0	0
9	Loans and advances	951	0	0	0	0	0	0	0	0	0
10	Debt securities, including UoP	62	0	0	0	0	0	0	0	0	0
11	Equity instruments	51	0	0		0	0	0	0		0
12	of which management companies	0	0	0	0	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0	0	0		0
16	of which insurance undertakings	32	0	0	0	0	0	0	0	0	0
17	Loans and advances	11	0	0	0	0	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0
19	Equity instruments	21	0	0		0	0	0	0		0
20	Non-financial corporations (subject to NFRD disclosure obligations)	14,829	2,069	910	0	112	233	316	127	0	10
21	Loans and advances	14,638	1,979	845	0	112	169	311	126	0	9
22	Debt securities, including UoP	191	90	65	0	0	64	5	1	0	1
23	Equity instruments	0	0	0	0	0	0	0	0	0	0
24	Households	89,144	84,812	6,648	0	1	0	0	0	0	0
25	of which loans collateralised by residential immovable property	75,576	75,576	6,647	0	0	0	0	0	0	0
26	of which building renovation loans	1,316	1,316	1	0	1	0	0	0	0	0
27	of which motor vehicle loans	1,825	382	0	0	0	0
28	Local governments financing	1,546	0	0	0	0	0	0	0	0	0
29	Housing financing	0	0	0	0	0	0	0	0	0	0
30	Other local governments financing	1,546	0	0	0	0	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	1,268	1,268	89	0	0	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	61,510

33	Financial and non-financial corporations	41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	30,121
35	Loans and advances	29,946
36	of which loans collateralised by commercial immovable property	4,900
37	of which building renovation loans	0
38	Debt securities	63
39	Equity instruments	112
40	Non-EU country counterparties not subject to NFRD disclosure obligations	11,293
41	Loans and advances	11,286
42	Debt securities	0
43	Equity instruments	7
44	Derivatives	2,425
45	On demand interbank loans	693
46	Cash and cash-related assets	726
47	Other assets (e.g. goodwill, commodities, etc.)	16,253
48	Total GAR assets	174,713
49	Assets not covered for GAR calculation	64,649
50	Central governments and supranational issuers	33,219
51	Central banks exposure	28,723
52	Trading book	2,706
53	Total assets	239,362
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	914		507	14	0	0	0	0	0	0	0
55	Assets under management	3,007		79	79	0	0	0	5	5	0	0
56		Of which debt securities 0									0 0 0 0 0 0 0 0	0

57	Of which equity instruments 0	0	0	0	0	0	0	0	0	0

	ag	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bf
						Disclosure reference date 31/12/2023
				Circular Economy (CE)					Pollution (PPC)		Biodiversity and ecosystems (BIO)
				Of which towards taxonomy relevant sectors (Taxonomy-eligible)				Of which towards taxonomy relevant sectors (Taxonomy-eligible)			Of which towards taxonomy relevant sectors	(Taxonomy-eligible)
in million euros	Total gross carrying			Of which environmentally sustainable (Taxonomy-aligned)				Of which environmentally sustainable (Taxonomy-aligned)			Of which environmentally sustainable	(Taxonomy-aligned)
	amount			Of which	Of which			Of which	Of which			Of which	Of which
				specialised lending	adaptation			specialised lending	adaptation			specialised lending	adaptation

GAR - Covered assets in both numerator and denominator

1 Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203
------------------------------------------------------------------------------------------------------	---------

2	Financial corporations	7,684
3	Credit institutions	6,588
4	Loans and advances	5,608
5	Debt securities, including UoP	970
6	Equity instruments	10
7	Other financial corporations	1,096
8	of which investment firms	1,064
9	Loans and advances	951
10	Debt securities, including UoP	62
11	Equity instruments	51
12	of which management companies	0
13	Loans and advances	0
14	Debt securities, including UoP	0

15	Equity instruments	0
16	of which insurance undertakings	32
17	Loans and advances	11
18	Debt securities, including UoP	0
19	Equity instruments	21
20	Non-financial corporations (subject to NFRD disclosure obligations)	14,829
21	Loans and advances	14,638
22	Debt securities, including UoP	191
23	Equity instruments	0
24	Households	89,144
25	of which loans collateralised by residential immovable property	75,576
26	of which building renovation loans	1,316
27	of which motor vehicle loans	1,825
28	Local governments financing	1,546
29	Housing financing	0
30	Other local governments financing	1,546
31	Collateral obtained by taking possession: residential and commercial immovable properties	1,268
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	61,510
33	Financial and non-financial corporations	41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	30,121
35	Loans and advances	29,946
36	of which loans collateralised by commercial immovable property	4,900
37	of which building renovation loans	0
38	Debt securities	63
39	Equity instruments	112
40	Non-EU country counterparties not subject to NFRD disclosure obligations	11,293
41	Loans and advances	11,286
42	Debt securities	0
43	Equity instruments	7
44	Derivatives	2,425
45	On demand interbank loans	693
46	Cash and cash-related assets	726
47	Other assets (e.g. goodwill, commodities, etc.)	16,253
48	Total GAR assets	174,713
49	Assets not covered for GAR calculation	64,649
50	Central governments and supranational issuers	33,219
51	Central banks exposure	28,723
52	Trading book	2,706
53	Total assets	239,362
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	914
55	Assets under management	3,007
56	Of which debt securities 0
57	Of which equity instruments 0

			ag	bg	bh	bi	bj	bk
					Disclosure reference date 31/12/2023
							TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Total gross					Of which towards taxonomy relevant sectors (Taxonomy-eligible)
	in million euros	carrying					Of which environmentally sustainable (Taxonomy-aligned)
		amount					Of which	Of which
						Of which specialised lending	transitional	enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203	87,197	7,685	0	124	233
2	Financial corporations	7,684	0	0	0	0	0
3	Credit institutions	6,588	0	0	0	0	0
4	Loans and advances	5,608	0	0	0	0	0
5	Debt securities, including UoP	970	0	0	0	0	0
6	Equity instruments	10	0	0		0	0
7	Other financial corporations	1,096	0	0	0	0	0
8	of which investment firms	1,064	0	0	0	0	0
9	Loans and advances	951	0	0	0	0	0
10	Debt securities, including UoP	62	0	0	0	0	0
11	Equity instruments	51	0	0		0	0
12	of which management companies	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0
16	of which insurance undertakings	32	0	0	0	0	0
17	Loans and advances	11	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0
19	Equity instruments	21	0	0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	14,829	2,385	1,037	0	123	233
21	Loans and advances	14,638	2,290	971	0	122	169
22	Debt securities, including UoP	191	95	66	0	1	64
23	Equity instruments	0	0	0	0	0	0
24	Households	89,144	84,812	6,648	0	1	0
25	of which loans collateralised by residential immovable property	75,576	75,576	6,647	0	0	0
26	of which building renovation loans	1,316	1,316	1	0	1	0
27	of which motor vehicle loans	1,825	382	0	0	0	0
28	Local governments financing	1,546	0	0	0	0	0
29	Housing financing	0	0	0	0	0	0
30	Other local governments financing	1,546	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	1,268	1,268	89	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	61,510
33	Financial and non-financial corporations	41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	30,121
35	Loans and advances	29,946
36	of which loans collateralised by commercial immovable property	4,900
37	of which building renovation loans	0
38	Debt securities	63
39	Equity instruments	112
40	Non-EU country counterparties not subject to NFRD disclosure obligations	11,293

Loans and advances 11,286

42	Debt securities		0
43	Equity instruments		7
44	Derivatives		2,425
45	On demand interbank loans		693
46	Cash and cash-related assets		726
47	Other assets (e.g. goodwill, commodities, etc.)		16,253
48	Total GAR assets		174,713
49	Assets not covered for GAR calculation		64,649
50	Central governments and supranational issuers		33,219
51	Central banks exposure		28,723
52	Trading book		2,706
53	Total assets		239,362
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees		914	507	14	0	0	0
55	Assets under management		3,007	236	84	0	4	43
56		Of which debt securities 0		0	0	0	0	0
57		Of which equity instruments 0		0	0	0	0	0

Assets used to calculate the GAR in relation to CapEx KPIs

		a	b	c	d	e	f	g	h	i	j	k	l	m n
								Disclosure reference date 31/12/2024
						Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)		Water and Marine Resources (WTR)
													Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible)
in million euros		Total gross carrying amount			Of which environmentally sustainable (Taxonomy-aligned)					Of which environmentally sustainable	(Taxonomy-aligned)			Of which environmentally sustainable (Taxonomy-aligned)
						Of which	Of which			Of which	Of which		Of which	Of which
					Of which specialised lending	transitional	enabling			specialised lending	adaptation		specialised lending	adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	88,324	8,754	7,298	367	506	63	8	0	1	3
2	Financial corporations	14,675	2,445	205	0	28	43	6	2	0	0	0
3	Credit institutions	13,298	2,246	184	0	28	25	6	1	0	0	0
4	Loans and advances	11,061	2,093	171	0	25	22	5	1	0	0	0
5	Debt securities, including UoP	2,225	151	13	0	3	2	1	0	0	0	0
6	Equity instruments	11	2	0		0	0	0	0		0	0
7	Other financial corporations	1,378	199	21	0	0	18	0	0	0	0	0
8	of which investment firms	1,309	182	19	0	0	18	0	0	0	0	0
9	Loans and advances	1,151	175	19	0	0	18	0	0	0	0	0
10	Debt securities, including UoP	48	0	0	0	0	0	0	0	0	0	0
11	Equity instruments	110	7	0		0	0	0	0		0	0
12	of which management companies	0	0	0	0	0	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0	0	0		0	0
16	of which insurance undertakings	68	18	1	0	0	0	0	0	0	0	0
17	Loans and advances	43	18	1	0	0	0	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0
19	Equity instruments	25	0	0		0	0	0	0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	4,035	1,617	366	298	463	57	7	0	1	3
21	Loans and advances	14,997	3,880	1,547	366	298	394	57	7	0	1	3

22	Debt securities, including UoP		259	155	70	0	0	70	0	0	0	0	0
23	Equity instruments		0	0	0	0	0	0	0	0	0	0	0
24	Households		92,597	81,843	6,931	6,931	41	0	0	0	0	0	0
25	of which loans collateralised by residential immovable property		78,458	78,458	6,890	6,890	0	0	0	0	0	0	0
26	of which building renovation loans		1,212	1,212	0	0	0	0	0	0	0	0	0
27	of which motor vehicle loans		2,172	2,172	41	41	41	0					0
28	Local governments financing		1,503	1	0	0	0	0	0	0	0	0	0
29	Housing financing		0	0	0	0	0	0	0	0	0	0	0
30	Other local governments financing		1,503	1	0	0	0	0	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties		918	918	0	0	0	0	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)		62,439	0	0	0	0	0	0	0	0	0	0
33	Financial and non-financial corporations		43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations		31,228
35	Loans and advances		31,072
36	of which loans collateralised by commercial immovable property		4,688
37	of which building renovation loans		0
38	Debt securities		32
39	Equity instruments		124
40	Non-EU country counterparties not subject to NFRD disclosure obligations		12,315
41	Loans and advances		12,314
42	Debt securities		0
43	Equity instruments		1
44	Derivatives		2,395
45	On demand interbank loans		566
46	Cash and cash-related assets		711
47	Other assets (e.g. goodwill, commodities, etc.)		15,224
48	Total GAR assets		187,387
49	Assets not covered for GAR calculation		55,383
50	Central governments and supranational issuers		35,379
51	Central banks exposure		17,106
52	Trading book		2,898
53	Total assets		242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees		756	218	4	1	0	1	1	0	0	0	0
55	Assets under management		4,729	988	66	0	17	13	3	1	0	0	0
56		Of which debt securities 0		0	0	0	0	0	0	0	0	0	0
57		Of which equity instruments 0		0	0	0	0	0	0	0	0	0	0

			a o	p	q	r	s	t		u	v	w	x	z	aa
			Disclosure reference date 31/12/2024
					Circular Economy (CE)		Pollution (PPC)					Biodiversity and ecosystems (BIO)
				Of which towards taxonomy relevant sectors	(Taxonomy-eligible)		Of which towards taxonomy relevant sectors (Taxonomy-eligible)					Of which towards taxonomy relevant sectors (Taxonomy-eligible)
in million euros		Total gross carrying amount			Of which environmentally sustainable (Taxonomy-aligned)					Of which environmentally sustainable (Taxonomy-aligned)			Of which environmentally sustainable		(Taxonomy-aligned)
					Of which	Of which				Of which	Of which			Of which	Of which
					specialised lending	adaptation			specialised	lending	adaptation			specialised lending	adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	43				29					100
2	Financial corporations	14,675	0				0					0
3	Credit institutions	13,298	0				0					0
4	Loans and advances	11,061	0				0					0

5	Debt securities, including UoP	2,225	0	0	0
6	Equity instruments	11	0	0	0
7	Other financial corporations	1,378	0	0	0
8	of which investment firms	1,309	0	0	0
9	Loans and advances	1,151	0	0	0
10	Debt securities, including UoP	48	0	0	0
11	Equity instruments	110	0	0	0
12	of which management companies	0	0	0	0
13	Loans and advances	0	0	0	0
14	Debt securities, including UoP	0	0	0	0
15	Equity instruments	0	0	0	0
16	of which insurance undertakings	68	0	0	0
17	Loans and advances	43	0	0	0
18	Debt securities, including UoP	0	0	0	0
19	Equity instruments	25	0	0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	43	29	100
21	Loans and advances	14,997	43	25	100
22	Debt securities, including UoP	259	0	4	0
23	Equity instruments	0	0	0	0
24	Households	92,597	0	0	0
25	of which loans collateralised by residential immovable property	78,458	0	0	0
26	of which building renovation loans	1,212	0	0	0
27	of which motor vehicle loans	2,172		0	0
28	Local governments financing	1,503	0	0	0
29	Housing financing	0	0	0	0
30	Other local governments financing	1,503	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	918	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	62,439	0	0	0
33	Financial and non-financial corporations	43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	31,228
35	Loans and advances	31,072
36	of which loans collateralised by commercial immovable property	4,688
37	of which building renovation loans	0
38	Debt securities	32
39	Equity instruments	124
40	Non-EU country counterparties not subject to NFRD disclosure obligations	12,315
41	Loans and advances	12,314
42	Debt securities	0
43	Equity instruments	1
44	Derivatives	2,395
45	On demand interbank loans	566
46	Cash and cash-related assets	711
47	Other assets (e.g. goodwill, commodities, etc.)	15,224
48	Total GAR assets	187,387
49	Assets not covered for GAR calculation	55,383
50	Central governments and supranational issuers	35,379
51	Central banks exposure	17,106
52	Trading book	2,898
53	Total assets	242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations

54	Financial guarantees	756	4	5	11
55	Assets under management	4,729	2	0	0
56	Of which debt securities 0		0	0	0
57	Of which equity instruments 0		0	0	0

			a	ab	ac	ad	ae	af
					Disclosure reference date 31/12/2024
							TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	in million euros						Of which towards taxonomy relevant sectors (Taxonomy-eligible)
			Total gross				Of which environmentally sustainable (Taxonomy-aligned)
		carrying amount					Of which	Of which
					Of which specialised	lending
	GAR - Covered assets in both numerator and denominator						transitional	enabling
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	124,030	88,562	8,762	7,298	367	507
2	Financial corporations	14,675	2,451	207	0	28	43
3	Credit institutions	13,298	2,252	186	0	28	25
4	Loans and advances	11,061	2,098	172	0	25	22
5	Debt securities, including UoP	2,225	152	13	0	3	2
6	Equity instruments	11	2	0		0	0
7	Other financial corporations	1,378	200	21	0	0	18
8	of which investment firms	1,309	182	19	0	0	18
9	Loans and advances	1,151	175	19	0	0	18
10	Debt securities, including UoP	48	0	0	0	0	0
11	Equity instruments	110	7	0		0	0
12	of which management companies	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0
16	of which insurance undertakings	68	18	1	0	0	0
17	Loans and advances	43	18	1	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0
19	Equity instruments	25	0	0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	15,256	4,267	1,624	366	298	464
21	Loans and advances	14,997	4,107	1,554	366	298	394
22	Debt securities, including UoP	259	159	70	0	0	70
23	Equity instruments	0	0	0	0	0	0
24	Households	92,597	81,843	6,931	6,931	41	0
25	of which loans collateralised by residential immovable property	78,458	78,458	6,890	6,890	0	0
26	of which building renovation loans	1,212	1,212	0	0	0	0
27	of which motor vehicle loans	2,172	2,172	41	41	41	0
28	Local governments financing	1,503	1	0	0	0	0
29	Housing financing	0	0	0	0	0	0
30	Other local governments financing	1,503	1	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	918	918	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	62,439	0	0	0	0	0

33	Financial and non-financial corporations		43,543
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations		31,228
35	Loans and advances		31,072
36	of which loans collateralised by commercial immovable property		4,688
37	of which building renovation loans		0
38	Debt securities		32
39	Equity instruments		124
40	Non-EU country counterparties not subject to NFRD disclosure obligations		12,315
41	Loans and advances		12,314
42	Debt securities		0
43	Equity instruments		1
44	Derivatives		2,395
45	On demand interbank loans		566
46	Cash and cash-related assets		711
47	Other assets (e.g. goodwill, commodities, etc.)		15,224
48	Total GAR assets		187,387
49	Assets not covered for GAR calculation		55,383
50	Central governments and supranational issuers		35,379
51	Central banks exposure		17,106
52	Trading book		2,898
53	Total assets		242,770
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees		756	239	4	1	0	2
55	Assets under management		4,729	993	66	0	17	13
56		Of which debt securities 0		0	0	0	0	0
57		Of which equity instruments 0		0	0	0	0		0

		ag	ah	ai	aj	ak	al	am	an	ao	ap	aq	ar	as at
								Disclosure reference date 31/12/2023
						Climate Change Mitigation (CCM)					Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
in million euros													Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which towards taxonomy relevant sectors (Taxonomy-eligible)
		Total gross carrying amount			Of which environmentally sustainable (Taxonomy-aligned)						Of which environmentally sustainable (Taxonomy-aligned)	Of which environmentally sustainable (Taxonomy-aligned)
						Of which	Of which			Of which	Of which		Of which	Of which
					Of which specialised lending	transitional	enabling			specialised lending	adaptation		specialised	lending adaptation
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203	87,160	7,496	0	114	382	292	121 0		7
2	Financial corporations	7,684	0	0	0	0	0	0 0	0		0
3	Credit institutions	6,588	0	0	0	0	0	0 0	0		0
4	Loans and advances	5,608	0	0	0	0	0	0 0	0		0
5	Debt securities, including UoP	970	0	0	0	0	0	0 0	0		0
6	Equity instruments	10	0	0	0	0	0	0 0	0		0
7	Other financial corporations	1,096	0	0	0	0	0	0 0	0		0
8	of which investment firms	1,001	0	0	0	0	0	0 0	0		0
9	Loans and advances	889	0	0	0	0	0	0 0	0		0
10	Debt securities, including UoP	62	0	0	0	0	0	0 0	0		0
11	Equity instruments	51	0	0		0	0	0 0	0		0

12	of which management companies		0	0	0	0	0	0	0	0	0	0
13	Loans and advances		0	0	0	0	0	0	0	0	0	0
14	Debt securities, including UoP		0	0	0	0	0	0	0	0	0	0
15	Equity instruments		0	0	0		0	0	0	0		0
16	of which insurance undertakings		32	0	0	0	0	0	0	0	0	0
17	Loans and advances		11	0	0	0	0	0	0	0	0	0
18	Debt securities, including UoP		0	0	0	0	0	0	0	0	0	0
19	Equity instruments		21	0	0		0	0	0	0		0
20	Non-financial corporations (subject to NFRD disclosure obligations)		14,829	2,348	847	0	113	382	292	121	0	7
21	Loans and advances		14,638	2,240	824	0	113	359	288	120	0	6
22	Debt securities, including UoP		191	108	23	0	0	23	4	1	0	1
23	Equity instruments		0	0	0	0	0	0	0	0	0	0
24	Households		89,144	84,812	6,648	0	1	0	0	0	0	0
25	of which loans collateralised by residential immovable property		75,576	75,576	6,647	0	0	0	0	0	0	0
26	of which building renovation loans		1,316	1,316	1	0	1	0	0	0	0	0
27	of which motor vehicle loans		1,825	382	0	0	0	0
28	Local governments financing		1,546	0	0	0	0	0	0	0	0	0
29	Housing financing		0	0	0	0	0	0	0	0	0	0
30	Other local governments financing		1,546	0	0	0	0	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties		1,268	1,268	89	0	0	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)		61,510	0	0	0	0	0	0	0	0	0
33	Financial and non-financial corporations		41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations		30,121
35	Loans and advances		29,946
36	of which loans collateralised by commercial immovable property		4,900
37	of which building renovation loans		0
38	Debt securities		63
39	Equity instruments		112
40	Non-EU country counterparties not subject to NFRD disclosure obligations		11,293
41	Loans and advances		11,286
42	Debt securities		0
43	Equity instruments		7
44	Derivatives		2,425
45	On demand interbank loans		693
46	Cash and cash-related assets		726
47	Other assets (e.g. goodwill, commodities, etc.)		16,253
48	Total GAR assets		174,713
49	Assets not covered for GAR calculation		64,649
50	Central governments and supranational issuers		33,219
51	Central banks exposure		28,723
52	Trading book		2,706
53	Total assets		239,362
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees		914	507	14	0	0	0	0	0	0	0
55	Assets under management		3,007	146	146	0	0	0	8	8	0	0
56		Of which debt securities 0		0	0	0	0	0	0	0	0	0
57		Of which equity instruments 0		0	0	0	0	0	0	0	0	0

		ag	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bf
							Disclosure reference date 31/12/2023
					Circular Economy (CE)					Pollution (PPC)			Biodiversity and ecosystems (BIO)
					Of which towards taxonomy relevant sectors			Of which towards taxonomy relevant sectors					Of which towards taxonomy relevant sectors
					(Taxonomy-eligible)					(Taxonomy-eligible)				(Taxonomy-eligible)
	in million euros	Total gross carrying			Of which environmentally sustainable (Taxonomy-aligned)			Of which environmentally sustainable		(Taxonomy-aligned)			Of which environmentally sustainable	(Taxonomy-aligned)
		amount			Of which				Of which				Of which
						Of which				Of which				Of which
					specialised	adaptation			specialised	adaptation			specialised	adaptation
	GAR - Covered assets in both numerator and denominator				lending				lending				lending
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203
2	Financial corporations	7,684
3	Credit institutions	6,588
4	Loans and advances	5,608
5	Debt securities, including UoP	970
6	Equity instruments	10
7	Other financial corporations	1,096
8	of which investment firms	1,001
9	Loans and advances	889
10	Debt securities, including UoP	62
11	Equity instruments	51
12	of which management companies	0
13	Loans and advances	0
14	Debt securities, including UoP	0
15	Equity instruments	0
16	of which insurance undertakings	32
17	Loans and advances	11
18	Debt securities, including UoP	0
19	Equity instruments	21
20 21	Non-financial corporations (subject to NFRD disclosure obligations) Loans and advances	14,829 14,638
22	Debt securities, including UoP	191
23	Equity instruments	0
24	Households	89,144
25	of which loans collateralised by residential immovable property	75,576
26	of which building renovation loans	1,316
27	of which motor vehicle loans	1,825
28	Local governments financing	1,546
29	Housing financing	0
30	Other local governments financing	1,546
31	Collateral obtained by taking possession: residential and commercial immovable properties	1,268
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	61,510
33	Financial and non-financial corporations	41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	30,121
35	Loans and advances	29,946
36	of which loans collateralised by commercial immovable property	4,900
37	of which building renovation loans	0
38	Debt securities	63
39	Equity instruments	112

40	Non-EU country counterparties not subject to NFRD disclosure obligations	11,293
41	Loans and advances	11,286
42	Debt securities	0
43	Equity instruments	7
44	Derivatives	2,425
45	On demand interbank loans	693
46	Cash and cash-related assets	726
47	Other assets (e.g. goodwill, commodities, etc.)	16,253
48	Total GAR assets	174,713
49	Assets not covered for GAR calculation	64,649
50	Central governments and supranational issuers	33,219
51	Central banks exposure	28,723
52	Trading book	2,706
53	Total assets	239,362
	Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	914
55	Assets under management	3,007
56	Of which debt securities 0
57	Of which equity instruments 0

			ag	bg	bh	bi	bj	bk
			Disclosure reference date 31/12/2023
							TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
							Of which towards taxonomy relevant sectors (Taxonomy-eligible)
	in million euros	Total gross carrying					Of which environmentally sustainable (Taxonomy-aligned)
		amount					Of which	Of which
						Of which specialised lending
	GAR - Covered assets in both numerator and denominator						transitional	enabling
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	113,203	87,453	7,617	0	121	382
2	Financial corporations	7,684	0	0	0	0	0
3	Credit institutions	6,588	0	0	0	0	0
4	Loans and advances	5,608	0	0	0	0	0
5	Debt securities, including UoP	970	0	0	0	0	0
6	Equity instruments	10	0	0		0	0
7	Other financial corporations	1,096	0	0	0	0	0
8	of which investment firms	1,001	0	0	0	0	0
9	Loans and advances	889	0	0	0	0	0
10	Debt securities, including UoP	62	0	0	0	0	0
11	Equity instruments	51	0	0		0	0
12	of which management companies	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0
16	of which insurance undertakings	32	0	0	0	0	0
17	Loans and advances	11	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0
19	Equity instruments	21	0	0		0	0
20	Non-financial corporations (subject to NFRD disclosure obligations)	14,829	2,641	969	0	120	382
21	Loans and advances	14,638	2,528	945	0	119	359

22	Debt securities, including UoP	191	113	24	0	1	23
23	Equity instruments	0	0	0	0	0	0
24	Households	89,144	84,812	6,648	0	1	0
25	of which loans collateralised by residential immovable property	75,576	75,576	6,647	0	0	0
26	of which building renovation loans	1,316	1,316	1	0	1	0
27	of which motor vehicle loans	1,825	382	0	0	0	0
28	Local governments financing	1,546	0	0	0	0	0
29	Housing financing	0	0	0	0	0	0
30	Other local governments financing	1,546	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	1,268	1,268	89	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	61,510	0	0	0	0	0
33	Financial and non-financial corporations	41,414
34	SMEs and NFCs (other than SMEs) not subject to NFRD disclosure obligations	30,121
35	Loans and advances	29,946
36	of which loans collateralised by commercial immovable property	4,900
37	of which building renovation loans	0
38	Debt securities	63
39	Equity instruments	112
40	Non-EU country counterparties not subject to NFRD disclosure obligations	11,293
41	Loans and advances	11,286
42	Debt securities	0
43	Equity instruments	7
44	Derivatives	2,425
45	On demand interbank loans	693
46	Cash and cash-related assets	726
47	Other assets (e.g. goodwill, commodities, etc.)	16,253
48	Total GAR assets	174,713
49	Assets not covered for GAR calculation	64,649
50	Central governments and supranational issuers	33,219
51	Central banks exposure	28,723
52	Trading book	2,706
53	Total assets	239,362
Off-balance sheet exposures - Corporates subject to NFRD disclosure obligations
54	Financial guarantees	914	507	14	0	0	0
55	Assets under management	3,007	350	157	0	6	70
56	Of which debt securities 0		0	0	0	0	0
57	Of which equity instruments 0		0	0	0	0	0

2. Assets of non-financial corporations used to calculate the GAR in relation to turnover and CapEx KPIs, broken down by activity sector

Assets of non-financial corporations used to calculate the GAR in relation to turnover KPIs, broken down by activity sector

			a	b	c	d	e	f	g	h	i	j	k	l	m	n	0	p
					Climate Change Adaptation (CCM)			Climate Change Adaptation (CCA)				Water and Marine Resources (WTR)			Circular Economy (CE)
			Non-financial				Non-financial				Non-financial				Non-financial
				corporations (subject to NFRD disclosure	SMEs and other NFCs			corporations (subject to NFRD disclosure		SMEs and other NFCs		corporations (subject to NFRD disclosure		SMEs and other NFCs	corporations (subject to NFRD disclosure			SMEs and other NFCs
			obligations)		not subject to NFRD		obligations)		not subject to NFRD		obligations)		not subject to NFRD		obligations)		not subject to NFRD
			Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount
		Breakdown by sector - NACE 4 digits level (code and label)	[gross]		[gross]		[gross]		[gross]		[gross]		[gross]		[gross]		[gross]
				Of which environm		Of which environm		Of which environm		Of which environm		Of which environm		Of which environm		Of which environm		Of which environm
			in million	entally sustainab	in million	entally sustainab	in million	entally sustainab	in million	entally sustainab	in million	entally sustainab	in million	entally sustainab	in million	entally sustainab	in million	entally sustainab
			euros	le (CCM)	euros	le (CCM)	euros	le (CCA)	euros	le (CCA)	euros	le (WTR)	euros	le (WTR)	euros	le (CE)	euros	le (CE)
1		111 Growing of cereals (except rice), leguminous crops and oil seeds	4.15	0			-	0			-				-
2		113 Growing of vegetables and melons, roots and tubers	18.28	0			-	0			-				-
3		119 Growing of other nonperennial crops	1.95	0			-	0			-				-
4		122 Growing of tropical and subtropical fruits	0.71	0			-	0			-				-
5		123 Growing of citrus fruits	30.59	0			-	0			-				-
6		124 Growing of pome fruits and stone fruits	1.78	0			-	0			-				-
7		125 Growing of other tree and bush fruits and nuts	8.83	0			-	0			-				-
8		130 Plant propagation	7.15	0			-	0			-				-
9		143 Raising of horses and other equines	0	0			-	0			-				-
10		145 Raising of sheep and goats	2.24	0			-	0			-				-
11		146 Raising of swine/pigs	38.46	0			-	0			-				-
12		147 Raising of poultry	9.7	0			-	0			-				-
13		149 Raising of other animals	2.08	0			-	0			-				-
14		150 Mixed farming	0.34	0			-	0			-				-
15		161 Support activities for crop production	11.71	0			-	0			-				-
16		162 Support activities for animal production	5	0			-	0			-				-
17		210 Silviculture and other forestry activities	3.45	0			-	0			-				-
18 19		220 Logging 311 Marine fishing	0.06 11.23	0 0			- -	0 0			- -				- -
20		321 Marine aquaculture	4.76	0			-	0			-				-
21		610 Extraction of crude petroleum	38.46	0.1			-	0			-				-
22		729 Mining of other nonferrous metal ores	39.5	0.01			-	0			-				-
23		811 Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate	2.02	0			-	0			-				-
24		812 Operation of gravel and sand pits; mining of clays and kaolin	0.08	0			-	0			-				-
25		891 Mining of chemical and fertiliser minerals	0.01	0			-	0			-				-
26		893 Extraction of salt	0	0			-	0			-				-
27		899 Other mining and quarrying n.e.c.	0.15	0			-	0			-				-
28		1011 Processing and preserving of meat	80.1	0			-	0			-				-
29		1012 Processing and preserving of poultry meat	4.31	0			-	0			-				-
30		1013 Production of meat and poultry meat products	95.8	0			-	0			-				-
31		1020 Processing and preserving of fish, crustaceans and molluscs	54.45	0			-	0			-				-
32		1032 Manufacture of fruit and vegetable juice	15.59	0			-	0			-				-
33		1039 Other processing and preserving of fruit and vegetables	9.33	0			-	0			-				-
34		1041 Manufacture of oils and fats	1.24	0			-	0			-				-
35		1051 Operation of dairies and cheese making	77.83	0			-	0			-				-
36		1052 Manufacture of ice cream	1.22	0			-	0			-				-
37		1061 Manufacture of grain mill products	3.05	0			-	0			-				-
38		1071 Manufacture of bread; manufacture of fresh pastry goods and cakes	80.76	0			-	0			-				-
39		1072 Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes	1.08	0			-	0			-				-

40	1073 Manufacture of macaroni, noodles, couscous and similar farinaceous products	29.25	0	-	0	-	-
41	1082 Manufacture of cocoa, chocolate and sugar confectionery	77.3	0	-	0	-	-
42	1084 Manufacture of condiments and seasonings	7.32	0	-	0	-	-
43	1085 Manufacture of prepared meals and dishes	1.79	0	-	0	-	-
44	1086 Manufacture of homogenised food preparations and dietetic food	1.98	0	-	0	-	-
45	1089 Manufacture of other food products n.e.c.	35.1	0	-	0	-	-
46	1091 Manufacture of prepared feeds for farm animals	91.42	0	-	0	-	-
47	1092 Manufacture of prepared pet foods	8.41	0	-	0	-	-
48	1101 Distilling, rectifying and blending of spirits	0.45	0	-	0	-	-
49	1102 Manufacture of wine from grape	88.09	0	-	0	-	-
50	1105 Manufacture of beer	55.94	0	-	0	-	-
51	1106 Manufacture of malt	0	0	-	0	-	-
52	1107 Manufacture of soft drinks; production of mineral waters and other bottled waters	131.01	0	-	0	-	-
53	1310 Preparation and spinning of textile fibres	2.83	0	-	0	-	-
54	1320 Weaving of textiles	3.47	0	-	0	-	-
55	1330 Finishing of textiles	0.42	0	-	0	-	-
56	1391 Manufacture of knitted and crocheted fabrics	0.01	0	-	0	-	-
57	1396 Manufacture of other technical and industrial textiles	0.85	0	-	0	-	-
58	1399 Manufacture of other textiles n.e.c.	0	0	-	0	-	-
59	1412 Manufacture of workwear	0.37	0	-	0	-	-
60	1413 Manufacture of other outerwear	7.56	0	-	0	-	-
61	1419 Manufacture of other wearing apparel and accessories	8.04	0	-	0	-	-
62	1431 Manufacture of knitted and crocheted hosiery	0	0	-	0	-	-
63	1511 Tanning and dressing of leather; dressing and dyeing of fur	5.45	0	-	0	-	-
64	1520 Manufacture of footwear	0.93	0	-	0	-	-
65	1610 Sawmilling and planing of wood	0.13	0	-	0	-	-
66	1621 Manufacture of veneer sheets and woodbased panels	27.36	0	-	0	-	-
67	1623 Manufacture of other builders' carpentry and joinery	7.34	0	-	0	-	-
68	1629 Manufacture of other products of wood; manufacture of articles of cork, straw and plaiting materials	0	0	-	0	-	-
69	1711 Manufacture of pulp	30.89	7.36	-	0	-	-
70	1712 Manufacture of paper and paperboard	47.91	0	-	0	-	-
71	1721 Manufacture of corrugated paper and paperboard and of containers of paper and paperboard	20.04	0	-	0	-	-
72	1722 Manufacture of household and sanitary goods and of toilet requisites	0.01	0	-	0	-	-
73	1723 Manufacture of paper stationery	2.4	0	-	0	-	-
74	1811 Printing of newspapers	0.71	0	-	0	-	-
75	1812 Other printing	0.8	0	-	0	-	-
76	1920 Manufacture of refined petroleum products	123.97	0.03	-	0	-	-
77	2011 Manufacture of industrial gases	0.02	0	-	0	-	-
78	2012 Manufacture of dyes and pigments	1.68	0	-	0	-	-
79	2013 Manufacture of other inorganic basic chemicals	14.78	0	-	0	-	-
80	2014 Manufacture of other organic basic chemicals	0.7	0	-	0	-	-
81	2015 Manufacture of fertilisers and nitrogen compounds	21.44	0.01	-	1.75	-	-
82	2016 Manufacture of plastics in primary forms	8.57	0	-	0	-	-
83	2017 Manufacture of synthetic rubber in primary forms	14.19	0	-	0	-	-
84	2020 Manufacture of pesticides and other agrochemical products	13.79	0	-	0	-	-
85	2030 Manufacture of paints, varnishes and similar coatings, printing ink and mastics	17.85	0	-	0	-	-
86	2041 Manufacture of soap and detergents, cleaning and polishing preparations	5.97	0	-	0	-	-
87	2042 Manufacture of perfumes and toilet preparations	2.39	0	-	0	-	-
88	2051 Manufacture of explosives	72.03	0	-	0	-	-
89	2059 Manufacture of other chemical products n.e.c.	4.39	0	-	0	-	-
90	2110 Manufacture of basic pharmaceutical products	112.87	0	-	0	-	-
91	2120 Manufacture of pharmaceutical preparations	34.79	0	-	0	-	-
92	2211 Manufacture of rubber tyres and tubes; retreading and rebuilding of rubber tyres	10.41	0	-	0	-	-
93	2219 Manufacture of other rubber products	5.6	0	-	0	-	-
94	2221 Manufacture of plastic plates, sheets, tubes and profiles	16.43	0	-	0	-	-
95	2222 Manufacture of plastic packing goods	14.14	0	-	0	-	-

96	2223 Manufacture of builders' ware of plastic	6.09	0	-	0	-	-
97	2229 Manufacture of other plastic products	80.54	0	-	0	-	-
98	2311 Manufacture of flat glass	1.2	0	-	0	-	-
99	2312 Shaping and processing of flat glass	0.6	0	-	0	-	-
100	2313 Manufacture of hollow glass	2.63	0	-	0	-	-
101	2314 Manufacture of glass fibres	0.05	0	-	0	-	-
102	2319 Manufacture and processing of other glass, including technical glassware	2.52	0	-	0	-	-
103	2320 Manufacture of refractory products	2.9	0	-	0	-	-
104	2331 Manufacture of ceramic tiles and flags	53.47	0	-	0	-	-
105	2332 Manufacture of bricks, tiles and construction products, in baked clay	1.11	0	-	0	-	-
106	2342 Manufacture of ceramic sanitary fixtures	44.63	0	-	0	-	-
107	2344 Manufacture of other technical ceramic products	2.15	0	-	0	-	-
108	2349 Manufacture of other ceramic products	4.36	0	-	0	-	-
109	2351 Manufacture of cement	55.16	0.39	-	0	-	-
110	2352 Manufacture of lime and plaster	6.84	0	-	0	-	-
111	2361 Manufacture of concrete products for construction purposes	0.11	0	-	0	-	-
112	2363 Manufacture of ready-mixed concrete	3.78	0	-	0	-	-
113	2364 Manufacture of mortars	0.02	0	-	0	-	-
114	2369 Manufacture of other articles of concrete, plaster and cement	0.12	0	-	0	-	-
115	2370 Cutting, shaping and finishing of stone	8.86	0	-	0	-	-
116	2399 Manufacture of other non-metallic mineral products n.e.c.	5.74	0	-	0	-	-
117	2410 Manufacture of basic iron and steel and of ferroalloys	56.32	7.53	-	0	-	-
118	2420 Manufacture of tubes, pipes, hollow profiles and related fittings, of steel	28.03	0.55	-	0	-	-
119	2431 Cold drawing of bars	0.01	0	-	0	-	-
120	2432 Cold rolling of narrow strip	19.92	0	-	0	-	-
121	2433 Cold forming or folding	0.07	0	-	0	-	-
122	2434 Cold drawing of wire	0.09	0	-	0	-	-
123	2442 Aluminium production	37.59	0	-	0	-	-
124	2445 Other nonferrous metal production	381.3	264.4	-	0	-	-
125	2446 Processing of nuclear fuel	40	0	-	0	-	-
126	2451 Casting of iron	3.56	0	-	0	-	-
127	2452 Casting of steel	10.42	0	-	0	-	-
128	2453 Casting of light metals	4.47	0	-	0	-	-
129	2454 Casting of other nonferrous metals	0.41	0	-	0	-	-
130	2511 Manufacture of metal structures and parts of structures	63.78	0	-	0	-	-
131	2512 Manufacture of doors and windows of metal	0.86	0	-	0	-	-
132	2521 Manufacture of central heating radiators and boilers	0	0	-	0	-	-
133	2529 Manufacture of other tanks, reservoirs and containers of metal	1.7	0	-	0	-	-
134	2540 Manufacture of weapons and ammunition	2.08	0	-	0	-	-
135	2550 Forging, pressing, stamping and rollforming of metal; powder metallurgy	78	0.19	-	0	-	-
136	2561 Treatment and coating of metals	9.43	0	-	0	-	-
137	2562 Machining	4.65	0	-	0	-	-
138	2571 Manufacture of cutlery	0.03	0	-	0	-	-
139	2572 Manufacture of locks and hinges	1.84	0	-	0	-	-
140	2592 Manufacture of light metal packaging	14.69	0	-	0	-	-
141	2593 Manufacture of wire products, chain and springs	3.58	0	-	0	-	-
142	2594 Manufacture of fasteners and screw machine products	1.63	0	-	0	-	-
143	2599 Manufacture of other fabricated metal products n.e.c.	16.51	0	-	0	-	-
144	2611 Manufacture of electronic components	4.65	0	-	0	-	-
145	2612 Manufacture of loaded electronic boards	0.7	0	-	0	-	-
146	2620 Repair of computers and peripheral equipment	0	0	-	0	-	-
147	2630 Manufacture of communication equipment	0	0	-	0	-	-
148	2651 Manufacture of instruments and appliances for measuring, testing and navigation	0.07	0	-	0	-	-
149	2652 Manufacture of watches and clocks	3.94	0	-	0	-	-
150	2660 Manufacture of irradiation, electromedical and electrotherapeutic equipment	3.75	0	-	0	-	-
151	2670 Manufacture of optical instruments and photographic equipment	0.04	0	-	0	-	-

152	2711 Manufacture of electric motors, generators and transformers	95.29	0	-	0	-	-
153	2712 Manufacture of electricity distribution and control apparatus	3.71	0	-	0	-	-
154	2720 Manufacture of batteries and accumulators	0.02	0	-	0	-	-
155	2732 Manufacture of other electronic and electric wires and cables	11.14	0	-	0	-	-
156	2740 Manufacture of electric lighting equipment	0.01	0	-	0	-	-
157	2751 Manufacture of electric domestic appliances	1.48	0	-	0	-	-
158	2790 Manufacture of other electrical equipment	14.86	0.11	-	0	-	-
159	2811 Manufacture of engines and turbines, except aircraft, vehicle and cycle engines	0.04	0	-	0	-	-
160	2813 Manufacture of other pumps and compressors	0	0	-	0	-	-
161	2815 Manufacture of bearings, gears, gearing and driving elements	6.68	0	-	0	-	-
162	2822 Manufacture of lifting and handling equipment	13.63	0	-	0	-	-
163	2825 Manufacture of nondomestic cooling and ventilation equipment	78	0	-	0	-	-
164	2829 Manufacture of other general purpose machinery n.e.c.	3.98	0	-	0	-	-
165	2830 Manufacture of agricultural and forestry machinery	1.99	0	-	0	-	-
166	2841 Manufacture of metal forming machinery	17.83	0	-	0	-	-
167	2849 Manufacture of other machine tools	1.89	0	-	0	-	-
168	2891 Manufacture of machinery for metallurgy	0.26	0	-	0	-	-
169	2892 Manufacture of machinery for mining, quarrying and construction	4.96	0	-	0	-	-
170	2893 Manufacture of machinery for food, beverage and tobacco processing	0	0	-	0	-	-
171	2894 Manufacture of machinery for textile, apparel and leather production	0.96	0	-	0	-	-
172	2895 Manufacture of machinery for paper and paperboard production	0.19	0	-	0	-	-
173	2896 Manufacture of plastics and rubber machinery	5.35	0	-	0	-	-
174	2899 Manufacture of other special purpose machinery n.e.c.	7.98	0	-	0	-	-
175	2910 Manufacture of motor vehicles	43.72	0	-	0	-	-
176	2920 Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and semitrailers	2.35	0	-	0	-	-
177	2931 Manufacture of electrical and electronic equipment for motor vehicles	1.36	0	-	0	-	-
178	2932 Manufacture of other parts and accessories for motor vehicles	329.51	0.47	-	0	-	-
179	3011 Building of ships and floating structures	4.21	0.85	-	0	-	-
180	3020 Manufacture of railway locomotives and rolling stock	46.29	16.05	-	0	-	-
181	3030 Manufacture of air and spacecraft and related machinery	72.53	0	-	0	-	-
182	3040 Manufacture of military fighting vehicles	0.1	0	-	0	-	-
183	3101 Manufacture of office and shop furniture	0.98	0	-	0	-	-
184	3102 Manufacture of kitchen furniture	1.55	0	-	0	-	-
185	3103 Manufacture of mattresses	2.3	0	-	0	-	-
186	3109 Manufacture of other furniture	0.04	0	-	0	-	-
187	3250 Manufacture of medical and dental instruments and supplies	5.87	0	-	0	-	-
188	3299 Other manufacturing n.e.c.	4.31	0	-	0	-	-
189	3312 Repair of machinery	0.43	0	-	0	-	-
190	3314 Repair of electrical equipment	0	0	-	0	-	-
191	3317 Repair and maintenance of other transport equipment	0.49	0.01	-	0	-	-
192	3319 Repair of other equipment	0	0	-	0	-	-
193	3320 Installation of industrial machinery and equipment	4.39	0.14	-	0	-	-
194	3511 Production of electricity	461.94	101.11	-	0	-	-
195	3512 Transmission of electricity	11.39	0	-	0	-	-
196	3513 Distribution of electricity	260.39	39.51	-	0	-	-
197	3514 Trade of electricity	12.04	0.51	-	0	-	-
198	3521 Manufacture of gas	104.12	6.25	-	0	-	-
199	3522 Distribution of gaseous fuels through mains	251.37	28	-	0	-	-
200	3523 Trade of gas through mains	5.8	0	-	0	-	-
201	3600 Water collection, treatment and supply	121.24	11.86	-	0	-	-
202	3700 Sewerage	11.22	4.81	-	0	-	-
203	3811 Collection of non-hazardous waste	22.27	0.01	-	0	-	-
204	3821 Treatment and disposal of non-hazardous waste	47.48	0	-	0	-	-
205	3822 Treatment and disposal of hazardous waste	0.1	0	-	0	-	-
206	3831 Dismantling of wrecks	15.37	0	-	0	-	-
207	3832 Recovery of sorted materials	6.5	4.66	-	0	-	-

208	3900 Remediation activities and other waste management services	0.73	0	-	0	-	-
209	4110 Development of building projects	105.6	0	-	0	-	-
210	4120 Construction of residential and non-residential buildings	65.79	0	-	0	-	-
211	4211 Construction of roads and motorways	89.95	5.32	-	0.02	-	-
212	4212 Construction of railways and underground railways	322.43	157.01	-	0	-	-
213	4213 Construction of bridges and tunnels	31.21	11.72	-	0	-	-
214	4222 Construction of utility projects for electricity and telecommunications	11.16	0	-	0	-	-
215	4291 Construction of water projects	0.43	0	-	0	-	-
216	4299 Construction of other civil engineering projects n.e.c.	196.41	23.21	-	0.09	-	-
217	4311 Demolition	0	0	-	0	-	-
218	4312 Site preparation	0	0	-	0	-	-
219	4321 Electrical installation	198.18	0.04	-	0	-	-
220	4322 Plumbing, heat and airconditioning installation	44.4	0	-	0	-	-
221	4329 Other construction installation	0.1	0	-	0	-	-
222	4331 Plastering	0	0	-	0	-	-
223	4333 Floor and wall covering	1.85	0	-	0	-	-
224	4334 Painting and glazing	0.07	0	-	0	-	-
225	4339 Other building completion and finishing	0.29	0	-	0	-	-
226	4399 Other specialised construction activities n.e.c.	104.79	11.6	-	0.01	-	-
227	4511 Sale of cars and light motor vehicles	36.05	0	-	0	-	-
228	4519 Sale of other motor vehicles	3.43	0	-	0	-	-
229	4520 Maintenance and repair of motor vehicles	0.14	0	-	0	-	-
230	4531 Wholesale trade of motor vehicle parts and accessories	1.61	0	-	0	-	-
231	4532 Retail trade of motor vehicle parts and accessories	1.37	0	-	0	-	-
232	4540 Sale, maintenance and repair of motorcycles and related parts and accessories	0.59	0.32	-	0	-	-
233	4611 Agents involved in the sale of agricultural raw materials, live animals, textile raw materials and semifinished goods	0.2	0	-	0	-	-
234	4612 Agents involved in the sale of fuels, ores, metals and industrial chemicals	1.95	0	-	0	-	-
235	4613 Agents involved in the sale of timber and building materials	2.16	0	-	0	-	-
236	4614 Agents involved in the sale of machinery, industrial equipment, ships and aircraft	4.78	0	-	0	-	-
237	4615 Agents involved in the sale of furniture, household goods, hardware and ironmongery	6.5	0	-	0	-	-
238	4617 Agents involved in the sale of food, beverages and tobacco	6.62	0	-	0	-	-
239	4619 Agents involved in the sale of a variety of goods	12.49	0	-	0	-	-
240	4621 Wholesale of grain, unmanufactured tobacco, seeds and animal feeds	42.95	0	-	0	-	-
241	4623 Wholesale of live animals	1.49	0	-	0	-	-
242	4624 Wholesale of hides, skins and leather	3.14	0	-	0	-	-
243	4631 Wholesale of fruit and vegetables	51.83	0	-	0	-	-
244	4632 Wholesale of meat and meat products	30.52	0	-	0	-	-
245	4633 Wholesale of dairy products, eggs and edible oils and fats	47.67	0	-	0	-	-
246	4634 Wholesale of beverages	14.35	0	-	0	-	-
247	4635 Wholesale of tobacco products	0	0	-	0	-	-
248	4636 Wholesale of sugar and chocolate and sugar confectionery	3.46	0	-	0	-	-
249	4637 Wholesale of coffee, tea, cocoa and spices	0.94	0	-	0	-	-
250	4638 Wholesale of other food, including fish, crustaceans and molluscs	45.85	0	-	0	-	-
251	4639 Nonspecialised wholesale of food, beverages and tobacco	78.74	0	-	0	-	-
252	4641 Wholesale of textiles	0.34	0	-	0	-	-
253	4642 Wholesale of clothing and footwear	43.72	0	-	0	-	-
254	4643 Wholesale of electrical household appliances	29.75	0	-	0	-	-
255	4644 Wholesale of china and glassware and cleaning materials	1.59	0	-	0	-	-
256	4645 Wholesale of perfume and cosmetics	324.42	0	-	0	-	-
257	4646 Wholesale of pharmaceutical goods	93.54	0	-	0	-	-
258	4648 Wholesale of watches and jewellery	0.08	0	-	0	-	-
259	4649 Wholesale of other household goods	4.71	0	-	0	-	-
260	4651 Wholesale of computers, computer peripheral equipment and software	12.39	0	-	0	-	-
261	4652 Wholesale of electronic and telecommunications equipment and parts	3.34	0	-	0	-	-
262	4661 Wholesale of agricultural machinery, equipment and supplies	0.05	0	-	0	-	-
263	4662 Wholesale of machine tools	0.13	0	-	0	-	-

264	4663 Wholesale of mining, construction and civil engineering machinery	0.18	0	-	0	-	-
265	4665 Wholesale of office furniture	6.16	0	-	0	-	-
266	4666 Wholesale of other office machinery and equipment	9.93	0	-	0	-	-
267	4669 Wholesale of other machinery and equipment	35.06	0	-	0	-	-
268	4671 Wholesale of solid, liquid and gaseous fuels and related products	14.29	0	-	0	-	-
269	4672 Wholesale of metals and metal ores	120.84	3.18	-	0	-	-
270	4673 Wholesale of wood, construction materials and sanitary equipment	114.93	0	-	0	-	-
271	4674 Wholesale of hardware, plumbing and heating equipment and supplies	47.59	0	-	0	-	-
272	4675 Wholesale of chemical products	33.26	0	-	0	-	-
273	4676 Wholesale of other intermediate products	52.03	0	-	0	-	-
274	4677 Wholesale of waste and scrap	0.83	0	-	0	-	-
275	4690 Nonspecialised wholesale trade	16.77	0	-	0	-	-
276	4711 Retail sale in nonspecialised stores with food, beverages or tobacco predominating	433.56	0	-	0	-	-
277	4719 Other retail sale in nonspecialised stores	163.82	0.03	-	0	-	-
278	4721 Retail sale of fruit and vegetables in specialised stores	15.73	0	-	0	-	-
279	4722 Retail sale of meat and meat products in specialised stores	6.61	0	-	0	-	-
280	4724 Retail sale of bread, cakes, flour confectionery and sugar confectionery in specialised stores	0.32	0	-	0	-	-
281	4729 Other retail sale of food in specialised stores	29.34	0	-	0	-	-
282	4730 Retail sale of automotive fuel in specialised stores	47.17	0.04	-	0	-	-
283	4741 Retail sale of computers, peripheral units and software in specialised stores	0.69	0	-	0	-	-
284	4742 Retail sale of telecommunications equipment in specialised stores	7.44	0	-	0	-	-
285	4751 Retail sale of textiles in specialised stores	0	0	-	0	-	-
286	4752 Retail sale of hardware, paints and glass in specialised stores	36.63	0	-	0	-	-
287	4759 Retail sale of furniture, lighting equipment and other household articles in specialised stores	18.58	0	-	0	-	-
288	4761 Retail sale of books in specialised stores	0.15	0	-	0	-	-
289	4764 Retail sale of sporting equipment in specialised stores	1.71	0	-	0	-	-
290	4765 Retail sale of games and toys in specialised stores	0.03	0	-	0	-	-
291	4771 Retail sale of clothing in specialised stores	107.04	0	-	0	-	-
292	4772 Retail sale of footwear and leather goods in specialised stores	1.96	0	-	0	-	-
293	4773 Dispensing chemist in specialised stores	0.05	0	-	0	-	-
294	4774 Retail sale of medical and orthopaedic goods in specialised stores	0.09	0	-	0	-	-
295	4775 Retail sale of cosmetic and toilet articles in specialised stores	35.39	0	-	0	-	-
296	4776 Retail sale of flowers, plants, seeds, fertilisers, pet animals and pet food in specialised stores	0.93	0	-	0	-	-
297	4777 Retail sale of watches and jewellery in specialised stores	0.68	0	-	0	-	-
298	4778 Other retail sale of new goods in specialised stores	100.63	0.01	-	0	-	-
299	4781 Retail sale via stalls and markets of food, beverages and tobacco products	3.46	0	-	0	-	-
300	4791 Retail sale via mail order houses or via Internet	2.12	0	-	0	-	-
301	4799 Other retail sale not in stores, stalls or markets	3.99	0	-	0	-	-
302	4910 Passenger rail transport, interurban	405	5.7	-	0	-	-
303	4920 Freight rail transport	0.01	0	-	0	-	-
304	4931 Urban and suburban passenger land transport	156.45	0	-	0	-	-
305	4932 Taxi operation	0.6	0	-	0	-	-
306	4939 Other passenger land transport n.e.c.	37.58	0	-	0	-	-
307	4941 Freight transport by road	67.63	0	-	0	-	-
308	4950 Transport via pipeline	26.07	0	-	0	-	-
309	5010 Sea and coastal passenger water transport	19.72	0	-	0	-	-
310	5020 Sea and coastal freight water transport	47.19	0	-	0	-	-
311	5110 Passenger air transport	5.42	0	-	0	-	-
312	5121 Freight air transport	0	0	-	0	-	-
313	5210 Warehousing and storage	7.63	0	-	0	-	-
314	5221 Service activities incidental to land transportation	281.1	6.63	-	0.03	-	-
315	5222 Service activities incidental to water transportation	109.35	0	-	0	-	-
316	5223 Service activities incidental to air transportation	360.73	126.06	-	0	-	-
317	5224 Cargo handling	0.29	0	-	0	-	-
318	5229 Other transportation support activities	36.44	0	-	0	-	-
319	5310 Postal activities under universal service obligation	48.1	0	-	0	-	-

320	5320 Other postal and courier activities	12.57	0	-	0	-	-
321	5510 Hotels and similar accommodation	676.74	0	-	0	-	-
322	5520 Holiday and other short-stay accommodation	22.86	0	-	0	-	-
323	5530 Camping grounds, recreational vehicle parks and trailer parks	1.25	0	-	0	-	-
324	5590 Other accommodation	1.02	0	-	0	-	-
325	5610 Restaurants and mobile food service activities	92.67	0	-	0	-	-
326	5621 Event catering activities	0.24	0	-	0	-	-
327	5629 Other food service activities	0.94	0	-	0	-	-
328	5630 Beverage serving activities	2.93	0	-	0	-	-
329	5811 Book publishing	1.39	0	-	0	-	-
330	5813 Publishing of newspapers	3.93	0	-	0	-	-
331	5819 Other publishing activities	5.06	0	-	0	-	-
332	5821 Publishing of computer games	20.1	0	-	0	-	-
333	5829 Other software publishing	0.43	0	-	0	-	-
334	5912 Motion picture, video and television programme postproduction activities	9.5	0	-	0	-	-
335	6010 Radio broadcasting	0.01	0	-	0	-	-
336	6020 Television programming and broadcasting activities	8.44	0	-	0	-	-
337	6110 Wired telecommunications activities	289.91	1.61	-	0	-	-
338	6120 Wireless telecommunications activities	0.23	0	-	0	-	-
339	6130 Satellite telecommunications activities	0.09	0	-	0	-	-
340	6190 Other telecommunications activities	401.62	1.19	-	1.15	-	-
341	6201 Computer programming activities	8.19	0.01	-	0	-	-
342	6202 Computer consultancy activities	27.35	0	-	0.55	-	-
343	6203 Computer facilities management activities	1.34	0	-	0	-	-
344	6209 Other information technology and computer service activities	19.1	0	-	0	-	-
345	6311 Data processing, hosting and related activities	3.3	0	-	0	-	-
346	6312 Web portals	0.17	0	-	0	-	-
347	6391 News agency activities	0	0	-	0	-	-
348	6399 Other information service activities n.e.c.	0	0	-	0	-	-
349	6420 Activities of holding companies	765.71	0.01	-	0	-	-
350	6499 Other financial service activities, except insurance and pension funding n.e.c.	149.29	53.08	-	0.01	-	-
351	6612 Security and commodity contracts brokerage	0.2	0	-	0	-	-
352	6619 Other activities auxiliary to financial services, except insurance and pension funding	332.46	266.14	-	0	-	-
353	6622 Activities of insurance agents and brokers	0.84	0.01	-	0	-	-
354	6810 Buying and selling of own real estate	74.96	0	-	0	-	-
355	6820 Renting and operating of own or leased real estate	347.72	0.91	-	0	-	-
356	6831 Real estate agencies	0.95	0	-	0	-	-
357	6832 Management of real estate on a fee or contract basis	38.6	0.01	-	0.22	-	-
358	6910 Legal activities	7.59	0	-	0	-	-
359	6920 Accounting, bookkeeping and auditing activities; tax consultancy	21.83	0	-	0	-	-
360	7010 Activities of head offices	256.85	5.61	-	0.14	-	-
361	7021 Public relations and communication activities	0	0	-	0	-	-
362	7022 Business and other management consultancy activities	70.45	0.01	-	0	-	-
363	7111 Architectural activities	0.25	0	-	0	-	-
364	7112 Engineering activities and related technical consultancy	104.83	0.1	-	0	-	-
365	7120 Technical testing and analysis	15.45	0	-	0	-	-
366	7219 Other research and experimental development on natural sciences and engineering	2.01	0	-	0	-	-
367	7220 Research and experimental development on social sciences and humanities	0.79	0	-	0	-	-
368	7311 Advertising agencies	16.72	0	-	0	-	-
369	7312 Media representation	0	0	-	0	-	-
370	7320 Market research and public opinion polling	1.5	0	-	0	-	-
371	7410 Specialised design activities	0.01	0	-	0	-	-
372	7420 Photographic activities	0.11	0.02	-	0	-	-
373	7490 Other professional, scientific and technical activities n.e.c.	51.56	2.21	-	0.02	-	-
374	7500 Veterinary activities	3.26	0	-	0	-	-
375	7711 Renting and leasing of cars and light motor vehicles	24.79	0	-	0	-	-

376	7712 Renting and leasing of trucks	3.68	0	-	0	-	-
377	7732 Renting and leasing of construction and civil engineering machinery and equipment	12.91	0	-	0	-	-
378	7734 Renting and leasing of water transport equipment	1.21	0	-	0	-	-
379	7735 Renting and leasing of air transport equipment	57.81	0	-	0	-	-
380	7739 Renting and leasing of other machinery, equipment and tangible goods n.e.c.	84.58	0.03	-	0.54	-	-
381	7740 Leasing of intellectual property and similar products, except copyrighted works	0.74	0	-	0	-	-
382	7810 Activities of employment placement agencies	0.02	0	-	0	-	-
383	7820 Temporary employment agency activities	11.19	0	-	0	-	-
384	7830 Other human resources provision	0.01	0	-	0	-	-
385	7911 Travel agency activities	11.91	0	-	0	-	-
386	7912 Tour operator activities	7.15	0	-	0	-	-
387	7990 Other reservation service and related activities	0.01	0	-	0	-	-
388	8010 Private security activities	4.65	0	-	0	-	-
389	8020 Security systems service activities	5.19	0	-	0	-	-
390	8110 Combined facilities support activities	12.86	0	-	0	-	-
391	8121 General cleaning of buildings	3.74	0.24	-	0	-	-
392	8122 Other building and industrial cleaning activities	11.81	0	-	0	-	-
393	8129 Other cleaning activities	4.86	0	-	0	-	-
394	8130 Landscape service activities	0.08	0	-	0	-	-
395	8211 Combined office administrative service activities	1.61	0	-	0	-	-
396	8219 Photocopying, document preparation and other specialised office support activities	0.42	0	-	0	-	-
397	8220 Activities of call centres	0.84	0	-	0	-	-
398	8230 Organisation of conventions and trade shows	3.09	0	-	0	-	-
399	8291 Activities of collection agencies and credit bureaus	2.74	0	-	0	-	-
400	8292 Packaging activities	0.02	0	-	0	-	-
401	8299 Other business support service activities n.e.c.	3.91	0	-	0	-	-
402	8411 General public administration activities	573.54	0.94	-	0	-	-
403	8412 Regulation of the activities of providing health care, education, cultural services and other social services, excluding social security 0		0	-	0	-	-
404	8413 Regulation of and contribution to more efficient operation of businesses	0	0	-	0	-	-
405	8520 Primary education	0.04	0	-	0	-	-
406	8531 General secondary education	0.2	0	-	0	-	-
407	8532 Technical and vocational secondary education	30.01	0	-	0	-	-
408	8541 Postsecondary non	10.81	0	-	0	-	-
409	8552 Cultural education	0.91	0	-	0	-	-
410	8559 Other education n.e.c.	8.83	0	-	0	-	-
411	8560 Educational support activities	2.48	0	-	0	-	-
412	8610 Hospital activities	73.86	0	-	0	-	-
413	8621 General medical practice activities	10.27	0.01	-	0	-	-
414	8622 Specialist medical practice activities	5.08	0	-	0	-	-
415	8623 Dental practice activities	0	0	-	0	-	-
416	8690 Other human health activities	13.67	0	-	0	-	-
417	8710 Residential nursing care activities	3.21	0	-	0	-	-
418	8720 Residential care activities for mental retardation, mental health and substance abuse	2.01	0.22	-	0	-	-
419	8730 Residential care activities for the elderly and disabled	51.48	0	-	0.01	-	-
420	8790 Other residential care activities	25.9	0.01	-	0	-	-
421	8810 Social work activities without accommodation for the elderly and disabled	0.89	0	-	0	-	-
422	8891 Child daycare activities	0.08	0	-	0	-	-
423	8899 Other social work activities without accommodation n.e.c.	1.75	0	-	0	-	-
424	9004 Operation of arts facilities	0	0	-	0	-	-
425	9103 Operation of historical sites and buildings and similar visitor attractions	0.01	0	-	0	-	-
426	9104 Botanical and zoological gardens and nature reserves activities	0.01	0	-	0	-	-
427	9200 Gambling and betting activities	9.25	0.03	-	0	-	-
428	9311 Operation of sports facilities	1.62	0	-	0	-	-
429	9312 Activities of sport clubs	0.05	0	-	0	-	-
430	9313 Fitness facilities	9.72	0	-	0	-	-
431	9319 Other sports activities	0.75	0	-	0	-	-

432	9321 Activities of amusement parks and theme parks	1.29	0	-	0	-	-
433	9329 Other amusement and recreation activities	0.63	0	-	0	-	-
434	9412 Activities of professional membership organisations	0	0	-	0	-	-
435	9499 Activities of other membership organisations n.e.c.	1.56	0	-	0	-	-
436	9511 Repair of computers and peripheral equipment	0	0	-	0	-	-
437	9512 Repair of communication equipment	0	0	-	0	-	-
438	9601 Washing and (dry)cleaning of textile and fur products	2.38	0	-	0	-	-
439	9602 Hairdressing and other beauty treatment	0.19	0	-	0	-	-
440	9603 Funeral and related activities	36.39	0	-	0.169531	-	-
441	9604 Physical wellbeing activities	0.67	0	-	191 0	-	-
442	9609 Other personal service activities n.e.c.	5.53	0	-	0	-	-

			q	r	s	t	u	v	w	x	y	z	aa	ab
					Pollution (PPC)			Biodiversity and ecosystems (BIO)				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
							Non-financial				Non-financial
				Non-financial corporations (subject to NFRD disclosure		SMEs and other NFCs		corporations (subject to NFRD disclosure		SMEs and other NFCs		corporations (subject to NFRD disclosure		SMEs and other NFCs
obligations)					not subject to NFRD		obligations)		not subject to NFRD		obligations)		not subject to NFRD
	Carrying					amount	Carrying	amount	Carrying	amount	Carrying	amount	Carrying	amount
		Breakdown by sector - NACE 4 digits level (code and label)	[gross]	amount	Carrying [gross]		[gross]		[gross]		[gross]		[gross]
												Of which environm		Of which environm
												entally sustainab		entally sustainab
				Of which environm		Of which environm		Of which environm		Of which environm		le (CCM +		le (CCM +
				entally		entally		entally		entally		CCA + WTR + CE		CCA + WTR + CE
			in million euros	sustainab le (PPC)	in million euros	sustainab le (PPC)	in million euros	sustainab le (BIO)	in million euros	sustainab le (BIO)	in million euros	+ PPC + BIO)	in million euros	+ PPC + BIO)
1		111 Growing of cereals (except rice), leguminous crops and oil seeds	-				-				4.15	0
2 3		113 Growing of vegetables and melons, roots and tubers 119 Growing of other nonperennial crops	- -				- -				18.28 1.95	0 0
4		122 Growing of tropical and subtropical fruits	-				-				0.71	0
5		123 Growing of citrus fruits	-				-				30.59	0
6		124 Growing of pome fruits and stone fruits	-				-				1.78	0
7		125 Growing of other tree and bush fruits and nuts	-				-				8.83	0
8		130 Plant propagation	-				-				7.15	0
9		143 Raising of horses and other equines	-				-				0	0
10		145 Raising of sheep and goats	-				-				2.24	0
11		146 Raising of swine/pigs	-				-				38.46	0
12		147 Raising of poultry	-				-				9.7	0
13		149 Raising of other animals	-				-				2.08	0
14		150 Mixed farming	-				-				0.34	0
15		161 Support activities for crop production	-				-				11.71	0
16		162 Support activities for animal production	-				-				5	0
17		210 Silviculture and other forestry activities	-				-				3.45	0
18		220 Logging	-				-				0.06	0
19		311 Marine fishing	-				-				11.23	0
20		321 Marine aquaculture	-				-				4.76	0
21		610 Extraction of crude petroleum	-				-				38.46	0.1
22		729 Mining of other nonferrous metal ores	-				-				39.5	0.01
23		811 Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate	-				-				2.02	0
24		812 Operation of gravel and sand pits; mining of clays and kaolin	-				-				0.08	0
25		891 Mining of chemical and fertiliser minerals	-				-				0.01	0
26		893 Extraction of salt	-				-				0	0
27		899 Other mining and quarrying n.e.c.	-				-				0.15	0
28		1011 Processing and preserving of meat	-				-				80.1	0
29		1012 Processing and preserving of poultry meat	-				-				4.31	0
30		1013 Production of meat and poultry meat products	-				-				95.8	0

31	1020 Processing and preserving of fish, crustaceans and molluscs	-	-	54.45	0
32	1032 Manufacture of fruit and vegetable juice	-	-	15.59	0
33	1039 Other processing and preserving of fruit and vegetables	-	-	9.33	0
34	1041 Manufacture of oils and fats	-	-	1.24	0
35	1051 Operation of dairies and cheese making	-	-	77.83	0
36	1052 Manufacture of ice cream	-	-	1.22	0
37	1061 Manufacture of grain mill products	-	-	3.05	0
38	1071 Manufacture of bread; manufacture of fresh pastry goods and cakes	-	-	80.76	0
39	1072 Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes	-	-	1.08	0
40	1073 Manufacture of macaroni, noodles, couscous and similar farinaceous products	-	-	29.25	0
41	1082 Manufacture of cocoa, chocolate and sugar confectionery	-	-	77.3	0
42	1084 Manufacture of condiments and seasonings	-	-	7.32	0
43	1085 Manufacture of prepared meals and dishes	-	-	1.79	0
44	1086 Manufacture of homogenised food preparations and dietetic food	-	-	1.98	0
45	1089 Manufacture of other food products n.e.c.	-	-	35.1	0
46	1091 Manufacture of prepared feeds for farm animals	-	-	91.42	0
47	1092 Manufacture of prepared pet foods	-	-	8.41	0
48	1101 Distilling, rectifying and blending of spirits	-	-	0.45	0
49	1102 Manufacture of wine from grape	-	-	88.09	0
50	1105 Manufacture of beer	-	-	55.94	0
51	1106 Manufacture of malt	-	-	0	0
52	1107 Manufacture of soft drinks; production of mineral waters and other bottled waters	-	-	131.01	0
53	1310 Preparation and spinning of textile fibres	-	-	2.83	0
54	1320 Weaving of textiles	-	-	3.47	0
55	1330 Finishing of textiles	-	-	0.42	0
56	1391 Manufacture of knitted and crocheted fabrics	-	-	0.01	0
57	1396 Manufacture of other technical and industrial textiles	-	-	0.85	0
58	1399 Manufacture of other textiles n.e.c.	-	-	0	0
59	1412 Manufacture of workwear	-	-	0.37	0
60	1413 Manufacture of other outerwear	-	-	7.56	0
61	1419 Manufacture of other wearing apparel and accessories	-	-	8.04	0
62	1431 Manufacture of knitted and crocheted hosiery	-	-	0	0
63	1511 Tanning and dressing of leather; dressing and dyeing of fur	-	-	5.45	0
64	1520 Manufacture of footwear	-	-	0.93	0
65	1610 Sawmilling and planing of wood	-	-	0.13	0
66	1621 Manufacture of veneer sheets and woodbased panels	-	-	27.36	0
67	1623 Manufacture of other builders' carpentry and joinery	-	-	7.34	0
68	1629 Manufacture of other products of wood; manufacture of articles of cork, straw and plaiting materials	-	-	0	0
69	1711 Manufacture of pulp	-	-	30.89	7.36
70	1712 Manufacture of paper and paperboard	-	-	47.91	0
71	1721 Manufacture of corrugated paper and paperboard and of containers of paper and paperboard	-	-	20.04	0
72	1722 Manufacture of household and sanitary goods and of toilet requisites	-	-	0.01	0
73	1723 Manufacture of paper stationery	-	-	2.4	0
74	1811 Printing of newspapers	-	-	0.71	0
75	1812 Other printing	-	-	0.8	0
76	1920 Manufacture of refined petroleum products	-	-	123.97	0.03
77	2011 Manufacture of industrial gases	-	-	0.02	0
78	2012 Manufacture of dyes and pigments	-	-	1.68	0
79	2013 Manufacture of other inorganic basic chemicals	-	-	14.78	0
80	2014 Manufacture of other organic basic chemicals	-	-	0.7	0
81	2015 Manufacture of fertilisers and nitrogen compounds	-	-	21.44	1.75
82	2016 Manufacture of plastics in primary forms	-	-	8.57	0
83	2017 Manufacture of synthetic rubber in primary forms	-	-	14.19	0
84	2020 Manufacture of pesticides and other agrochemical products	-	-	13.79	0
85	2030 Manufacture of paints, varnishes and similar coatings, printing ink and mastics	-	-	17.85	0
86	2041 Manufacture of soap and detergents, cleaning and polishing preparations	-	-	5.97	0

87	2042 Manufacture of perfumes and toilet preparations	-	-	2.39	0
88	2051 Manufacture of explosives	-	-	72.03	0
89	2059 Manufacture of other chemical products n.e.c.	-	-	4.39	0
90	2110 Manufacture of basic pharmaceutical products	-	-	112.87	0
91	2120 Manufacture of pharmaceutical preparations	-	-	34.79	0
92	2211 Manufacture of rubber tyres and tubes; retreading and rebuilding of rubber tyres	-	-	10.41	0
93	2219 Manufacture of other rubber products	-	-	5.6	0
94	2221 Manufacture of plastic plates, sheets, tubes and profiles	-	-	16.43	0
95	2222 Manufacture of plastic packing goods	-	-	14.14	0
96	2223 Manufacture of builders' ware of plastic	-	-	6.09	0
97	2229 Manufacture of other plastic products	-	-	80.54	0
98	2311 Manufacture of flat glass	-	-	1.2	0
99	2312 Shaping and processing of flat glass	-	-	0.6	0
100	2313 Manufacture of hollow glass	-	-	2.63	0
101	2314 Manufacture of glass fibres	-	-	0.05	0
102	2319 Manufacture and processing of other glass, including technical glassware	-	-	2.52	0
103	2320 Manufacture of refractory products	-	-	2.9	0
104	2331 Manufacture of ceramic tiles and flags	-	-	53.47	0
105	2332 Manufacture of bricks, tiles and construction products, in baked clay	-	-	1.11	0
106	2342 Manufacture of ceramic sanitary fixtures	-	-	44.63	0
107	2344 Manufacture of other technical ceramic products	-	-	2.15	0
108	2349 Manufacture of other ceramic products	-	-	4.36	0
109	2351 Manufacture of cement	-	-	55.16	0.39
110	2352 Manufacture of lime and plaster	-	-	6.84	0
111	2361 Manufacture of concrete products for construction purposes	-	-	0.11	0
112	2363 Manufacture of ready-mixed concrete	-	-	3.78	0
113	2364 Manufacture of mortars	-	-	0.02	0
114	2369 Manufacture of other articles of concrete, plaster and cement	-	-	0.12	0
115	2370 Cutting, shaping and finishing of stone	-	-	8.86	0
116	2399 Manufacture of other non-metallic mineral products n.e.c.	-	-	5.74	0
117	2410 Manufacture of basic iron and steel and of ferroalloys	-	-	56.32	7.53
118	2420 Manufacture of tubes, pipes, hollow profiles and related fittings, of steel	-	-	28.03	0.55
119	2431 Cold drawing of bars	-	-	0.01	0
120	2432 Cold rolling of narrow strip	-	-	19.92	0
121	2433 Cold forming or folding	-	-	0.07	0
122	2434 Cold drawing of wire	-	-	0.09	0
123	2442 Aluminium production	-	-	37.59	0
124	2445 Other nonferrous metal production	-	-	381.3	264.4
125	2446 Processing of nuclear fuel	-	-	40	0
126	2451 Casting of iron	-	-	3.56	0
127	2452 Casting of steel	-	-	10.42	0
128	2453 Casting of light metals	-	-	4.47	0
129	2454 Casting of other nonferrous metals	-	-	0.41	0
130	2511 Manufacture of metal structures and parts of structures	-	-	63.78	0
131	2512 Manufacture of doors and windows of metal	-	-	0.86	0
132	2521 Manufacture of central heating radiators and boilers	-	-	0	0
133	2529 Manufacture of other tanks, reservoirs and containers of metal	-	-	1.7	0
134	2540 Manufacture of weapons and ammunition	-	-	2.08	0
135	2550 Forging, pressing, stamping and rollforming of metal; powder metallurgy	-	-	78	0.19
136	2561 Treatment and coating of metals	-	-	9.43	0
137	2562 Machining	-	-	4.65	0
138	2571 Manufacture of cutlery	-	-	0.03	0
139	2572 Manufacture of locks and hinges	-	-	1.84	0
140	2592 Manufacture of light metal packaging	-	-	14.69	0
141	2593 Manufacture of wire products, chain and springs	-	-	3.58	0
142	2594 Manufacture of fasteners and screw machine products	-	-	1.63	0

143	2599 Manufacture of other fabricated metal products n.e.c.	-	-	16.51	0
144	2611 Manufacture of electronic components	-	-	4.65	0
145	2612 Manufacture of loaded electronic boards	-	-	0.7	0
146	2620 Repair of computers and peripheral equipment	-	-	0	0
147	2630 Manufacture of communication equipment	-	-	0	0
148	2651 Manufacture of instruments and appliances for measuring, testing and navigation	-	-	0.07	0
149	2652 Manufacture of watches and clocks	-	-	3.94	0
150	2660 Manufacture of irradiation, electromedical and electrotherapeutic equipment	-	-	3.75	0
151	2670 Manufacture of optical instruments and photographic equipment	-	-	0.04	0
152	2711 Manufacture of electric motors, generators and transformers	-	-	95.29	0
153	2712 Manufacture of electricity distribution and control apparatus	-	-	3.71	0
154	2720 Manufacture of batteries and accumulators	-	-	0.02	0
155	2732 Manufacture of other electronic and electric wires and cables	-	-	11.14	0
156	2740 Manufacture of electric lighting equipment	-	-	0.01	0
157	2751 Manufacture of electric domestic appliances	-	-	1.48	0
158	2790 Manufacture of other electrical equipment	-	-	14.86	0.11
159	2811 Manufacture of engines and turbines, except aircraft, vehicle and cycle engines	-	-	0.04	0
160	2813 Manufacture of other pumps and compressors	-	-	0	0
161	2815 Manufacture of bearings, gears, gearing and driving elements	-	-	6.68	0
162	2822 Manufacture of lifting and handling equipment	-	-	13.63	0
163	2825 Manufacture of nondomestic cooling and ventilation equipment	-	-	78	0
164	2829 Manufacture of other general purpose machinery n.e.c.	-	-	3.98	0
165	2830 Manufacture of agricultural and forestry machinery	-	-	1.99	0
166	2841 Manufacture of metal forming machinery	-	-	17.83	0
167	2849 Manufacture of other machine tools	-	-	1.89	0
168	2891 Manufacture of machinery for metallurgy	-	-	0.26	0
169	2892 Manufacture of machinery for mining, quarrying and construction	-	-	4.96	0
170	2893 Manufacture of machinery for food, beverage and tobacco processing	-	-	0	0
171	2894 Manufacture of machinery for textile, apparel and leather production	-	-	0.96	0
172	2895 Manufacture of machinery for paper and paperboard production	-	-	0.19	0
173	2896 Manufacture of plastics and rubber machinery	-	-	5.35	0
174	2899 Manufacture of other special purpose machinery n.e.c.	-	-	7.98	0
175	2910 Manufacture of motor vehicles	-	-	43.72	0
176	2920 Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and semitrailers	-	-	2.35	0
177	2931 Manufacture of electrical and electronic equipment for motor vehicles	-	-	1.36	0
178	2932 Manufacture of other parts and accessories for motor vehicles	-	-	329.51	0.47
179	3011 Building of ships and floating structures	-	-	4.21	0.85
180	3020 Manufacture of railway locomotives and rolling stock	-	-	46.29	16.05
181	3030 Manufacture of air and spacecraft and related machinery	-	-	72.53	0
182	3040 Manufacture of military fighting vehicles	-	-	0.1	0
183	3101 Manufacture of office and shop furniture	-	-	0.98	0
184	3102 Manufacture of kitchen furniture	-	-	1.55	0
185	3103 Manufacture of mattresses	-	-	2.3	0
186	3109 Manufacture of other furniture	-	-	0.04	0
187	3250 Manufacture of medical and dental instruments and supplies	-	-	5.87	0
188	3299 Other manufacturing n.e.c.	-	-	4.31	0
189	3312 Repair of machinery	-	-	0.43	0
190	3314 Repair of electrical equipment	-	-	0	0
191	3317 Repair and maintenance of other transport equipment	-	-	0.49	0.01
192	3319 Repair of other equipment	-	-	0	0
193	3320 Installation of industrial machinery and equipment	-	-	4.39	0.14
194	3511 Production of electricity	-	-	461.94	101.11
195	3512 Transmission of electricity	-	-	11.39	0
196	3513 Distribution of electricity	-	-	260.39	39.51
197	3514 Trade of electricity	-	-	12.04	0.51
198	3521 Manufacture of gas	-	-	104.12	6.25

199	3522 Distribution of gaseous fuels through mains	-	-	251.37	28
200	3523 Trade of gas through mains	-	-	5.8	0
201	3600 Water collection, treatment and supply	-	-	121.24	11.86
202	3700 Sewerage	-	-	11.22	4.81
203	3811 Collection of non-hazardous waste	-	-	22.27	0.01
204	3821 Treatment and disposal of non-hazardous waste	-	-	47.48	0
205	3822 Treatment and disposal of hazardous waste	-	-	0.1	0
206	3831 Dismantling of wrecks	-	-	15.37	0
207	3832 Recovery of sorted materials	-	-	6.5	4.66
208	3900 Remediation activities and other waste management services	-	-	0.73	0
209	4110 Development of building projects	-	-	105.6	0
210	4120 Construction of residential and non-residential buildings	-	-	65.79	0
211	4211 Construction of roads and motorways	-	-	89.95	5.34
212	4212 Construction of railways and underground railways	-	-	322.43	157.01
213	4213 Construction of bridges and tunnels	-	-	31.21	11.72
214	4222 Construction of utility projects for electricity and telecommunications	-	-	11.16	0
215	4291 Construction of water projects	-	-	0.43	0
216	4299 Construction of other civil engineering projects n.e.c.	-	-	196.41	23.3
217	4311 Demolition	-	-	0	0
218	4312 Site preparation	-	-	0	0
219	4321 Electrical installation	-	-	198.18	0.04
220	4322 Plumbing, heat and airconditioning installation	-	-	44.4	0
221	4329 Other construction installation	-	-	0.1	0
222	4331 Plastering	-	-	0	0
223	4333 Floor and wall covering	-	-	1.85	0
224	4334 Painting and glazing	-	-	0.07	0
225	4339 Other building completion and finishing	-	-	0.29	0
226	4399 Other specialised construction activities n.e.c.	-	-	104.79	11.61
227	4511 Sale of cars and light motor vehicles	-	-	36.05	0
228	4519 Sale of other motor vehicles	-	-	3.43	0
229	4520 Maintenance and repair of motor vehicles	-	-	0.14	0
230	4531 Wholesale trade of motor vehicle parts and accessories	-	-	1.61	0
231	4532 Retail trade of motor vehicle parts and accessories	-	-	1.37	0
232	4540 Sale, maintenance and repair of motorcycles and related parts and accessories	-	-	0.59	0.32
233	4611 Agents involved in the sale of agricultural raw materials, live animals, textile raw materials and semifinished goods	-	-	0.2	0
234	4612 Agents involved in the sale of fuels, ores, metals and industrial chemicals	-	-	1.95	0
235	4613 Agents involved in the sale of timber and building materials	-	-	2.16	0
236	4614 Agents involved in the sale of machinery, industrial equipment, ships and aircraft	-	-	4.78	0
237	4615 Agents involved in the sale of furniture, household goods, hardware and ironmongery	-	-	6.5	0
238	4617 Agents involved in the sale of food, beverages and tobacco	-	-	6.62	0
239	4619 Agents involved in the sale of a variety of goods	-	-	12.49	0
240	4621 Wholesale of grain, unmanufactured tobacco, seeds and animal feeds	-	-	42.95	0
241	4623 Wholesale of live animals	-	-	1.49	0
242	4624 Wholesale of hides, skins and leather	-	-	3.14	0
243	4631 Wholesale of fruit and vegetables	-	-	51.83	0
244	4632 Wholesale of meat and meat products	-	-	30.52	0
245	4633 Wholesale of dairy products, eggs and edible oils and fats	-	-	47.67	0
246	4634 Wholesale of beverages	-	-	14.35	0
247	4635 Wholesale of tobacco products	-	-	0	0
248	4636 Wholesale of sugar and chocolate and sugar confectionery	-	-	3.46	0
249	4637 Wholesale of coffee, tea, cocoa and spices	-	-	0.94	0
250	4638 Wholesale of other food, including fish, crustaceans and molluscs	-	-	45.85	0
251	4639 Nonspecialised wholesale of food, beverages and tobacco	-	-	78.74	0
252	4641 Wholesale of textiles	-	-	0.34	0
253	4642 Wholesale of clothing and footwear	-	-	43.72	0
254	4643 Wholesale of electrical household appliances	-	-	29.75	0

255	4644 Wholesale of china and glassware and cleaning materials	-	-	1.59	0
256	4645 Wholesale of perfume and cosmetics	-	-	324.42	0
257	4646 Wholesale of pharmaceutical goods	-	-	93.54	0
258	4648 Wholesale of watches and jewellery	-	-	0.08	0
259	4649 Wholesale of other household goods	-	-	4.71	0
260	4651 Wholesale of computers, computer peripheral equipment and software	-	-	12.39	0
261	4652 Wholesale of electronic and telecommunications equipment and parts	-	-	3.34	0
262	4661 Wholesale of agricultural machinery, equipment and supplies	-	-	0.05	0
263	4662 Wholesale of machine tools	-	-	0.13	0
264	4663 Wholesale of mining, construction and civil engineering machinery	-	-	0.18	0
265	4665 Wholesale of office furniture	-	-	6.16	0
266	4666 Wholesale of other office machinery and equipment	-	-	9.93	0
267	4669 Wholesale of other machinery and equipment	-	-	35.06	0
268	4671 Wholesale of solid, liquid and gaseous fuels and related products	-	-	14.29	0
269	4672 Wholesale of metals and metal ores	-	-	120.84	3.18
270	4673 Wholesale of wood, construction materials and sanitary equipment	-	-	114.93	0
271	4674 Wholesale of hardware, plumbing and heating equipment and supplies	-	-	47.59	0
272	4675 Wholesale of chemical products	-	-	33.26	0
273	4676 Wholesale of other intermediate products	-	-	52.03	0
274	4677 Wholesale of waste and scrap	-	-	0.83	0
275	4690 Nonspecialised wholesale trade	-	-	16.77	0
276	4711 Retail sale in nonspecialised stores with food, beverages or tobacco predominating	-	-	433.56	0
277	4719 Other retail sale in nonspecialised stores	-	-	163.82	0.03
278	4721 Retail sale of fruit and vegetables in specialised stores	-	-	15.73	0
279	4722 Retail sale of meat and meat products in specialised stores	-	-	6.61	0
280	4724 Retail sale of bread, cakes, flour confectionery and sugar confectionery in specialised stores	-	-	0.32	0
281	4729 Other retail sale of food in specialised stores	-	-	29.34	0
282	4730 Retail sale of automotive fuel in specialised stores	-	-	47.17	0.04
283	4741 Retail sale of computers, peripheral units and software in specialised stores	-	-	0.69	0
284	4742 Retail sale of telecommunications equipment in specialised stores	-	-	7.44	0
285	4751 Retail sale of textiles in specialised stores	-	-	0	0
286	4752 Retail sale of hardware, paints and glass in specialised stores	-	-	36.63	0
287	4759 Retail sale of furniture, lighting equipment and other household articles in specialised stores	-	-	18.58	0
288	4761 Retail sale of books in specialised stores	-	-	0.15	0
289	4764 Retail sale of sporting equipment in specialised stores	-	-	1.71	0
290	4765 Retail sale of games and toys in specialised stores	-	-	0.03	0
291	4771 Retail sale of clothing in specialised stores	-	-	107.04	0
292	4772 Retail sale of footwear and leather goods in specialised stores	-	-	1.96	0
293	4773 Dispensing chemist in specialised stores	-	-	0.05	0
294	4774 Retail sale of medical and orthopaedic goods in specialised stores	-	-	0.09	0
295	4775 Retail sale of cosmetic and toilet articles in specialised stores	-	-	35.39	0
296	4776 Retail sale of flowers, plants, seeds, fertilisers, pet animals and pet food in specialised stores	-	-	0.93	0
297	4777 Retail sale of watches and jewellery in specialised stores	-	-	0.68	0
298	4778 Other retail sale of new goods in specialised stores	-	-	100.63	0.01
299	4781 Retail sale via stalls and markets of food, beverages and tobacco products	-	-	3.46	0
300	4791 Retail sale via mail order houses or via Internet	-	-	2.12	0
301	4799 Other retail sale not in stores, stalls or markets	-	-	3.99	0
302	4910 Passenger rail transport, interurban	-	-	405	5.7
303	4920 Freight rail transport	-	-	0.01	0
304	4931 Urban and suburban passenger land transport	-	-	156.45	0
305	4932 Taxi operation	-	-	0.6	0
306	4939 Other passenger land transport n.e.c.	-	-	37.58	0
307	4941 Freight transport by road	-	-	67.63	0
308	4950 Transport via pipeline	-	-	26.07	0
309	5010 Sea and coastal passenger water transport	-	-	19.72	0
310	5020 Sea and coastal freight water transport	-	-	47.19	0

311	5110 Passenger air transport	-	-	5.42	0
312	5121 Freight air transport	-	-	0	0
313	5210 Warehousing and storage	-	-	7.63	0
314	5221 Service activities incidental to land transportation	-	-	281.1	6.66
315	5222 Service activities incidental to water transportation	-	-	109.35	0
316	5223 Service activities incidental to air transportation	-	-	360.73	126.06
317	5224 Cargo handling	-	-	0.29	0
318	5229 Other transportation support activities	-	-	36.44	0
319	5310 Postal activities under universal service obligation	-	-	48.1	0
320	5320 Other postal and courier activities	-	-	12.57	0
321	5510 Hotels and similar accommodation	-	-	676.74	0
322	5520 Holiday and other short-stay accommodation	-	-	22.86	0
323	5530 Camping grounds, recreational vehicle parks and trailer parks	-	-	1.25	0
324	5590 Other accommodation	-	-	1.02	0
325	5610 Restaurants and mobile food service activities	-	-	92.67	0
326	5621 Event catering activities	-	-	0.24	0
327	5629 Other food service activities	-	-	0.94	0
328	5630 Beverage serving activities	-	-	2.93	0
329	5811 Book publishing	-	-	1.39	0
330	5813 Publishing of newspapers	-	-	3.93	0
331	5819 Other publishing activities	-	-	5.06	0
332	5821 Publishing of computer games	-	-	20.1	0
333	5829 Other software publishing	-	-	0.43	0
334	5912 Motion picture, video and television programme postproduction activities	-	-	9.5	0
335	6010 Radio broadcasting	-	-	0.01	0
336	6020 Television programming and broadcasting activities	-	-	8.44	0
337	6110 Wired telecommunications activities	-	-	289.91	1.61
338	6120 Wireless telecommunications activities	-	-	0.23	0
339	6130 Satellite telecommunications activities	-	-	0.09	0
340	6190 Other telecommunications activities	-	-	401.62	2.35
341	6201 Computer programming activities	-	-	8.19	0.01
342	6202 Computer consultancy activities	-	-	27.35	0.55
343	6203 Computer facilities management activities	-	-	1.34	0
344	6209 Other information technology and computer service activities	-	-	19.1	0
345	6311 Data processing, hosting and related activities	-	-	3.3	0
346	6312 Web portals	-	-	0.17	0
347	6391 News agency activities	-	-	0	0
348	6399 Other information service activities n.e.c.	-	-	0	0
349	6420 Activities of holding companies	-	-	765.71	0.01
350	6499 Other financial service activities, except insurance and pension funding n.e.c.	-	-	149.29	53.09
351	6612 Security and commodity contracts brokerage	-	-	0.2	0
352	6619 Other activities auxiliary to financial services, except insurance and pension funding	-	-	332.46	266.14
353	6622 Activities of insurance agents and brokers	-	-	0.84	0.01
354	6810 Buying and selling of own real estate	-	-	74.96	0
355	6820 Renting and operating of own or leased real estate	-	-	347.72	0.91
356	6831 Real estate agencies	-	-	0.95	0
357	6832 Management of real estate on a fee or contract basis	-	-	38.6	0.23
358	6910 Legal activities	-	-	7.59	0
359	6920 Accounting, bookkeeping and auditing activities; tax consultancy	-	-	21.83	0
360	7010 Activities of head offices	-	-	256.85	5.75
361	7021 Public relations and communication activities	-	-	0	0
362	7022 Business and other management consultancy activities	-	-	70.45	0.01
363	7111 Architectural activities	-	-	0.25	0
364	7112 Engineering activities and related technical consultancy	-	-	104.83	0.1
365	7120 Technical testing and analysis	-	-	15.45	0
366	7219 Other research and experimental development on natural sciences and engineering	-	-	2.01	0

367	7220 Research and experimental development on social sciences and humanities	-	-	0.79	0
368	7311 Advertising agencies	-	-	16.72	0
369	7312 Media representation	-	-	0	0
370	7320 Market research and public opinion polling	-	-	1.5	0
371	7410 Specialised design activities	-	-	0.01	0
372	7420 Photographic activities	-	-	0.11	0.02
373	7490 Other professional, scientific and technical activities n.e.c.	-	-	51.56	2.23
374	7500 Veterinary activities	-	-	3.26	0
375	7711 Renting and leasing of cars and light motor vehicles	-	-	24.79	0
376	7712 Renting and leasing of trucks	-	-	3.68	0
377	7732 Renting and leasing of construction and civil engineering machinery and equipment	-	-	12.91	0
378	7734 Renting and leasing of water transport equipment	-	-	1.21	0
379	7735 Renting and leasing of air transport equipment	-	-	57.81	0
380	7739 Renting and leasing of other machinery, equipment and tangible goods n.e.c.	-	-	84.58	0.57
381	7740 Leasing of intellectual property and similar products, except copyrighted works	-	-	0.74	0
382	7810 Activities of employment placement agencies	-	-	0.02	0
383	7820 Temporary employment agency activities	-	-	11.19	0
384	7830 Other human resources provision	-	-	0.01	0
385	7911 Travel agency activities	-	-	11.91	0
386	7912 Tour operator activities	-	-	7.15	0
387	7990 Other reservation service and related activities	-	-	0.01	0
388	8010 Private security activities	-	-	4.65	0
389	8020 Security systems service activities	-	-	5.19	0
390	8110 Combined facilities support activities	-	-	12.86	0
391	8121 General cleaning of buildings	-	-	3.74	0.24
392	8122 Other building and industrial cleaning activities	-	-	11.81	0
393	8129 Other cleaning activities	-	-	4.86	0
394	8130 Landscape service activities	-	-	0.08	0
395	8211 Combined office administrative service activities	-	-	1.61	0
396	8219 Photocopying, document preparation and other specialised office support activities	-	-	0.42	0
397	8220 Activities of call centres	-	-	0.84	0
398	8230 Organisation of conventions and trade shows	-	-	3.09	0
399	8291 Activities of collection agencies and credit bureaus	-	-	2.74	0
400	8292 Packaging activities	-	-	0.02	0
401	8299 Other business support service activities n.e.c.	-	-	3.91	0
402	8411 General public administration activities	-	-	573.54	0.94
403	8412 Regulation of the activities of providing health care, education, cultural services and other social services, excluding social security	-	-	0	0
404	8413 Regulation of and contribution to more efficient operation of businesses	-	-	0	0
405	8520 Primary education	-	-	0.04	0
406	8531 General secondary education	-	-	0.2	0
407	8532 Technical and vocational secondary education	-	-	30.01	0
408	8541 Postsecondary non	-	-	10.81	0
409	8552 Cultural education	-	-	0.91	0
410	8559 Other education n.e.c.	-	-	8.83	0
411	8560 Educational support activities	-	-	2.48	0
412	8610 Hospital activities	-	-	73.86	0
413	8621 General medical practice activities	-	-	10.27	0.01
414	8622 Specialist medical practice activities	-	-	5.08	0
415	8623 Dental practice activities	-	-	0	0
416	8690 Other human health activities	-	-	13.67	0
417	8710 Residential nursing care activities	-	-	3.21	0
418	8720 Residential care activities for mental retardation, mental health and substance abuse	-	-	2.01	0.22
419	8730 Residential care activities for the elderly and disabled	-	-	51.48	0.01
420	8790 Other residential care activities	-	-	25.9	0.01
421	8810 Social work activities without accommodation for the elderly and disabled	-	-	0.89	0
422	8891 Child daycare activities	-	-	0.08	0

423	8899 Other social work activities without accommodation n.e.c.	-	-	1.75	0
424	9004 Operation of arts facilities	-	-	0	0
425	9103 Operation of historical sites and buildings and similar visitor attractions	-	-	0.01	0
426	9104 Botanical and zoological gardens and nature reserves activities	-	-	0.01	0
427	9200 Gambling and betting activities	-	-	9.25	0.03
428	9311 Operation of sports facilities	-	-	1.62	0
429	9312 Activities of sport clubs	-	-	0.05	0
430	9313 Fitness facilities	-	-	9.72	0
431	9319 Other sports activities	-	-	0.75	0
432	9321 Activities of amusement parks and theme parks	-	-	1.29	0
433	9329 Other amusement and recreation activities	-	-	0.63	0
434	9412 Activities of professional membership organisations	-	-	0	0
435	9499 Activities of other membership organisations n.e.c.	-	-	1.56	0
436	9511 Repair of computers and peripheral equipment	-	-	0	0
437	9512 Repair of communication equipment	-	-	0	0
438	9601 Washing and (dry)cleaning of textile and fur products	-	-	2.38	0
439	9602 Hairdressing and other beauty treatment	-	-	0.19	0
440	9603 Funeral and related activities	-	-	36.39	0.17
441	9604 Physical wellbeing activities	-	-	0.67	0
442	9609 Other personal service activities n.e.c.	-	-	5.53	0

Assets of non-financial corporations used to calculate the GAR in relation to CapEx KPIs, broken down by activity sector

			a	b	c	d	e	f	g	h	i	j	k	l	m	n	0	p
			Climate Change Adaptation (CCM)				Climate Change Adaptation (CCA)			Water and Marine Resources (WTR)				Circular Economy (CE)
		Non-financial obligations)	corporations (subject to NFRD disclosure	not subject to NFRD	SMEs and other NFCs	Non-financial obligations)	corporations (subject to NFRD disclosure	not subject to NFRD	SMEs and other NFCs	Non-financial corporations (subject to NFRD disclosure obligations)		SMEs and other NFCs not subject to NFRD		Non-financial corporations (subject to NFRD disclosure obligations)		SMEs and other NFCs not subject to NFRD
		Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount
		Breakdown by sector - NACE 4 digits level (code and label)	in million euros	Of which environm entally sustainab le (CCM)	in million euros	Of which environm entally sustainab le (CCM)	in million euros	Of which environm entally sustainab le (CCA)	in million euros	Of which environm entally sustainab le (CCA)	in million euros	Of which environm entally sustainab le (WTR)	in million euros	Of which environm entally sustainab le (WTR)	in million euros	Of which environm entally sustainab le (CE)	in million euros	Of which environm entally sustainab le (CE)
1		111 Growing of cereals (except rice), leguminous crops and oil seeds	4.15	0	0	0	-	0	0	0	-				-
2		113 Growing of vegetables and melons, roots and tubers	18.28	0	0	0	-	0	0	0	-				-
3		119 Growing of other nonperennial crops	1.95	0	0	0	-	0	0	0	-				-
4		122 Growing of tropical and subtropical fruits	0.71	0	0	0	-	0	0	0	-				-
5		123 Growing of citrus fruits	30.59	0	0	0	-	0	0	0	-				-
6		124 Growing of pome fruits and stone fruits	1.78	0	0	0	-	0	0	0	-				-
7		125 Growing of other tree and bush fruits and nuts	8.83	0	0	0	-	0	0	0	-				-
8		130 Plant propagation	7.15	0	0	0	-	0	0	0	-				-
9		143 Raising of horses and other equines	0	0	0	0	-	0	0	0	-				-
10		145 Raising of sheep and goats	2.24	0	0	0	-	0	0	0	-				-
11		146 Raising of swine/pigs	38.46	0	0	0	-	0	0	0	-				-
12		147 Raising of poultry	9.7	0	0	0	-	0	0	0	-				-
13		149 Raising of other animals	2.08	0	0	0	-	0	0	0	-				-
14		150 Mixed farming	0.34	0	0	0	-	0	0	0	-				-
15		161 Support activities for crop production	11.71	0	0	0	-	0	0	0	-				-
16		162 Support activities for animal production	5	0	0	0	-	0	0	0	-				-
17		210 Silviculture and other forestry activities	3.45	0	0	0	-	0	0	0	-				-
18		220 Logging	0.06	0	0	0	-	0	0	0	-				-
19		311 Marine fishing	11.23	0	0	0	-	0	0	0	-				-
20		321 Marine aquaculture	4.76	0	0	0	-	0	0	0	-				-

21	610 Extraction of crude petroleum	38.46	12.33	0	0	-	0	0	0	-	-
22	729 Mining of other nonferrous metal ores	39.5	0.07	0	0	-	0	0	0	-	-
23	811 Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate	2.02	0	0	0	-	0	0	0	-	-
24	812 Operation of gravel and sand pits; mining of clays and kaolin	0.08	0	0	0	-	0	0	0	-	-
25	891 Mining of chemical and fertiliser minerals	0.01	0	0	0	-	0	0	0	-	-
26	893 Extraction of salt	0	0	0	0	-	0	0	0	-	-
27	899 Other mining and quarrying n.e.c.	0.15	0	0	0	-	0	0	0	-	-
28	1011 Processing and preserving of meat	80.1	0	0	0	-	0	0	0	-	-
29	1012 Processing and preserving of poultry meat	4.31	0	0	0	-	0	0	0	-	-
30	1013 Production of meat and poultry meat products	95.8	0	0	0	-	0	0	0	-	-
31	1020 Processing and preserving of fish, crustaceans and molluscs	54.45	0	0	0	-	0	0	0	-	-
32	1032 Manufacture of fruit and vegetable juice	15.59	0	0	0	-	0	0	0	-	-
33	1039 Other processing and preserving of fruit and vegetables	9.33	0	0	0	-	0	0	0	-	-
34	1041 Manufacture of oils and fats	1.24	0	0	0	-	0	0	0	-	-
35	1051 Operation of dairies and cheese making	77.83	0	0	0	-	0	0	0	-	-
36	1052 Manufacture of ice cream	1.22	0	0	0	-	0	0	0	-	-
37	1061 Manufacture of grain mill products	3.05	0	0	0	-	0	0	0	-	-
38	1071 Manufacture of bread; manufacture of fresh pastry goods and cakes	80.76	0	0	0	-	0	0	0	-	-
39	1072 Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes	1.08	0	0	0	-	0	0	0	-	-
40	1073 Manufacture of macaroni, noodles, couscous and similar farinaceous products	29.25	0	0	0	-	0	0	0	-	-
41	1082 Manufacture of cocoa, chocolate and sugar confectionery	77.3	0	0	0	-	0	0	0	-	-
42	1084 Manufacture of condiments and seasonings	7.32	0	0	0	-	0	0	0	-	-
43	1085 Manufacture of prepared meals and dishes	1.79	0	0	0	-	0	0	0	-	-
44	1086 Manufacture of homogenised food preparations and dietetic food	1.98	0	0	0	-	0	0	0	-	-
45	1089 Manufacture of other food products n.e.c.	35.1	0	0	0	-	0	0	0	-	-
46	1091 Manufacture of prepared feeds for farm animals	91.42	0	0	0	-	0	0	0	-	-
47	1092 Manufacture of prepared pet foods	8.41	0	0	0	-	0	0	0	-	-
48	1101 Distilling, rectifying and blending of spirits	0.45	0	0	0	-	0	0	0	-	-
49	1102 Manufacture of wine from grape	88.09	0	0	0	-	0	0	0	-	-
50	1105 Manufacture of beer	55.94	0	0	0	-	0	0	0	-	-
51	1106 Manufacture of malt	0	0	0	0	-	0	0	0	-	-
52	1107 Manufacture of soft drinks; production of mineral waters and other bottled waters	131.01	0	0	0	-	0	0	0	-	-
53	1310 Preparation and spinning of textile fibres	2.83	0	0	0	-	0	0	0	-	-
54	1320 Weaving of textiles	3.47	0	0	0	-	0	0	0	-	-
55	1330 Finishing of textiles	0.42	0	0	0	-	0	0	0	-	-
56	1391 Manufacture of knitted and crocheted fabrics	0.01	0	0	0	-	0	0	0	-	-
57	1396 Manufacture of other technical and industrial textiles	0.85	0	0	0	-	0	0	0	-	-
58	1399 Manufacture of other textiles n.e.c.	0	0	0	0	-	0	0	0	-	-
59	1412 Manufacture of workwear	0.37	0	0	0	-	0	0	0	-	-
60	1413 Manufacture of other outerwear	7.56	0.12	0	0	-	0	0	0	-	-
61	1419 Manufacture of other wearing apparel and accessories	8.04	0	0	0	-	0	0	0	-	-
62	1431 Manufacture of knitted and crocheted hosiery	0	0	0	0	-	0	0	0	-	-
63	1511 Tanning and dressing of leather; dressing and dyeing of fur	5.45	0	0	0	-	0	0	0	-	-
64	1520 Manufacture of footwear	0.93	0	0	0	-	0	0	0	-	-
65	1610 Sawmilling and planing of wood	0.13	0	0	0	-	0	0	0	-	-
66	1621 Manufacture of veneer sheets and woodbased panels	27.36	0	0	0	-	0	0	0	-	-
67	1623 Manufacture of other builders' carpentry and joinery	7.34	0	0	0	-	0	0	0	-	-
68	1629 Manufacture of other products of wood; manufacture of articles of cork, straw and plaiting materials	0	0	0	0	-	0	0	0	-	-
69	1711 Manufacture of pulp	30.89	14.63	0	0	-	0	0	0	-	-
70	1712 Manufacture of paper and paperboard	47.91	0	0	0	-	0	0	0	-	-
71	1721 Manufacture of corrugated paper and paperboard and of containers of paper and paperboard	20.04	0	0	0	-	0	0	0	-	-
72	1722 Manufacture of household and sanitary goods and of toilet requisites	0.01	0	0	0	-	0	0	0	-	-
73	1723 Manufacture of paper stationery	2.4	0	0	0	-	0	0	0	-	-
74	1811 Printing of newspapers	0.71	0	0	0	-	0	0	0	-	-
75	1812 Other printing	0.8	0	0	0	-	0	0	0	-	-
76	1920 Manufacture of refined petroleum products	123.97	10.49	0	0	-	0	0	0	-	-

77	2011 Manufacture of industrial gases	0.02	0	0	0	-	0	0	0	-	-
78	2012 Manufacture of dyes and pigments	1.68	0	0	0	-	0	0	0	-	-
79	2013 Manufacture of other inorganic basic chemicals	14.78	0	0	0	-	2.06	0	0	-	-
80	2014 Manufacture of other organic basic chemicals	0.7	0	0	0	-	0	0	0	-	-
81	2015 Manufacture of fertilisers and nitrogen compounds	21.44	1.7	0	0	-	1.01	0	0	-	-
82	2016 Manufacture of plastics in primary forms	8.57	0	0	0	-	0	0	0	-	-
83	2017 Manufacture of synthetic rubber in primary forms	14.19	0	0	0	-	0	0	0	-	-
84	2020 Manufacture of pesticides and other agrochemical products	13.79	0	0	0	-	0	0	0	-	-
85	2030 Manufacture of paints, varnishes and similar coatings, printing ink and mastics	17.85	0	0	0	-	0	0	0	-	-
86	2041 Manufacture of soap and detergents, cleaning and polishing preparations	5.97	0	0	0	-	0	0	0	-	-
87	2042 Manufacture of perfumes and toilet preparations	2.39	0	0	0	-	0	0	0	-	-
88	2051 Manufacture of explosives	72.03	0	0	0	-	0	0	0	-	-
89	2059 Manufacture of other chemical products n.e.c.	4.39	0	0	0	-	0	0	0	-	-
90	2110 Manufacture of basic pharmaceutical products	112.87	0	0	0	-	0	0	0	-	-
91	2120 Manufacture of pharmaceutical preparations	34.79	0	0	0	-	0	0	0	-	-
92	2211 Manufacture of rubber tyres and tubes; retreading and rebuilding of rubber tyres	10.41	0	0	0	-	0	0	0	-	-
93	2219 Manufacture of other rubber products	5.6	0	0	0	-	0	0	0	-	-
94	2221 Manufacture of plastic plates, sheets, tubes and profiles	16.43	0	0	0	-	0	0	0	-	-
95	2222 Manufacture of plastic packing goods	14.14	0	0	0	-	0	0	0	-	-
96	2223 Manufacture of builders' ware of plastic	6.09	0	0	0	-	0	0	0	-	-
97	2229 Manufacture of other plastic products	80.54	0	0	0	-	0	0	0	-	-
98	2311 Manufacture of flat glass	1.2	0	0	0	-	0	0	0	-	-
99	2312 Shaping and processing of flat glass	0.6	0	0	0	-	0	0	0	-	-
100	2313 Manufacture of hollow glass	2.63	0	0	0	-	0	0	0	-	-
101	2314 Manufacture of glass fibres	0.05	0	0	0	-	0	0	0	-	-
102	2319 Manufacture and processing of other glass, including technical glassware	2.52	0	0	0	-	0	0	0	-	-
103	2320 Manufacture of refractory products	2.9	0	0	0	-	0	0	0	-	-
104	2331 Manufacture of ceramic tiles and flags	53.47	0	0	0	-	0	0	0	-	-
105	2332 Manufacture of bricks, tiles and construction products, in baked clay	1.11	0	0	0	-	0	0	0	-	-
106	2342 Manufacture of ceramic sanitary fixtures	44.63	0	0	0	-	0	0	0	-	-
107	2344 Manufacture of other technical ceramic products	2.15	0	0	0	-	0	0	0	-	-
108	2349 Manufacture of other ceramic products	4.36	0	0	0	-	0	0	0	-	-
109	2351 Manufacture of cement	55.16	1.17	0	0	-	0	0	0	-	-
110	2352 Manufacture of lime and plaster	6.84	0	0	0	-	0	0	0	-	-
111	2361 Manufacture of concrete products for construction purposes	0.11	0	0	0	-	0	0	0	-	-
112	2363 Manufacture of ready-mixed concrete	3.78	0	0	0	-	0	0	0	-	-
113	2364 Manufacture of mortars	0.02	0	0	0	-	0	0	0	-	-
114	2369 Manufacture of other articles of concrete, plaster and cement	0.12	0	0	0	-	0	0	0	-	-
115	2370 Cutting, shaping and finishing of stone	8.86	0	0	0	-	0	0	0	-	-
116	2399 Manufacture of other non-metallic mineral products n.e.c.	5.74	0	0	0	-	0	0	0	-	-
117	2410 Manufacture of basic iron and steel and of ferroalloys	56.32	8.18	0	0	-	0	0	0	-	-
118	2420 Manufacture of tubes, pipes, hollow profiles and related fittings, of steel	28.03	0.23	0	0	-	0	0	0	-	-
119	2431 Cold drawing of bars	0.01	0	0	0	-	0	0	0	-	-
120	2432 Cold rolling of narrow strip	19.92	0	0	0	-	0	0	0	-	-
121	2433 Cold forming or folding	0.07	0	0	0	-	0	0	0	-	-
122	2434 Cold drawing of wire	0.09	0	0	0	-	0	0	0	-	-
123	2442 Aluminium production	37.59	0	0	0	-	0	0	0	-	-
124	2445 Other nonferrous metal production	381.3	287.52	0	0	-	0	0	0	-	-
125	2446 Processing of nuclear fuel	40	0	0	0	-	0	0	0	-	-
126	2451 Casting of iron	3.56	0	0	0	-	0	0	0	-	-
127	2452 Casting of steel	10.42	0	0	0	-	0	0	0	-	-
128	2453 Casting of light metals	4.47	0	0	0	-	0	0	0	-	-
129	2454 Casting of other nonferrous metals	0.41	0	0	0	-	0	0	0	-	-
130	2511 Manufacture of metal structures and parts of structures	63.78	0	0	0	-	0	0	0	-	-
131	2512 Manufacture of doors and windows of metal	0.86	0	0	0	-	0	0	0	-	-
132	2521 Manufacture of central heating radiators and boilers	0	0	0	0	-	0	0	0	-	-

133	2529 Manufacture of other tanks, reservoirs and containers of metal	1.7	0	0	0	-	0	0	0	-	-
134	2540 Manufacture of weapons and ammunition	2.08	0	0	0	-	0	0	0	-	-
135	2550 Forging, pressing, stamping and rollforming of metal; powder metallurgy	78	0.95	0	0	-	0	0	0	-	-
136	2561 Treatment and coating of metals	9.43	0	0	0	-	0	0	0	-	-
137	2562 Machining	4.65	0	0	0	-	0	0	0	-	-
138	2571 Manufacture of cutlery	0.03	0	0	0	-	0	0	0	-	-
139	2572 Manufacture of locks and hinges	1.84	0	0	0	-	0	0	0	-	-
140	2592 Manufacture of light metal packaging	14.69	0	0	0	-	0	0	0	-	-
141	2593 Manufacture of wire products, chain and springs	3.58	0	0	0	-	0	0	0	-	-
142	2594 Manufacture of fasteners and screw machine products	1.63	0	0	0	-	0	0	0	-	-
143	2599 Manufacture of other fabricated metal products n.e.c.	16.51	0	0	0	-	0	0	0	-	-
144	2611 Manufacture of electronic components	4.65	0	0	0	-	0	0	0	-	-
145	2612 Manufacture of loaded electronic boards	0.7	0	0	0	-	0	0	0	-	-
146	2620 Repair of computers and peripheral equipment	0	0	0	0	-	0	0	0	-	-
147	2630 Manufacture of communication equipment	0	0	0	0	-	0	0	0	-	-
148	2651 Manufacture of instruments and appliances for measuring, testing and navigation	0.07	0	0	0	-	0	0	0	-	-
149	2652 Manufacture of watches and clocks	3.94	0	0	0	-	0	0	0	-	-
150	2660 Manufacture of irradiation, electromedical and electrotherapeutic equipment	3.75	0	0	0	-	0	0	0	-	-
151	2670 Manufacture of optical instruments and photographic equipment	0.04	0	0	0	-	0	0	0	-	-
152	2711 Manufacture of electric motors, generators and transformers	95.29	0	0	0	-	0	0	0	-	-
153	2712 Manufacture of electricity distribution and control apparatus	3.71	0	0	0	-	0	0	0	-	-
154	2720 Manufacture of batteries and accumulators	0.02	0	0	0	-	0	0	0	-	-
155	2732 Manufacture of other electronic and electric wires and cables	11.14	0	0	0	-	0	0	0	-	-
156	2740 Manufacture of electric lighting equipment	0.01	0	0	0	-	0	0	0	-	-
157	2751 Manufacture of electric domestic appliances	1.48	0	0	0	-	0	0	0	-	-
158	2790 Manufacture of other electrical equipment	14.86	0.12	0	0	-	0	0	0	-	-
159	2811 Manufacture of engines and turbines, except aircraft, vehicle and cycle engines	0.04	0	0	0	-	0	0	0	-	-
160	2813 Manufacture of other pumps and compressors	0	0	0	0	-	0	0	0	-	-
161	2815 Manufacture of bearings, gears, gearing and driving elements	6.68	0	0	0	-	0	0	0	-	-
162	2822 Manufacture of lifting and handling equipment	13.63	0	0	0	-	0	0	0	-	-
163	2825 Manufacture of nondomestic cooling and ventilation equipment	78	0	0	0	-	0	0	0	-	-
164	2829 Manufacture of other general purpose machinery n.e.c.	3.98	0	0	0	-	0	0	0	-	-
165	2830 Manufacture of agricultural and forestry machinery	1.99	0	0	0	-	0	0	0	-	-
166	2841 Manufacture of metal forming machinery	17.83	0	0	0	-	0	0	0	-	-
167	2849 Manufacture of other machine tools	1.89	0	0	0	-	0	0	0	-	-
168	2891 Manufacture of machinery for metallurgy	0.26	0	0	0	-	0	0	0	-	-
169	2892 Manufacture of machinery for mining, quarrying and construction	4.96	0	0	0	-	0	0	0	-	-
170	2893 Manufacture of machinery for food, beverage and tobacco processing	0	0	0	0	-	0	0	0	-	-
171	2894 Manufacture of machinery for textile, apparel and leather production	0.96	0	0	0	-	0	0	0	-	-
172	2895 Manufacture of machinery for paper and paperboard production	0.19	0	0	0	-	0	0	0	-	-
173	2896 Manufacture of plastics and rubber machinery	5.35	0	0	0	-	0	0	0	-	-
174	2899 Manufacture of other special purpose machinery n.e.c.	7.98	0	0	0	-	0	0	0	-	-
175	2910 Manufacture of motor vehicles	43.72	0	0	0	-	0	0	0	-	-
176	2920 Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and semitrailers	2.35	0	0	0	-	0	0	0	-	-
177	2931 Manufacture of electrical and electronic equipment for motor vehicles	1.36	0	0	0	-	0	0	0	-	-
178	2932 Manufacture of other parts and accessories for motor vehicles	329.51	2.3	0	0	-	0	0	0	-	-
179	3011 Building of ships and floating structures	4.21	1.1	0	0	-	0	0	0	-	-
180	3020 Manufacture of railway locomotives and rolling stock	46.29	14.79	0	0	-	0	0	0	-	-
181	3030 Manufacture of air and spacecraft and related machinery	72.53	0	0	0	-	0	0	0	-	-
182	3040 Manufacture of military fighting vehicles	0.1	0	0	0	-	0	0	0	-	-
183	3101 Manufacture of office and shop furniture	0.98	0	0	0	-	0	0	0	-	-
184	3102 Manufacture of kitchen furniture	1.55	0	0	0	-	0	0	0	-	-
185	3103 Manufacture of mattresses	2.3	0	0	0	-	0	0	0	-	-
186	3109 Manufacture of other furniture	0.04	0	0	0	-	0	0	0	-	-
187	3250 Manufacture of medical and dental instruments and supplies	5.87	0	0	0	-	0	0	0	-	-
188	3299 Other manufacturing n.e.c.	4.31	0	0	0	-	0	0	0	-	-

189	3312 Repair of machinery	0.43	0	0	0	-	0	0	0	-	-
190	3314 Repair of electrical equipment	0	0	0	0	-	0	0	0	-	-
191	3317 Repair and maintenance of other transport equipment	0.49	0.01	0	0	-	0	0	0	-	-
192	3319 Repair of other equipment	0	0	0	0	-	0	0	0	-	-
193	3320 Installation of industrial machinery and equipment	4.39	0.23	0	0	-	0	0	0	-	-
194	3511 Production of electricity	461.94	128.25	0	0	-	0	0	0	-	-
195	3512 Transmission of electricity	11.39	0	0	0	-	0	0	0	-	-
196	3513 Distribution of electricity	260.39	191.48	0	0	-	0	0	0	-	-
197	3514 Trade of electricity	12.04	3.4	0	0	-	0	0	0	-	-
198	3521 Manufacture of gas	104.12	41.49	0	0	-	0	0	0	-	-
199	3522 Distribution of gaseous fuels through mains	251.37	185.89	0	0	-	0	0	0	-	-
200	3523 Trade of gas through mains	5.8	0	0	0	-	0	0	0	-	-
201	3600 Water collection, treatment and supply		121.2 11.65 0		0	-	0	0	0	-	-
202	3700 Sewerage	11.22 4.57		0	0	-	0	0	0	-	-
203	3811 Collection of non-hazardous waste	22.27 0		0	0	-	0	0	0	-	-
204	3821 Treatment and disposal of non-hazardous waste	47.48 0		0	0	-	0	0	0	-	-
205	3822 Treatment and disposal of hazardous waste	0.1	0	0	0	-	0	0	0	-	-
206	3831 Dismantling of wrecks	15.37 0		0	0	-	0	0	0	-	-
207	3832 Recovery of sorted materials	6.5	4.7	0	0	-	0	0	0	-	-
208	3900 Remediation activities and other waste management services	0.73	0	0	0	-	0	0	0	-	-
209	4110 Development of building projects	105.6 0		0	0	-	0	0	0	-	-
210	4120 Construction of residential and non-residential buildings	65.79 0		0	0	-	0	0	0	-	-
211	4211 Construction of roads and motorways	89.95 4.43		0	0	-	0	0	0	-	-
212	4212 Construction of railways and underground railways		322.4 183.2 0		0	-	0	0	0	-	-
213	4213 Construction of bridges and tunnels		31.21 18.98 0		0	-	0	0	0	-	-
214	4222 Construction of utility projects for electricity and telecommunications	11.16 0		0	0	-	0	0	0	-	-
215	4291 Construction of water projects	0.43	0	0	0	-	0	0	0	-	-
216	4299 Construction of other civil engineering projects n.e.c.		196.4 19.28 0		0	-	0	0	0	-	-
217	4311 Demolition	0	0	0	0	-	0	0	0	-	-
218	4312 Site preparation	0	0	0	0	-	0	0	0	-	-
219	4321 Electrical installation	198.1 0		0	0	-	0	0	0	-	-
220	4322 Plumbing, heat and airconditioning installation	44.4	0	0	0	-	0	0	0	-	-
221	4329 Other construction installation
222	4331 Plastering	0.1	0	0	0	-	0	0	0	-	-
		0	0	0	0	-	0	0	0	-	-
223	4333 Floor and wall covering	1.85	0	0	0	-	0	0	0	-	-
224	4334 Painting and glazing	0.07	0	0	0	-	0	0	0	-	-
225	4339 Other building completion and finishing	0.29	0	0	0	-	0	0	0	-	-
226	4399 Other specialised construction activities n.e.c.	104.7 6		0	0	-	0	0	0	-	-
227	4511 Sale of cars and light motor vehicles	36.05 0		0	0	-	0	0	0	-	-
228	4519 Sale of other motor vehicles	3.43	0	0	0	-	0	0	0	-	-
229	4520 Maintenance and repair of motor vehicles	0.14	0	0	0	-	0	0	0	-	-
230	4531 Wholesale trade of motor vehicle parts and accessories	1.61	0	0	0	-	0	0	0	-	-
231	4532 Retail trade of motor vehicle parts and accessories	1.37	0	0	0	-	0	0	0	-	-
232	4540 Sale, maintenance and repair of motorcycles and related parts and accessories	0.59	0.51	0	0	-	0	0	0	-	-
233	4611 Agents involved in the sale of agricultural raw materials, live animals, textile raw materials and semifinished goods	0.2	0	0	0	-	0	0	0	-	-
234	4612 Agents involved in the sale of fuels, ores, metals and industrial chemicals	1.95	0	0	0	-	0	0	0	-	-
235	4613 Agents involved in the sale of timber and building materials	2.16	0	0	0	-	0	0	0	-	-
236	4614 Agents involved in the sale of machinery, industrial equipment, ships and aircraft	4.78	0	0	0	-	0	0	0	-	-
237	4615 Agents involved in the sale of furniture, household goods, hardware and ironmongery	6.5	0	0	0	-	0	0	0	-	-
238	4617 Agents involved in the sale of food, beverages and tobacco	6.62	0	0	0	-	0	0	0	-	-
239	4619 Agents involved in the sale of a variety of goods	12.49 0		0	0	-	0	0	0	-	-
240	4621 Wholesale of grain, unmanufactured tobacco, seeds and animal feeds	42.95 0		0	0	-	0	0	0	-	-
241	4623 Wholesale of live animals	1.49	0	0	0	-	0	0	0	-	-
242	4624 Wholesale of hides, skins and leather	3.14	0	0	0	-	0	0	0	-	-
243	4631 Wholesale of fruit and vegetables	51.83 0		0	0	-	0	0	0	-	-
244	4632 Wholesale of meat and meat products	30.52 0		0	0	-	0	0	0	-	-

245	4633 Wholesale of dairy products, eggs and edible oils and fats	47.67	0	0	0	-	0	0	0	-	-
246	4634 Wholesale of beverages	14.35	0	0	0	-	0	0	0	-	-
247	4635 Wholesale of tobacco products	0	0	0	0	-	0	0	0	-	-
248	4636 Wholesale of sugar and chocolate and sugar confectionery	3.46	0	0	0	-	0	0	0	-	-
249	4637 Wholesale of coffee, tea, cocoa and spices	0.94	0	0	0	-	0	0	0	-	-
250	4638 Wholesale of other food, including fish, crustaceans and molluscs	45.85	0	0	0	-	0	0	0	-	-
251	4639 Nonspecialised wholesale of food, beverages and tobacco	78.74	0	0	0	-	0	0	0	-	-
252	4641 Wholesale of textiles	0.34	0	0	0	-	0	0	0	-	-
253	4642 Wholesale of clothing and footwear	43.72	0	0	0	-	0	0	0	-	-
254	4643 Wholesale of electrical household appliances	29.75	0	0	0	-	0	0	0	-	-
255	4644 Wholesale of china and glassware and cleaning materials	1.59	0	0	0	-	0	0	0	-	-
256	4645 Wholesale of perfume and cosmetics	324.4	0	0	0	-	0	0	0	-	-
257	4646 Wholesale of pharmaceutical goods	93.54	0	0	0	-	0	0	0	-	-
258	4648 Wholesale of watches and jewellery	0.08	0	0	0	-	0	0	0	-	-
259	4649 Wholesale of other household goods	4.71	0	0	0	-	0	0	0	-	-
260	4651 Wholesale of computers, computer peripheral equipment and software	12.39	0	0	0	-	0	0	0	-	-
261	4652 Wholesale of electronic and telecommunications equipment and parts	3.34	0	0	0	-	0	0	0	-	-
262	4661 Wholesale of agricultural machinery, equipment and supplies	0.05	0	0	0	-	0	0	0	-	-
263	4662 Wholesale of machine tools	0.13	0	0	0	-	0	0	0	-	-
264	4663 Wholesale of mining, construction and civil engineering machinery	0.18	0	0	0	-	0	0	0	-	-
265	4665 Wholesale of office furniture	6.16	0	0	0	-	0	0	0	-	-
266	4666 Wholesale of other office machinery and equipment	9.93	0	0	0	-	0	0	0	-	-
267	4669 Wholesale of other machinery and equipment	35.06	0	0	0	-	0	0	0	-	-
268	4671 Wholesale of solid, liquid and gaseous fuels and related products	14.29	0	0	0	-	0	0	0	-	-
269	4672 Wholesale of metals and metal ores		120.8 25.08	0	0	-	0.11	0	0	-	-
270	4673 Wholesale of wood, construction materials and sanitary equipment	114.9	0	0	0	-	0	0	0	-	-
271	4674 Wholesale of hardware, plumbing and heating equipment and supplies	47.59	0	0	0	-	0	0	0	-	-
272	4675 Wholesale of chemical products	33.26	0	0	0	-	0	0	0	-	-
273	4676 Wholesale of other intermediate products	52.03	0	0	0	-	0	0	0	-	-
274	4677 Wholesale of waste and scrap	0.83	0	0	0	-	0	0	0	-	-
275	4690 Nonspecialised wholesale trade	16.77	0	0	0	-	0	0	0	-	-
276	4711 Retail sale in nonspecialised stores with food, beverages or tobacco predominating	433.5	0	0	0	-	0	0	0	-	-
277	4719 Other retail sale in nonspecialised stores	163.8 1.66		0	0	-	0	0	0	-	-
278	4721 Retail sale of fruit and vegetables in specialised stores	15.73	0	0	0	-	0	0	0	-	-
279	4722 Retail sale of meat and meat products in specialised stores	6.61	0	0	0	-	0	0	0	-	-
280	4724 Retail sale of bread, cakes, flour confectionery and sugar confectionery in specialised stores	0.32	0	0	0	-	0	0	0	-	-
281	4729 Other retail sale of food in specialised stores	29.34	0	0	0	-	0	0	0	-	-
282	4730 Retail sale of automotive fuel in specialised stores	47.17 0.04		0	0	-	0	0	0	-	-
283	4741 Retail sale of computers, peripheral units and software in specialised stores	0.69	0	0	0	-	0	0	0	-	-
284	4742 Retail sale of telecommunications equipment in specialised stores	7.44	0	0	0	-	0	0	0	-	-
285	4751 Retail sale of textiles in specialised stores	0	0	0	0	-	0	0	0	-	-
286	4752 Retail sale of hardware, paints and glass in specialised stores	36.63	0	0	0	-	0	0	0	-	-
287	4759 Retail sale of furniture, lighting equipment and other household articles in specialised stores	18.58	0	0	0	-	0	0	0	-	-
288	4761 Retail sale of books in specialised stores	0.15	0	0	0	-	0	0	0	-	-
289	4764 Retail sale of sporting equipment in specialised stores	1.71	0	0	0	-	0	0	0	-	-
290	4765 Retail sale of games and toys in specialised stores	0.03	0	0	0	-	0	0	0	-	-
291	4771 Retail sale of clothing in specialised stores	107.0 0.19		0	0	-	0	0	0	-	-
292	4772 Retail sale of footwear and leather goods in specialised stores	1.96	0	0	0	-	0	0	0	-	-
293	4773 Dispensing chemist in specialised stores	0.05	0	0	0	-	0	0	0	-	-
294	4774 Retail sale of medical and orthopaedic goods in specialised stores	0.09	0	0	0	-	0	0	0	-	-
295	4775 Retail sale of cosmetic and toilet articles in specialised stores	35.39	0	0	0	-	0	0	0	-	-
296	4776 Retail sale of flowers, plants, seeds, fertilisers, pet animals and pet food in specialised stores	0.93	0	0	0	-	0	0	0	-	-
297	4777 Retail sale of watches and jewellery in specialised stores	0.68	0	0	0	-	0	0	0	-	-
298	4778 Other retail sale of new goods in specialised stores	100.6	0	0	0	-	0	0	0	-	-
299	4781 Retail sale via stalls and markets of food, beverages and tobacco products	3.46	0	0	0	-	0	0	0	-	-
300	4791 Retail sale via mail order houses or via Internet	2.12	0	0	0	-	0	0	0	-	-

301	4799 Other retail sale not in stores, stalls or markets	3.99	0	0	0	-	0	0	0	-	-
302	4910 Passenger rail transport, interurban	405	5.71	0	0	-	0	0	0	-	-
303	4920 Freight rail transport	0.01	0	0	0	-	0	0	0	-	-
304	4931 Urban and suburban passenger land transport	156.4	0	0	0	-	0	0	0	-	-
305	4932 Taxi operation	0.6	0	0	0	-	0	0	0	-	-
306	4939 Other passenger land transport n.e.c.	37.58	0	0	0	-	0	0	0	-	-
307	4941 Freight transport by road	67.63	0	0	0	-	0	0	0	-	-
308	4950 Transport via pipeline	26.07	0	0	0	-	0	0	0	-	-
309	5010 Sea and coastal passenger water transport	19.72	0	0	0	-	0	0	0	-	-
310	5020 Sea and coastal freight water transport	47.19	0	0	0	-	0	0	0	-	-
311	5110 Passenger air transport	5.42	0	0	0	-	0	0	0	-	-
312	5121 Freight air transport	0	0	0	0	-	0	0	0	-	-
313	5210 Warehousing and storage	7.63	0	0	0	-	0	0	0	-	-
314	5221 Service activities incidental to land transportation	281.1 5.54		0	0	-	0	0	0	-	-
315	5222 Service activities incidental to water transportation	109.3	0	0	0	-	0	0	0	-	-
316	5223 Service activities incidental to air transportation		360.7 55.32	0	0	-	0	0	0	-	-
317	5224 Cargo handling	0.29	0	0	0	-	0	0	0	-	-
318	5229 Other transportation support activities	36.44	0	0	0	-	0	0	0	-	-
319	5310 Postal activities under universal service obligation	48.1	0	0	0	-	0	0	0	-	-
320	5320 Other postal and courier activities	12.57	0	0	0	-	0	0	0	-	-
321	5510 Hotels and similar accommodation	676.7	0	0	0	-	0	0	0	-	-
322	5520 Holiday and other short-stay accommodation	22.86	0	0	0	-	0	0	0	-	-
323	5530 Camping grounds, recreational vehicle parks and trailer parks	1.25	0	0	0	-	0	0	0	-	-
324	5590 Other accommodation	1.02	0	0	0	-	0	0	0	-	-
325	5610 Restaurants and mobile food service activities	92.67	0	0	0	-	0	0	0	-	-
326	5621 Event catering activities	0.24	0	0	0	-	0	0	0	-	-
327	5629 Other food service activities	0.94	0	0	0	-	0	0	0	-	-
328	5630 Beverage serving activities	2.93	0	0	0	-	0	0	0	-	-
329	5811 Book publishing	1.39	0	0	0	-	0	0	0	-	-
330	5813 Publishing of newspapers	3.93	0	0	0	-	0	0	0	-	-
331	5819 Other publishing activities	5.06	0	0	0	-	0	0	0	-	-
332	5821 Publishing of computer games	20.1	0	0	0	-	0	0	0	-	-
333	5829 Other software publishing	0.43	0	0	0	-	0	0	0	-	-
334	5912 Motion picture, video and television programme postproduction activities	9.5	0	0	0	-	0	0	0	-	-
335	6010 Radio broadcasting	0.01	0	0	0	-	0	0	0	-	-
336	6020 Television programming and broadcasting activities	8.44	0.1	0	0	-	0.02	0	0	-	-
337	6110 Wired telecommunications activities	289.9 0.55		0	0	-	0	0	0	-	-
338	6120 Wireless telecommunications activities	0.23	0	0	0	-	0	0	0	-	-
339	6130 Satellite telecommunications activities	0.09	0	0	0	-	0	0	0	-	-
340	6190 Other telecommunications activities	401.6 0.6		0	0	-	0.12	0	0	-	-
341	6201 Computer programming activities	8.19	0.04	0	0	-	0	0	0	-	-
342	6202 Computer consultancy activities	27.35	0	0	0	-	0.21	0	0	-	-
343	6203 Computer facilities management activities	1.34	0	0	0	-	0	0	0	-	-
344	6209 Other information technology and computer service activities	19.1	0.01	0	0	-	0	0	0	-	-
345	6311 Data processing, hosting and related activities	3.3	0	0	0	-	0	0	0	-	-
346	6312 Web portals	0.17	0	0	0	-	0	0	0	-	-
347	6391 News agency activities	0	0	0	0	-	0	0	0	-	-
348	6399 Other information service activities n.e.c.	0	0	0	0	-	0	0	0	-	-
349	6420 Activities of holding companies	765.7 0.86		0	0	-	0.06	0	0	-	-
350	6499 Other financial service activities, except insurance and pension funding n.e.c.		149.2 75.97	0	0	-	0	0	0	-	-
351	6612 Security and commodity contracts brokerage	0.2	0	0	0	-	0	0	0	-	-
352	6619 Other activities auxiliary to financial services, except insurance and pension funding		332.4 266.1	0	0	-	0	0	0	-	-
353	6622 Activities of insurance agents and brokers	0.84	0.01	0	0	-	0	0	0	-	-
354	6810 Buying and selling of own real estate	74.96	0	0	0	-	0	0	0	-	-
355	6820 Renting and operating of own or leased real estate	347.7 4.68		0	0	-	2.62	0	0	-	-
356	6831 Real estate agencies	0.95	0	0	0	-	0	0	0	-	-

357	6832 Management of real estate on a fee or contract basis	38.6	0.04	0	0	-	0.02	0	0	-	-
358	6910 Legal activities	7.59	0	0	0	-	0	0	0	-	-
359	6920 Accounting, bookkeeping and auditing activities; tax consultancy	21.83 0		0	0	-	0	0	0	-	-
360	7010 Activities of head offices		256.8 10.71 0		0	-	0.05	0	0	-	-
361	7021 Public relations and communication activities	0	0	0	0	-	0	0	0	-	-
362	7022 Business and other management consultancy activities	70.45 0		0	0	-	0	0	0	-	-
363	7111 Architectural activities	0.25	0	0	0	-	0	0	0	-	-
364	7112 Engineering activities and related technical consultancy	104.8 0.01		0	0	-	0	0	0	-	-
365	7120 Technical testing and analysis	15.45 0		0	0	-	0	0	0	-	-
366	7219 Other research and experimental development on natural sciences and engineering	2.01	0	0	0	-	0	0	0	-	-
367	7220 Research and experimental development on social sciences and humanities	0.79	0	0	0	-	0	0	0	-	-
368	7311 Advertising agencies	16.72 0		0	0	-	0	0	0	-	-
369	7312 Media representation	0	0	0	0	-	0	0	0	-	-
370	7320 Market research and public opinion polling	1.5	0	0	0	-	0	0	0	-	-
371	7410 Specialised design activities	0.01	0	0	0	-	0	0	0	-	-
372	7420 Photographic activities	0.11	0.02	0	0	-	0	0	0	-	-
373	7490 Other professional, scientific and technical activities n.e.c.	51.56 2.22		0	0	-	0.1	0	0	-	-
374	7500 Veterinary activities	3.26	0	0	0	-	0	0	0	-	-
375	7711 Renting and leasing of cars and light motor vehicles	24.79 0		0	0	-	0	0	0	-	-
376	7712 Renting and leasing of trucks	3.68	0	0	0	-	0	0	0	-	-
377	7732 Renting and leasing of construction and civil engineering machinery and equipment	12.91 0		0	0	-	0	0	0	-	-
378	7734 Renting and leasing of water transport equipment	1.21	0	0	0	-	0	0	0	-	-
379	7735 Renting and leasing of air transport equipment	57.81 0		0	0	-	0	0	0	-	-
380	7739 Renting and leasing of other machinery, equipment and tangible goods n.e.c.	84.58 0.1		0	0	-	0.06	0	0	-	-
381	7740 Leasing of intellectual property and similar products, except copyrighted works	0.74	0	0	0	-	0	0	0	-	-
382	7810 Activities of employment placement agencies	0.02	0	0	0	-	0	0	0	-	-
383	7820 Temporary employment agency activities	11.19 0		0	0	-	0	0	0	-	-
384	7830 Other human resources provision	0.01	0	0	0	-	0	0	0	-	-
385	7911 Travel agency activities	11.91 0		0	0	-	0	0	0	-	-
386	7912 Tour operator activities	7.15	0	0	0	-	0	0	0	-	-
387	7990 Other reservation service and related activities	0.01	0	0	0	-	0	0	0	-	-
388	8010 Private security activities	4.65	0	0	0	-	0	0	0	-	-
389	8020 Security systems service activities	5.19	0.02	0	0	-	0	0	0	-	-
390	8110 Combined facilities support activities	12.86 0		0	0	-	0	0	0	-	-
391	8121 General cleaning of buildings	3.74	0.24	0	0	-	0	0	0	-	-
392	8122 Other building and industrial cleaning activities	11.81 0		0	0	-	0	0	0	-	-
393	8129 Other cleaning activities	4.86	0	0	0	-	0	0	0	-	-
394	8130 Landscape service activities	0.08	0	0	0	-	0	0	0	-	-
395	8211 Combined office administrative service activities	1.61	0	0	0	-	0	0	0	-	-
396	8219 Photocopying, document preparation and other specialised office support activities	0.42	0	0	0	-	0	0	0	-	-
397	8220 Activities of call centres	0.84	0	0	0	-	0	0	0	-	-
398	8230 Organisation of conventions and trade shows	3.09	0	0	0	-	0	0	0	-	-
399	8291 Activities of collection agencies and credit bureaus	2.74	0	0	0	-	0	0	0	-	-
400	8292 Packaging activities	0.02	0	0	0	-	0	0	0	-	-
401	8299 Other business support service activities n.e.c.	3.91	0	0	0	-	0	0	0	-	-
402	8411 General public administration activities	573.5 0.43		0	0	-	0	0	0	-	-
403	8412 Regulation of the activities of providing health care, education, cultural services and other social services, excluding social security 0		0	0	0	-	0	0	0	-	-
404	8413 Regulation of and contribution to more efficient operation of businesses	0	0	0	0	-	0	0	0	-	-
405	8520 Primary education	0.04	0	0	0	-	0	0	0	-	-
406	8531 General secondary education	0.2	0	0	0	-	0	0	0	-	-
407	8532 Technical and vocational secondary education	30.01 0		0	0	-	0	0	0	-	-
408	8541 Postsecondary non
409	8552 Cultural education	10.81 0		0	0	-	0	0	0	-	-
		0.91	0	0	0	-	0	0	0	-	-
410	8559 Other education n.e.c.	8.83	0	0	0	-	0	0	0	-	-
411	8560 Educational support activities	2.48	0	0	0	-	0	0	0	-	-
412	8610 Hospital activities	73.86 0		0	0	-	0	0	0	-	-

413	8621 General medical practice activities	10.27 0.57		0	0	-	0	0	0	-	-
414	8622 Specialist medical practice activities	5.08	0.03	0	0	-	0	0	0	-	-
415	8623 Dental practice activities	0	0	0	0	-	0	0	0	-	-
416	8690 Other human health activities	13.67 0		0	0	-	0	0	0	-	-
417	8710 Residential nursing care activities	3.21	0	0	0	-	0	0	0	-	-
418	8720 Residential care activities for mental retardation, mental health and substance abuse	2.01	0.19	0	0	-	0	0	0	-	-
419	8730 Residential care activities for the elderly and disabled	51.48 0		0	0	-	0.01	0	0	-	-
420	8790 Other residential care activities	25.9	0.01	0	0	-	0	0	0	-	-
421	8810 Social work activities without accommodation for the elderly and disabled	0.89	0	0	0	-	0	0	0	-	-
422	8891 Child daycare activities	0.08	0	0	0	-	0	0	0	-	-
423	8899 Other social work activities without accommodation n.e.c.	1.75	0	0	0	-	0	0	0	-	-
424	9004 Operation of arts facilities	0	0	0	0	-	0	0	0	-	-
425	9103 Operation of historical sites and buildings and similar visitor attractions	0.01	0	0	0	-	0	0	0	-	-
426	9104 Botanical and zoological gardens and nature reserves activities	0.01	0	0	0	-	0	0	0	-	-
427	9200 Gambling and betting activities	9.25	0.23	0	0	-	0	0	0	-	-
428	9311 Operation of sports facilities	1.62	0	0	0	-	0	0	0	-	-
429	9312 Activities of sport clubs	0.05	0	0	0	-	0	0	0	-	-
430	9313 Fitness facilities	9.72	0	0	0	-	0	0	0	-	-
431	9319 Other sports activities	0.75	0	0	0	-	0	0	0	-	-
432	9321 Activities of amusement parks and theme parks	1.29	0	0	0	-	0	0	0	-	-
433	9329 Other amusement and recreation activities	0.63	0	0	0	-	0	0	0	-	-
434	9412 Activities of professional membership organisations	0	0	0	0	-	0	0	0	-	-
435	9499 Activities of other membership organisations n.e.c.	1.56	0	0	0	-	0	0	0	-	-
436	9511 Repair of computers and peripheral equipment	0	0	0	0	-	0	0	0	-	-
437	9512 Repair of communication equipment	0	0	0	0	-	0	0	0	-	-
438	9601 Washing and (dry)cleaning of textile and fur products	2.38	0	0	0	-	0	0	0	-	-
439	9602 Hairdressing and other beauty treatment	0.19	0	0	0	-	0	0	0	-	-
440	9603 Funeral and related activities	36.39 0		0	0	-	0.169 0		0	-	-
441	9604 Physical wellbeing activities	0.67	0	0	0	-	0	0	0	-	-
442	9609 Other personal service activities n.e.c.	5.53	0	0	0	-	0	0	0	-	-

			q	r	s	t	u	v	w	x	y	z	aa	ab
				Pollution (PPC)				Biodiversity and ecosystems (BIO)				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Non-financial obligations)	corporations (subject to NFRD disclosure	not subject to NFRD	SMEs and other NFCs	Non-financial obligations)	corporations (subject to NFRD disclosure	not subject to NFRD	SMEs and other NFCs	Non-financial obligations)	corporations (subject to NFRD disclosure	not subject to NFRD	SMEs and other NFCs
			Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount	Carrying [gross]	amount
Breakdown by sector - NACE 4 digits level (code and label)		in million euros	Of which environm entally sustainab le (PPC)	in million euros	Of which environm entally sustainab le (PPC)	in million euros	Of which environm entally sustainab le (BIO)	in million euros	Of which environm entally sustainab le (BIO)	in million euros	Of which environm entally sustainab le (CCM + CCA + WTR + CE + PPC + BIO)	in million euros	Of which environm entally sustainab le (CCM + CCA + WTR + CE + PPC + BIO)
1		111 Growing of cereals (except rice), leguminous crops and oil seeds	-				-				4.15	0	0	0
2		113 Growing of vegetables and melons, roots and tubers	-				-				18.28	0	0	0
3		119 Growing of other nonperennial crops	-				-				1.95	0	0	0
4		122 Growing of tropical and subtropical fruits	-				-				0.71	0	0	0
5		123 Growing of citrus fruits	-				-				30.59	0	0	0
6		124 Growing of pome fruits and stone fruits	-				-				1.78	0	0	0
7		125 Growing of other tree and bush fruits and nuts	-				-				8.83	0	0	0
8		130 Plant propagation	-				-				7.15	0	0	0
9		143 Raising of horses and other equines	-				-				0	0	0	0
10		145 Raising of sheep and goats	-				-				2.24	0	0	0
11		146 Raising of swine/pigs	-				-				38.46	0	0	0
12		147 Raising of poultry	-				-				9.7	0	0	0

13	149 Raising of other animals	-	-	2.08	0	0	0
14	150 Mixed farming	-	-	0.34	0	0	0
15	161 Support activities for crop production	-	-	11.71	0	0	0
16	162 Support activities for animal production	-	-	5	0	0	0
17	210 Silviculture and other forestry activities	-	-	3.45	0	0	0
18	220 Logging	-	-	0.06	0	0	0
19	311 Marine fishing	-	-	11.23	0	0	0
20	321 Marine aquaculture	-	-	4.76	0	0	0
21	610 Extraction of crude petroleum	-	-	38.46	12.33	0	0
22	729 Mining of other nonferrous metal ores	-	-	39.5	0.07	0	0
23	811 Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate	-	-	2.02	0	0	0
24	812 Operation of gravel and sand pits; mining of clays and kaolin	-	-	0.08	0	0	0
25	891 Mining of chemical and fertiliser minerals	-	-	0.01	0	0	0
26	893 Extraction of salt	-	-	0	0	0	0
27	899 Other mining and quarrying n.e.c.	-	-	0.15	0	0	0
28	1011 Processing and preserving of meat	-	-	80.1	0	0	0
29	1012 Processing and preserving of poultry meat	-	-	4.31	0	0	0
30	1013 Production of meat and poultry meat products	-	-	95.8	0	0	0
31	1020 Processing and preserving of fish, crustaceans and molluscs	-	-	54.45	0	0	0
32	1032 Manufacture of fruit and vegetable juice	-	-	15.59	0	0	0
33	1039 Other processing and preserving of fruit and vegetables	-	-	9.33	0	0	0
34	1041 Manufacture of oils and fats	-	-	1.24	0	0	0
35	1051 Operation of dairies and cheese making	-	-	77.83	0	0	0
36	1052 Manufacture of ice cream	-	-	1.22	0	0	0
37	1061 Manufacture of grain mill products	-	-	3.05	0	0	0
38	1071 Manufacture of bread; manufacture of fresh pastry goods and cakes	-	-	80.76	0	0	0
39	1072 Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes	-	-	1.08	0	0	0
40	1073 Manufacture of macaroni, noodles, couscous and similar farinaceous products	-	-	29.25	0	0	0
41	1082 Manufacture of cocoa, chocolate and sugar confectionery	-	-	77.3	0	0	0
42	1084 Manufacture of condiments and seasonings	-	-	7.32	0	0	0
43	1085 Manufacture of prepared meals and dishes	-	-	1.79	0	0	0
44	1086 Manufacture of homogenised food preparations and dietetic food	-	-	1.98	0	0	0
45	1089 Manufacture of other food products n.e.c.	-	-	35.1	0	0	0
46	1091 Manufacture of prepared feeds for farm animals	-	-	91.42	0	0	0
47	1092 Manufacture of prepared pet foods	-	-	8.41	0	0	0
48	1101 Distilling, rectifying and blending of spirits	-	-	0.45	0	0	0
49	1102 Manufacture of wine from grape	-	-	88.09	0	0	0
50	1105 Manufacture of beer	-	-	55.94	0	0	0
51	1106 Manufacture of malt	-	-	0	0	0	0
52	1107 Manufacture of soft drinks; production of mineral waters and other bottled waters	-	-	131.01	0	0	0
53	1310 Preparation and spinning of textile fibres	-	-	2.83	0	0	0
54	1320 Weaving of textiles	-	-	3.47	0	0	0
55	1330 Finishing of textiles	-	-	0.42	0	0	0
56	1391 Manufacture of knitted and crocheted fabrics	-	-	0.01	0	0	0
57	1396 Manufacture of other technical and industrial textiles	-	-	0.85	0	0	0
58	1399 Manufacture of other textiles n.e.c.	-	-	0	0	0	0
59	1412 Manufacture of workwear	-	-	0.37	0	0	0
60	1413 Manufacture of other outerwear	-	-	7.56	0.12	0	0
61	1419 Manufacture of other wearing apparel and accessories	-	-	8.04	0	0	0
62	1431 Manufacture of knitted and crocheted hosiery	-	-	0	0	0	0
63	1511 Tanning and dressing of leather; dressing and dyeing of fur	-	-	5.45	0	0	0
64	1520 Manufacture of footwear	-	-	0.93	0	0	0
65	1610 Sawmilling and planing of wood	-	-	0.13	0	0	0
66	1621 Manufacture of veneer sheets and woodbased panels	-	-	27.36	0	0	0
67	1623 Manufacture of other builders' carpentry and joinery	-	-	7.34	0	0	0
68	1629 Manufacture of other products of wood; manufacture of articles of cork, straw and plaiting materials	-	-	0	0	0	0

69	1711 Manufacture of pulp	-	-	30.89	14.63	0	0
70	1712 Manufacture of paper and paperboard	-	-	47.91	0	0	0
71	1721 Manufacture of corrugated paper and paperboard and of containers of paper and paperboard	-	-	20.04	0	0	0
72	1722 Manufacture of household and sanitary goods and of toilet requisites	-	-	0.01	0	0	0
73	1723 Manufacture of paper stationery	-	-	2.4	0	0	0
74	1811 Printing of newspapers	-	-	0.71	0	0	0
75	1812 Other printing	-	-	0.8	0	0	0
76	1920 Manufacture of refined petroleum products	-	-	123.97	10.49	0	0
77	2011 Manufacture of industrial gases	-	-	0.02	0	0	0
78	2012 Manufacture of dyes and pigments	-	-	1.68	0	0	0
79	2013 Manufacture of other inorganic basic chemicals	-	-	14.78	2.06	0	0
80	2014 Manufacture of other organic basic chemicals	-	-	0.7	0	0	0
81	2015 Manufacture of fertilisers and nitrogen compounds	-	-	21.44	2.71	0	0
82	2016 Manufacture of plastics in primary forms	-	-	8.57	0	0	0
83	2017 Manufacture of synthetic rubber in primary forms	-	-	14.19	0	0	0
84	2020 Manufacture of pesticides and other agrochemical products	-	-	13.79	0	0	0
85	2030 Manufacture of paints, varnishes and similar coatings, printing ink and mastics	-	-	17.85	0	0	0
86	2041 Manufacture of soap and detergents, cleaning and polishing preparations	-	-	5.97	0	0	0
87	2042 Manufacture of perfumes and toilet preparations	-	-	2.39	0	0	0
88	2051 Manufacture of explosives	-	-	72.03	0	0	0
89	2059 Manufacture of other chemical products n.e.c.	-	-	4.39	0	0	0
90	2110 Manufacture of basic pharmaceutical products	-	-	112.87	0	0	0
91	2120 Manufacture of pharmaceutical preparations	-	-	34.79	0	0	0
92	2211 Manufacture of rubber tyres and tubes; retreading and rebuilding of rubber tyres	-	-	10.41	0	0	0
93	2219 Manufacture of other rubber products	-	-	5.6	0	0	0
94	2221 Manufacture of plastic plates, sheets, tubes and profiles	-	-	16.43	0	0	0
95	2222 Manufacture of plastic packing goods	-	-	14.14	0	0	0
96	2223 Manufacture of builders' ware of plastic	-	-	6.09	0	0	0
97	2229 Manufacture of other plastic products	-	-	80.54	0	0	0
98	2311 Manufacture of flat glass	-	-	1.2	0	0	0
99	2312 Shaping and processing of flat glass	-	-	0.6	0	0	0
100	2313 Manufacture of hollow glass	-	-	2.63	0	0	0
101	2314 Manufacture of glass fibres	-	-	0.05	0	0	0
102	2319 Manufacture and processing of other glass, including technical glassware	-	-	2.52	0	0	0
103	2320 Manufacture of refractory products	-	-	2.9	0	0	0
104	2331 Manufacture of ceramic tiles and flags	-	-	53.47	0	0	0
105	2332 Manufacture of bricks, tiles and construction products, in baked clay	-	-	1.11	0	0	0
106	2342 Manufacture of ceramic sanitary fixtures	-	-	44.63	0	0	0
107	2344 Manufacture of other technical ceramic products	-	-	2.15	0	0	0
108	2349 Manufacture of other ceramic products	-	-	4.36	0	0	0
109	2351 Manufacture of cement	-	-	55.16	1.17	0	0
110	2352 Manufacture of lime and plaster	-	-	6.84	0	0	0
111	2361 Manufacture of concrete products for construction purposes	-	-	0.11	0	0	0
112	2363 Manufacture of ready-mixed concrete	-	-	3.78	0	0	0
113	2364 Manufacture of mortars	-	-	0.02	0	0	0
114	2369 Manufacture of other articles of concrete, plaster and cement	-	-	0.12	0	0	0
115	2370 Cutting, shaping and finishing of stone	-	-	8.86	0	0	0
116	2399 Manufacture of other non-metallic mineral products n.e.c.	-	-	5.74	0	0	0
117	2410 Manufacture of basic iron and steel and of ferroalloys	-	-	56.32	8.18	0	0
118	2420 Manufacture of tubes, pipes, hollow profiles and related fittings, of steel	-	-	28.03	0.23	0	0
119	2431 Cold drawing of bars	-	-	0.01	0	0	0
120	2432 Cold rolling of narrow strip	-	-	19.92	0	0	0
121	2433 Cold forming or folding	-	-	0.07	0	0	0
122	2434 Cold drawing of wire	-	-	0.09	0	0	0
123	2442 Aluminium production	-	-	37.59	0	0	0
124	2445 Other nonferrous metal production	-	-	381.3	287.52	0	0

125	2446 Processing of nuclear fuel	-	-	40	0	0	0
126	2451 Casting of iron	-	-	3.56	0	0	0
127	2452 Casting of steel	-	-	10.42	0	0	0
128	2453 Casting of light metals	-	-	4.47	0	0	0
129	2454 Casting of other nonferrous metals	-	-	0.41	0	0	0
130	2511 Manufacture of metal structures and parts of structures	-	-	63.78	0	0	0
131	2512 Manufacture of doors and windows of metal	-	-	0.86	0	0	0
132	2521 Manufacture of central heating radiators and boilers	-	-	0	0	0	0
133	2529 Manufacture of other tanks, reservoirs and containers of metal	-	-	1.7	0	0	0
134	2540 Manufacture of weapons and ammunition	-	-	2.08	0	0	0
135	2550 Forging, pressing, stamping and rollforming of metal; powder metallurgy	-	-	78	0.95	0	0
136	2561 Treatment and coating of metals	-	-	9.43	0	0	0
137	2562 Machining	-	-	4.65	0	0	0
138	2571 Manufacture of cutlery	-	-	0.03	0	0	0
139	2572 Manufacture of locks and hinges	-	-	1.84	0	0	0
140	2592 Manufacture of light metal packaging	-	-	14.69	0	0	0
141	2593 Manufacture of wire products, chain and springs	-	-	3.58	0	0	0
142	2594 Manufacture of fasteners and screw machine products	-	-	1.63	0	0	0
143	2599 Manufacture of other fabricated metal products n.e.c.	-	-	16.51	0	0	0
144	2611 Manufacture of electronic components	-	-	4.65	0	0	0
145	2612 Manufacture of loaded electronic boards	-	-	0.7	0	0	0
146	2620 Repair of computers and peripheral equipment	-	-	0	0	0	0
147	2630 Manufacture of communication equipment	-	-	0	0	0	0
148	2651 Manufacture of instruments and appliances for measuring, testing and navigation	-	-	0.07	0	0	0
149	2652 Manufacture of watches and clocks	-	-	3.94	0	0	0
150	2660 Manufacture of irradiation, electromedical and electrotherapeutic equipment	-	-	3.75	0	0	0
151	2670 Manufacture of optical instruments and photographic equipment	-	-	0.04	0	0	0
152	2711 Manufacture of electric motors, generators and transformers	-	-	95.29	0	0	0
153	2712 Manufacture of electricity distribution and control apparatus	-	-	3.71	0	0	0
154	2720 Manufacture of batteries and accumulators	-	-	0.02	0	0	0
155	2732 Manufacture of other electronic and electric wires and cables	-	-	11.14	0	0	0
156	2740 Manufacture of electric lighting equipment	-	-	0.01	0	0	0
157	2751 Manufacture of electric domestic appliances	-	-	1.48	0	0	0
158	2790 Manufacture of other electrical equipment	-	-	14.86	0.12	0	0
159	2811 Manufacture of engines and turbines, except aircraft, vehicle and cycle engines	-	-	0.04	0	0	0
160	2813 Manufacture of other pumps and compressors	-	-	0	0	0	0
161	2815 Manufacture of bearings, gears, gearing and driving elements	-	-	6.68	0	0	0
162	2822 Manufacture of lifting and handling equipment	-	-	13.63	0	0	0
163	2825 Manufacture of nondomestic cooling and ventilation equipment	-	-	78	0	0	0
164	2829 Manufacture of other general purpose machinery n.e.c.	-	-	3.98	0	0	0
165	2830 Manufacture of agricultural and forestry machinery	-	-	1.99	0	0	0
166	2841 Manufacture of metal forming machinery	-	-	17.83	0	0	0
167	2849 Manufacture of other machine tools	-	-	1.89	0	0	0
168	2891 Manufacture of machinery for metallurgy	-	-	0.26	0	0	0
169	2892 Manufacture of machinery for mining, quarrying and construction	-	-	4.96	0	0	0
170	2893 Manufacture of machinery for food, beverage and tobacco processing	-	-	0	0	0	0
171	2894 Manufacture of machinery for textile, apparel and leather production	-	-	0.96	0	0	0
172	2895 Manufacture of machinery for paper and paperboard production	-	-	0.19	0	0	0
173	2896 Manufacture of plastics and rubber machinery	-	-	5.35	0	0	0
174	2899 Manufacture of other special purpose machinery n.e.c.	-	-	7.98	0	0	0
175	2910 Manufacture of motor vehicles	-	-	43.72	0	0	0
176	2920 Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and semitrailers	-	-	2.35	0	0	0
177	2931 Manufacture of electrical and electronic equipment for motor vehicles	-	-	1.36	0	0	0
178	2932 Manufacture of other parts and accessories for motor vehicles	-	-	329.51	2.3	0	0
179	3011 Building of ships and floating structures	-	-	4.21	1.1	0	0
180	3020 Manufacture of railway locomotives and rolling stock	-	-	46.29	14.79	0	0

181	3030 Manufacture of air and spacecraft and related machinery	-	-	72.53	0	0	0
182	3040 Manufacture of military fighting vehicles	-	-	0.1	0	0	0
183	3101 Manufacture of office and shop furniture	-	-	0.98	0	0	0
184	3102 Manufacture of kitchen furniture	-	-	1.55	0	0	0
185	3103 Manufacture of mattresses	-	-	2.3	0	0	0
186	3109 Manufacture of other furniture	-	-	0.04	0	0	0
187	3250 Manufacture of medical and dental instruments and supplies	-	-	5.87	0	0	0
188	3299 Other manufacturing n.e.c.	-	-	4.31	0	0	0
189	3312 Repair of machinery	-	-	0.43	0	0	0
190	3314 Repair of electrical equipment	-	-	0	0	0	0
191	3317 Repair and maintenance of other transport equipment	-	-	0.49	0.01	0	0
192	3319 Repair of other equipment	-	-	0	0	0	0
193	3320 Installation of industrial machinery and equipment	-	-	4.39	0.23	0	0
194	3511 Production of electricity	-	-	461.94	128.25	0	0
195	3512 Transmission of electricity	-	-	11.39	0	0	0
196	3513 Distribution of electricity	-	-	260.39	191.48	0	0
197	3514 Trade of electricity	-	-	12.04	3.4	0	0
198	3521 Manufacture of gas	-	-	104.12	41.49	0	0
199	3522 Distribution of gaseous fuels through mains	-	-	251.37	185.89	0	0
200	3523 Trade of gas through mains	-	-	5.8	0	0	0
201	3600 Water collection, treatment and supply	-	-	121.24	11.65	0	0
202	3700 Sewerage	-	-	11.22	4.57	0	0
203	3811 Collection of non-hazardous waste	-	-	22.27	0	0	0
204	3821 Treatment and disposal of non-hazardous waste	-	-	47.48	0	0	0
205	3822 Treatment and disposal of hazardous waste	-	-	0.1	0	0	0
206	3831 Dismantling of wrecks	-	-	15.37	0	0	0
207	3832 Recovery of sorted materials	-	-	6.5	4.7	0	0
208	3900 Remediation activities and other waste management services	-	-	0.73	0	0	0
209	4110 Development of building projects	-	-	105.6	0	0	0
210	4120 Construction of residential and non-residential buildings	-	-	65.79	0	0	0
211	4211 Construction of roads and motorways	-	-	89.95	4.43	0	0
212	4212 Construction of railways and underground railways	-	-	322.43	183.25	0	0
213	4213 Construction of bridges and tunnels	-	-	31.21	18.98	0	0
214	4222 Construction of utility projects for electricity and telecommunications	-	-	11.16	0	0	0
215	4291 Construction of water projects	-	-	0.43	0	0	0
216	4299 Construction of other civil engineering projects n.e.c.	-	-	196.41	19.28	0	0
217	4311 Demolition	-	-	0	0	0	0
218	4312 Site preparation	-	-	0	0	0	0
219	4321 Electrical installation	-	-	198.18	0.01	0	0
220	4322 Plumbing, heat and airconditioning installation	-	-	44.4	0	0	0
221	4329 Other construction installation	-	-	0.1	0	0	0
222	4331 Plastering	-	-	0	0	0	0
223	4333 Floor and wall covering	-	-	1.85	0	0	0
224	4334 Painting and glazing	-	-	0.07	0	0	0
225	4339 Other building completion and finishing	-	-	0.29	0	0	0
226	4399 Other specialised construction activities n.e.c.	-	-	104.79	6	0	0
227	4511 Sale of cars and light motor vehicles	-	-	36.05	0	0	0
228	4519 Sale of other motor vehicles	-	-	3.43	0	0	0
229	4520 Maintenance and repair of motor vehicles	-	-	0.14	0	0	0
230	4531 Wholesale trade of motor vehicle parts and accessories	-	-	1.61	0	0	0
231	4532 Retail trade of motor vehicle parts and accessories	-	-	1.37	0	0	0
232	4540 Sale, maintenance and repair of motorcycles and related parts and accessories	-	-	0.59	0.51	0	0
233	4611 Agents involved in the sale of agricultural raw materials, live animals, textile raw materials and semifinished goods	-	-	0.2	0	0	0
234	4612 Agents involved in the sale of fuels, ores, metals and industrial chemicals	-	-	1.95	0	0	0
235	4613 Agents involved in the sale of timber and building materials	-	-	2.16	0	0	0
236	4614 Agents involved in the sale of machinery, industrial equipment, ships and aircraft	-	-	4.78	0	0	0

237	4615 Agents involved in the sale of furniture, household goods, hardware and ironmongery	-	-	6.5	0	0	0
238	4617 Agents involved in the sale of food, beverages and tobacco	-	-	6.62	0	0	0
239	4619 Agents involved in the sale of a variety of goods	-	-	12.49	0	0	0
240	4621 Wholesale of grain, unmanufactured tobacco, seeds and animal feeds	-	-	42.95	0	0	0
241	4623 Wholesale of live animals	-	-	1.49	0	0	0
242	4624 Wholesale of hides, skins and leather	-	-	3.14	0	0	0
243	4631 Wholesale of fruit and vegetables	-	-	51.83	0	0	0
244	4632 Wholesale of meat and meat products	-	-	30.52	0	0	0
245	4633 Wholesale of dairy products, eggs and edible oils and fats	-	-	47.67	0	0	0
246	4634 Wholesale of beverages	-	-	14.35	0	0	0
247	4635 Wholesale of tobacco products	-	-	0	0	0	0
248	4636 Wholesale of sugar and chocolate and sugar confectionery	-	-	3.46	0	0	0
249	4637 Wholesale of coffee, tea, cocoa and spices	-	-	0.94	0	0	0
250	4638 Wholesale of other food, including fish, crustaceans and molluscs	-	-	45.85	0	0	0
251	4639 Nonspecialised wholesale of food, beverages and tobacco	-	-	78.74	0	0	0
252	4641 Wholesale of textiles	-	-	0.34	0	0	0
253	4642 Wholesale of clothing and footwear	-	-	43.72	0	0	0
254	4643 Wholesale of electrical household appliances	-	-	29.75	0	0	0
255	4644 Wholesale of china and glassware and cleaning materials	-	-	1.59	0	0	0
256	4645 Wholesale of perfume and cosmetics	-	-	324.42	0	0	0
257	4646 Wholesale of pharmaceutical goods	-	-	93.54	0	0	0
258	4648 Wholesale of watches and jewellery	-	-	0.08	0	0	0
259	4649 Wholesale of other household goods	-	-	4.71	0	0	0
260	4651 Wholesale of computers, computer peripheral equipment and software	-	-	12.39	0	0	0
261	4652 Wholesale of electronic and telecommunications equipment and parts	-	-	3.34	0	0	0
262	4661 Wholesale of agricultural machinery, equipment and supplies	-	-	0.05	0	0	0
263	4662 Wholesale of machine tools	-	-	0.13	0	0	0
264	4663 Wholesale of mining, construction and civil engineering machinery	-	-	0.18	0	0	0
265	4665 Wholesale of office furniture	-	-	6.16	0	0	0
266	4666 Wholesale of other office machinery and equipment	-	-	9.93	0	0	0
267	4669 Wholesale of other machinery and equipment	-	-	35.06	0	0	0
268	4671 Wholesale of solid, liquid and gaseous fuels and related products	-	-	14.29	0	0	0
269	4672 Wholesale of metals and metal ores	-	-	120.84	25.19	0	0
270	4673 Wholesale of wood, construction materials and sanitary equipment	-	-	114.93	0	0	0
271	4674 Wholesale of hardware, plumbing and heating equipment and supplies	-	-	47.59	0	0	0
272	4675 Wholesale of chemical products	-	-	33.26	0	0	0
273	4676 Wholesale of other intermediate products	-	-	52.03	0	0	0
274	4677 Wholesale of waste and scrap	-	-	0.83	0	0	0
275	4690 Nonspecialised wholesale trade	-	-	16.77	0	0	0
276	4711 Retail sale in nonspecialised stores with food, beverages or tobacco predominating	-	-	433.56	0	0	0
277	4719 Other retail sale in nonspecialised stores	-	-	163.82	1.66	0	0
278	4721 Retail sale of fruit and vegetables in specialised stores	-	-	15.73	0	0	0
279	4722 Retail sale of meat and meat products in specialised stores	-	-	6.61	0	0	0
280	4724 Retail sale of bread, cakes, flour confectionery and sugar confectionery in specialised stores	-	-	0.32	0	0	0
281	4729 Other retail sale of food in specialised stores	-	-	29.34	0	0	0
282	4730 Retail sale of automotive fuel in specialised stores	-	-	47.17	0.04	0	0
283	4741 Retail sale of computers, peripheral units and software in specialised stores	-	-	0.69	0	0	0
284	4742 Retail sale of telecommunications equipment in specialised stores	-	-	7.44	0	0	0
285	4751 Retail sale of textiles in specialised stores	-	-	0	0	0	0
286	4752 Retail sale of hardware, paints and glass in specialised stores	-	-	36.63	0	0	0
287	4759 Retail sale of furniture, lighting equipment and other household articles in specialised stores	-	-	18.58	0	0	0
288	4761 Retail sale of books in specialised stores	-	-	0.15	0	0	0
289	4764 Retail sale of sporting equipment in specialised stores	-	-	1.71	0	0	0
290	4765 Retail sale of games and toys in specialised stores	-	-	0.03	0	0	0
291	4771 Retail sale of clothing in specialised stores	-	-	107.04	0.19	0	0
292	4772 Retail sale of footwear and leather goods in specialised stores	-	-	1.96	0	0	0

293	4773 Dispensing chemist in specialised stores	-	-	0.05	0	0	0
294	4774 Retail sale of medical and orthopaedic goods in specialised stores	-	-	0.09	0	0	0
295	4775 Retail sale of cosmetic and toilet articles in specialised stores	-	-	35.39	0	0	0
296	4776 Retail sale of flowers, plants, seeds, fertilisers, pet animals and pet food in specialised stores	-	-	0.93	0	0	0
297	4777 Retail sale of watches and jewellery in specialised stores	-	-	0.68	0	0	0
298	4778 Other retail sale of new goods in specialised stores	-	-	100.63	0	0	0
299	4781 Retail sale via stalls and markets of food, beverages and tobacco products	-	-	3.46	0	0	0
300	4791 Retail sale via mail order houses or via Internet	-	-	2.12	0	0	0
301	4799 Other retail sale not in stores, stalls or markets	-	-	3.99	0	0	0
302	4910 Passenger rail transport, interurban	-	-	405	5.71	0	0
303	4920 Freight rail transport	-	-	0.01	0	0	0
304	4931 Urban and suburban passenger land transport	-	-	156.45	0	0	0
305	4932 Taxi operation	-	-	0.6	0	0	0
306	4939 Other passenger land transport n.e.c.	-	-	37.58	0	0	0
307	4941 Freight transport by road	-	-	67.63	0	0	0
308	4950 Transport via pipeline	-	-	26.07	0	0	0
309	5010 Sea and coastal passenger water transport	-	-	19.72	0	0	0
310	5020 Sea and coastal freight water transport	-	-	47.19	0	0	0
311	5110 Passenger air transport	-	-	5.42	0	0	0
312	5121 Freight air transport	-	-	0	0	0	0
313	5210 Warehousing and storage	-	-	7.63	0	0	0
314	5221 Service activities incidental to land transportation	-	-	281.1	5.54	0	0
315	5222 Service activities incidental to water transportation	-	-	109.35	0	0	0
316	5223 Service activities incidental to air transportation	-	-	360.73	55.32	0	0
317	5224 Cargo handling	-	-	0.29	0	0	0
318	5229 Other transportation support activities	-	-	36.44	0	0	0
319	5310 Postal activities under universal service obligation	-	-	48.1	0	0	0
320	5320 Other postal and courier activities	-	-	12.57	0	0	0
321	5510 Hotels and similar accommodation	-	-	676.74	0	0	0
322	5520 Holiday and other short-stay accommodation	-	-	22.86	0	0	0
323	5530 Camping grounds, recreational vehicle parks and trailer parks	-	-	1.25	0	0	0
324	5590 Other accommodation	-	-	1.02	0	0	0
325	5610 Restaurants and mobile food service activities	-	-	92.67	0	0	0
326	5621 Event catering activities	-	-	0.24	0	0	0
327	5629 Other food service activities	-	-	0.94	0	0	0
328	5630 Beverage serving activities	-	-	2.93	0	0	0
329	5811 Book publishing	-	-	1.39	0	0	0
330	5813 Publishing of newspapers	-	-	3.93	0	0	0
331	5819 Other publishing activities	-	-	5.06	0	0	0
332	5821 Publishing of computer games	-	-	20.1	0	0	0
333	5829 Other software publishing	-	-	0.43	0	0	0
334	5912 Motion picture, video and television programme postproduction activities	-	-	9.5	0	0	0
335	6010 Radio broadcasting	-	-	0.01	0	0	0
336	6020 Television programming and broadcasting activities	-	-	8.44	0.13	0	0
337	6110 Wired telecommunications activities	-	-	289.91	0.55	0	0
338	6120 Wireless telecommunications activities	-	-	0.23	0	0	0
339	6130 Satellite telecommunications activities	-	-	0.09	0	0	0
340	6190 Other telecommunications activities	-	-	401.62	0.72	0	0
341	6201 Computer programming activities	-	-	8.19	0.04	0	0
342	6202 Computer consultancy activities	-	-	27.35	0.21	0	0
343	6203 Computer facilities management activities	-	-	1.34	0	0	0
344	6209 Other information technology and computer service activities	-	-	19.1	0.01	0	0
345	6311 Data processing, hosting and related activities	-	-	3.3	0	0	0
346	6312 Web portals	-	-	0.17	0	0	0
347	6391 News agency activities	-	-	0	0	0	0
348	6399 Other information service activities n.e.c.	-	-	0	0	0	0

349	6420 Activities of holding companies	-	-	765.71	0.92	0	0
350	6499 Other financial service activities, except insurance and pension funding n.e.c.	-	-	149.29	75.97	0	0
351	6612 Security and commodity contracts brokerage	-	-	0.2	0	0	0
352	6619 Other activities auxiliary to financial services, except insurance and pension funding	-	-	332.46	266.14	0	0
353	6622 Activities of insurance agents and brokers	-	-	0.84	0.01	0	0
354	6810 Buying and selling of own real estate	-	-	74.96	0	0	0
355	6820 Renting and operating of own or leased real estate	-	-	347.72	7.3	0	0
356	6831 Real estate agencies	-	-	0.95	0	0	0
357	6832 Management of real estate on a fee or contract basis	-	-	38.6	0.06	0	0
358	6910 Legal activities	-	-	7.59	0	0	0
359	6920 Accounting, bookkeeping and auditing activities; tax consultancy	-	-	21.83	0	0	0
360	7010 Activities of head offices	-	-	256.85	10.76	0	0
361	7021 Public relations and communication activities	-	-	0	0	0	0
362	7022 Business and other management consultancy activities	-	-	70.45	0	0	0
363	7111 Architectural activities	-	-	0.25	0	0	0
364	7112 Engineering activities and related technical consultancy	-	-	104.83	0.01	0	0
365	7120 Technical testing and analysis	-	-	15.45	0	0	0
366	7219 Other research and experimental development on natural sciences and engineering	-	-	2.01	0	0	0
367	7220 Research and experimental development on social sciences and humanities	-	-	0.79	0	0	0
368	7311 Advertising agencies	-	-	16.72	0	0	0
369	7312 Media representation	-	-	0	0	0	0
370	7320 Market research and public opinion polling	-	-	1.5	0	0	0
371	7410 Specialised design activities	-	-	0.01	0	0	0
372	7420 Photographic activities	-	-	0.11	0.02	0	0
373	7490 Other professional, scientific and technical activities n.e.c.	-	-	51.56	2.31	0	0
374	7500 Veterinary activities	-	-	3.26	0	0	0
375	7711 Renting and leasing of cars and light motor vehicles	-	-	24.79	0	0	0
376	7712 Renting and leasing of trucks	-	-	3.68	0	0	0
377	7732 Renting and leasing of construction and civil engineering machinery and equipment	-	-	12.91	0	0	0
378	7734 Renting and leasing of water transport equipment	-	-	1.21	0	0	0
379	7735 Renting and leasing of air transport equipment	-	-	57.81	0	0	0
380	7739 Renting and leasing of other machinery, equipment and tangible goods n.e.c.	-	-	84.58	0.16	0	0
381	7740 Leasing of intellectual property and similar products, except copyrighted works	-	-	0.74	0	0	0
382	7810 Activities of employment placement agencies	-	-	0.02	0	0	0
383	7820 Temporary employment agency activities	-	-	11.19	0	0	0
384	7830 Other human resources provision	-	-	0.01	0	0	0
385	7911 Travel agency activities	-	-	11.91	0	0	0
386	7912 Tour operator activities	-	-	7.15	0	0	0
387	7990 Other reservation service and related activities	-	-	0.01	0	0	0
388	8010 Private security activities	-	-	4.65	0	0	0
389	8020 Security systems service activities	-	-	5.19	0.02	0	0
390	8110 Combined facilities support activities	-	-	12.86	0	0	0
391	8121 General cleaning of buildings	-	-	3.74	0.24	0	0
392	8122 Other building and industrial cleaning activities	-	-	11.81	0	0	0
393	8129 Other cleaning activities	-	-	4.86	0	0	0
394	8130 Landscape service activities	-	-	0.08	0	0	0
395	8211 Combined office administrative service activities	-	-	1.61	0	0	0
396	8219 Photocopying, document preparation and other specialised office support activities	-	-	0.42	0	0	0
397	8220 Activities of call centres	-	-	0.84	0	0	0
398	8230 Organisation of conventions and trade shows	-	-	3.09	0	0	0
399	8291 Activities of collection agencies and credit bureaus	-	-	2.74	0	0	0
400	8292 Packaging activities	-	-	0.02	0	0	0
401	8299 Other business support service activities n.e.c.	-	-	3.91	0	0	0
402	8411 General public administration activities	-	-	573.54	0.43	0	0
403	8412 Regulation of the activities of providing health care, education, cultural services and other social services, excluding social security	-	-	0	0	0	0
404	8413 Regulation of and contribution to more efficient operation of businesses	-	-	0	0	0	0

<-- PDF CHUNK SEPARATOR -->

405	8520 Primary education	-	-	0.04	0	0	0
406	8531 General secondary education	-	-	0.2	0	0	0
407	8532 Technical and vocational secondary education	-	-	30.01	0	0	0
408	8541 Postsecondary non	-	-	10.81	0	0	0
409	8552 Cultural education	-	-	0.91	0	0	0
410	8559 Other education n.e.c.	-	-	8.83	0	0	0
411	8560 Educational support activities	-	-	2.48	0	0	0
412	8610 Hospital activities	-	-	73.86	0	0	0
413	8621 General medical practice activities	-	-	10.27	0.57	0	0
414	8622 Specialist medical practice activities	-	-	5.08	0.03	0	0
415	8623 Dental practice activities	-	-	0	0	0	0
416	8690 Other human health activities	-	-	13.67	0	0	0
417	8710 Residential nursing care activities	-	-	3.21	0	0	0
418	8720 Residential care activities for mental retardation, mental health and substance abuse	-	-	2.01	0.19	0	0
419	8730 Residential care activities for the elderly and disabled	-	-	51.48	0.01	0	0
420	8790 Other residential care activities	-	-	25.9	0.01	0	0
421	8810 Social work activities without accommodation for the elderly and disabled	-	-	0.89	0	0	0
422	8891 Child daycare activities	-	-	0.08	0	0	0
423	8899 Other social work activities without accommodation n.e.c.	-	-	1.75	0	0	0
424	9004 Operation of arts facilities	-	-	0	0	0	0
425	9103 Operation of historical sites and buildings and similar visitor attractions	-	-	0.01	0	0	0
426	9104 Botanical and zoological gardens and nature reserves activities	-	-	0.01	0	0	0
427	9200 Gambling and betting activities	-	-	9.25	0.23	0	0
428	9311 Operation of sports facilities	-	-	1.62	0	0	0
429	9312 Activities of sport clubs	-	-	0.05	0	0	0
430	9313 Fitness facilities	-	-	9.72	0	0	0
431	9319 Other sports activities	-	-	0.75	0	0	0
432	9321 Activities of amusement parks and theme parks	-	-	1.29	0
433	9329 Other amusement and recreation activities	-	-	0.63	0
434	9412 Activities of professional membership organisations	-	-	0	0
435	9499 Activities of other membership organisations n.e.c.	-	-	1.56	0
436	9511 Repair of computers and peripheral equipment	-	-	0	0
437	9512 Repair of communication equipment	-	-	0	0
438	9601 Washing and (dry)cleaning of textile and fur products	-	-	2.38	0
439	9602 Hairdressing and other beauty treatment	-	-	0.19	0
440	9603 Funeral and related activities	-	-	36.39	0.17
441	9604 Physical wellbeing activities	-	-	0.67	0
442	9609 Other personal service activities n.e.c.	-	-	5.53	0

3. GAR (%) in terms of stock in relation to turnover and CapEx KPIs

GAR KPI stock - Turnover based

		a	b	c	d	e	f	g	h	i	j	k	l m	af
							Disclosure reference date 31/12/2024
				Climate Change Mitigation (CCM)					Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
				Proportion of total covered assets funding taxonomy relevant					Proportion of total covered assets funding		Proportion of total covered assets funding
					sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)		Proportion
	% (compared to total covered assets in the denominator)			Proportion of total covered assets funding					Proportion of total covered assets			Proportion of total covered assets		of total
				taxonomy relevant sectors (Taxonomy-aligned)					funding taxonomy relevant sectors	(Taxonomy-aligned)		funding taxonomy relevant sectors	(Taxonomy-aligned)	assets
				Of which	Of which transition	Of which			Of which	Of which		Of which	Of which	covered
				UoP	al	enabling			UoP	enabling			UoP enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	70.50%	6.68%	5.88%	0.27%	0.28%	0.02%	—%	—%	—%	—%			51.09%
2	Financial corporations	16.65%	1.20%	—%	0.14%	0.23%	0.05%	0.01%	—%	—%	—%			6.04%
3	Credit institutions	16.81%	1.15%	—%	0.16%	0.11%	0.05%	0.01%	—%	—%	—%			5.48%
4	Loans and advances	18.85%	1.29%	—%	0.17%	0.12%	0.06%	0.01%	—%	—%	—%			4.56%
5	Debt securities, including UoP	6.62%	0.45%	—%	0.09%	0.07%	0.01%	—%	—%	—%	—%			0.92%
6	Equity instruments	15.90%	1.67%		0.02%	0.14%	0.04%	0.02%		0.02%	—%			—%
7	Other financial corporations	15.13%	1.72%	0.01%	0.03%	1.41%	0.02%	0.01%	—%	—%	—%			0.57%
8	of which investment firms	14.65%	1.70%	0.01%	0.03%	1.48%	0.01%	—%	—%	—%	—%			0.54%
9	Loans and advances	16.51%	1.93%	0.01%	0.03%	1.68%	0.01%	—%	—%	—%	—%			0.47%
10	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.02%
11	Equity instruments	1.50%	0.09%	—%		0.02%	0.01%	—%	—%		—%			0.05%
12	of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
13	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
14	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
15	Equity instruments	—%	—%	—%		—%	—%	—%	—%		—%			—%
16	of which insurance undertakings	24.45%	2.12%	—%	0.03%	0.06%	0.20%	0.05%	—%	0.02%	—%			0.03%
17	Loans and advances	38.59%	3.35%	—%	0.05%	0.10%	0.32%	0.08%	—%	0.04%	—%			0.02%
18	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
19	Equity instruments	—%	—%	—%		—%	—%	—%	—%		—%			0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	20.68%	7.72%	2.40%	1.80%	2.07%	0.16%	0.03%	—%	0.02%	0.01%			6.28%
21	Loans and advances	20.01%	7.45%	2.44%	1.83%	1.71%	0.16%	0.03%	—%	0.02%	0.01%			6.18%
22	Debt securities, including UoP	59.36%	23.27%	—%	0.02%	23.11%	—%	—%	—%	—%	—%			0.11%
23	Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
24	Households	88.39%	7.49%	7.49%	0.04%	—%	—%	—%	—%	—%	—%			38.14%
25	of which loans collateralised by residential immovable property	100.00%	8.78%	8.78%	—%	—%	—%	—%	—%	—%	—%			32.32%
26	of which building renovation loans	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.50%
27	of which motor vehicle loans	100.00%	1.88%	1.88%	1.88%	—%	—%							0.89%
28	Local governments financing	0.08%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.62%
29	Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
30	Other local governments financing	0.08%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.62%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.38%
32	Total GAR assets	47.15%	4.42%	3.89%	0.18%	0.19%	0.02%	—%	—%	—%	—%			77.19%

					Disclosure reference date 31/12/2024
			Circular Economy (CE)			Pollution (PPC)			Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding			Proportion of total covered assets funding			Proportion of total covered assets funding
	% (compared to total covered assets in the denominator)		taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)		Proportion
			Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors	of total
			(Taxonomy-aligned)				(Taxonomy-aligned)		(Taxonomy-aligned)	assets
			Of which	Of which		Of which	Of which		Of which	Of which	covered
			UoP	enabling		UoP	enabling		UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	0.01%			0.05%			0.08%			51.09%
2	Financial corporations	—%			—%			—%			6.04%
3	Credit institutions	—%			—%			—%			5.48%
4	Loans and advances	—%			—%			—%			4.56%
5	Debt securities, including UoP	—%			—%			—%			0.92%
6	Equity instruments	—%			—%			—%			—%
7	Other financial corporations	—%			—%			—%			0.57%
8	of which investment firms	—%			—%			—%			0.54%
9	Loans and advances	—%			—%			—%			0.47%
10	Debt securities, including UoP	—%			—%			—%			0.02%
11	Equity instruments	—%			—%			—%			0.05%
12	of which management companies	—%			—%			—%			—%
13	Loans and advances	—%			—%			—%			—%
14	Debt securities, including UoP	—%			—%			—%			—%
15	Equity instruments	—%			—%			—%			—%
16	of which insurance undertakings	—%			—%			—%			0.03%
17	Loans and advances	—%			—%			—%			0.02%
18	Debt securities, including UoP	—%			—%			—%			—%
19	Equity instruments	—%			—%			—%			0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	0.08%			0.40%			0.61%			6.28%
21	Loans and advances	0.08%			0.19%			0.62%			6.18%
22	Debt securities, including UoP	—%			12.38%			—%			0.11%
23	Equity instruments	—%			—%			—%			—%
24	Households	—%			—%			—%			38.14%
25	of which loans collateralised by residential immovable property	—%			—%			—%			32.32%
26	of which building renovation loans	—%			—%			—%			0.50%
27	of which motor vehicle loans	—%			—%			—%			0.89%
28	Local governments financing	—%			—%			—%			0.62%
29	Housing financing	—%			—%			—%			—%
30	Other local governments financing	—%			—%			—%			0.62%
31	Collateral obtained by taking possession: residential and commercial immovable properties	—%			—%			—%			0.38%
32	Total GAR assets	0.01%			0.03%			0.05%			77.19%

			aa	ab ac Disclosure reference date 31/12/2024		ad ae	af
	% (compared to total covered assets in the denominator)		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) Proportion of total covered assets funding taxonomy relevant sectors
						(Taxonomy-aligned)
							assets covered
				Of which UoP	Of which	transitional Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	70.66%	6.69%	5.88%	0.27%	0.28%	51.09%
2	Financial corporations	16.69%	1.21%	—%	0.14%	0.23%	6.04%
3	Credit institutions	16.85%	1.16%	—%	0.16%	0.11%	5.48%
4	Loans and advances	18.91%	1.30%	—%	0.17%	0.12%	4.56%
5	Debt securities, including UoP	6.63%	0.46%	—%	0.09%	0.07%	0.92%
6	Equity instruments	15.94%	1.69%		0.02%	0.16%	—%
7	Other financial corporations	15.15%	1.73%	0.01%	0.03%	1.41%	0.57%
8	of which investment firms	14.65%	1.71%	0.01%	0.03%	1.48%	0.54%
9	Loans and advances	16.52%	1.93%	0.01%	0.03%	1.68%	0.47%
10	Debt securities, including UoP	—%	—%	—%	—%	—%	0.02%
11	Equity instruments	1.51%	0.09%	—%		0.02%	0.05%
12	of which management companies	—%	—%	—%	—%	—%	—%
13	Loans and advances	—%	—%	—%	—%	—%	—%
14	Debt securities, including UoP	—%	—%	—%	—%	—%	—%
15	Equity instruments	—%	—%	—%		—%	—%
16	of which insurance undertakings	24.65%	2.17%	—%	0.03%	0.09%	0.03%
17	Loans and advances	38.90%	3.43%	—%	0.05%	0.14%	0.02%
18	Debt securities, including UoP	—%	—%	—%	—%	—%	—%
19	Equity instruments	—%	—%	—%		—%	0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	21.94%	7.75%	2.40%	1.80%	2.09%	6.28%
21	Loans and advances	21.08%	7.49%	2.44%	1.83%	1.73%	6.18%
22	Debt securities, including UoP	71.74%	23.27%	—%	0.02%	23.11%	0.11%
23	Equity instruments	—%	—%	—%	—%	—%	—%
24	Households	88.39%	7.49%	7.49%	0.04%	—%	38.14%
25	of which loans collateralised by residential immovable property	100.00%	8.78%	8.78%	—%	—%	32.32%
26	of which building renovation loans	100.00%	—%	—%	—%	—%	0.50%
27	of which motor vehicle loans	100.00%	1.88%	1.88%	1.88%	—%	0.89%
28	Local governments financing	0.08%	—%	—%	—%	—%	0.62%
29	Housing financing	—%	—%	—%	—%	—%	—%
30	Other local governments financing	0.08%	—%	—%	—%	—%	0.62%
	Collateral obtained by taking possession: residential and commercial immovable
31 32	properties Total GAR assets	100.00% 47.26%	—% 4.43%	—% 3.89%	—% 0.18%	—% 0.19%	0.38% 77.19%

		ag	ah	ai	aj	ak	al	am	an	ao	ap	aq	ar	as	bk
								Disclosure reference date 31/12/2023
				Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
						Proportion of total covered assets funding taxonomy relevant				Proportion of total covered assets funding	Proportion of total covered assets funding
	% (compared to total covered assets in the denominator)					sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)	taxonomy relevant sectors (Taxonomy-eligible)				Proportion
						Proportion of total covered assets funding				Proportion of total covered assets funding taxonomy relevant sectors	Proportion of total covered assets funding taxonomy relevant sectors				of total
						taxonomy relevant sectors (Taxonomy-aligned)				(Taxonomy-aligned)	(Taxonomy-aligned)				assets
				Of which	Of which transition	Of which			Of which	Of which			Of which	Of which	covered
				UoP	al	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	49.73%	4.33%	—%	0.07%	0.13%	0.18%	0.07%	—%	0.01%					64.79%
2	Financial corporations	—%	—%	—%	—%	—%	—%	—%	—%	—%					4.40%
3	Credit institutions	—%	—%	—%	—%	—%	—%	—%	—%	—%					3.77%
4	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%					3.21%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.56%
6	Equity instruments	—%	—%		—%	—%	—%	—%		—%					0.01%
7	Other financial corporations	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.63%
8	of which investment firms	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.61%
9	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.54%
10	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.04%
11	Equity instruments	—%	—%		—%	—%	—%	—%		—%					0.03%
12	of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
13	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
14	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
15	Equity instruments	—%	—%		—%	—%	—%	—%		—%					—%
16	of which insurance undertakings	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.02%
17	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.01%
18	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
19	Equity instruments	—%	—%		—%	—%	—%	—%		—%					0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	1.18%	0.52%	—%	0.06%	0.13%	0.18%	0.07%	—%	0.01%					8.49%
21	Loans and advances	1.13%	0.48%	—%	0.06%	0.10%	0.18%	0.07%	—%	0.01%					8.38%
22	Debt securities, including UoP	0.05%	0.04%	—%	—%	0.04%	—%	—%	—%	—%					0.11%
23	Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
24	Households	48.54%	3.81%	—%	—%	—%	—%	—%	—%	—%					51.02%
25	of which loans collateralised by residential immovable property	43.26%	3.80%	—%	—%	—%	—%	—%	—%	—%					43.26%
26	of which building renovation loans	0.75%	—%	—%	—%	—%	—%	—%	—%	—%					0.75%
27	of which motor vehicle loans	0.22%	—%	—%	—%	—%	—%								1.04%
28	Local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.88%
29	Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%					—%
30	Other local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%					0.88%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.73%	0.05%	—%	—%	—%	—%	—%	—%	—%					0.73%
32	Total GAR assets	49.73%	4.33%	—%	0.07%	0.13%	0.18%	0.07%	—%	0.01%					64.79%

		at	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bk
							Disclosure reference date 31/12/2023
			Circular Economy (CE)				Pollution (PPC)			Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding				Proportion of total covered assets funding			Proportion of total covered assets funding
	% (compared to total covered assets in the denominator)		taxonomy relevant sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)			Proportion
			funding taxonomy relevant sectors	Proportion of total covered assets			Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors			of total
					(Taxonomy-aligned)			(Taxonomy-aligned)					(Taxonomy-aligned)	assets
				Of which	Of which			Of which	Of which			Of which	Of which	covered
				UoP	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation													64.79%
2	Financial corporations													4.40%
3	Credit institutions													3.77%
4	Loans and advances													3.21%
5	Debt securities, including UoP													0.56%
6	Equity instruments													0.01%
7 8	Other financial corporations of which investment firms													0.63% 0.61%
9	Loans and advances													0.54%
10	Debt securities, including UoP													0.04%
11	Equity instruments													0.03%
12	of which management companies													—%
13	Loans and advances													—%
14	Debt securities, including UoP													—%
15	Equity instruments													—%
16	of which insurance undertakings													0.02%
17	Loans and advances													0.01%
18	Debt securities, including UoP													—%
19	Equity instruments													0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)													8.49%
21	Loans and advances													8.38%
22	Debt securities, including UoP													0.11%
23	Equity instruments													—%
24	Households													51.02%
25	of which loans collateralised by residential immovable property													43.26%
26	of which building renovation loans													0.75%
27	of which motor vehicle loans													1.04%
28	Local governments financing													0.88%
29	Housing financing													—%
30	Other local governments financing													0.88%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties													0.73%
32	Total GAR assets													64.79%

			bf	bg	bh	bi	bj	bk
			Disclosure reference date 31/12/2024 TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
							Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
	% (compared to total covered assets in the denominator)						Proportion of total covered assets funding taxonomy relevant sectors
							(Taxonomy-aligned)	Proportion of total assets covered
					Of which UoP	Of which	transitional Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	49.91%	4.40%	—%	0.07%		0.14%	64.79%
2	Financial corporations	—%	—%	—%	—%		—%	4.40%
3	Credit institutions	—%	—%	—%	—%		—%	3.77%
4	Loans and advances	—%	—%	—%	—%		—%	3.21%
5	Debt securities, including UoP	—%	—%	—%	—%		—%	0.56%
6	Equity instruments	—%	—%		—%		—%	0.01%
7	Other financial corporations	—%	—%	—%	—%		—%	0.63%
8	of which investment firms	—%	—%	—%	—%		—%	0.61%
9	Loans and advances	—%	—%	—%	—%		—%	0.54%
10	Debt securities, including UoP	—%	—%	—%	—%		—%	0.04%
11	Equity instruments	—%	—%		—%		—%	0.03%
12	of which management companies	—%	—%	—%	—%		—%	—%
13	Loans and advances	—%	—%	—%	—%		—%	—%
14	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
15	Equity instruments	—%	—%		—%		—%	—%
16	of which insurance undertakings	—%	—%	—%	—%		—%	0.02%
17	Loans and advances	—%	—%	—%	—%		—%	0.01%
18	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
19	Equity instruments	—%	—%		—%		—%	0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	1.37%	0.59%	—%	0.06%		0.14%	8.49%
21	Loans and advances	1.31%	0.56%	—%	0.06%		0.10%	8.38%
22	Debt securities, including UoP	0.05%	0.04%	—%	—%		0.04%	0.11%
23	Equity instruments	—%	—%	—%	—%		—%	—%
24	Households	48.54%	3.81%	—%	—%		—%	51.02%
25	of which loans collateralised by residential immovable property	43.26%	3.80%	—%	—%		—%	43.26%
26	of which building renovation loans	0.75%	—%	—%	—%		—%	0.75%
27	of which motor vehicle loans	0.22%	—%	—%	—%		—%	1.04%
28	Local governments financing	—%	—%	—%	—%		—%	0.88%
29	Housing financing	—%	—%	—%	—%		—%	—%
30	Other local governments financing	—%	—%	—%	—%		—%	0.88%
	Collateral obtained by taking possession: residential and commercial immovable
31 32	properties Total GAR assets	0.73% 50.63%	0.05% 4.45%	—% —%	—% 0.07%		—% 0.14%	0.73% 64.79%

GAR KPI stock - CapEx based

		a	b	c	d	e		f g	h	i	j	k	l	m	af
							Disclosure reference date 31/12/2024
			Climate Change Mitigation (CCM)						Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
						Proportion of total covered assets funding taxonomy relevant				Proportion of total covered assets funding			Proportion of total covered assets funding
					sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)					taxonomy relevant sectors (Taxonomy-eligible)		Proportion
	% (compared to total covered assets in the denominator)					Proportion of total covered assets funding				Proportion of total covered assets			Proportion of total covered assets		of total
				taxonomy relevant sectors (Taxonomy-aligned)						funding taxonomy relevant sectors (Taxonomy-aligned)		funding taxonomy relevant sectors (Taxonomy-aligned)	assets
				Of which	Of which transition	Of which			Of which	Of which			Of which	Of which	covered
				UoP	al	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	71.21%	7.06%	5.88%	0.30%	0.41%	0.05%	0.01%	—%	—%	—%				51.09%
2	Financial corporations	16.66%	1.40%	—%	0.19%	0.29%	0.04%	0.01%	—%	—%	—%				6.04%
3	Credit institutions	16.89%	1.39%	—%	0.21%	0.19%	0.04%	0.01%	—%	—%	—%				5.48%
4	Loans and advances	18.92%	1.55%	—%	0.23%	0.20%	0.05%	0.01%	—%	—%	—%				4.56%
5	Debt securities, including UoP	6.80%	0.58%	—%	0.12%	0.11%	0.03%	0.01%	—%	—%	—%				0.92%
6	Equity instruments	15.83%	1.76%		0.02%	0.07%	0.04%	0.02%		0.01%	—%				—%
7	Other financial corporations	14.47%	1.51%	0.01%	0.01%	1.32%	0.01%	—%	—%	—%	—%				0.57%
8	of which investment firms	13.88%	1.48%	0.01%	—%	1.38%	—%	—%	—%	—%	—%				0.54%
9	Loans and advances	15.18%	1.68%	0.01%	—%	1.56%	—%	—%	—%	—%	—%				0.47%
10	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.02%
11	Equity instruments	6.33%	0.12%		—%	0.04%	0.01%	—%		—%	—%				0.05%
12	of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
13	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
14	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
15	Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%				—%
16	of which insurance undertakings	25.83%	2.10%	—%	0.03%	0.11%	0.20%	0.05%	—%	0.02%	—%				0.03%
17	Loans and advances	40.77%	3.32%	—%	0.05%	0.17%	0.31%	0.08%	—%	0.03%	—%				0.02%
18	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
19	Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%				0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	26.45%	10.60%	2.40%	1.95%	3.04%	0.37%	0.04%	—%	0.01%	0.02%				6.28%
21	Loans and advances	25.87%	10.32%	2.44%	1.99%	2.62%	0.38%	0.04%	—%	0.01%	0.02%				6.18%
22	Debt securities, including UoP	59.89%	27.05%	—%	—%	27.02%	—%	—%	—%	—%	—%				0.11%
23	Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%				—%
24	Households	88.39%	7.49%	7.49%	0.04%	—%	—%	—%	—%	—%	—%				38.14%
25	of which loans collateralised by residential immovable property	100.00%	8.78%	8.78%	—%	—%	—%	—%	—%	—%	—%				32.32%
26	of which building renovation loans	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.50%
27	of which motor vehicle loans	100.00%	1.88%	1.88%	1.88%	—%	—%	—%	—%	—%	—%				0.89%
28	Local governments financing	0.08%	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.62%
29	Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
30	Other local governments financing	0.08%	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.62%
31	Collateral obtained by taking possession: residential and commercial immovable properties	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.38%
32	Total GAR assets	47.62%	4.67%	3.89%	0.20%	0.27%	0.03%	—%	—%	—%	—%				77.19%

		n	o p	q	r	s	t u	v	w	x	z	af
						Disclosure reference date 31/12/2024
			Circular Economy (CE)		Pollution (PPC)			Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding			Proportion of total covered assets funding			Proportion of total covered assets funding
			taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)			Proportion
	% (compared to total covered assets in the denominator)		Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors		of total
				(Taxonomy-aligned)			(Taxonomy-aligned)				(Taxonomy-aligned)	assets
			Of which	Of which		Of which	Of which			Of which	Of which	covered
			UoP	enabling		UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	0.03%			0.02%			0.08%				51.09%
2	Financial corporations	—%			—%			—%				6.04%
3	Credit institutions	—%			—%			—%				5.48%
4	Loans and advances	—%			—%			—%				4.56%
5	Debt securities, including UoP	—%			—%			—%				0.92%
6	Equity instruments	—%			—%			—%				—%
7	Other financial corporations	—%			—%			—%				0.57%
8	of which investment firms	—%			—%			—%				0.54%
9	Loans and advances	—%			—%			—%				0.47%
10	Debt securities, including UoP	—%			—%			—%				0.02%
11	Equity instruments	—%			—%			—%				0.05%
12	of which management companies	—%			—%			—%				—%
13	Loans and advances	—%			—%			—%				—%
14	Debt securities, including UoP	—%			—%			—%				—%
15	Equity instruments	—%			—%			—%				—%
16	of which insurance undertakings	—%			—%			—%				0.03%
17	Loans and advances	—%			—%			—%				0.02%
18	Debt securities, including UoP	—%			—%			—%				—%
19	Equity instruments	—%			—%			—%				0.01%
20 21	Non-financial corporations (subject to NFRD disclosure obligations) Loans and advances	0.28% 0.28%			0.19% 0.16%			0.66% 0.67%				6.28% 6.18%
22	Debt securities, including UoP	—%			1.70%			—%				0.11%
23	Equity instruments	—%			—%			—%				—%
24	Households	—%			—%			—%				38.14%
25	of which loans collateralised by residential immovable property	—%			—%			—%				32.32%
26	of which building renovation loans	—%			—%			—%				0.50%
27	of which motor vehicle loans	—%			—%			—%				0.89%
28	Local governments financing	—%			—%			—%				0.62%
29	Housing financing	—%			—%			—%				—%
30	Other local governments financing	—%			—%			—%				0.62%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	—%			—%			—%				0.38%
32	Total GAR assets	0.02%			0.02%			0.05%				77.19%

			aa	ab ac	ad Disclosure reference date 31/12/2024	ae	af
			TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
	% (compared to total covered assets in the denominator)			Proportion of total covered assets funding taxonomy relevant sectors
						(Taxonomy-aligned)	Proportion of total
							assets covered
					Of which
				Of which UoP		transitional Of which enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	71.40%	7.06%	5.88%	0.30%	0.41%	51.09%
2	Financial corporations	16.70%	1.41%	—%	0.19%	0.29%	6.04%
3	Credit institutions	16.93%	1.40%	—%	0.21%	0.19%	5.48%
4	Loans and advances	18.97%	1.56%	—%	0.23%	0.20%	4.56%
5	Debt securities, including UoP	6.83%	0.59%	—%	0.12%	0.11%	0.92%
6	Equity instruments	15.87%	1.78%		0.02%	0.08%	—%
7	Other financial corporations	14.49%	1.52%	0.01%	0.01%	1.32%	0.57%
8	of which investment firms	13.89%	1.49%	0.01%	—%	1.38%	0.54%
9	Loans and advances	15.19%	1.68%	0.01%	—%	1.57%	0.47%
10	Debt securities, including UoP	—%	—%	—%	—%	—%	0.02%
11	Equity instruments	6.34%	0.12%		—%	0.04%	0.05%
12	of which management companies	—%	—%	—%	—%	—%	—%
13	Loans and advances	—%	—%	—%	—%	—%	—%
14	Debt securities, including UoP	—%	—%	—%	—%	—%	—%
15	Equity instruments	—%	—%		—%	—%	—%
16	of which insurance undertakings	26.03%	2.16%	—%	0.03%	0.13%	0.03%
17	Loans and advances	41.08%	3.40%	—%	0.05%	0.20%	0.02%
18	Debt securities, including UoP	—%	—%	—%	—%	—%	—%
19	Equity instruments	—%	—%		—%	—%	0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	27.97%	10.64%	2.40%	1.95%	3.04%	6.28%
21	Loans and advances	27.39%	10.36%	2.44%	1.99%	2.63%	6.18%
22	Debt securities, including UoP	61.59%	27.05%	—%	—%	27.02%	0.11%
23	Equity instruments	—%	—%	—%	—%	—%	—%
24	Households	88.39%	7.49%	7.49%	0.04%	—%	38.14%
25	of which loans collateralised by residential immovable property	100.00%	8.78%	8.78%	—%	—%	32.32%
26	of which building renovation loans	100.00%	—%	—%	—%	—%	0.50%
27	of which motor vehicle loans	100.00%	1.88%	1.88%	1.88%	—%	0.89%
28	Local governments financing	0.08%	—%	—%	—%	—%	0.62%
29	Housing financing	—%	—%	—%	—%	—%	—%
30	Other local governments financing	0.08%	—%	—%	—%	—%	0.62%
	Collateral obtained by taking possession: residential and commercial immovable
31 32	properties Total GAR assets	100.00% 47.75%	—% 4.68%	—% 3.89%	—% 0.20%	—% 0.27%	0.38% 77.19%

Disclosure reference date 31/12/2023
Climate Change Mitigation (CCM) Climate Change Adaptation (ACC)	Water and Marine Resources (WTR)
Proportion of total covered assets funding taxonomy relevant Proportion of total covered assets funding	Proportion of total covered assets funding
sectors (Taxonomy-eligible) taxonomy relevant sectors (Taxonomy-eligible) % (compared to total covered assets in the denominator)	taxonomy relevant sectors (Taxonomy-eligible) Proportion
Proportion of total covered assets Proportion of total covered assets funding funding taxonomy relevant sectors	Proportion of total covered assets of total funding taxonomy relevant sectors
taxonomy relevant sectors (Taxonomy-aligned)	assets (Taxonomy-aligned) (Taxonomy-aligned)
Of which Of which transition Of which Of which	covered Of which Of which Of which
UoP al enabling UoP	enabling UoP enabling
GAR - Covered assets in both numerator and denominator
Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1 calculation 49.89% 4.29% —% 0.07% 0.22% 0.17% 0.07% —%	—% 64.79%
2 Financial corporations —% —% —% —% —% —% —% —%	—% 4.40%
3 Credit institutions —% —% —% —% —% —% —% —%	—% 3.77%
4 Loans and advances —% —% —% —% —% —% —% —%	—% 3.21%
5 Debt securities, including UoP —% —% —% —% —% —% —% —%	—% 0.56%
6 Equity instruments —% —% —% —% —% —%	—% 0.01%
7 Other financial corporations —% —% —% —% —% —% —% —%	—% 0.63%
8 of which investment firms —% —% —% —% —% —% —% —%	—% 0.57%
9 Loans and advances —% —% —% —% —% —% —% —%	—% 0.51%
10 Debt securities, including UoP —% —% —% —% —% —% —% —%	—% 0.04%
11 Equity instruments —% —% —% —% —% —%	—% 0.03%
12 of which management companies —% —% —% —% —% —% —% —%	—% —%
13 Loans and advances —% —% —% —% —% —% —% —%	—% —%
14 Debt securities, including UoP —% —% —% —% —% —% —% —%	—% —%
15 Equity instruments —% —% —% —% —% —%	—% —%
16 of which insurance undertakings —% —% —% —% —% —% —% —%	—% 0.02%
17 Loans and advances —% —% —% —% —% —% —% —%	—% 0.01%
18 Debt securities, including UoP —% —% —% —% —% —% —% —%	—% —%
19 Equity instruments —% —% —% —% —% —%	—% 0.01%
20 Non-financial corporations (subject to NFRD disclosure obligations) 1.34% 0.49% —% 0.06% 0.22% 0.17% 0.07% —%	—% 8.49%
21 Loans and advances 1.28% 0.47% —% 0.06% 0.21% 0.16% 0.07% —%	—% 8.38%
22 Debt securities, including UoP 0.06% 0.01% —% —% 0.01% —% —% —%	—% 0.11%
23 Equity instruments —% —% —% —% —% —% —% —%	—% —%
24 Households 48.54% 3.81% —% —% —% —% —% —%	—% 51.02%
25 of which loans collateralised by residential immovable property 43.26% 3.80% —% —% —% —% —% —%	—% 43.26%
26 of which building renovation loans 0.75% —% —% —% —% —% —% —%	—% 0.75%
27 of which motor vehicle loans 0.22% —% —% —% —% —%	1.04%
28 Local governments financing —% —% —% —% —% —% —% —%	—% 0.88%
29 Housing financing —% —% —% —% —% —% —% —%	—% —%
30 Other local governments financing —% —% —% —% —% —% —% —%	—% 0.88%
Collateral obtained by taking possession: residential and commercial immovable
31 properties 0.73% 0.05% —% —% —% —% —% —% 32 Total GAR assets 49.89% 4.29% —% 0.07% 0.22% 0.17% 0.07% —%	—% 0.73% —% 64.79%

		at	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bk
							Disclosure reference date 31/12/2023
			Circular Economy (CE)			Pollution (PPC) Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding				Proportion of total covered assets funding				Proportion of total covered assets funding
	% (compared to total covered assets in the denominator)		taxonomy relevant sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)			Proportion
			Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors			of total
					(Taxonomy-aligned)			(Taxonomy-aligned)					(Taxonomy-aligned)	assets
				Of which	Of which			Of which	Of which			Of which	Of which	covered
				UoP	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1 2	calculation Financial corporations													64.79% 4.40%
3	Credit institutions													3.77%
4	Loans and advances													3.21%
5	Debt securities, including UoP													0.56%
6	Equity instruments													0.01%
7	Other financial corporations													0.63%
8	of which investment firms													0.57%
9	Loans and advances													0.51%
10	Debt securities, including UoP													0.04%
11	Equity instruments													0.03%
12	of which management companies													—%
13	Loans and advances													—%
14	Debt securities, including UoP													—%
15	Equity instruments													—%
16	of which insurance undertakings													0.02%
17	Loans and advances													0.01%
18	Debt securities, including UoP													—%
19	Equity instruments													0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)													8.49%
21	Loans and advances													8.38%
22	Debt securities, including UoP													0.11%
23	Equity instruments													—%
24	Households													51.02%
25	of which loans collateralised by residential immovable property													43.26%
26	of which building renovation loans													0.75%
27	of which motor vehicle loans													1.04%
28	Local governments financing													0.88%
29	Housing financing													—%
30	Other local governments financing													0.88%
31	Collateral obtained by taking possession: residential and commercial immovable properties													0.73%
32	Total GAR assets													64.79%

			bf	bg	bh	bi	bj	bk
					Disclosure reference date 31/12/2024
				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
	% (compared to total covered assets in the denominator)			Proportion of total covered assets funding taxonomy relevant sectors
							(Taxonomy-aligned)	Proportion of total assets covered
					Of which UoP	Of which	transitional Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	50.06%	4.36%	—%	0.07%		0.22%	64.79%
2	Financial corporations	—%	—%	—%	—%		—%	4.40%
3	Credit institutions	—%	—%	—%	—%		—%	3.77%
4	Loans and advances	—%	—%	—%	—%		—%	3.21%
5	Debt securities, including UoP	—%	—%	—%	—%		—%	0.56%
6	Equity instruments	—%	—%		—%		—%	0.01%
7	Other financial corporations	—%	—%	—%	—%		—%	0.63%
8	of which investment firms	—%	—%	—%	—%		—%	0.57%
9	Loans and advances	—%	—%	—%	—%		—%	0.51%
10	Debt securities, including UoP	—%	—%	—%	—%		—%	0.04%
11	Equity instruments	—%	—%		—%		—%	0.03%
12	of which management companies	—%	—%	—%	—%		—%	—%
13	Loans and advances	—%	—%	—%	—%		—%	—%
14	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
15	Equity instruments	—%	—%		—%		—%	—%
16	of which insurance undertakings	—%	—%	—%	—%		—%	0.02%
17	Loans and advances	—%	—%	—%	—%		—%	0.01%
18	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
19	Equity instruments	—%	—%		—%		—%	0.01%
20	Non-financial corporations (subject to NFRD disclosure obligations)	1.51%	0.55%	—%	0.06%		0.22%	8.49%
21	Loans and advances	1.45%	0.54%	—%	0.06%		0.21%	8.38%
22	Debt securities, including UoP	0.06%	0.01%	—%	—%		0.01%	0.11%
23	Equity instruments	—%	—%	—%	—%		—%	—%
24	Households	48.54%	3.81%	—%	—%		—%	51.02%
25	of which loans collateralised by residential immovable property	43.26%	3.80%	—%	—%		—%	43.26%
26	of which building renovation loans	0.75%	—%	—%	—%		—%	0.75%
27	of which motor vehicle loans	0.22%	—%	—%	—%		—%	1.04%
28	Local governments financing	—%	—%	—%	—%		—%	0.88%
29	Housing financing	—%	—%	—%	—%		—%	—%
30	Other local governments financing	—%	—%	—%	—%		—%	0.88%
	Collateral obtained by taking possession: residential and commercial immovable
31 32	properties Total GAR assets	0.73% 50.78%	0.05% 4.41%	—% —%	—% 0.07%		—% 0.22%	0.73% 64.79%

4. GAR (%) in terms of flow in relation to turnover and CapEx KPIs

GAR KPI flow - Turnover based

		a		b c	d	e		f g	h	i		j k	l m	af
								Disclosure reference date 31/12/2024
				Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
				Proportion of total covered assets funding taxonomy relevant				Proportion of total covered assets funding				Proportion of total covered assets funding
	% (compared to flow of eligible assets)		sectors (Taxonomy-eligible) taxonomy relevant sectors (Taxonomy-eligible)									taxonomy relevant sectors (Taxonomy-eligible) Proportion
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)						Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors	of total assets
				Of which	Of which	Of which			Of which	Of which			Of which Of which	covered
				UoP	transitiona	enabling			UoP	enabling			UoP enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	47.12%	5.85%	4.11%	0.62%	0.51%	0.06%	0.01%	—%	0.01%	—%			50.17%
2	Financial corporations	16.60%	1.22%	—%	0.12%	0.10%	0.06%	0.01%	—%	—%	—%			15.21%
3	Credit institutions	16.95%	1.26%	—%	0.12%	0.10%	0.06%	0.01%	—%	—%	—%			14.70%
4	Loans and advances	17.04%	1.27%	—%	0.12%	0.10%	0.06%	0.01%	—%	—%	—%			14.63%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.08%
6	Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
7	Other financial corporations	6.16%	0.06%	0.01%	—%	0.01%	—%	—%	—%	—%	—%			0.50%
8 9	of which investment firms Loans and advances	6.16% 6.16%	0.06% 0.06%	0.01% 0.01%	—% —%	0.01% 0.01%	—% —%	—% —%	—% —%	—% —%	—% —%			0.50% 0.50%
	10 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	11 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	12 of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	13 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	14 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	15 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	16 of which insurance undertakings	0.45%	0.04%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	17 Loans and advances	0.45%	0.04%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	18 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	19 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	21.39%	10.62%	4.51%	2.41%	2.15%	0.18%	0.05%	—%	0.03%	0.02%			11.26%
	21 Loans and advances	21.39%	10.62%	4.51%	2.41%	2.15%	0.18%	0.05%	—%	0.03%	0.02%			11.26%
	22 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	23 Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	24 Households	79.76%	6.62%	6.62%	0.09%	—%	—%	—%	—%	—%	—%			23.46%
	25 of which loans collateralised by residential immovable property	100.00%	8.87%	8.87%	—%	—%	—%	—%	—%	—%	—%			17.26%
	26 of which building renovation loans	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.12%
	27 of which motor vehicle loans	100.00%	1.65%	1.65%	1.65%	—%	—%							1.33%
	28 Local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.24%
	29 Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	30 Other local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.24%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.03%
	32 Total GAR assets	28.85%	3.58%	2.51%	0.38%	0.31%	0.03%	0.01%	—%	—%	—%			82.05%

		n	o p	q	r	s	t	u	v	w	x	z	af
						Disclosure reference date 31/12/2024
			Circular Economy (CE)			Pollution (PPC)			Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding taxonomy		Proportion of total covered assets funding taxonomy					Proportion of total covered assets funding taxonomy
	% (compared to flow of eligible assets)		relevant sectors (Taxonomy-eligible)			relevant sectors (Taxonomy-eligible)				relevant sectors (Taxonomy-eligible) Proportion
			Proportion of total covered assets funding taxonomy relevant sectors					Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors		of total assets
			Of which	Of which			Of which	Of which			Of which	Of which	covered
			UoP	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	0.02%			0.08%				0.02%				50.17%
2	Financial corporations	—%			—%				—%				15.21%
3	Credit institutions	—%			—%				—%				14.70%
4	Loans and advances	—%			—%				—%				14.63%
5	Debt securities, including UoP	—%			—%				—%				0.08%
6	Equity instruments	—%			—%				—%				—%
7	Other financial corporations	—%			—%				—%				0.50%
8	of which investment firms	—%			—%				—%				0.50%
9	Loans and advances	—%			—%				—%				0.50%
	10 Debt securities, including UoP	—%			—%				—%				—%
	11 Equity instruments	—%			—%				—%				—%
	12 of which management companies	—%			—%				—%				—%
	13 Loans and advances	—%			—%				—%				—%
	14 Debt securities, including UoP	—%			—%				—%				—%
	15 Equity instruments	—%			—%				—%				—%
	16 of which insurance undertakings	—%			—%				—%				—%
	17 Loans and advances	—%			—%				—%				—%
	18 Debt securities, including UoP	—%			—%				—%				—%
	19 Equity instruments	—%			—%				—%				—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	0.09%			0.34%				0.10%				11.26%
	21 Loans and advances	0.09%			0.34%				0.10%				11.26%
	22 Debt securities, including UoP 23 Equity instruments	—% —%			—% —%				—% —%				—% —%
	24 Households	—%			—%				—%				23.46%
	25 of which loans collateralised by residential immovable property	—%			—%				—%				17.26%
	26 of which building renovation loans	—%			—%				—%				0.12%
	27 of which motor vehicle loans	—%			—%				—%				1.33%
	28 Local governments financing	—%			—%				—%				0.24%
	29 Housing financing	—%			—%				—%				—%
	30 Other local governments financing	—%			—%				—%				0.24%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	—%			—%				—%				0.03%
	32 Total GAR assets	0.01%			0.05%				0.01%				82.05%

			aa	ab ac	ad	ae	af
					Disclosure reference date 31/12/2024
				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	% (compared to flow of eligible assets)			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy			Proportion of total
						aligned)	assets covered
				Of which UoP	Of which transitional	Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	47.30%	5.86%	4.11%	0.62%	0.52%	50.17%
2	Financial corporations	16.65%	1.23%	—%	0.12%	0.10%	15.21%
3	Credit institutions	17.01%	1.27%	—%	0.12%	0.10%	14.70%
4	Loans and advances	17.10%	1.27%	—%	0.12%	0.10%	14.63%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	0.08%
6	Equity instruments	—%	—%		—%	—%	—%
7	Other financial corporations	6.16%	0.06%	0.01%	—%	0.01%	0.50%
8	of which investment firms	6.17%	0.06%	0.01%	—%	0.01%	0.50%
9	Loans and advances	6.17%	0.06%	0.01%	—%	0.01%	0.50%
	10 Debt securities, including UoP	—%	—%	—%	—%	—%	—%
	11 Equity instruments	—%	—%		—%	—%	—%
	12 of which management companies	—%	—%	—%	—%	—%	—%
	13 Loans and advances	—%	—%	—%	—%	—%	—%
	14 Debt securities, including UoP	—%	—%	—%	—%	—%	—%
	15 Equity instruments	—%	—%		—%	—%	—%
	16 of which insurance undertakings	0.45%	0.04%	—%	—%	—%	—%
	17 Loans and advances	0.45%	0.04%	—%	—%	—%	—%
	18 Debt securities, including UoP	—%	—%	—%	—%	—%	—%
	19 Equity instruments	—%	—%		—%	—%	—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	22.11%	10.67%	4.51%	2.41%	2.17%	11.26%
	21 Loans and advances	22.11%	10.67%	4.51%	2.41%	2.17%	11.26%
	22 Debt securities, including UoP	—%	—%	—%	—%	—%	—%
	23 Equity instruments	—%	—%	—%	—%	—%	—%
	24 Households	79.76%	6.62%	6.62%	0.09%	—%	23.46%
	25 of which loans collateralised by residential immovable property	100.00%	8.87%	8.87%	—%	—%	17.26%
	26 of which building renovation loans	100.00%	—%	—%	—%	—%	0.12%
	27 of which motor vehicle loans	100.00%	1.65%	1.65%	1.65%	—%	1.33%
	28 Local governments financing	—%	—%	—%	—%	—%	0.24%
	29 Housing financing	—%	—%	—%	—%	—%	—%
	30 Other local governments financing	—%	—%	—%	—%	—%	0.24%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	100.00%	—%	—%	—%	—%	0.03%
	32 Total GAR assets	28.96%	3.59%	2.51%	0.38%	0.32%	82.05%

		ag		ah ai	aj	ak	al	am		an ap	aq	aq	ar	as bk
								Disclosure reference date 31/12/2023
				Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
				Proportion of total covered assets funding taxonomy relevant						Proportion of total covered assets funding			Proportion of total covered assets funding
	% (compared to flow of total eligible assets)					sectors (Taxonomy-eligible)	taxonomy relevant sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible) Proportion
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)						Proportion of total covered assets funding taxonomy relevant sectors			of total Proportion of total covered assets assets funding taxonomy relevant sectors
				Of which	Of which	Of which			Of which	Of which			Of which Of which	covered
				UoP	transitiona	enabling				UoP enabling			UoP enabling
GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	32.90%	5.84%	—%	0.04%	0.22%	0.17%	0.04%	—%	—%				69.24%
2 3	Financial corporations Credit institutions	—% —%	—% —%	—% —%	—% —%	—% —%	—% —%	—% —%	—% —%	—% —%				15.48% 14.94%
4	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				14.94%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
6	Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
7	Other financial corporations	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.54%
8	of which investment firms	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.54%
9	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.54%
	10 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	11 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	12 of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	13 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	14 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	15 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	16 of which insurance undertakings	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	17 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	18 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	19 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	2.02%	0.75%	—%	0.03%	0.22%	0.17%	0.04%	—%	—%				16.82%
	21 Loans and advances	2.02%	0.75%	—%	0.03%	0.22%	0.17%	0.04%	—%	—%				16.82%
	22 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	23 Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	24 Households	30.88%	5.09%	—%	0.01%	—%	—%	—%	—%	—%				36.71%
	25 of which loans collateralised by residential immovable property	25.27%	5.08%	—%	—%	—%	—%	—%	—%	—%				25.27%
	26 of which building renovation loans	0.28%	—%	—%	—%	—%	—%	—%	—%	—%				0.28%
	27 of which motor vehicle loans	0.52%	—%	—%	—%	—%	—%							4.73%
	28 Local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.23%
	29 Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	30 Other local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.23%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.09%	—%	—%	—%	—%	—%	—%	—%	—%				0.09%
	32 Total GAR assets	32.90%	5.84%	—%	0.04%	0.22%	0.17%	0.04%	—%	—%				69.24%

		at	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bk
		Disclosure reference date 31/12/2023
			Circular Economy (CE)				Pollution (PPC)					Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding taxonomy			Proportion of total covered assets funding taxonomy						Proportion of total covered assets funding taxonomy
	% (compared to flow of total eligible assets)			relevant sectors (Taxonomy-eligible)				relevant sectors (Taxonomy-eligible)				relevant sectors (Taxonomy-eligible) Proportion
				Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors				Proportion of total covered assets funding taxonomy relevant sectors		of total assets
				Of which	Of which			Of which	Of which			Of which	Of which	covered
				UoP	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation													69.24%
2	Financial corporations													15.48%
3	Credit institutions													14.94%
4	Loans and advances													14.94%
5	Debt securities, including UoP													—%
6	Equity instruments													—%
7	Other financial corporations													0.54%
8	of which investment firms													0.54%
9	Loans and advances													0.54%
	10 Debt securities, including UoP													—%
	11 Equity instruments													—%
	12 of which management companies													—%
	13 Loans and advances													—%
	14 Debt securities, including UoP													—%
	15 Equity instruments													—%
	16 of which insurance undertakings													—%
	17 Loans and advances													—%
	18 Debt securities, including UoP													—%
	19 Equity instruments													—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)													16.82%
	21 Loans and advances													16.82%
	22 Debt securities, including UoP													—%
	23 Equity instruments													—%
	24 Households													36.71%
	25 of which loans collateralised by residential immovable property													25.27%
	26 of which building renovation loans													0.28%
	27 of which motor vehicle loans 28 Local governments financing													4.73% 0.23%
	29 Housing financing													—%
	30 Other local governments financing													0.23%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties													0.09%
	32 Total GAR assets													69.24%

			bf	bg	bh	bi	bj	bk
					Disclosure reference date 31/12/2023
				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	% (compared to flow of total eligible assets)			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy				Proportion of total assets covered
						Of which	aligned)
					Of which UoP	transitional	Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	33.15%	6.30%	—%	0.07%		0.22%	69.24%
2	Financial corporations	—%	—%	—%	—%		—%	15.48%
3	Credit institutions	—%	—%	—%	—%		—%	14.94%
4	Loans and advances	—%	—%	—%	—%		—%	14.94%
5	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
6	Equity instruments	—%	—%		—%		—%	—%
7	Other financial corporations	—%	—%	—%	—%		—%	0.54%
8	of which investment firms	—%	—%	—%	—%		—%	0.54%
9	Loans and advances	—%	—%	—%	—%		—%	0.54%
	10 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	11 Equity instruments	—%	—%		—%		—%	—%
	12 of which management companies	—%	—%	—%	—%		—%	—%
	13 Loans and advances	—%	—%	—%	—%		—%	—%
	14 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	15 Equity instruments	—%	—%		—%		—%	—%
	16 of which insurance undertakings	—%	—%	—%	—%		—%	—%
	17 Loans and advances	—%	—%	—%	—%		—%	—%
	18 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	19 Equity instruments	—%	—%		—%		—%	—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	2.27%	0.85%	—%	0.07%		0.22%	16.82%
	21 Loans and advances	2.27%	0.85%	—%	0.07%		0.22%	16.82%
	22 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	23 Equity instruments	—%	—%	—%	—%		—%	—%
	24 Households	30.88%	5.45%	—%	—%		—%	36.71%
	25 of which loans collateralised by residential immovable property	25.27%	5.45%	—%	—%		—%	25.27%
	26 of which building renovation loans	0.28%	—%	—%	—%		—%	0.28%
	27 of which motor vehicle loans	0.52%	—%	—%	—%		—%	4.73%
	28 Local governments financing	—%	—%	—%	—%		—%	0.23%
	29 Housing financing	—%	—%	—%	—%		—%	—%
	30 Other local governments financing	—%	—%	—%	—%		—%	0.23%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties	0.09%	—%	—%	—%		—%	0.09%
	32 Total GAR assets	33.15%	6.30%	—%	0.07%		0.22%	69.24%

GAR KPI flow - CapEx based

		a	b	c	d	e		f g	h	i	j	k l	m	af
								Disclosure reference date 31/12/2024
				Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
					Proportion of total covered assets funding taxonomy relevant			Proportion of total covered assets funding				Proportion of total covered assets funding
	% (compared to flow of eligible assets)				sectors (Taxonomy-eligible)			taxonomy relevant sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible) Proportion
					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors		Proportion of total covered assets funding taxonomy relevant sectors		of total assets
				Of which	Of which	Of which			Of which	Of which		Of which	Of which	covered
				UoP	transitiona	enabling			UoP	enabling		UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	47.77%	6.11%	4.11%	0.67%	0.56%	0.09%	0.01%	—%	—%	0.01%			50.17%
2	Financial corporations	16.52%	1.39%	—%	0.14%	0.16%	0.04%	0.01%	—%	—%	—%			15.21%
3	Credit institutions	16.87%	1.44%	—%	0.14%	0.17%	0.04%	0.01%	—%	—%	—%			14.70%
4	Loans and advances	16.96%	1.44%	—%	0.14%	0.17%	0.04%	0.01%	—%	—%	—%			14.63%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.08%
6	Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
7	Other financial corporations	6.20%	0.08%	0.01%	—%	0.02%	—%	—%	—%	—%	—%			0.50%
8	of which investment firms	6.20%	0.08%	0.01%	—%	0.02%	—%	—%	—%	—%	—%			0.50%
9	Loans and advances	6.20%	0.08%	0.01%	—%	0.02%	—%	—%	—%	—%	—%			0.50%
	10 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	11 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	12 of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	13 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	14 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	15 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	16 of which insurance undertakings	0.45%	0.04%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	17 Loans and advances	0.45%	0.04%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	18 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	19 Equity instruments	—%	—%		—%	—%	—%	—%		—%	—%			—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	24.38%	11.57%	4.51%	2.60%	2.26%	0.34%	0.03%	—%	0.01%	0.02%			11.26%
	21 Loans and advances	24.38%	11.57%	4.51%	2.60%	2.26%	0.34%	0.03%	—%	0.01%	0.02%			11.26%
	22 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	23 Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	24 Households	79.76%	6.62%	6.62%	0.09%	—%	—%	—%	—%	—%	—%			23.46%
	25 of which loans collateralised by residential immovable property	100.00%	8.87%	8.87%	—%	—%	—%	—%	—%	—%	—%			17.26%
	26 of which building renovation loans	100.00%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.12%
	27 of which motor vehicle loans	100.00%	1.65%	1.65%	1.65%	—%	—%	—%	—%	—%	—%			1.33%
	28 Local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.24%
	29 Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			—%
	30 Other local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%	—%			0.24%
	Collateral obtained by taking possession: residential and commercial immovable
31	properties 32 Total GAR assets	100.00% 29.24%	—% 3.74%	—% 2.51%	—% 0.41%	—% 0.34%	—% 0.05%	—% 0.01%	—% —%	—% —%	—% —%			0.03% 82.05%

		n	o p	q r	s	t u	v	w	x	z	af
						Disclosure reference date 31/12/2024
			Circular Economy (CE)		Pollution (PPC)		Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding taxonomy		Proportion of total covered assets funding taxonomy			Proportion of total covered assets funding taxonomy
	% (compared to flow of eligible assets)		relevant sectors (Taxonomy-eligible)			relevant sectors (Taxonomy-eligible)			relevant sectors (Taxonomy-eligible) Proportion
			Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors		of total assets
			Of which Of which			Of which Of which			Of which	Of which	covered
			UoP enabling			UoP enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	0.07%		0.06%			0.02%				50.17%
2	Financial corporations	—%		—%			—%				15.21%
3	Credit institutions	—%		—%			—%				14.70%
4	Loans and advances	—%		—%			—%				14.63%
5	Debt securities, including UoP	—%		—%			—%				0.08%
6	Equity instruments	—%		—%			—%				—%
7	Other financial corporations	—%		—%			—%				0.50%
8	of which investment firms	—%		—%			—%				0.50%
9	Loans and advances	—%		—%			—%				0.50%
	10 Debt securities, including UoP	—%		—%			—%				—%
	11 Equity instruments	—%		—%			—%				—%
	12 of which management companies	—%		—%			—%				—%
	13 Loans and advances	—%		—%			—%				—%
	14 Debt securities, including UoP	—%		—%			—%				—%
	15 Equity instruments	—%		—%			—%				—%
	16 of which insurance undertakings	—%		—%			—%				—%
	17 Loans and advances	—%		—%			—%				—%
	18 Debt securities, including UoP	—%		—%			—%				—%
	19 Equity instruments	—%		—%			—%				—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	0.31%		0.29%			0.10%				11.26%
	21 Loans and advances	0.31%		0.29%			0.10%				11.26%
	22 Debt securities, including UoP	—%		—%			—%				—%
	23 Equity instruments	—%		—%			—%				—%
	24 Households	—%		—%			—%				23.46%
	25 of which loans collateralised by residential immovable property	—%		—%			—%				17.26%
	26 of which building renovation loans	—%		—%			—%				0.12%
	27 of which motor vehicle loans	—%		—%			—%				1.33%
	28 Local governments financing	—%		—%			—%				0.24%
	29 Housing financing	—%		—%			—%				—%
	30 Other local governments financing	—%		—%			—%				0.24%
31	Collateral obtained by taking possession: residential and commercial immovable properties	—%		—%			—%				0.03%
	32 Total GAR assets	0.04%		0.04%			0.01%				82.05%

			aa	ab	ac	ad	ae	af
					Disclosure reference date 31/12/2024
				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
	% (compared to flow of eligible assets)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy			aligned)	Proportion of total assets covered
						Of which
				Of which UoP		transitional	Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	48.02%	6.12%	4.11%	0.67%		0.56%	50.17%
2	Financial corporations	16.55%	1.40%	—%	0.14%		0.16%	15.21%
3	Credit institutions	16.91%	1.44%	—%	0.14%		0.17%	14.70%
4	Loans and advances	17.00%	1.45%	—%	0.14%		0.17%	14.63%
5	Debt securities, including UoP	—%	—%	—%	—%		—%	0.08%
6	Equity instruments	—%	—%		—%		—%	—%
7	Other financial corporations	6.21%	0.08%	0.01%	—%		0.02%	0.50%
8	of which investment firms	6.21%	0.08%	0.01%	—%		0.02%	0.50%
9	Loans and advances	6.21%	0.08%	0.01%	—%		0.02%	0.50%
	10 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	11 Equity instruments	—%	—%		—%		—%	—%
	12 of which management companies	—%	—%	—%	—%		—%	—%
	13 Loans and advances	—%	—%	—%	—%		—%	—%
	14 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	15 Equity instruments	—%	—%		—%		—%	—%
	16 of which insurance undertakings	0.45%	0.04%	—%	—%		—%	—%
	17 Loans and advances	0.45%	0.04%	—%	—%		—%	—%
	18 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	19 Equity instruments	—%	—%		—%		—%	—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	25.45%	11.60%	4.51%	2.60%		2.26%	11.26%
	21 Loans and advances	25.45%	11.60%	4.51%	2.60%		2.26%	11.26%
	22 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	23 Equity instruments	—%	—%	—%	—%		—%	—%
	24 Households	79.76%	6.62%	6.62%	0.09%		—%	23.46%
	25 of which loans collateralised by residential immovable property	100.00%	8.87%	8.87%	—%		—%	17.26%
	26 of which building renovation loans	100.00%	—%	—%	—%		—%	0.12%
	27 of which motor vehicle loans	100.00%	1.65%	1.65%	1.65%		—%	1.33%
	28 Local governments financing	—%	—%	—%	—%		—%	0.24%
	29 Housing financing	—%	—%	—%	—%		—%	—%
	30 Other local governments financing	—%	—%	—%	—%		—%	0.24%
31	Collateral obtained by taking possession: residential and commercial immovable properties	100.00%	—%	—%	—%		—%	0.03%
	32 Total GAR assets	29.40%	3.75%	2.51%	0.41%		0.34%	82.05%

		ag		ah ai	aj	ak		al am		an ap	aq	aq	ar	as bk
								Disclosure reference date 31/12/2023
				Climate Change Mitigation (CCM)				Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
						Proportion of total covered assets funding taxonomy relevant				Proportion of total covered assets funding			Proportion of total covered assets funding
	% (compared to flow of total eligible assets)					sectors (Taxonomy-eligible)				taxonomy relevant sectors (Taxonomy-eligible)	taxonomy relevant sectors (Taxonomy-eligible) Proportion
			Proportion of total covered assets funding Proportion of total covered assets taxonomy relevant sectors (Taxonomy-aligned) funding taxonomy relevant sectors										Proportion of total covered assets funding taxonomy relevant sectors	of total assets
				Of which	Of which	Of which			Of which	Of which			Of which Of which	covered
				UoP	transitiona	enabling				UoP enabling			UoP enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation	34.40%	6.04%	—%	0.03%	0.43%	0.08%	0.03%	—%	—%				73.41%
2	Financial corporations	—%	—%	—%	—%	—%	—%	—%	—%	—%				16.02%
3	Credit institutions	—%	—%	—%	—%	—%	—%	—%	—%	—%				15.46%
4	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				15.46%
5	Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
6	Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
7	Other financial corporations	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.56%
8	of which investment firms	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.56%
9	Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.56%
	10 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	11 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	12 of which management companies	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	13 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	14 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	15 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	16 of which insurance undertakings	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	17 Loans and advances	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	18 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	19 Equity instruments	—%	—%		—%	—%	—%	—%		—%				—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	2.44%	0.78%	—%	0.03%	0.43%	0.08%	0.03%	—%	—%				19.16%
	21 Loans and advances	2.44%	0.78%	—%	0.03%	0.43%	0.08%	0.03%	—%	—%				19.16%
	22 Debt securities, including UoP	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	23 Equity instruments	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	24 Households	31.96%	5.26%	—%	—%	—%	—%	—%	—%	—%				37.99%
	25 of which loans collateralised by residential immovable property	26.15%	5.26%	—%	—%	—%	—%	—%	—%	—%				26.15%
	26 of which building renovation loans	0.29%	—%	—%	—%	—%	—%	—%	—%	—%				0.29%
	27 of which motor vehicle loans	0.54%	—%	—%	—%	—%	—%							4.89%
	28 Local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.24%
	29 Housing financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				—%
	30 Other local governments financing	—%	—%	—%	—%	—%	—%	—%	—%	—%				0.24%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.09%	—%	—%	—%	—%	—%	—%	—%	—%				0.09%
	32 Total GAR assets	34.40%	6.04%	—%	0.03%	0.43%	0.08%	0.03%	—%	—%				73.41%

		at	au	av	aw	ax	ay	az	ba	bb	bc	bd	be	bk
							Disclosure reference date 31/12/2023
			Circular Economy (CE)				Pollution (PPC)				Biodiversity and ecosystems (BIO)
			Proportion of total covered assets funding taxonomy				Proportion of total covered assets funding taxonomy			Proportion of total covered assets funding taxonomy
	% (compared to flow of total eligible assets)			relevant sectors (Taxonomy-eligible)			relevant sectors (Taxonomy-eligible)					relevant sectors (Taxonomy-eligible) Proportion
				Proportion of total covered assets funding taxonomy relevant sectors					Proportion of total covered assets funding taxonomy relevant sectors			Proportion of total covered assets funding taxonomy relevant sectors		of total assets
				Of which	Of which			Of which	Of which			Of which	Of which	covered
				UoP	enabling			UoP	enabling			UoP	enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HfT eligible for GAR calculation													73.41%
2	Financial corporations													16.02%
3	Credit institutions													15.46%
4	Loans and advances													15.46%
5	Debt securities, including UoP													—%
6	Equity instruments													—%
7	Other financial corporations													0.56%
8	of which investment firms													0.56%
9	Loans and advances													0.56%
	10 Debt securities, including UoP													—%
	11 Equity instruments													—%
	12 of which management companies													—%
	13 Loans and advances													—%
	14 Debt securities, including UoP													—%
	15 Equity instruments													—%
	16 of which insurance undertakings													—%
	17 Loans and advances													—%
	18 Debt securities, including UoP													—%
	19 Equity instruments													—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)													19.16%
	21 Loans and advances													19.16%
	22 Debt securities, including UoP													—%
	23 Equity instruments													—%
	24 Households													37.99%
	25 of which loans collateralised by residential immovable property													26.15%
	26 of which building renovation loans													0.29%
	27 of which motor vehicle loans													4.89%
	28 Local governments financing													0.24%
	29 Housing financing													—%
	30 Other local governments financing													0.24%
31	Collateral obtained by taking possession: residential and commercial immovable properties													0.09%
	32 Total GAR assets													73.41%

			bf	bg	bh	bi	bj	bk
			Disclosure reference date 31/12/2023
				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	% (compared to flow of total eligible assets)			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy			aligned)	Proportion of total assets covered
						Of which
				Of which UoP		transitional	Of which enabling
	GAR - Covered assets in both numerator and denominator
	Loans and advances, debt securities and equity instruments not HfT eligible for GAR
1	calculation	34.63%	6.12%	—%	0.05%		0.43%	73.41%
2	Financial corporations	—%	—%	—%	—%		—%	16.02%
3	Credit institutions	—%	—%	—%	—%		—%	15.46%
4	Loans and advances	—%	—%	—%	—%		—%	15.46%
5	Debt securities, including UoP	—%	—%	—%	—%		—%	—%
6	Equity instruments	—%	—%		—%		—%	—%
7	Other financial corporations	—%	—%	—%	—%		—%	0.56%
8	of which investment firms	—%	—%	—%	—%		—%	0.56%
9	Loans and advances	—%	—%	—%	—%		—%	0.56%
	10 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	11 Equity instruments	—%	—%		—%		—%	—%
	12 of which management companies	—%	—%	—%	—%		—%	—%
	13 Loans and advances	—%	—%	—%	—%		—%	—%
	14 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	15 Equity instruments	—%	—%		—%		—%	—%
	16 of which insurance undertakings	—%	—%	—%	—%		—%	—%
	17 Loans and advances	—%	—%	—%	—%		—%	—%
	18 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	19 Equity instruments	—%	—%		—%		—%	—%
	20 Non-financial corporations (subject to NFRD disclosure obligations)	2.67%	0.87%	—%	0.05%		0.43%	19.16%
	21 Loans and advances	2.67%	0.87%	—%	0.05%		0.43%	19.16%
	22 Debt securities, including UoP	—%	—%	—%	—%		—%	—%
	23 Equity instruments	—%	—%	—%	—%		—%	—%
	24 Households	31.96%	5.26%	—%	—%		—%	37.99%
	25 of which loans collateralised by residential immovable property	26.15%	5.26%	—%	—%		—%	26.15%
	26 of which building renovation loans	0.29%	—%	—%	—%		—%	0.29%
	27 of which motor vehicle loans	0.54%	—%	—%	—%		—%	4.89%
	28 Local governments financing	—%	—%	—%	—%		—%	0.24%
	29 Housing financing	—%	—%	—%	—%		—%	—%
	30 Other local governments financing	—%	—%	—%	—%		—%	0.24%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.09%	—%	—%	—%		—%	0.09%
	32 Total GAR assets	34.63%	6.12%	—%	0.05%		0.43%	73.41%

5. Ratio of Taxonomy-aligned off-balance sheet exposures in relation to turnover and CapEx KPIs

Ratio of Taxonomy-aligned off-balance sheet exposures in relation to turnover KPIs

		a	b c	d	e		f	g	h i	j	k	l	m
							Disclosure reference date 31/12/2024
	Climate Change Mitigation (CCM)						Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
			Proportion of total covered assets funding taxonomy relevant sectors		(Taxonomy-eligible)		Proportion of total covered assets funding taxonomy		relevant sectors (Taxonomy-eligible)	Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
% (compared to total eligible off-balance sheet assets)			Proportion of total covered assets funding taxonomy		relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)		Proportion of total covered assets funding taxonomy relevant sectors	(Taxonomy-aligned)
			Of which UoP	Of which transitional	Of which enabling			Of which UoP	Of which enabling			Of which UoP	Of which enabling
1 Financial guarantees (FinGuar KPI)	17.00%	1.00%	—%	—%	1.00%	—%	—%	—%	—%	—%
2 Assets under management (AuM KPI)	25.00%	2.00%	—%	—%	—%	—%	—%	—%	—%	—%

	n	o	p	q	r	s	t	u	v	w	x	z
		Circular Economy (CE)					Pollution (PPC)		Biodiversity and ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
% (compared to total eligible off-balance sheet assets)	Proportion of total covered assets funding						Proportion of total covered assets funding		Proportion of total covered assets funding
		taxonomy relevant sectors (Taxonomy		aligned)			taxonomy relevant sectors (Taxonomy	aligned)			taxonomy relevant sectors (Taxonomy	aligned)
				Of which				Of which				Of which
			Of which UoP	enabling			Of which UoP	enabling			Of which UoP	enabling
1 Financial guarantees (FinGuar KPI)	—%				1.00%				1.00%
2 Assets under management (AuM KPI)	—%				—%				—%

		aa	ab ac	ad	ae
% (compared to total eligible off-balance sheet assets)		TOTAL (CCM + CCA + WTR + CE + PPC + BIO) Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible) Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
1 Financial guarantees (FinGuar KPI)	20.00%	1.00%	Of which UoP	Of which transitional —%	Of which enabling 1.00%
2 Assets under management (AuM KPI)	25.00%	2.00%		—%	—%

Ratio of Taxonomy-aligned off-balance sheet exposures in relation to CapEx KPIs

	a	b	c	d	e		f	g	h i	j	k	l	m
							Disclosure reference date 31/12/2024
% (compared to total eligible off-balance sheet assets)	Climate Change Mitigation (CCM)						Climate Change Adaptation (ACC)			Water and Marine Resources (WTR)
			Proportion of total covered assets funding taxonomy relevant sectors		(Taxonomy-eligible)		Proportion of total covered assets funding taxonomy		relevant sectors (Taxonomy-eligible)	Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
			Proportion of total covered assets funding taxonomy		relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)		Proportion of total covered assets funding taxonomy relevant sectors	(Taxonomy-aligned)
			Of which UoP	Of which transitional	Of which enabling			Of which	Of which UoP enabling		Of which	UoP	Of which enabling
1 Financial guarantees (FinGuar KPI)	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00
2 Assets under management (AuM KPI)	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00

	n	o	p	q	r	s t	u	v		w	x z
% (compared to total eligible off-balance sheet assets)			Pollution (PPC)		Biodiversity and ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding	Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy	aligned)	Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy			aligned)
				aligned) Of which			Of which				Of which
		Of which UoP		enabling		Of which UoP	enabling			Of which UoP	enabling
1 Financial guarantees (FinGuar KPI)	0.00				0.00			0.00
2 Assets under management (AuM KPI)	0.00				0.00			0.00

			aa	ab	ac ad	ae
% (compared to total eligible off-balance sheet assets)		Disclosure reference date 31/12/2024
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
					Proportion of total covered assets funding taxonomy relevant	sectors (Taxonomy-aligned)
				Of which UoP	Of which transitional	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.00	0.00	0.00	0.00	0.00
2	Assets under management (AuM KPI)	0.00	0.00	0.00	0.00	0.00

Amount and proportion of Taxonomy-aligned exposures reported in the GAR's denominator and numerator for nuclear and gas activities, mainly, in terms of both CapEx and turnover for each environmental objective.

Nuclear energy and fossil gas related activities in terms of turnover

R Nuclear energy related activities

1 The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle. YES

2 The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies. YES

3 The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades. YES

Fossil gas related activities

⁴ The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels. YES 5 The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels. YES

6 The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels. YES

Nuclear energy and fossil gas related activities in terms of CapEx

R Nuclear energy related activities

1 The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle. YES

2 The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies. YES

3 The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades. YES

Fossil gas related activities

• ⁴ The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels. YES
• 5 The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels. YES

The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels. YES

6

Taxonomy-aligned economic activities (denominator) in terms of turnover

						Amount and proportion (Amounts presented in million euros)
Row	Economic activities	CCM + CCA		Climate Mitigation (CCM)	Change	Climate Adaptation (CCA)	Change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	0.03%	—	0.03%	—	—%
3	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1.9	1.27%	1.9	1.35%	—	—%
4	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
5	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0.1	0.05%	0.1	0.05%	—	—%
6	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	0.01%	—	0.01%	—	—%
7	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	145.9	98.61%	136.7	98.52%	1.2	100.00%
8	Total applicable KPI	148.0	100.00%	138.7	100.00%	1.2	100.00%

Taxonomy-aligned economic activities (denominator) in terms of CapEx

				Amount and proportion (Amounts presented in million euros)
Row	Economic activities	CCM + CCA		Climate Mitigation (CCM)	Change	Climate Adaptation (CCA)	Change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0.2	0.08%	0.2	0.08%	—	—%
3	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	2.1	0.79%	2.1	0.83%	—	—%
4	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	0.02%	—	0.02%	—	—%
5	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0.2	0.08%	0.2	0.09%	—	—%
6	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
7	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	266.4	98.91%	255.7	98.88%	1.3	100.00%
8	Total applicable KPI	269.3	100.00%	258.6	100.00%	1.3	100.00%

Taxonomy-aligned economic activities (numerator) in terms of turnover

			Amount and proportion (Amounts presented in million euros)
Row	Economic activities	(CCM + CCA)		Climate mitigation	change	Climate adaptation	change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0.2	—%	0.2	—%	—	—%
3	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	265.6	3.22%	264.5	3.27%	—	—%
4	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	—	—%	—	—%	—	—%
5	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	5.6	0.07%	2.0	0.03%	3.6	2.76%
6	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	—	—%	—	—%	—	—%
7	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	7,971.0	96.70%	7,811.4	96.69%	126.9	97.24%
8	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	8,242.7	100.00%	8,078.5	100.00%	130.5	100.00%

Taxonomy-aligned economic activities (numerator) in terms of CapEx

				Amount and proportion (Amounts presented in million euros)
Row	Economic activities	(CCM + CCA)		Climate mitigation	change	Climate adaptation	change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	35.4	0.43%	35.2	0.44%	—	—%
3	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	249.5	3.04%	248.4	3.07%	—	—%
4	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0.1	—%	0.1	—%	—	—%
5	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	2.8	0.03%	2.8	0.03%	—	—%
6	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0.3	—%	0.3	—%	—	—%
7	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	7,922.7	96.50%	7,811.3	96.46%	113.8	100.00%
8	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	8,210.4	100.00%	8,098.0	100.00%	113.8	100.00%

Taxonomy-eligible but not taxonomy-aligned economic activities in terms of turnover

			Proportion (Amounts presented in million euros)
Row	Economic activities	(CCM + CCA)		Climate mitigation	change	Climate adaptation	change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
3	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0.2	0.01%	0.2	0.01%	—	—%
4	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	66.7	3.57%	80.3	4.38%	—	—%
5	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	3.2	0.17%	3.2	0.17%	—	0.10%
6	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
7	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	1,804.5	96.65%	1,757.9	95.83%	6.4	99.90%
8	Total amount and proportion of taxonomy eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	1,867.0	100.00%	1,834.5	100.00%	6.4	100.00%

Taxonomy-eligible but not taxonomy-aligned economic activities in terms of CapEx

	Proportion (Amounts presented in million euros)
Row	Economic activities	(CCM + CCA)		Climate mitigation	change	Climate adaptation	change
		Amount	%	Amount	%	Amount	%
1	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
2	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
3	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
4	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	20.0	1.12%	25.3	1.45%	—	—%
5	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1.5	0.08%	1.5	0.09%	—	—%
6	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	—	—%	—	—%	—	—%
7	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	1,758.2	98.79%	1,714.3	98.45%	4.3	100.00%
8	Total amount and proportion of taxonomy eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	1,779.8	100.00%	1,741.3	100.00%	4.3	100.00%

Taxonomy non-eligible economic activities in terms of turnover

Row	Economic activities	Amount	Percentage
1	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	3.5	0.06%
2	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5.1	0.09%
3	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	31.9	0.58%
4	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5.6	0.10%
5	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5.1	0.09%
6	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	4.4	0.08%
7	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	5,404.8	98.97%
8	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI		5,461.0 100.00%

Taxonomy non-eligible economic activities in terms of CapEx

Row	Economic activities	Amount	Percentage
1	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	3.3	0.07%
2	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5.6	0.11%
3	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	28.2	0.57%
4	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	4.3	0.09%
5	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	2.3	0.05%
6	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0.7	0.01%
7	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	4,912.0	99.10%
8	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	4,956.6	100.00%

6.4 Equator Principles

Since 2011, the Group has adhered to the Equator Principles, an international voluntary framework of policies, standards and guidelines which aims to identify, assess and manage environmental and social risks relating to project finance of 10 million US dollars or more and corporate loans related to projects of more than 50 million US dollars. Through the standards of the Equator Principles, a social and environmental assessment of the potential impacts of the project is carried out by an independent expert.

During 2024, a total of 31 new structured finance projects incorporating the Equator Principles were signed, 74.2% of which are renewable energy projects.

Sector	Number of projects	Category	Country	Region	Designated country	Independent review
Renewable energies	15	B	Spain	Europe	Yes	Yes
Renewable energies	1	C	Spain	Europe	Yes	Yes
Renewable energies	5	B	USA	Americas	Yes	Yes
Renewable energies	1	B	UK	Europe	Yes	Yes
Renewable energies	1	A	USA	Americas	Yes	Yes
Infrastructure	3	B	Spain	Europe	Yes	Yes
Infrastructure	1	C	Spain	Europe	Yes	Yes
Energy, Gas	2	B	Mexico	Americas	No	Yes
Waste	2	B	UK	Europe	Yes	Yes

6.5 List of disclosure requirements fulfilled

The table of contents of the information required pursuant to Law 11/2018 of 28 December on non-financial and diversity disclosures, together with its reporting framework, is set out below.

		Reporting framework	Page
General disclosures
		BP-1 and BP-2	373
		GOV-1	374
		GOV-3	383
		SBM-1	390
		SBM-2	402
		SBM-3	404
		IRO-1 and IRO-2	410
		ESRS 2 GOV-3	423
		ESRS 2 IRO-1	428
	Description of the business model:	E1-2	438
	Business environment	E1-3	441
		E1-4	448
	Organisation and structure	ESRS 2 SBM-2	462
	Markets in which it operates	ESRS 2 SBM-3	462
Business model		S1-1	463
	Objectives and strategy	S1-2	466
	Key factors and trends that could affect its future performance	S1-3	467
		S1-4	472
	Main policies applied by the Group	S1-5	478
		ESRS 2 SBM-2	493
		ESRS 2 SBM-3	493
		S4-1	501
		S4-2	504
		S4-3	505
		S4-4	508
		S4-5	513
		ESRS 2 GOV-1	515
		ESRS 2 IRO-1	515
		G1-1	515
	Internal Control and Risk Management System	GOV-5	386
		ESRS 2 IRO-1	428
Main risks and impacts identified	Analysis of risks and impacts related to key matters	S1-4	472
		S4-4	508
		G1-3	525
Environmental matters
	Detailed information about the current and foreseeable effects of the company's	SBM-3	404
	activities on the environment and, where applicable, on health and safety	IRO-1; IRO-2 and SBM-3	410
		ESRS 2 IRO-1	428
	Environmental assessment or certification procedures	E1-1	424
		E1-3	441
Environmental		GOV-1	374
management	Resources dedicated to environmental risk prevention	GOV-2	380
		E1-1	424
		E1-3	441
		ESRS 2 IRO-1	428
	Application of the precautionary principle E1-2		438
		E1-3	441
	Amount of provisions and guarantees for environmental risks	ESRS 2 IRO-1	428

Pollution	Measures to prevent, reduce or offset carbon emissions that severely affect the environment, taking into account any form of atmospheric pollution caused by a specific activity, including noise and light pollution	Non-material
Circular economy and waste prevention and	Measures on the prevention, recycling, reuse and other forms of recovery and disposal of waste	E1-3	441
management	Actions to combat food waste	Non-material
		E1-3	441
	Water consumption and water supply in accordance with local restrictions	E1-6	455
	Consumption of raw materials and measures adopted to make their use more	E1-3	441
	efficient	E1-6	455
		E1-3	441
Sustainable use of resources	Direct and indirect energy consumption	E1-5	453
		E1-6	455
	Measures taken to improve energy efficiency	E1-3	441
		E1-5	453
	Use of renewable energies	E1-3	441
	Greenhouse gas emissions generated as a result of the company's activities,	E1-5	453
		E1-3	441
	including the use of the goods it produces and the services it provides	E1-6	455
Climate change	Measures taken to adapt to the consequences of climate change	E1-3	441
	Voluntary reduction targets established for the medium and long term to reduce greenhouse gas emissions and the measures implemented for such purposes	E1-4	448
Protection of	Measures taken to preserve or restore biodiversity	Non-material
biodiversity	Impacts caused by activities or operations in protected areas	Non-material
Corporate and staff-related matters
	Total number and breakdown of employees by country, sex, age and professional category	S1-6	480
	Total number and breakdown of types of employment contract	S1-6	480
	Annual average by type of contract (permanent, temporary or part-time) and by sex, age and professional category	S1-6	480
	Number and breakdown of dismissals by sex, age and professional category	S1-6	480
	Average remuneration and its evolution, broken down by sex, age and professional category or categories of equivalent value	S1-16	487
Employment	Average remuneration of directors and senior managers, including variable pay, subsistence allowances, severance pay, payments into long-term retirement plans or any other amounts received, broken down by sex	S1-16	487
		S1-3	467
	Pay gap	S1-16	487
	Implementation of policies safeguarding employees' right to disconnect	S1-4	472
	Employees with disabilities	S1-6	480
	Total remuneration ratio	S1-16, DP 97b	491
	Organisation of working hours	S1-4	472
Workplace organisation	Number of hours of employee absence	S1-14	485
	Measures aimed at facilitating the achievement of a work-life balance and encouraging the equal enjoyment of such measures by both parents	S1-4	472
	Health and safety conditions in the workplace	S1-14	485
Health and safety	Number of work-related accidents and work-related ill health, broken down by gender, and frequency and severity rates by gender	S1-14	485
	Organisation of social dialogue, including procedures for informing and consulting with staff and for negotiating with them	S1-2	466
	Percentage of employees covered by a collective bargaining agreement, by country	S1-8	483
Workplace relations	Status of collective bargaining agreements, particularly in relation to occupational health and safety	S1-2	466
	Mechanisms and procedures that the company has in place to promote the involvement of employees in the company's management in terms of information,	S1-2	466
	consultation and participation	S1-3	467
Training	Policies implemented in relation to training	S1-4	472
	Total hours of training, broken down by professional category	S1-13	484
Accessibility	Integration and universal accessibility for people with disabilities	S1-6	480

	Measures adopted to promote equal treatment and opportunities between women	S1-3	467
	and men	S1-4	472
	Equality Plans (Chapter III of Organic Law 3/2007 of 22 March on effective equality between women and men)	S1-1	463
Equality	Measures adopted to promote employment, protocols against sexual and sex-based	S1-3	467
	harassment	S1-4	472
	Policy against all forms of discrimination and, where applicable, gender diversity	S1-1	463
	management	S1-4	472
Disclosures on respecting human rights
	Application of due diligence procedures in relation to human rights, prevention of risks of human rights violations and, where applicable, measures to mitigate,	S1-1	463
	manage and redress any such violations	S4-1	501
	Reported human rights violations	S4-4	508
Human rights		G1-1	515
	Advocacy of, and compliance with, the provisions of fundamental conventions of the International Labour Organisation related to safeguarding the freedom of association and the right to collective bargaining, elimination of workplace discrimination and job discrimination, elimination of forced or compulsory labour, effective abolition of child labour	S4-1	501
	Information regarding the fight against corruption and bribery
	Measures adopted to prevent corruption and bribery	G1-3	525
	Measures to combat money laundering	G1-1	515
Corruption and bribery		ESRS 2 SBM-3	493
	Contributions to foundations and non-profit organisations	G1-3	525
Information regarding society
	Impact of the company's activities on local employment and development	ESRS 2 SBM-3	493
		S4-4	508
The company's		ESRS 2 SBM-3	493
commitments to	Impact of the company's activities on local communities and in the area	S4-4	508
sustainable development	Relationships with key members of local communities and the different forms of	ESRS 2 SBM-3	493
	dialogue with the same	S4-4	508
	Association and sponsorship activities	Non-material
	Inclusion in the procurement policy of social, gender equality and environmental matters	G1-2	522
Outsourcing and suppliers	Consideration in relationships with suppliers and subcontractors of their social and environmental responsibilities	G1-2	522
	Supervision and audit systems and their results	G1-2	522
	Consumer health and safety measures	S4-1	501
Consumers	Grievance systems, complaints received and their resolution	S4-3	505
	Country-by-country earnings obtained
Tax information	Corporation tax paid	GRI 207-4 (in relation to net	526
	Public subsidies received	profit and taxes)
Regulation (EU) 2020/852 - Taxonomy
Requirements of the Regulation		Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation) 6.3 Taxonomy indicators	418 539

6.6 Table of datapoints associated with other European regulations

List of datapoints in cross-cutting and topical standards that derive from EU legislation other than the CSRD and the ESRS.

Disclosure requirement and related datapoint	Description	Section	SFDR90	Pillar 391	Benchmarks Regulation92	European Climate Law93
ESRS 2 GOV-1	Board's gender diversity, paragraph 21 (d)	2.1 GOV-1: The role of the administrative, management and supervisory bodies	x		x
ESRS 2 GOV-1	Percentage of Board members who are independent, paragraph 21 (e)	2.1 GOV-1: The role of the administrative, management and supervisory bodies			x
ESRS 2 GOV-4	Statement on due diligence, paragraph 30	2.4 GOV-4: Statement on due diligence	x
ESRS 2 SBM-1	Involvement in activities related to fossil fuel activities, paragraph 40 (d) (i)	3.1 SBM-1: Strategy, business model and value chain	x	x	x
ESRS 2 SBM-1	Involvement in activities related to chemicals production, paragraph 40 (d) (ii)	3.1 SBM-1: Strategy, business model and value chain	x		x
ESRS 2 SBM-1	Involvement in activities related to controversial weapons, paragraph 40 (d) (iii)	3.1 SBM-1: Strategy, business model and value chain	x		x
ESRS 2 SBM-1	Involvement in activities related to cultivation and production of tobacco, paragraph 40 (d) (iv)	3.1 SBM-1: Strategy, business model and value chain			x
ESRS E1-1	Transition plan to reach climate neutrality by 2050, paragraph 14	5.1.3.1 E1-1: Transition plan for climate change mitigation				x
ESRS E1-1	Undertakings excluded from Paris-aligned Benchmarks, paragraph 16 (g)	5.1.3.1 E1-1: Transition plan for climate change mitigation		x	x
ESRS E1-4	GHG emission reduction targets, paragraph 34	5.1.5.1. E1-4: Targets related to climate change mitigation and adaptation	x	x	x
ESRS E1-5	Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors), paragraph 38	5.1.5.2. E1-5: Energy consumption and mix	x
ESRS E1-5	Energy consumption and mix, paragraph 37	5.1.5.2. E1-5: Energy consumption and mix	x
ESRS E1-5	Energy intensity associated with activities in high climate impact sectors, paragraphs 40 to 43	5.1.5.2. E1-5: Energy consumption and mix	x
ESRS E1-6	Gross Scope 1, 2, 3 and Total GHG emissions, paragraph 44	5.1.5.3. E1-6: Gross Scopes 1, 2, 3 and Total GHG emissions	x	x	x

⁹⁰ Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (OJ L 317, 9.12.2019, p. 1)

⁹¹ Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (Capital Requirements Regulation, or CRR) (OJ L 176 27.6.2013, p. 1)

⁹² Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (OJ L 171, 29.6.2016, p. 1)

⁹³ Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 ("European Climate Law") (OJ L 243, 9.7.2021, p. 1)

Disclosure requirement and related datapoint	Description	Section	SFDR90	Pillar 391	Benchmarks Regulation92	European Climate Law93
ESRS E1-6	Gross GHG emissions intensity, paragraphs 53 to 55	5.1.5.3. E1-6: Gross Scopes 1, 2, 3 and Total GHG emissions	x	x	x
ESRS E1-7	GHG removals and carbon credits, paragraph 56	5.1.5.4. E1-7: GHG removals and GHG mitigation projects financed through carbon credits				x
ESRS E1-9	Exposure of the benchmark portfolio to climate related physical risks, paragraph 66	Information not required for 2024			x
ESRS E1-9	Disaggregation of monetary amounts by acute and chronic physical risk, paragraph 66 (a) Location of significant assets at material physical risk, paragraph 66 (c)	Information not required for 2024		x
ESRS E1-9	Breakdown of the carrying value of its real estate assets by energy-efficiency classes, paragraph 67 (c)	Information not required for 2024		x
ESRS E1-9	Degree of exposure of the portfolio to climate related opportunities, paragraph 69	Information not required for 2024			x
ESRS E2-4	Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil, paragraph 28	Non-material	x
ESRS E3-1	Water and marine resources, paragraph 9	Non-material	x
ESRS E3-1	Dedicated policy, paragraph 13	Non-material	x
ESRS E3-1	Sustainable oceans and seas, paragraph 14	Non-material	x
ESRS E3-4	Total water recycled and reused, paragraph 28 (c)	Non-material	x
ESRS E3-4	Total water consumption in m3 per net revenue on own operations, paragraph 29	Non-material	x
ESRS 2 - IRO 1 - E4	paragraph 16 (a) (i)	Non-material	x
ESRS 2 - IRO 1 - E4	paragraph 16 (b)	Non-material	x
ESRS 2 - IRO 1 - E4	paragraph 16 (c)	Non-material	x
ESRS E4-2	Sustainable land / agriculture practices or policies, paragraph 24 (b)	Non-material	x
ESRS E4-2	Sustainable oceans / seas practices or policies, paragraph 24 (c)	Non-material	x
ESRS E4-2	Policies to address deforestation, paragraph 24 (d)	Non-material	x
ESRS E5-5	Non-recycled waste, paragraph 37 (d)	Non-material	x
ESRS E5-5	Hazardous waste and radioactive waste, paragraph 39	Non-material	x

Disclosure requirement and related datapoint	Description	Section	SFDR90	Pillar 391	Benchmarks Regulation92	European Climate Law93
ESRS 2 - SBM3 - S1	Risk of incidents of forced labour, paragraph 14 (f)	5.2.2.2. ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	x
ESRS 2 - SBM3 - S1	Risk of incidents of child labour, paragraph 14 (g)	5.2.2.2. ESRS 2 SBM-3: Material impacts, risks and opportunities and their interaction with strategy and business model	x
ESRS S1-1	Human rights policy commitments, paragraph 20	5.2.3.1. S1-1: Policies related to own workforce	x
ESRS S1-1	Due diligence policies on issues addressed by the fundamental International Labour Organisation Conventions 1 to 8, paragraph 21	5.2.3.1. S1-1: Policies related to own workforce			x
ESRS S1-1	Processes and measures for preventing trafficking in human beings, paragraph 22	5.2.3.1. S1-1: Policies related to own workforce	x
ESRS S1-1	Workplace accident prevention policy or management system, paragraph 23	5.2.3.1. S1-1: Policies related to own workforce	x
ESRS S1-3	Grievance/complaints handling mechanisms, paragraph 32 (c)	5.2.3.3. S1-3: Processes to remediate negative impacts and channels for own workers to raise concerns	x
ESRS S1-14	Number of fatalities and number and rate of work related accidents, paragraph 88 (b) and (c)	5.2.4.6 S1-14: Health and safety metrics	x		x
ESRS S1-14	Number of days lost to injuries, accidents, fatalities or illness, paragraph 88 (e)	5.2.4.6 S1-14: Health and safety metrics	x
ESRS S1-16	Unadjusted gender pay gap, paragraph 97 (a)	5.2.4.8 S1-16: Compensation metrics (pay gap and total compensation)	x		x
ESRS S1-16	Excessive CEO pay ratio, paragraph 97 (b)	5.2.4.8 S1-16: Compensation metrics (pay gap and total compensation)	x
ESRS S1-17	Incidents of discrimination, paragraph 103 (a)	5.2.4.9 S1-17: Incidents, complaints and severe human rights impacts	x
ESRS S1-17	Non-respect of UNGPs on Business and Human Rights and OECD, paragraph 104 (a)	5.2.4.9 S1-17: Incidents, complaints and severe human rights impacts	x		x
ESRS 2 - SBM3 - S2	Significant risk of child labour or forced labour in the value chain, paragraph 11 (b)	Non-material	x
ESRS S2-1	Human rights policy commitments, paragraph 17	Non-material	x
ESRS S2-1	Policies related to value chain workers, paragraph 18	Non-material	x
ESRS S1-1	Non-respect of UNGPs on Business and Human Rights and OECD guidelines, paragraph 19	Non-material	x		x
ESRS S2-1	Due diligence policies on issues addressed by the fundamental International Labour Organisation Conventions 1 to 8, paragraph 19	Non-material			x

Disclosure requirement and related datapoint	Description	Section	SFDR90	Pillar 391	Benchmarks Regulation92	European Climate Law93
ESRS S2-4	Human rights issues and incidents connected to its upstream and downstream value chain, paragraph 36	Non-material	x
ESRS S3-1	Human rights policy commitments, paragraph 16	Non-material	x
ESRS S3-1	Non-respect of UNGPs on Business and Human Rights, ILO principles or OECD guidelines, paragraph 17	Non-material	x		x
ESRS S3-4	Human rights issues and incidents, paragraph 36	Non-material	x
ESRS S4-1	Policies related to consumers and end-users, paragraph 16	5.3.3.1 S4-1: Policies related to consumers and end-users	x
ESRS S4-1	Non-respect of UNGPs on Business and Human Rights and OECD guidelines, paragraph 17	5.3.3.1 S4-1: Policies related to consumers and end-users	x		x
ESRS S4-4	Human rights issues and incidents, paragraph 35	5.3.3.4 S4-4: Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions	x
ESRS G1-1	United Nations Convention against Corruption, paragraph 10 (b)	5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture	x
ESRS G1-1	Protection of whistleblowers, paragraph 10 (d)	5.4.3.2 G1-1: Corporate culture and business conduct policies and corporate culture	x
ESRS G1-4	Fines for violation of anti-corruption and anti bribery laws, paragraph 24 (a)	5.4.4.1 G1-4: Confirmed incidents of corruption or bribery	x		x
ESRS G1-4	Standards of anti-corruption and anti-bribery, paragraph 24 (b)	5.4.4.1 G1-4: Confirmed incidents of corruption or bribery	x

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