Bankinter S.A. — Annual Report 2014

Dec 31, 2014

Consolidated Financial Statements

14two thousand

Bankinter Group

Consolidated Financial Statements and Consolidated Management Report for the year ended 31 December 2014, together with the Auditor's Report

Auditor's Report	4
Consolidated Balance Sheets
Consolidated Income Statements
Consolidated StatementsofComprehensive Income
Comprehensive Statements of Changes in Consolidated Equity	7 8
Consolidated Statements of Cash Flows	10
1 Nature, activities and composition of the Group	11
2 Accounting principles used	11
3 Distribution of earnings for the year	23
4 Deposit Guarantee Fund	25
5 Accounting standards and valuation rules applied	25
6 Cash and balances at central banks	44
7 Trading portfolio of assets and liabilities and Other financial assets
and liabilities at fair value with changes through profit and loss	44
8 Available-for-sale financial assets	47
9 Held-to-maturity investments	49
10 Loans and receivables	49
11 Asset and liability hedging derivatives	53
12 Non-current assets held for sale	56
13 Investments in associates	58
14 Property, plant and equipment	70
15 Intangible assets	72
16 Reinsurance assets	74
17 Tax assets and liabilities	74
18 Other assets and other liabilities	76
19 Financial liabilities at amortised cost	76
20 Liabilities under insurance contracts	82
21 Provisions	85
22 Equity	86
23 Valuation adjustments (equity)	91
24 Offsetting of financial assets and liabilities and collateral	91
25 Contingent risks and commitments	93
26 Transfers of financial assets	93
27 Financial derivatives	97
28 Personnel expenses	97
29 Fee income and expense	106
30 Interest and similar charges/income	106

31	Gains/Losses on financial transactions	107
32	Exchange differences (net)	108
33	Other general administrative expenses	108
34	Other operating income and expenses	108
	35 Gains and losses on derecognition of assets not classified as
	non-current assets held for sale and gains and losses on non-current
	assets held for sale not classified as discontinued operations	109
36	Transactions and balances with related parties	109
37	Remuneration and balances with members of the Board of Directors	109
38	Environmental information	117
39	Customer Support service	118
40	Branches, centres and agents	119
41	Fiduciary business and investment services	120
42	Auditors' remuneration	120
43	Tax situation	121
44	Fair value of assets and liabilities	125
45	Risk policies and management	130
	46 Information required under Act 2/1981, of 25 March, on Mortgage Market
	Regulation and under Royal Decree 719/2009, of 24 April, which implements
	certain aspects of said law	150
47	Exposure to the construction and property development sector	161
	48 Additional information on risks: refinancing and restructuring
	transactions. Geographical and sector risk concentration	165
49	Information by segments	179
50	Holdings in the capital of credit institutions	179
51	Events after the reporting period	179
	Appendices
I	Transactions with related parties	180
II	Information by segment	184
III	Financial Statements of Bankinter, S.A.	187
	IV Individualised information on certain issues, buybacks
	or reimbursements of debt securities	193
	MANAGEMENT REPORT	220

BANKINTER GROUP CONSOLIDATED BALANCE SHEETS AS AT 31 December 2014 AND 2013 (€000s)

ASSETS	Note			31-12-2014 31-12-2013 (*) LIABILITIES AND EQUITY	Note		31-12-2014 31-12-2013 (*)
CASH AND BALANCES AT CENTRAL BANKS	6	357,327		886,118 LIABILITIES
FINANCIAL ASSETS HELD FOR TRADING	7	5,353,482	4,346,573
Deposits with credit institutions		544,528		920,112 FINANCIAL LIABILITIES HELD FOR TRADING	7	2,441,491	1,751,721
Loans and advances to customers		1,967,180		979,439 Deposits from credit institutions		270,621	-
Debt instruments		2,345,496		1,736,671 Customer deposits		451,559	193,482
Equity instruments		59,320		66,662 Trading derivatives		322,598	252,537
Trading derivatives		436,958		643,689 Short positions in securities		1,396,713	1,305,702
Memorandum items: Loaned or advanced as collateral		1,700,679		961,805 OTHER FINANCIAL LIABILITIES AT FAIR VALUE
OTHER FINANCIAL ASSETS AT FAIR				WITH CHANGES THROUGH PROFIT AND LOSS		-	-
VALUE THROUGH PROFIT OR LOSS	7	49,473		18,158 Customer deposits		-	-
Equity instruments		49,473		18,158 FINANCIAL LIABILITIES AT AMORTISED
Memorandum items: Loaned or advanced as collateral		-		- COST	19	49,990,680	48,986,085
				Deposits from central banks		3,240,433	3,243,794
AVAILABLE-FOR-SALE FINANCIAL ASSETS	8	3,013,813		2,483,171 Deposits from credit institutions		5,249,425	4,587,188
Debt instruments		2,845,308		2,321,671 Customer deposits		29,966,129	29,624,282
Equity instruments		168,505		161,500 Marketable debt securities		9,311,034	9,516,372
Memorandum items: Loaned or advanced as collateral		746,292		799,412 Subordinated liabilities		608,198	612,438
				Other financial liabilities		1,615,461	1,402,011
LOANS AND RECEIVABLES	10	44,006,521	42,607,050
Deposits with credit institutions		1,113,441		1,182,215 MACRO-HEDGING ADJUSTMENTS TO
Loans and advances to customers		42,446,723		41,307,010 FINANCIALLIABILITIES		-	-
Debt instruments		446,357	117,825
Memorandum items: Loaned or advanced as collateral		356,515		365,847 HEDGING DERIVATIVES	11	20,241	25,608
HELD TO MATURITY INVESTMENTS	9	2,819,482		3,220,721 LIABILITIES ASSOCIATED WITH NON-CURRENT ASSETS HELD FOR SALE		-	-
Memorandum items: Loaned or advanced as collateral		2,805,745	2,886,655
				LIABILITIES UNDER INSURANCE CONTRACTS	20	614,780	607,794
MACRO-HEDGING ADJUSTMENTS TO FINANCIAL ASSETS		-		- PROVISIONS	21	88,236	53,753
				Pension funds and similar obligations		818	1,456
HEDGING DERIVATIVES	11	148,213		84,481 Provisions for contingent risks and commitments		7,499	8,642
				Other provisions		7,141	4,697
NON-CURRENT ASSETS HELD FOR SALE	12	356,671		369,210 Allowances for taxes and other legal contingencies		72,778	38,958
INVESTMENTS	13	29,726		36,362 TAX LIABILITIES	17	312,416	217,766
Associates		28,857		35,932 Current		135,054	68,119
Jointly controlled entities		869		430 Deferred		177,362	149,647
PENSION-LINKED INSURANCE AGREEMENTS	28	714		1,327 OTHER LIABILITIES	18	221,686	162,744
REINSURANCE ASSETS	16	3,006		3,244 TOTAL LIABILITIES		53,689,530	51,805,471
TANGIBLE ASSETS	14	467,362		434,931 EQUITY		3,643,445	3,352,197
Property, plant and equipment		412,838		421,887 EQUITY	22	3,513,914	3,309,025
For internal use		388,181	394,933 Capital			269,660	268,675
Assigned on lease		24,657		26,954 Registered		269,660	268,675
Real estate investments		54,524		13,044 Issue premium		1,184,268	1,172,645
Memorandum item: acquired under finance lease		-		- Reserves		1,853,783	1,718,309
				Accumulated reserves (losses)		1,860,226	1,713,628
INTANGIBLE ASSETS	15	282,327		300,703 Accumulated reserves (losses) of entities accounted for using the equity method		(6,440)	4,681
Goodwill		164,113		164,281 Other equity instruments		-	12,609
Other intangible assets		118,214		136,422 Remaining equity instruments		-	12,609
TAX ASSETS	17	298,172		237,951 Less: treasury shares		(771)	(511)
Current		154,294		105,651 Profit (loss) attributable to owners of the parent company		275,887	189,900
Deferred		143,878		132,300 Less: dividends and remuneration		(68,913)	(52,602)
OTHER ASSETS	18	146,685		127,668 VALUATION ADJUSTMENTS	23	129,531	43,172
Other		146,685		127,668 Financial assets available for sale		123,727	41,605
				Exchange differences		220	201
				Other valuation adjustments		1,162
				Entities valued under the equity method		4,422	1,366
				MINORITY INTERESTS
TOTAL ASSETS		57,332,974		55,157,668 TOTAL LIABILITIES AND EQUITY		57,332,974	55,157,668
MEMORANDUM ITEMS:
CONTINGENT RISKS	25	2,736,529	2,401,895
CONTINGENT COMMITMENTS	25	13,527,713	13,548,719

(*) Shown solely for purposes of comparison.

BANKINTER GROUP CONSOLIDATED INCOME STATEMENTS FOR THE YEARS ENDED 31 December 2014 AND 2013 (€000s)

			(Debit) Credit
	Note	2014	2013 (*)
INTEREST AND SIMILAR INCOME	30	1,404,321	1,476,230
INTEREST EXPENSE AND SIMILAR CHARGES	30	(648,963)	(840,326)
NET INTEREST INCOME		755,358	635,904
INCOME FROM EQUITY INSTRUMENTS		8,004	8,946
SHARE OF RESULTS OF ENTITIES ACCOUNTED FOR USING THE EQUITY METHOD	22	16,962	15,545
FEES AND COMMISSIONS INCOME	29	365,298	313,082
FEES AND COMMISSIONS EXPENSE	29	(73,891)	(64,063)
RESULT OF FINANCIAL OPERATIONS (net)	31	90,084	188,664
Held for trading		14,982	18,163
Other financial assets at fair value through profit and loss		1,163	8,228
Financial instruments not measured at fair value through profit and loss		74,058	162,907
Other		(119)	(634)
EXCHANGE DIFFERENCES (net)	32	43,211	40,090
OTHER OPERATING INCOME	34	682,500	676,019
Income from insurance and reinsurance policies issued		651,549	652,217
Other operating income		30,951	23,802
OTHER OPERATING EXPENSES	34	(438,703)	(475,188)
Expenses on insurance and reinsurance policies		(362,487)	(380,758)
Other operating expenses		(76,216)	(94,430)
GROSS INCOME		1,448,823	1,338,999
ADMINISTRATIVE COST		(655,473)	(616,759)
Personnel expenses	28	(368,738)	(356,833)
Other general administrative expenses	33	(286,735)	(259,926)
DEPRECIATION AND AMORTISATION	14/15	(63,773)	(63,088)
PROVISIONS (NET)	21	(41,536)	(14,259)
IMPAIRMENT LOSSES ON FINANCIAL ASSETS (NET)		(237,390)	(290,202)
Loans and receivables	10	(233,874)	(280,840)
Other financial instruments not measured at fair value through profit and loss	8	(3,516)	(9,362)
PROFIT FROM OPERATIONS		450,651	354,691
IMPAIRMENT LOSSES ON OTHER ASSETS (net)		(118)	(327)
Goodwill and other intangible assets		(168)
Other assets		50	(327)
GAINS / LOSSES ON DERECOGNITION OF ASSETS NOT CLASSIFIED AS NON-CURRENT ASSETS HELD FOR SALE	35	(2,980)	(1,848)
NEGATIVE GOODWILL ON BUSINESS COMBINATIONS		-	1,379
GAINS / LOSSES ON NON-CURRENT ASSETS HELD FOR SALE NOT CLASSIFIED AS DISCONTINUED OPERATIONS	35	(54,714)	(92,791)
PROFIT BEFORE TAX		392,839	261,104
INCOME TAX	43	(116,952)	(71,204)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS		275,887	189,900
PROFIT (LOSS) FROM DISCONTINUED OPERATIONS (net)		-	-
CONSOLIDATED PROFIT FOR THE YEAR		275,887	189,900
Profit (loss) attributable to owners of the parent company		275,887	189,900
Profit (loss) attributable to non-controlling interests
EARNINGS PER SHARE
Basic earnings (euros)		0.31	0.24
Diluted earnings (euros)		0.31	0.23

(*) Shown solely for purposes of comparison.

Notes 1 to 51 contained in the report and Appendices I to V form an integral part of the consolidated income statement for the year ended 31 December 2014.

BANKINTER GROUP COMPREHENSIVESTATEMENTS OF CONSOLIDATEDINCOME FORTHE YEARS ENDED 31 December 2014 AND 2013(€000s)

2014 2013 (*) CONSOLIDATED PROFIT FOR THE YEAR 275,887 189,900 OTHER COMPREHENSIVE INCOME 86,359 40,120 Items that will not be reclassified to profit and loss; 1,162 - Actuarial gains and losses on defined benefit plans 1,659 - Non-current assets held for sale - - Entities valued under the equity method - - Income tax relating to items that will not be reclassified to profit and loss (497) - 85,197 40,120 Items that may be reclassified to profit and loss; 117,317 54,944 Financial assets available for sale Gains (losses) on valuation 159,725 161,238 Amounts transferred to profit and loss (42,408) (106,294) Other reclassifications - - Cash flow hedging - - Gains (losses) on valuation - - Amounts transferred to profit and loss - - Amounts transferred to the initial value of hedged items - - Other reclassifications - - Hedging of net investments in foreign operations - - Gains (losses) on valuation - - Amounts transferred to profit and loss - - Other reclassifications Exchange differences 27 (11) Gains (losses) on translation 27 (11) Amounts transferred to profit and loss - - Other reclassifications - - Non-current assets for sale - - Gains (losses) on valuation - - Amounts transferred to profit and loss - - Other reclassifications - - Actuarial gains (losses) on pension plans - - Entities accounted for using the equity method 3,056 1,667 Gains (losses) on valuation 3,056 1,667 Amounts transferred to profit and loss - - Other reclassifications - - Statement of comprehensive income - - Income tax (35,203) (16,480) TOTAL COMPREHENSIVE INCOME 362,246 230,020 Attributable to owners of the parent company 362,246 230,020 Attributable to non-controlling interests - -	Financial year	Financial year

(*) Shown solely for purposes of comparison.

Notes 1 to 51 contained in the attached report and Appendices I to V form an integral part of the consolidated statement of comprehensive income for the year ended 31 December 2014.

BANKINTER GROUP CONSOLIDATED STATEMENTS OF CHANGES IN NET WORTH FOR THE YEARS ENDED 31 DECEMBER 2014 AND 2013(€000s)

		EQUITY ATTRIBUTABLE TO OWNERSOFTHE PARENT COMPANY
		EQUITY
	Capital	Issue premium	Accumulated reserves (losses)	Other equity instruments	Less: Treasury Shares	End of-year results attributed to the parent company	Less: Dividends and remunerations Total Equity		Valuation adjustments	Total	Non controlling interests	Total net worth
Opening balance at 31/12/2013		268,675 1,172,645 1,744,134		12,609	(511)	215,424	(52,602)	3,360,373	43,172	3,403,545	-	3,403,545
Adjustments due to changes in accounting criteria	-	-	(25,824)		-	(25,524)	-	(51,348)	-	(51,348)	-	(51,348)
Adjustments due to errors	-	-	-		-	-	-	-	-	-	-	-
Adjusted opening balance		268,675 1,172,645 1,718,310		12,609	(511)	189,900	(52,602)	3,309,025	43,172	3,352,197	-	3,352,197
Total comprehensive income	-	-	-	-	-	275,887	-	275,887	86,359	362,246	-	362,246
Other changes in equity	985	11,623	135,473	(12,609)	(260)	(189,900)	(16,311)	(70,998)	-	(70,998)	-	(70,998)
Increases in capital/endowment fund	985	11,623	-	(12,609)	-	-	-	-	-	-	-	-
Capital reductions	-	-	-		-	-	-	-	-	-	-	-
Conversion of financial liabilities into capital	-	-	-	-	-	-	-	-	-	-	-	-
Increases in other equity instruments	-	-	-	-	-	-	-	-	-	-	-	-
Reclassification of financial liabilities to other equity instruments	-	-	-		-	-	-	-	-	-	-	-
Reclassification of other equity instruments to financial liabilities	-	-	-		-	-	-	-	-	-	-	-
Distribution of dividends / Shareholder remuneration	-	-	-		-	-	(70,167)	(70,167)	-	(70,167)	-	(70,167)
Operations with shares / contributions to equity (net)	-	-	846		(260)	-	-	586	-	586	-	586
Transfer between net worth entries	-	-	136,044		-	(189,900)	53,856	-	-	-	-	-
Increases (reductions) in equity due to business combinations (net)	-	-	-		-	-	-		-		-
Discretionary contributions to social funds and projects (Savings banks)	-	-	-		-	-	-	-	-	-	-	-
Payments with equity instruments	-	-	(205)		-	-	-	(205)	-	(205)	-	(205)
Other increases (reductions) in equity	-	-	(1,212)		-	-	-	(1,212)	-	(1,212)	-	(1,212)
Closing balance at 31/12/2014		269,660 1,184,268 1,853,783		-	(771)	275,887	(68,913)	3,513,914	129,531	3,643,445	-	3,643,445

BANKINTER GROUP CONSOLIDATED STATEMENTS OF CHANGES IN NET WORTH FOR THE YEARS ENDED 31 DECEMBER 2014 AND 2013 (€000s)

			EQUITY ATTRIBUTABLE TO OWNERSOFTHE PARENT COMPANY
					EQUITY
		Issue	Accumulated	Other equity instruments	Less: Treasury	End-of-year results attributed to the	Less: Dividends		Valuation		Non-controlling
Opening balance at 31/12/2012	Capital	premium 169,142 1,118,186	reserves (losses) 1,789,781	72,633	Shares (226)	parent company 124,654	and remunerations (46,125)	Total Equity 3,228,045	adjustments 3,052	Total 3,231,097	interests -	Total net worth 3,231,097
Adjustments due to changes in accounting criteria	-	-	(24,956)		-	(868)	-	(25,824)	-	(25,824)	-	(25,824)
Adjustments due to errors	-	-	-		-	-	-	-	-	-	-	-
Adjusted opening balance		169,142 1,118,186	1,764,825	72,633	(226)	123,786	(46,125)	3,202,221	3,052	3,205,273	-	3,205,273
Total comprehensive income	-	-	-	-	-	189,900	-	189,900	40,120	230,020	-	230,020
Other changes in equity	99,533	54,459	(46,516)	(60,024)	(285)	(123,786)	(6,477)	(83,096)	-	(83,096)	-	(83,096)
Increases in capital/endowment fund	99,533	54,459	(93,967)	(60,024)	-	-	-	1	-	1	-	1
Capital reductions	-	-	-		-	-	-	-	-	-	-	-
Conversion of financial liabilities into capital	-	-	-	-	-	-	-	-	-	-	-	-
Increases in other equity instruments	-	-	-	-	-	-	-	-	-	-	-	-
Reclassification of financial liabilities to other equity instruments	-	-	-		-	-	-	-	-	-	-	-
Reclassification of other equity instruments to financial liabilities	-	-	-		-	-	-	-	-	-	-	-
Distribution of dividends / Shareholder remuneration	-	-	-		-	-	(67,977)	(67,977)	-	(67,977)	-	(67,977)
Operations with shares / contributions to equity (net)	-	-	924		(285)	-	-	639	-	639	-	639
Transfer between net worth entries	-	-	62,285		-	(123,786)	61,500	(1)	-	(1)	-	(1)-
Increases (reductions) in equity due to business combinations (net)	-	-	-		-	-	-		-		-
Discretionary contributions to social funds and projects (Savings banks)	-	-	-		-	-	-	-	-	-	-	-
Payments with equity instruments	-	-	(16,970)		-	-	-	(16,970)	-	(16,970)	-	(16,970)
Other increases (reductions) in equity	-	-	1,212		-	-	-	1,212	-	1,212	-	1,212
Closing balance as at 31/12/2013		268,675 1,172,645	1,718,309	12,609	(511)	189,900	(52,602)	3,309,025	43,172	3,352,197	-	3,352,197

(*) Shown solely for the purpose of comparison

Notes 1 to 51 contained in the attached report and Appendices I to V form an integral part of the consolidated statement of changes in equity for the year ended 31 December 2014.

BANKINTER GROUP CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED 31 December 2014 AND 2013 (€000s)

2014 2013(*) NET CASH FLOW FROM OPERATINGACTIVITIES (805,032) 846,619 Consolidated profit for the year 275,887 189,900 Adjustments to obtain cash flow from operating activities 497,405 471,645 Depreciation and Amortisation 63,773 63,088 Other adjustments 433,631 408,558 3,381,097 3,439,237 Net increase/decrease in operating assets Held for trading (1,006,909) (2,237,308) Other financial assets at fair value through profit or loss (31,315) 21,703 Financial assets available for sale (416,840) 3,694,903 Loans and receivables (1,781,966) 1,907,794 Other operating assets (144,066) 52,146 1,697,794 (3,303,671) Net increase/decrease in operating liabilities Held for trading 689,769 (45,602) Other financial liabilities at fair value through profit or loss - - Financial liabilities at amortised cost 871,282 (3,255,277)
Other operating liabilities 136,742 (2,792)
Corporation tax collections/payments 104,979 49,507
NET CASH FLOW FROM INVESTING ACTIVITIES 517,966 (350,650)
Payments (110,341) (530,362)
Tangible assets (83,976) (27,174)
Intangible assets (13,275) (12,758)
Investments (13,090) (23,025)
Non-current assets held for sale and associated liabilities - -
Held to maturity investments - (467,405)
Collections 628,307 179,712
34,627 Tangible assets 1,035
Intangible assets - -
Investments - -
Non-current assets held for sale and associated liabilities 193,934 178,677
Held to maturity investments 399,746 -
(175,643) (174,876) NET CASH FLOW FROM FINANCING ACTIVITIES
Payments (225,995) (213,254)
Dividends (90,097) (63,441)
Subordinated liabilities (86,300) (111,348)
Acquisition of own equity instruments (49,598) (38,465)
Other payments linked to financing activities - -
Collections 50,352 38,378
Subordinated liabilities - -
Issue of own equity instruments - -
Disposal of own equity instruments 50,352 38,378
- - Other inflows linked to financing activities
EFFECT OF EXCHANGE-RATE VARIATIONS - -
NET INCREASE/DECREASE IN CASH AND CASHEQUIVALENTS (A+B+C+D) (462,708) 321,093
1,341,412 1,020,319 CASH AND CASHEQUIVALENTS AT START OF PERIOD
CASH AND CASH EQUIVALENTS AT END OF PERIOD 878,704 1,341,412
MEMORANDUM ITEMS:
878,704 1,341,412 BREAKDOWN OF CASH AND CASH EQUIVALENTS AT END OF PERIOD
Cash 139,512 118,909
Balances equivalent to cash at central banks 217,555 767,209
Other financial assets 521,636 455,294
Total cash and cash equivalents at end of period 878,704 1,341,412

(*) Shown solely for the purpose of comparison

Notes 1 to 51 to the consolidated financial statements and Appendices I to V form an integral part of the consolidated statement of cash flows for the year ended 31 December 2014.

1. Nature of the Group and its activities and composition

Bankinter, S.A. was incorporated by public deed executed in Madrid on 4 June 1965 under the name Banco Intercontinental Español, S.A. Its name was changed to the current one on 24 July 1990. It is registered in the Special Registry of Banks and Bankers. Its tax identification number is A-28157360 and it belongs to the Deposit Guarantee Fund under code number 0128. Its registered offices are located at Paseo de la Castellana 29, 28046 Madrid, Spain. The LEI (Legal Entity Identifier) of Bankinter, S.A. is VWMYAEQSTOPNV0SUGU82.

The corporate object of Bankinter, S.A. (hereinafter referred to as the Bank or the Entity) comprises banking activities subject to the rules and regulations governing banks operating in Spain.

In addition to the operations which it carries on directly, the Bank is the parent company of a group of subsidiary companies dedicated to a variety of activities (basically investment services asset management, credit cards and the insurance business) which, together with the Bank, make up the Bankinter Group (hereinafter referred to as the 'Group' or the 'Bankinter Group'). Consequently, in addition to its own individual financial statements, the Bank is obliged to draw up consolidated financial statements for the Group, which also include holdings in joint businesses and investments in associates.

The subsidiaries forming the Bankinter Group are listed in Note 13 'Investments'.

The Group's consolidated financial statements have been drawn up in accordance with the accounting principles described in the section "Accounting principles and Valuation Rules Applied."

The balance sheets of Bankinter, S.A. as at 31 December 2014 and 2013 and the income statements for the years then ended are shown in Appendix III.

2. Accounting principles applied

a) Rules for the presentation of the annual accounts

In accordance with EC Regulation No. 1606/2002 of the European Parliament and of the Council of 19 July 2002, all companies governed by the law of a member state of the European Union and whose securities are admitted to trading on a regulated market of any member state must present their consolidated financial statements for each financial year starting on or after 1 January 2005 in accordance with the International Financial Reporting Standards (IFRS) previously adopted by the European Union.

To adapt the accounting system of Spanish credit institutions to the new regulations, Banco de España published Circular 4/2004 of 22 December on Rules for Public and Reserved Financial Information and Model Financial Statements.

The Group's consolidated financial statements for the year ended 31 December 2014 were approved by the Bank's Directors in a meeting of the Board of Directors held on 17 February 2015, in accordance with the regulatory framework applying to the Group as established in the Spanish Commercial Code and other commercial legislation and with the International Financial Reporting Standards adopted by the European Union and taking account of Banco de España Circular 4/2004 applying the principles of consolidation, accounting policies, and valuation criteria described in Note 5 to the consolidated financial statements so as to give a true and fair view of the Group's financial situation as at 31 December 2014 and of the results of its operations, its comprehensive income and cash flows for 2014. These financial statements for 2014 are pending approval by the General Meeting of Shareholders. However, the Bank's Board of Directors believes that these accounts will be approved without modifications.

The Group's consolidated financial statements for 2013 were approved by the General Meeting of Shareholders held on 20 March 2014.

In accordance with the options established in IAS 1.81, the Group has opted to present separate statements, one displaying components of consolidated results ("Consolidated income statement") and a second statement which, beginning with those consolidated results, displays components of other comprehensive income ("Statement of comprehensive income"). In Spanish it is referred to using the terminology of Bank of Spain Circular 4/2004.

All figures in this report referring to financial year 2013 are presented solely for purposes of comparison.

The accounting policies and methods used to prepare these financial statements are the same as those applied in drawing up the consolidated financial statements for 2013, taking account of the standards and interpretations that came into effect in 2014. In this respect we would highlight the following:

Changes in accounting principles during the reporting period

Regulation (EC) 634/2014 adopted IFRIC (International Financial Reporting Interpretations Committee) interpretation 21 with regard to levies for financial years starting on or after 17 June 2014 at the latest, with early adoption allowed.

The Bank has made use of this early adoption option, which involves a change to its accounting policies for this financial year that must be applied retroactively. The retroactive application of a new accounting criterion involves adjusting the element amounts affected in the opening balance sheet for the oldest period on which comparative information is published, as well as the item amounts for the different stages affected by the change that are published for comparative purposes, including the notes from the report, as if the new accounting criterion had always been implemented.

The main effect of this change of accounting principle concerns the recognition of ordinary and extraordinary contributions to the Deposit Guarantee Fund.

• a) Extraordinary contributions to the DGF: the adoption of the IFRIC 21 involved the present value of all pending payments (€28,443,000) being recognised as a liability, the balancing entry being a debit to the reserves in the opening balance sheet for 2014, and the total amount of the extraordinary contribution being recognised as expense for 2013, a difference of €32,338,000. Consequently the financial statements affected and the notes thereto have been adjusted for purposes of comparison.
• b) Ordinary contributions to the DGF: the adoption of IFRIC 21 involves the ordinary contribution corresponding to deposits as at 31 December 2014 (€44,911,000) being charged to profit and loss for 2014. Recognition of the contribution for 2013, paid in 2014 (€41,016,000), and the contribution for 2012, paid in 2013 (€36,893,000), has been changed retroactively so as to record the expense in 2013 and 2012 respectively. With the previous accounting criterion these two contributions would have been recorded in financial years 2013 and 2014, respectively.

The following tables show the impacts described on the opening balance sheet of 2014 and on the income statement for 2013 adjusted for purposes of comparison:

		Adjustments due to changes in accounting
ASSETS	Closing balance sheet 31 Dec. 2013	Extraordinary contributions to the DGF	principle Ordinary contributions to the DGF	TOTAL	Opening balance sheet 1 Jan. 2014
CASH AND BALANCES AT CENTRAL BANKS	886,118				886,118
FINANCIAL ASSETS HELD FOR TRADING	4,346,573				4,346,573
OTHER FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS	18,158				18,158
AVAILABLE-FOR-SALE FINANCIAL ASSETS	2,483,171				2,483,171
LOANS AND RECEIVABLES	42,607,050				42,607,050
HELD TO MATURITY INVESTMENTS	3,220,721				3,220,721
MACRO-HEDGING ADJUSTMENTS TO FINANCIAL ASSETS	-				-
HEDGING DERIVATIVES	84,481				84,481
NON-CURRENT ASSETS HELD FOR SALE	369,210				369,210
INVESTMENTS	36,362				36,362
PENSION-LINKED INSURANCE AGREEMENTS	1,327				1,327
REINSURANCE ASSETS	3,244				3,244
TANGIBLE ASSETS	434,931				434,931
INTANGIBLE ASSETS	300,703				300,703
TAX ASSETS	215,945	9,701	12,305	22,006	237,951
OTHER ASSETS	127,668				127,668
TOTAL ASSETS	55,135,662	9,701	12,305	22,006	55,157,668
LIABILITIES AND EQUITY
FINANCIAL LIABILITIES HELD FOR TRADING	1,751,721				1,751,721
OTHER FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT AND LOSS	-				-
FINANCIAL LIABILITIES AT AMORTISED COST	48,912,731	32,338	41,016	73,354	48,986,085
MACRO-HEDGING ADJUSTMENTS TO					-
MACRO-HEDGING ADJUSTMENTS TO FINANCIALLIABILITIES	-				-
HEDGING DERIVATIVES	25,608				25,608
LIABILITIES ASSOCIATED WITH NON-CURRENT ASSETS HELD FOR SALE	-				-
LIABILITIES UNDER INSURANCE CONTRACTS	607,794				607,794
PROVISIONS	53,753				53,753
TAX LIABILITIES	217,766				217,766
OTHER LIABILITIES	162,744				162,744
TOTAL LIABILITIES	51,732,117	32,338	41,016	73,354	51,805,471
EQUITY	3,360,373	(22,637)	(28,711)	(51,348)	3,309,025
VALUATION ADJUSTMENTS	43,172				43,172
MINORITY INTERESTS					-
TOTAL LIABILITIES AND EQUITY	55,135,662	9,701	12,305	22,006	55,157,668

		Adjustments due to changes in accounting principle
	2013	Extraordinary contributions to the DGF	Ordinary contributions to the DGF	TOTAL	Results for 2013 Restated
INTEREST AND SIMILAR INCOME	1,476,230				1,476,230
INTEREST EXPENSE AND SIMILAR CHARGES	(840,326)				(840,326)
NET INTEREST INCOME	635,904				635,904
INCOME FROM EQUITY INSTRUMENTS	8,946				8,946
SHARE OF RESULTS OF ENTITIES ACCOUNTED FOR USING THE EQUITY METHOD	15,545				15,545
FEES AND COMMISSIONS INCOME	313,082				313,082
FEES AND COMMISSIONS EXPENSE	(64,063)				(64,063)
RESULT OF FINANCIAL OPERATIONS (net)	188,664				188,664
EXCHANGE DIFFERENCES (net)	40,090				40,090
OTHER OPERATING INCOME	676,019				676,019
OTHER OPERATING EXPENSES	(438,726)	(32,338)	(4,123)	(36,462)	(475,188)
GROSS INCOME	1,375,461	(32,338)	(4,123)	(36,462)	1,338,999
ADMINISTRATIVE COST	(616,759)				(616,759)
DEPRECIATION AND AMORTISATION	(63,088)				(63,088)
PROVISIONS (NET)	(14,259)				(14,259)
IMPAIRMENT LOSSES ON FINANCIAL ASSETS (NET)	(290,202)				(290,202)
PROFIT FROM OPERATIONS	391,153	(32,338)	(4,123)	(36,462)	354,691
IMPAIRMENT LOSSES ON OTHER ASSETS (net)	(327)				(327)
GAINS / LOSSES ON DERECOGNITION OF ASSETS NOT CLASSIFIED AS NON-CURRENT ASSETS HELD FOR SALE	(1,848)				(1,848)
NEGATIVE GOODWILL ON BUSINESS COMBINATIONS	1,379				1,379
GAINS / LOSSES ON NON-CURRENT ASSETS HELD FOR SALE NOT CLASSIFIED AS DISCONTINUED OPERATIONS	(92,791)				(92,791)
PROFIT BEFORE TAX	297,566	(32,338)	(4,123)	(36,462)	261,104
INCOME TAX	(82,142)	9,701	1,237	10,938	(71,204)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS	215,424	(22,637)	(2,886)	(25,523)	189,900
PROFIT (LOSS) FROM DISCONTINUED OPERATIONS (net)	-				-
CONSOLIDATED PROFIT FOR THE YEAR	215,424	(22,637)	(2,886)	(25,523)	189,900

Standards and interpretations effective in the year under review

Changes made in 2014

In 2014 the following amendments to IFRS and interpretations thereof (IFRIC) came into force. None of them had a significant impact on the Group's consolidated financial statements for the year.

• Amendment to IAS 32 - Financial instruments: Presentation

The amendments to IAS 32 clarify the following aspects relating to the offsetting of assets and liabilities:

• The legal right to offset recognised amounts must not depend on a future event and must be legally executable in all circumstances, including cases of non-payment or insolvency of either party.
• Settlements meeting the following conditions will be accepted as equivalent to "settlements for net amount": all, or practically all the credit and liquidity risk is eliminated; and assets and liabilities are settled in a single process.
• • Amendment to IFRS 10 Consolidated financial statements, IFRS 12 Disclosure of interest in other entities and IAS 27 – Consolidated and separate financial statements

The amendments to IFRS 10, IFRS 12 and IAS 27 define investment entities and establish that they are to be exempt from the obligation of consolidating their investments, which will be accounted for at fair value through profit and loss in accordance with IFRS 9.

However, the parent of an investment entity must consolidate all entities which it controls, including those that it controls through an investment entity, except if the parent itself is an investment entity.

They also include new disclosure requirements allowing users to evaluate the nature and financial effects of investments made by investment entities.

• IFRIC 21 Levies

This interpretation clarifies that for levies accounted for within the scope of IAS 37 'Provisions, contingent liabilities and contingent assets', and for obligations to pay levies where the amount and date of payment are certain, the obligation must be recognised when the obligating event occurs.

Therefore the obligation to pay will be recognised when there is a present obligation to pay the levy. In cases where the obligation to pay accrues over a period, it must be recognised progressively over the course of that period; and if the obligation to pay is activated by reaching a certain level, for example of revenues, the obligation must be recognised when that level is reached.

This interpretation does not affect taxes covered by other IFRS, such as corporate income tax, nor does it affect fines or sanctions for legal infractions.

The European Union has adopted IFRIC 21 with mandatory effect for financial years starting after 17 June 2014, early adoption being permitted. The Group decided to early adopt this interpretation, as indicated in section n) of this Note.

Amendment to IAS 36 - Impairment of assets

Until now IAS 36 required disclosure of information on the recoverable amount of each CGU for which the carrying amount of goodwill or intangible assets with an indefinite useful was significant in relation to the entity's total goodwill or intangible assets with an indefinite useful life.

The amendments to IAS 36 replace this obligation with the obligation to disclose information on the recoverable amount of the assets (including goodwill and CGUs) in respect of which impairment has been recognised or reversed in the reporting period. Furthermore, when the recoverable amount is equal to the fair value less selling costs, additional information must be provided.

• Amendment to IAS 39 - Financial instruments: Recognition and measurement. Novation of derivatives and continuation of hedge accounting

The new IAS 39 introduces an exception to the application of discontinuance of hedge accounting for novations in which, as a result of some law or regulation, the original counterparty of the hedged item is replaced by one or more central counterparties, such as clearing houses, and providing no changes are made to the hedged item other than those strictly necessary in order to be able to change the counterparty.

• IFRS annual improvement project 2010-2012 – Minor amendments to IFRS 2 and IFRS 3

The IFRS annual improvement project for 2010-2012 introduces minor amendments and clarifications to IFRS 2 – Share-based payments and IFRS 3 – Business combinations, applicable to transactions and business combinations carried out from 1 July 2014 on.

Standards and interpretations issued but not yet effective as at 30 September 2014.

In 2014 the following standards, amendments and interpretations had been published by the IASB and approved by the European Union, but were not yet mandatory:

• IFRS 9 - Financial instruments:

On 24 July 2014 the IASB issued IFRS 9, which will replace IAS 39 in the future. There are significant changes from the present standard. IFRS 9 requires financial assets to be classified into just two measurement categories: those measured at fair value and those measured at amortised cost. The current categories "Held-to-maturity investments" and "Availablefor-sale financial assets" will no longer exist. Impairment will in effect apply only to assets recognised at amortised cost, and embedded derivatives will no longer be separately accounted for.

The categories proposed by IFRS 9 for financial liabilities are similar to those already existing in IAS 39, so there should not be any significant differences except for those resulting from the requirement to recognise changes in fair value relating to the actual credit risk directly in equity in the case of financial liabilities measured at fair value.

Accounting for hedges will also involve changes, since the IFRS 9 approach differs from that of the present IAS 39 in seeking to align the accounting with the economic management of the risk.

The IASB has set 1 January 2018 as the mandatory effective date, with early adoption permitted.

• IFRS 7 as amended - "Financial instruments: Disclosures:"

The IASB amended IFRS 7 in December 2011 to introduce new disclosures on the financial instruments that entities will have to present in the year in which they first adopt IFRS 9.

• IAS 19 as amended - "Employee benefits. Employee contributions to defined benefit plans"

The amendment to IAS 19 concerns accounting for contributions to defined benefit plans, to make it easier for these contributions to be deducted from the cost of the service in the same period as that in which they are paid, providing certain requirements are met, without the need to perform calculations in order to relate the reduction to each year of service.

This amendment will apply to years starting on 1 July 2014 or later, although early adoption is permitted.

• IFRS annual improvement project 2010-2012 – Minor amendments to IFRS 8, IFRS 13, IAS 16, IAS 24 and IAS 38

The IFRS annual improvement project 2010-2012 introduces minor amendments and clarifications to IFRS 2 – Share-base payments, IFRS 3 – Business combinations, IFRS 8 – Operating segments, IFRS 13 – Fair value measurement, IAS 16 – Property, plant and equipment, IAS 24 – Related party disclosures and IAS 38 – Intangible assets, which will apply to financial years starting on 1 July 2014 or later, with early adoption permitted.

• IFRS annual improvement project 2011-2013

The IFRS annual improvement project 2011-2013 introduces minor amendments and clarifications to IFRS 1 – First-time adoption of IFRS, IFRS 3 – Business combinations, IFRS 13 – Fair value measurement and IAS 40 – Investment property.

This amendment will apply to years starting on 1 July 2014 or later, although early adoption is permitted.

• Amendment to IFRS 11 – Joint Arrangements

The amendment to IFRS 11 provides new guidance on how to account for the acquisition of an interest in a joint venture operation that constitutes a business, whereby they are to be accounted for applying the principle of IFRS 3 – Business combinations.

This amendment will apply to years starting on 01 January 2016 or later, although early adoption is permitted.

• Amendment to IAS 16 – "Property, plant and equipment" and IAS 38 as amended – "Intangible assets"

The amendment to IAS 16 and IAS 38 clarifies that revenue-based methods should not be used to calculate the depreciation or amortisation of an asset, because in most cases these methods do not reflect the way the economic benefits embodied in the asset are expected to be consumed.

This amendment will apply to years starting on 01 January 2016 or later, although early adoption is permitted.

• IFRS 15 – "Revenue from contracts with customers"

IFRS 15 establishes the principles to be applied in recognising revenue and cash flows arising from contracts for the sale of goods or services to customers.

According to this new standard, revenue will be recognised when the goods or services have been transferred to the customer in accordance with the terms of the contract, i.e. when the customer obtains control of the goods or services. The amount to be recognised is that of the payment to which the entity expects to be entitled in consideration of the goods or services transferred.

IFRS 15 replaces IAS 18 – Revenue, IAS 11 – Construction contracts, IFRIC 13 – Customer loyalty programmes, IFRIC 15 – Agreements for the construction of real estate, IFRIC 18 – Transfers of assets from customers and SIC 31 – Revenue: barter transactions involving advertising services.

This amendment will apply to financial years starting on 1 January 2017 or later, although early adoption is permitted.

• Amendment to IAS 27 – Consolidated and Individual Financial Statements

The amendment to IAS 27 allows entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements.

This amendment will apply to years starting on 1 January 2016 or later, using the equity method.

• Amendment to IFRS 10 – Consolidated Financial Statements" and IAS 28

The amendments to IFRS 10 and IAS 28 establish that when an entity sells or contributes assets constituting a business (including its consolidated subsidiaries) to a group company or joint venture, it must recognise the gains or losses on the transaction in full. However, if the assets sold or contributed do not constitute a business, the gains or losses must be recognised only in proportion to the holding which other investors not related to the entity have in the associate or joint venture.

This amendment will apply to years starting on 01 January 2016 or later, although early adoption is permitted.

• IFRS annual improvement project 2012-2014

The IFRS annual improvement project 2012-2014 introduces minor amendments and clarifications to IFRS 5 – Non-current assets held for sale and discontinued operations and IFRS 7 – Financial instruments: Information to be disclosed, IAS 19 – Employee benefits and IAS 34 – Interim financial reporting.

This amendment will apply to years starting on 01 January 2016 or later, although early adoption is permitted.

b) Accounting principles and valuation rules

In preparing the consolidated financial statements, the generally accepted accounting principles and valuation rules referred to in Note 5 as "Accounting principles and valuation rules applied" have been followed.

Unless otherwise indicated, these consolidated financial statements are presented in thousands of euros.

c) Judgements and estimates made

The information contained in these consolidated financial statements is the responsibility of the Bank's Directors. In valuing certain assets, liabilities, revenues, expenses and commitments, use has been made as necessary of estimates made by the Group's Senior Management and ratified by its Directors. These estimates relate mainly to:

• impairment losses on certain assets (Note 10)
• the useful life attributed to tangible and non-tangible assets (Notes 14 and 15)

• the fair value of certain unlisted assets (Note 44)

• the actuarial assumptions used to calculate liabilities and commitments for post-employment benefits (Note 28)

• the calculation of provisions (Note 21)

Although these estimates have been made based on the best information available as at 31 December 2014 on the items concerned, it is possible that future events might require them to be revised in coming financial years. Any such revision would be carried out prospectively, in accordance with the provisions of IFRS 8, recognising the effects of the change in the corresponding profit and loss account in the financial years affected.

d) Principles of consolidation

The Group has been defined in accordance with current applicable accounting regulations. Group Companies comprise Subsidiaries, Joint Arrangements and Associates.

Subsidiaries are entities forming a single decision-making unit with the parent company, in other words entities over which the parent company has the power to exert control directly or indirectly through other Group Companies. This power to exert control is generally, although not invariably, reflected in the parent company's holding, directly or indirectly through one or more other Group Companies, 50% or more of the voting rights in the Group Company. Control means the power to govern the financial and operating policies of a Group Company with a view to obtaining benefits from its activities, and may be exerted even if the abovementioned percentage of voting rights is not held.

The relevant information on investments in subsidiaries as at 31 December 2014 and 2013 is included in Note 13. In 2014 there was no company considered to be a subsidiary in which the Group's holding was less than 50%.

The overall integration procedure for the annual accounts of dependent entities has been applied to the consolidation process. Consequently, all significant intercompany balances and transactions have been eliminated in the consolidation process. Third party or minority interests in the Group's equity are presented under the heading Non-controlling interests in the consolidated balance sheet and the portion of the year's profit attributable to them is shown under Profit (loss) attributable to non-controlling interests in the consolidated income statement.

Results generated by entities acquired by the Group during the financial year are consolidated only insofar as they relate to the period between the date of acquisition and year-end. Similarly, results generated by entities disposed of by the Group during the financial year are consolidated only insofar as they relate to the period between the beginning of the financial year and the date of the disposal.

Joint Ventures are group companies which, while not being subsidiaries, are jointly controlled by the Group and by one or more other entities not related to the Group and joint operations. Joint Operations are contractual agreements by virtue of which two or more entities or participants perform transactions or maintain assets in such a way that any financial or operational strategic decision which affects them requires the unanimous consent of all participants, without these transactions or assets being integrated in financial structures different from those of the two participants.

Joint ventures are accounted for using the equity method. Relevant information on investments in Joint Arrangements as at 31 December 2014 and 2013 is presented in Note 13.

Associates are those over which the Group has a significant influence. Said significant influence is generally, although not invariably, reflected in the parent company's holding, directly or indirectly through one or more other Group Companies, 20% or more of the voting rights in the Group Company.

The equity method for associated entities has been applied to the consolidation process. Consequently, investments in Associates are valued at the proportion represented by the Group's holding in their capital, less dividends received and any other eliminations in equity. Transactions with Associates are eliminated in the proportion represented by the Group's holding. If an Associate's equity is negative as a result of losses incurred, it is shown as zero in the Group's consolidated balance sheet unless the Group is under an obligation to support it financially.

The relevant information on stockholdings in associates as at 31 December 2014 and 2013 is included in Note 13. In 2014 and 2013 there was no investment in any company considered to be an Associate in which the Group's holding was less than 20%.

Note 13 includes information on the most significant acquisitions and disposals during the year of investments in Subsidiaries, Joint Arrangements and Associates.

Business combinations are operations whereby two or more entities or economic units combine to become a single entity or group of companies.

e) Comparison of information

In accordance with business law, the Directors present the information contained in this report referring to 2013 exclusively for purposes of comparison with the 2014 figures, and therefore it does not constitute the Group's consolidated financial statements for 2013. In this regard the changes in accounting principles described in Note 2 should be borne in mind.

f) Equity

Applicable laws and regulations

On 1 January 2014 Regulation (EU) 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms (the Capital Requirements Regulation or CRR) came into force, together with European 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 their prudential supervision. The two instruments together constitute the transposition into European law of the new solvency rules known as BIS III, and regulate the levels of solvency and the composition of the computable resources with which credit institutions must operate.

The new rules impose much more demanding capital requirements on institutions, and to avoid this strengthening of solvency unduly affecting the real economy, certain aspects of it will be phased in gradually between now and 2019. This transitional implementation phase mainly affects the definition of resources computable as capital and the establishment of capital buffers over and above the regulatory minimums.

Banco de España Circulars 2/2014 of 31 January and 3/2014 of 30 July establish the schedule for applying the various aspects of the regulations in Spain. Additionally, certain aspects of the regulations are subject to further developing regulations on the part of the EBA (European Banking Authority), the main purpose of which is to establish uniform principles of implementation throughout the European Union. Over the course of 2014, the EBA published a large number of technical standards, guides and recommendations developing numerous aspects, but many still remain in the process of consultation or study, and will be tackled, approved and published during the next few years.

Management of equity

The principle laid down by Bankinter's Board of Directors in relation to the management of its equity consists in operating with a level of solvency in excess of that established by applicable laws and regulations, appropriate to the risks inherent in its business and in the environment in which it operates. The objective is the continuous strengthening of solvency, as a basis for sustained growth and long-term value creation for shareholders.

In order to meet this goal, the Group has a series of policies and processes for managing equity, the main guidelines in which are:

• The Board of Directors and Senior Management are actively involved in the strategies and policies concerning the management of the Group's capital. The objective is to maintain robust solvency ratios of appropriate quality, consistent with the Bank's risk profile and its business model.

• The Equity and Basel Directorate, which is under the Capital Market Division, performs monitoring and control of solvency ratios, and has warning systems that ensure that the applicable rules are being applied at all times and that the decisions made by the various departments and units in the entity are consistent with the targets set for compliance with minimum capital requirements. Accordingly, there are contingency plans to ensure that the limits laid down in the applicable regulations are met. There are independent units entrusted with the validation, control and auditing of these processes.

• The Group uses internal ratings based (IRB) methods to calculate capital requirements for the credit risk on certain credit exposures, which have been validated and approved by the Supervisor. For all other exposures the standard methods described in the regulations are applied. In the next few years new portfolios will be incorporated into the IRB Approach in accordance with a progressive implementation plan agreed with the Supervisor.
• The impact that decisions will have on the Group's equity and on the balance between capital consumption, risk and return, is taken into account as a key factor in planning, analysing and monitoring the Group's operations.
• Capital planning is carried out annually and periodically monitored by the Management Bodies in order to detect any deviations and take any corrective measures that may be appropriate. Within this planning process, stress tests are carried out enabling the Bank's resistance in particularly adverse economic scenarios to be monitored.

The Bank considers its computable equity and the capital requirements established by law to be key factors in its management, affecting investment decisions, the analysis of the viability of transactions, the strategy for distributing profits and issues by the parent company, the subsidiaries and the Group, etc.

Evolution of equity during the year

The minimum level of solvency required by the new regulations is calculated by dividing computable capital by risk-weighted assets.

The definition of computable capital in the new regulations is stricter than before, basically because it introduces new deductions from capital, and because certain instruments are no longer considered as capital since they do not meet the new criteria of loss absorption.

First-class quality capital is called CET1 (Common Equity Tier 1) and basically comprises capital and reserves, minus a number of items such as treasury stock, intangible assets and certain significant investments.

After CET1 comes AT1 (Additional Tier 1) which basically consists of certain instruments with a high loss absorption component in that they would outrank only shareholders in the event of liquidation.

Last comes T2 (Tier 2) which basically consists of instruments that absorb losses only after shareholders and AT1 instruments, being subordinated to common creditors.

Further details of the characteristics of these instruments with regard to their the ability to absorb losses, availability, permanence and ranking of claims in the event of liquidation can be found in the "Information of Prudential Relevance" document, which is published on the Bank's corporate website. This report also shows a reconciliation of accounting equity with computable capital.

Risk-weighted assets are determined by reference to the entity's exposure to credit and counterparty risk, the risk of the trading portfolio and operational risk.

The Regulation also establishes limits on risk concentration and certain mandatory aspects with regard to corporate governance. It also includes two new ratios relating to liquidity and a leverage ratio. The Liquidity Coverage Ratio (LCR) aims to measure the short-term liquidity of the entity and will be implemented in 2015, while the Net Stable Funding Ratio (NSFR), which measures the entity's level of stable funding in the medium term, is still being calibrated. The leverage ratio seeks to limit excessive gearing and to ensure that institutions maintain assets in proportion to their level of capital, so as to try to avoid traumatic deleveraging in times of recession. This ratio

is also in the process of being calibrated, although entities are obliged to publish it starting in 2015.

Consolidated equity as at 31 December 2014 and 2013 and the corresponding capital ratios are shown in the following table:

	31-12-2014	31-12-2013	€000s	%
Capital	269,660	268,675	985	0.37%
Reserves	3,137,032	3,031,696	105,335	3.47%
CET1 deductions	-120,214	-302,730	182,515	-60.29%
Preferred shares	46,669	61,284	-14,615	-23.85%
AT1 deductions	-282,947	-194,431	-88,515	45.53%
CET 1	3,050,199	2,864,494	185,705	6.48%
CET 1 (%)	11.87%	12.04%	-0.17%	-1.41%
TIER 1	3,050,199	2,864,494	185,705	6.48%
Tier 1 (%)	11.87%	12.04%	-0.17%	-1.41%
Tier II instruments	421,747	455,693	-33,946	-7.45%
Tier II deductions	-112,427	-152,096	39,670	-26.08%
Tier 2	309,320	303,597	5,723	1.89%
Tier 2 (%)	1.20%	1.28%	-0.07%	-5.67%
Total computable equity	3,359,519	3,168,091	191,428	6.04%
Solvency ratio	13.07%	13.31%	-0.24%	-1.82%
Total risk-weighted assets	25,703,876	23,798,935	1,904,941	8.00%
of which credit risk	22,156,903	20,689,395	1,467,507	7.09%
of which market risk	381,580	279,885	101,694	36.33%
of which operational risk	1,773,375	1,583,250	190,125	12.01%

For purposes of comparison, capital and capital requirements for 2013 have been recalculated to bring them into line with the regulations in force since 1 January 2014. The ratios as at December 2013, with the rules in force at that time (Banco de España Circular 3/2008 on the determination and control of minimum capital) were:

• Tier 1 ratio (%): 12.91%
• Tier 2 ratio (%): 1.23%
• Solvency ratio (%): 14.13%

In December 2014 the top-quality (CET1) ratio was 11.87%, well in excess of the regulatory minimum required by the regulations in force. The overall solvency level was 13.07%. During the year the ratio fell by 17 basis points, basically because of the impact on the Group's consolidated reserves of the adoption of IFRIC 21 on levies, and the increase in business in 2014. We now go on to explain in more detail the main changes in each of the levels of capital.

The changes in (CET1) in 2014 were basically due to retaining part of the earnings for the year, applying to reserves the adjustment in respect of the DGF as a result of adopting IFRIC 21, and the change in accounting treatment of the goodwill deduction, which pursuant to Banco de España Circular 3/2014 has only partly to be deducted from CET1 since July 2014.

Changes in AT1 during the year came from the gradual elimination (20% in 2014) of the €58.34 million issue of preferred shares, which are no longer eligible as AT1 under the new regulations. The deductions increased basically because of the incorporation of part of the goodwill deduction which is no longer deducted from CET1.

Tier 2 capital (T2) reduced as a result of the fact that certain subordinated debt issues started to be no longer considered as capital, either because they were nearing their maturity or because they did not meet the stricter eligibility criteria contained in the current regulations.

As regards risk-weighted assets, there was an increase as a result of the Bank's increase level of business which affected credit risk, market risk and operational risk.

g) Minimum reserve ratio

Monetary Circular 1/1998 of 29 September, effective 1 January 1999, abolished the cash coefficient which had been in place for ten years and replaced it with the minimum reserve ratio.

As at 31 December 2014 and 2013 and throughout the years then ended, the consolidated entities complied with the minimums for this ratio required by applicable Spanish regulations.

The amount of cash which the Group held immobilised on account at Banco de España for this purpose stood at €217.54 million and €767.02 million as at 31 December 2014 and 2013 respectively, although the obligation of the various Group companies subject to this coefficient to maintain the balance required by applicable regulations in order to comply with the aforementioned minimum reserves coefficient is calculated on the average of closing balances for the day held by each of them in this account during the period for which it is maintained.

h) Information on deferrals in payments to suppliers. Third additional provision. "Duty of information" in Law 15/2010 of 5 July

The following information is provided in order to comply with the provisions of Law 15/2010 of 5 July amending Law 3/2004 of 29 December, establishing measures to combat payment delinquency in commercial transactions, as implemented by the Resolution of 29 December 2010 of the Spanish Accounting and Audit Institute on disclosures to be included in the notes to the financial statements with regard to delayed payments to suppliers in commercial transactions:

	Amounts	paid and pending	payment as	at year end
		2014 2013
	Amount	%	Amount	%
Paid within the maximum legal timeframe	724,836	100%	692,140	100%
Other	-	-	-	-
Total payments for the year	724,836	100%	692,140	100%
Weighted average days past due	-	-	-	-
Deferrals which exceed the legal maximum term as at year end	-	-	-	-

The legal timeframe has been defined in accordance with that which corresponds depending on the nature of the good or service received by the company under the terms of Act 3/2004, of 29 December, defining measures to combat default in trade operations.

3. Distribution of earnings for the year.

The proposal to distribute the profits of Bankinter, S.A. for the year ending 31 December 2014, made by the bank's administrators and subject to the approval of the General Shareholders Meeting is as follows:

Appropriation:
Voluntary reserves	255,885
Legal Reserve	-
Dividends	137,944
Profit appropriated	393,829
Profit (loss) for the year	393,829

Details of interim dividends distributed and the corresponding liquidity statements are given in Note 22.

The proposed appropriation of profit for the year ended 31 December 2014 of the subsidiaries of Bankinter, S.A. drawn up by their respective Directors and pending approval by the respective General Shareholders Meetings is as follows:

The appropriation of profits for the year ended 31 December 2013 of the subsidiaries
of Bankinter, S.A., approved by their respective General Shareholders Meetings, was
as follows:

	€000s
	Result	Dividend	Reserves	Applications
Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A.	428	-	428	-
Bankinter Gestión de Activos, S.A., S.G.I.I.C.	26,281	26,281	-	-
Hispamarket, S.A.	673	-	673	-
Intermobiliaria, S.A.	(75,013)	-	(75,013)	-
Bankinter Consumer Finance, E.F.C., S.A.	25,891	12,945	12,946	-
Bankinter Capital Riesgo, S.G.F.C.R, S.A.	197	-	197	-
Bankinter Sociedad de Financiación, S.A.	77	-	77	-
Bankinter Emisiones, S.A.	5	-	5	-
Bankinter Capital Riesgo I, Fondo Capital	630	-	630	-
Grupo Línea Directa Aseguradora	93,983	60,552	33,431	-
Arroyo Business Development, S.L.	(1)	-	(1)	-
Relanza Gestión, S.A.	33	-	33	-
Gneis Global Services S.A.	7,835	3,917	3,918	-
Mercavalor, S.V., S.A.	2,949	-	2,949	-
Bankinter Luxembourg, S.A.	(2,275)	-	(2,275)	-
Naviera Goya, S.L.	2	-	2	-
Naviera Sorolla, S.L.	2	-	2	-

	€000s
	Result	Dividend	Reserves	Applications
Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A.	117	-	117	-
Bankinter Gestión de Activos, S.A., S.G.I.I.C.	16,783	16,783	-	-
Hispamarket, S.A.	(2,164)	-	(2,164)	-
Intermobiliaria, S.A.	(105,881)	-	(105,881)	-
Bankinter Consumer Finance, E.F.C., S.A.	23,706	11,853	11,853	-
Bankinter Capital Riesgo, S.G.F.C.R, S.A.	186	-	186	-
Bankinter Sociedad de Financiación, S.A.	716	-	716	-
Bankinter Emisiones, S.A.	-	-	-	-
Bankinter Capital Riesgo I, Fondo Capital	1,312	-	1,312	-
Grupo Línea Directa Aseguradora	90,952	60,000	30,952	-
Arroyo Business Development, S.L.	(2)	-	(2)	-
Relanza Gestión, S.A.	30	-	30	-
Gneis Global Services S.A.	13,282	7,000	6,282	-
Mercavalor, S.V., S.A.	(264)	-	(264)	-
Bankinter Luxembourg, S.A.	(1,081)	-	(1,081)	-
Naviera Goya, S.L.	(2)	-	(2)	-
Naviera Sorolla, S.L.	(2)	-	(2)	-

4. Deposit Guarantee Fund

Royal Decree Law 16/2011 of 14 October created the Deposit Guarantee Fund for credit institutions (hereinafter "DGF"), following the merging of the three previously existing deposit guarantee funds into a single Deposit Guarantee Fund for credit institutions, which retains the functions and characteristic features of the three funds it replaced. This Royal Decree-Law revised the legal limit on annual contributions, establishing a limit on contributions of 0.3% of deposits guaranteed and a real contribution of 0.2% of deposits guaranteed. The Bank is a member of the DGF.

The fifth additional provision of Royal Decree Law 21/2012 of 13 July, introduced by Article 2 of Royal Decree Law 6/2013 of 22 March, established an exceptional contribution of 0.3% on deposits of member institutions as at 31 December 2012, requiring the first tranche, equivalent to two fifths of the amount, to be paid in the first twenty business days of 2014, after any deductions granted in the terms of this decree law, while the second tranche, equivalent to the remaining three fifths, would be paid starting on 1 January 2014 in accordance with the calendar of payments to be established by the Managing Committee of the DGF within a maximum term of seven years. The member entities paid the first tranche of the contribution on 22 January 2014, and on 30 September 2014 they paid a first payment of the second tranche equivalent to one seventh of said tranche. On 17 December 2014 the Managing Committee of the DGF resolved that payment of the remainder of this second tranche of the contribution should be made in two equal amounts, one on 30 June 2015 and the other on 30 June 2016.

The cost for 2014 and 2013 of the Bank's contributions to the Deposit Guarantee Fund was €44.91 million and €75.63 million respectively. These costs are included under the heading 'Other operating charges' in the Income Statement (Note 34). During 2014 payments of the extraordinary contribution to the DGF amounted to €7.02 million.

5. Accounting principles and valuation rules applied

These consolidated financial statements have been prepared in accordance with the accounting principles and valuation rules currently in effect. A summary of the most important of these is given below:

a) Going-concern basis

In preparing the consolidated financial statements it was assumed that the management of the entities included in the Group will continue for the foreseeable future. Therefore, application of accounting standards is not aimed at determining the value of the consolidated equity with a view to their total or partial disposal or the amount that would result in the event of their liquidation.

b) Accrual principle

These consolidated financial statements, with the exception of the Statements of cash flows, have been prepared based on the real flow of goods and services regardless of the payment or receipt dates, with the exception of the interest relating to loans and receivables and other non-investment risks with borrowers deemed to be impaired, which are credited to profit and loss at the time they are collected.

The accrual of interest on both lending and deposit transactions with settlement periods in excess of 12 months, are calculated using the financial method. For transactions with a lesser period, accrual is performed using either the financial method or the linear method.

Following general financial practice, transactions are recognised on the date they occur, which may differ from their corresponding value date on which financial revenue and expense calculations are based.

c) Transactions and balances in foreign currency

i. Functional Currency:

The Group's functional currency is the euro. Consequently all balances and transactions denominated in a currency other than the euro are considered to be denominated in "foreign currency".

ii. Criteria for conversion of foreign currency balances:

Balances and transactions in foreign currency have been converted into euros using the following conversion rules:

• Monetary assets and liabilities have been converted into euros using the average spot exchange rates in the currency market at year end.
• Non-monetary items valued at historical cost have been converted into euros using the exchange rates of the date of acquisition.
• Non-monetary entries valued at fair value have been converted into euros using the exchange rates of the date on which the fair value was determined.
• Revenue and expenses have been converted into euros using exchange rates of the date of the transaction (using the average exchange rates for the year for all transactions performed in that year). Depreciation and amortisation have been converted into euros at the exchange rate applied to the corresponding asset.

Exchange rate differences have been recognised in consolidated profit and loss except for differences arising in non-monetary items at fair value, for which fair value adjustments are recognised directly in equity.

d) Consolidated statements of cash flows

The Group used the indirect method to prepare the cash flow statements, which use the following expressions and classification criteria:

• Cash flows:inflows and outflows of cash and cash equivalents; cash equivalents are understood as short-term investments with high liquidity and a low risk of alterations to their value. Cash and cash equivalents refer to the balances shown under the heading "Cash and deposits at central banks" as well as other accounts with highly liquid credit institutions in the enclosed balance sheets.

• Operating activities: typical activities of credit institutions, and other activities that cannot be classified as investing or financing.

• Investing activities: acquisition, disposal or provision by other means of longterm assets and other investments not included in cash and cash equivalents.
• Financing activities: activities that produce changes in the size and composition of liabilities and equity and which do not form part of operating activities.

e) Consolidated statement of comprehensive income

This section of the consolidated statement of changes in equity shows the revenue and expenses generated by the Group as a consequence of its activity during the year. A distinction is made between items recognised in consolidated profit and loss for the year and other comprehensive income as provided by current regulations recognised directly in equity.

Therefore, this statement shows:

• a. Consolidated income for the year.
• b. The net amount of revenue and expenses temporarily recognised in consolidated equity as valuation adjustments.
• c. The net amount of revenue and expenses definitively recognised in consolidated equity.
• d. Corporation tax accrued on b) and c) above except for valuation adjustments on investments in associates or joint arrangements accounted for using the equity method, which are reported in net terms.
• e. Total consolidated comprehensive income calculated as the sum of the above sections, showing separately the amount attributable to owners of the parent company and that attributable to non-controlling interests.

The amount of revenue and expenses corresponding to entities accounted for using the equity method recognised directly in equity is reported in this statement, regardless of its nature, under the heading "Entities accounted for using the equity method".

Changes in comprehensive income recognised in equity as valuation gains/ (losses) are broken down into:

• - Gains (losses)on valuation: This shows the amount of income, net of expenses arising in the period, recognised directly in equity. The amounts recognised during the year under this heading are kept under this heading, even if in the same year they are transferred to consolidated profit and loss at the initial value of other assets or liabilities or reclassified under another heading.
• - Amounts transferred to profit and loss: This covers the amount of gains or losses on valuation previously recognised in consolidated equity, even if in the same financial year, which are now recognised in the consolidated Income Statement.
• - Amounts transferred to the initial carrying amount of the hedged items: This records the amount of valuation gains or losses previously recognised in consolidated equity, even if in the same financial year, which are now recognised in the initial value of the assets or liabilities as a result of cash flow hedges.
• - Other reclassifications: This records the value of the transfers made in the period between entries for valuation adjustments in accordance with the criteria provided in current regulations.

The amounts of these items are reported by gross amount and, except as indicated above for items corresponding to valuation adjustments for the valuation of entities accounted for using the equity method, they show their corresponding tax effect under the heading "Corporate tax" of the statement.

f) Consolidated statement of changes in total equity.

This part of the consolidated statement of changes in equity shows all changes in equity that have occurred during the year, including those arising from changes in accounting principles and the correction of errors. This statement therefore shows a reconciliation between the carrying amount at the start and end of the year of all components of consolidated equity, grouping together the movements based on their nature under the following headings:

• Adjustments arising from changes in accounting principles and the correction of errors: This includes changes to consolidated equity arising as a result of the retroactive restatement of balances in the financial statements due to changes in accounting standards or the correction of errors.
• Income and expenses recognised in the period: this comprises, in aggregate form, the total of the items recognised in the statement of comprehensive income referred to above.
• - Other changes in equity: This comprises all other items recognised in equity, such as increases or decreases in the endowment fund, appropriation of profits, transactions with own equity instruments, payments with equity instruments, transfers between equity headings and any other increases or decreases in consolidated equity.

g) Recognition, valuation, and classification of financial instruments

Financial assets and liabilities are recognised when the group converts a portion of the contractual agreements in accordance with the provisions of these agreements.

Financial liabilities

Financial liabilities are classified in the consolidated balance sheet according to the following criteria:

• i. Trading portfolio which includes financial liabilities issued with a view to short-term realisation. They are part of a portfolio of financial instruments jointly identified and managed for which recent actions have been taken to obtain short-term gains, or they are derivative instruments not designated as hedging instruments or they come from the firm sale of financial assets acquired temporarily or received on loan.
• ii. Other financial instruments at fair value through profit or loss: This includes financial liabilities designated as "at fair value through profit or loss" with the purpose of obtaining more relevant information, as this significantly reduces accounting imbalances.
• iii. Financial liabilities at amortised cost which cannot be included under any other heading in the balance sheet and which are part of the normal funding activities of financial institutions, regardless of the type of instrument used or their maturity dates.
• iv. Hedging derivatives including financial derivatives acquired or issued by the Bank which qualify to be considered accounting hedges.

Financial liabilities are recognised at their amortised cost, as defined for financial assets, except in the following cases:

• i. i. Financial liabilities under the headings 'Trading portfolio' and "Other financial liabilities at fair value through profit or loss" are carried at fair value as defined for financial assets. Financial liabilities hedged in fair-value hedging operations are adjusted and any changes in their fair value relating to the risk hedged in the hedging transaction are recognised.
• ii. Financial derivatives that have as their underlying equity instruments whose fair value cannot be determined in a sufficiently objective manner and which are settled on delivery, are valued at cost.

Changes in the carrying amount of financial liabilities are recognised, in general, with a balancing entry in profit and loss, with a distinction between those originating in the accrual of interest and similar items, which are recognised under the heading 'Interest and similar charges', and those due to other causes, which are recognised for their net amount in 'Results of financial transactions' in the income statement.

Regarding financial liabilities designated as hedged items and accounting hedges, differences in valuation are recognised on the basis of the criteria indicated for financial assets.

Financial assets

Financial assets bought and sold by means of contractual agreements, meaning those in which the reciprocal obligations of the parties must be performed within a particular timeframe established by law or by market conventions and may not be settled by netting off, such as stock market and spot currency trades, are recognised upon acquisition as assets and are derecognised in the balance sheet upon sale, on the date from which the benefits, risks, rights and duties inherent in ownership pass to the acquiring party which, depending on the type of asset or market involved, may be the contracting date or the settlement or delivery date.

Financial debt instruments are recognised from the date on which the legal right to receive or duty to pay cash arises, and derivatives are recognised from the date on which they are contracted. As a general rule, the Group derecognises financial instruments in the balance sheet on the date from which the benefits, risks, rights and responsibilities inherent in them are or control of them is transferred to the acquiring party.

Financial assets are classified in the consolidated balance sheet in accordance with the following criteria:

i. Cash and balances at central banks, corresponding to the cash balances and balances deposited at Banco de España and other central banks.

• ii. Financial assets and liabilities held for trading, which includes financial assets acquired with a view to short-term realisation. They are part of a portfolio of financial instruments jointly identified and managed for which recent actions have been taken to obtain short-term gains, or they are derivative instruments not designated as hedging instruments. Changes in the fair value of the instruments in this portfolio are recognised directly in profit or loss.
• iii. Other financial assets at fair value through profit or loss, including (1) financial assets which, while not part of the financial assets and liabilities held for trading, are considered hybrid financial assets and are stated entirely at their fair value, and (2) those managed jointly with liabilities by insurance contracts carried at their fair value, or with financial derivatives that have the aim of significantly reducing their exposure to variations in their fair value, or which are managed jointly with financial liabilities and derivatives in order significantly to reduce overall exposure to interest-rate risk.
• iv. Available-for-sale financial assets which are debt securities not classified as held-to-maturity investments, as other financial assets at fair value through profit or loss, as loan and receivables or as financial assets and liabilities held for trading, and the equity instruments of entities which are not subsidiaries, associates or joint ventures and which are not included in the categories of financial assets and liabilities held for trading or other assets at fair value through profit or loss. Changes in the fair value of instruments in this portfolio are recognised directly in equity worth until the financial asset is derecognised from the balance sheet.
• v. Loan and advances including financial assets not traded on an active market and not requiring to be carried at fair value but with cash flows of determined or determinable amounts whereby the Group's entire disbursement will be recovered, barring reasons attributable to the debtor's solvency. This includes both the investments from typical lending activity, such as the cash amounts drawn down and pending repayment by clients in the form of loans, and deposits lent to other entities, regardless of how they are legally implemented, and unlisted debt securities, as well as debt assumed by the buyers of goods or the users of services, all of which are part of the Group's business.

vi. Investment portfolio held to maturity which corresponds to fixed-term debt securities and cash flows of a determined or determinable amount for which the company has, as from the start and as at any subsequent date, both the positive intention and the financial capacity to hold them to maturity.

The Bank may not classify any financial asset as a held-to-maturity investment if during the financial year in progress or the two previous financial years it has sold or reclassified assets included in this portfolio for more than an insignificant amount in relation to the total amount of the assets included in this category.

• vii.Adjustments to financial assets in relation to macro-hedges, being the balancing entry for the amounts credited to profit and loss arising from the valuation of the portfolio of financial instruments which are effectively hedged against interest-rate risk by means of fair-value hedge derivatives.
• vii.Hedging derivatives including the financial derivatives acquired or issued by the Bank which qualify to be considered as accounting hedges.
• ix. Investments which include equity instruments in Joint Ventures or Associates.

In general, financial assets are initially recognised at cost. Their subsequent valuation at the end of each period is carried out on the basis of the following criteria:

i. Financial assets are carried at fair value, with the exception of loan and receivables, the portfolio of held-to-maturity investments, equity instruments whose fair value cannot be determined with sufficient objectiveness, investments in Subsidiaries, Joint Arrangements and Associates, and financial derivatives for which the underlying assets are said equity instruments and which are settled by delivery thereof.

ii. The fair value of a financial asset on any given date is deemed to be the amount for which it could be delivered between duly informed, willing parties in an arm's length transaction. The best evidence of fair value is the listed market price on an active market which is organised, transparent and of sufficient depth.

When there is no market price for a certain financial asset, its fair value may be estimated by valuation techniques which must comply with the following characteristics:

• The techniques must be as consistent and appropriate as possible and will include observable market data such as recent transactions with other instruments that are substantially the same; discounted cash flows and market models to value options.
• The techniques used must be those which provide the most realistic estimate of the price of the instrument, and preferably they will be those which are normally used by market participants when valuing the instrument.
• The techniques will maximise the use of observable market data, with the use of non-observable data being restricted as far as possible. The valuation method must be maintained over time as long as the factors that led to its being chosen have not altered. In any event, the valuation technique must be assessed periodically and its validity examined using observable prices for recent transactions and current market data.
• In addition, consideration must also be given to factors such as the time value of money, credit risk, exchange rates, prices of equity instruments, volatility, liquidity, the risk of early cancellation and administrative costs.

Certain equity instruments are measured at cost because their fair value cannot be reliably estimated. The inability to make a reliable estimate of fair value is due to the wide range of estimates and the impossibility of reasonably assessing the probabilities of each estimate in the range.

iii. The fair value of financial derivatives with a quoted value on an active market is the daily trading price. If for any exceptional reason there is no trading price for a particular date, then methods similar to those used to estimate the value of OTC financial derivates are used.

The fair value of OTC financial derivatives is the sum of future cash flows originating from the instrument and discounted to the valuation date using methods recognised by the financial markets.

iv. Loans and receivables and the portfolio of investments held to maturity are carried at amortised cost determined using the effective interest-rate method. Amortised cost means the acquisition cost of a financial asset corrected by the principal repayments and the portion of the difference between the initial cost and the repayment value at maturity that is charged to profit and loss, using the effective interest rate model, less any reduction in value due to impairment recognised directly as a decrease in the value of the asset or by means of an account to correct its value. If they are hedged by fair-value hedging transactions, any variations arising in the fair value relating to the risk or risks hedged in said hedging transaction are recognised.

The effective interest rate is the rate which, when used to discount the estimated future cash flows over the life of the financial instrument, produces a present value exactly equal to the price of the financial instrument, based on the contractual conditions such as early repayment options, but without taking account of future losses due to credit risk. For fixed-interest financial instruments, the effective interest rate is the contractual interest rate established at the time of acquisition plus any applicable fees or commissions which, by their nature, are equivalent to an interest rate. For variable-interest financial instruments, the effective interest rate coincides with the yield rate in force for all items up to the first scheduled revision of the reference interest rate.

v. Investments held in the capital of other entities for which the fair value cannot be determined in a sufficiently objective manner and financial derivatives for which these instruments are the underlying assets and which are settled by delivering the assets are carried at cost, corrected where applicable by the losses due to impairment which they have experienced.

Changes in the carrying amount of financial assets are recognised, in general, with a balancing entry in profit and loss, with a distinction between those originating in the accrual of interest and similar items, which are recognised under the heading 'Interest and similar income', and those due to other causes, which are recognised for their net amount in 'Results of financial transactions' in the income statement.

However, variations in the carrying amount of the instruments included under the heading ' Available-for-sale financial assets' are temporarily recognised under the heading 'Equity valuation adjustments' except when they are due to exchange-rate differences. The amounts included under the heading 'Valuation adjustments' continue to be part of equity until the assets to which they relate are removed from the balance sheet, at which time the entry is cancelled against profit and loss.

For financial assets designated as hedged items or accounting hedges of fair value, the valuation differences in both the hedging and the hedged items, as far as the type of risk hedged is concerned, are recognised directly in profit and loss.

In hedges of the fair value of the interest-rate risk of a portfolio of financial instruments, gains or losses arising on valuing the hedging instrument are recognised directly in profit and loss, while gains or losses due to changes in the fair value of the hedged amount, with regard to the hedged risk, are recognised in profit and loss with a balancing entry under the heading 'Adjustments to financial assets due to macro-hedges'.

Overdue and impaired financial assets

The "overdue" or "doubtful" positions are defined as those debt instruments, regardless of the debtor's identity or the security held, where there is any amount of principal, interest or contractually agreed expenses more than 90 days overdue, except if they are classified as bad debt; and contingent risks where the customer on whose behalf the guarantee has been issued is in arrears. Also included in this category are amounts of all a customer's transactions when the balances classified as "overdue" exceed 20% of total outstandings.

Debt instruments classed as doubtful for which specific value corrections have been made, estimated individually or collectively, are reported as "impaired assets", and the remaining debt instruments as unimpaired assets, even if they form part of groups of assets for which collective value corrections have been made for losses incurred but not reported.

h) Recognition of income and expenses

Income and expenses from interest and related items are recognised generally according to the period of accrual and by application of the effective interest-rate method. Dividends received from other entities are recognised as income at the moment the right to receive them arises.

Fees paid or received for financial services, regardless of how they are described in contractual terms, are classified in the following categories, thereby determining their assignment in the income statement:

i. Financial fees which are an integral part of the return or effective cost of a financial transaction, and which are taken into profit and loss over the expected lifetime of the transaction as an adjustment to the cost or effective return. These include commitment fees and fees for the study of asset products, fees for excess credits, and overdraft fees on liability accounts.

ii Non-financial fees, which are those that derive from the provision of services and that might arise in the execution of a service provided during a period of time and in the provision of a service that is executed in a single act.

Income and expenses are generally recognised in profit and loss, in accordance with the following criteria:

• i. Those relating to financial liabilities at fair value through profit or loss are recognised when received.
• ii. Those relating to transactions or services that are provided over a period of time are recognised during the period of such transactions or services.
• ii. Those relating to a transaction or service executed in a single act are recognised when such act is performed.

Non-financial income and expenses are recognised on an accrual basis. Deferred collections and payments, for terms in excess of one year, are recognised in the amount resulting from discounting the anticipated cash flows to their present value using market rates of interest.

i) Impairment of financial assets

The carrying amount of financial assets is generally corrected as a charge against consolidated profit and loss when there is objective evidence that a loss has occurred owing to impairment, which occurs in the following cases:

• i. In cases of debt instruments, meaning loans and debt securities; when, after their initial recognition, there is an event or combined effect of several events that has a negative impact on future cash flows.
• ii. In the case of equity instruments, when after recognition there is an event or combined effect of several events with the effect that its carrying amount will not be recovered.

As a general principle, the correction of the carrying amount of financial instruments owing to impairment is made against the income statement of the period in which the impairment is manifested; and the recovery of the losses owing to previously recognised losses from impairment, if any, is recognised in the income statement in the period in which the impairment is eliminated or reduced. If the possibility of recovering an amount owing to recognised impairment is considered remote, the impairment is eliminated from the consolidated balance sheet, although the Group may perform the actions necessary to attempt to achieve collection until the final expiration of rights owing to prescription, cancellation or other causes.

In the case of debt instruments valued at their amortised cost, the amount of losses owing to impairment incurred is equal to the negative difference between its carrying amount and the present value of estimated future cash flows. For listed debt instruments, use can be made, as a substitute for the present value of future cash flows, of their market value provided that it is sufficiently reliable to be considered representative of the value the Group may recover.

Estimated future cash flows of a debt instrument are all the sums, both principal and interest, that the Group estimates it will obtain during the lifetime of the instrument. This estimate takes account of all the relevant information available as at the date of preparation of the consolidated financial statements that provides data on the possible future collection of the contractual cash flows. Similarly, when estimating the future cash flows of instruments that have tangible securities, the flows that would be obtained from their realisation are taken into account, minus the costs necessary for their collection and subsequent sale, regardless of the probability of execution of the guarantee.

In calculating the present value of estimated future cash flows the original effective interest rate of the instrument is used as the discount rate if its contractual rate is fixed, or the effective interest rate on the date referred to in the financial statements determined in accordance with the contractual conditions is used if it is variable.

Objective evidence of impairment will be determined individually for all debt instruments that are significant, and individually and collectively for groups of debt instruments that are not individually significant. When a specific instrument cannot be included in any asset group with similar risk characteristics, it will be analysed in an exclusively individual manner to determine whether it is impaired and, if necessary, to estimate the loss from impairment. Accordingly, the impairment is broken down depending on how it is calculated, into:

• 1) Specific value corrections for financial assets, estimated individually: cumulative amount of cover set aside for doubtful assets estimated individually.
• 2) Specific value corrections for financial assets, estimated collectively: cumulative amount of the collective impairment calculated for debt instruments classed as doubtful with insignificant amounts, which have suffered individual impairment and for which the entity uses a statistical approach; more precisely, it calculates the specific coverage by applying collective coverage percentages depending on the ageing of the unpaid items.
• 3) Collective value corrections for losses incurred but not reported: Cumulative amount of the collective impairment of debt instruments that have not suffered individual impairment

Collective evaluation of a group of financial assets in order to estimate the losses from impairment is carried out as follows:

• i. Debt instruments are included in groups that have similar credit-risk characteristics that indicate the capacity of debtors to pay all sums, principal and interest, as per contractual conditions. The characteristics of credit risk used to group assets are, among others, the instrument type, the debtor's activity sector, the geographical area of the activity, the type of guarantee, the aging of the due amounts and any other factor that may be relevant to an estimate of future cash flows.
• ii. Future cash flows in each group of debt instruments are estimated for instruments with credit risk characteristics similar to those of the respective group, after making the adjustments necessary to adapt historical data to present market conditions.

iii. Loss due to impairment of each group is the difference between the carrying amount of all debt instruments and the present value of their estimated future cash flows.

In this regard, Banco de España determines the parameters, methods and amounts to be used to cover losses from inherent impairment losses incurred but not reported on debt instruments and contingent risks classified as normal risk.

Bankinter adheres to the principles established in Banco de España Circular 4/2004 for calculating the impairment of its loan portfolio, and thus complies with the principles laid down by IAS 39 - Financial instruments and IAS 37 - Provisions, contingent liabilities and contingent assets as they relate to financial guarantees and irrevocable lending commitments. Bankinter has carried out an analysis using internal data to ensure that these requirements are appropriate to the reality of the Group, which was confirmed.

The calculation method as provided in Appendix IX to Bank of Spain Circular 4/2004 is divided into two stages.

In the first stage, balances are divided into six types of risk as per the regulation. These types are: No significant risk, low risk, medium-low risk, medium risk, medium-high risk and high risk.

The impaired amount is therefore the sum of the following:

• The result of multiplying the value of the change in the balance of each risk type in the period by the relevant alpha regulatory parameter, plus
• the sum of the results of multiplying the total balance of transactions included in each of the risk types at the end of the period by the relevant beta regulatory parameter, minus
• the net amount of additions to overall specific provisions made during the period.

The overall balance of generic provisions must not exceed 125% of the amount resulting from adding the product obtained by multiplying the amount of each type of risk by its relevant alpha regulatory parameter. In 2012 the Group released the entire generic provision.

The α and β regulatory parameters, for each class of risk, are as follows:

	α	β
No appreciable risk	0%	0 %
Low risk	0.6%	0.11%
Medium-low risk	1.5%	0.44%
Medium risk	1.8%	0.65%
Medium-high risk	2.0%	1.10%
High risk	2.5%	1.64%

Recognition in the income statement of the accrual of interest on the basis of contractual terms is interrupted for all debt instruments individually classified as impaired, and for those for which losses from impairment have been collectively calculated because they have outstanding amounts more than three months old.

When there is objective evidence that the decrease in fair value is due to impairment, the latent losses expressly recognised under the item 'Valuation adjustments' in consolidated equity are recognised immediately in the consolidated income statement. If some or all of the losses from impairment are subsequently recovered, the amount is recognised, in the case of debt securities, in the consolidated income statement for the period when recovered and, in the case of equity instruments, under the heading 'Valuation adjustments' in consolidated equity.

The amount of losses from impairment incurred in debt securities and other equity instruments included under the item 'Available-for-sale financial assets' is equal to the positive difference between their acquisition cost, net of amortisation of the principal, and their fair value minus any loss from impairment previously recognised in the consolidated income statement.

To estimate impairment of equity instruments included in available-for-sale financial assets, the Bank carries out an individual analysis of the impairment of each significant security. However, the Group's accounting policies establish that, in any case, a prolonged or significant decline in fair value below their cost is objective evidence of impairment and an impairment loss must accordingly be recognised for the difference between the cost and the fair value of the instrument concerned. Specifically, in the case of listed equity instruments, the accounting policy considers that a decline is prolonged when the fair value of the instrument has been below its cost for more than 18 months, and significant when it is more than 40% of its cost.

Impairment losses on equity instruments valued at their acquisition cost reflect the difference between their carrying amount and the present value of future expected cash flows, discounted at market rates of returns on other similar securities. These impairment losses are recognised in profit and loss in the period in which they occur, directly decreasing the cost of the financial asset, where the amount cannot be recovered except in case of sale.

In the case of equity instruments constituting holdings in joint ventures and associates, the Group estimates the amount of losses from impairment by comparing its recoverable amount with its carrying amount. Said losses from impairment are recorded in the consolidated profit and loss account of the period in which they occur and subsequent recoveries are recorded in the profit and loss account of the recovery period.

j) Financial derivatives

Financial derivatives are instruments that not only provide a profit or loss but also can allow, under certain conditions, offsetting of all or part of the credit and/or market risks associated with balances and transactions, using as underlying such things as interest rates, certain indices, the prices of certain securities, exchange rates between different currencies and other references of a similar kind. The Group uses financial derivatives traded on organised markets or bilaterally with over-the-counter trading (OTC) both in its own transactions and with retail or wholesale customers.

The Group takes positions in derivatives with the purpose of hedging its positions, performing active management with other financial assets and liabilities or benefiting from the changes in their prices. Financial derivatives that cannot be considered as hedging are considered to be trading derivatives.

Derivatives with an active market are valued according to the listed prices on said markets.

Derivatives without a market, or for which the market has a low level of activity, are valued on the basis of the most consistent and appropriate economic methodologies, maximising the use of observable data and including any factor that a participant in the market would consider, such as a) recent transactions with other instruments that are substantially the same; b) discounted cash flows and c) market models to value options. The techniques applied are those mainly used by market participants and have shown their capacity to provide the most realistic estimate of the price of the instrument.

All financial derivatives are initially recognised at their fair value. For the case of financial swaps, said value is presumed to be zero, except when the entity shows otherwise by means of appropriate valuation techniques. In this case, the initial recognition of fair value generates a gain or a loss that must be recognised in the income statement when all the model variables come exclusively from observable market data, thereby generating so-called 'day one gains'. On the basis of the principle of prudent supervision stipulated for the entity by Banco de España, the Board of Directors decided to apply an alternative criterion of linear accrual of these 'day one gains' during the lifetime of the financial swaps by which they are generated.

A derivative may be designated as a hedging instrument only if it meets the following criteria:

i. It may be considered a hedging instrument in its entirety, even if it is only a hedging instrument for a percentage of its total amount, except in the case of options, in which case the change in its intrinsic value may be deemed to be a hedging instrument, excluding the change in its time value or in forward contracts, which may be so considered for the difference between the cash prices and the forward prices of the underlying asset.

• ii. It is considered a hedge for the whole of its remaining term.
• iii. Where more than one risk is hedged, the different risks hedged may be clearly identified, each part of the instrument may be designated as hedging specific hedged items, and the effectiveness of the different hedges may be demonstrated.

The effectiveness of derivatives hedging defined as hedging is duly documented by way of the effectiveness tests, which are tools that prove that the differences caused by variations in market prices between the hedged items and their hedging are within fair parameters throughout the lifetime of the transactions, thereby meeting the forecasts made at the time of procurement.

If this is not the case at some point, the transactions related to the hedging group would be deemed to be trade transactions and duly reclassified in the balance sheet.

The hedging performed by the Group belongs to the fair value hedging type:

• Micro-hedging or individual hedging (when there is a specific identification between instruments hedged and hedging instruments) hedges against exposure to changes in the fair value of the item hedged. The gain or loss arising from valuing the hedge instruments is recognised immediately in the income statement.
• Portfolio hedging (interest rate risk hedging in a portfolio of financial instruments) hedges exposure to changes in the fair value of the amount hedged in response to changes in the interest rate. The gain or loss arising from valuing the hedge instruments is recognised immediately in the income statement. In the case of the hedged amount, the gain or loss that arises when valuing it is directly recognised in the income statement, using as the balancing entry "Adjustments to financial assets by macro-hedging", or "Adjustments to financial liabilities by macro-hedging", depending on whether the hedged amount corresponds to financial assets or financial liabilities.

k) Transfers and removal of financial instruments from the balance sheet

Transfers of financial instruments are recognised taking into account the manner in which the transfer of risks and profits related to the financial instruments transferred is performed, on the basis of the following criteria:

• i. If risks and profits are substantially transferred to third parties, as in unconditional sales, sales with re-purchase agreements for fair value as at the re-purchase date, sales of financial assets with a call or put option issued out of the money, securities of assets in which the assignor does not withhold subordinated financing or give any type of credit enhancement to the new holders, etc. the financial instrument is removed from the balance sheet, with simultaneous recognition of any debt or obligation held or created as a consequence of the transfer.
• ii. If there is substantial retention of risks and profits associated with the financial instrument transferred, as in the sales of financial assets with a re-purchase agreement, or for the sale price plus interest, securities loan agreements where the borrower is obliged to return the same or similar assets, etc., the financial instrument transferred is not removed from the balance sheet and it is still valued with the same criteria used prior to the transfer. However, the attendant financial liability is acknowledged in books at an amount equal to that of the consideration received, which is subsequently valued at its amortised cost. Income from financial assets transferred but not removed and the costs of the new financial liability are recognised directly in the income statement.
• iii. If there is no transfer or substantial retention of the risks and profits attending the financial instrument transferred, as in the sales of financial assets with an acquired call option or an issued put option which are not in or out of the money, the securities in which the assignor assumes a subordinated financing or another type of credit enhancements for a part of the transferred asset, there is a distinction between:

• Where the Group does not retain control of the financial instrument transferred, in which case it is removed from the Balance Sheet and any right or obligation retained or created as a result of the transfer is recognised.

• Where the Group retains control of the financial instrument transferred, in which case it continues to recognise it in the Balance Sheet for an amount equal to its exposure to the changes in value it may undergo, and a financial liability linked to the financial asset transferred is recognised.

The net amount of the asset transferred and the associated liability will be the amortised cost of the rights and obligations retained, where the asset transferred is measured by its amortised cost, or for the fair value of the rights and obligations retained, where the asset is measured by its fair value.

Therefore, financial assets are derecognised only when the cash flows they generate have ceased or when the risks and benefits they have implicit have substantially been transferred to third parties. Similarly, financial liabilities are derecognised only when the obligations they generate have expired or when they are acquired with the intent of cancelling them or disposing of them again.

When the financial asset transferred is totally removed from the balance sheet, an amount will be recognised in profit and loss equal to the difference between its carrying amount and the sum of: a) the consideration received, including any new asset obtained less any liability assumed, and b) any cumulative result recognised as "valuation adjustments" directly in equity attributable to the financial asset transferred.

l) Property, plant and equipment

Property, plant, and equipment is shown for its acquisition cost, updated in accordance with certain legal rules and appreciated as permitted under the transition to the new accounting standard, minus the relevant accumulated depreciation and any loss from impairment.

Depreciation is calculated systematically according to the linear or sum of the digits method, applying estimated years of service life of the different elements to the acquisition cost of assets minus their residual value. In the case of land on which buildings and other constructions stand, it is deemed that these have an indefinite lifetime, and therefore they are not subject to depreciation. Annual

allocations for the depreciation of tangible assets are charged to the profit and loss account and calculated according to the estimated years of service life, which coincide with the legal minimums.

	Depreciation method
	Depreciation and Amortisation
Buildings	Straight-line over 50 years
Fixtures and fittings and others	Straight line from 6 to 12 years
IT equipment	Sum of the digits

The group reviews, at least at the end of the year, the period and method for depreciation of each tangible asset.

Maintenance expenses and maintenance of tangible assets which do not improve their use or lengthen the service life of the respective assets, are charged to profit and loss at the time they occur.

At each accounting closure, the group analyses whether there are internal and external indications that the net value of aspects of its tangible assets exceeds their corresponding recoverable amount. In this case, the group reduces the carrying amount of the corresponding element to its recoverable amount and adjusts future depreciation charges in proportion to its adjusted carrying amount and for its remaining useful life, in the event that a re-estimate is necessary. In addition, when there are indications that the value of an asset has recovered, the group reverses the impairment loss recognised in prior periods and adjusts future depreciation charges. Reversal of the impairment loss on an asset may in no circumstances entail an increase in its carrying amount above what it would be if impairment losses had not been recognised in previous years.

The heading "Investment property" in the consolidated Balance Sheet comprises the net value of land, buildings and other constructions held either for renting out or with a view to obtaining a possible capital gain on their sale. There are no restrictions on carrying out property investments in the market.

The criteria applied for recognition of the acquisition costs of investment properties, for depreciation, for estimating their respective useful lives and recognising any impairment losses are the same as those outlined above.

m) Intangible assets

Intangible assets are such identifiable, though invisible, non-monetary assets as arise as a consequence of a legal transaction or have been developed internally by the consolidated entities. Only those intangible assets whose cost can be estimated in a reasonably objective way and from which consolidated entities consider it likely that they will obtain future economic benefits are recognised in the accounts.

Intangible assets are recognised initially at their acquisition or production cost and are subsequently valued at cost, less, as appropriate, their corresponding cumulative amortisation and any impairment losses they may have suffered.

Goodwill

Differences between the cost of holdings in the capital of consolidated entities and entities accounted for using the equity method and other forms of business combinations and the corresponding net fair values of the assets and liabilities acquired, adjusted for the percentage holding acquired in these net assets and liabilities in the case of purchase of holdings, as at the date of their acquisition, are accounted for in the following way:

1. If the acquisition price exceeds the aforementioned fair value, as goodwill under "Intangible assets - goodwill" in the consolidated balance sheet. In the case of acquisition of holdings in associates or joint ventures accounted for using the equity method, any goodwill arising on acquisition is recognised as forming part of the value of the holding and not individually under the heading "Intangible assets - goodwill".

2. Negative differences between the acquisition cost and the fair value referred to are recognised once the valuation process has been reviewed, as income in the consolidated income statement under "Negative differences in business combinations".

Positive goodwill (excess of the acquisition price of a holding in a company or business over the net fair value of the assets, liabilities and contingent liabilities acquired) - which are recognised in the consolidated balance sheet only when acquired for valuable consideration - therefore represent prepayments made by the acquiring entity for future economic benefits deriving from the assets of the entity or business acquired which are not individual and separately identifiable and recognisable.

Impairment losses recognised on goodwill shown under "Intangible assets goodwill" are not subsequently reversed.

Other intangible assets

Intangible assets other than goodwill are recognised in the consolidated balance sheet at their acquisition or production cost, net of cumulative amortisation and any impairment they may have suffered.

Intangible assets may have an "indefinite useful life" - when, based on the analyses performed of all relevant factors, it is concluded that there is no foreseeable limit to the period during which net cash flows are expected to be generated in favour of consolidated entities - or a "definite useful life" in the remaining cases.

Intangible assets with an indefinite useful life are not amortised, while for the close of each accounts period, consolidated entities review their remaining respective useful lives in order to ensure that these continue to be indefinite or if not, to take appropriate action.

Intangible assets with a definite life are amortised based on this life, applying criteria similar to those adopted for the depreciation of tangible assets. The annual amortisation of intangible assets with a definite useful life is recognised in "Amortisation" in the consolidated income statement.

Both for intangible assets with indefinite useful lives and those with definite useful lives, the consolidated entities recognise any impairment losses, using as a balancing item "Impairment losses on other assets (net) - goodwill and other intangible assets" in the consolidated income statement. The criteria for recognising impairment losses on these assets and, if applicable, recoveries of impairment losses recognised in preceding years are similar to those applying to tangible assets for own use.

The balances recognised in the intangible asset items in the Balance Sheet, both under goodwill and under other intangible assets, essentially correspond to Línea Directa Aseguradora, S.A. ("LDA")

n) Leases

Leases are presented in accordance with the economic basis of the transaction, independently of their legal form, and are classified from the start as finance or operating leases.

i. A lease is deemed to be a finance lease when essentially all risks and benefits inherent in ownership of the asset that is the subject of the contract are transferred to the lessee.

When the Group acts as lessor, the total annual values of the amounts it will receive from the lessee plus a guaranteed residual value, which is usually the price of the purchase option held by the lessee upon termination of the contract, are recognised as financing granted to a third party, and as such included under the heading 'Loan and receivables' in the balance sheet, in accordance with the nature of the lessee.

On the other hand when the Group acts as lessee, the cost of the assets leased is recognised in the balance sheet according to nature of the asset that is the subject of the contract, and simultaneously as a liability for the same amount, which will be the lower of the fair value of the asset leased or the sum of the present values of the amounts to be paid to the lessor plus, where applicable, the price of the purchase option. These assets are depreciated using similar criteria to those applied to tangible assets for own use.

Lease agreements that are not considered finance leases are classified as operating leases.

When the Group acts as lessor, it recognises the acquisition cost of the assets leased under the heading 'Tangible assets'. Such assets are depreciated in accordance with the policies in effect for similar tangible assets for own use and the income from lease agreements is recognised in profit and loss on a straight line basis.

On the other hand when the Group acts as lessee, leasing costs including any incentives granted by the lessor are recognised on a straight line basis in profit and loss.

o) Non-current assets held for sale

Non-current assets for sale are those with a carrying amount that is to be recovered mainly through their sale, and which are available for immediate sale, and for which their sale is considered to be highly likely.

Non-current assets for sale are shown at the lower of fair value minus selling costs and their carrying amount, and they are not subject to depreciation or amortisation. In the case of repossessed assets, the acquisition cost corresponds to the net value of the financial assets delivered in exchange for taking possession thereof.

Losses from impairment are recognised under the item 'Losses from impairment of non-current assets for sale' in the consolidated income statement. Recoveries of value are recognised in the consolidated income statement up to an amount equal to the losses from impairment recognised previously.

Buildings repossessed in payment of debt are recognised at the lower of fair value minus selling costs and carrying amount. Losses from impairment are recognised under the item 'Losses from impairment of non-current assets for sale' in the consolidated income statement, calculated individually for those remaining for a period longer than that initially foreseen for their sale.

p) Set-off of balances

Balances due and receivable originating from transactions which include the possibility of set-off, either contractually or pursuant to a legal rule, and where the intention exists to settle them at their net value or to realise the asset and pay the liability simultaneously, are presented in the consolidated balance sheet at their net amount.

q) Security loaned or in guarantee

Security lending is a transaction in which the borrower receives full ownership of the securities without paying out more than commissions, with the undertaking to return to the lender securities of the same type as those received.

Contracts for security lending in which the borrower bears the obligation to return the same assets, other assets that are substantially the same, and other similar assets with the same fair value are deemed to be transactions in which the risks and benefits attending ownership of the asset are substantially retained by the lender.

r) Financial guaranties

Financial guarantee contracts are considered as being contracts that require the issuer to make specific payments in order to refund the creditor for the loss incurred when a specific debtor defaults on its payment duties pursuant to the (original or amended) conditions of a debt instrument, irrespective of the legal form thereof, and which may be, amongst others, a surety, financial collateral, a contract of insurance, or a loan derivative.

The Bank recognises financial guarantee contracts under the heading 'Other financial liabilities' for their fair value plus the costs of the transaction that are directly attributable to their issue. At the start, and save where there is evidence to the contrary, the fair value of financial guarantee contracts issued in favour of an unrelated third party, as part of an isolated transaction at arm's length, will be the premium received plus, where appropriate, the present value of the

cash flows receivable, using an interest rate similar to that of financial assets granted by the Bank with a similar term and risk; simultaneously, it recognises the present value of the future cash flows pending receipt as a credit in the assets using the aforementioned interest rate.

Subsequent to the initial recognition, the contracts are treated in accordance with the following criteria:

• a. The value of the fees or premiums receivable for financial guarantees are discounted to present value, with the differences being recognised in profit and loss as financial income.
• b) The value of financial guarantee contracts which have not been classed as doubtful will be the amount initially recognised under liabilities less the part attributed to profit and loss on a linear basis over the expected lifetime of the guarantee or using another criterion, provided that this reflects more appropriately the receipt of the economic benefits and risks of the guarantee.

Financial guarantees are classified in accordance with the default risk attributable to the customer or to the transaction, and where appropriate, consideration is given to the need to establish provisions, applying criteria similar to those indicated in Note (g) for debt instruments valued at amortized cost.

In the event it should be necessary to establish a provision for financial guarantees, any fees pending accrual are reclassified to the corresponding provision.

s) Employee benefits

Post-employment benefits

The Bank has made commitments with its personnel with regard to pensions arising under the Private Sector Banking Collective Labour Agreement.

Commitments in respect of post-employment benefits made by the Bank to its personnel are deemed to be 'Defined contribution plans', where the Bank makes contributions of a pre-determined nature to a separate entity, without any legal or effective duty to make additional contributions should the separate entity be unable to honour the payments due to personnel in relation to the services provided in the current period and previous periods. Post-employment commitments that do not meet the above conditions are deemed to be 'Defined benefit plans'.

Defined contribution plans

The contribution accrued during the financial year for this item is carried under the heading 'Personnel expenses' in the consolidated income statement.

If at 31 December of the financial year there is an outstanding amount pending contribution to the external plan through which the commitments are fulfilled, this is recognised at its present value under the heading 'Provisions - pension fund and similar obligations'. As at 31 December 2014 and 2013, there was no outstanding amount pending contribution to external defined contribution plans.

Defined benefit plans

The Group records the present value of the post-employment fixed-provision benefits under the heading 'Provisions - Pension fund and similar obligations' in the liabilities of the consolidated balance sheet. As explained below, this value is recognised net of the fair value of the assets that meet the requirements in order to be considered as 'Plan assets'.

"Plan assets" are those linked to a particular defined benefit commitment with which these obligations will be settled directly, and which meet the following conditions: They are not owned by the Group, but by a legally separate third party that is not a related party; they are available only for paying or financing post-employment benefits; and they cannot return to the consolidated entities, except where the assets remaining in the plan are sufficient to meet all the obligations of the plan or the entities related to the benefits of the current or former personnel or to refund employee benefits already paid by the Group.

If the Bank can require insurance companies to pay part or all of the payout required to cancel a defined benefit obligation, and it is practically certain that said insurer will reimburse some or all of the payouts required to cancel this obligation, but the insurance policy does not meet the conditions to be a plan asset, the Bank recognises its right to reimbursement on the asset side of the balance sheet under the heading "Insurance contracts linked to pensions", which is otherwise treated as a plan asset.

Post-employment benefits are recognised in the following way:

• The cost of services is recognised in profit and loss and consists of the following components:
• The cost of the services in the current period (understood as the increase in the present value of the obligations arising as a result of the services provided during the financial year by the employees) is recognised under Employee Benefits.
• Past service costs, which arise from changes made to existing postemployment benefits or the introduction of new benefits, and include the cost of curtailments, are recognised under Additions to provisions (net).
• Any gains or losses on settlements are recognised in Additions to provisions (net).
• Net interest on the liability (asset) for defined benefit commitments (understood as change during the year in the net liability (asset) in respect of defined benefits as a result of the passage of time) is recognised under "Interest expense and similar charges" (or Interest and similar income if the net result is positive) in profit and loss.

• The recalculation of the net liability (asset) for defined benefits is recognised under Valuation adjustments, and includes:

• Actuarial gains and losses during the year arising from differences between previous actuarial assumptions and the reality and from changes in the actuarial assumptions used.

• The return on the assets allocated to the scheme, excluding amounts included in net interest on liabilities (assets) in respect of defined benefits.
• Any change in the effects of the limit on assets, excluding amounts that are included in net interest on liabilities (assets) in respect of defined benefits.

Other long-term benefits

Early retirement

The Group guarantees certain commitments made to personnel who have retired early - both with regard to salaries and other social benefits - from the time of early retirement to the date of effective retirement.

Early retirement commitments up to the date of effective retirement are treated for accounting purposes, where applicable, using the same criteria as explained above for defined benefit post-employment benefits, except that all costs for past services and actuarial gains (losses) are recognised as soon as they arise with a balancing entry in the consolidated income statement.

Death and invalidity of active personnel

The commitments made by the Group to cover the contingencies of death and invalidity of employees during the time that they are active and are covered by an insurance policy taken out by way of co-insurance with Axa and Caser are recognised in the consolidated income statement for an amount equal to the that of the premiums on these insurance policies accruing in each financial year.

t) Other provisions and contingencies

The Group records provisions at the estimated value in order to meet current obligations resulting from past events that are clearly specified as regards their nature but which are indeterminate as regards amounts or the date of cancellation, and where cancellation will require disposal of resources that contain economic benefits. Said obligations may arise from the following:

• A legal or contractual provision.
• An implicit or tacit obligation originating from third parties' valid expectation, created by the Group, regarding the assumption of certain types of responsibilities. These expectations are created when the Group publicly accepts responsibilities, or they arise from past conduct or from business policies in the public domain.
• Practically certain changes in the rules on certain issues, particularly regulatory measures which the Group will not be able to avoid.

Contingent liabilities are possible obligations of the Group that arise as a consequence of past events, the materialisation of which depends on whether future events outside the Group's control occur or not. Contingent liabilities include present obligations of the Group, the cancellation of which is improbable and which leads to a reduction of resources including economic benefits and the amount of which, in extremely rare cases, cannot be quantified with sufficient reliability.

Contingent obligations and liabilities are considered probable when there is a greater likelihood that they will materialise than that they will not, possible when there is less likelihood that they will materialise than that they will not, and remote when their occurrence is extremely rare.

The Group includes in its consolidated financial statements all significant provisions for which it is estimated that the probability that the obligation will have to be met is greater than that it will not. Contingent liabilities are not recognised in the consolidated financial statements but are instead reported on unless the possibility is considered remote that that there will be a loss of resources that includes economic benefits.

Provisions are quantified on the basis of the best information available on the consequences of the event that gives rise to them and they are estimated at the end of each accounting year, including the financial effect if it is significant. These are used to meet specific obligations for which they were recognised, and are reversed either totally or partially when said obligations no longer exist.

As at 31 December 2014 and 2013 various legal proceedings and claims were being pursued against the Group in relation to the performance of its regular activities. Both the Group's legal advisors and the managers of the entity believe that the conclusion of these proceedings and claims will not have a significant impact on the consolidated financial statements, or as the case may be a significant additional impact to that already provided for.

u) Corporate Tax

Corporate tax is considered an expense and is recognised under the heading 'Corporate Tax' in the income statement except when it is the result of a transaction recognised directly in equity, in which case it is recognised directly in equity, or of a business combination, where the deferred tax is recognised as an asset of the combination.

Expenses under the heading 'Corporate Tax' are determined by the tax calculated on the tax base for the year, taking account of changes during the year arising from temporary differences, tax credits for deductions and allowances and negative tax bases. The tax base for the year may differ from the net profit or loss for the year as presented in the income statement, since it excludes income and expense items that are taxable or deductible in other financial years as well as items for which this is never the case.

Deferred tax assets and liabilities correspond to taxes that are expected to be payable or recoverable on the differences between the carrying amounts of the assets and liabilities in the financial statements and the corresponding tax bases. They are recognised using the liability method in the balance sheet and are quantified by applying the tax rate at which they are expected to be recovered or settled to the corresponding time difference or credit.

Deferred tax assets, such as tax paid in advance, credits for deductions and allowances, and credits for negative tax bases are recognised whenever it is probable that the Group will obtain sufficient taxable profits in the future against which to apply them. It is considered likely that the Group will obtain sufficient taxable profits in the following cases, amongst others:

• i) There are deferred tax liabilities that may be cancelled in the same year as the realisation of the deferred tax asset or in a subsequent year in which the Group can offset the negative tax base in existence or generated by the amount paid early.
• ii) The negative tax bases have been produced by identified causes that are unlikely to occur again.

Notwithstanding the foregoing, deferred tax assets that arise upon recognition of investments in joint ventures or associates are recognised only when it is probable that they will be realised in the foreseeable future, and sufficient taxable profits are expected in the future against which to apply them. Deferred tax assets are also not recognised when an asset that is not a business combination is initially recognised, and where at the time of recognition they have not affected the accounting or tax result.

Deferred tax liabilities are always recognised, except when goodwill is recognised or if they arise upon recognition of investments in joint ventures or associates, if the Group is able to control the timing of the reversal of the temporary difference and it is also probable that the difference will not reverse in the foreseeable future. Deferred tax liabilities are also not recognised when an asset that is not a business combination is initially recognised, and where at the time of recognition they have not affected the accounting or tax result.

At the end of each financial year the deferred taxes are revised, both assets and liabilities, in order to verify that they are still in effect and that the proper corrections are made.

The Group recognises deferred tax assets arising from deductible temporary differences, deductions or credits or in respect of negative tax bases only if the following conditions are met:

• it is considered probable that the consolidated entities will have sufficient future taxable profits against which to apply them; or they are guaranteed in accordance with the provisions of Royal Decree Law 14/2013 of 20 November on urgent measures to adapt Spanish law to EU legislation concerning the supervision and solvency of financial institutions, and
• in the case of deferred tax assets arising from negative tax bases, they have been produced by identified causes that are unlikely to occur again.

On the occasion of each accounting closure, the deferred taxes recognised are reviewed (both assets and liabilities) with a view to ensuring that they remain valid, with any necessary corrections to same being made in accordance with the results of the tests performed.

v) Off-balance-sheet customer resources

Resources entrusted by third parties for investment in companies and mutual funds, pension funds (insurance contracts), and discretionary portfolio management contracts are not included in the Group balance sheet. Information on these resources as at 31 December 2014 and 2013 can be found in Note 41.

Equity managed by consolidated companies owned by third parties is not included in the consolidated balance sheet. Fees generated by this activity are recognised under the heading 'Fees income' in the consolidated income statement. Note 41 provides information on third-party equity managed by the Group on 31 December 2014 and 2013 and during the financial years then ended.

Investment funds managed by consolidated companies are not recorded in the Group's consolidated balance sheet, as the equity in same is owned by third parties. Fees accrued in the financial year for the various services rendered to these funds by the companies in the Group (wealth management services, portfolio custody, etc.) are recognised under the heading "Fees received" in the consolidated Income Statement.

w) Insurance contracts

In accordance with the accounting practices that are generally used in the insurance sector, insurance institutions record in the profits the amounts of the premiums that they issue and debit from their income statement the cost of claims that they meet at the time of the final settlement thereof. These accounting practices oblige insurance institutions to accrue at the close of each financial year both the amounts paid for the premiums issued to their profit and loss accounts and not accrued at that date, and the foreseeable costs for claims that have occurred and which are pending debit to the income statement.

The most significant liabilities of these institutions as regards the direct insurance hired by same refer to the following: Provision for unearned premiums, for unexpired Risks, Provision for services, Mathematical provision, Life Insurance when the investment risk is undertaken by the policyholders and Participation in profits and for rebates. These technical provisions for direct insurance are recognised in the consolidated balance sheets under 'Insurance liabilities' to cover claims arising from said insurance contracts.

The item 'Reinsurance assets' contains the amounts that the institutions are entitled to receive that originate from the reinsurance contracts they hold with third parties. These are calculated according to the reinsurance contracts that have been signed and applying the same criteria that are used for direct insurance.

The results of the group's insurance companies from its insurance activity are recognised under the heading 'Insurance Activity' in the income statement.

6. Cash and balances at central banks

This heading comprises cash balances and balances held at Banco de España and other central banks. The breakdown as at 31 December 2014 and 2013 was as follows:

		€000s
	31/12/2014	31/12/2013
Cash	139,512	118,909
Banco de España	217,544	767,020
Other central banks	259	147
Valuation adjustments	12	42
	357,327	886,118
In euros	356,061	885,151
In foreign currency	1,266	967
	357,327	886,118

Shown under valuation adjustments is an amount of €11,000 representing accrued interest as at 31 December 2014 (€42,000 as at 31 December 2013).

7. Trading portfolio of assets and liabilities and Other financial assets and liabilities at fair value through profit or loss

The breakdown of these items of the consolidated balance sheets as at 31 December 2014 and 2013 is as follows:

		€000s
	31-12-2014	31-12-2013
Asset:
Deposits with credit institutions	544,528	920,112
Loans and advances to customers	1,967,180	979,439
Debt instruments	2,345,496	1,736,671
Other equity instruments	108,793	84,820
Trading derivatives	436,958	643,689
	5,402,955	4,364,731
In euros	5,401,818	4,277,421
In foreign currency	1,137	87,310
	5,402,955	4,364,731

The amounts shown against "Deposits with credit institutions" and "Lending to customers" as at 31 December 2014 and 2013 relate mainly to temporary acquisitions of assets.

As at 31 December 2013

"Other equity instruments" includes the securities forming part of the trading portfolio, as well as other financial assets at fair value through profit or loss. The balance of the latter as at 31 December 2014 stood at €49.47 million (€18.16 million as at 31 December 2013).

The fair value of the loaned assets (assets assigned temporarily) in the trading portfolio on the asset side of the Balance Sheet as at 31 December 2014 was €1,700.68 million (€961.81 million as at 31 December 2013). Practically the whole of these assets have been ceded for terms of less than one year.

The breakdown of the financial assets and liabilities held for trading and other financial assets at fair value through profit or loss in the consolidated balance sheet as at 31 December 2014 and 2013, by instrument type and counterparty, is as follows:

As at 31 December 2014

						€000s
		As at 31 December 2014
	Credit institutions	Non-resident Public Admins.	Non-resident Public Admins.	Other Private Sector Resident	Other Private Sector Non resident	Total
Deposits with credit institutions	544,528	-	-	-	-	544,528
Loans and advances to customers	-	-	-	1,967,180	-	1,967,180
Debt instruments	63,907	2,092,940	174,521	7,587	6,541	2,345,496
Other equity instruments	40,821	-	-	17,620	50,352	108,793
Trading derivatives	257,174	-	-	179,745	39	436,958
	906,430	2,092,940	174,521	2,172,131	56,932	5,402,955

						€000s
					As at 31	December 2013
	Credit institutions	Non-resident Public Admins.	Non-resident Public Admins.	Other Private Sector Resident	Other Private Sector Non resident	Total
Deposits with credit institutions	920,112	-	-	-	-	920,112
Loans and advances to customers	-	-	-	979,439	-	979,439
Debt instruments	60,828	1,672,857	2	1,986	998	1,736,671
Other equity instruments	48,787	-	-	16,561	19,472	84,820
Trading derivatives	524,630	16	-	118,477	566	643,689
	1,554,357	1,672,873	2	1,116,463	21,036	4,364,731

The fair value of the guarantees received by the Group (financial and non-financial assets) that the Group is authorised to sell or pledge without the owner of the guarantee having defaulted on payment is lacking in relative importance considering the Group's financial statements as a whole.

The breakdown of the liabilities in the trading portfolio is as follows:

		€000s
Liabilities	31/12/2014	31/12/2013
Deposits from credit institutions	270,621
Customer deposits	451,559	193,482
Trading derivatives	322,598	252,537
Short positions in securities	1,396,713	1,305,702
	2,441,491	1,751,721
In euros	2,440,351	1,750,015
In foreign currency	1,140	1,706
	2,441,491	1,751,721

The amount shown against "Customer deposits" as at 31 December 2014 relates mainly to temporary assignments of assets.

Net gains and losses on financial transactions (Note 31) generate by these portfolios are detailed hereunder:

		€000s
	2014	2013
Trading portfolio (Note 31)	14,982	18,163
Organised market	19,520	22,877
Non-organised market	(4,538)	(4,714)
Other financial assets carried at fair value through profit or
loss (Note 31)	1,163	8,228
	16,145	26,391

The net results by financial operation, broken down by the type of instrument in the trading portfolio and other financial assets at fair value through profit or loss recognised in financial years 2014 and 2013, are as follows:

	€000s
	2014	2013
Fixed income for trading (Note 31)	24,676	21,822
Other equity instruments (Note 31)	3,805	22,986
Held for trading	2,642	14,758
Other financial assets at fair value through profit or loss	1,163	8,228
Trading derivatives (Note 31)	(12,336)	(18,417)
	16,145	26,391

a) Debt instruments

The breakdown of this item in financial assets held for trading in the consolidated balance sheet as at 31 December 2014 and 2013 was as follows:

		€000s
	31/12/2014	31/12/2013
Public Administrations	2,092,840	1,672,857
Other private sectors	252,656	63,814
	2,345,496	1,736,671

The breakdown of this item in accordance with the nature of the securities that make it up as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014 31/12/2013
Treasury Bills	76,845	188,990
Bonds	1,392,633	919,228
Debentures	511,649	512,904
Scrip	111,814	43,909
Other	252,555	71,640
	2,345,496	1,736,671

All of the amounts in this item are denominated in euros. The asset trading portfolio is composed of securities traded on organised markets as at 31 December 2014 and 2013.

b) Other equity instruments

The breakdown of this heading of the asset trading portfolio and of other financial assets at fair value through profit or loss for financial years 2014 and 2013 is as follows:

	€000s
	From Credit	From other resident	From other non-resident
	Institutions	sectors	sectors	Total
Balance at 31/12/2013	48,787	16,561	19,472	84,820
Balance at 31/12/2014	40,821	17,620	50,352	108,793

The majority of the instruments under Other equity instruments on the Bankinter Group balance sheet are denominated in euros both in 2014 and in 2013.

c) Trading derivatives

The breakdown of this item in the financial assets and liabilities held for trading for assets in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
		Fair value
	31/12/2014		31/12/2013
	Assets	Liabilities	Assets	Liabilities
Purchase and sale of unmatured forward exchange contracts:	189,870	39,879	439,769	16,060
Currency purchases against euros	43,045	40,202	56,918	3,535
Currency purchases against other currencies	18,807	77	10,415	4,581
Currency sales against euros	128,016	(406)	371,594	6,488
Currency sales against other currencies	2	6	842	1,456
Securities options:	19,323	43,320	19,022	45,399
Bought	19,323	5,886	19,022	12,285
Issued	-	37,434	-	33,114
Interest-rate options:	2,950	88,764	889	1,079
Bought	2,950	88,764	889	1,079
Currency options:	-	10	47	754
Bought	-	-	47	-
Issued	-	10	-	754
Other interest-rate operations:	224,815	150,625	183,962	189,246
Interest-rate swaps (IRSs)	224,815	150,625	183,962	189,246
	436,958	322,598	643,689	252,537

d) Short positions

This heading in the Balance Sheet consists of the financial liabilities originated by short selling to the value of €1,396.71 million as at 31 December 2014 (€1,305.70 million as at 31 December 2013). The balances are denominated in euros. These short positions are generated by the firm sale of financial assets acquired temporarily.

8. Financial assets available for sale

The breakdown of this heading in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Debt instruments	2,845,308	2,321,671
Other equity instruments	168,505	161,500
	3,013,813	2,483,171
In euros	2,716,992	2,472,373
In foreign currency	296,821	10,798
	3,013,813	2,483,171

The fair value of the assets under this item of the consolidated Balance Sheet as at 31 December 2014 loaned or in guarantee was €746.29 million (€799.41 million as at 31 December 2013). Practically all these assets are assigned for terms of less than one year.

The effect on the item "Valuation adjustments" in consolidated equity was €123.73 million as at 31 December 2014 (€41.62 million as at 31 December 2013). The following is the breakdown of the movement:

	€000s
	2014 2013
Valuation adjustments as at 1 January	41,605	3,145
Valuation gains and losses	159,725	161,238
Income tax	(35,195)	(16,484)
Amounts transferred to results	(42,408)	(106,294)
Valuation adjustments as at 31 December	123,727	41,605
Debt securities	118,199	42,415
Equity instruments	5,528	(810)

Geographically, the portfolio of available-for-sale financial assets is concentrated mainly in Spain as at 31 December 2014 and 2013.

The breakdown of this item in accordance with the nature of the securities that make it up as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Fixed Income	2,845,308	2,321,671
Debt	676,249	831,870
Other Fixed Income	2,169,059	1,489,801
Equities	168,505	161,500

The breakdown of this heading in the balance sheet as at 31 December 2014 and 2013, by type of instrument and counterparty, is as follows:

	€000s
	31/12/2014
	Resident Public Other Private
	Administrations	Sectors	Total
Debt instruments	1,591,649	1,253,659	2,845,308
Other equity instruments	-	168,505	168,505
	1,591,649	1,422,164	3,013,813

		€000s
		31/12/2013
	Resident Public Administrations	Other Private Sectors	Total
Debt instruments	831,870	1,489,801	2,321,671
Other equity instruments	-	161,500	161,500
	831,870	1,651,301	2,483,171

The results for financial operations (Note 31) according to the type of instrument in the portfolio of available-for-sale financial assets recognised in the consolidated income statement as at 31 December 2014 and 2013 are as follows:

		€000s
	31/12/2014 31/12/2013
Debt instruments	35,886	99,435
Other equity instruments	6,522	6,858
	42,408	106,293

In 2014 and 2013, for Other Equity Instruments, the Group recognised impairment losses of €3.52 million and €9.36 million respectively, under the heading "Impairment losses on available-for-sale financial assets" in the enclosed consolidated income statement.

To estimate impairment of equity instruments included in available-for-sale financial assets, the Bank carries out an individual analysis of the impairment of each significant security. However, the Group's accounting policies establish that, in any case, a prolonged or significant decline in fair value below their cost is objective evidence of impairment and an impairment loss must accordingly be recognised for the difference between the cost and the fair value of the instrument concerned. Specifically, in the case of listed equity instruments, the accounting policy considers that a decline is prolonged when the fair value of the instrument has been below its cost for more than 18 months, and significant when it is more than 40% of its cost.

During 2014 no impairments of investments in equity instruments included in the available-for-sale financial assets portfolio were recognised as a result of prolonged or significant declines in their value.

At year-end 2014 and 2013 the composition of the carrying amount under "Valuation adjustments" broken down separately into gains and losses was as follows:

	€000s
	31/12/2014	31/12/2013
Debt instruments Capital gains	123,932	53,929
Debt instruments Capital losses	(5,733)	(11,514)
Total Fixed Income	118,199 42,415
Equity instruments: Capital gains	11,688	9,346
Equity instruments: Capital losses	(6,160)	(10,156)
Total Equities	5,528 (810)
Balance at close of period	123,727 41,605

9. Held to maturity investments

The breakdown of this item in the consolidated balance sheets as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014 31/12/2013
Public administrations	2,805,744	3,174,823
Credit institutions	13,738	45,898
	2,819,482	3,220,721

The changes that occurred in the chapter "Held-to-maturity portfolio" in the financial years 2014 and 2013 are as follows:

	€000s
	2014 2013
Balance at start of period	3,220,721	2,755,355
Additions	-	465,366
Depreciation and amortisation	(401,239)	-
Balance at close of period	2,819,482	3,220,721

In 2014 and 2013 there were no transfers from this portfolio to other accounting portfolios or vice versa.

As at 31 December 2014 and 2013 the portfolio of held-to-maturity investments was mainly concentrated in Spanish Public Administrations. The Market Risks division values these references on a monthly basis to confirm that they can be counted as liquid assets for calculating the Basel III Liquidity Coverage Ratio (LCR). As at 31 December 2014 and 2013 the entire portfolio was denominated in euros.

10. Loans and receivables

The breakdown of this item in the consolidated balance sheets as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Deposits with credit institutions	1,106,018	1,174,050
Valuation adjustments	7,423	8,165
Total bank deposits	1,113,441	1,182,215
Loans and advances to customers	43,397,799	42,268,292
Valuation adjustments	(951,076)	(961,282)
Total customer lending	42,446,723	41,307,010
Total Debt instruments	446,357	117,825
	44,006,521	42,607,050
Euros	40,733,377	39,237,733
Foreign currency	3,273,144	3,369,317
	44,006,521	42,607,050

The valuation adjustments of the loan and receivables portfolio, as at 31 December 2014 and 2013 present the following figures:

	€000s
	31/12/2014 31/12/2013
Valuation corrections due to asset impairment	(945,523)	(947,984)
Accrued interest	97,799	99,029
Micro-hedging operations	3,397	(74)
Other	(99,326)	(104,088)
	(943,653)	(953,117)

€000s 2014 2013 Balance at start of period 2,234,982 1,956,688 Net additions 172,812 510,524 Transferred to bad debts (213,226) (232,230) Balance at close of period 2,194,568 2,234,982

The following are the details of the changes that occurred during 2014 and 2013 in

the balance of financial assets classified as impaired due to their credit risk:

The breakdown of this item of the consolidated balance sheet as at 31 December 2014 and 2013, by instrument type and counterparty, irrespective of the fair value that may be attributable to any kind of guarantee to ensure performance, is as follows:

	€000s
	31-12-2014			31-12-2013
	Bank deposits	Loans and advances to customers	Debt instru ments	Total	Bank deposits	Loans and advances to customers	Debt instru ments	Total
Banks	1,113,441	-		1,113,441	1,182,215	-		1,182,215
Resident Public Administrations	-	1,704,402	308,921	2,013,323	-	2,340,652	16,110	2,356,762
Other private sectors	-	40,742,321	137,436	40,879,757	-	38,966,358		101,715 39,068,073
	1,113,441	42,446,723	446,357	44,006,521	1,182,215	41,307,010		117,825 42,607,050

The following are the changes that occurred during 2014 and 2013 in the balance of the provisions that cover losses due to impairment of the assets that make up the balance of "Loans and Receivables".

	€000s
	31-12-2014	31-12-2013
Balance at start of period	947,984	953,385
Net additions to provisions charged to profit and loss	190,440	243,098
Additions charged to profit and loss for the period;	836,195	1,021,662
Recoveries credited to P&L	(645,755)	(778,564)
Used	(188,239)	(232,275)
Other movements/transfers	(4,662)	(16,224)
Balance at close of financial year	945,523	947,984
Of which:
Calculated on an individual basis	917,172	896,721
Calculated on a collective basis	28,351	51,263

The suspended assets recovered during 2014 and 2013 total €9.5 million and €20.19 respectively. During 2014 and 2013, the Group recorded losses of €52.93 million and €57.93 million due to the impairment of foreclosed assets (Note 12).

Interest and return generated by lending, recognised in the consolidated income statement as at 31 December 2014 and 2013 are as follows:

	€000s
	2014	2013
Deposits with credit institutions (Note 30)	7,321	10,268
Loans to customers (Note 30)	1,070,052	1,074,747
	1,077,373	1,085,015

a) Deposits with credit institutions

b) Loans and advances to customers

The breakdown of this item in the loans and receivables portfolio for the assets in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

The breakdown of this item in the loans and receivables portfolio for the assets in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
Loans and advances to customers	31/12/2014	31/12/2013
Public Administrations	1,704,402	2,340,652
Loans to Public Administrations	1,696,895	2,332,642
Impaired assets	401	562
Valuation adjustments	7,106	7,448
Accrued interest	7,510	7,968
Other	(404)	(520)
Other private sectors	40,742,321	38,966,358
Commercial lending	2,016,997	2,052,599
Receivables secured by collateral	25,353,414	25,269,668
Assets held temporarily	-	110,559
Other non-current receivables	9,899,189	8,449,344
Finance leases	968,590	796,605
Sight debtors and miscellaneous	1,268,146	1,021,918
Impaired assets	2,194,167	2,234,395
Valuation adjustments	(958,182)	(968,730)
Valuation corrections due to asset impairment	(945,523)	(947,984)
Accrued interest	82,870	82,950
Micro-hedging transactions	3,397	(74)
Other	(98,926)	(103,622)
	42,446,723	41,307,010
In euros	39,327,259	38,051,703
In foreign currency	3,119,464	3,255,307
	42,446,723	41,307,010

		€000s
	31/12/2014	31/12/2013
Term accounts	14,904	24,040
Assets held temporarily	299,725	299,131
Other accounts	791,389	850,853
Of which, managed as cash	521,377	455,294
Impaired assets	-	25
Valuation adjustments	7,423	8,166
Accrued interest	7,419	8,111
Other	4	55
	1,113,441	1,182,215
In euros	959,761	1,068,205
In foreign currency	153,680	114,010
	1,113,441	1,182,215

The breakdown of impaired assets by maturity as at 31 December 2014 and 2013 was as follows:

	€000s
	31/12/2014
Up to 6 months	427,812
More than 6 months but not more than 9	146,960
More than 9 months but not more than 12	140,055
More than 12 months	1,479,741
	2,194,568

	€000s
	31/12/2013
Up to 6 months	534,916
More than 6 months but not more than 9	221,027
More than 9 months but not more than 12	184,084
More than 12 months	1,294,955
	2,234,982

Assets matured and not impaired as at 31 December 2014 amounted to €206.9 million (€92.27 million as at 31 December 2013).

c) Information on leases

c.1) Finance leases

Finance lease agreements for financial years 2014 and 2013, have the following characteristics:

	2014	2013
Average life	4.8 years	4.9 years
Maximum differential	7.00%	9.00%

The distribution of finance lease lending as at 31 December 2014 and 2013 is as follows:

	31/12/2014	31/12/2013
Tourism	10.64%	10.48%
Assorted machinery	47.65%	63.57%
Transport vehicles	38.71%	24.63%
Other	3.00%	1.32%
	100.00%	100.00%

c.2) Operating leases

The balance of assets leased out under operating leases and included in the balance sheet as at 31 December 2014 was €24.66 million (€26.95 million at 31 December 2013).

The amounts of minimum rentals in operating lease contracts in which the Bank acts as lessor as at 31 December 2014 and 2013 were as follows;

	€000s
	2014	2013
Operating leases - Minimum rentals:
Less than one year	2,979	2,906
From one to five years	12,433	13,677
More than 5 years	7,989	9,723

As at 31 December 2014 and 2013 there were no rentals of a contingent nature in the operating lease in force at that time.

d) Debt instruments

The breakdown of the heading Debt securities in the loans and receivables section of the consolidated Balance Sheet as at 31 December 2014 and 2013 is as follows:

	€000s
	2014	2013
Resident Public Administrations	308,921	16,110
Instituto de Crédito Oficial (Official Spanish government credit agency)	5,144	5,147
Other resident sectors	132,292	96,568
	446,357	117,825

There are no impaired positions among the debt securities of this portfolio.

11. Asset/liability hedging derivatives

As at 31 December 2014, the Group held hedge derivatives in the amount of €148.21 million, shown on the asset side of the balance sheet and €20.24 million on the liabilities side (€84.48 million and €25.61 million respectively as at 31 December 2013). Net derivatives accordingly amounted to €127.97 million and €58.87 million as at 31 December 2014 and 2013 respectively.

The breakdown of the hedging derivatives and the corresponding hedged elements, differentiating according to the type of hedging, is as follows:

					€000s		€000s
					Fair value of the Hedged Instrument attributed to the hedged risk			Fair value Hedging Instrument (ex-interest)
Hedged Instrument	Type of Hedging	Hedging Instrument	Nominal Hedged (€ million)	Nature of Hedged Risk	31-12-2014	31-12-2013	31-12-2014	31-12-2013
Individual hedges or Micro hedges:
Financial assets
Spanish public debt, euros	Individual hedges or Micro-hedges:	Interest-rate swaps	212	Interest Rate	10,248	21,998	(10,541)	(21,865)
Italian public debt, euros	Individual hedges or Micro-hedges:	Interest-rate swaps	55	Interest Rate	2,280	-	(2,299)	-
Other fixed income, euros	Individual hedges or Micro-hedges:	Interest-rate swaps	3	Interest Rate	163	-	(162)	-
Other fixed income, USD	Individual hedges or Micro-hedges:	Interest-rate swaps	62	Interest Rate	861	-	(866)	-
Loan in USD	Individual hedges or Micro-hedges:	Interest-rate swaps	127	Interest Rate	3,397	(74)	( 3,428)	70
Financial liabilities
Subordinated Debt	Individual hedges or Micro-hedges:	Interest-rate swaps	790	Interest Rate	(69,995)	(44,317)	71,723	45,677
Senior debt	Individual hedges or Micro-hedges:	Interest-rate swaps	-	Interest Rate				-
Customer Deposits	Individual hedges or Micro-hedges:	Interest-rate swaps	4	Interest Rate	(1,233)	(1,412)	1,233	1,412
Mortgage Bond Issues	Individual hedges or Micro-hedges:	Interest-rate swaps	3,090	Interest Rate	(49,475)	(20,244)	49,696	20,393
Macro-hedging-			-			-		-
Mortgage Loans	Macro-hedging	Interest-rate swaps	4,343	Interest Rate	(103,754)	(44,049)	105,356	45,687

The following is a comparison of cum-interest and ex-interest hedging instruments as at 31 December 2014 and 2013:

	€000s
	31-12-2014			31-12-2013
	With interest	Ex-interest	With interest	Ex-interest
Spanish public debt, euros	(5,219)	( 10,540)	(24,765)	(21,865)
Italian public debt, euros	(2,390)	( 2,299)	-	-
Other fixed income, euros	( 169)	( 162)	-	-
Other fixed income, USD	(1,017)	( 866)	-	-
Loan in USD	( 4,040)	( 3,428)	63	70
Subordinated Debt	76,121	71,723	47,898	45,677
Senior debt	-	-	-	-
Customer Deposits	(1,257)	1,233	(514)	1,412
Mortgage Bond Issues	65,943	49,696	36,191	20,393
Macro-hedging - Mortgage loans		-	-	-
Other		-	-	-
	127,972	105,356	58,873	45,687

The Group uses interest-rate swaps as hedging instruments. These swaps give rise to an economic interest rate exchange with no principal being exchanged.

The gains generated by hedging instruments in 2014 amounted to €38.36 million, (€33.65 million loss in 2013.) The losses recognised on items hedged by these transactions amounted to €38.28 million, (€32.85 million gains in 2013.)

The following is a description of the main characteristics of the bank's hedges as at 31 December 2014.

1.- Spanish Public Debt Hedging classified in the portfolio of available-for-sale assets

In these hedges, the hedged items are two Spanish State Public Debt asset swap securities for nominal amounts of €152 million at 5.15% and €60 million at 5.9%, and a bond asset swap of Italian State Public Debt for €55 million at 3.75% recognised under "Available-for-sale financial assets" in the assets included in Note 8. The risk hedged is the change in the fair value of these securities as a result of changes in the risk-free interest rate. The accounting hedge is used to exchange exposure to fixed interest for exposure to variable interest. In each case, the amount hedged represents 100% of the issue.

2.- Hedging of Italian Public Debt classified in the portfolio of available-for-sale assets

In these hedges the hedged item is a bond asset swap of Italian State Public Debt for a nominal amount of €55 million at 3.75%, recognised under "Available-for-sale financial assets" in the assets included in Note 8. The risk hedged is the change in the fair value of these securities as a result of changes in the risk-free interest rate. The accounting hedge is used to exchange exposure to fixed interest for exposure to variable interest. In each case, the amount hedged represents 100% of the issue.

3.- Hedging of other fixed income in euros classified in the portfolio of available-forsale assets

The hedged item is a Telefónica bond asset swap at 2.932% for a nominal amount of €2.8million recognised under "Available-for-sale financial assets" in the assets included in Note 8. The risk hedged is the change in the fair value of these securities as a result of changes in the risk-free interest rate. The accounting hedge is used to exchange exposure to fixed interest for exposure to variable interest. In each case, the amount hedged represents 100% of the issue.

4.- Hedging of other fixed income in dollars classified in the portfolio of availablefor-sale assets

The hedged items are US dollar denominated notes: US92857WBC38 (€4.12 million), US05578DAG79 (€12.35 million), US655044AH83 (€12.35 million), US92343VBR42 (€4.12 million), US92343VCR33 (€4.12 million), US92553PAT93 (€8.24 million), US25152RXA66 (€4.12 million), US552081AK73 (€12.35 million).

5.- Hedging of issues of subordinated bonds

In this case the items hedged are subordinated bonds issued by Bankinter at fixed interest rates of 6.00% and 6.375% for a total amount of €290 million, shown under the heading 'Financial liabilities at amortised cost' included in Note 19. The risk hedged is the change in the fair value of these securities as a result of changes in the risk-free interest rate. This accounting hedge is used to transform exposure to a fixed interest rate into exposure to a variable interest rate. In each case, the amount hedged represents 100% of the issue.

6.- Hedging of Customer Deposits

The elements hedged are various fixed-rate deposits taken from customers in the amount of €4 million and shown under the heading "Financial liabilities at amortised cost" included in Note 19. The risk hedged is the change in the fair value of these deposits as a result of changes in the risk-free interest rate. This accounting hedge is used to transform exposure to a fixed interest rate into exposure to a variable interest rate. The amount hedged is 100% of the issue.

7.- Hedging of mortgage-backed bond issues

The instruments hedged are issues ES0413679178 (€1 billion), ES0413679202 (€500 million), ES0413679178 (€1 billion), and ES0413679277 (€590 million) of mortgage bonds for a total nominal value of €3.09 billion.

The risk hedged is the six-month interest rate risk at the start of each interest period to which the above fixed-income instrument is exposed as a consequence of changes in the risk-free interest rate, excluding changes due to possible credit risk premiums, market liquidity or any other than the aforementioned interest-rate risk.

8.- Loan hedging

The items hedged are two loans in US dollars for nominal amounts of €112.8 million and €14.4 million. The latter loan has pre-established quarterly repayments.

The risk hedged is the change in the fair value of the loan as a result of changes in the risk-free interest rate. This accounting hedge is used to transform exposure to a fixed interest rate into exposure to a variable interest rate. The amount hedged is 100% for the deposit.

Effectiveness of the hedging:

The micro-hedges previously described are highly effective. The Bank performs and documents the necessary analyses to verify that at the start and during the lifetime of same, it is possible to expect, on a prospective basis, that the changes in the fair value of the hedged item that are attributable to the hedged risk will be almost fully compensated for by the changes in the fair value of the hedging instrument and, on a retrospective basis, that the results of the hedging will have fluctuated within a range of variation of between eighty and one hundred and twenty-five percent from the result of the hedged item.

As regards portfolio hedges, as well as the foregoing, the Bank verifies compliance with the alternative, described in current applicable accounting regulations, of appraising their effectiveness by comparing the amount of the net asset position in each of the time periods with the hedged amount designated for each one. According to this alternative, the hedge would be ineffective only if upon review the amount of the net asset position were lower than the hedged amount.

12. Non-current assets held for sale

Balances and movements of non-current assets held for sale during 2014 and 2013 were as follows:

	€000s
Balance at 31.12.2012	381,141
Additions	256,804
Valuation adjustments	(28,092)
Cancellations	(240,643)
Balance at 31.12.2013	369,210
Additions	236,541
Valuation adjustments	29,458
Cancellations	(278,538)
Balance at 31.12.2014	356,671

Movements in valuation adjustments to non-current assets for sale throughout the financial years 2014 and 2013 were as follows:

	€000s
	2014 2013
Starting balance	258,616	230,524
Net provisions charged to results	65,181	100,277
Of which due to insolvency	52,932	57,929
Of which due to ageing effect (Note 35)	12,249	42,348
Application of funds	(99,746)	(76,430)
Other movements	5,108	4,245
End balance	229,159	258,616

Net losses recognised in 2014 (Note 35) on disposals of non-current assets held for sale amounted to €42.47 million (€50.44 million in 2013).

The following is the classification of repossessed properties by category and average length of time in the portfolio of non-current assets for sale:

	€000s
		Residential assets		Industrial assets Other Assets		Totals
				31/12/2014 31/12/2013 31/12/2014 31/12/2013 31/12/2014 31/12/2013 31/12/2014 31/12/2013
Up to one month	16,917	14,390	1,223	9,689	100	6,783	18,239	30,862
Between one and three months	21,194	22,183	9,492	7,492	8,840	1,895	39,526	31,570
Between three and six months	15,392	16,058	12,383	9,446	1,480	1,285	29,256	26,789
Between six and twelve months	32,889	28,628	17,477	21,379	5,564	7,301	55,930	57,308
More than one year	102,049	105,102	55,800	55,934	55,870	61,645	213,719	222,681
	188,441	186,361	96,375	103,940	71,854	78,909	356,670	369,210

Table 5 of Note 47 shows further details of repossessed assets.

Repossessed assets that are not destined for proprietary use or property investments should be disposed of within a maximum timeframe of one year from the moment that they become available for immediate sale. This latter circumstance determines that the period for which a repossessed asset remains in the balance sheet may exceed one year.

The distribution of repossessed assets by business segment is as follows, as at December 2014 and 2013:

Segments	31/12/2014	31/12/2013
Companies	44%	48%
Commercial Banking	56%	52%
Grand total	100%	100%

From 31 December 2014 to the date on which these financial statements were drafted, no significant amounts have been recognised under the item 'Non-current assets for sale' in the consolidated balance sheet.

Repossessed assets consist of assets repossessed in payment of debts, dations in payment of debts and acquisitions of assets with subrogation to companies in the Group. Initially, these assets are recognised at the net carrying amount of the debts from which they originated and the losses recognised on impairment are not released. Subsequently, these assets are valued at the lower of the net carrying amount of the relevant loan on the date of the acquisition or the fair value of the repossessed asset (estimated on the basis of its appraisal value), with a downward adjustment according to the time that the asset has remained in the consolidated balance sheet. The appraisal value of non-current assets for sale has been estimated, basically, using appraisals performed by firms registered in the Register of Bodies Specialising in Appraisal held at Banco de España. All these assets were denominated in euros as at 31 December 2014 and 2013.

The following table lists the appraisal companies that have valued assets during 2014, together with the total amount appraised for each asset class.

The vast majority of appraisals carried out by Tecnitasa, Cohispania, Ibertasa, Valmesa and Gesvalt for Bankinter in 2014 were carried out in compliance with Ministerial Order ECO 805/2003. The technical valuation methods habitually used are: the cost method, the comparative method, the investment or income capitalisation method and the residual method.

The Bankinter Group uses its subsidiary Intermobiliaria, S.A., as the management company for assets originating from problem lending (repossessions, properties accepted in payment of debts, etc.) This company was incorporated on 16 February 1976 and has its registered offices at Paseo de la Castellana 29, Madrid. The Group's general policy is that all assets originating from problem loans should be registered in the name of this subsidiary, although there may occasionally be circumstances that make it desirable for such registration to be carried out directly in the name of the parent company.

Since the current policy on repossessions was adopted and up until the date of these financial statements, the cumulative volume of assets originating from problem lending in this subsidiary is €1,324,501,000.

				€000s
Appraisal companies	Residential assets			Industrial assets		Other Assets	Totals
	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013
GESVALT SOCIEDAD DE TASACION S.A.	85,015	90,905	48,644	70,274	44,135	39,984	177,794	201,163
IBERTASA S.A.	56,169	48,515	32,605	35,174	34,651	29,871	123,425	113,560
TECNICOS EN TASACION S.A. TECNITASA	55,399	81,512	37,687	25,977	21,285	10,034	114,371	117,522
CIA HISPANIA DE TASACIONES Y VALORACIONES S.A.	54,452	61,569	26,754	29,348	12,973	11,834	94,178	102,751
VALORACIONES MEDITERRANEO S.A.	27,253	38,844	19,551	23,673	28,992	33,192	75,797	95,709
TINSA TASACIONES INMOBILIARIAS S.A.	5,988	7,236	8,301	12,131	16,947	22,581	31,237	41,948
INTERNACIONAL DE TRANSACCIONES Y SERVICIOS S.A.	-	-	-	-	8,523	8,523	8,523	8,523
VALTECNIC S.A.	3,134	4,191	630	1,558	2,701	3,509	6,466	9,259
TASACIONES HIPOTECARIAS S.A.	141	141	-	-	3,462	3,462	3,603	3,603
CATSA S.L.	2,535	2,535	-	-	-	-	2,535	2,535
OTHERS	1,534	2,295	1,802	5,762	4,410	10,729	7,746	18,786
Totals	291,620	337,743	175,974	203,897	178,079	173,719	645,675	715,359

The acquisition of these assets is financed by the parent company on market terms. The resources made available to Intermobiliaria by the parent company as at 31 December 2014 and 2013 are summarised in the following table:

	€000s
	31/12/2014	31/12/2013
Capital contributions	7,319	7,319
Participating loans	500,000	400,000
Loan account	278,600	259,628
Collateralised loans	71,421	132,067
	857,340	799,014

In this past year the volume of assets transferred to Intermobiliaria was €209.33 million (€237.44 million in 2013), generating a loss of €52.93 million (€57.93 million in 2013). These acquisitions are financed entirely by the parent company.

Outstandings under guarantees executed (assets foreclosed) held by Bankinter and Intermobiliaria as at December 2014 and 2013 were as follows;

	2014	2013
Bankinter	33,633	30,474
Intermobiliaria	221,931	201,111
	255,564	231,585

Outstandings under amounts financed in respect of sales of foreclosed assets as at December 2014 and 2013 were as follows;

	2014	2013
Bankinter	7,603	3,410
Intermobiliaria	62,920	48,330
	70,523	51,740

13. Investments

The breakdown of this item in the consolidated balance sheets as at 31 December 2014 and 2013 is as follows:

		€000s
	31/12/2014	31/12/2013
Associates	28,857	35,932
Jointly controlled entities	869	430
	29,726	36,362

The changes that occurred in the balance for this heading are shown below:

	€000s
	2014	2013
Balance at start of period	36,362	40,600
Transfers from Group entities	40	-
Transfer of companies from Group entities	-	(644)
Share in profits (losses) of entities accounted for using the equity method	16,962	15,545
b) Dividends received by the Bank	(26,539)	(17,005)
Other movements	2,901	(2,134)
Balance at close of financial year	29,726	36,362

During 2014, no corporate activity was carried out that changed the composition of the consolidated group.

With the purpose of complementing its private banking strategy, Bankinter, S.A. reached agreement in December 2012 with Dutch bank Van Lanschot Bankiers N.V. to acquire its Luxembourg subsidiary Van Lanschot Bankiers (Luxembourg) S.A. for an amount of €21.55 million, leading to goodwill of €2.45 million being recognised. The agreement was executed and the company accordingly incorporated into the Group in the first half of 2013.

Castellana Finance Limited is a special purpose vehicle established in 2007. This vehicle was initially outside the consolidation scope, basically because the Group retained no material risks or rewards. However, during the first half of 2013 its situation of control was reviewed, and it was concluded that it should be integrated into the Group as at 30 June 2013. This review was undertaken after successive purchases by Bankinter, S.A. of bonds issued by the vehicle, which had also restructured its balance sheet.

During the fourth quarter of 2013 the Group, which held 25.01% of the shares in Mercavalor, S.V., S.A., acquired all the remaining shares in the company, which was accordingly then fully consolidated, leading to a reduction of €0.64 million in the portfolio of associates as at 31 December 2013.

During the fourth quarter of 2014 the Group, which held 32.01% of the shares in Eurobits Technologies, S.L., increased its holding to 71.98%.

The financial statements of Eurobits Technologies, S.L. and Helena Activos Líquidos, S.L. are as at 30 November 2014. The impact on the consolidated financial statements deriving from the use of financial statements as at dates prior to 31 December 2014 for these companies is not material.

Intermobiliaria S.A. is in a negative equity situation. Bankinter uses this company as the management company for all the Group's real estate activity, and is committed to compensating its losses and restoring it to positive equity within the legal timeframes by granting a participating loan. This participating loan was granted by Bankinter, S.A. on 24 June 2010 for an amount of €100 million. It was later increased, to €200 million on 29 December 2011, and to €300 million on 27 December 2012. At 31 December 2013 the amount of this loan stood at €400 million, and at 31 December 2014, €500 million. The participating loan is recognised under "Long-term debt to group companies and associates" on the liabilities side of the subsidiary's balance sheet; this participating loan meets the requirements laid down by Royal Decree Law 7/1996 of 7 June on urgent tax measures and measures to foster and deregulate economic activity for it to be considered as equity for the purposes of company law. By means of this transaction the Company has re-established its positive equity position.

Details of fully consolidated Group companies as at 31 December 2014 are as follows:

Financial year 2014

				% holding		Summarised financial information
Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	% indirect holding of Bankinter	% total holding	Dividends paid	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A.	A78757143	Paseo de la Castellana, 29 28046 Madrid	99.99	0.01	100		35,222	30	1,060	29,045	428	30,534	30,534	28,060	31,550	1,016
Bankinter Gestión de Activos, S.G.I.I.C.	A78368909	Calle Marqués de Riscal 11. 28010 Madrid	99.99	0.01	100	10,283	144,599	30	4,345	17,170	26,281	47,796	44,310	4,522	68,216	23,906
Hispamarket, S.A.	A28232056	Paseo de la Castellana, 29 28046 Madrid	99.99	0.01	100		4,516,452	6	27,144	(125)	673	27,693	29,087	26,962	116,928	87,841
Intermobiliaria, S.A.	A28420784	Paseo de la Castellana, 29 28046 Madrid	99.99	0.01	100		243,546	30	7,319	(308,755)	(75,013)	(376,450)	(376,450)	42,497	486,005	862,455
Bankinter Consumer Finance, E.F.C., S.A.	A82650672	Avda de Bruselas 12, Alcobendas. 28108 Madrid	99.99	0.01	100	6,138	1,299,999	30	39,065	45,720	25,891	110,676	105,891	60,002	377,938	272,047
Bankinter Capital Riesgo, SGECR, S.A.	A83058214	Paseo de la Castellana, 29 28046 Madrid	96.77	3.23	100		3,100	100	310	739	197	1,246	1,246	239	1,440	195
Bankinter Sociedad de Financiación, S.A.U.	A84129378	Paseo de la Castellana, 29 28046 Madrid	100	-	100		602	100	60	2,354	77	2,492	2,492	60		3,696,331 3,693,840
Bankinter Emisiones, S.A.U.	A84009083	Paseo de la Castellana, 29 28046 Madrid	100	-	100		602	100	60	1,663	5	1,729	1,729	60	60,595	58,867
Bankinter Capital Riesgo I Fondo Capital	V84161538	Paseo de la Castellana, 29 28046 Madrid	100	-	100		30,000	1,000	30,000	4,610	630	35,241	33,666	30,000	34,213	547
Arroyo Business Consulting Development, S.L.	B84428945	Calle Marqués de Riscal 13. 28010 Madrid	99.99	0.01	100		2,976	1	3	(1)	(1)	2	2	6	2	-

				% holding							Summarised financial information
Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	% indirect holding of Bankinter	% total holding	Dividends paid	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
Gneis Global Services S.A.	A85982411	Calle Pico de San Pedro 2, 28760 Madrid	99.99	0.01	100		30,000,000	1	30,000	21,846	7,835	59,681	59,922	30,241	91,772	31,850
Relanza Gestión, S.A.	A85593770	Avda de Bruselas 12, Alcobendas. 28018 Madrid	0.01	99.99	100		1,000	60	60	154	33	247	247	60	314	67
Línea Directa Aseguradora, S.A., Compañía de Seguros y Reaseguros	A80871031	Av Europa 7,28760 Tres Cantos, Madrid	100	-	100	290,122	2,400,000	16	37,512	107,830	98,493	243,835	243,835	334,149	1,252,658	953,127
Línea Directa Asistencia, S.L.U.	B80136922	CM CERRO DE LOS GAMOS 1, 28224 Pozuelo de Alarcón, Madrid	-	100	100		500	60	30	10,343	6,518	16,891	16,891	418	28,812	11,921
LD ACTIVOS, S.L.U.	B86322880	Rd Europa 7,28760 Tres Cantos, Madrid	-	100	100		3,003,000	1	35,633	244	841	36,718	36,718	35,633	56,750	20,032
Moto Club LDA, S.L.U.	B83868083	Calle Isaac Newton 7, 28760 Tres Cantos, Madrid	-	100	100		30	100	3	458	133	594	594	3	666	72
Centro Avanzado de Reparaciones CAR, S.L.U.	B84811553	Av Sol 5, 28850 Torrejón de Ardoz, Madrid	-	100	100		10,000	60	600	345	301	1,246	1,246	2,103	2,517	1,271
Ambar Medline, S.L.	B85658573	Av Europa 7,28760 Tres Cantos, Madrid	-	100	100		100,310	10	1,003	44	(1)	1,046	1,046	1,003	1,804	758
Mercavalor, S.V., S.A.	A-79203568	Marqués de Riscal, 11, 28010 Madrid	99.99	0.01	100		4,285	601	2,576	2,242	2,949	7,767	7,774	2,127	12,561	4,787
BANKINTER LUXEMBOURG, S.A.	LU001623854	37, Avenue J. F. Kennedy, L-1855 Luxembourg	99.99	0.01	100		25,000	870	21,750	8,489	(2,275)	27,964	28,688	34,598	186,625	157,936

Group companies accounted for using the equity method as at 31 December 2014 and 2013 were; Helena Activos Líquidos, S.L., Eurobits Technologies, S.L., Bankinter Seguros de Vida, S.A. de Seguros y Reaseguros and Bankinter Seguros Generales, S.A. de Seguros y Reaseguros. These companies are accounted for using the equity method as opposed to proportional consolidation, in accordance with the accounting regulations in force, since as there is no joint management with the other shareholders, this method allows the economic basis of the relationship between the companies to be more accurately reflected. The following are their most significant data:

2014:

% holding				Summarised financial information
Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	% indirect holding of Bankinter	% total holding	Dividends paid	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
Helena Activos Líquidos, S.L.	B-84199173	Calle Serrano 41, 28001 Madrid	29.53	-	29.53		706,932	-	24	1,510	28	1,562	1,562	325	1,992	430
Eurobits Technologies, S.L.	B-83852160	Avda de Bruselas 7, Alcobendas. 28108 Madrid	71.98	-	71.98		4,606	1	9	1,121	77	1,207	1,207	202	1,894	687
Bankinter Seguros de Vida, S.A. de Seguros y Reaseguros	A-78510138	Avda de Bruselas 12, Alcobendas. 28018 Madrid	50	-	50	26,539	185,049	30	6,969	14,282	34,793	56,044	35,605	2,433	313,269	277,664
Bankinter Seguros Generales, S.A.de Seguros y Reaseguros	A-78510138	Paseo de la Castellana, 29 28046 Madrid	49.9	-	49.9		998	5,030	10,060	540	(461)	10,140	10,322	5,020	11,861	1,539

% holding Summarised financial information Name Tax Identification Code (CIF) Registered office % direct holding of Bankinter % indirect holding of Bankinter % total holding Dividends paid No. of shares Nominal value (euros) Capital Reserves Profit (loss) for the year Theoretical book value Equity Cost Assets Liabilities Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A. A78757143 Paseo de la Castellana, 29 28046 Madrid 99.99 0.01 ¹⁰⁰ 35,222 ³⁰ 1,060 28,928 ¹¹⁷ 30,106 30,106 28,060 30,830 ⁷²⁴ Bankinter Gestión de Activos, S.G.I.I.C. A78368909 Calle Marqués de Riscal 11. 28010 Madrid 99.99 0.01 100 21,026 144,599 30 4,345 17,170 16,783 38,299 28,307 4,518 43,712 15,405 Hispamarket, S.A. A28232056 Paseo de la Castellana, 29 28046 Madrid 99.99 0.01 ¹⁰⁰ 4,516,452 ⁶ 27,144 2,039 (2,164) 27,019 27,247 26,962 148,956 121,710 Intermobiliaria, S.A. A28420784 Paseo de la Castellana, 29 28046 Madrid 99.99 0.01 ¹⁰⁰ 243,546 ³⁰ 7,319 (202,874) (105,881) (301,436) (301,436) 42,497 504,357 805,793 Bankinter Consumer Finance, E.F.C., S.A. A82650672 Avda de Bruselas 12, Alcobendas. 28108 Madrid 99.99 0.01 100 21,575 1,299,999 30 39,065 33,867 23,706 96,638 86,138 60,002 345,185 259,047 Bankinter Capital Riesgo, SGECR, S.A. A83058214 Paseo de la Castellana, 29 28046 Madrid 96.77 3.23 ¹⁰⁰ 3,100 ^{100 310 552 186} 1,049 1,049 ²³⁹ 1,227 ¹⁷⁸ Bankinter Sociedad de Financiación, S.A.U. A84129378 Paseo de la Castellana, 29 28046 Madrid ¹⁰⁰ - ^{100 602 100 60} 1,639 ⁷¹⁶ 2,415 2,415 ⁶⁰ 5,181,470 5,179,055 Bankinter Emisiones, S.A.U. A84009083 Paseo de la Castellana, 29 28046 Madrid ¹⁰⁰ - ^{100 602 100 60} 1,663 - 1,723 1,723 ⁶⁰ 63,161 61,437 Bankinter Capital Riesgo I Fondo Capital V84161538 Paseo de la Castellana, 29 28046 Madrid ¹⁰⁰ - ¹⁰⁰ 30,000 1,000 30,000 3,299 1,312 34,610 30,239 30,000 32,031 1,793 Arroyo Business Consulting Development, S.L. B84428945 Calle Marqués de Riscal 13. 28010 Madrid 99.99 0.01 100 2,976 1 3 1 (2) 2 2 6 3 1

Details of fully consolidated Group companies as at 31 December 2013 are as follows:

				% holding							Summarised financial information
Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	% indirect holding of Bankinter	% total holding	Dividends paid	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
Gneis Global Services S.A.	A85982411	Calle Pico de San Pedro 2, 28760 Madrid	99.99	0.01	100	7,000	30,000,000	1	30,000	15,564	13,282	58,846	51,962	30,116	84,629	32,667
Relanza Gestión, S.A.	A85593770	Avda de Bruselas 12, Alcobendas. 28018 Madrid	0.01	99.99	100		1,000	60	60	124	30	214	214	60	267	52
Línea Directa Aseguradora, S.A., Compañía de Seguros y Reaseguros	A80871031	Av Europa 7,28760 Tres Cantos, Madrid	100	-	100	60,000	2,400,000	16	37,512	356,159	101,792	495,463	457,986	372,061	1,270,647	812,661
Línea Directa Asistencia, S.L.U.	B80136922	CM CERRO DE LOS GAMOS 1, 28224 Pozuelo de Alarcón, Madrid	-	100	100		500	60	30	13,434	8,909	22,373	22,373	418	36,214	13,841
LD ACTIVOS, S.L.U.	B86322880	Rd Europa 7,28760 Tres Cantos, Madrid	-	100	100		3,003,000	1	3,003	12,820	53	15,876	15,877	8,133	16,246	369
Moto Club LDA, S.L.U.	B83868083	Calle Isaac Newton 7, 28760 Tres Cantos, Madrid	-	100	100		30	100	3	274	184	461	461	3	633	172
Centro Avanzado de Reparaciones CAR, S.L.U.	B84811553	Av Sol 5, 28850 Torrejón de Ardoz, Madrid	-	100	100		10,000	60	600	(59)	404	945	945	2,103	2,461	1,516
Ambar Medline, S.L.	B85658573	Av Europa 7,28760 Tres Cantos, Madrid	-	100	100		100,310	10	1,003	30	14	1,047	1,047	1,003	2,052	1,005
Mercavalor, S.V., S.A.	A-79203568	Marqués de Riscal, 11, 28010 Madrid	99.99	0.01	100	938	4,285	601	2,576	2,505	(264)	4,817	4,817	2,120	6,568	1,751
BANKINTER LUXEMBOURG, S.A.	LU001623854	37, Avenue J. F. Kennedy, L-1855 Luxembourg	99.99	0.01	100		10,000	870	8,700	9,567	(1,081)	17,186	17,186	21,548	86,455	69,269

Group companies accounted for using the equity method as at 31 December 2013, together with their most significant data, were as follows:

	% holding					Summarised financial information
Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	% indirect holding of Bankinter	% total holding	Dividends paid	No. of shares	Nominal value (euros)		Capital Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
Helena Activos Líquidos, S.L.	B-84199173	Calle Serrano 41, 28001 Madrid	29.53	-	29.53		706,932	-	24	1,761	(189)	1,596	1,596	325	1,732	136
Eurobits Technologies, S.L.	B-83852160	Avda de Bruselas 7, Alcobendas. 28108 Madrid	32.01	-	32.01		2,845	1	9	1,119	214	1,342	1,342	162	1,991	649
Bankinter Seguros de Vida, S.A. de Seguros y Reaseguros	A-78510138	Avda de Bruselas 12, Alcobendas. 28018 Madrid	50	-	50	16,067	185,049	30	6,969	30,793	32,407	70,169	48,102	2,433	414,164	366,062
Bankinter Seguros Generales, S.A.de Seguros y Reaseguros	A-78510138	Paseo de la Castellana, 29 28046 Madrid	49.9	-	49.9		998	5,030	10,060	464	73	10,597	10,597	5,020	10,651	54

During 2013 the Group added the following companies to its consolidation scope:

Company	% control of the Group	Activity
Mercavalor, S.V., S.A.	100%	Sociedad de Valores
Bankinter Luxembourg, S.A.	100%	Private Banking
Naviera Goya S.L.	100%	Special purpose vehicle
Naviera Sorolla, S.L.	100%	Special purpose vehicle
Castellana Finance Limited	100%	Special purpose vehicle

Naviera Goya, S.L. and Naviera Sorolla, S.L. are special purpose vehicles established to support the financing of shipbuilding by Spanish shipyards.

The following is a detailed breakdown of the activities of the group companies, joint ventures and associates:

	Activity
Group companies
Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A.	Telephone helpline
Bankinter Gestión de Activos, S.G.I.I.C.	Asset management
Hispamarket, S.A.	Holding and acquisition of securities
Intermobiliaria, S.A.	Property management
Bankinter Consumer Finance, E.F.C.,S.A.	Finance company
Bankinter Capital Riesgo, SGECR, S.A.	Fund management and private equity companies
Bankinter Sociedad de Financiación, S.A.	Issue of debt securities
Bankinter Emisiones, S.A.	Issue of preferred shares
Bankinter Capital Riesgo I Fondo Capital	Private equity fund
Arroyo Business Consulting Development, S.L.	Inactive
Gneis Global Services S.A.	Consultancy
Relanza Gestión, S.A.	Collection and recovery services
Línea Directa Aseguradora, S.A., Compañía de Seguros y Reaseguros	Insurance company
Línea Directa Asistencia, S.L.U.	Insurance assessments, vehicle inspections and travel assistance
Moto Club LDA, S.L.U.	Services to motorcycle users
Centro Avanzado de Reparaciones CAR, S.L.U.	Vehicle repair
Ambar Medline, S.L.	Insurance mediation
Línea Directa Activos, S.L.	Property management
Naviera Soroya, S.L.	Special purpose vehicle
Naviera Goya, S.L.	Special purpose vehicle
Castellana Finance Limited	Special purpose vehicle
Bankinter Luxembourg	Private Banking
Mercavalor, S.V., S.A.	Securities broker
Joint arrangements and associates:
Helena Activos Líquidos, S.L.	Other financial services
Eurobits Technologies, S.L.	Advanced digital services
Bankinter Seguros de Vida, S.A. de Seguros y Reaseguros	Insurance company
Bankinter Seguros Generales, S.A.de Seguros y Reaseguros	Insurance company

Apart from this, the Group has structured the entities shown hereunder with an indication as to whether or not they are consolidated.

2014:

A) Non-consolidated structured entities

Name	Tax Identification Code (CIF)	Registered office	Activity	Date originated	Total securitised exposures at origination date	Total securitised exposures at 31-12-2014
Bankinter 2 Mortgage Securitisation Fund	V82463423	Calle Lagasca 120, 28006 Madrid	Financial services	25-10-1999	320,000	22,883
Bankinter 3 Mortgage Securitisation Fund	V83123406	Calle Lagasca 120, 28006 Madrid	Financial services	22-10-2001	1,322,500	164,308
Bankinter 4 Mortgage Securitisation Fund	V83419192	Calle Lagasca 120, 28006 Madrid	Financial services	24-09-2002	1,025,000	181,917
Bankinter 5 Mortgage Securitisation Fund	V83501460	Calle Lagasca 120, 28006 Madrid	Financial services	16-12-2002	710,000	131,505
Bankinter 6 Mortgage Securitisation Fund	V83756114	Calle Lagasca 120, 28006 Madrid	Financial services	25-09-2003	1,350,000	334,310

Financial year 2013

Name	Tax Identification Code (CIF)	Registered office	Activity	Date originated	Total securitised exposures at origination date	Total securitised exposures at 31-12-2013
Bankinter 2 Mortgage Securitisation Fund	V82463423	Calle Lagasca 120, 28006 Madrid	Financial services	25-10-1999	320,000	27,633
Bankinter 3 Mortgage Securitisation Fund	V83123406	Calle Lagasca 120, 28006 Madrid	Financial services	22-10-2001	1,322,500	194,304
Bankinter 4 Mortgage Securitisation Fund	V83419192	Calle Lagasca 120, 28006 Madrid	Financial services	24-09-2002	1,025,000	210,598
Bankinter 5 Mortgage Securitisation Fund	V83501460	Calle Lagasca 120, 28006 Madrid	Financial services	16-12-2002	710,000	150,152
Bankinter 6 Mortgage Securitisation Fund	V83756114	Calle Lagasca 120, 28006 Madrid	Financial services	25-09-2003	1,350,000	378,137

Neither in 2014 nor in 2013 was there any contractual agreement whereby the parent company or its subsidiaries had provided or were obliged to provide financial support or sponsorship to these unconsolidated structured entities.

B) Consolidated structured entities

	2014:

Name	Tax Identification Code (CIF)	Registered office	Activity	total % control	Date originated	Total securitised exposures at origination date	Total securitised exposures at 31-12-2014
Bankinter 7 Mortgage Securitisation Fund	V-83905075	Calle Lagasca 120, 28006 Madrid	Financial services	100	18-02-2004	490,000	123,302
Bankinter 8 Asset Securitisation Fund	V-83923425	Calle Lagasca 120, 28006 Madrid	Financial services	100	03-03-2004	1,070,000	271,875
Bankinter 9 Asset Securitisation Fund	V-84246099	Calle Lagasca 120, 28006 Madrid	Financial services	100	14-02-2005	1,035,000	351,420
Bankinter 10 Asset Securitisation Fund	V-84388115	Calle Lagasca 120, 28006 Madrid	Financial services	100	27-06-2005	1,740,000	615,708
Bankinter 11 Mortgage Securitisation Fund	V-84520899	Calle Lagasca 120, 28006 Madrid	Financial services	100	28-11-2005	900,000	371,215
Bankinter 2 SME Asset Securitisation Fund	V84892272	Calle Lagasca 120, 28006 Madrid	Financial services	100	26-06-2006	800,000	133,530
Bankinter 13 Asset Securitisation Fund	V84752872	Calle Lagasca 120, 28006 Madrid	Financial services	100	20-11-2006	1,570,000	765,674
Bankinter 3 FT SME Asset Securitisation Fund	V85264117	Calle Lagasca 120, 28006 Madrid	Financial services	100	12-11-2007	617,400	175,681
Bankinter 4 FT SME Asset Securitisation Fund	V85524791	Calle Lagasca 120, 28006 Madrid	Financial services	100	15-09-2008	400,000	135,881

Other structures. Summarised financial information

Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
NAVIERA SOROYA, S.L.	B86728185	Paseo de la Castellana, 29 28046 Madrid	100	3,000	1	3	-	2	3	3	3	13	10
NAVIERA GOYA, S.L.	B86728193	Paseo de la Castellana, 29 28046 Madrid	100	3,000	1	3	-	2	3	3	3	179,713	179,710
CASTELLANA FINANCE	909654647G	25 North Wall Quay, 28001 Dublin	100	-	-	-	-	-	-	-	-	124,786	124,786

2013:

Name	Tax Identification Code (CIF)	Registered office	Activity	total % control	Date originated	Total securitised exposures at origination date	Total securitised exposures at 31/12/2013
Bankinter 7 Mortgage Securitisation Fund	V-83905075	Calle Lagasca 120, 28006 Madrid	Financial services	100	18-02-2004	490,000	138,384
Bankinter 8 Asset Securitisation Fund	V-83923425	Calle Lagasca 120, 28006 Madrid	Financial services	100	03-03-2004	1,070,000	304,377
Bankinter 9 Asset Securitisation Fund	V-84246099	Calle Lagasca 120, 28006 Madrid	Financial services	100	14-02-2005	1,035,000	388,709
Bankinter 10 Asset Securitisation Fund	V-84388115	Calle Lagasca 120, 28006 Madrid	Financial services	100	27-06-2005	1,740,000	677,825
Bankinter 11 Mortgage Securitisation Fund	V-84520899	Calle Lagasca 120, 28006 Madrid	Financial services	100	28-11-2005	900,000	409,087
Bankinter 2 SME Asset Securitisation Fund	V84892272	Calle Lagasca 120, 28006 Madrid	Financial services	100	26-06-2006	800,000	165,139
Bankinter 13 Asset Securitisation Fund	V84752872	Calle Lagasca 120, 28006 Madrid	Financial services	100	20-11-2006	1,570,000	831,214
Bankinter 3 FT SME Asset Securitisation Fund	V85264117	Calle Lagasca 120, 28006 Madrid	Financial services	100	12-11-2007	617,400	212,529
Bankinter 4 FT SME Asset Securitisation Fund	V85524791	Calle Lagasca 120, 28006 Madrid	Financial services	100	15-09-2008	400,000	163,221

Other Structures. Summarised financial information

Name	Tax Identification Code (CIF)	Registered office	% direct holding of Bankinter	No. of shares	Nominal value (euros)	Capital	Reserves	Profit (loss) for the year	Theoretical book value	Equity	Cost	Assets	Liabilities
NAVIERA SOROYA, S.L.	B86728185	Paseo de la Castellana, 29 28046 Madrid	100	3,000	1	3	-	(2)	3	1	3	3	2
NAVIERA GOYA, S.L.	B86728193	Paseo de la Castellana, 29 28046 Madrid	100	3,000	1	3	-	(2)	3	1	3	48,519	48,518
CASTELLANA FINANCE	909654647G	25 North Wall Quay, 28001 Dublin	100	-	-	-	-	-	-	-	-	127,814	127,814

Neither in 2014 nor in 2013 was any contractual agreement in place whereby the parent company or its subsidiaries had provided or were obliged to provide financial support or sponsorship to these unconsolidated structured entities.

C) Investment funds, SICAVs and Pension Funds managed by the Group.

2014:

	Total Assets	Total equity
Pension funds	1,939,990	1,936,084
Guaranteed fixed income	224,439	224,123
guaranteed equities	685,771	684,511
Overall	219,410	218,625
Money market funds	126,661	126,349
Fixed Income, long-term	236,219	235,777
Equities, euros	206,187	205,872
Mixed equities, euros	241,303	240,830
Real estate investment funds	7,259,337	7,233,279
with partial guarantee	17,670	17,648
Guaranteed fixed income	2,230,273	2,228,162
Guaranteed equities	1,122,554	1,103,065
Money market funds	100,757	100,664
Fixed Income, long-term	1,818,355	1,816,195
International mixed fixed income	60,857	60,775
Equities, euros	1,645,548	1,643,808
Mixed equities, euros	162,452	162,225
Absolute return	100,871	100,734
SICAVs	2,459,761	2,398,565
Overall	2,459,761	2,398,565
Grand total	11,659,088	11,567,925

2013:

	Total Assets	Total equity
Pension funds	1,653,911	1,650,496
Guaranteed fixed income	402,575	401,820
Guaranteed equities	14,901	14,864
Mixed fixed income	63,305	63,210
Mixed equities	108,424	108,201
Fixed Income, short term	374,767	374,028
Fixed Income, long term	242,843	242,184
Equities	447,096	446,189
Real estate investment funds	6,011,665	5,998,750
Guaranteed fixed income	1,177,239	1,175,635
Guaranteed equities	397,636	390,539
Overall	10,300	10,266
Passive management	1,678	1,674
Mixed fixed income	55,525	55,454
Money market funds	1,799,105	1,798,137
Fixed Income, long-term	290,419	290,018
Fixed Income, short-term	1,304,066	1,303,125
International mixed fixed income	35,515	35,465
Equities, international	159,946	159,431
Equities, euros	556,846	556,013
Equities, international	100,656	100,487
Mixed equities, euros	63,539	63,445
International mixed equities	30,677	30,640
Absolute return	28,518	28,421
SICAVs	1,758,758	1,728,471
Overall	1,758,758	1,728,471
Grand total	9,424,334	9,377,717

14. Tangible assets

The breakdown of this heading in the balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
For internal use	388,181	394,933
Real estate investments	54,524	13,044
Other assets assigned under operating leases	24,657	26,954
	467,362	434,931

The following is a summary of the elements of the tangible assets and their movements during financial years 2014 and 2013:

			Euros
2014	Opening balance	Additions	Derecognition and other	Year-end Balance
Cost:	843,512	83,976	34,628	892,861
Fixtures and fittings	322,525	20,958	5,069	338,414
Data processing equipment	119,514	4,798	11,177	113,135
a) Other property, plant and equipment	387,677	16,354	18,382	385,649
Investment property	13,796	41,867	-	55,663
Depreciation and Amortisation	407,593	32,345	15,428	424,510
Fixtures and fittings	218,992	21,321	1,397	238,916
Data processing equipment	111,722	2,152	10,937	102,937
a) Other property, plant and equipment	76,556	8,485	3,093	81,948
Investment property	322	387		709
Impairment (*):	988	-	-	988
Fixtures and fittings	-			-
Data processing equipment
a) Other property, plant and equipment	558			558
Investment property	430		-	430
Net:	434,931	51,631	19,200	467,363
Fixtures and fittings	103,533	(363)	3,672	99,498
Data processing equipment	7,792	2,646	240	10,197
a) Other property, plant and equipment	310,562	7,869	15,288	303,143
Investment property	13,044	41,480	-	54,524
	434,931	51,631	19,200	467,363

2013			Euros
	Opening balance	Additions	Derecognition and other	Year-end Balance
Cost:	820,919	29,878	7,285	843,512
Fixtures and fittings	310,343	12,552	370	322,525
Data processing equipment	119,919	4,270	4,675	119,514
a) Other property, plant and equipment	381,522	6,155	-	387,677
Investment property	9,134	6,902	2,240	13,796
Depreciation and Amortisation	378,204	33,496	4,107	407,593
Fixtures and fittings	198,203	20,815	26	218,992
Data processing equipment	112,042	3,696	4,016	111,722
a) Other property, plant and equipment	67,776	8,780	-	76,556
Investment property	182	205	65	322
Impairment (*):	426	562	-	988
Fixtures and fittings	-			-
Data processing equipment
a) Other property, plant and equipment	426	132		558
Investment property	-	430	-	430
Net:	442,288	-4,179	3,178	434,931
Fixtures and fittings	112,140	(8,263)	343	103,533
Data processing equipment	7,877	574	659	7,792
a) Other property, plant and equipment	313,320	(2,757)	-	310,562
Investment property	8,952	6,267	2,175	13,044
	442,288	(4,179)	3,178	434,931

Fully depreciated property, plant and equipment held for the Bank's own use and still in use as at 31 December 2014 amounted to €140.15 million (€97.35 million as at 31 December 2013).

The breakdown by asset type of the gains and losses recognised in 2014 and 2013 on sales of investment property and other items is as follows (Note 35):

	€000s
	2014 2013
	Gains Losses Gains Losses
Sale of investment property and other
items	21	2,570	9	1,878
	21	2,570	9	1,878

Note 43 "Fair value of assets and liabilities" states the fair value of the main items of property, plant and equipment, and the method used to calculate them.

As at 31 December 2014 and 2013, the Bank had no tangible assets for its own use or under construction that were subject to any ownership restrictions or had been given as collateral in cover of debts. Neither are there any commitments to third parties on those dates for the acquisition of tangible assets. During said financial years, the Bank did not receive or expect to receive any amounts from third parties as compensation or indemnity for the impairment or loss of value of tangible assets for its own use.

The whole of the Bank's tangible assets for internal use as at 31 December 2014 and 2013 was denominated in euros.

The balance of assets leased out under operating leases and included under this heading in the balance sheet as at 31 December 2014 was €24.66 million (€26.95 million at 31 December 2013).

15. Intangible assets

The following is a breakdown of this item on the consolidated balance sheet and of its movements during financial years 2014 and 2013:

2014	€000s
	Opening balance	Additions	Derecognition and other	Year-end Balance
Cost:	411,838	13,275	3,802	421,311
Goodwill	164,281	-	-	164,281
Intangible	244,594	10,225	3,802	251,017
Software in progress	2,963	3,050	-	6,013
Depreciation and Amortisation	111,135	31,428	3,747	138,816
Goodwill	-	-	-	-
Intangible	111,135	31,428	3,747	138,816
Software in progress	-	-	-	-
Impairment:	-	168	-	168
Goodwill	-	168	-	168
Intangible	-	-	-	-
Software in progress	-	-	-	-
Net:	300,703	(18,321)	56	282,327
Goodwill	164,281	(168)	-	164,113
Intangible	133,459	(21,203)	56	112,201
Software in progress	2,963	3,050	-	6,013

2013		€000s
	Opening balance	Additions	Derecognition and other	Year-end Balance
Cost:	399,080	12,759	-	411,838
Goodwill	161,836	2,445	-	164,281
Intangible	235,819	8,776	-	244,594
Software in progress	1,425	1,538	-	2,963
Depreciation and Amortisation	81,543	29,592	-	111,135
Goodwill	-	-	-	-
Intangible	81,543	29,592	-	111,135
Software in progress	-	-	-	-
Impairment:	-	-	-	-
Goodwill	-	-	-	-
Intangible	-	-	-	-
Software in progress	-	-	-	-
Net:	317,537	(16,834)	-	300,703
Goodwill	161,836	2,445	-	164,281
Intangible	154,276	(20,817)	-	133,459
Software in progress	1,425	1,538	-	2,963

The acquisition during financial year 2009 of 50% of the share capital of Línea Directa Aseguradora, S.A., Compañía de Seguros y Reaseguros ("LDA") led to the recognition of goodwill amounting to €161.84 million and Other Intangible Assets amounting to €221.93 million. During 2013, the acquisition of Bankinter Luxembourg S.A. involved the recognition of goodwill for €2.45 million.

In this regard, the entity subjects the goodwill recognised on the acquisition of 100% of LDA to the annual impairment analysis established in the accounting standards. This analysis is based on the impairment of the cash-generating unit to which this goodwill has been allocated; in this case LDA. This unit would be impaired if its carrying amount were more than the present value of its estimated future cash flows. This circumstance has not arisen in the last two financial years.

The estimated cash flows are taken from LDA's business plan in its most prudent scenario, with moderate growth rates and excluding the positive net flows that might be derived from structural changes in the business or in its efficiency, in accordance with best practices. Specifically, projected cash flows are based on the assumption that forecasts for next year's profits will be achieved. For the remaining years the trend in cash flows has been estimated as the lower of the company's most recent forecasts and the objective inflation of the economic environment in which it conducts its business, namely 2%. Both past experience and forecasts are in excess of this 2%. The period used for this estimate is five financial years, and the growth rate in perpetuity is equal to target inflation, 2%.

The discount rate applied to the projected cash flows is 10% (after tax), this being the internal cost of capital. This estimated cost of capital is in line with those applied by independent analysts in the sector. Also, 10% is the discount rate commonly used for this kind of analysis in the insurance sector in which LDA conducts its business.

A similar procedure is applied to the goodwill arising on the acquisition of Bankinter Luxembourg S.A.

The only impairment deriving from the impairment tests carried out in 2014 and 2013 on goodwill recognised in the balance sheet was an impairment of €0.17 million in 2014 of the goodwill arising on the acquisition of Bankinter Luxembourg, S.A.

Other Intangible Assets generated by the acquisition of 50% of LDA essentially relate to the valuation of customer relationships at the time of the acquisition. Amortisation is linear over a period of 10 years from the date of acquisition, which is the estimated useful life of this asset. In the financial year 2014, amortisation of these assets totalled €22.19 million (€22.19 million in 2013). As at 31 December 2013 and 2014, this intangible asset did not show any sign of impairment.

Capitalisation of IT developments is the other main source of new intangible assets. During 2014 the Group capitalised €3.78 million in respect of Gneis S.A. (€8.81 million in 2013).

As at 31 December 2014 and 2013 the Group reviewed the useful lives of its intangible assets, no changes resulting.

As well as the impairment tests on the goodwill recognised in the balance sheet, the Bank also carries out a sensitivity analysis with a view to determining whether a reasonably possible change in a key assumption on the calculation of the recoverable amount of a CGU would lead to the carrying amount exceeding the recoverable amount. This sensitivity analysis was carried out for 2014 and 2013 and did not conclude that a reasonably possible change in a key assumption would lead to a significant change in the conclusions relating to the impairment of goodwill recognised in the balance sheet.

16. Reinsurance assets

As at 31 December 2014, the balance of the item "Insurance contract assets" contains the assets recognised by Línea Directa Aseguradora, S.A., Compañía de Seguros y Reaseguros in the course of its activity.

Movement in 2014 and 2013 in Reinsurance Assets was as follows:

	€000s
	Provision for Unearned Premium	Provision for Claims	Total
Balance as at 31-12-2013	489	2,755	3,244
Additions	425	3,088	3,513
Applications	(489)	(2,755)	(3,244)
Adjustments and settlements		(507)	(507)
Balances as at 31 December 2014	425	2,581	3,006

The reinsurance scheme followed by the Company is mostly based on an Excess Loss (XL) structure, with the aim of obtaining protection against serious or peak losses and events caused by natural events not covered by the Insurance Compensation Consortium, using reinsurance as a stabilising element for these kinds of losses which are random in both occurrence and amount.

Reinsurers must be registered with the CNSF (National Financial Services Commission) and comply with strict prudential requirements; they must also have excellent ratings proving their financial solvency. Foreign companies have to present a certificate of residence in Spain.

The criterion used to establish the reinsurance framework stipulates that reinsurers' rating must not be lower than A. However, a deposit clause will be included in the contracts of reinsurers with S&P ratings of AA- and below. Lastly, any exceptions must be approved by the Board of Directors.

There is quarterly control over the ratings of the various companies that make up the reinsurance panel, with monitoring of the credit risk ratings published by Standard & Poor's, Moody's and Fitch, meaning that changes in the probability of default on the commitments undertaken are subject to control.

17. Tax assets and liabilities

The breakdown of these items in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
		Current		Deferred
	31/12/2014	31/12/2013	31/12/2014	31/12/2013
Retentions and payments on account	6,743	7,984	-	-
Income tax	137,484	65,283	143,878	132,300
VAT	6,775	10,378	-	-
Other	3,292	-	-	-
Tax assets	154,294	83,645	143,878	132,300
Retentions and payments on account	5,245	4,005
Income tax	116,378	48,882	177,362	149,647
VAT	8,076	10,022
Other items	5,354	5,208
Tax liabilities	135,054	68,119	177,362	149,647

The amounts shown in the foregoing table corresponding to 2013 are those presented in the annual report for 2013. If they had been adjusted for the change in accounting principle indicated in Note (2), the amount of the tax assets would have been €105.65 million.

The movements in assets and liabilities due to deferred taxes during financial years 2014 and 2013, are as follows:

	€000s
	Deferred Taxes
	Assets Liabilities
Balance at 31/12/2012	148,536	147,929
Additions	12,935	10,240
Cancellations	29,171 8,522
Balance at 31/12/2013	132,300 149,647
Additions	47,340	31,196
Cancellations	35,762 3,481
Balance at 31/12/2014	143,878 177,362

The reconciliation of the movements in deferred taxes during 2014 and 2013 is as follows:

	€000s
	31/12/2013	Charged/credited through profit or loss	Charged to Equity	31/12/2014
Deferred tax assets	132,300	13,160	(1,582)	143,878
Deferred tax liabilities	149,647	(5,906)	33,621	177,362

Charges and credits to profit and loss for deferred taxes, €19.07 million (€1.47 million in 2013) include expense in respect of deferred taxes corresponding to 30% of the temporary differences of 2014 (€20.08 million). The remainder of the amount corresponds to charges/credits recognised in profit and loss for 2014 as a result of the definitive recognition of corporate income tax for the year before, as well as other charges/credits in respect of deferred taxes not necessarily corresponding to temporary differences.

Charges/credits in respect of deferred taxes recognised in equity (-€35.20 million) agree with the amount shown against Tax on Income in the consolidated statement of comprehensive income for 2014.

The reconciliation of the movements in deferred taxes during 2013 is as follows:

	€000s
	31/12/2012	Charged/credited through profit or loss	Charged/credited in equity	31/12/2013
Deferred tax assets	148,536	(14,775)	(1,461)	132,300
Deferred tax liabilities	147,929	(13,301)	15,019	149,647

The details of deferred tax assets and liabilities are as follows:

	€000s
	31/12/2014	31/12/2013
Deferred tax assets (Note 17)	143,878	132,300
Less than 10 years:
Impairment of property assets	56,535	64,665
Provisions for real estate promoter risk	-	-
Other provisions and accruals	72,593	53,816
Impairment in holdings	6,023	2,740
Early retirement fund	-	212
Software	46	43
Loan fees	1,562	1,858
Other	7,502	5,408
Available-for-Sale Portfolio	180	2,235
Consolidation adjustments	(563)	1,323
Deferred tax liabilities (Note 17)-	177,362	149,647
Less than 10 years
Available-for-Sale Portfolio	53,703	20,555
Intra-group sales	10,107	12,525
Other	23,615	22,080
Consolidation adjustments	41,668	45,404
Of which:
Revaluation of Assets of Línea Directa Aseguradora, S.A.	33,406	40,167
More than 10 years:
Revaluation of buildings	48,269	49,083

Royal Decree Law 14/2013 of 29 November concerning urgent measures for adapting Spanish law to that of the European Union in the field of supervision and solvency of financial institutions adds a twenty-second additional provision to the Consolidated Text of the Corporation Tax Act, establishing the conversion of certain deferred tax assets into claims on the tax authorities. The Group estimates that approximately €86.42 million of deferred tax assets will be eligible for conversion (€89.20 million in 2013).

The Group has carried out an analysis of its ability to recover the deferred tax assets recognised as at 31 December 2014, the results of which support their recoverability before the legal statute of limitations is applicable.

18. Other assets and other liabilities

The breakdown of these items in the consolidated balance sheet as at 31 December 2014 and 2013 is as follows:

	€000s
	Assets		Liabilities
	31/12/2014	31/12/2013	31/12/2014	31/12/2013
Accrued expenses and deferred income	126,034	110,328	113,430	99,897
Operations in progress	760	963	68,923	27,321
Other items	19,891	16,377	39,333	35,526
	146,685	127,668	221,686	162,744
In euros	145,102	127,584	221,682	162,741
In foreign currency	1,583	84	4	3
	146,685	127,668	221,686	162,744

The heading "Other items" in liabilities includes sundry payables and provisions for expenses.

19. Financial liabilities at amortised cost

The breakdown of these items of the consolidated balance sheets as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Deposits from central banks	3,240,433	3,243,794
Deposits from credit institutions	5,249,425	4,587,188
Customer deposits	29,966,129	29,624,282
Marketable debt securities	9,311,034	9,516,372
Subordinated liabilities	608,198	612,438
Other financial liabilities	1,615,461	1,402,011
	49,990,680	48,986,085
In euros	49,053,976	48,501,960
In foreign currency	936,704	484,125
	49,990,680	48,986,085

The breakdown of the 'Valuation adjustments' in the portfolio of financial liabilities at amortised cost as at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Accrued interest-	167,830	294,188
Deposits at central banks	24,833	43,794
Deposits with credit institutions	9,730	12,526
Customer deposits	82,000	156,936
Marketable debt securities	41,476	71,851
Subordinated liabilities	9,791	9,081
Micro-hedging operations	127,506	84,209
Other	(5,051)	(11,591)
	290,285	366,806

Note 45 "Risk-management policies" includes the breakdowns of the maturity dates and interest-rate review terms for the items making up financial liabilities at amortised cost.

Note 44 "Fair value of assets and liabilities" states the fair value by instrument type of financial liabilities at amortised cost and the methodology used for their calculation.

a) Deposits from central banks

The composition of "Financial liabilities at amortised cost" in the consolidated balance sheet was as follows as at 31 December 2014 and 2013:

	€000s
	31/12/2014	31/12/2013
Central Banks	3,215,600	3,200,000
Valuation adjustments	24,833	43,794
Accrued interest	24,833	43,794
	3,240,433	3,243,794

b) Deposits from credit institutions

The composition of "Financial liabilities at amortised cost" in the consolidated balance sheet was as follows as at 31 December 2014 and 2013:

	€000s
	31/12/2014	31/12/2013
Term accounts	1,463,863	1,559,511
Temporary assignment of assets	3,636,851	2,937,500
Other accounts	138,999	77,651
Valuation gains/(losses)-	9,712	12,526
Accrued interest	9,712	12,526
	5,249,425	4,587,188
In euros	5,179,369	4,579,547
In foreign currency	70,056	7,641
	5,249,425	4,587,188

c) Customer deposits

The composition of "Financial liabilities at amortised cost" in the consolidated balance sheet was as follows as at 31 December 2014 and 2013:

	€000s
	31/12/2014	31/12/2013
Public Administrations	478,576	2,637,924
Deposits received	476,702	2,635,575
Valuation adjustments	1,874	2,349
Accrued interest	1,874	2,349
Other private sectors	29,487,553	26,986,358
Sight deposits	15,084,805	12,098,651
Term deposits	10,294,690	11,245,992
Temporary assignment of assets	4,026,699	3,485,716
Valuation gains/(losses)-	81,359	155,999
Accrued interest	80,126	154,587
Micro-hedging operations	1,233	1,412
	29,966,129	29,624,282
In euros	29,002,678	29,002,370
In foreign currency	841,451	621,912
	29,966,129	29,624,282

d) Marketable debt securities

The composition of "Financial liabilities at amortised cost" in the consolidated balance sheet was as follows as at 31 December 2014 and 2013:

	€000s
	31/12/2014	31/12/2013
Promissory notes and bills of exchange	915,813	789,378
Mortgage-backed securities	9,336,530	11,194,047
Other securities linked to transferred financial assets	2,151,855	2,593,686
Treasury stock	(5,021,143)	(5,811,056)
Hybrid securities	1,154,566	482,373
Other non-convertible securities	677,780	179,840
Valuation adjustments	95,633	88,103
Accrued interest	41,476	71,851
Micro-hedging operations	58,950	27,594
Other	(4,793)	(11,341)
	9,311,034	9,516,372
In euros	9,302,980	8,724,123
In foreign currency	8,054	792,249
	9,311,034	9,516,372

"Own securities" at 31 December 2014 included mortgage bonds for €5.01 billion (€5.79 billion at 31 December 2013).

Promissory notes and bills of exchange

As a consequence of the planning required to manage the Bank's capital and liquidity, Bankinter, S.A. maintains diverse financing programmes and instruments on both the domestic market in Spain and international markets, to obtain financing or issue different kinds of securities, both short-term (promissory notes and euro commercial paper) and long-term (bonds, debentures and notes and mortgage bonds) under all kinds of debt arrangements (guaranteed, senior, subordinated, etc.)

The following is a breakdown of the issues of promissory notes in force as at 31 December 2014 and 2013, at their redemption value:

	€000s
	Outstanding balance at	Outstanding balance at
	31/12/2014	31/12/2013
Date of registration with the CNMV (Spain's securities regulator)
03/11/2011	-	19,206
08/11/2012	40,428	653,717
08/11/2013	597,524	158,837
08/11/2014	294,729	-
Commercial paper	932,681	831,760
Euro Commercial Paper	-	15,000
Interest accrued, not yet due	(16,868)	(26,913)
Total	915,813	819,847

The following is a breakdown of the mortgage bonds in circulation as at 31 December 2014 and 2013 (nominal values, €000s):

Issue	Nominal	(€000s) Type of Security	% Interest	Listed	Final maturity of the issue
Jul 2007		100,000 Mortgage bond	Eur3m + 0.217%	NO	Jul 2015
Dec 2007		100,000 Mortgage bond	Eur3m + 0.343%	NO	Dec 2015
Jun 08		200,000 Mortgage bond	Eur3m + 0.006%	NO	Jun 2016
Jul 10		200,000 Mortgage bond	EURIBOR 3m + 1.90%	YES	Jul 2018
Sept 11		750,000 Mortgage bond	Fixed rate 4.25%	YES	Mar 2015
Jan 12		300,000 Mortgage bond	Fixed rate 4.675%	YES	Jan 2016
Mar 2012		1,000,000 Mortgage bond	Fixed rate 4.125%	YES	Mar 2017
Oct 2012		500,000 Mortgage bond	Fixed rate 3.875%	YES	Oct 2015
Nov 2012		1,250,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2019
Nov 2012		600,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2017
Nov 2012		700,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2018
Jan 2013		200,000 Mortgage bond	Zero Coupon	YES	Jan 2016
Jan 2013		500,000 Mortgage bond	Fixed rate 2.75%	YES	Jul 2016
Feb 2013		200,000 Mortgage bond	EURIBOR 3m + 3.25%	YES	Feb 2021
Feb 2013		500,000 Mortgage bond	Fixed rate 3.125%	YES	Feb 2018
Apr 2013		90,000 Mortgage bond	Fixed rate 3.125%	YES	Feb 2018
May 2013		1,300,000 Mortgage bond	Eur3m + 2.50%	YES	May 2023
May 2013		500,000 Mortgage bond	Fixed rate 2.75%	YES	Jul 2016
Jan. 2014		200,000 Mortgage bond	Eur3m + 1.25%	YES	Jan. 2022
May 2014		200,000 Mortgage bond	Eur3m + 0.85%	YES	May 2022
	9,390,000
Interest
Discounted	(53,470)
up-front
Total	9,336,530

These issues are denominated in euros.

Interest accruing on these issues of commercial paper during 2014 amounted to €20.37 million (see Note 30) (€38.56 million in 2013).

Mortgage-backed securities, other non-convertible securities and hybrid securities

Mortgage-backed securities, other non-convertible securities, and hybrid liabilities state, as at 31 December 2014 and 2013, the outstanding volume for the issues of bonds, debentures, and mortgage bonds carried out by the Bank.

31/12/2013
Issue	Nominal (€000s)	Type of Security	% Interest	Listed	Final maturity of the issue
Jul 2007		100,000 Mortgage bond	Eur3m + 0.217%	NO	Jul 2015
Dec 2007		100,000 Mortgage bond	Eur3m + 0.343%	NO	Dec 2015
Jun 08		200,000 Mortgage bond	Eur3m + 0.006%	NO	Jun 2016
Nov 2009		1,000,000 Mortgage bond	Fixed rate 3.25%	YES	Nov 2014
Jul 10		200,000 Mortgage bond	EURIBOR 3m + 1.90%	YES	Jul 2018
Jan 11		20,000 Mortgage bond	Fixed rate 3.90%	YES	Jan. 2014
Mar 2011		400,000 Mortgage bond	Fixed rate 3.25%	YES	Nov 2014
Sept 11		900,000 Mortgage bond	Fixed rate 4.25%	YES	Mar 2015
Oct 11		10,000 Mortgage bond	Fixed rate 4.25%	YES	Jan. 2014
Jan 12		700,000 Mortgage bond	Fixed rate 4.675%	YES	Jan 2016
Jan 12		200,000 Mortgage bond	Eur3m + 3.50%	YES	Jan 2020
Mar 2012		1,000,000 Mortgage bond	Fixed rate 4.125%	YES	Mar 2017
Aug 2012		100,000 Mortgage bond	Eur3m + 4.90%	YES	Aug 2022
Oct 2012		500,000 Mortgage bond	Fixed rate 3.875%	YES	Oct 2015
Nov 2012		1,250,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2019
Nov 2012		600,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2017
Nov 2012		700,000 Mortgage bond	Eur3m + 4.00%	YES	Nov 2018
Jan 2013		200,000 Mortgage bond	Zero Coupon	YES	Jan 2016
Jan 2013		500,000 Mortgage bond	Fixed rate 2.75%	YES	Jul 2016
Feb 2013		200,000 Mortgage bond	EURIBOR 3m+3.25%	YES	Feb 2021
Feb 2013		500,000 Mortgage bond	Fixed rate 3.125%	YES	Feb 2018
Apr 2013		90,000 Mortgage bond	Fixed rate 3.125%	YES	Feb 2018
May 2013		1,300,000 Mortgage bond	Eur3m+2.50%	YES	May 2023
May 2013		500,000 Mortgage bond	Fixed rate 2.75%	YES	Jul 2016
	11,270,000
Interest Discounted up front	(75,953)
	11,194,047

The following is a breakdown of the issues of hybrid instruments (structured bonds) in circulation as at 31 December 2014 and 2013 by original term.

Total	1,154,568	482,374
5 years or more	1,055,758	436,781
4 years	12,598	6,600
3 years	39,124	25,080
2 years	32,488	6,813
1 year	14,600	7,100
Original Term	31-12-2014	31-12-2013

The following is a breakdown of the non-convertible bonds in circulation as at 31 December 2014 and 2013 (nominal values, €000s):

Issue	Nominal Value (€000s)	Type of Security		Listed	Final maturity of the issue
	Other non-convertible securities
Jun 2006	150,000	Bonds	Eur3m + 0.17%	YES	Jun 2016
Oct 10	30,000	Bonds	Fixed rate 4.27%	YES	Jul 2016
Jun 2014	500,000	Bonds	Fixed rate 1.75%	YES	June 2019
	680,000
Interest Discounted up-front	(2,220)
	677,780

			31-12-13
Issue	Nominal Value (€000s)		Type of % Interest Security		Final maturity of the issue
	Other non-convertible securities
Jun 2006	150,000	Bonds	Eur3m + 0.17%	YES	Jun 2016
Oct 10	30,000	Bonds	Fixed rate 4.27%	YES	Jul 2016
	180,000
Interest Discounted up-front	(160)
	179,840

All current issues are denominated in euros.

Interest accruing on issues of other non-convertible securities during 2014 amounted to €11.68 million (€19.52 million in 2013).

e) Subordinated liabilities

The composition of this heading in the portfolio of financial liabilities at amortised cost is as follows:

	€000s
	31/12/2014	31/12/2013
Marketable debt securities	473,020	487,626
Non-convertible (Subordinated bonds)	473,020	487,626
Preference shares	58,336	60,844
Valuation adjustments	76,842	63,968
Accrued interest	9,791	9,081
Micro-hedging operations	67,323	55,203
Other	(272)	(316)
	608,198	612,438
In euros	608,198	612,438
	608,198	612,438

Interest accrued on these bond issues during 2014 amounted to €28.15 million (€30.25 million in 2013). Interest paid on preferred shares recognised under the heading "Interest and similar charges" in the enclosed consolidated Income Statement (see Note 30), amounted to €2.45 million (€2.59 million in 2013).

Subordinated Debentures

The following is the breakdown as at 31 December 2014 and 2013 of subordinated debentures (nominal value, €000s):

Balance at 31 December 2014

		€ 000s		Maturity
	Issue	Nominal value	% Interest	Issue
III SUBORDINATED BONDS 1998	14/05/1998	81,893	Fixed rate 6.00%	18/12/2028
I SUBORDINATED BONDS March 2006	21/03/2006	17,300	Eur3m + 0.50%	21/03/2016
II SUBORDINATED BONDS June 2006	23/06/2006	31,900	Eur3m + 0.80%	23/06/2016
III SUBORDINATED BONDS December 2006	18/12/2006	21,900	Eur3m + 0.84%	18/12/2016
I SUBORDINATED D. March 2007	16/03/2007	4,700	Eur3m + 0.82%	16/03/2017
I SUBORDINATED BONDS September 2009	11/09/2009	250,000	Fixed rate 6.375%	11/09/2019
I SUBORDINATED BONDS July 2010	07/07/2010	40,000	Fixed rate 6.75%	07/12/2020
I SUBORDINATED BONDS February 2011	10/02/2011	47,250	Fixed rate 6.375%	11/09/2019
		494,943
Interest and other		(21,923)
		473,020

Balance as at 31 December 2013
	Issue	€ 000s Nominal value	% Interest	Maturity Issue
III SUBORDINATED BONDS 1998	14/05/1998	81,893	Fixed rate 6.00%	18/12/2028
I SUBORDINATED BONDS March 2006	21/03/2006	18,800	Eur3m + 0.50%	21/03/2016
II SUBORDINATED BONDS June 2006	23/06/2006	59,000	Eur3m + 0.80%	23/06/2016
III SUBORDINATED BONDS December 2006	18/12/2006	39,600	Eur3m + 0.84%	18/12/2016
I SUBORDINATED D. March 2007	16/03/2007	44,700	Eur3m + 0.82%	16/03/2017
I SUBORDINATED BONDS September 2009	11/09/2009	250,000	Fixed rate 6.375%	11/09/2019
I SUBORDINATED BONDS July 2010	07/07/2010	40,000	Fixed rate 6.75%	07/12/2020
I SUBORDINATED BONDS February 2011	10/02/2011	47,250	Fixed rate 6.375%	11/09/2019
		581,243
Interest and other		(93,617)
		487,626

On 21 January 2014 the Bank partially prepaid four subordinated bond issues for a nominal amount of €86.3 million.

On 10 October 2013 the Bank partially prepaid subordinated bond issues for a nominal amount of €50 million.

Preference shares

During 2014 partial amortisations of preferred shares took place in an amount of €2.51 million. At 31 December 2014 their nominal value stood at €58.34 million and the number of shares at 1,166,715.

At 31 December 2013 their nominal value stood at €60.84 million and the number of shares at 1,216,886.

The breakdown of issues of preferred shares in the Balance Sheet as at 31 December 2014 and 2013 is as follows:

	31/12/2014
	Issue		% Interest	Issue maturity
BK Emisiones Series I	28/07/2004	58,336	Eur+3.75% min 4% - max 7%	PERPETUAL
Balance as at 31 Dec. 2014		58,336

	31/12/2013
	Issue		% Interest	Issue maturity
BK Emisiones Series I	28/07/2004	60,844	Eur+3.75% min 4% - max 7%	PERPETUAL
Balance 31 Dec. 2013		60,844

g) Other financial liabilities

The composition of "Financial liabilities at amortised cost" in the consolidated balance sheet was as follows as at 31 December 2014 and 2013:

		€000s
	31/12/2014	31/12/2013
Bonds payable-	506,935	156,555
Payables in respect of factoring	17,221	23,532
Others	489,714	133,023
Security deposits received	411,042	614,938
Clearing houses	235,769	126,269
Tax-collection accounts	200,081	195,532
Special accounts-	66,696	125,137
Stock-Market transactions pending settlement	65,981	124,287
Other items	194,938	183,580
	1,615,461	1,402,011
In euros	1,602,343	1,391,414
In foreign currency	13,118	10,597
	1,615,461	1,402,011

The amount shown against "Security deposits received", relates to collateral received for securities loaned to credit institutions.

20. Liabilities under insurance contracts

As at 31 December 2014 and 2013, the balance of "Liabilities under insurance contracts" contains the liabilities undertaken by Línea Directa Aseguradora, S.A. de Seguros y Reaseguros in the course of its activity. The changes occurring in the financial years 2014 and 2013 for each of the technical allowances included in the balance sheet attached hereto, are as follows:

				€000s
	31/12/2014			31/12/2013
	Provision for Unearned Premium	Provision for Claims	Total	Provision	Provision for Claims	Total
Balance at start of period	321,202	286,592	607,794	324,322	293,964	618,286
Additions due to change in scope
Additions	326,576	273,477	600,053	321,202	272,287	593,489
Applications	(321,202)	(286,592)	(607,794)	(324,322)	(293,964)	(618,286)
Adjustments and settlements	-	14,727	14,727	-	14,305	14,305
Balance at close of period	326,576	288,204	614,780	321,202	286,592	607,794

The allowance for unearned premiums represents the fraction of the premiums accrued in the financial year that is attributed to the period between the closing date and the end of the policy coverage period, using the policy-by-policy procedure and taking as the basis for calculation the fee premiums accrued in the financial year, with the security surcharge being deducted.

The provision for claims represents the total amount of the insurer's pending obligations derived from claims occurring prior to the date on which the financial year is closed.

The Company establishes this provision for an amount that is sufficient to cover the cost of claims, meaning an amount that includes all the expenses, both external and internal, in managing and handling the files, regardless of their origin, incurred or to be incurred until the claims are fully settled and paid, less the amounts already paid.

The provision for claims in turn comprises two provisions: one for claims pending settlement or payment and for accidents pending claim; and another for internal expenses associated with the settlement of claims.

On 18 January 2009 the Company was authorised by the Directorate-General of Insurance and Pension Funds to apply statistical methodology in calculating the Technical Provision for Claims in accordance with the provisions of Article 43 of the Regulation on the Organisation and Supervision of Private Insurance following the amendment introduced by Royal Decree 239/2007 of 16 February.

As for the provision for internal expenses associated with the settlement of claims, a sufficient amount is added to it to meet the expenses necessary to finalise claims pending at year-end.

Procedures used to determine the main assumptions affecting assets, liabilities, income and expenses arising from insurance contracts and sensitivity analysis.

Income arising from insurance contracts consists mainly of insurance premiums paid in consideration of the risks assumed. Trends in premium income can be analysed using indicators such as average premium, product mix, percentage of cancellations, etc.

The main liability deriving from insurance contracts is that shown in the technical reserves, while the biggest expenses recognised in the Income Statement are the payment of claims and any additions considered necessary to provisions for payments pending at the end of the reporting period. To estimate these liabilities the Company analyses the changes over time in the frequency and average cost of events. Lastly, in estimating insurance liabilities the effect of reinsurance contracts is taken into account.

The net combined ratio measures the weight of the cost of claims and other expenses associated with the insurance business relative to the premiums accrued in the profit

and loss account, net of the reinsurance effect. Changes in the conditions influencing the insurance risk are reflected in increases or decreases in the net combined ratio.

The following table shows the impact that a 1%change in net income recognised in equity would have in 2014 and 2013, together with the volatility index of this ratio calculated on the basis of its typical deviation over the past five years:

		(€000s)
	2014		2013		Volatility
	Profit	Equity	Profit	Equity	Index
1% change in combined ratio (in %)	4.78%	1.71%	4.95%	0.98%	1.79%
1% change in combined ratio (in €000s)	4,488		4,498

Objectives, policies and procedures for managing the risks arising from insurance contracts

The risks involved in the insurance business are centred on the subscription risk in non-life insurance, which in turn consists of the premium sub-risk (the risk that premiums may not be sufficient)and the reserves sub-risk (the risk that the technical reserves may not be sufficient).

The Company makes use of reinsurance as the main means of mitigating the premium and reserves sub-risks. Reinsurance in turn forms part of counterparty risk, in view of the possibility of default by reinsurers on recoverable amounts.

Premium Sub-risk

The Technical Division of LDA is responsible for adjusting products and prices to the Company's general strategy. All such adjustments are supported by actuarial analyses duly documented in technical memoranda, and are approved by the Technical Committee, which is the body responsible for managing this sub-risk.

The Technical Committee takes operational decisions affecting prices and risk underwriting conditions of products offered by LDA, ensuring that they are consistent with the strategy and objectives laid down by the Board of Directors. In so doing it evaluates proposals presented by the Technical Division, also taking into account information on the business situation and future prospects provided by the business units.

Reserves Sub-risk

To estimate liabilities arising from insurance contracts, the Company uses statistical methods based on chain ladder methodology and stochastic methods based on bootstrap methodology. Finally it performs a validation using the average cost method.

The Claims and Reserves Committee is the body responsible for managing the Company's reserve risk and reinsurance credit risk. Its functions are to monitor the Company's reserves and provisions to ensure that claims are properly covered, and to approve changes to policies on opening and provisioning of claims under the various kinds of cover and guarantees, so as to ensure that reserves are adequate, in accordance with directives approved by the Company's Board of Directors.

It also approves the annual reinsurance programme and reports on it to the Management Committee.

Also, to ensure that the Company complies with the obligations deriving from Article 29 of the ROSSP ("Reglamento de Ordenación y Supervisión de los Seguros Privados", or Private Insurance Supervision Regulations) whereby the technical reserves must reflect in the Balance Sheet the obligations deriving from contracts written, the following controls are in place regarding additions to the technical reserves:

1. Analysis of future trends in cost deviations of events occurring before the end of each financial year. The analysis is carried out on the basis of events occurred and reported as at the end of the reporting period. The purpose of this is to check and correct any cost deviations arising on so-called long-tail claims caused by not having sufficient information to evaluate them at the end of the reporting period.

2. Producing monthly and quarterly projections of accident cost expense.

3. The company's reserves situation is also subjected to an analysis carried out by independent consultants at least once a year, which is presented to the Board of Directors.

Change during 2014 to the technical reserves (not counting cover for fines and travel assistance) corresponding only to claims pending as at 31 December 2013, broken down by branches, is as follows:

	(€000s)
	Reserves as at 31/12/2013	Net Payments	Reserves as at 31/12/2014	Surplus (Deficit)
Motor, Civil Liability	193,907	76,475	76,822	40,610
Motor, Other Coverage	60,429	29,018	21,779	9,632
Home	6,250	3,231	1,409	1,610
	260,586	108,724	100,010	51,852

Changes during 2013 in the Company's technical reserves, not counting cover for fines and travel assistance, corresponding only to claims pending as at 31 December 2012, excluding losses incurred but not reported, broken down by branch, were as follows:

	(€000s)
	Reserves as at 31/12/2012	Net Payments	Reserves as at 31/12/2013	Surplus (Deficit)
Motor, Civil Liability	201,175	80,057	88,878	32,240
Motor, Other Coverage	63,042	32,321	19,107	11,614
Home	5,165	3,166	1,101	898
	269,382	115,544	109,086	44,752

The above table includes the home insurance branch, which at year-end 2012 had had five full years of operation since its launch. Losses incurred but not reported (IBNR) are included in the reserves at the end of 2011 not in the home insurance branch but in the motor branches, since the reserve for pending losses incurred, reported and not reported, were calculated together using statistical methods.

Insurance risk concentrations

The Company's insurance business is located entirely in Spain, with no especially significant concentration in any particular geographical region.

The Company's business is centred on non-life branches, mainly motor, and is distributed as follows:

	€000s
	2014
	Total	Motor	Multi-risk Home
Premiums billed	650,619	593,245	57,374
Premiums ceded	(3,977)	(3,123)	(854)

	€000s
	2013
	Total	Motor	Multi-risk Home
Premiums billed	642,474	595,835	46,639
Premiums ceded	(3,478)	(2,780)	(698)

The Company is in the process of adapting to the Solvency II project, which will alter the focus of risk management for Europe's insurance companies.

21. Provisions

The following table shows the balances and movements of provisions during 2014 and 2013:

	Total	Pension funds and similar	Provisions for contingent risks and	Other Provisions	Provisions for taxes and other legal
(€000s)		obligations	commitments		contingencies
Balance at 31/12/2012	48,200	2,811	5,139	1,899	38,351
Net allocations charged to income	14,259	1,047	3,502	2,796	6,913
Transfer of funds	10,000	-	-	-	10,000
Application of funds	(26,189)	-	1	-	(26,190)
Other movements	7,483	(2,402)	-	2	9,883
Balance at 31/12/2013	53,753	1,456	8,642	4,697	38,958
Net allocations charged to income	44,626	3,090	(1,166)	4,631	38,071
Application of funds	(17,033)	(2,628)	-	(2,368)	(12,037)
Other movements	6,890	(1,100)	23	181	7,786
Balance at 31/12/2014	88,236	818	7,499	7,141	72,778

Of the above movements, €41.54 million is recognised in Other provisions in the income statement for 2014 and €14.26 million in that for 2013.

"Other movements" in "Provisions for taxes and other legal contingencies" reflect reclassification of balances, and during 2014, additions to the provision for corporate income tax.

The effects of the passage of time and changes in the discount rate during the year were €0.26 million and €0.16 million respectively (€0.44 million and €0.51 million in 2013).

Of all the provisions established, the most significant in terms of their amounts are those for taxes and other legal contingencies, which correspond respectively to tax contingencies arising from differences in interpretation with tax authorities and legal contingencies arising from claims by or on customers. Note 43 to the consolidated financial statements, "Tax situation" describes the Group's main tax contingencies.

• A) As for the tax provisions, as indicated in Note 42 to Bankinter's Statutory Report for 2014, any tax liabilities that might derive from the appeals lodged against tax assessments as detailed therein are adequately provisioned at year-end 2014. In this respect, in order to determine the amount of the balance of the corresponding provision, the Bank has made an appropriate assessment of the probability of its prevailing against the tax authorities in the aforementioned appeals, as well as how long it is likely to take to obtain a definitive administrative or judicial ruling and thus be able to finalise the matter.
• B) As regards the legal provisions, at year-end 2014, the existing contingencies are adequately provided for; to this end, the Bank takes account of the likelihood of obtaining a favourable outcome in the various procedures under way and the time it is likely to take to obtain a definitive judicial ruling.

As regards the legal proceedings arising from the contracting of financial swaps, their amount is set at indeterminate by the plaintiffs, since exact quantification of the contingency involved in these proceedings is not possible until a firm ruling is given and, if applicable, executed. In view of the uncertainty regarding the result of these legal proceedings, no provision has been recognised in respect of these proceedings for merely having been instigated. Where applicable, the provisions for these products are recognised when an outflow of resources from the Group is considered probable, in accordance with applicable accounting rules. In the Group's judgement, the provisions held are sufficient to cover any losses that might arise from the judicial proceedings.

As regards the calendar for the outflow of resources, the weighted average maturity of the tax contingencies is 6.3 years and that of the legal contingencies 5.9 years (3.7 and 2.1 years respectively in 2013).

There are no expected refunds that would give rise to the recognition of an asset.

Further details on the provisions for Pension Funds and similar obligations can be found in the Note on Employee Benefits in these notes to the financial statements. Similarly, further details on the Provisions for contingent risks and commitments are included in the Notes on credit risk management, since these relate basically to financial and technical guarantees and available undrawn balances under committed credit lines.

22. Shareholders' equity

The breakdown of the composition and movements in the Group's shareholders' equity in financial years 2014 and 2013 is included in the Overall Statement of Changes in Consolidated Public Net Worth.

a) Capital

As at 31 December 2014, the share capital of Bankinter, S.A. was represented by 898,866,154 registered shares with a nominal value of €0.30 each, fully subscribed and paid up. These shares all have equal voting and economic rights. As at 31 December 2013, the share capital of Bankinter, S.A. was represented by 895.583.800 registered shares with a nominal value of €0.30 each.

All the shares are represented by book entries, officially listed on the Madrid and Barcelona stock exchanges and traded by the Spanish computer-assisted trading system.

The following changes were recorded in the shares in circulation in financial years 2014 and 2013:

	€000s
	Number of	Nominal
	Shares	value
Balance at 31/12/2012	563,806,141	169,142
Additions	331,777,659	99,533
Bonus share issue charged to revaluation reserves	313,223,298	93,967
Conversion of subordinated bonds, May 2013	146,175	44
Conversion of subordinated bonds, November 2013	18,408,186	5,522
Balance at 31/12/2013	895,583,800	268,675
Additions	3,282,354	985
Conversion at maturity of the issue of mandatorily convertible subordinated bonds into Series I and Series II shares	3,282,354	985
Balance at 31/12/2014	898,866,154	269,660

The breakdown of shareholders with a percentage holding equal to or greater than 10% of share capital as at 31 December 2014 and 2013 is as follows:

	Number of	Shares held	Number of	Shares held
		Directly		Indirectly	% of share	capital
Shareholder	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013
Cartival,	204,706,145	204,681,888	-	-	22.77	22.85
S.A.

b) Share premium

During 2014 and 2013 the share premium account increased by the difference between the nominal value of the new shares and their subscription price.

Movements in the share premium account in 2014 and 2013 were as follows:

	€000s
	Issue premium
Balance at 31/12/2012	1,118,186
Additions	54,459
Of which on conversion of subordinated bonds	54,459
May conversion	486
November conversion	53,973
Balance at 31/12/2013	1,172,645
Additions	11,623
Of which on conversion of subordinated bonds	11,623
Conversion at maturity, May	11,623
Balance at 31/12/2014	1,184,268

c) Reserves

The breakdown of this item in the consolidated balance sheet is as follows:

	€000s
	31/12/2014	31/12/2013
Statutory reserve	57,467	34,076
Freely-available reserve	1,663,476	1,518,961
Revaluation reserve	38,974	46,861
Treasury shares reserve-	71,943	85,367
By acquisition	771	432
By guarantee	71,172	84,935
Canary Islands investment reserve	28,363	28,363
Reserves (losses) of entities accounted for using the equity
method-	(6,440)	4,681
Associates	(6,639)	4,482
Jointly controlled entities	199	199
	1,853,783	1,718,309

Statutory reserve

Companies are obliged to allocate 10% of their profits in each financial year to a reserve fund, until this reaches at least 20% of share capital. This reserve may not be distributed to shareholders and may be used only to cover losses if there are no other reserves available. In certain circumstances it may also be used to increase the share capital in the part of this reserve that exceeds 10% of the increased capital figure. At 31 December 2014 the legal reserves were fully constituted.

Revaluation reserves

This heading includes the revaluation reserves generated by business combination transactions. During 2013 the Group carried out a capital increase which was charged to the revaluation reserves, in an amount of €93.97 million (see point a) capital).

Voluntary reserves

Voluntary reserves are freely available for use.

Reserves (losses) of entities accounted for using the equity method-

The breakdown of the reserves and losses in companies accounted for using the equity method is as follows:

	€000s
	31/12/2014 31/12/2013
	Reserves	Reserves
Bankinter Seguros Generales, S.A.	(410)	232
Bankinter Seguros de Vida, S.A.	(6,357)	4,048
Helena Activos Líquidos, S.L.	128	202
Eurobits Technologies, S.L.	199	199
	(6,440)	4,681

d)Other Equity Instruments

On 11 May 2011 the Bank issued mandatorily convertible bonds for €404.81 million, in two series: Series I for a nominal amount of €175.00 million and Series II for a nominal amount of €229.81 million maturing 11 May 2014 with an annual remuneration of 7%. The terms of the issue conform to the definition of equity instrument since i) there is no obligation to deliver cash or other financial assets since conversion is mandatory, and since the remuneration is subject, inter alia, to the discretion of the Bank's Board of Directors, and ii) the conversion rate is fixed for all conversions as the result of dividing the nominal value of the bonds by the established conversion price (€6.28 and €5.03 per share for Series I and Series II respectively), subject in any case to fixed numbers of bonds being exchanged for fixed numbers of shares. The issue is therefore recognised in equity as "Equity - Other equity instruments".

On 11 May 2014, as a result of the maturity of the issue of both series, the bonds outstanding at that date (€12.61 million nominal) were converted into 3,282,354 new shares in Bankinter. This conversion led to an increase in the share capital of €0.99 million and an increase in the share premium of €11.62 million.

During 2013 the following mandatorily convertible subordinated bonds were voluntarily converted into new Series Iand II Bankinter shares:

On the ordinary voluntary conversion date, 11 May 2013, requests were made for the conversion of 6,130 Series I bonds with a nominal value of €306,000 and 4,469 Series II bonds with a nominal value of €224,000. To meet these conversion requests a total of 146,175 new shares were issued.

On the ordinary voluntary conversion date, 25 October 2013, requests were made for the conversion of 40,896 Series I bonds with a nominal value of €2,045,000 and 1,148 Series II bonds with a nominal value of €57,450,000. To meet these conversion requests a total of 18,408,186 new shares were issued.

None of the exchange transactions described involved the recognition of any amount in the enclosed consolidated Income Statements for the years ended 31 December 2014 or 2013.

Remuneration accruing during 2014 on this product amounted to €291,000 (€27,243 in 2013). This amount, which net of corporation tax comes to €205,000 (2013: €16,970) is recognised directly in equity as a deduction from reserves.

	€000s
Balance at 31/12/2012	72,633
Subordinated bonds cancelled upon conversion	60,024
May conversion	529
November conversion	59,495
Balance at 31/12/2013	12,609
Subordinated bonds cancelled upon conversion	12,609
Conversion at maturity, May	12,609
Balance at 31/12/2014	-

During 2014 and 2013 no transaction costs were recognised as deductions from equity in respect of the issue or acquisition of own equity instruments.

e) Own securities

As at 31 December 2014, the Group held 114,117 treasury shares (102,541 shares as at 31 December 2013).

During 2014, stock market transactions were carried out for the purchase of 8,409,960 shares (11,656,062 in 2013) and the sale of 8,398,384 shares (11,629,837 in 2013) on which gains of €26,000 were obtained, recognised directly in equity under "Reserves" in the Balance Sheet (€245,000 in 2013).

The breakdown of treasury stock as at 31 December 2014 and 2013 is as follows:

				€000s	Euros		€000s
	Number of shares			Nominal value Average acquisition price		Acquisition cost		Treasury-stock reserve		Percentage of capital
	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013	31/12/2014	31/12/2013
Bankinter, S.A.	114,117	102,459	34	31	6.00	3.43	771	511	771	511	0.01	0.01
Hispamarket, S.A.	-	82	-	-	6.77	3.61	-	-	-	-	-	-
Total	114,117	102,541	34	31	6.38	3.30	771	511	771	511	0.01	0.01

f) Results attributable to the Group

The breakdown of the individual pre-tax results for each of the companies belonging to the Group during the financial years 2014 and 2013 is as follows:

	2014 453,557	2013
Bankinter, S.A.		255,530
Bankinter Consultoría, Asesoramiento y Atención Telefónica, S.A.	612	167
Bankinter Gestión de Activos, S. A., SGIIC	37,546	23,976
Hispamarket, S. A.	959	(3,091)
Intermobiliaria, S. A.	(107,158)	(151,240)
Bankinter Consumer Finance, E.F.C., S.A.	36,987	33,879
Bankinter Capital Riesgo, SGECR, S. A.	281	266
Bankinter Sociedad de Financiación, S. A.	111	1,023
Bankinter Emisiones, S. A.	8	-
Bankinter Capital Riesgo I Fondo Capital	799	1,143
Grupo Línea Directa Aseguradora	133,930	128,513
Arroyo Business Consulting Development S.A.	(1)	(2)
Relanza Gestión S.A.	47	43
Gneis Global Services S.A.	10,137	16,952
Mercavalor	4,158	(352)
Bankinter Luxembourg, S.A.	(2,275)	(1,081)
Naviera Goya S.L. and Naviera Sorolla S.L.	4	(4)
Castellana Finance Limited	-	-

The result of the companies accounted for using the equity method for years 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Eurobits Technologies, S.L.	468	68
Helena Activos Líquidos, S.L.	8	(56)
Bankinter Seguros Generales, S.A.	(910)	(644)
Bankinter Seguros de Vida, S.A. de Seguros y Reaseguros	17,396	16,177

g) Earnings per share

Earnings per share are calculated by dividing profit attributable to the Group by the weighted average number of ordinary shares in circulation during the financial year, excluding any treasury stock acquired by the Group. In financial years 2014 and 2013, earnings per share are as follows:

16,962 15,545

	2014	2013
Profit for the year (€000s)	275,887	189,900
Average number of shares (000s)	897,291	784,085
Earnings per share (euros)	0.31	0.24

To calculate diluted earnings per share, the weighted average number of ordinary shares in circulation is adjusted to reflect the conversion of all the potentially dilutive ordinary shares. The potentially dilutive ordinary shares issued by the Group holds are the bonds convertible into shares at 31 December 2013. It is assumed that convertible bonds are converted into common shares. At 31 December 2014 the Group had no potentially dilutive ordinary shares.

The calculation of diluted earnings per share for the Group is as follows:

	2014	2013
Diluted profit for the year (€000s)	275,887	189,900
Average number of diluted shares (000s)	897,291	793,197
Diluted earnings per share (euros)	0.31	0.24

h) Dividends and remuneration

The breakdown of the dividends distributed from results of 2014 and 2013 is as follows, not including treasury shares in the Bank's possession:

Date	Dividend per Share (Euros)	Number of shares	Amount (€000s)	Date approved by Board	Results for the year
July 2013	0.0184252	877,175,614	16,161	Jun 2013	2013
Oct. 2013	0.0188483	877,175,614	16,531	Oct. 2013	2013
Jan. 2014	0.0222344	895,583,800	19,910	Dec 2013	2013
Apr. 2014	0.0014004	895,583,800	1,254	Feb 2014	2013
			53,856
May 2014	0.0221117	895,583,800	19,801	Apr. 2014	2014
Aug. 2014	0.0273269	898,866,154	24,556	Jul 2014	2014
Nov 2014	0.0273254	898,866,154	24,556	Oct 2014	2014
Mar 2015	0.0768139	898,866,154	69,031	Feb. 2015	2014
			137,944

The provisional accounting statements drawn up by the Bank in accordance with legal requirements, which prove the existence of sufficient resources for the distribution of interim dividends, were as follows:

	April
	2014	Jul. 2014	Oct. 2014
	First	Second	Third
Profit after tax (€000s)	60,002	134,414	205,082
Dividends paid (€000s)	-	19,801	44,357
Interim dividend (€000s)	19,801	24,556	24,556
Accumulated interim dividends
(€000s)	19,801	44,357	68,913
Gross dividend per share (euros)	0.02211170	0.0273269	0.0273254
Payment date	May 2014	Aug. 2014	Nov 2014

23. Valuation adjustments (equity)

The breakdown of this item is as follows:

		€000s
	31/12/2014	31/12/2013
Financial assets available for sale	123,727	41,605
Exchange differences	220	201
Entities accounted for using the equity method	4,422	1,366
Other valuation adjustments	1,162
	129,531	43,172

24. Offsetting of financial assets and liabilities and collateral.

The Bank does not engage in activities involving the offsetting of assets and liabilities. It does however engage in activities that require the mutual depositing with counterparties of collateral calculated on the basis of net risk.

The products mainly affected by collateralisation are derivatives under CSA (Credit Support Annex) and temporary acquisitions and sales of assets under GMRA (Global Master Repurchase Agreement). The following is a breakdown of the main characteristics and counterparties of these derivative products:

				Collateral	Collateral
Counterparty	Assets	Liabilities	Net	received	provided
Bankia	32	-214	-182	-	470
Barclays	37,941	-4,424	33,517	37,630	-
BBVA	64,642	-24,733	39,910	42,460	-
BNP	29,181	-13,320	15,861	17,630	-
BOFA	14,128	-352	13,776	14,210	-
BSCH	33,668	-27,544	6,124	12,100	-
CITI	10,408	-12,716	-2,309	1,900	-
Commerzbank	6,915	-9,260	-2,345	3,440	-
Credit Suisse	95,725	-119	95,606	24,900	-
Deutsche Bank	6,153	-23,230	-17,077	-	16,060
Goldman Sachs	23,227	-8,402	14,825	16,800	-
HSBC	1,986	-9,514	-7,528	-	6,700
JP	31,285	-9,463	21,822	22,150	-
La Caixa	13,293	-126	13,167	11,410	-
Morgan Stanley	291	-1,082	-791	-	800
Natixis	25,685	-11,140	14,545	12,100	-
Nomura	13,592	-8,416	5,176	5,770	-
NORDEA	-	-4,762	-4,762	-	4,740
RBS	16,301	-13,884	2,417	2,230	-
Sabadell	2,197	-	2,197	2,220	-
Société	2,041	-13,547	-11,506	-	11,250
UBS Ltd.	6	-361	-355	300	-
Grand total	428,985	-197,044	231,941	-	-

It should be borne in mind that differences as at 31 December 2014 between the valuation and the collateral are regularised by means of contributions of collateral between the counterparties on the following business day, if the transfer minimums are reached.

With regard to transactions for the acquisition and sale of assets (repos and reverse repos), the situation in respect of collateral is as follows, depending on whether it represents a positive or a negative valuation for the Bank:

Counterparty	Positive	Negative		Net	Collateral received		Collateral provided
Banco Sabadell	12	3,288		(3,276)		-	3,190
BANKIA	-	2,278		(2,278)		-	2,278
CAIXABANK	390	3,583		(3,193)		-	3,193
CECABANK	2,515	808		1,707		1,458	-
Special collateral			Collateral		Collateral
Counterparty	Positive	Negative	received		provided
JP MORGAN	274,220	297,450			28,168

There is a liquidity transaction with Nomura whereby Bankinter received €500 million and deposited collateral worth €667 million. Bankinter received €43 million as collateral from Nomura in respect of the difference in valuation.

Bankinter also uses clearing houses for transactions involving the temporary acquisition and sale of assets (repo and reverse repo), which require collateralisation in order to avoid counterparty risk. At 31 December 2014 it had positions with the following counterparties:

Counterparty	Acquisitions	Sales
BBVA	-	241,166
Cecabank	32,226	-
Catalunya Bank	377,995	-
Bankia	30,743	-
Liberbank	143,057	-
Abanca Group Banesco	817,223	155,074
Ibercaja Banco	266,766	-
Unicaja Banco	299,158	226,677
Caja España	-	142,714
RBC Dexia	-	116,017
Banco Popular	-	507,733
Barclays Bank	-	360,218
Natixis	-	286,797
Calyon	-	66,594

Bankinter also has other special deposits in guarantee in respect of the securitisation operation:

Counterparty	Special deposit in guarantee
BBVA	11,010.00
EUROPEA DE TITULIZACIÓN	4,130.00
EUROPEA DE TITULIZACIÓN	12,930.00
EUROPEA DE TITULIZACIÓN	3,850.00
EUROPEA DE TITULIZACIÓN	5,160.00

25. Contingent risks and commitments

The composition of this item is as follows:

	€000s
	31/12/2014	31/12/2013
Contingent risks:
Financial guarantees-	763,223	661,879
Financial guarantees	763,223	661,879
Irrevocable documentary credits	197,439	123,893
Other guarantees and sureties given	1,735,235	1,676,110
Other contingent risks	40,632	50,937
	2,736,529	2,401,895
Contingent commitments:
Available to third parties	8,228,081	8,237,265
Commitments to purchase financial assets in instalments	9,575	10,021
Contractual agreements to acquire financial assets	5,276,596	5,278,585
Subscribed securities pending disbursement	120	120
Other contingent commitments	13,342	22,728
	13,527,713	13,548,719

The item "Contingent commitments available by third parties" consists entirely of commitments on immediately available credit.

26. Transfers of financial assets

The breakdown of transfers of financial assets carried out by the Group at 31 December 2014 and 2013 is as follows:

		€000s
	31/12/2014	31/12/2013
Removed from the balance sheet	834,922	960,824
Retained in the balance sheet in full	2,944,285	3,290,485
	3,779,207	4,251,309

During 2014 there were no prepayments of securitisation funds.

During 2013 the Bankinter 12 FTH securitisation fund was amortised early.

The derecognised assets refer to the loans securitised prior to 1 January 2004, as described below:

• In 2003, mortgage loans valued at €1.35 billion were transferred to "Bankinter 6, Asset Securitisation Fund", and loans to SMEs valued at €250 million were transferred to "Bankinter I FTPYME, Asset Securitisation Fund".
• In 2002 mortgage loans valued at €1.03 billion were transferred to "Bankinter 4, Mortgage Securitisation Fund", and mortgage loans valued at €710 million were transferred to "Bankinter 5, Mortgage Securitisation Fund".
• In 2001 mortgage loans valued at €1.33 billion were transferred to "Bankinter 3, Mortgage Securitisation Fund".
• In 1999, mortgage loans valued at €600 million were transferred to "Bankinter 1, Mortgage Securitisation Fund", and mortgage loans valued at €320 million were transferred to "Bankinter 2, Mortgage Securitisation Fund".

The assets retained in full on the Bank's balance sheet correspond to the securitisations of loans carried out after 1 January 2004. The main characteristics of these securitisations are as follows (amounts in €000s):

Fund	Series	Rating	Amount	Interest	Maturity
	A-Series	Aaa/AAA:	471,800	Eur 3 m. + 0.21%	26/09/2040
BK 7 FTH	B-Series	A2/A:	13,000	Eur 3 m. + 0.55%
	C-Series	Baa3/BBB:	5,200	Eur 3 m. + 1.20%
Total			490,000
	A-Series	Aaa/AAA:	1,029,300	Eur 3 m. + 0.17%	15/12/2040
BK 8 FTA	B-Series	A2/A:	21,400	Eur 3 m. + 0.48%
	C-Series	Baa3/BBB:	19,300	Eur 3 m. + 1.00%
Total			1,070,000
	A1 (P) Series	Aaa/AAA:	66,600	Eur 3 m. + 0.07%	16/07/2042
	A2 (P) Series	Aaa/AAA:	656,000	Eur 3 m. + 0.11%
	B (P) Series	A2/A+:	15,300	Eur 3 m. + 0.50%
	C (P) Series	Baa3/BBB:	7,100	Eur 3 m. + 0.95%
		Total (1)	745,000
BK 9 FTA	A1 (T) Series	Aaa/AAA:	21,600	Eur 3 m. + 0.07%	16/07/2042
	A2 (T) Series	Aaa/AAA:	244,200	Eur 3 m. + 0.11%
	B (T) Series	A1/A:	17,200	Eur 3 m. + 0.50%
	C (T) Series	Baa1/BBB-:	7,000	Eur 3 m. + 0.95%
		Total (2)	290,000
Total			1,035,000

Fund	Series	Rating	Amount	Interest	Maturity
	A1 Series	Aaa/AAA:	80,000	Eur 3 m. + 0.08%	21/06/2043
	A2 Series	Aaa/AAA:	1,575,400	Eur 3 m. + 0.16%
	B-Series	A1/A:	20,700	Eur 3 m. + 0.29%
BK 10 FTA	C-Series	Baa1/BBB-:	22,400	Eur 3 m. + 0.70%
	D Series	Ba3/BB-:	19,100	Eur 3 m. + 2.00%
	E Series	Caa3/CCC-	22,400	Eur 3 m. + 3.90%
Total			1,740,000
	A1 Series	Aaa/AAA:	30,000	Eur 3 m. + 0.05%	21/08/2048
	A2 Series	Aaa/AAA:	816,800	Eur 3 m. + 0.14%
	B-Series	Aa3/A:	15,600	Eur 3 m. + 0.30%
BK 11 FTH	C-Series	Baa1/BBB-:	15,300	Eur 3 m. + 0.55%
	D Series	Ba3/BB-:	9,800	Eur 3 m. + 2.25%
	E Series	Ca	12,500	Eur 3 m. + 3.90%
Total			900,000

Fund	Series	Rating	Amount	Interest	Maturity
	A1 Series	Aaa/AAA:	49,000	Eur 3 m. + 0.06%	16/05/2043
	A2 Series	Aaa/AAA:	682,000	Eur 3 m. + 0.12%
BK 2 Pyme	B-Series	Aa3/A+:	16,200	Eur 3 m. + 0.22%
FTA	C-Series	Baa2/BBB	27,500	Eur 3 m. + 0.52%
	D Series	Ba3/BB	10,700	Eur 3 m. + 2.10%
	E Series	C/CCC-	14,600	Eur 3 m. + 3.90%
Total			800,000
	A1 Series	Aaa/AAA:	85,000	Eur 3 m. + 0.06%	17/07/2049
	A2 Series	Aaa/AAA:	1,397,400	Eur 3 m. + 0.15%
	B-Series	Aa3/A:	22,400	Eur 3 m. + 0.27%
BK 13 FTA	C-Series	A3/BBB	24,100	Eur 3 m. + 0.48%
	D Series	Ba1/BB-	20,500	Eur 3 m. + 2.25%
	E Series	Ca/CCC-	20,600	Eur 3 m. + 3.90%
Total			1,570,000
	A-Series	AAA	83,700	Eur 3 m. + 0.30%	08/01/2050
	B1 Series	AA	26,000	Eur 3 m. + 0.70%
CASTELLANA	B2 Series	AA	10,000	Eur 3 m. + 0.85%
FINANCE	C1 Series	A+	38,700	Eur 3 m. + 1.20%
	C2 Series	A	23,900	Eur 3 m. + 1.50%
	D Series		2,850	Eur 3 m. + 7.00%
Total			185,150

Fund	Series	Rating	Amount	Interest	Maturity
	A1 Series	Aaa/AAA:	180,000	Eur 3 m. + 0.09%	18/02/2046
	A2 Series	Aaa/AAA:	288,900	Eur 3 m. + 0.20%
	A3 Series (guaranteed)	Aaa/AAA:	91,200	Eur 3 m. + 0.02%
BK 3 FTPyme FTA	B-Series	Aa3/AA:	23,100	Eur 3 m. + 0.35%
	C-Series	Baa2/BBB	6,000	Eur 3 m. + 0.90%
	D Series	Ba3/BB	10,800	Eur 3 m. + 1.80%
	E Series	C/CCC-	17,400	Eur 3 m. + 3.90%
Total			617,400
	A1 Series	AAA	160,000	Eur 3 m. + 0.32%	18/10/2051
	A2 Series	AAA	174,400	Eur 3 m. + 0.30%
BK 4 FTPyme FTA	A3 Series (guaranteed)	AAA	19,600	Eur 3 m. + 0.34%
	B-Series	A	30,000	Eur 3 m. + 0.50%
	C-Series	BBB	16,000	Eur 3 m. + 0.70%
Total			400,000

As at 31 December 2014 the Balance Sheet included securitisation bonds issued by securitisation funds forming part of the consolidated Group for an amount of €909.43 million (€883.81 million as at 31 December 2013). These securities are recognised as liabilities in the Balance Sheet, as deductions from the amount of the corresponding issues under the heading "Customer deposits".

Castellana Finance Limited is a special purpose vehicle established in 2007. This vehicle was initially outside the consolidation scope, basically because the Group retained no material risks or rewards. However, during the first half of 2013 its situation of control was reviewed, and it was concluded that it should be integrated into the Group as at 30 June 2013. This revision was undertaken after successive purchases by Bankinter, S.A. of bonds issued by the vehicle, which had also restructured its balance sheet.

There are no agreements whereby the Bank has to recognise a financial liability in the balance sheet because it commits to provide financial support to the securitised assets.

The outstanding balance of securitisations removed from the balance sheet prior to 1 January 2004, as at 31 December 2014 and 2013 was as follows:

	€000s
	31/12/2014	31/12/2013
Removed from the balance sheet prior to 01-01-04:
Bankinter 2 Mortgage Securitisation Fund	22,883	27,633
Bankinter 3 Mortgage Securitisation Fund	164,308	194,304
Bankinter 4 Mortgage Securitisation Fund	181,917	210,598
Bankinter 5 Mortgage Securitisation Fund	131,505	150,152
Bankinter 6 Mortgage Securitisation Fund	334,310	378,137
	834,923	960,824

As regards securitisations retained in full on the balance sheet, the following are the main balance sheet data together with the fair value of the assets transferred and associated liabilities.

		€000s
Bonds	Outstanding balance as at 31/12/2014	Carrying amount of associated liabilities (notes)	Original value of assets transferred	Fair value of assets transferred	Fair value of associated liabilities	Net Position
Retained on the balance sheet in full:
Bankinter 7 Mortgage Securitisation Fund	123,302	111,024	490,000	120,373	116,397	3,976
Bankinter 8 Asset Securitisation Fund	271,875	253,482	1,070,000	263,837	254,594	9,243
Bankinter 9 Asset Securitisation Fund	351,420	305,834	1,035,000	301,216	291,069	10,147
Bankinter 10 Asset Securitisation Fund	615,708	519,450	1,740,000	543,207	524,427	18,780
Bankinter 11 Mortgage Securitisation Fund	371,215	268,364	900,000	308,139	298,117	10,022
Bankinter 2 Asset Securitisation Fund	133,530	113,501	800,000	106,772	103,127	3,645
Bankinter 13 Asset Securitisation Fund	765,674	474,957	1,570,000	496,679	481,654	15,025
Bankinter 3 Asset Securitisation Fund	175,681	35,803	617,400	37,441	35,830	1,611
Bankinter 4 Ftpymes, Asset Securitisation Fund	135,881	36,441	400,000	-	-	-
	2,944,286	2,118,856	8,622,400	2,177,664	2,105,215	72,449

	€000s
Bonds	Outstanding balance as at 31/12/2013	Carrying amount of associated liabilities (notes)	Original value of assets transferred	Fair value of assets transferred	Fair value of associated liabilities	Net Position
Retained on the balance sheet in full:
Bankinter 7 Mortgage Securitisation Fund	138,384	129,530	490,000	135,590	130,968	4,622
Bankinter 8 Asset Securitisation Fund	304,377	291,127	1,070,000	304,748	293,961	10,787
Bankinter 9 Asset Securitisation Fund	388,709	325,797	1,035,000	341,040	329,054	11,987
Bankinter 10 Asset Securitisation Fund	677,825	574,624	1,740,000	601,510	580,154	21,355
Bankinter 11 Mortgage Securitisation Fund	409,087	366,770	900,000	383,931	371,000	12,931
Bankinter 2 Asset Securitisation Fund	165,139	148,405	800,000	155,353	150,113	5,240
Bankinter 13 Asset Securitisation Fund	831,214	618,891	1,570,000	647,848	627,544	20,304
Bankinter 3 Asset Securitisation Fund	212,529	46,729	617,400	48,915	46,770	2,145
Bankinter 4 Ftpymes, Asset Securitisation Fund	163,221	-	400,000	-	-	-
	3,290,485	2,501,873	8,622,400	2,618,935	2,529,564	89,371

27. Financial derivatives

The breakdown of the notional values of the financial derivatives held by the Group at 31 December 2014 and 2013 is as follows:

	€000s
	31/12/2014	31/12/2013
Financial derivatives (Notes 7 and 10):
Exchange-rate risk	5,576,035	6,341,818
Interest-rate risk	11,683,621	12,068,282
Equity risk	4,306,187	3,159,720
Risk on merchandise	4,000
Credit risk	-	-
	21,569,843	21,569,820

The notional amount of the contracts does not reflect the actual risk assumed by the Group in relation to such instruments.

28. Personnel expenses

The composition of the amounts included under this item in the consolidated income statement for financial years 2014 and 2013 is as follows:

	€000s
	2014	2013
Salaries and bonuses paid to active staff	264,276	262,723
Social Security contributions	63,639	58,371
Contributions to defined benefit plans	898	1,160
Contributions to defined plans	1,440	55
Severance packages	10,504	11,602
Other personnel expenses	27,981	22,922
	368,738	356,833

The breakdown of the Group's personnel as at 31 December 2014 and 2013, in accordance with pension commitments, was as follows:

	31/12/2014	31/12/2013
Employees in service since before 8 March 1980	232	268
Personnel who are pension beneficiaries	69	69
Early retirees	10	16
Other active employees	3,953	3,820

Post-employment benefits

As regards pension commitments, under the terms of the Collective Labour Agreement in force, for personnel employed since before 8 March 1980 and for certain members of personnel according to individually established agreements, the Bank has undertaken the commitment to complement Social Security payments in cases of retirement (as defined benefits). This provident scheme is managed and guaranteed, externally as regards the management of the Bank, by means of a number of insurance policies covering all its risks, both financial (returns and changes in interest rates) and demographic (survival), thus obtaining firstly a high degree of immunisation and diversification among the various insurers; and secondly, the guarantee of an external management of the scheme as regards the risks of the Bank itself.

Additionally, there is a group of early retirees who retired early in December 2002 and December 2003, to whom the Bank has committed to pay a financial benefit in fourteen monthly amounts not subject to revaluation until the date on which they attain 65 years of age, this amount being established individually with each early retiree, and a financial benefit in twelve monthly instalments until the date on which they attain 65 years of age for the contributions to the Special Social Security Agreement, on the terms established with each early retiree, which are subject to revaluation in accordance with increases in the Minimum Bases for Self-Employed Workers / Maximum Contribution Bases.

Lastly, for members of Senior Management appointed in or after 2012, a single contribution of €656,560 will be made to a Unit-Linked contract with AXA Seguros y Reaseguros S.A., such that in the event of retirement, death or incapacity, the beneficiary will receive the funds accumulated in the Unit-Linked contract at the time of the loss.

Other long-term benefits

Moreover, under the Collective Bargaining Agreement in force, the Bank has undertaken the commitment to complement Social Security payments to total, if necessary, certain payments for permanent invalidity, widowhood or orphancy.

In order to cover the aforementioned pension commitments, the Bank has an insurance policy with Winterthur Seguros y Reaseguros S.A. (now AXA Seguros y Reaseguros S.A. as a result of the subsequent merger of the two companies) backed by the unconditional guarantee of the parent company, Winterthur A.G., which guarantees the future coverage of all pension supplements payable to non-active staff arising prior to financial year 2003. In addition, for non-active staff as from 2003 and for the cover of active staff, the aforementioned benefits are guaranteed under a co-insurance policy in which Winterthur Seguros y Reaseguros (now AXA Seguros y Reaseguros S.A.) has a 40% participation, acting as lead co-insurer, while Caser Ahorrovida S.A. de Seguros y Reaseguros and Allianz, Compañía de Seguros y Reaseguros S. A. each have a 30% participation.

In 2014 regular premiums paid for retirement cover, net of recoveries, totalled €7,000 (€432,000 in 2013).

Premiums paid for death and incapacity cover in 2014 amounted to €58,000 (€100,000 in 2013).

Active personnel

The basic assumptions used for the calculations in the actuarial study of defined benefit obligations as at 31 December 2014 and 2013 for commitments to active personnel, are as shown in the following table:

	31/12/2014	31/12/2013
Mortality:	Probabilities set in the GKM/- 95 tables, at 80%.	Probabilities set in the GKM/- 95 tables, at 80%.
Survival
Men:	Probability associated with PERM-2000 P table.	Probability associated with PERM-2000 P table.
Women:	Probability associated with PERF-2000 P table.	Probability associated with PERF-2000 P table.
Type of updating:	iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Forecast total yield from the assets:	iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Rise in CPI:	2%	2%
Salary inflation:	3.50% for remuneration items linked to the collective bargaining agreement	3.50% for remuneration items linked to the collective bargaining agreement
Social Security evolution
Rise in Maximum
Maximums:	2%	2%
Maximum pension:	2%	2%

The most significant aspects of the actuarial study carried out as at 31 December 2014 and 2013 are as follows:

	€000s
	31/12/2014	31/12/2013
Value of the obligations	38,345	32,400
Fair value of plan assets:
Allianz	11,504	9,911
Caser	11,504	9,911
AXA	15,337	13,215

One significant aspect of the difference between the actuarial values as at 31 December 2013 and 2014 is that the provisions for retirement commitments increased as a consequence of the evolution of the financial markets during 2014. As at 3 December 2013 the 21-year return - this being the average financial duration of the commitments undertaken - based on the iBoxx Corporate AA 10+ curve, was 3.10%, and as at 3 December 2014 the return was 1.70%. As a result, the amount of cover for pension commitments increased by €9.64 million.

The financial duration of the payment obligations assumed or accrued at year-end for personnel in service (obligations in respect of early retirees have also been included) is 20.86 years (21.48 years in 2013), distributed as follows:

Less than 5 years	4%
From 5 to 10 years	13%
From 10 to 15 years	17%
From 15 to 20 years	17%
More than 20 years:	49%

Personnel that are pension beneficiaries

The most significant aspects of the actuarial study carried out as at 31 December 2014 and 2013 are as follows:

	31/12/2014	31/12/2013
Value of the obligations	11,202	9,524
Fair value of the plan assets	11,163	9,493
Actuarial assumptions
Tables used
Pensions deriving from the initial premium	PERMF/2000 P	PERMF/2000 P
Pensions deriving from subsequent contributions	PERMF/2000 P	PERMF/2000 P
Technical interest rate	iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Forecast total yield from the assets:	iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Rise in salaries	Not applicable	Not applicable
Pension revaluation rate	Not applicable	Not applicable

One significant aspect of the difference between the actuarial values as at 31 December 2013 and 2014 is that the provisions for retirement commitments increased as a consequence of the evolution of the financial markets during 2014. As at 3 December 2013 the 12-year return - this being the average financial duration of the commitments undertaken - based on the iBoxx Corporate AA 10+ curve was 3.10%, and as at 3 December 2014 the return was 1.70%, based on iBoxx Corporate AA 10+ rates. As a result, the amount of cover for pension commitments increased by €1.48 million.

The financial duration of the payment obligations assumed or accrued at year-end for retired personnel is 12.15 years, distributed as follows:

Less than 5 years	27%
From 5 to 10 years	22%
From 10 to 15 years	18%
From 15 to 20 years	13%
More than 20 years:	20%

Early retirees. Post-employment and other long-term benefits

In 2002 and 2003 the Bank organised two early retirement schemes for employees. The commitments undertaken towards them up until the date of retirement were insured with Nationale-Nederlanden Vida. The commitments undertaken towards early retirees from the date of retirement are covered in the same policy, under a co-insurance between Winterthur (now AXA) (40%), Allianz (30%) and Caser (30%) covering active personnel who are beneficiaries of a pension after financial year 2003.

The basic assumptions used for the calculations in the actuarial study, as at 31 December 2014 and 2013, for commitments to active personnel, are as shown in the following table:

	31/12/2014	31/12/2013
Survival:
Men	Probability associated with PERM-2000 P table.	Probability associated with PERM-2000 P table.
Women	Probability associated with PERF-2000 P table.	Probability associated with PERF-2000 P table.
Type of updating:
Early retirement stage Retirement stage	iBoxx Corporate AA 1-3 years rate as at 3 Dec. 2014 iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA 1-3 years rate as at 3 Dec. 2013 iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Forecast total yield from the assets:	iBoxx Corporate AA +10 years rate as at 3 Dec. 2014	iBoxx Corporate AA +10 years rate as at 3 Dec. 2013
Rise in CPI:
Early retirement stage	2% for re-valuable benefits	2% for re-valuable benefits
Retirement stage	2%	2%
Salary inflation:
Retirement stage	3.50% for remuneration items linked to the collective bargaining agreement	Not applicable
Social Security evolution
Rise in Maximum Bases	2%	2%
Maximum pension:	2%	2%

For the retirement stage of early retirees and for the part accrued and not accrued at 31 December 2014 and 2013, the same profitability as mentioned previously for commitments undertaken with active personnel were used.

The most significant aspects of the actuarial study carried out as at 31 December 2014 and 2013 are as follows:

	€000s
	31/12/2014		31/12/2013
	Early retirement	Retirement stage	Early retirement	Retirement stage
	stage		stage
Other long-term benefits:
Early retirees 2002	-		5
Early retirees 2003	717		1,356
Post-employment benefits
Early retirees 2002		-		239
Early retirees 2003		5,092		6,981
Contracts of insurance linked to pensions:
Nationale Nederlanden Vida	714	714	1,327	-
Plan assets: Allianz, Compañía de Seguros y Reaseguros, S.A.	-	1,528	-	2,245
Caser, S.A. de Seguros y Reaseguros sobre la Vida	-	1,528	-	2,245
AXA, S.A., Seguros y Reaseguros	-	2,037	-	2,994

As regards pre-retirement commitments, one significant aspect of the difference between the actuarial valuations as at 31 December 2013 and 2014 is that additions to provisions for retirement commitments were reduced considerably as a result of the large number of people retiring.

As regards post-employment commitments, one significant aspect of the difference between the actuarial valuations as at 31 December 2013 and 2014 is that the additions to provisions for retirement commitments were reduced substantially as a result of benefits initially envisaged as annuities being taken as capital.

The following is an explanation of the change in defined benefit pension commitments as at 31 December 2014 compared with 31 December 2013 and coverage thereof:

	€000s
Valuation of commitments as at 31-12-2013:	48,855
Active Personnel	32,400
Early retirees (early retirement stage)	1,360
Early retirees (retirement stage)	5,571
Personnel who are pension beneficiaries	9,524
Changes in obligations during financial year 2014:	487
Accruals for the year 2014:	833
Pension fund interest:	1,469
Reductions for payments of benefits or cancellation of commitments:	(5,825)
Actuarial profits and losses (deviation and changes to assumptions)	10,024
Breakdown: due to demographic assumptions – (€1.10 million) due to financial assumptions – (€11.13 million)
Valuation of commitments as at 31-12-2014:	55,356
Active Personnel	38,345
Early retirees (early retirement stage)	717
Early retirees (retirement stage)	5,092
Personnel who are pension beneficiaries	11,202
Coverage of obligations as at 31-12-2013:	49,429
Plan assets	48,102
Pension-linked insurance agreements	1,327
Other funds	-
Return anticipated from plan assets/insurance contracts:	1,471
Actuarial gains / (losses)	10,460
Contributions	4,843
Recoveries	(4,797)
Benefits paid	(3,184)
Coverage of obligations as at 31-12-2014:	58,221
Plan assets	57,507
Pension-linked insurance agreements	714

Table for reconciling the value of the obligations and the fair value of the assets assigned to cover them:

Reconciliation of the components of pension expenses

	€000s
Period ending 31 December 2014	Present value of committed benefits	Value of the associated funds
Value as at 01 January 2014	48,855	49,429
Normal Cost (Annual accrual)	833
Interest Cost (financial expenses)	1,469
Expected return on plan assets		1,471
Company contributions		4,843
Company recoveries		(4,797)
Benefits paid	(3,188)	(3,184)
Early retiree risk premiums earned	(2)
Reduction in commitments Actuarial losses / (gains)	(2,635) 10,024
(Losses) / gains on the value of the fund		10,459
Value as at 31 December 2014	55,356	58,221

Thus the balances shown in the balance sheet as provisions for pensions at yearend 2014 and 2013 amount to €0.82 million and €1.46 million respectively. These balances break down as follows:

2013:

• Provision for Christmas hamper (given to retired personnel): €0.03 million
• Provision for committed payments to early retirees (income agreed before retirement): €1.36 million
• Provision for pension commitments Bankinter Luxembourg: €0.06 million
• TOTAL: €1.46 million

Note 1: the Christmas hamper is a commitment paid in kind; it is provided for but it is not externalised, since it is not a monetary commitment.

Note 2: benefits agreed in connection with early retirement relating to payment dates prior to retirement date are not commitments externalised off-balance sheet insofar as they are not items relating to retirement, death or incapacity (for which reason, conversely, post-retirement benefits agreed are so externalised.)

2014:

• Provision for Christmas hamper (given to retired personnel): €0.04 million
• Provision for committed payments to early retirees (income agreed before retirement): €0.72 million
• Provision for pension commitments Bankinter Luxembourg: €0.06 million
• TOTAL: €0.82 million

Note 3: pension commitments in Luxembourg (under the collective labour agreement of personnel employed there) are handled and paid in Luxembourg.

Remaining commitments totalling €48.56 million in 2013 and €55.36 million in 2014, are detailed hereunder, and are not on the balance sheet since they are externalised (being post-retirement, death or disability benefits):

2013:

• Balance sheet: provision for Christmas hamper: €0.03 million
• Balance sheet: provision for pre-retirement benefits for early retirees: €1.36 million

• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement benefits to personnel in active service: €32.4 million

• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement benefits agreed after retirement date) for early retirees: €5.57 million

• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement, death (widowhood/orphancy) and disability for retired personnel (vested benefits): €9.49 million

TOTAL: €48.85 million

2014:

• Balance sheet: provision for Christmas hamper: €0.04 million
• Balance sheet: provision for pre-retirement benefits for early retirees: €0.72 million
• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement benefits to personnel in active service: €38.34 million
• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement benefits agreed after retirement date) for early retirees: €5.09 million
• Externalised and off-balance sheet: Amount corresponding to commitments in respect of retirement, death (widowhood/orphancy) and disability for retired personnel (vested benefits): €11.16 million

TOTAL: €55.36 million

The reconciliation for 2014 of the aforementioned amounts is as follows:

1. Christmas hamper (balance sheet):

Year-end 2013: €0.03 million

• interest cost 2014: +€0.001 million
• benefits (hampers 2014): -€0.003 million
• Actuarial gains and losses: €0.01 million
• Year-end 2014: €0.04 million

2. Early retirees (balance sheet):

Year-end 2013: €1.36 million

• interest cost 2014: +€0.007 million
• benefits: -€0.66 million
• risk premiums: -€0.002 million
• Actuarial gains and losses: €0.015 million

Year-end 2014: €0.72 million

3. Other externalised commitments (off-balance sheet):

Year-end 2013: €47.46 million Which break down into 32,400 (personnel in service) + 5,571 (early retirees, pre-retirement benefits) + 9,493 (retired personnel), €000s, as previously indicated.

• accruals for the year 2013 +€0.83million
• interest cost 2013: +€1.46 million
• benefits: -€2.52 million
• reductions in the plan: -€2.63 million
• Actuarial gains and losses: +€9.99 million

Year-end 2014: €54.6 million Which break down into 38,345 (personnel in service) + 5,092 (early retirees, pre-retirement benefits) + 11,163 (retired personnel), €000s, as previously indicated.

Lastly, with regard to the PLAN ASSETS, in the amount of €48.10 million for 2013 and €57.51 million for 2015, the reconciliation is as follows:

Year-end 2013: €48.10 million

• expected return on assets 2013 +€1.46 million.
• contributions/premiums paid 2013: +€4.80 million
• recoveries/surrenders 2013: -€4.80 million
• benefits paid 2013: -€2.52 million
• Actuarial gains and losses: +€10.45 million

Year-end 2013: €57.51 million

Sensitivity to change in the main valuation assumptions:

		To the interest rate		To salary increases		Sensitivity to survival rates
	Year-end	- 0.5% 1.2%	+ 0.5% 2.2%	- 0.5% 3%	+ 0.5% 4%	PERM/F mortality tables - 1 year
Present value of committed benefits	55,356	60,329	50,948	54,101	56,651	57,149
Value of the associated funds	58,221	63,402	53,629	58,111	58,254	59,984

The following is a reconciliation between the present value of defined benefit obligations and the fair value of the plan assets with the assets and liabilities recognised in the Balance Sheet as at 31 December 2014:

Post-employment benefits

Active, passive and early-retired personnel
Present value of committed benefits	54,600
Value of the associated funds	57,507
Pension assets	2,907
Other liabilities
Present value of committed benefits	39
Value of the associated funds	-
Pension liabilities	39

Other long-term benefits

Early retirees
Present value of committed benefits	717
Value of the associated funds	-
Pension liabilities	717
Insurance agreements linked to pensions	714

Pension costs incurred in 2014 for defined benefit commitments

The total cost recognised in the Income Statement for 2014 for coverage of pension commitments amounts to (€1.80 million), as per the following breakdown:

	€ 000s
Cost of services in the current period:	833
Financial cost	(3)
Reduction in pension commitments	(2,635)
Actuarial gains and losses (early retirees):	10

The Bank's estimate with regard to pensions costs for 2015 amounts to €0.94 million.

Breakdown of plan assets associated with cover of defined benefit commitments

The following is a breakdown of insurance policies taken out with the various insurance institutions (at fair value):

	Percentage
Axa - Winterthur	45%
Allianz	27%
Caser	27%
Nationale Nederlanden	1%

The anticipated return at the start of the financial year for the assets in the plan was estimated at €1.47 million, whereas the actual return obtained was €11.93 million, the difference being due almost entirely to the increase in value as a result of the fall in market rates between the end of the previous financial year and the end of 2014.

The Bank's estimate of contributions to the plan (net of recoveries) during 2015 amounts to €1.08 million.

The expected return on plan assets for 2015 as estimated at the start of the year is €1.06 million.

Details of changes in the present value of defined benefit pension commitments and the assets assigned to cover them as at each year-end.

			€000s
Year	Defined Benefit Obligations	Assets Assigned	Other Own	Deficit/Surplus	Net actuarial gains and losses
2.009	67,525	67,396	129	-	1,022
2010	73,154	74,925	44	1,814	1,090
2011	64,869	70,835	39	6,005	8,503
2012	48,368	51,773	35	3,440	6,535
2013	48,855	49,429	31	605	1,210
2014	55,356	58,221	39	2,904	455

Pension costs incurred in 2014 for defined contribution commitments

The total cost recognised in profit and loss in 2014 for coverage of defined contribution pension commitments amounts to €1.23 million.

This cost is almost entirely due to the new Company Social Provident Plan put in place during 2014 and managed by Mutuactivos Pensiones, pursuant to the provisions of the 22nd Collective Labour Agreement for the Banking sector, which requires a defined contribution Complementary Social Providence system to be set up for employees entering service after 8 March 1980 and with at least two years of service in the Company, with a minimum annual contribution of €300.

The average number of employees by category and sex during financial years 2014 and 2013 was as follows:

	2014		2013
	Men	Women	Men	Women
Managers	404	176	405	168
Executives	1,057	905	973	823
Operatives	587	1,021	627	1,089
	2,048	2,102	2,005	2,080

The breakdown of personnel by sex and category as at 31 December 2014 and 2013 was as follows:

	2014		2013
	Men	Women	Men	Women
Managers	410	179	407	172
Executives	1,080	948	999	852
Operatives	578	990	604	1,054
	2,068	2,117	2,010	2,078

29. Fees received and paid

Details of this heading in the consolidated income statement for the years ended 31 December 2014 and 2013 are as follows:

	€000s
	2014	2013
Fees expense:
Fees paid to other institutions and correspondents	23,984	24,323
Fees paid to brokers, virtual banking	33,530	23,861
Other fees	16,377	15,879
Total fees expense	73,891	64,063
Fee income:
For guarantees and documentary credits	29,522	29,500
For exchange of foreign currencies and foreign banknotes	8,619	7,678
For contingent commitments	16,542	15,819
For collections and payments-	69,798	70,340
Trade bills	6,093	5,271
Sight accounts	14,859	15,384
Credit and debit cards	33,990	33,938
Cheques	835	1,023
Payment orders	14,021	14,724
For securities services-	70,747	49,454
Underwriting and placement of securities	2,654	1,248
Securities trading (see Note 41)	31,476	22,906
Administration and custody of securities	25,008	19,447
Wealth management (see Note 41)	11,609	5,853
For the marketing of non-banking financial products-	127,810	101,477
Investment funds	73,440	50,029
SICAVs	9,807	7,432
Pension funds	15,642	4,533
Insurance	28,408	39,257
Other (advisory services)	513	226
Other fees	42,260	38,812
Total fee income	365,298	313,082

30. Interest and similar charges/income

The breakdown of these items in the consolidated income statement, in accordance with the nature of the operations that give rise to the results, for the financial years ended 31 December 2014 and 2013 is as follows:

	€000s
Interest and similar income	2014	2013
Deposits at Banco de España (see Note 6)	443	1,417
Deposits with credit institutions (see Note 10)	7,321	10,268
Money market transactions through counterparties	2,363	3,027
Customer loans (see Note 10)	1,070,052	1,074,747
Debt instruments	287,349	358,858
Impaired assets	19,599	18,471
Income corrections from hedging operations	13,882	6,652
Income from insurance contracts linked to pensions and similar obligations	1,465	1,715
Other interest	1,847	1,075
	1,404,321	1,476,230

In 2014, the heading "Customer loans" (Note 10) includes €417.67 million corresponding to transactions with tangible security (€4445.72 million in 2013). The item "debt securities" includes, in 2014, €226.10 million corresponding to State Debt (€269.98 million in 2013).

	€000s
Interest expense and similar charges	2014	2013
On deposits at Banco de España	4,973	41,316
On deposits with credit institutions	124,621	128,098
On money-market transactions through counterparties	830	1,591
On customer loans	292,504	421,719
On debt represented by negotiable securities (see Note 19)	211,826	251,982
On subordinated liabilities (see Note 19)	30,560	32,820
Expense corrections from hedging transactions	(27,128)	(42,752)
Pension fund interest costs	1,462	1,660
Other interest	9,315	3,892
	648,963	840,326

The item "Debts represented by negotiable securities" (Note 19) includes in 2014 interest and charges on transactions with promissory notes and commercial paper to the value of €20.37 million (€38.56 million in 2013).

The average annual interest per item during financial years 2014 and 2013 was as follows:

	31/12/2014	31/12/2013
	Average	Average
	interest	interest
Similar income:
Deposits at central banks	0.10%	0.36%
Deposits with credit institutions	0.18%	0.47%
Loans and advances to customers (a)	2.67%	2.70%
Debt instruments	3.52%	3.23%
Similar costs:
Deposits from central banks	0.17%	0.58%
Deposits from credit institutions	1.82%	1.79%
Customer resources (c)	1.23%	1.73%
Customer deposits	1.02%	1.64%
Marketable debt securities	1.84%	1.97%
Subordinated liabilities	4.93%	4.62%

Indicated separately hereunder are the amounts of interest income and expense accrued in 2014 and 2013 in respect of financial assets not measured at fair value with changes through profit or loss:

	€000s
	2014	2013
Interest and similar income:	1,404,321	1,476,230
of which:
(a) Not measured at fair value with changes through profit and loss	1,331,610	1,409,052
(b) Measured at fair value with changes through profit and loss	72,711	67,178
Interest and similar expense	(648,963)	(840,326)
of which:
(a) Not measured at fair value with changes through profit and
loss	(572,560)	(776,446)
(b) Measured at fair value with changes through profit and loss	(76,403)	(63.80)

31. Trading income

The breakdown of these items in the consolidated income statement for the years ended 31 December 2014 and 2013 is as follows:

	€000s
	2014	2013
From financial assets and liabilities held for trading (Note 7)	14,982	18,163
From debt securities	24,676	21,822
Other equity instruments	2,642	14,758
Trading derivatives	(12,336)	(18,417)
Other financial instruments at fair value through profit and loss account (Note 7)	1,163	8,228
Other equity instruments	1,163	8,228
From financial assets available for sale (Note 8)	42,408	106,293
From debt securities	35,886	99,435
Other equity instruments	6,522	6,858
On financial liabilities at amortised cost	31,582	54,136
Debt instruments	6,895	38,360
Subordinated liabilities	1,322	5,777
Other subordinated liabilities	23,365	9,999
Other income and expense	(51)	1,844
	90,084	188,664

32. Exchange differences (net)

The amount of the net exchange differences recognised in the consolidated Income Statement for the year ended 31 December 2014 was €43.21 million (€40.09 million in the year ended 31 December 2013).

The breakdown by currency of the assets and liabilities in the Group's balance sheet denominated in foreign currencies as at 31 December 2014 and 2013 is as follows:

	€000s
	2014			2013
	Assets	Liabilities	Assets	Liabilities
US dollar	958,519	868,611	392,879	576,839
Sterling	77,363	46,821	95,592	51,080
Japanese yen	1,880,534	9,798	2,291,059	8,278
Swiss franc	629,004	5,719	661,605	5,083
Norwegian kroner	974	2,123	2,471	884
Swedish kronor	1,653	787	1,089	416
Danish kroner	1,174	273	85	2,115
Others	24,800	8,868	12,961	8,805
	3,574,021	943,000	3,457,741	653,500

33. Other general administrative expenses

The composition of the amounts included under this item in the consolidated income statement for financial years 2014 and 2013 is as follows:

	€000s
	2014	2013
Taxes	6,756	7,031
Buildings and supplies	32,355	32,353
Entertaining and travel expenses	5,779	4,607
Material and sundry expenses	13,218	12,672
External services	77,735	71,821
Software and communications	55,127	47,566
Advertising	68,639	59,312
Other expenses	27,126	24,564
	286,735	259,926

34. Other operating income and expense

The breakdown of this item in the consolidated income statement for the years ended 31 December 2014 and 2013 is as follows:

The breakdown of assets and liabilities denominated in foreign currencies as at 31 December 2014 and 2013 is as follows:

	€000s
	2014			2013
	Assets	Liabilities	Assets	Liabilities
Cash and balances at central banks	1,266		967	-
Held for trading	1,137	1,140	1,769	1,706
Loans and receivables	3,273,144		3,369,317	-
Financial assets available for sale	296,821		85,541	-
Accrued expenses and deferred income	1,583		40	-
Financial liabilities at amortised cost	-	936,704	-	651,766
Other	70	5,156	107	28
	3,574,021	943,000	3,457,741	653,500

	€000s
	2014		2013
	Income	Expenses	Income	Expenses
Income from the operation of investment property and other operating leases	6,866	-	6,536	-
Financial fees setting off direct costs	9,706	-	9,270	-
Contribution to the Deposit Guarantee Fund (Note 4)	-	44,911	-	75,629
Income and expense from/on insurance and reinsurance policies issued	651,549	362,487	652,217	380,758
Other	14,379	31,305	7,996	18,774
	682,500	438,703	676,019	475,188

The amount shown under "Contribution to the Deposit Guarantee Fund" is the result of the calculation made in accordance with the rules described in Note 4.

The item "financial fees setting off direct costs" contains the part of the fees that offset direct costs linked to investment products.

The amounts shown under the heading Income and Expense on insurance and reinsurance contracts issued correspond to the operating activity of Línea Directa Aseguradora.

35. Gains and losses in the derecognition of assets not classified as non-current assets held for sale and Profits and losses from non-current assets held for sale not classified as discontinued operations.

The breakdown of these items in the consolidated income statement for the years ended 31 December 2014 and 2013 is as follows:

	€000s
	2014	2013
Differences in the derecognition of assets not classified as non current assets held for sale:
Gains on disposal of tangible assets (Note 14)	21	9
Losses on disposal of tangible assets (Note 14)	(2,570)	(1,878)
Gains on disposal of shares	-	-
Gains on disposal of other equity instruments	-	21
Other items	(431)
	(2,980)	(1,848)
Gains / (Losses) on non-current assets held for sale not classified as discontinued operations:
Impairment losses on assets (see Note 12)	(12,249)	(42,348)
Gains on disposals	102,105	77,791
Losses on disposals	(144,570)	(128,234)
	(54,714)	(92,791)

36. Transactions and balances with related parties

The breakdown of transactions and balances with Group entities and other related entities and private individuals as at 31 December 2014 and 2013 is provided in Appendix I and the following Note 36.

37. Remuneration of and balances with members of the Board of Directors

Remuneration of the Board of Directors:

On 20 March 2014 Bankinter presented for consultative vote of the General Meeting of Shareholders its report on directors' remuneration, using the model established in CNMV Circular 4/2013 of 12 June, including information on its general policy in this area and its application in 2013 and the remuneration system applying to 2014. Although this report has been mandatory only since 2014, Bankinter has been presenting it to its AGM since 2008, in accordance with good corporate governance recommendations.

The report on directors' remuneration was approved by 96.512% (2013: 84.739%) of the total capital in attendance or duly represented at the aforementioned AGM. Among other information, it contained directors' remuneration both for their purely supervisory and collegiate decision-making functions as directors and for any executive or other functions performed for 2014, as listed and broken down in this note.

Directors' remuneration for the performance of their duties in their capacity as such:

According to Bankinter's Articles of Association, directors may receive remuneration by way of the following items for the performance of their functions purely as directors:

• A fixed annual amount,
• Fees for attending the meetings of the Board of Directors and of such Board Committees as they belong to,
• allocation of shares, stock options or remuneration linked to the share price.

The use of means of remuneration consisting in the allocation of shares, the granting of stock options or other means for which the law so provides shall require the prior approval of the General Meeting of Shareholders. The resolution of the General Meeting of Shareholders will state, where applicable, the number of shares to be allocated, the price for the exercising of the options and such other items as the Law may establish, and may be retroactively effective from the beginning of the financial year to which it refers.

The Board of Directors, at the proposal of the Remuneration Committee, will determine the specific amount that corresponds to each Director, conforming to the resolution of the General Meeting of Shareholders when legally required.

As regards the remuneration for the members of Bankinter's Board of Directors, the individual breakdown of the total remuneration received purely in their capacity as Directors (oversight and collegiate decision-making functions) during 2014 and 2013 is as follows:

		In euros
Directors	2014	2013
Pedro Guerrero Guerrero	206,800	209,880
María Dolores Dancausa Treviño	165,880	165,880
Cartival, S.A.	182,820	182,820
Marcelino Botín-Sanz de Sautuola y Naveda	84,275	92,436
Fernando Masaveu Herrero	121,141	123,585
John de Zulueta Greenebaum	127,178	123,481
Gonzalo de la Hoz Lizcano	130,134	122,003
Jaime Terceiro Lomba	155,883	154,405
María Teresa Pulido Mendoza (1)	39,685	-
Rafael Mateu de Ros Cerezo	158,101	181,544
Former directors (2)	48,831	118,973
	1,420,728	1,475,007

(1) María Teresa Pulido Mendoza was appointed a Director of Bankinter by cooptation on 23 July 2014. The 2015 General Meeting of Shareholders will be asked to ratify her appointment.

(2) In the category of former directors, the amounts shown in the table for 2014 and 2013 correspond to those received by José Antonio Garay Ibargaray, who ceased to be a Director of Bankinter on 21 March 2013, and by Pedro González Grau, who ceased to be a Director of Bankinter on 25 April 2014.

At year-end 2014 the number of Directors of Bankinter S.A. stood at ten, unchanged from the last two year-ends.

The aforementioned amounts, which as previously indicated are covered by the Articles of Association, include the following items for 2013 and 2014:

• a fixed amount,
• an amount that is accrued for attendance at meetings of the Board and its Committees (attendance fees), and
• allocation of shares in Bankinter S.A.

The following is a breakdown of the overall amounts shown in the previous table, by individual director in his or her capacity as such and by type of remuneration - fixed remuneration and fees for attending meetings of the Board of Directors and Board Committees in 2014 and 2013:

	In euros
	2014		2013
Directors	Fixed remuneration	Attendance Fees	Fixed remuneration	Attendance Fees
Pedro Guerrero Guerrero	72,160	90,640	72,160	93,720
María Dolores Dancausa Treviño	54,120	78,760	54,120	78,760
Cartival, S.A.	54,120	95,700	54,120	95,700
Marcelino Botín-Sanz de Sautuola y Naveda	36,080	26,195	36,080	34,356
Fernando Masaveu Herrero	36,080	63,061	36,080	65,505
John de Zulueta Greenebaum	36,080	69,098	36,080	65,401
Gonzalo de la Hoz Lizcano	36,080	72,054	36,080	63,923
Jaime Terceiro Lomba	36,080	97,803	36,080	96,325
María Teresa Pulido Mendoza (1)	16,400	13,600	-	-
Rafael Mateu de Ros Cerezo	36,080	100,021	46,904	106,040
Former directors (2)	13,120	23,200	36,080	60,832
Subtotals	426,400	730,132	443,784	760,562
Total	1,156,532		1,204,346

• (1) María Teresa Pulido Mendoza was appointed a Director of Bankinter by cooptation on 23 July 2014. The 2015 General Meeting of Shareholders will be asked to ratify her appointment.
• (2) In the category of former directors, the amounts shown in the table for 2014 and 2013 correspond to those received by José Antonio Garay Ibargaray, who ceased to be a Director of Bankinter on 21 March 2013, and by Pedro González Grau, who ceased to be a Director of Bankinter on 25 April 2014.

The individual breakdown of the allocations of shares to Directors in their capacity as such by way of remuneration for 2014 and 2013 is as follows:

	2014		2013
		Number of		Number of
Directors	Amounts	shares	Amounts	shares
	invested		invested
		Allocated		Allocated
Pedro Guerrero Guerrero	44,000	7,199	44,000	11,787
María Dolores Dancausa
Treviño	33,000	5,399	33,000	8,839
Cartival, S.A.	33,000	5,399	33,000	8,839
Marcelino Botín-Sanz de
Sautuola y Naveda	22,000	3,598	22,000	5,892
Fernando Masaveu Herrero	22,000	3,598	22,000	5,892
John de Zulueta Greenebaum	22,000	3,598	22,000	5,892
Gonzalo de la Hoz Lizcano	22,000	3,598	22,000	5,892
Jaime Terceiro Lomba	22,000	3,598	22,000	5,892
María Teresa Pulido
Mendoza (1)	9,685	1,499	-	-
Rafael Mateu de Ros Cerezo	22,000	3,598	28,600	7,660
Former directors (2)	12,511	1,285	22,061	5,912
	264,196	42,369	270,661	72,497

(1) María Teresa Pulido Mendoza was appointed a Director of Bankinter by cooptation on 23 July 2014. The 2015 General Meeting of Shareholders will be asked to ratify her appointment.

(2) In the category of former directors, the amounts shown in the table for 2014 and 2013 correspond to those received by José Antonio Garay Ibargaray, who ceased to be a Director of Bankinter on 21 March 2013, and by Pedro González Grau, who ceased to be a Director of Bankinter on 25 April 2014.

Loans and guarantees

Total loans granted to Directors as at 31 December 2014 amounted to €22.29 million (€26.18 million as at 31 December 2013). As at 31 December 2014 the Bank had outstanding guarantees in favour of its Directors for a total of €0.39 million (the same amount as at 31 December 2013).

The average term of the loans and lines of credit granted to the Bank's Directors was approximately 12 years in 2014 (11 years in 2013). The interest rates stand at between 0.70% and 4.57% in 2014 (1.06% and 4.54% in 2013).

Remuneration of the Chairman, the executive directors and senior management

As at 31 December 2014 the number of senior managers in the entity was seven, not including the Chairman or the executive directors. Taking this into account, the remuneration of Senior Management1 in 2014 was €2.73 million, of which €2.01 million was fixed and €0.71 million variable remuneration. In 2013, this amount stood at €2.05 million (seven persons).

In 2014 the following amounts, approved by the Board of Directors at the proposal of the Nominations and Remuneration Committee, were received by the Chairman of the Board of Directors for the performance of institutional non-executive functions additional to those of pure directorship, and by the executive directors as remuneration for their work.

Fixed remuneration:

• Pedro Guerrero Guerrero, Chairman of Bankinter, received a total of €0.60 million as fixed remuneration.
• Cartival, S.A., Executive Vice-chairman of Bankinter, received a total of €496,000 by way of fixed remuneration.
• María Dolores Dancausa Treviño, CEO of Bankinter, received a total of €667,000 by way of fixed remuneration.

Variable remuneration

The system of annual variable remuneration applying to executive directors and senior management is the same as that applying to the rest of the Bankinter Group's workforce that receive this type of remuneration. The Chairman does not receive variable remuneration.

This annual variable remuneration is linked to the attainment of the pre-tax profit objective for the Group's banking activity, as approved by the Board of Directors on the proposal of the Appointments and Remuneration Committee (now the Remuneration Committee). Each Director is assigned an amount that will be received if the objective is fully achieved. However, this variable incentive starts to accrue from an 80% achievement of the objective and up to a maximum of 120%, such that directors may receive between 70% and 120% of the variable amount assigned to each, depending on the degree of achievement. The attainment rate in 2014 was 120% (2013: 100.1%).

In the case of the executive directors (executive Vice-chairman and CEO), the Board of Directors approved, at the proposal of the Appointments and Remuneration Committee, the application of certain measures in respect of variable remuneration accrued since 2011, in accordance with Royal Decree 771/2011 of 3 June, and more specifically (i) deferral of 40% of the accrued incentive over three years, linearly and (ii) payment of 50% of the total incentive in the form of shares in the Bank.

¹ "Senior management" means managers reporting directly to the Board or the executive Directors.

The latter measure was conditional, in the case of the executive directors, on approval by the Bankinter AGM of the year following accrual, as required by Article 219 of the Corporate Enterprises Act. The 2014 AGM approved remuneration of executive directors consisting in the allocation of shares as part of their variable remuneration in 2013, with 98.026% of capital present or duly represented voting in favour (99.648% in 2012). During 2014 the shares corresponding to the deferral of the variable remuneration accrued for 2011, 2012 and 2013 were delivered to the executive Directors, in accordance with the details of the resolutions passed by the General Meeting of Shareholders held in 2012, 2013 and 2014 respectively. The following are the details of the deliveries made during 2014:

	Delivery of shares corresponding to variable		Delivery of shares corresponding to variable		Delivery of shares corresponding to variable
		remuneration accrued in 2011 (13.33%)		remuneration accrued in 2012 (13.33%)		remuneration accrued in 2013 (13.33%)
CEO	Unit price assigned to		Unit price assigned to		Unit price assigned to
	each share1	In shares	each share2	In shares	each share3	In shares
CARTIVAL	3.1059855	8,628	2.605153847	7,179	5.46476923	2,747
María Dolores
3.1059855 Dancausa Treviño	8,628	2.605153847	9,572	5.46476923	3,663

¹ Average listed price of Bankinter stock at close of business on each of the trading sessions held between 2 January and 20 January 2012, (the initial price was €4.831533, but following the adjustment for the capital increase by way of bonus issue in April 2013, the new value is €3.1059855).

2 Average listed price of Bankinter stock at close of business on each of the trading sessions held between 2 January and 20 January 2013, (the initial price was €4.0524615, but following the adjustment for the capital increase by way of bonus issue in April 2013, the new value is €2.605153847).

3 Average listed price of Bankinter stock at close of business on each of the trading sessions held between 2 January and 20 January 2014.

The Board of Directors also approved, at the proposal of the Appointments and Remuneration Committee (now the Remuneration Committee) the application of the aforementioned measures to the annual variable remuneration for 2014 accrued by the executive directors, the allocation of shares accordingly being subject to approval by the 2015 AGM.

The following are the amounts accruing during 2014 to the executive directors of the company.

As previously indicated, the attainment rate as regards variable remuneration for 2014 was 120%, which led to the accrual of variable incentives of €180,000 for the executive Vice-chairman and €254,400 for the CEO, which will be paid as follows:

• In cash, 50% of the variable remuneration accrued in respect of variable incentive for 2014: Vice-chairman of the Board: €90,000 and CEO: €127,200.
• In shares (subject to approval by the General Meeting of Shareholders as previously indicated):
• 10% of the variable remuneration accruing in 2014: 6,618 shares (2,742 to the executive Vice-chairman and 3,876 to the CEO), at a price of €6.56261538 per share2. If the allocation of shares referred to above is approved by the 2015 AGM, the shares will be delivered within five stock exchange trading days of approval.
• The remaining 40% of the annual variable remuneration for 2014 will also be paid in shares. Since the reference share price used to obtain the number of shares to be allocated is the same as that previously indicated (€6.56261538 per share), the numbers of shares to be received in the coming years are as follows:
• Executive Vice-chairman:

• 3,657 shares will be delivered in the month of January 2016. 3,657 shares will be delivered in the month of January 2017. 3,657 shares will be delivered in the month of January 2018.

• Managing Director:

• 5,168 shares will be delivered in the month of January 2016.
• 5,168 shares will be delivered in the month of January 2017.
• 5,168 shares will be delivered in the month of January 2018.

In short, the sum of amounts accrued by the Chairman over and above those for purely being a director, and by the executive directors for their respective services, was €2.2 million (not including payment in kind of €15,000 received by the Chairman and the CEO). In 2013 the amount was €1.98 million. The increase is mainly due to the greater degree of attainment of the main objective to which the variable remuneration of executive directors (executive Vice-chairman and CEO) is linked, as previously remarked, which is equally reflected in the variable remuneration paid to other employees of the Bank who are paid on this basis.

Bankinter has decided to apply the aforementioned principle of deferred payment and payment in shares to annual variable remuneration from 2012 onwards of members of Senior Management as referred to in this report, among others.

Bankinter has no pension commitments to its external or non-executive Directors, nor does it have commitments to its executive directors that are either new or different from those already mentioned in the Remuneration Reports for previous years. Bankinter has no commitments to its executive directors or to members of Senior Management in respect of pensions or other than already mentioned in the Reports on Directors' Remuneration of previous years.

Bankinter has not agreed "golden parachute" clauses in its administration contracts with any of its executive directors, or in its provision of services contract with the Chairman, linking the accrual of financial rights to situations of change of control of the Bank (which are common clauses in these types of contracts), as indicated in the report on directors' remuneration which will be submitted to a consultative vote at the 2015 General Meeting of Shareholders, as last year.

² the average closing price of Bankinter shares between 2 January and 20 January 2015 inclusively.

Bankinter has not agreed "golden parachute" clauses in its management contracts with any of the members of its Senior Management linking the accrual of financial rights to situations of change of control of the Bank (which are common clauses in these types of contracts and are in fact envisaged by Royal Decree 1382/1985 regulating the special labour relations of senior management.)

Summary of Directors' remuneration, loans, and other benefits for Directors

Remuneration by type

	€000s
	2014(*)
Fixed remuneration (1)	1,766
Variable remuneration (2)	434
Attendance fees (3)	730
Directors' Fees (4)	690
Options on shares and/or other financial instruments	-
Other	-
	3,620

(*)not including remuneration in kind received by the Chairman and the CEO (€15,000)

• (1) Fixed remuneration corresponding exclusively to executive directors in their capacity as executives and to the Chairman of the Board.
• (2) Variable remuneration corresponding solely to executive directors in their capacity as executives, being the annual variable remuneration accrued in 2014, linked to the achievement of a specific pre-tax profit objective for the Group's banking activity in 2014. Each executive Director was assigned an amount that he or she would receive if the objective was achieved, as explained in the heading "Remuneration of the Chairman, Executive Directors and Senior Management". The attainment rate in 2014 was 120%. Purely for purposes of clarification, the Chairman receives no variable remuneration.
• (3) Attendance fees for Board and Committee meetings (Directors).
• (4) Comprises directors' fixed remuneration plus free allocation of shares (for their functions purely as directors)

Remuneration by type of director including all items

		€000s
	2014
Type of Director	By Company1	By Group (**)
Executives (*)	1,945	-
External Proprietary Directors	205	-
External Independent Directors	660	27
Other External (***)	810	-
	3,620	27

(1)not including remuneration in kind received by the Chairman and the CEO (€15,000)

(*) The following are executive directors: CARTIVAL, S.A., executive Vice-chairman, and María Dolores Dancausa Treviño, CEO.

(**) During 2014 Mr. Gonzalo de la Hoz Lizcano and Mr. Rafael Mateu de Ros, in their capacity as non-executive directors, received €12,000 and €7,500 respectively by way of attendance fees for meetings of the Board of Directors of Línea Directa Aseguradora, S.A. The amount received by Mr. Gonzalo de la Hoz Lizcano includes fees both as a member of the Board of Directors and as a member of the Control Committee of LDA. Additionally, Mr. Gonzalo de la Hoz Lizcano is the Chairman of Gneis Global Services, S.A., the Group's technology and operating services company, and during 2014 he received €7,200 by way of fees for attending meetings of the Board of Directors.

(***) The Chairman, Pedro Guerrero Guerrero, is classified as "other external".

Other benefits

	€000s
Advances	-
Loans granted	-
Pension Funds and Plans: Contributions	-
Pension Funds and Plans: Contractual obligations	600
assumed
Life insurance premiums	0.8
Guarantees set up by the company in favour of directors	-

Transactions with Members of the Board of Directors

In relation to transactions involving a transfer of resources or obligations between the Company and entities belonging to the Group and the Directors of Bankinter, S.A., its significant shareholders, directors and related parties, in significant amounts, outside the scope of Bankinter S.A.'s ordinary operations or not carried out on normal market terms, please refer to section D (related party transactions) in the Annual Corporate Governance Report for 2014.

Article 229 of the Corporate Enterprises Act establishes that directors must inform the Board of Directors of any situation of conflict, direct or indirect, that they or persons related to them may have with the interests of the company. None of the members of the Board of Directors has reported a situation of conflict of interest as defined in Article 229 of the Corporate Enterprises Act, which is hereby expressly stated pursuant to section three of the aforementioned Article.

Directors' holdings in the share capital

In compliance with Law 26/2003 of 17 July amending Law 24/1988 of 28 July on the Securities Market and the Corporate Enterprises Act, the Entity is obliged to provide information on the holdings of the Directors of Bankinter, S.A. in the company's share capital.

The breakdown of the interests held by the members of the Board of Directors as at 31 December 2014 and 2013 is as follows:

	31/12/2014 (3)		31/12/2013 (4)
	Total Shares	% holding	Direct	Indirect	Total Shares	% holding	Direct	Indirect
Pedro Guerrero Guerrero	3,359,133	0.374	3,084,128	275,005	5,231,528	0.584	4,876,523	355,005
María Dolores Dancausa Treviño	1,137,190	0.127	1,136,922	268	1,287,225	0.144	1,286,756	469
Cartival, S.A.	204,706,145	22.774	204,706,145	-	204,681,888	22.855	204,681,888	-
Marcelino Botín-Sanz de Sautuola y Naveda	252,201	0.028	252,201	-	248,400	0.028	248,400	-
Fernando Masaveu Herrero	47,551,881	5.290	775,484	46,776,397	47,390,080	5.292	771,683	46,618,397
John de Zulueta Greenebaum	228,804	0.023	228,804	-	250,003	0.028	250,003	-
Gonzalo de la Hoz Lizcano	453,762	0.050	453,762	-	661,461	0.074	661,461	-
Jaime Terceiro Lomba	50,638	0.006	50,638	-	46,837	0.005	46,837	-
María Teresa Pulido Mendoza (1)	665	0.000	665	-	-	-	-	-
Rafael Mateu de Ros Cerezo	1,095,877	0.122	1,095,877	-	1,449,762	0.162	1,449,762	-
Former director (2)	-	-	-	-	49,692	0.006	49,692	-
Totals	258,836,296	28.794	211,759,626	47,051,670	261,296,876	29.178	214,323,005	46,973,871

1) María Teresa Pulido Mendoza was appointed a director of Bankinter on 23 July 2014.

• 2) In the category of former directors, the amounts in the table for 2013 correspond to Pedro González Grau, who ceased to be a director of Bankinter on 25 April 2014.
• 3) The capital of Bankinter as at 31 December 2014 is represented by a total of 898,866,154 shares.
• 4) The capital of Bankinter as at 31 December 2013 is represented by a total of 895,583,800 shares.

38. Environmental information

As part of the Bankinter Group's firm commitment to carrying on its activity and business in compliance with the strictest Corporate Responsibility criteria, in 2012 it published the principles of its Sustainability Policy, which serves as an action framework for integrating environmental, social and ethical criteria into its management model.

The Sustainability Committee, led by the Chairman of the Board, is the body charged with overseeing compliance with the principles embodied in this Sustainability Policy. It is also responsible for defining the strategy and developing the objectives contained in the multi-year management programme.

In 2014 the Bank continued to develop the strategic lines defined in the 'Noughts and Crosses' Sustainability Plan, the objective of which is to integrate the Bank's economic, social and environmental dimensions transversally into its business model.

The Plan was drawn up on the basis of detecting the aspects of the banking activity that have an impact on the economic, social and environmental milieu, with the aim of minimising the negative and maximising the positive ones.

Prior to its preparation an analysis was carried out of the changes occurring in the Group's most immediate economic, social and environmental milieu.

The Plan's design was inspired by recognised standards such as the ISO 26000 corporate responsibility guidance and Forética's SGE21, and follows recommendations of international bodies such as the sustainability rating agencies and corporate responsibility observatories.

All the actions defined and implemented in the Plan are considered from three perspectives:

– Economic, embodying strategies focused on promoting and supporting innovative entrepreneurship, such as the Entrepreneurship project, and the development of Socially Responsible Investment, which incorporates ESG (Environmental, Social and Governance) principles into the Bank's investment and financing policies.

• Social, through the 'A Bank for All' project, the main objective of which is to develop an inclusive bank that is fully accessible to people with disabilities, by removing physical, cognitive and technological barriers.
• The environmental perspective, with the implementation of measures aimed at reducing the direct and indirect environmental impact of its activity, in which commitment it involves strategic stakeholder groups such as employees, customers and suppliers, shareholders and investors.

This Bankinter Sustainability Plan relies on four basic pillars for its implementation:

• Quality, its people's commitment to excellence in the provision of services and attention to customers' financial needs.
• The management systems, with tools for continuously improving economic, social and environmental performance, which moreover have been externally audited and certified in accordance with internationally recognised standards.
• The involvement of its strategic stakeholder groups, especially its employees, through training and awareness programmes and their participation in volunteer actions.
• The use of the best technology available and the most innovative solutions as defining features of the Bank.

The Sustainability department reports to the Chairman's Office and the People Management and Corporate Communication area, which in turn reports to the CEO.

Bankinter is a member of the Spanish Network of the United Nations Global Compact, and as such assumes the commitment to incorporate its ten principles of conduct and action in the field of human, labour and environmental rights and the fight against corruption. Bankinter is also a member of Forética, an association of Spanish companies whose mission is to promote a culture of ethical business management.

Additionally, Bankinter is a collaborating company in the Fundación Lealtad, a nonprofit institution whose mission is to promote Spanish society's confidence in NGOs so as to achieve an increase in donations and in any other kind of collaboration with the non-profit and voluntary sector.

The Bank's sustainable management was recognised in 2014 by socially responsible investment indices such as FTSE4Good and MSCI, and environmental management rankings such as the Carbon Disclosure Project, together with major world companies by capitalisation.

During the financial year, it was not considered necessary to recognise any allocation for environmental risks and liabilities as there were no contingencies linked to environmental protection and enhancement and no sanction or fine was imposed in relation to the environmental management carried out by the Bankinter Group. The Directors of the Group consider that the environmental risks inherent to its activities are minimal and adequately covered, and do not believe it is exposed to any additional liabilities in relation to such risks. Neither has the Group incurred any expenses or received any subsidies linked to these risks.

39. Customer service

Article 17 of Order 734/2004 of 11 March of the Ministry of Economy on customer service departments and services and ombudsmen at financial institutions stipulates, inter alia, that financial institutions are required to prepare a report on the activities performed by these services in the preceding financial year and, also, to include a summary of this report in the notes to their financial statements.

The Activities Report for 2014 drawn up by the Customer Support Service, which will be presented at the meeting of the Board of Directors on 17 February 2015, indicates that during 2014 the number of complaints/claims again fell, to 2.19 per million transactions (compared with 3.13 the year before).

The number of complaints and claims handled by the Customer Service department in 2014 fell by 13.67% compared with 2013, to 5,083. Claims of a financial nature numbered 4,121, of which 52.8 % were resolved in the customer's favour.

Annual	2014	2013
TOTAL COMPLAINTS AND CLAIMS
Total number of complaints	962	1,531
Total number of claims	4,121	4,247
Total claims and complaints	5,083	5,778
FINANCIAL CLAIMS	2,176	1,918
In the customer's favour	52.8%	45.16%
	1,945	2,329
In the Bank's favour	47.2%	54.84%
Total financial claims	4,121	4,247

As regards the timeframe for dealing with these complaints, in 2014 47.6% of incidents were answered in less than 48 hours (similar to the previous year, 47.8%).

Resolution times, compared with previous year.

	2014			2013
Timeframes	Problems		Problems
0 days	1,443	28.4%	1,681	29.09%
1 to 2 days	976	19.2%	1,081	18.71%
3 to 6 days	916	18.0%	1,136	19.66%
7 to 10 days	438	8.6%	492	8.52%
> 10 days	1,310	25.8%	1,388	24.02%
	5,083	100.0%	5,778	100.00%

The External Ombudsman dealt with 397 incidents in 2014, 74.8% fewer than in 2013. Of these, 217 were resolved in the customer's favour. Claims settled in the Bank's favour numbered 150.

External Ombudsman.	2014	2013	Change
Incidents processed	397	694	(74.8%)
Settled in the customer's favour	217	423	(94.9%)
Settled in the Bank's favour	150	240	(60.0%)
Excluded	30	31

Incidents handled through Banco de España in 2014 numbered 218.

The number of incidents resolved by Banco de España in the period was 66, of which 15 in the Bank's favour.

Bankinter Group	2014	2013	Change
Bank of Spain:
Claims processed	218	324	-48.6%
In the customer's favour	23	73	-217.4%
Uncontested	28	27	3.6%
In the Bank's favour	15	26	-73.3%
Pending settlement	144	169	-17.4%
Outside Bank of Spain jurisdiction	_	_
Filed	8	29	-262.5%

No recommendations were issued in the Activities Report for 2013 drawn up by the Customer Support Service.

40. Branches, centres and agents

The breakdown of the Bankinter, S.A. branch offices, centres and agents as at 31 December 2014 and 2013 is as follows:

	31/12/2014	31/12/2013
Branch Offices	360	360
Commercial management centres
Corporate	49	48
SMEs	78	75
Private Banking and Personal Finance	39	36
Virtual Offices	398	369
Number of Agents	469	469
Telephone and Internet branches	3	3

As at 31 December 2014, Bankinter, S.A. had a network of 469 agents (unchanged from 2013), composed of individuals or legal entities who have been granted powers to deal with the Bank's clients on its behalf in negotiating and completing transactions typical of a credit institution. This network handled customer deposits of €1.19 million as at 31 December 2014 (€0.97 million as at 31 December 2013), with average lending of €1.61 million (€1.70 million as at 31 December 2013). The list of agents is registered with the Financial Institutions Office of Banco de España. EAFIs ("Empresas de Asesoramiento Financiero" or Financial Advisory Companies), of which there were 43 as at 31 December 2014, are governed by the Stock Exchange Act, by Royal Decree 217/2008, of 15 February, on the legal regime of investment service companies and, in particular, Circular 10/2008, of 30 December, of the CNMV, the Spanish securities regulator, on EAFIs.

41. Trust and investment services

The following table details the fees recorded in financial years 2014 and 2013 for the activities of investment services and complementary activities provided by the Group:

	€000s
	2014	2013
For securities services-	70,747	49,455
Underwriting and placement of securities	2,654	1,248
Sale and purchase of securities	31,476	22,906
Administration and custody of securities	25,008	19,447
Wealth management	11,609	5,853
For the marketing of non-banking financial products-	127,810	101,478
Investment funds	73,440	50,029
SICAVs	9,807	7,432
Pension funds	15,642	4,533
Insurance	28,408	39,257
Other (advisory services)	513	226
Total fee income	198,557	150,933

Shown hereunder are the assets of the investment funds, pension funds, customer portfolios and SICAVs managed by the Group and third-party investment funds marketed:

	€000s
	31/12/2014 31/12/2013
Own investment funds	7,233,279	5,998,747
External investment funds sold	3,812,032	1,966,424
Pension funds	1,936,084	1,650,496
Wealth management and SICAVs	3,862,604	2,359,200
	16,843,999	11,974,867

42. Auditors' remuneration

Set forth below are the fees for professional services incurred by the auditors of the individual and consolidated Annual Accounts for the Bank and the Group during financial years 2014 and 2013:

	€000s
	Bankinter, S.A. Bankinter			Group
	2014	2013	2014	2013
Auditing services	414	358	829	770
Audit-linked services	365	239	365	241
Tax services	-	-	-	-
Other services	143	100	143	181
	922	697	1,337	1,192

The amount stated in the above table for auditing services includes all fees relating to auditing for the financial years 2014 and 2013, irrespective of when they were invoiced.

43. Tax situation

Profit, which is calculated in accordance with tax legislation, is subject to a 30% levy on the taxable base. Certain deductions can be made from the resulting amount.

The fact that a consolidated return is filed for Corporation Tax does not mean that the Corporation Tax payable by each Entity is substantially different from what it would be if assessed on an individual basis.

On 27 December 2000, the Bank notified the National Inspection Office at the Spanish Inland Revenue Authorities of its decision to apply the fiscal consolidation regime from financial year 2001 onwards. The Fiscal Group number allocated by the National Inspection Office at the Spanish Inland Revenue Authorities was 13/2001.

The list of subsidiary companies in the Bankinter tax group as at 31 December 2014 is as follows:

Bankinter Consultoría, Asesoramiento, y Atención Telefónica, S.A.
Bankinter Gestión de Activos, S.A., S.G.I.I.C. (formerly Gesbankinter, S.A.)
Hispamarket, S.A.
Intermobiliaria, S.A.
Bankinter Emisiones, S.A.
Bankinter Consumer Finance, E.F.C., S.A.
Bankinter Capital Riesgo, S.G.E.C.R., S.A.
Bankinter Sociedad de Financiación, S.A.
Arroyo Business Consulting Development, S.L.
Gneis Global Services S.A.
Relanza Gestión, S.A.
Línea Directa Aseguradora, S.A.
Línea Directa Asistencia, S.L.U.
Motoclub LDA. S.L.U.
Centro Avanzado de Reparaciones CAR, S.L.U.
Ambar Medline, S.L.
LDActivos, S.L.U.
Naviera Goya S.L.U.
Naviera Sorolla S.L.U.
Mercavalor S.A.

There follows below a reconciliation of the consolidated accounting profit and tax profit for years 2014 and 2013:

€000s
	31/12/2014	31/12/2013
Accounting profit before tax for the financial year	392,839	297,566
Permanent differences-	(11,457)	(26,470)
Application of prior years' tax losses	(864)	(401)
Profits (losses) of entities accounted for using the equity
Holding	(16,962)	(15,545)
Others	6,369	(10,524)
Accounting Base for Tax	381,382	271,096
Temporary differences	66,943	(9,237)
Tax Base	448,325	261,859

The positive temporary differences in 2014 are essentially due to adjustments for non tax-deductible provisions. The negative temporary differences mostly consist of differences due to reversals of adjustments for provisions and other non-taxdeductible items in previous financial years.

The expenditure in the year for Corporation Tax for financial years 2014 and 2013 is calculated as follows:

	€000s
	2014	2013
Expenses corresponding to current financial year	114,415	81,329
Deductions and allowances	(10,514)	(4,950)
Other items (*)	12,865	6,303
Tax adjustments from previous financial years	185	(540)
	116,951	82,143

The item 'Tax adjustments from previous years' in 2014 states expenditure for Corporation Tax caused by tax adjustments carried out in the settlement of the Group's Corporation Tax corresponding to financial year 2013 not envisaged as at 31 December 2013.

Current tax expense for the year and the amount of deferred tax expense (income) for 2014 and 2013 are as follows:

	€000s
	31/12/2014	31/12/2013
Current expense (Taxable profit x 30% minus deductions and adjustments for deferred tax)	137,034	79,372
Deferred tax expense	(20,082)	2,771
Total tax expense	116,952	82,143

The following is the reconciliation of the profit before tax with the tax expense for the financial year:

	€000s
	2014	2013
Pre-tax accounting profit	392,839	297,566
Tax at 30%	117,852	89,270
Breakdown of items to reconcile tax expense
at the tax rate and Corporation Tax expense for the year:
Non-deductible expenses	2,384	609
Non-computable income	(5,562)	(9,673)
Total deductions applied in the financial year	(10,514)	(4,950)
Negative tax bases	(259)	(120)
Others:
Corporate Tax adjustment from the previous financial year	185	(540)
Other	12,865	7,547
Corporate Tax expenditure for the financial year	116,951	82,143
Effective tax rate for the year	29.77%	27.60%

The amounts shown in the foregoing table corresponding to 2013 are those presented in the annual report for 2013. (If it had been adjusted for the change in accounting principle indicated in Note (2), the amount of income tax expense for 2013 and the pre-tax profit would have been €71.20 million and €261.10 million respectively.

Income tax expense for the year is calculated by adding the current tax resulting from applying the tax rate to the tax base for the financial year, after applying admissible deductions, plus the change in tax assets and liabilities due to taxes paid in advance and deferred and tax credits, both due to negative tax bases and deductions.

Deferred tax assets and liabilities include the temporary differences that are identified as the amounts that are expected to be payable or recoverable due to the differences between the carrying amounts of assets and liabilities and their tax value, as well as negative tax bases pending offset and credits for tax deductions not yet applied. These amounts are recognised by applying to the temporary difference or credit in question the rate at which they are expected to be retrieved or settled.

Liabilities are recognised due to deferred taxes for all of the taxable temporary differences, except in general if the temporary difference derives from the initial recognition of goodwill. Deferred tax assets identified with temporary differences are recognised only if it is considered probable that the consolidated entities will in future have sufficient taxable profits against which to realise them. The remaining deferred tax assets (negative tax bases and deductions pending offset) are recognised only if it is considered probable that the consolidated entities will in future have sufficient taxable profits against which to realise them.

On the occasion of each accounting closure, the deferred taxes recognised are reviewed (both assets and liabilities) with a view to ensuring that they remain valid, with any necessary corrections to same being made in accordance with the results of the tests performed.

On 9 April 2014 Bankinter was informed by the tax authorities of a partial inspection, limited to IRPF (PAYE, income tax retentions on salary payments) for amounts paid in 2010 to 2012, as a result of which we signed a deed of disagreement on 13 November 2014, and as at 31 December 2014 we had yet to receive the settlement agreement. Also, on 25 September 2014 a similar inspection was started with group company Gneis, S.A.

As regards the remaining procedures deriving from tax inspections in previous years, those corresponding to the general inspection of 2007 and 2009, as well as those corresponding to the general inspection of 2004 to 2006 which are pending resolution, have been appealed before the TEAC Central Administrative Economic Tribunal, while those corresponding to the general inspection of 2001 to 2003, pending resolution, are still in appeal before the National Court.

In any case, the tax liabilities that might derive from the appeals lodged against the disputed assessments were adequately provided for as at the end of 2014 and preceding financial years. Due to the possible interpretations of the tax regulations that apply to certain transactions carried out in the banking sector, there may be certain tax liabilities of a contingent nature. The Bank considers that the possibility of these contingent liabilities becoming actual liabilities is remote and that, in any case, the tax charge which would arise would not materially affect the consolidated annual financial statements.

The details of the deferred tax assets and liabilities that Bankinter's Administrators expect to be reversed in future financial years are as follows:

The various tax credits applied in the calculation of the Corporate Tax payable for the Group in financial years 2014 and 2013 are shown in the following table:

	€000s
	31/12/2014	31/12/2013
Deferred tax assets (Note 17)	143,878	132,300
Less than 10 years:
Impairment of property assets	56,535	64,665
Provisions for real estate promoter risk	-	-
Other provisions and accruals	72,593	53,816
Impairment in holdings	6,023	2,740
Early retirement fund	-	212
Software	46	43
Loan fees	1,562	1,858
Other	7,502	5,408
Available-for-Sale Portfolio	180	2,235
Consolidation adjustments	(563)	1,323
Deferred tax liabilities (Note 17)-	177,362	149,647
Less than 10 years
Available-for-Sale Portfolio	53,703	20,555
Intra-group sales	10,107	12,525
Other	23,615	22,080
Consolidation adjustments	41,668	45,404
Of which:
Revaluation of Assets of Línea Directa Aseguradora, S.A.	33,406	40,167
More than 10 years:
Revaluation of buildings	48,269	49,083

	€000s
	31/12/2014	31/12/2013
Applied to the tax base:
Exemption from ETVE (Spanish holding company) regime	(333)	11,119
Allocation of negative tax bases from economic interest groupings	1,379	3,992
	1,046	15,111
Applied to the tax due:
Deductions for double taxation	8,747	743
Deduction for ID/IT	1,165	1,146
Deduction for reinvestment of extraordinary profits		2,105
Deduction for donations to institutions	602	454
Deduction for film productions		502
	10,514	4,950

There was no income covered by the deduction for re-investment of extraordinary income in 2014 (€17.54 million in 2013 and zero in 2012), the Bank having met the reinvestment requirements established in Article 42 of Legislative Royal Decree 4/2002 of 5 March approving the consolidated text of the Corporation Tax Act.

As regards income eligible for deduction for reinvestment in 2013, its reinvestment was totally carried out in the same year 2013 with Bankinter's acquisition of 100% of Van Lanschot Bankiers Luxembourg S.A. for €21.5 million, 100% of Mercavalor S.A. for €1.5 million and various acquisitions of investment property and other fixed assets by the Bankinter Group.

During 2005 the Bank opted to apply the tax regime applicable to institutions holding foreign securities as regulated in chapter XIV of Title VII of Royal Legislative Decree 4/2002 of 5 March approving the revised text of the Corporation Tax Act, the competent body of the Spanish Inland Revenue being notified of this decision on 21 April 2005.

In accordance with the provisions of Article 118.3 of this revised text, we report that during 2014 the Bank obtained capital gains of €1.51 million (€10.48 million in 2013) and received dividends amounting to €1.03 million (€2.21 million in 2013), and that €0.16 million (€0.44 million in 2013) were paid in foreign tax on said dividends.

44. Fair value of assets and liabilities

a) Fair value of financial instruments

The following is a breakdown of the fair value of financial instruments and the

procedure used to obtain the price:

	Carrying amount	Fair value	Fair value hierarchy	Fair value	Valuation techniques	Main inputs
1. Cash and balances at central banks	357,327	357,327	Level 2		357,327 Present value	Expected cash flows discounted at market rates
Held for trading
2.1. Deposits with credit institutions	544,528	544,528	Level 2		544,528 Calculation of prices from market inputs and explicit formulas	Interest rate curves and fixing of interest rate
2.2. Loans and advances to customers	1,967,180	1,967,180	Level 2		1,967,180 Calculation of prices from market inputs and explicit formulas	Interest rate curves and fixing of interest rate
2.3. Debt instruments	2,345,496	2,345,496	Level 1		2,345,496 Direct capture of quoted market prices	Observable market data
			Level 1		59,320 Direct capture of quoted market prices	Observable market data
2.4. Equity instruments	59,320	59,320	Level 1		5,295 Direct capture of quoted market prices	Observable market data
			Level 2		2,423 Calculation of prices from market inputs and explicit formulas	- equity fixing, volatility, - interest rate curves and EURIBOR fixing
			Level 2		10,404 Calculation of prices from market inputs and explicit formulas	equity fixing, volatility
2.5. Trading derivatives	436,958	436,958	Level 2		54,644 Calculation of prices from market inputs and explicit formulas	fixing of currency, interest rate curves
			Level 2		512 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
			Level 2		192,333 Calculation of prices from market inputs and explicit formulas	fixing of equity, volatility, interest rate curves and fixing
			Level 2		171,347 Calculation of prices from market inputs and explicit formulas	fixing of currency, interest rate curves
Other financial assets at fair value through profit or loss
3.4. Equity instruments	49,473	49,473	Level 1		49,473 Direct capture of quoted market prices	Observable market data
Financial assets available for sale
			Level 1		1,837,738 Direct capture of quoted market prices	Observable market data
4.1. Debt instruments	2,845,308	2,845,308	Level 2		1,007,570 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
			Level 1		87,645 Direct capture of quoted market prices	Observable market data
4.2. Equity instruments	126,295	126,295	Level 2		38,650 Calculation of prices from market inputs and explicit formulas	Expected cash flows discounted at market rates
4.3. Equity instruments valued at cost	42,210
Loans and receivables
5.1. Deposits with credit institutions	1,113,441	1,113,597	Level 2		1,113,597 Present value	Expected cash flows discounted at market rates
5.2. Loans and advances to customers	42,446,723	43,047,345	Level 2		43,047,345 Present value	Expected cash flows discounted at market rates
5.3. Debt instruments	446,357	523,800	Level 2		523,800 Present value	Expected cash flows discounted at market rates
Held to maturity investments
6. Held to maturity investments	2,819,482	3,290,053	Level 1		3,290,053 Direct capture of quoted market prices	Observable market data
Hedging derivatives
7. Hedging derivatives	148,213	148,213	Level 2		148,213 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing

LIABILITIES	Carrying amount	Fair value	Hierarchy	Fair value	Valuation techniques	Main inputs
Held for trading
1.3. Deposits from credit institutions	270,621	270,621	Level 2		270,621 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
1.3. Customer deposits	451,559	451,559	Level 2		451,559 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
			Level 1		11,569 Direct capture of quoted market prices	Observable market data
			Level 1		6,171 Direct capture of quoted market prices	Observable market data
1.5. Trading derivatives	322,598	322,598			15,644 Calculation of prices from market inputs and explicit formulas	equity fixing, volatility,
			Level 2		52,090 Calculation of prices from market inputs and explicit formulas	currency fixing
					552 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
					41,330 Calculation of prices from market inputs and explicit formulas	interest rate curves and currency fixing
					195,242 Calculation of prices from market inputs and explicit formulas	interest rate curves and equity fixing
1.6. Short positions in securities	1,396,713	1,396,713	Level 1		1,396,713 Direct capture of quoted market prices	Observable market data
Financial liabilities at amortised cost
3.1. Deposits from central banks	3,240,433	3,233,433	Level 2		3,233,433 Present value	Expected cash flows discounted at market rates
3.2. Deposits from credit institutions	5,249,425	5,365,896	Level 2		5,365,896 Present value	Expected cash flows discounted at market rates
3.3. Customer deposits	29,966,129	30,089,543	Level 2		30,089,543 Present value	Expected cash flows discounted at market rates
3.4. Marketable debt securities	9,311,034	9,788,981	Level 2		9,788,981 Present value	Expected cash flows discounted at market rates
3.5. Subordinated liabilities	608,198	771,154	Level 2		771,154 Present value	Expected cash flows discounted at market rates
3.6. Other financial liabilities	1,615,461	1,615,461	Level 2		1,615,461 Present value	Expected cash flows discounted at market rates
Hedging derivatives
4. Hedging derivatives	20,241	20,241	Level 2		20,241 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing

2013:

	Carrying amount	Fair value	Fair value hierarchy		Fair value	Valuation techniques Main inputs
1. Cash and balances at central banks	886,118	886,118	Level 2			886,118 Present value Expected cash flows discounted at market rates
Held for trading
2.1. Deposits with credit institutions	920,112	920,112	Level 2			920,112 Calculation of prices from market inputs and Interest rate curves and fixing of interest rate explicit formulas
2.2. Loans and advances to customers	979,439	979,439	Level 2			979,439 Calculation of prices from market inputs and Interest rate curves and fixing of interest rate explicit formulas
2.3. Debt instruments	1,736,670	1,736,670	Level 1			1,736,670 Direct capture of quoted market prices Observable market data
			Level 1			66,662 Direct capture of quoted market prices Observable market data
	66,662	66,662	Level 1			2,922 Direct capture of quoted market prices Observable market data
2.4. Equity instruments			Level 2			86 Calculation of prices from market inputs and - fixing of equity, volatility, interest rate curves and explicit formulas EURIBOR fixing
			Level 2			7,229 Calculation of prices from market inputs and equity fixing, volatility explicit formulas
	643,689	643,689	Level 2			219 Calculation of prices from market inputs and fixing of currency, interest rate curves explicit formulas
2.5. Trading derivatives			Level 2			162,056 Calculation of prices from market inputs and interest rate curves and EURIBOR fixing explicit formulas
			Level 2			24,932 Calculation of prices from market inputs and fixing of equity, volatility, interest rate curves and explicit formulas fixing
			Level 2			446,245 Calculation of prices from market inputs and fixing of currency, interest rate curves explicit formulas
Other financial assets at fair value through profit or loss
3.4. Equity instruments		18,158	18,158	Level 1		18,158 Direct capture of quoted market prices Observable market data
Financial assets available for sale
				Level 1		2,301,283 Direct capture of quoted market prices Observable market data
4.1. Debt instruments		2,321,671	2,321,671	Level 2		20,388 Calculation of prices from market inputs and explicit interest rate curves and EURIBOR fixing formulas
4.2. Equity instruments		111,880	111,880	Level 1		111,880 Direct capture of quoted market prices Observable market data
4.3. Equity instruments valued at cost		49,620
Loans and receivables
5.1. Deposits with credit institutions		1,182,215	1,182,894	Level 2		1,182,894 Present value Expected cash flows discounted at market rates
5.2. Loans and advances to customers		41,307,010	41,791,671	Level 2		41,791,671 Present value Expected cash flows discounted at market rates
5.3. Debt instruments		117,825	135,850	Level 2		135,850 Present value Expected cash flows discounted at market rates
Held to maturity investments
6. Held to maturity investments		3,220,721	3,326,368	Level 1		3,326,368 Direct capture of quoted market prices Observable market data
Hedging derivatives
7. Hedging derivatives		84,481	84,481	Level 2		84,481 Calculation of prices from market inputs and explicit interest rate curves and EURIBOR fixing formulas

LIABILITIES	Carrying amount	Fair value	Hierarchy	Fair value	Valuation techniques	Main inputs
Held for trading
1.3. Customer deposits	193,482	193,482	Level 2		193,482 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
			Level 1		18,486 Direct capture of quoted market prices	Observable market data
			Level 1		1,781 Direct capture of quoted market prices	Observable market data
			Level 2		14,060 Calculation of prices from market inputs and explicit formulas	equity fixing, volatility,
1.5. Trading derivatives	252,537	252,537			1,702 Calculation of prices from market inputs and explicit formulas	currency fixing
					163,871 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing
						15,321 Calculation of prices from market inputs and explicit formulas	interest rate curves and currency fixing
					37,316 Calculation of prices from market inputs and explicit formulas	interest rate curves and equity fixing
1.6. Short positions in securities	1,305,702	1,305,702	Level 1		1,305,702 Direct capture of quoted market prices	Observable market data
Financial liabilities at amortised cost
3.1. Deposits from central banks	3,243,794	3,243,872	Level 2		3,243,872 Present value	Expected cash flows discounted at market rates
3.2. Deposits from credit institutions	4,587,188	4,680,778	Level 2		4,680,778 Present value	Expected cash flows discounted at market rates
3.3. Customer deposits	29,624,282	29,721,242	Level 2		29,721,242 Present value	Expected cash flows discounted at market rates
3.4. Marketable debt securities	9,516,372	10,069,035	Level 2		10,069,035 Present value	Expected cash flows discounted at market rates
3.5. Subordinated liabilities	612,438	755,655	Level 2		755,655 Present value	Expected cash flows discounted at market rates
3.6. Other financial liabilities	1,328,657	1,328,657	Level 2		1,328,657 Present value	Expected cash flows discounted at market rates
Hedging derivatives
4. Hedging derivatives	25,608	25,608	Level 2		25,608 Calculation of prices from market inputs and explicit formulas	interest rate curves and EURIBOR fixing

The "Level 1" hierarchy comprises the figures for financial instruments whose fair values are obtained from listed prices on active markets for the same instrument, i.e. without modifying or reorganising differently. The "Level 2" hierarchy comprises the figures for financial instruments whose fair values are obtained from listed prices on active markets for similar instruments or using other valuation techniques in which all significant inputs are based on observable market data. The "Level 3" hierarchy comprises figures for financial instruments whose fair values are obtained from valuation techniques in which a significant input is not based on observable market data.

Certain equity instruments are measured at cost because their fair value cannot be reliably estimated. The inability to make a reliable estimate of fair value is due to the wide range of estimates and the impossibility of reasonably assessing the probabilities of each estimate in the range.

The fair value of financial instruments as derived from internal models takes account of the terms of contracts and observable market data including interest rates, credit risk, exchange rates, listings of shares, volatilities, etc. We assume that markets in which we operate are efficient and that therefore their data are representative. The valuation models do not incorporate subjectivities.

In addition, in some cases and given the complexity of products valued, the price used is that published by the counterparty in official media such as Reuters.

At 31 December 2014 the main techniques used by internal models to determine the fair value of financial instruments were the net present value model, which discounts future flows to the present using market interest rates, and the Black-Scholes model and its derivative, which, by means of a closed formula and using exclusively market inputs, enable interest rate options to be valued. Credit derivatives are valued in the same way as other interest rate derivatives, except that the market inputs include the (market)differentials corresponding to the underlying of the issue. We constantly compare and contrast the various valuations with counterparties to ensure the validity of the models and inputs used at all times.

In determining the fair value of liability derivatives, the Bank distinguishes between collateralised positions, for which the impact of the credit risk itself is estimated as zero, and uncollateralised positions, for which the valuation adjustment for credit risk is estimated objectively on the basis of the probability of default of the entity observed in data published by the major financial information agencies in the market.

In determining the fair value of asset derivatives, the Bank distinguishes between collateralised positions, for which the impact of the credit risk itself is estimated as zero, and uncollateralised positions, for which the adjustment to fair value for counterparty credit risk is estimated in accordance with internal PD models constructed on the basis of historical information from the Bank's databases.

In determining the fair value of investments in subsidiaries, joint ventures and associates, the Bank's accounting policy is to consider the whole investment as the unit of account.

b) Fair value of non-financial assets and liabilities

The following is a breakdown of the fair value of non-financial assets and liabilities as at 31 December 2014 and 2013:

		€000s	€000s
		31/12/2014	31/12/2013
	Recognised value Fair value		Recognised value	Fair value
Asset:
Tangible assets	467,363	462,689	434,931	436,236
Repossessed assets	356,671	356,671	369,210	369,210

Fair values of investment property were calculated based on observable market prices. For this calculation the appraisal values certified by Appraisal Companies were taken as the basis and altered by the price variation index if the appraisals had been made more than three years previously.

45. Risk policies and management

General risk management framework

The Board of Directors of Bankinter establishes the risk appetite (the levels of risk that Bankinter is prepared to assume in carrying out its business strategy) and monitors and supervises the policies, systems and internal control procedures relating to all the Group's risks.

Among the Board of Directors' administrative and supervisory functions, as far as risk is concerned there are two clearly separate functions for which it is ultimately responsible. The Board of Directors oversees these functions, and may on occasion delegate their performance and monitoring to other delegated bodies as indicated hereunder:

• Authorisation, completion, valuation, sanction or ratification of credit risk transactions: This faculty is delegated by the Board of Directors of Bankinter, depending on the nature or amount, to the following delegated or internal bodies:
• Executive Committee, which is executive and adopts decisions in the scope of the powers delegated by the Board. It approves transactions within the limits established by the Board of Directors, and resolves transactions in excess of the powers delegated to lower bodies.
• Executive Risk Committee,, chaired by the executive Vice-chairman and to which belong the executive directors and the two General Managers of Commercial Banking and Business Banking, the CRO and the Credit Risk Manager. It is responsible for establishing limits of delegation of powers to lower in-house bodies, within the limits established by the Board of Directors. Its responsibilities include approving individual or group risks in accordance with the delegation system established and monitoring the credit quality of the Banks' various businesses, the risk concentrations and developments in the most sensitive sectors at any given time.

Approval of the risk control and management policy and supervision of the related control and information systems. In performing this function, the Board of Directors relies on the Delegated Risks Committee, which is of a consultative nature and is formed by members of the Board of Directors of Bankinter, mainly independent. It meets at least quarterly and is responsible for monitoring capital planning and advising on risk appetite.

The Chief Risk Officer (CRO) is the person ultimately responsible for risk management. He reports functionally to the Delegated Risks Committee and hierarchically to the CEO. He is a member of the Executive Risks Committee, to ensure that approval, measurement, analysis, control and information of the risks studied in the Committee conform to the general risk policy established, ultimately, by the Board of Directors.

From both a hierarchical and a functional point of view, the CRO reports to the various Risk Management Directorates or Units, as well as the Internal Control and Validation of Risks, duly segregated.

Risk management is based on the following general principles:

• Contributing towards maximising capital, safeguarding the Bank's solvency.
• Independence of the risk function.
• Alignment with strategic objectives.
• Determining risk, approval and monitoring of new products.
• Integrated risk management.
• Importance of automated approval systems.
• Risk diversification.
• Relevance of quality of service in the risks function.
• Sustainable Investment Policy.
• Responsible Lending Policy.

The Group has a Responsible Lending Policy, pursuant to the provisions of the Transparency Act, which contains the principles that the Bank has always applied in this field.

The identification, measurement, monitoring, control and management of all the risks inherent in banking operations constitute a fundamental aim within the framework of overall management of all risks.

Bankinter has received Banco de España approval for its internal rating based (IRB) models and the corresponding methodologies, systems and policies for measuring credit risk, applying them to the calculation of capital requirements as established by the solvency regulations.

Credit risk

Organisation, policies and management

We go on to describe the main features of the management and control of credit risk and the units that perform it, reporting to the CRO:

Credit Risk is responsible for developing and disseminating the policies on acceptance, monitoring and management of risks. Its targets include the development of automated approval systems and all risk approval processes, while always seeking maximum efficiency and quality.

While remaining the Bank's traditionally rigorous approach in evaluating risks and the principles of transparency with customers, the risk approval policy seeks to boost lending to strategic business segments, and has as its basic pillars customers' proven solvency and ability to pay, the strictly complementary function of guarantees and rigorous assessment, a pricing policy suited to customers' risk profiles and transactions, and maintaining an appropriate diversification of risk by customers and sectors.

The control and monitoring policies, and the management of problematic transactions, rely heavily on technology to achieve uniformity and efficiency of processes, the ability to anticipate events and high levels of recovery.

Credit risk management is carried out through the following units in the organisation:

• Risk approval and policies are the responsibility of:
• Risks on Private Individuals.
• Risks on Businesses and Property Promoters.
• Corporate Risks.

Defining and improving the various risk processes and IT systems is carried out by Risk Processes.

The construction and maintenance of risk models and their components is the responsibility of Global Risk Management.

In addition to their own functions, the various Units take part in the process of defining new products and determining the risk parameters and the approval process.

In accordance with the Bank's strategy and policies, the hierarchy and structure of the powers delegated to each of the risk Committees are established, and the approval systems automatically check that they are complied with.

The risk approval process is supported by an electronic proposal that enables integration and unification of all of the Bank's networks and channels. The use of statistical models enables retail risk approval to be automated and provides support for decisions on risks requiring non-automated approval.

Incident Control is responsible for managing and handling the processes for the control, monitoring and collection of early arrears, developing automated systems to make the processes more efficient.

The Arrears department is responsible for managing and handling processes for the control, monitoring and non-amicable recovery of loans, establishing processes and systems to make this activity more efficient and improve recovery rates on nonperforming loans. It is also responsible for all matters relating to the policy on, and the study, approval and monitoring of refinancing transactions.

Real Estate Assets is responsible for setting prices for repossessed assets, establishing sales policies and upkeep and care of the assets until they are sold, with a view to maximising the value for the Group, taking account of market conditions at any given time.

Risk Control and Internal Validation has overall and corporate responsibilities in support of the Group's governing bodies. Its duties are performed by the: Risk Control Unit, whose mission is to supervise the quality of the Group's risk management and ensure that the management and control systems for the various risks meet the most demanding criteria and the best practices observed in the sector and/or required by the regulators, and verifying that the effective risk profile assumed is in accordance with that established by senior management; and the Internal Validation Unit, which is responsible for validating the credit, market and economic capital risk models to evaluate their appropriateness in terms of both practical management and regulatory compliance.

Every year the Risks Division produces a Risk Map, to identify, quantify and uniformly summarise the various risks to which the Bank is exposed, as well as the situation of the management systems used to control them, with the aim of reducing potential losses as far as possible by means of mitigation measures.

Risk diversification is a fundamental management principle that has demonstrated its effectiveness in the successive financial crises. The Bank carries out regular monitoring of risk diversification by sector, geographical location, product, guarantee, customers and counterparties.

Developments during the year

In 2014 in Spain the economic recovery that started in mid-2013 continued to consolidate. Forecasts of Banco de España in December 2014 for year-end pointed to GDP growth of 1.4%, basically underpinned by recovery in domestic demand (+2.2%) and with a reduction in the contributing of the export sector (-0.8%), and modest growth in employment (+0.8%) against a background of falling prices (CPI -0.1%).

In accordance with the information from Banco de España, financing conditions in Spain continued to improve during the year except for isolated episodes of instability, and this allowed financing costs for businesses and households to be reduced. New lending increased, although total outstandings continued to fall: at the end of November, the balance of financing to non-financial businesses was still 4.8% below that of one year earlier, and that of financing to households was 3.9% down. The process of deleveraging thus continues, for businesses and households, although it has moderated and the financial cost of debt declined over the course of the year.

Bankinter has once again demonstrated its financial solidity in this context and has once again grown by more than the sector as a whole. Thus the computable credit risk (which includes lending and contingent liabilities such as guarantees) grew by 3.7%. In 2014 lending to private individuals recovered, growing by 1.3% mainly as a result of the reactivation of residential mortgage lending, in which Bankinter is playing a leading role. Lending to companies grew by 6.4%, continuing the trend of recent years. At year-end, computable risk on private individuals represented 52.5% of the total, and that on companies 47.5%.

As for non-performing loans, the year ended with an NPL ratio of 4.72%, 26 basis points less than the year before, representing a reduction of 5.2%. The favourable difference between this NPL ratio and that of the sector as a whole continued to increase, Bankinter's NPL ratio at the end of the year being 37% of the sector average (which was 12.75% according to Banco de España data at November 2014). The volume of problematic and repossessed assets continues to be well below that of the Group's main competitors. At the end of December 2014 the portfolio of repossessed (foreclosed) assets stood at €586 million, 1.2% of total credit risk, having been reduced by 6.7% in the year.

Credit risk (€000s)	31-12-2014	31-12-2013	Change	%
Computable risk excl. securitisation	47,321,948	45,653,137	1,668,811	3.66%
Doubtful debts	2,232,732	2,275,370	-42,638	-1.87%
Provisions for credit risk	953,022	956,626	-3,605	-0.38%
NPL ratio (%)	4.72%	4.98%	-0.26%	-5.22%
Non-performing loans coverage ratio (%)	42.68%	42.04%	0.64%	1.53%
Repossessed assets	585,830	627,826	-41,996	-6.69%
Provision for impairment of repossessed assets	229,159	258,616	-29,458	-11.39%
Coverage of repossessed assets (%)	39.12%	41.19%	-2.08%	-5.04%

The average effort (measured as the proportion of income that the customer allocates to paying mortgage loan instalments) in the mortgage portfolio remained at a very low level (23% at year-end).

The breakdown of the residential mortgage portfolio by LTV is as follows:

TOTAL BANK	% OPERATIONS
LTV 00 - 10%	15.9
LTV 10 - 20 %	13.8
LTV 20 - 30 %	13.9
LTV 30 - 40 %	14.1
LTV 40 - 50 %	14.3
LTV 50 - 60 %	12.9
LTV 60 - 70 %	9.6
LTV 70 - 80 %	4.1
LTV 80 - 90 %	0.9
LTV 90 - 100 %	0.6
TOTAL LTV BRACKETS	100.0

Private individuals

In 2014 there was gradual stabilisation in the real estate market, especially in the urban areas, in which Bankinter concentrates its activity. In this regard, the Bank has started selective residential mortgage lending campaigns within the parameters of high credit quality that characterise the Bank, which has led to net growth in lending to private individuals. The LTV (loan to value) ratio, which measures the ratio of the amount of the loan to the value of the property, was maintained at 59% at year-end, and 81% of the mortgage portfolio was secured by mortgages on residential property.

The private individuals portfolio maintains its high credit quality, amounting to €24,454 million at year-end, up by 1.4% relative to the previous year, and with an NPL ratio of 3.1%.

The policy for approving new residential mortgage loans, which is the product with the biggest exposure, continues to be very conservative. Since 2003 we had a maximum LTV of 80%, in anticipation of a change of cycle, which is decisive in the differential quality of this portfolio compared with the sector as a whole. l System

The NPL ratio in this portfolio (2.8% at year-end) continues to be the best in the entire financial system, which in September 2014 (the latest information published by the Mortgage Association of Spain) had an NPL ratio of 6.0% for this type of lending.

l Bankinter Information on the sector provided by the Spanish Mortgage Association

Corporate Banking

Bankinter has many years of experience in this segment, the activity of which is more international and less exposed to the Spanish economic cycle and has a lower NPL rate. Lending to this segment stabilised in 2014, ending the year at 13,889 million, down by 0.3% on the year before. The NPL ratio at year-end was 3.4%.

Small and medium-sized enterprises

The economic recovery has allowed growth in lending to the small and mediumsized enterprise (SME) segment, risk on which amounted to €8,102 million at yearend, 19.9% up on the previous year, with an NPL ratio of 9.5%. The Bank applies automated decision-making models to this segment, as well as having teams of experienced risk analysts.

Maximum exposure to credit risk

The following table shows the maximum level of exposure to credit risk undertaken by the Group as at 31 December 2014 and 2013 for each class of financial instrument, without deducting from same tangible securities or other credit enhancements received to ensure borrowers' compliance:

As at 31 December 2014

					€000s
				Asset balances
Types of instrument	Financial assets at fair value through profit or loss		Financial assets	Loans and	Held to maturity	Hedging	Memorandum accounts	Total
	Held for trading	Other assets	available for sale	receivables	investments	derivatives
Debt instruments
Deposits with credit institutions	544,528	-	-	1,113,441	-	-	-	1,657,969
Negotiable securities	2,404,816	49,473	3,013,813	446,357	2,819,482	-	-	8,733,941
Loans and advances to customers	1,967,180	-	-	42,446,723	-	-	-	44,413,903
Total debt instruments	4,916,524	49,473	3,013,813	44,006,521	2,819,482			54,805,813
Contingent risks -
Financial guarantees	-	-	-	-	-	-	763,223	763,223
Other contingent risks	-	-	-	-	-	-	1,973,306	1,973,306
Total contingent risks							2,736,529	2,736,529
Other exposure -
Derivatives	436,958	-	-	-	-	-	-	436,958
Contingent commitments	-	-	-	-	-	-	13,527,713	13,527,713
Other exposure	-	-	-	-	-	148,213	-	148,213
Total other exposure	436,958					148,213	13,527,713	14,112,884
MAXIMUM LEVEL OF EXPOSURE TO CREDIT RISK	5,353,482	49,473	3,013,813	44,006,521	2,819,482	148,213	16,264,242	71,655,226

As at 31 December 2013

					€000s
			Asset balances
Types of instrument	Financial assets at fair value through profit or loss		Financial assets	Loans and	Held to maturity	Hedging	Memorandum accounts	Total
	Held for trading	Other assets	available for sale	receivables	investments	derivatives
Debt instruments
Deposits with credit institutions	920,112	-	-	1,182,215	-	-	-	2,102,327
Negotiable securities	1,803,333	18,158	2,483,171	117,825	3,220,721	-	-	7,643,208
Loans and advances to customers	979,439	-	-	41,307,010	-	-	-	42,286,449
Total debt instruments	3,702,884	18,158	2,483,171	42,607,050	3,220,721	-	-	52,031,984
Contingent risks -
Financial guarantees	-	-	-	-	-	-	661,879	661,879
Other contingent risks	-	-	-	-	-	-	1,740,016	1,740,016
Total contingent risks							2,401,895	2,401,895
Other exposure -
Derivatives	643,689	-	-	-	-	-	-	643,689
Contingent commitments	-	-	-	-	-	-	13,548,719	13,548,719
Other exposure	-	-	-	-	-	84,481	-	84,481
Total other exposure	643,689					84,481	13,548,719	14,276,889
MAXIMUM LEVEL OF EXPOSURE TO CREDIT RISK	4,346,573	18,158	2,483,171	42,607,050	3,220,721	84,481	15,950,614	68,710,768

The following is a breakdown by instrument of the guarantees held by the Bank and other credit enhancement, as well as their financial effect in relation to the amount that best represents the maximum level of exposure to credit risk available as at the end of 2014 and 2013:

As at 31 December 2014

		Secured	Other tangible	Personal
€000s	Total balance sheet 2014	by property	security	Guarantee
Deposits with credit institutions	1,657,969		544,528	1,113,441
Negotiable securities	8,733,941		202,392	8,531,549
Loans and advances to customers	44,413,903	26,731,882	2,781,347	14,900,674
Financial guarantees	763,223	5,448	78,692	679,083
Other contingent risks	1,973,306	7,941	115,356	1,850,009
Derivatives	436,958		428,985	7,973
Contingent commitments	13,527,713	540,194	173,344	12,814,175
Other exposure	148,213			148,213
Maximum level of exposure to credit risk	71,655,226	27,285,465	4,324,644	40,045,117

As at 31 December 2013

€000s	Total	Secured by property	Other tangible security	Personal Guarantee
Deposits with credit institutions	2,102,327		920,112	1,182,215
Negotiable securities	7,643,208		220,705	7,422,503
Loans and advances to customers	42,286,449	26,661,800	693,783	14,930,866
Financial guarantees	661,879	6,882	64,231	590,766
Other contingent risks	1,740,016	8,789	94,625	1,636,602
Derivatives	643,689		593,928	49,761
Contingent commitments	13,548,719	324,569	157,358	13,066,792
Other exposure	84,481			84,481
Maximum level of exposure to credit risk	68,710,768	27,002,041	2,744,741	38,963,986

The following information shows the credit quality of financial assets that are not overdue and the value of which is not impaired for December 2014 and 2013:

€000s	2014	2013
No appreciable risk	7,228,730	7,548,452
Low risk	20,505,880	20,744,496
Medium-low risk	6,119,002	5,698,170
Medium risk	11,713,212	9,687,803
Medium-high risk	247,227	240,393
High risk	697,288	582,043
TOTAL	46,511,338	44,501,356

The following analysis shows the ageing of overdue amounts (past due and unpaid) of financial assets the value of which is not impaired as at 31 December 2014 and 2013:

DECEMBER 2014	MORTGAGE	PLEDGE	OTHERS
0-30 DAYS OVERDUE	5,429	7,444	107,724
30-60 DAYS OVERDUE	12,526	862	10,728
60-90 DAYS OVERDUE	8,856	74	7,804
Total	26,811	8,380	126,257
DECEMBER 2013	MORTGAGE	PLEDGE	OTHERS
0-30 DAYS OVERDUE	6,571
		2,481	101,555
30-60 DAYS OVERDUE	4,759	111	11,777
60-90 DAYS OVERDUE	5,714	52	6,680

The following is a breakdown of debt instruments for which impairment has been determined individually. There are no other financial instruments for which impairment has been determined individually.

	Debt instruments
	Risks
Item	Total	Excess over guarantee value
Financial assets for which impairment has been determined individually	1,101,981	65,321
Transactions originated as "without appreciable risk"	2,505
General treatment	479,569
Up to 6 months	104,966
Between 6 and 9 months	16,044
Between 9 and 12 months	25,297
More than 12 months	333,262
Transactions secured by movable assets	619,907	65,321
Up to 6 months	135,234	15,566
Between 6 and 9 months	37,755	3,150
Between 9 and 12 months	24,272	1,728
More than 12 months	422,647	44,877

An individual analysis of each credit asset is carried out every year. The main factors taken into account in calculating the impairment of each asset are as follows:

(a) Verification and analysis of external ratings published on our customers.

(b) Analysis of financial statements.

(c) Evolution and analysis income statement and ability to pay.

(d) Analysis and projection of cash flows.

(e) Significant reductions in the customer's capitalisation, which may cast doubt on repayment of the financial burden.

(f) Changes in debt.

(g) Changes in and sustainability of cost structure.

(h) Verification and analysis of any credit event of the customer that might affect his

debt payment capacity.

(i) Changes in the value of the guarantees.

(j) Changes in the percentage of the Bank's debt of total debt.

Incidence Control

Incident Control is responsible for managing and handling the processes for the control, monitoring and collection of early arrears, through:

• Preventive control, detecting and interpreting warning signs by means of technological support.
• Collection of unpaids from the moment they arise and up to 90 days, minimising their transition to NPL.
• Systems that facilitate efficient handling of early arrears.

This intensified attention given to incidents during the year helped to reduce unpaids 30 to 90 days overdue by 10% and transition to NPL by 26% from the previous year.

Non-performing loans

The NPLs and Repossessed department manages and handles the processes of control, monitoring and non-amicable recovery of loans in accordance with the supervisor's rules, promoting and encouraging the use of automated systems to increase handling efficiency and collection of overdues. It is also responsible for all matters relating to the policy on, and the study, approval and monitoring of refinancing transactions.

The year 2014 was characterised by stabilisation in the number and volume of new NPLs. Doubtful risk at year-end stood at €2,233 million, 1.9% less than at the previous year-end.

This reduction in doubtful debts, together with the increase in lending, enabled the bank to reduce the NPL ratio by 5.2% in the year, to 4.72% at the end of December. During the year Bankinter continued to improve its recovery processes.

Trend in non-performing loans. Balance and ratio (Data in € millions and %)

The portfolio of credit risk refinancing and restructuring transactions at the end of 2014 stood at €1,644 million, with any amendment to credit risk conditions arising from financial difficulties being considered as refinancing.

The flow of non-performing loan balances was as follows:

			Difference
Movement of doubtful risk (includes contingent risk)	31-12-2014	31-12-2013	Amount	%
Balance at start of period	2,275	1,984	291	14.68
Net additions	172	524	(464)	(88.57)
Written off	213	232	(130)	(55.87)
Balance at close of period	2,234	2,275	(43)	(1.87)

Real estate assets (originating from problem loans)

Loan Provisions (% coverage) Dec.13 Dec. 14 42.04% 42.68

Policy on refinancing and restructuring

The Refinancing Policy follows the best practices as contained in Banco de España Circular 6/2012, of 28 September and letters from Banco de España dated 30 April 2013. Its main objective is to recover all amounts due, which implies the necessity of immediately recognising any amounts considered non-recoverable.

Bankinter's policy on the refinancing of transactions includes:

• Individualised, updated analysis of the economic and financial situation of borrowers and guarantors and of their capacity to repay.
• Situation and effectiveness of the security offered.
• Experience with the borrower: sufficiently long track record of compliance or, failing that, equivalent record of principal repayment.
• Half-yearly rating review.
• No end to NPL status. The refinancing or restructuring of a transaction that is in arrears (non-performing loan) does not bring an end to such NPL status, nor will it lead to its being reclassified, unless there is reasonable certainty that the customer can repay, or new effective security is provided, and in either case at the very least the normal accrued interest must be paid.

The gross balance of the portfolio of real estate assets at year-end stood at €585.83 million, with a reduction in the year of €42 million.

Real estate assets are highly diversified in geographical terms and as regards property type, which makes them easier to sell. The volume of sales amounted to €278,538,000, 14.4% up on the previous year.

Regarding the Bank's real estate portfolio, it is worth noting that it does not include any properties currently in the development stage and that the proportion of rural land is very small; in the current situation the market for both these products is limited.

Repossessed assets	31-12-2014	31-12-2013	Change 2014/2013	%
Balance at start of period	627,826	611,666	16,160	3%
Net additions	-41,996	16,161	-58,157	-360%
Balance at close of period	585,830	627,826	-41,996	-7%
Provision for impairment of repossessed assets	-229,159	-258,616	29,458	-11%
Net balance of repossessed assets	356,671	369,210	-12,539	-3%

Provisions

Solvency levels and asset coverage allow the Group to face the current situation in good condition. The coverage ratio of provisions to NPLs remained stable in the year at 39.12% compared with 42.0% at the end of the previous year. The doubtful mortgage lending portfolio has an LTV of 47%, which, together with the low rate of arrears in this portfolio, gives rise to very limited losses.

The refinancing of a transaction involves its being classified in one of the following categories:

• Normal refinancing. Those for which objective evidence is held, making it highly probable that all amounts owed will be recovered. In this respect the following factors are taken into account:
• Grace period maximum 12 months.
• Existence of an appropriate repayment plan.
• Incorporation of guarantors of undoubted solvency, or of new effective collateral.
• Doubtful refinancing. This classification will apply to transactions where there is evidence of weakness in the borrower's ability to repay. The minimum provision applied to this type of transaction is 25%. In this respect the following factors are taken into account:
• Failure to provide new effective security, or failure to pay all interest due.
• The granting of grace (interest only) periods in excess of 30 months.
• The source of previous refinancings or restructurings.
• Except, in all cases, if there is evidence of the borrower's having sufficient capacity to meet his commitments in the time and form contractually provided.
• Sub-standard refinancing. All cases not covered by the two foregoing classifications, and the accounting provision will be 15%.

Policy on accounting reclassification

Reclassification between categories of Refinancing so as to be considered as a normal refinancing (and thus with no provision) requires an exhaustive review of the asset and financial situation to conclude that the borrower is unlikely to have financial difficulties. In this regard, the following factors are assessed;

• Capacity to repay the debt of all transactions.
• Payment of instalments from the refinancing on:
• Residential mortgage with monthly instalments: minimum 6 months.
• Rest: minimum 12 months.
• Payment of 10% of the amount refinanced.
• Home mortgages:
• Effort (less than 50%).
• Grace period (less than 30 months).
• Number of refinancing.
• Financing of instalments.
• Positive experience subsequent to refinancing.
• Companies:
• Grace period (less than 30 months).
• Incorporation of sufficient effective security.
• Payment of interest.
• Number of refinancing.
• Financing of instalments.
• Positive experience subsequent to refinancing.

Types of transactions: In accordance with the Circular referred to, we differentiate among:

• Refinancing transaction.
• Refinanced transaction.
• Restructured transaction.
• Renewal transaction.

• Renegotiated transaction.

• Refinancing transaction: transaction which, irrespective of the borrower or security held, is granted or used for economic or legal reasons relating to financial difficulties - current or foreseeable - of the borrower(s) in order to cancel one or more transactions granted by the Bank or by other Group entities to the borrower(s) or to one or more other companies of the borrower's economic group, or whereby such transactions are brought totally or partially up to date with payments, in order to help the borrower(s) under the cancelled or refinanced transactions to pay their debts (principal and interest) because they cannot, or it is thought that they will not be able to comply in time and form with its conditions.

• Refinanced transaction: transaction that is brought totally or partially up to date with payments as a consequence of a refinancing transaction carried out by the Bank or another entity in its Group.

• Restructured transaction: transaction in which, for economic or legal reasons relating to current or foreseeable financial difficulties of the borrower(s), the financial conditions are amended in order to help the borrower(s) to pay their debts (principal and interest) because they cannot, or it is thought that they will not be able to comply in time and form with said conditions, even if such amendment is envisaged in the contract. In any case, the following transactions shall be considered to have been restructured: transactions involving a 'haircut' or debt forgiveness or where assets are accepted in part-payment of the debt, or where the conditions are amended to extend the maturity, changing the repayment schedule to reduce the amount of the instalments in the short term or reduce their frequency, or establish or extend a grace period for principal, interest or both, except when it can be shown that the conditions are being amended for reasons other than the borrower's financial difficulties and are analogous to those applied in the market at the date of the amendment to transactions granted to customers with a similar risk profile.

• Renewal transaction: transaction entered into to replace another previously granted by the Bank, without the borrower having or being seen as likely to have financial difficulties in the future; i.e. when the conditions are amended for reasons other than refinancing.

• Renegotiated transaction: transaction where the financial conditions are amended without the borrower having or being seen as likely to have financial difficulties in the future; i.e. when the conditions are amended for reasons other than restructuring.

The Group currently has live refinanced loans totalling €1.64 billion. This figure includes both regular status loans and substandard and delinquent balances. This figure represents 3.47% of total Credit Risk. Of the amount refinanced, €266 million corresponds to property developers. For private individuals, the Group has refinanced a total of €445 million.

Economic impact

Total cover for refinancing and restructuring is €303 million. The cost of newly refinanced transactions in 2014 was €24 million (€125 million in 2013).

The following is a reconciliation of the opening and closing balance sheets for refinanced and restructured assets and the balance of associated impairment provisions, showing separately for both items the movements for each risk category: normal, substandard and doubtful:

		TOTAL NORMAL		TOTAL SUBSTANDARD	TOTAL DOUBTFUL		TOTAL DECEMBER 2013
REFINANCED PORTFOLIO 31 DECEMBER 2013 (€000s)	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage
Public administrations	9,203	-	-	-	-	-	9,203	-
Companies and entrepreneurs	464,318	-	304,597	33,146	572,919	259,941	1,341,834	293,087
Private individuals	179,426	-	110,855	2,909	92,634	10,869	382,915	13,778
TOTAL	652,947	-	415,452	36,055	665,553	270,810	1,733,952	306,865
		ADDITIONS TO 'NORMAL'		ADDITIONS TO 'SUBSTANDARD'		ADDITIONS TO 'DOUBTFUL'		TOTAL ADDITIONS
ADDITIONS (000s)	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage
Public administrations	-	-	-	-	-	-	-	-
Companies and entrepreneurs	128,498	-	15,524	1,208	119,851	62,287	263,874	63,495
Private individuals	79,829	-	19,230	622	46,162	8,269	145,221	8,891
TOTAL	208,327	-	34,754	1,829	166,013	70,556	409,094	72,386
		REMOVALS FROM 'NORMAL'	REMOVALS FROM 'SUBSTANDARD'		REMOVALS FROM 'DOUBTFUL'		TOTAL REMOVALS
REMOVALS (€000s)	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage
Public administrations	383	-	-	-	-	-	383	-
Companies and entrepreneurs	127,596	-	150,412	21,441	137,338	52,218	415,346	73,659
Private individuals	45,301	-	21,749	834	16,498	1,893	83,549	2,727
TOTAL	173,280	-	172,162	22,275	153,837	54,111	499,279	76,386
		TOTAL NORMAL		TOTAL SUBSTANDARD		TOTAL DOUBTFUL		TOTAL DECEMBER 2014
REFINANCED PORTFOLIO 31 DECEMBER 2014 (€000s)	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage	Gross amount	Specific coverage
Public administrations	8,820		-	-	-	-	8,820	-
Companies and entrepreneurs	465,221		169,709	12,913	555,432	270,010	1,190,362	282,923
Private individuals	213,953		108,336	2,696	122,297	17,245	444,586	19,941
TOTAL	687,994	-	278,045	15,609	677,729	287,255	1,643,768	302,864

The Board of Directors decides the strategy and policy for the Bank's policy as regards "Structural Risks" and "Market Risk" and delegates management, monitoring and control to various Bodies in the Institution. It also decides on the risk profile that the Institution is willing to undertake, establishing the maximum limits that it delegates to said bodies and which are reviewed on an annual basis.

The purpose of the Group's policy on the management and control of "structural" (interest rate and liquidity) risks and market risk is to neutralise the impact of variations in interest rates, in the main market variables and in the balance sheet structure itself, on the Bank's profit and loss account, by adopting the most appropriate investment or hedging strategies.

To this end it develops the most appropriate systems for measuring structural and market risks so as to provide information on the Entity's exposure to these risks, and on any possible deviations that might arise regarding established limits and procedures.

Due to the policies pursued, the Bank has no significant exchange rate risk.

The Board of Directors delegates the ongoing monitoring of decisions regarding structural balance sheet risks (interest rate risk and liquidity risk), stock market risk and exchange rate risk of the Bank's corporate positions, as well as the establishment of the financing policies, to the Assets and Liabilities Committee (ALCO). Moreover, each year it reviews, approves and delegates to the ALCO the limits applicable for managing the aforementioned risks. The Treasury and Capital Markets area implements the decisions taken by the ALCO with regard to the Bank's corporate positions.

To exercise these functions, the most appropriate financial instruments at any given time are used, which include interest-rate, exchange-rate and variable income derivatives. The financial instruments with which trading is undertaken must, in general, be sufficiently liquid and be associated with hedging instruments.

The Balance Sheet Management unit, which is part of the Capital Markets Directorate, has the function of measuring and managing the institution's structural risks.

The Market Risk area, reporting to the Risks Directorate, has the independent function of controlling them:

Structural liquidity risk

Structural liquidity risk is related to the institution's capacity to fulfil its payment obligations and finance its investments. The Bank actively monitors the liquidity situation and its projection as well as actions to be taken both in normal market conditions and in exceptional situations arising from internal causes or market trends.

Management of this risk is the responsibility of the ALCO committee, delegated by the Board of Directors.

The principles, strategies and practices for liquidity management are set out in the Liquidity Planning Framework and ensure that the Bank has sufficient liquidity to be able to meet both its daily liquidity obligations and a period of liquidity tensions. The strategic principles on which liquidity management is based are the following:

• Reducing dependence on wholesale markets for funding the business, by seeking balance growth in retail deposits.
• Diversification of sources of wholesale funding, both from the point of view of instruments and markets, and maintaining a balanced maturity profile.

With the objective of complying with the foregoing principles the following strategic liquidity management lines have been defined:

• Continue to reduce the funding gap.
• Be present in wholesale markets, issuing frequently depending on need and market opportunities.
• Offer maximum transparency to investors, regularly providing information on the Bank.
• Ensure an appropriate wholesale maturity profile, avoiding concentrations.
• Maintain a buffer of liquid assets sufficient to face a possible shutdown of wholesale markets.

During 2014 the funding gap reduced by €291 million and the loans to deposits (LtD) ratio went from 77.6% to 78.3%. Liquidity requirements were covered by turning to the international medium- and long-term debt markets. The Group issued €400 million of mortgage-backed bonds under the fixed income programme registered with the CNMV, and €500 million in senior debt.

To meet its requirements, the Group used short-term issue programmes, mainly in the domestic market with its commercial paper programme. The balance of commercial paper placed in the market traditionally considered as wholesale (counterparties in the financial markets) was €380 million as at 31 December. If major corporates are considered as wholesale, then the figure for commercial paper and commercial paper repos rises to €770 million.

The Bank has various tools for analysing and monitoring the short- and long-term liquidity situation. These tools are static and dynamic. Backtesting is also carried out on projections made.

One of the analyses used to control and monitor liquidity is the liquidity gap, which shows information on the distribution of the balances and cash flows of the asset and liability positions of the balance sheet between various timeframes depending on the expected date of completion or liquidation and in accordance with a series of assumptions based on the historical performance of these products. These assumptions are reviewed on a regular basis and, in such cases as where they are necessary, supported by models based on historical series.

The following shows the liquidity gap at the end of 2014. The information provided by the liquidity plan is static, and does not show the expected financing needs as it does not include behavioural models of the asset items, that is, the prepayment of mortgage loans and the renewal of lines of credit or of liability items such as the renewal of fixed term deposits, among others.

Figures as at December 2014 in € millions	Sight	1 day to 1 month	1 to 3 months	3 to 12 months	12 months to 5 years	more than 5 years	TOTAL
ASSETS
Loans and receivables		2,028	2,783	6,843	12,970	25,755	50,379
Deposits with credit institutions		-	-		-	1,377	1,377
Loans and advances to customers		2,028	2,783	6,843	12,936	23,966	48,556
Other		-	-	-	34	412	446
Fixed Income Portfolio		198	27	1,450	3,469	3,818	8,962
Trading portfolio		50	5	983	735	998	2,771
Available-for-Sale Portfolio		29	21	56	1,406	901	2,412
Held-to-Maturity Portfolio		120	1	411	1,329	1,918	3,779
Other Assets		794	-	-	-	4,717	5,511
Total Assets		3,020	2,810	8,293	16,440	34,289	64,851
LIABILITIES
Fixed income portfolio		268	97	-	592	858	1,815
Trading portfolio		268	97	-	592	858	1,815
Financial liabilities at Amortised Cost	15,505	2,996	3,170	10,036	10,073	9,423	51,204
Deposits from credit institutions	-	125	1,762	463	2,264	3,923	8,536
Customer deposits	15,505	2,533	1,401	8,578	2,258	28	30,304
Marketable debt securities	-	338	8	994	5,552	3,858	10,750
Other	-	-	-	-	-	1,614	1,614
Other liabilities		626	-	-	-	1,044	1,670
Equity		-	-	-	-	3,475	3,475
Total Liabilities and Equity	15,505	3,890	3,267	10,036	10,665	14,801	58,164
TOTAL LIQUIDITY GAP	-15,505	-870	-458	-1,743	5,774	19,489	6,687

As regards contingent liabilities, shown in the following table, the fact that €8.59 billion are shown as being at sight does not mean that they will be called on in the immediate future. Loan accounts, the main component of the amount, are availed by customers based on their financing needs over time.

Figures as at December 2014 in € millions	Sight	1 day to 1 month	1 to 3 months	3 to 12 months	12 months to 5 years	more than 5 years	TOTAL
Contingent Liabilities
Financial guarantees and documentary credits	363	73	154	205	143	22	961
Commitments available by third parties	8,228						8,228

In addition to the foregoing, to control the liquidity risk the Market Risks area verifies compliance with the limits established by the Board and delegated to the department heads and the ALCO (Assets and Liabilities Committee). The calculation of limits is carried out by Market Risks based on the information prepared for the various regulators.

There are three broad types of limit:

• Determining the liquidity buffer: For this the Bank uses both the definition of regulatory LCR (liquidity coverage ratio) and a similar ratio extended to ninety days and with a definition of liquid assets in accordance with those accepted by the European Central Bank as collateral for liquidity. Another reference for calculating the liquidity buffer is the schedule of upcoming maturities of wholesale issues over the next few months.
• Wholesale financing concentration ratios: With the aim of avoiding Bankinter being subjected to stress as a result of a possible sudden shutdown of wholesale markets, limits are established on the amount of short-term wholesale financing that can be taken, as well as on the concentration of issue maturities.
• Ratio of stable deposits to total lending: With a view to limiting reliance on wholesale financing, a minimum ratio of stable deposits to loans is established. In establishing the stability of deposits, use is made both of the regulatory definition of the NSFR (Net Stable Funding Ratio)and of experience of the Spanish finance sector.

As well as the limits established by the Board, monitoring also covers the evolution in the gap or 'liquidity plan' and information and analysis on the specific situation of the balances resulting from trade operations, wholesale maturities, interbank assets and liabilities and other sources of funding. These analyses are carried out both under normal market conditions and simulating different liquidity scenarios that could come about as a result of different trading conditions or changes in market conditions.

Bankinter has a liquidity contingency plan which determines the persons responsible and the lines of action in case of adverse conditions in the financial markets, to obtain liquidity. It identifies three levels of alert; minor problems, serious problems and severe liquidity crisis. As well as having the procedure for identification, it sets out the actions for the persons affected in each of the scenarios. Activation of the contingency plan would be decided by ALCO. The alerts in the contingency plan are followed by both Balance Sheet Management and Market Risks, who inform the members of the ALCO in the event of deterioration in the objective conditions identified.

Structural interest rate risk

Structural interest rate risk is the Bank's exposure to changes in market interest rates arising from timing differences between maturities and repricings of the various items in the overall Balance Sheet.

Bankinter performs active management of this risk in order to protect the interest margin and to preserve the economic value of the Bank against interest rate fluctuations.

In order to control exposure to the interest rate structural risk, the Bank has established a structure of limits that is reviewed and approved on an annual basis by the Board of Management, in accordance with Bankinter's strategies and policies in this regard.

Bankinter has tools to monitor and control the structural interest rate risk. We will now go on to specify the main measurements used by the Bank that enable the management and control of the interest rate risk profile approved by the Board of Directors:

a. Sensitivity of the Financial Margin:

Dynamic simulation measures are used to measure on a monthly basis financial margin exposure in different scenarios of variation in interest rates and for a 12-month time horizon. Financial margin sensitivity is obtained as the difference between the financial margin projected with the market curves at each analysis date and the one that is projected with the interest-rate curves altered in different scenarios, both of parallel movement of rates and changes in the slope of the curve.

Every year, the Board of Directors sets a reference in terms of sensitivity for the financial margin for 100 basis point parallel movements in the interest rate curves for a term of up to 12 months. The sensitivity in this scenario is followed by the ALCO.

The exposure of Bankinter's financial margin to interest rate risk in the event of +/- 100 bp parallel movements in market interest rates is approximately 3.6% for a 12-month horizon on the Bank's management assumptions.

The sensitivity of the Bank's financial margin to changes in the slope of the curve for a 12-month horizon is 1.1%. This scenario is built by holding the 6-month rate constant and changing the short-term (up to 3 months) and 12-month rates by the same amounts but in opposite directions so as to alter the slope of the curve by 25 basis points in the period under consideration.

Financial Margin Sensitivity
	2014
100 bp parallel movements	3.6%
25 bp slope variations	1.1%

b. Sensitivity of Economic Value:

This is a measurement that complements the previous two and which is calculated on a monthly basis. It allows the exposure of the Bank's economic value to interestrate risk to be quantified, and is obtained as the difference between the net present value of the items that are sensitive to interest rates calculated using the curves for rates in different scenarios and the rates curve listed in the market at each analysis date.

Every year, the Board of Directors sets a reference in terms of the economic value sensitivity for 200 basis points parallel movements in market interest rates. Sensitivity to this scenario is measured, controlled and submitted to the ALCO.

The sensitivity of the Bank's Economic Value to 200 basis point parallel movements, obtained by means of the criterion described above, was, at year-end 2014 and 2013, 2.0%and 2.7% of the Bank's equity, respectively.

Market risk:

The Board of Directors delegates proprietary trading in the financial markets to the General Directorate of Treasury and Capital Markets, which acts through its Trading Area with a view to taking advantage of trading opportunities that arise, using the most appropriate financial instruments at any given time, including interest and exchange rate derivatives and equity derivatives. The financial instruments with which trading is undertaken must, in general, be sufficiently liquid and be associated with hedging instruments. The risk that may derive from the management of the institution's own accounts is associated with movements in interest rates, stock market prices, exchange rates, volatility and credit spreads.

The Board of Directors delegates to the ALCO the continuous monitoring of the Treasury Trading area's proprietary trading activities and establishes maximum limits for the authorisation of the possible excesses that may arise in this activity.

Market Risk, which reports to the CRO, has the independent functions of measuring, tracking and controlling the Bank's market risk and the limits delegated by the Board.

Market risk is mainly measured using the "Value-at-Risk" (VaR) methodology, considered both globally and segregated for each significant risk factor. The limits in VaR terms are supplemented by other measures such as stress testing, sensitivities, stop loss and concentration.

We will now go on to describe the methodology for measuring the main market risk indicators.

Value-at-Risk (VaR)

Value-at-Risk (VaR) is defined as the maximum expected loss on a given portfolio of financial instruments, in normal market conditions, for a given confidence level and time horizon, as a result of movements in market prices and variables.

The VaR is the main indicator used daily by Bankinter to measure and control on an integrated and global basis exposure to market risks arising from interest rates, equities, exchange rates, volatility and credit.

The method used to measure VaR is "Historical Simulation" based on the analysis of possible changes in the value of the position, using historical movements in the individual assets forming it. VaR is calculated with a level of confidence of 95% and a time horizon of one day, although additional monitoring is carried out with other levels of confidence.

The following are the comparative VaR data by risk factor for the Bank's positions in 2014 and 2013, both for the total and differentiated by portfolio:

Total VaR 2014
million euros	Final
Interest Rate VaR	3.44
Equities VaR	0.36
Exchange Rate VaR	0.02
Volatility Rate VaR	0.03
Credit VaR	0.00
	3.49

Trading VaR 2014
million euros	Final
Interest Rate VaR	0.54
Equities VaR	0.10
Exchange Rate VaR	0.02
Volatility Rate VaR	0.03
Credit VaR	0.00
	0.58

Available-for-sale VaR
2014
million euros	Final
Interest Rate VaR	3.28
Equities VaR	0.25
Exchange Rate VaR	0.00
Credit VaR	0.00
	3.27

Total VaR 2013
million euros	Final
Interest Rate VaR	7.16
Equities VaR	0.31
Exchange Rate VaR	0.07
Volatility Rate VaR	0.07
Credit VaR	0.00
	7.28

Trading VaR 2013
million euros	Final
Interest Rate VaR	0.39
Equities VaR	0.10
Exchange Rate VaR	0.07
Volatility Rate VaR	0.07
Credit VaR	0.00
	0.38

Available-for-sale VaR 2013
million euros	Final
Interest Rate VaR	6.84
Equities VaR	0.23
Exchange Rate VaR	0.00
Credit VaR	0.00
	6.96

This past year 2014 was characterised by a reduction in spreads of the peripheral euro zone countries except for Greece, where yields increased substantially in the last part of the year due to political instability, and the second half of the year was dominated by the sharp fall in oil prices, the accelerating depreciation of the euro and the increased volatility of equity markets.

In view of the instability seen in the past few years, Bankinter maintained the previous year's limits on VaR (value at risk).

Apart from this, Bankinter also monitors the VaR of the portfolio positions of its subsidiary Línea Directa Aseguradora on a monthly basis, using the historical simulation method. The VaR of Línea Directa Aseguradora's portfolio, based on the same assumptions, as at 31 December 2014, amounted to €2.04 million. Monitoring is also carried out of the possible risk that may be incurred by subsidiary Bankinter Luxembourg, applying the same method as that applied to the parent, VaR by historical simulation. In 2014 the estimated VaR was €0.04 million.

Apart from this, the VaR calculation was reinforced by extending the stress testing analysis by adding specific assumptions based on expectations of their occurring in the financial markets, as well as endeavouring to simulate the most adverse circumstances for the positions taken in trading operations.

Stress Testing

Stress testing, or the analysis of extreme scenarios, is a supplementary test to VaR. The estimates from the stress tests quantify the maximum potential loss in portfolio value under extreme scenarios of change in the risk factors to which the portfolio is exposed.

Every year, the Board of Directors approves an extreme scenario based on significant movements in interest rates, securities exchanges, exchange rates and volatility, and certain upper references regarding these variations for each type of risk. Additionally, estimates are made using other scenarios which replicate different historical crisis situations and other relevant current market situations.

In 2014, the stress scenarios for interest rate and volatility were updated to adapt them to each product type and to the evolution of events observed in the market for this type of risk factors.

The following is information on the results of one of the most extreme stress scenarios for 2014 and 2013:

Stress Testing 2013
million euros	Final
Interest Rate Stress	33.09
Equities Stress	5.07
Exchange Rate Stress	1.23
Volatility Stress	0.20
Credit Stress	0.00
Credit-related Stress	8.19
Total Stress	47.78

Stress Testing 2013
million euros	Final
Interest Rate Stress	52.86
Equities Stress	4.79
Exchange Rate Stress	0.13
Volatility Rate stress	3.48
Credit Stress	0.00
Total Stress	61.27

*The information on stress testing corresponds to the "Trading portfolio" and the "Available-for-sale portfolio".

At year-end 2014 the total level of interest rate stress testing had decreased against 2013, as a consequence of a reduction in the Available-for-Sale portfolio in public debt, as well as in its duration.

Applying the same scenarios to the positions of the portfolio of Línea Directa Aseguradora at the end of 2014, the stress amounted to €40.27 million. Applying the same scenarios to the positions of the portfolio of Bankinter Luxembourg at the end of 2014, the stress amounted to €1.21 million.

Operational risk

Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. It includes legal risks but excludes strategic and reputational risk. In general, it concerns risks which are encountered in processes and generated internally by persons and systems, or which are a consequence of external agents such as natural disasters.

Bankinter uses the standard method to manage operational risk, as per Circular 3/2008 (updated by Regulation 575/2013 of the European Parliament and of the Council). The use of this method requires the existence of certain systems of identification, measurement, and management of operational risks. Its use requires prior authorisation by Banco de España, and it is subject to annual audit as to its proper use. And through its membership of CERO (a private forum of financial entities for exchanging experiences in operational risk management) it ensures access to best practices in the sector.

Principle of action and Management Framework

With a view to achieving an adequate system for managing Operational Risk, Bankinter has laid down the following basic governing principles:

• The basic aim is to identify and preventively mitigate the major operational risks, seeking to minimise any possible associated losses.
• Systematic procedures are defined for assessing, analysing, measuring and reporting risks and generating appropriate action plans for controlling them.
• In terms of exploring the Bank's activities to draw up an inventory of operational risks, the unit selected for analysis is the business unit. Once the business units' risks have been analysed, the Bank's total risks are obtained by aggregating and consolidating them.

The Bankinter Management Framework for Operational Risk is based on the following main elements:

• Identification and evaluation of risks by developing risk maps showing the severity level of the risk, evaluating the appropriateness of existing control mechanisms and showing action plans for mitigating these risks.
• Recording of loss events arising, with the associated management information, sorted and classified in accordance with Basel recommendations.
• Drawing up Business Continuity and Contingency Plans describing the alternative procedures to normal operations aimed at restoring activity in the event of an unforeseen interruption in critical services.
• Generating and disseminating management information that is suited to the needs of each governing body that has responsibilities in managing operational risk.

Structure of Governance

Bankinter applies a decentralised model in which final responsibility for managing operational risk rests with the business and support units.

For governance purposes, the following control bodies and general lines of responsibility have been established:

• Board of Directors: Approves the policies and the management framework; establishes the level of risk that Bankinter is willing to undertake.
• Delegated Risks Committee: A governing body on which Senior Management is represented and which undertakes the following roles in managing operational risk:
• To promote the implementation of Operational Risk management policies.
• Tracking significant operational risks and the development of plans to mitigate them.

• Resolving conflicts of responsibility and deciding on the proposals put forward by Operational Risk.

• New Products Committee: A governing body on which Senior Management is represented and which undertakes the following roles in managing operational risk:

• Oversee compliance with procedures for identifying and evaluating operational risks associated with the launch of new products and new lines of business with customers. Authorising or declining the sale of products with significant operational risks.
• The review of operational risks associated with the sale of existing products, sales policies and the materialisation of these risks in relations with customers, partners and suppliers.
• Monitor projects for mitigating significant operational risks associated with launch and sale of products and services.
• Operational Risk: Reporting to the Risks Directorate, the Operational Risk unit has the following main functions:
• Promoting management of operational risks in the various divisions, encouraging risk identification, allocation of responsibility, keeping of written records of controls, generation of indicators, drawing up of mitigation plans, regular review and action to be taken in the event of new significant losses or risks.
• Equipping divisions and units with the methodologies, tools and procedures necessary for managing their operational risks.
• Promoting the drawing up of contingency and business continuity plans that are appropriate and in proportion to the size and activity of the institution in the units that so require.
• Ensuring that operational losses occurring in the institution are recorded correctly and in full.

• Providing the organisation with a uniform view of its exposure to operational risk, in which the existing operational risks are identified, integrated and evaluated.

• Providing information on operational risk to be forwarded to regulators, supervisors and external bodies.

• Business Units: With the following functions:
• Management of operational risk in the unit and specifically, identification, evaluation, control, monitoring, analysis and mitigation of the operational risk on which it has the ability to act.
• Recording and communication of operational losses produced in the course of their activity.
• Studying, defining, prioritising and funding the operational risk mitigation plans which it is responsible for running.
• Maintaining and testing the business continuity plans supported by the unit.

As regards databases of loss events, the Bankinter operational risk profile is represented in the following graphs:

l Amount

Insurance in managing operational risk

Bankinter uses insurance as a key element in managing certain operational risks, thus complementing the mitigation of risks where their nature makes this advisable.

To this end, the Insurance Area, together with the various areas in Bankinter and taking into account both the operational risk assessments and historical losses, assesses the advisability of altering the coverage perimeter of the insurance policies for the Bank's various operational risks.

Examples include insurance taken out with various companies of recognised solvency for contingencies affecting the Bank's premises (earthquake, fire, etc.), internal or external fraud (robbery, embezzlement, etc.), employees' civil liability, etc.

l Amount

Reputational and compliance risk

In the area of reputational and compliance risks, the Board is responsible for overseeing compliance with the Group's general code of conduct, the global policy on AML and the financing of terrorism and policies for selling products and services.

The delegated risk committee evaluates reputational risk in its field of action and decision. The Audit and Compliance Committee has entrusted to it, among other things, the functions of overseeing compliance with legal requirements, supervising the effectiveness of the internal control and risk management systems, supervising compliance with the Group code of conduct in the securities markets, the AML manuals and procedures and in general, the rules of governance and compliance of the Bank and for making the necessary proposals for their improvement as well as reviewing fulfilment of the actions and measures arising from the reports or actions of the administrative supervision and control authorities.

Reporting to the Board by the compliance function is ongoing, mainly through the Audit and Compliance Committee.

The last level of governance is formed by the corporate internal committees, among them the Product Committee, entrusted with the analysis of the marketing of products and services of the Bankinter Group.

The organisational model is built around the Compliance area, which is part of the Company's General Secretariat.

The management of reputational risk as it relates to the various stakeholder groups' perception of the Company is performed more directly by the Social Reputation area, which is part of the External Communication department. Primary responsibility for managing reputational risk is shared among the Compliance area, the External Communication area and the various business and support units carrying on the activities that give rise to the risk.

Responsibility for developing policies and applying the corresponding controls falls to the Compliance area, in the case of compliance risk, and this area is also responsible for advising senior management on these matters and for promoting a culture of compliance, all this in the framework of an annual programme the effectiveness of which is evaluated periodically.

The area directly manages the basic components of these risks (money laundering, codes of conduct, sale of products, etc.) and oversees attendance to the rest by the corresponding unit of the Group, having the appropriate systems for control and verification in place with which to do this.

The proper execution of the risk management model is supervised by the integral control and internal risk validation area. Also, within its functions, internal audit carries out the necessary tests and reviews to check that the rules and procedures established by the Group are being complied with.

46. Information required by Law 2/1981 of 25 March on Mortgage Market Regulation and Royal Decree 716/2009 of 24 April implementing certain aspects of said law-

The Risk Policy Framework Agreement is the document in which every year the Board of Directors establishes the basic principles of Risks Policy for each business segment. This document contains a specific section on the Responsible Lending Policy in accordance with the Transparency Act, containing the principles traditionally applied by the Bank in this field.

The Policies regarding the granting of mortgage loans include, among others, the following criteria:

• The ratio between the amount of the loan and the appraisal value of the property being mortgaged, and the existence of other complementary guarantees.
• Selecting the valuation institutions.
• The ratio between the debt and the borrower's income, and verification of the information provided by the borrower and the latter's solvency.

The bases of the risks policy for this product are as follows:

Automated approval with discrimination by rating.

• In the case of residential mortgage loans we seek to maximise the extent to which transactions can be approved using automated systems.
• Bankinter has an internal rating model, developed and improved over the course of the last few years, based on statistical systems in accordance with solvency rules. For each transaction, obtaining a rating implies a given probability of default estimated on the basis of historical performance projections of future scenarios. Obtaining a rating for every transaction is associated with a given probability of default based on historical data, and is the main indicator of the quality of a transaction. The rating is the fundamental variable in automated approval and an important factor in taking decisions on transactions for which approval is not automated.

Types of customers and ability to repay.

• The approval of customer transactions is based on individualised studies of the customer, the rating, financial capacity and personalised prices depending on the customer's social and financial profile.
• The maximum effort that a customer can make must always be taken into account. To calculate it, the following information is required: servicing of all debts and recurring income (exceptional income must not be taken into account). In this way we check whether final disposable income is enough to service our financing and the usual expenses. The documentation used as the basis for calculating the effort of the transaction is tax-based, and must be as up-to-date as possible.

Expected profitability.

• The expected profitability of the mortgage applicant is one of the variables taken into account in the automated approval process. Providing the risk quality is good enough, measured in terms of rating, then the approval decision takes into account the profitability both of the mortgage loan itself and of any associated products.

Financing habitual dwelling and secondary residence.

• The mortgage lending policy in Bankinter is geared to the financing of habitual place of residence and secondary residence for private individuals, not to investor-type financing.

LTV (Loan to Value, amount of loan to value of the property).

• The Bank's general policy is to finance homes up to 80% LTV. Exceptionally, in the case of transactions for HNWcustomers with proven capacity to repay, a higher LTV may be allowed. The security needs to be valued correctly, both on approval and during the life of the loan.
• In the approval process, the value of the security is determined by an official appraisal or by the purchase price as registered in the deed of conveyance, whichever is lower, subject to there not being a large difference between the two.

Non-residents.

• More stringent requirements as regards the ratio of effort required. Additionally, LTDhas to be lower and checks must be made on the real equity contribution made by the customer.

Type of asset.

• The residential property to be financed must be located in an established urban zone and there must be a property market with ample supply and demand.

Standardisation of the mortgage process.

• Standardisation is of prime importance in achieving a process in which efficiency is paramount, particularly in retail banking.
• The integrated handling of this process, and co-ordination with all the parties involved (mainly agencies and appraisal firms) is entrusted to a specialised department which takes charge of establishing the procedures, applications, organisation and control of the process. This ensures that the process is carried out smoothly with first-class customer service and excellent quality of mortgage lending.

Independent appraisal process.

• The appraisal process is absolutely independent of the Sales network. It is carried out on a centralised basis, and the appraiser assigned to each valuation is selected at random, thus ensuring that transactions from any given branch have been valued by different appraisal companies.

Monitoring of the mortgage market.

• Official reports are regularly obtained in order to monitor property market prices. In the event of any substantial change in the value of a property the value must be adjusted in the Bank's books.

Multi-currency.

• The existing portfolio, given its volatility linked to the currency, needs to be monitored and controlled. A contingency plan will be drawn up, evaluating the decisions to be taken in the event of a strengthening of the currency, which will involve a reduction in the mortgage guarantee.

Policy on sale of repossessed assets

Prior to repossession, the team of specialised professionals forming the Real Estate Assets Unit has as its initial task the in-situ inspection of the property in order to perform a Technical Analysis which covers: characteristics, type, description and condition of the property, as well as a study of the market and of prices in the area

Selling prices are established centrally based on objective criteria and reviewed periodically to ensure that they are in line with the market, following the active policy of managing property as quickly and efficiently as possible.

For the sale of real estate assets the Bank has a network of external collaborating property market specialists. These collaborating specialists are selected individually based on considerations of proximity, local knowledge and product suitability. The effectiveness of this network is very closely monitored, with daily contact and evaluation of the level of sales and commitments.

By way of sales support the Bank relies on:

• The branch network, which has a financial incentive to refer possible interested buyers.
• Dedicated property portal on the Bank's website https://www.bankinter.com/ www/es-es/cgi/ebk+inm+home
• The assets are published on the main national portals.
• In-house property magazines, by type of property and location.
• Sales service call centre.

There is an active policy of studying possibilities for disposing of the portfolio as a whole or in batches of repossessed assets.

Land and construction work in progress

As a consequence of the highly restrictive risk policy on financing for property developers, the amount relating to repossessed land is insignificant relative to the size of the Bank and particularly in comparison with the banking sector as a whole. Most of the repossessed land is urban and therefore does not require town planning and management.

Our knowledge of property developers, the size of the developments and the risk policy pursued have allowed us to support developers at least enough to ensure that financed projects are completed, which explains why there are practically no developments in progress among the repossessed assets. In any case, the policy for managing land focuses on establishing controls to prevent impairment of the value of the asset and improving its condition to ensure a quick sale.

Specific examples of these procedures include:

• The selection and control of specialist providers for resolving planning issues with land and unfinished developments, accepting budgets and monitoring their execution.
• Supervision and monitoring of the procedures for obtaining the necessary sale permits from official bodies or town councils.
• Proposing analysis of development viability studies to investors and property promoters.

Policy on financing granted to problematic property developers

Due to the low level of exposure to credit risk on property developers (less than 2% of total customer risk), there is no need to design recovery policies for problematic property development projects. Policy has focused on financing specific, small-scale projects in good locations and with well-established property developers. As a result most of the risk in this sector is on completed developments ready for sale. Projects and selling prices are closely monitored with a view to reducing the risk.

a) Asset transactions

We now go on to present, as at 31 December 2014, the nominal value of the totality of mortgage credits and loans outstanding at that date in the Group entities indicated above, the nominal value of these eligible loans and credits, the mortgage credits and loans covering the issue of mortgage bonds, those that have been issued in the form of mortgage participations or mortgage transfer certificates and noncommitted transactions:

	Nominal value	NPV
1 Total loans	26,555,147
2 Mortgage participations issued	1,589,561
Of which: Loans retained on the balance sheet	860,479
3 Mortgage transmission certificates issued	2,185,370
Of which: Loans retained on the balance sheet	2,079,529
4 Mortgage loans assigned in guarantee of financing received
5 Loans backing the issue of mortgage debentures and bonds	22,780,216
5.1 Non-eligible loans	4,355,673
5.1.1 They meet the eligibility requirements except for the limit of Article 5.1 of RD 716/2009
5.1.2 Other	4,355,673
5.2 Eligible loans	18,424,543
5.2.1 Non-computable amounts
5.2.2 Computable amounts	18,424,543
5.2.2.1 Loans covering issues of mortgage debentures
5.2.2.2 Loans suitable for covering issues of mortgage bonds	18,424,543

	Nominal value	NPV
1 Total loans	26,857,438
2 Mortgage participations issued	1,803,404
Of which: Loans retained on the balance sheet	960,426
3 Mortgage transmission certificates issued	2,439,674
Of which: Loans retained on the balance sheet	2,321,828
4 Mortgage loans assigned in guarantee of financing received
5 Loans backing the issue of mortgage debentures and bonds	22,614,361
5.1 Non-eligible loans	4,512,147
5.1.1 They meet the eligibility requirements except for the limit of Article 5.1 of RD 716/2009
5.1.2 Other	4,512,147
5.2 Eligible loans	18,102,214
5.2.1 Non-computable amounts
5.2.2 Computable amounts	18,102,214
5.2.2.1 Loans covering issues of mortgage debentures
5.2.2.2 Loans suitable for covering issues of mortgage bonds	18,102,214

22,780,216 18,424,543 TOTAL 22,780,216 18,424,543 1 ORIGIN OF TRANSACTIONS 1.1 Originated by the entity 21,012,104 16,891,590 1.2 Subrogated from other entities 1,768,111 1,532,953 1.3. Other - - 22,780,216 18,424,543 2 CURRENCY 2.1 Euros 20,186,145 16,357,530 2.2. Other currencies 2,594,071 2,067,013 3 PAYMENTSITUATION 22,780,216 18,424,543 3.1 Normal 21,887,142 18,224,178 3.2 Other than normal 893,074 200,365 4 AVERAGEREMAININGMATURITY 22,780,216 18,424,543 4.1 Up to ten years 3,407,462 2,585,524 4.2 From ten to twenty years 8,114,517 6,484,488 4.3 From twenty to thirty years 8,922,638 7,506,389 4.4 More than thirty years 2,335,599 1,848,142 5 INTERESTRATES 22,780,216 18,424,543 5.1 Fixed 53,496 24,702 5.2 Variable 22,726,720 18,399,841 5.3 Mixed - - 6 BORROWERS 22,780,216 18,424,543 6.1 Companies and entrepreneurs 4,908,316 3,072,747 Of which: Property developers 483,160 314,468 6.2 Other companies and ISFLSH (Private non-profit making institutions 17,871,900 15,351,796 serving households) 7 TYPE OF GUARANTEE 22,780,216 18,424,543 7.1 Finished assets/buildings 21,798,781 17,863,065 7.1.1 Residential 15,520,164 13,936,479 Of which: State-subsidised housing - - 7.1.2 Commercial 6,278,617 3,926,586 7.1.3 Other - - 7.2 Assets/buildings under construction 580,999 396,386 7.2.1 Residential 22,267 20,315 Of which: State-subsidised housing - - 7.2.2 Commercial 558,732 376,071 7.2.3 Other - - 7.3 Plots of land 400,436 165,092 7.3.1 Developed 277,890 165,092 7.3.2 Other 122,546 -	Loans backing the issue of mortgage debentures and bonds	Of which: Eligible loans

	Loans backing the issue of mortgage debentures and bonds	Of which: Eligible loans
TOTAL	22,614,361	18,102,214
1 ORIGIN OF TRANSACTIONS	22,614,361	18,102,214
1.1 Originated by the entity	20,762,829	16,538,699
1.2 Subrogated from other entities	1,851,532	1,563,515
1.3. Other	-	-
2 CURRENCY	22,614,361	18,102,214
2.1 Euros	19,533,230	15,649,051
2.2. Other currencies	3,081,131	2,453,163
3 PAYMENTSITUATION	22,614,361	18,102,214
3.1 Normal	21,696,543	17,886,505
3.2 Other than normal	917,818	215,709
4 AVERAGEREMAININGMATURITY	22,614,361	18,102,214
4.1 Up to ten years	3,286,478	2,450,561
4.2 From ten to twenty years	7,900,713	6,234,004
4.3 From twenty to thirty years	8,757,846	7,311,655
4.4 More than thirty years	2,669,324	2,105,994
5 INTERESTRATES	22,614,361	18,102,214
5.1 Fixed	61,141	30,537
5.2 Variable	22,553,220	18,071,677
5.3 Mixed	-	-
6 BORROWERS	22,614,361	18,102,214
6.1 Companies and entrepreneurs	4,729,743	2,820,376
Of which: Property developers	529,846	323,465
6.2 Other companies and ISFLSH (Private non-profit making institutions	17,884,618	15,281,838
serving households)
7 TYPE OF GUARANTEE	22,614,361	18,102,214
7.1 Finished assets/buildings	21,810,333	17,674,275
7.1.1 Residential	15,492,824	13,870,776
Of which: State-subsidised housing 7.1.2 Commercial	- 6,317,509	- 3,803,499
7.1.3 Other	-	-
7.2 Assets/buildings under construction	389,498	251,734
7.2.1 Residential	350,548	226,561
Of which: State-subsidised housing	-	-
7.2.2 Commercial	38,950	25,173
7.2.3 Other	-	-
7.3 Plots of land	414,530	176,205
7.3.1 Developed	285,475	176,205
7.3.2 Other	129,055	-

The following is a breakdown of the nominal value of eligible mortgage loans and credits outstanding as at 31 December 2014 and 31 December 2013 by loan to value (LTV) based on the latest available appraisal of the mortgaged property:

31 December 2014

		RISK AS%OF AMOUNT OFLATEST AVAILABLEAPPRAISAL FORMORTGAGEMARKET (loan to value)
TYPE OF GUARANTEE	Equal to or less than 40%	From 40% to 60% incl.	More than 60 %	From 60 % to 80 % incl.	More than 80 %	TOTAL
5 Loans eligible for the issue of mortgage debentures and bonds	6,293,306	7,761,663	-	4,369,574	-	18,424,543
- On residential property	4,114,926	5,472,287		4,369,574	-	13,956,787
- On other assets	2,178,380	2,289,376	-			4,467,756

		RISK AS%OF AMOUNT OFLATEST AVAILABLEAPPRAISAL FORMORTGAGEMARKET (loan to value)
TYPE OF GUARANTEE	Equal to or less than 40%	From 40% to 60% incl.	More than 60 %	From 60 % to 80 % incl.	More than 80 %	TOTAL
5 Loans eligible for the issue of mortgage debentures and bonds	5,953,680	7,583,523	-	4,565,011	-	18,102,214
- On residential property	3,946,660	5,380,357		4,565,011	-	13,892,028
- On other assets	2,007,020	2,203,166	-			4,210,186

Financial year 2014

MOVEMENTS	Eligible loans	Non-eligible loans
1 Opening balance at 31/12/2013	18,102,214	4,512,146
2 Deductions in the period	1,761,002	833,187
2.1 Cancelled at due date	1,189,547	305,396
2.2 Pre-paid	571,455	527,790
2.3 Subrogated by other entities	-	-
2.4. Other	-	-
3 Additions in the period	2,083,332	676,714
3.1 Originated by the entity	1,911,616	650,180
3.2 Subrogated from other entities	71,334	9,629
3.3. Other	100,382	16,905
4 Opening balance at 31/12/2014	18,424,543	4,355,673

31 December 2014:

Mortgage credit and loans	Available balances. Nominal value
Total	467,800
– Potentially eligible	187,717
– Non-eligible	280,083

31 December 2013;

Mortgage credit and loans	Available balances. Nominal value
Total	293,319
– Potentially eligible	142,252
– Non-eligible	151,067

Financial year 2013

MOVEMENTS	Eligible loans	Non-eligible loans
1 Opening balance at 31/12/2012	17,887,503	5,784,014
2 Deductions in the period	2,393,463	1,793,298
2.1 Cancelled at due date	1,718,204	556,045
2.2 Pre-paid	675,259	581,342
2.3 Subrogated by other entities	-	-
2.4. Other	-	655,911
3 Additions in the period	2,608,174	521,430
3.1 Originated by the entity	1,555,523	502,385
3.2 Subrogated from other entities	24,008	4,405
3.3. Other	1,028,643	14,640
4 Opening balance at 31/12/2013	18,102,214	4,512,146

As at 31 December 2014 and 2013 there were no replacement assets in cover of issues of mortgage bonds or debentures in the Group.

b) Liability operations

We present hereunder the aggregate nominal value of the mortgage bonds outstanding as at 31 December 2014 and 2013 issued by the Group, listed by remaining maturity, as well as mortgage participations and mortgage transfer certificates outstanding as at 31 December 2014 and 2013 issued by the Bank listed by remaining maturity:

MORTGAGE-BACKED SECURITIES	Nominal value	NPV	Average remaining maturity
1 Mortgage debentures issued and outstanding	-
2 Mortgage bonds issued	9,390,000
Of which: Not recognised as liabilities in the balance sheet	5,100,200
2.1 Debt securities. Issued in a public offering	9,390,000
2.1.1 Remaining maturity up to one year	750,000
2.1.2 Remaining maturity from one to two years	1,400,000
2.1.3 Remaining maturity from two to three years	2,000,000
2.1.4 Remaining maturity from three to five years	2,090,000
2.1.5 Remaining maturity from five to ten years	3,150,000
2.1.6 Remaining maturity over ten years
2.2 Debt securities. Other issues
2.2.1 Remaining maturity up to one year
2.2.2 Remaining maturity from one to two years
2.2.3 Remaining maturity from two to three years
2.2.4 Remaining maturity from three to five years
2.2.5 Remaining maturity from five to ten years
2.2.6 Remaining maturity over ten years
2.3 Deposits
2.3.1 Remaining maturity up to one year
2.3.2 Remaining maturity from one to two years
2.3.3 Remaining maturity from two to three years
2.3.4 Remaining maturity from three to five years
2.3.5 Remaining maturity from five to ten years
2.3.6 Remaining maturity over ten years
3 Mortgage participations issued	860,479		227
3.1 Issued by means of public offering	860,479		227
3.2. Other issues
4 Mortgage transmission certificates issued	2,079,529		227
4.1 Issued by means of public offering	2,079,529		227
4.2. Other issues

MORTGAGE-BACKED SECURITIES	Nominal value	NPV	Average remaining maturity
1 Mortgage debentures issued and outstanding	-
2 Mortgage bonds issued	11,270,000
Of which: Not recognised as liabilities in the balance sheet	5,884,150
2.1 Debt securities. Issued in a public offering	11,270,000
2.1.1 Remaining maturity up to one year	1,430,000
2.1.2 Remaining maturity from one to two years	1,600,000
2.1.3 Remaining maturity from two to three years	2,100,000
2.1.4 Remaining maturity from three to five years	3,090,000
2.1.5 Remaining maturity from five to ten years	3,050,000
2.1.6 Remaining maturity over ten years
2.2 Debt securities. Other issues
2.2.1 Remaining maturity up to one year
2.2.2 Remaining maturity from one to two years
2.2.3 Remaining maturity from two to three years
2.2.4 Remaining maturity from three to five years
2.2.5 Remaining maturity from five to ten years
2.2.6 Remaining maturity over ten years
2.3 Deposits
2.3.1 Remaining maturity up to one year
2.3.2 Remaining maturity from one to two years
2.3.3 Remaining maturity from two to three years
2.3.4 Remaining maturity from three to five years
2.3.5 Remaining maturity from five to ten years
2.3.6 Remaining maturity over ten years
3 Mortgage participations issued	960,426		229
3.1 Issued by means of public offering	960,426		229
3.2. Other issues
4 Mortgage transmission certificates issued	2,321,828		229
4.1 Issued by means of public offering	2,321,828		229
4.2. Other issues	-

In compliance with the request made by Banco de España for credit institutions to publish their exposure to the construction and property development sector, Bankinter, S.A. publishes the following information as at 31 December 2014 and 31 December 2013, which goes beyond the level of detail and transparency requested:

47. Exposure to the construction and property development sector

Table 1: Financing for property development and its coverage

As at 31 Dec. 2014	Gross amount	Excess over guarantee value (1)	Specific coverage
1. Lending recorded by the group's credit institutions (businesses in Spain)	874,889	75,670	114,181
1.1. Of which: Doubtful	240,376	31,247	107,147
1.2. Of which: Substandard	66,925	7,268	7,034

Information in €000s

As at 31 Dec. 2013	Gross amount	Excess over guarantee value (1)	Specific coverage
1. Lending recorded by the group's credit institutions (businesses in Spain)	848,149	100,509	140,253
1.1. Of which: Doubtful	288,886	41,762	129,809
1.2. Of which: Substandard	87,042	14,205	10,253

Information in €000s

(1) This is the amount of the excess of the gross value of each transaction over the value of any rights in rem received in guarantee, calculated in accordance with the provisions of Appendix IX to Circular 4/2004 (finished habitual residence 80%; offices, shops and multipurpose industrial buildings 70%; other finished housing 60%; other assets 50%)

Table 2: Breakdown of financing for property construction and development

As at 31 Dec. 2014	Financing of property construction and development. Gross amount
Without a mortgage guarantee	137,764
With a mortgage guarantee	737,125
Finished buildings	508,877
Housing	336,443
Other	172,434
Buildings under construction	85,084
Housing	85,084
Other	-
Land	143,164
Urban plots	131,093
Other land	12,071
TOTAL	874,889

Information in €000s

As at 31 Dec. 2013	Financing of property construction and development. Gross amount
Without a mortgage guarantee	115,227
With a mortgage guarantee	732,922
Finished buildings	492,475
Housing	340,237
Other	152,238
Buildings under construction	62,684
Housing	62,684
Other	-
Land	177,763
Urban plots	166,620
Other land	11,143
TOTAL	848,149

Information in €000s

As at 31 Dec. 2014

Memorandum items:
- Total general coverage (all businesses)	-
- Bad debts	56,390
Memorandum items: Figures for the consolidated group
	Carrying amount
1. Total lending to customers excluding Public Administrations (businesses in Spain).	40,742,322
2. Total consolidated assets (all businesses)	57,332,974

Table 3: Lending to households for purchase of residential property

As at 31 Dec. 2014

	Gross amount	Of which: Doubtful
Lending for the purchase of housing	17,308,497	416,840
Without a mortgage guarantee	-	-
With a mortgage guarantee	17,308,497	416,840

Information in €000s

As at 31 Dec. 2013

	Gross amount	Of which: Doubtful
Lending for the purchase of housing	20,861,461	555,850
Without a mortgage guarantee	-	-
With a mortgage guarantee	20,861,461	555,850

As at 31 Dec. 2013

Memorandum items:
- Total general coverage (all businesses)	-
- Bad debts	52,423
Memorandum items: Figures for the consolidated group
	Carrying amount
1. Total lending to customers excluding Public Administrations
(businesses in Spain).	38,966,358
2. Total consolidated assets (all businesses)	55,135,662

Information in €000s

Table 4: Breakdown of mortgage lending to households for the purchase of housing by loan to value (LTV) based on the latest available appraisal.

As at 31 Dec. 2014

</ltv≤100%<></ltv≤80%<></ltv≤60%<></ltv≤100%<></ltv≤80%<></ltv≤100%<>

	LTV brackets (10)
	LTV≤40%	40% <ltv≤60%< th="">	60%<ltv≤80%< th="">	80%<ltv≤100%< th="">	LTV > 100%	Total	60% <ltv≤80%< th="">	80%<ltv≤100%< th="">	LTV > 100%	Total	80% <ltv≤100%< th="">	LTV > 100%	Total	LTV > 100%	Total
Gross amount	4,453,343	6,697,281	5,378,746	742,802	36,325	17,308,497
Of which doubtful	49,427	127,380	187,669	48,031	4,333	416,840

Information in €000s

As at 31 Dec. 2013

</ltv≤100%<></ltv≤80%<></ltv≤60%<></ltv≤100%<></ltv≤80%<></ltv≤100%<>

	LTV brackets (10)
	LTV≤40%	40% <ltv≤60%< td="">	60%<ltv≤80%< td="">	80%<ltv≤100%< td="">	LTV > 100%	Total	60% <ltv≤80%< td="">	80%<ltv≤100%< td="">	LTV > 100%	Total	80% <ltv≤100%< td="">	LTV > 100%	Total	LTV > 100%	Total
Gross amount	7,243,737	7,501,044	5,411,424	664,196	41,060	20,861,461
Of which doubtful	116,474	184,208	207,762	42,813	4,592	555,849

Information in €000s

Table 5: Assets repossessed by consolidated group entities (businesses in Spain)

As at 31 Dec. 2014

	Carrying	Of which:
	amount	Coverage	Initial cost	Gross Debt
1. Real estate assets from financing transactions for property construction and development companies	123,768	50,229	249,639	173,997
1.1. Finished buildings	68,176	20,369	115,731	88,545
1.1.1. Housing	34,134	8,568	57,604	42,702
1.1.2. Other	34,042	11,801	58,127	45,843
1.2. Buildings under construction	6,103	147	10,072	6,250
1.2.1. Housing	6,103	147	10,072	6,250
1.2.2. Other	-	-	-	-
1.3. Land	49,488	29,713	123,836	79,201
1.3.1. Urban plots	49,488	29,713	123,836	79,201
1.3.2. Other land	-	-	-	-
2. Real estate assets from mortgage financing operations to households for the purchase of housing	109,228	12,751	152,142	121,979
3. Other real estate assets foreclosed	122,598	14,052	182,424	136,650
4. Other equity instruments, securities and financing to non-consolidated companies holding said assets	45	2,595	8,925	2,640
Information in €000s

As at 31 Dec. 2013

	Carrying	Of which:
	amount	Coverage	Initial cost	Gross Debt
1. Real estate assets from financing transactions for property construction and development companies	147,114	72,787	219,901	300,429
1.1. Finished buildings	92,264	41,498	133,762	170,991
1.1.1. Housing	55,050	22,176	77,226	101,133
1.1.2. Other	37,214	19,322	56,536	69,858
1.2. Buildings under construction	5,193	264	5,457	9,682
1.2.1. Housing	5,193	264	5,457	9,682
1.2.2. Other	-	-	-	-
1.3. Land	49,657	31,025	80,682	119,756
1.3.1. Urban plots	49,657	31,025	80,682	119,756
1.3.2. Other land	-	-	-	-
2. Real estate assets from mortgage financing operations to households for the purchase of housing	100,988	14,888	115,876	140,773
3. Other real estate assets foreclosed	120,926	19,382	140,308	186,256
4. Other equity instruments, securities and financing to non-consolidated companies holding said assets	204	2,436	2,640	8,925

48. Additional Information on risks: Refinancing and restructuring transactions: Geographical and sector risk concentration.

In compliance with Banco de España's request per Circular 6/2012 for credit institutions to publish information on refinancing and restructuring transactions, as well as on sector and geographical risk concentration.

The policy on refinancing and restructuring established by the Bank is described in Note 45.

The following is a breakdown by counterparty, type of insolvency and type of security held, of balances of restructuring and refinancing transactions carried out by the Bank and outstanding as at 31 December 2014 and 2013.

Refinancing and restructuring transactions:

Outstanding balances of refinancing and restructuring transactions as at 31 December 2014:

	NORMAL (b)							SUBSTANDARD
	Fully secured by property mortgage		Other tangible security (c)		Without tangible security		Fully secured by property mortgage		Other tangible security (c)		Without tangible security
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	Specific coverage
1. Public Administrations	-	-	-	-	1	8,820	-	-	-	-	-	-	-
2. Remaining companies and sole proprietors	834	352,699	74	19,670	613	92,852	293	121,142	18	8,160	77	40,407	12,913
Of which: Financing of property construction and development.	93	54,782	8	6,764	10	12,186	30	36,897	2	1,273	1	672	2,744
3. Other Private Individuals	1,107	197,376	48	11,322	312	5,255	482	105,296	9	2,204	71	836	2,696
4. Total	1,941	550,075	122	30,992	926	106,927	775	226,438	27	10,364	148	41,243	15,609

Refinancing and restructuring transactions:

Outstanding balances of refinancing and restructuring transactions as at 31 December 2014:

	Fully secured by property mortgage		Other tangible security (c)			Without tangible security		TOTAL
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	Specific coverage	No. of transactions	Gross amount	Specific coverage
1. Public Administrations	-	-	-	-	-	-	-	1	8,820	-
2. Remaining companies and sole proprietors	725	343,209	80	36,207	1,050	176,016	270,010	3,764	1,190,362	282,923
Of which: Financing of property construction and development.	157	137,571	21	11,001	34	4,786	69,490	356	265,932	72,234
3. Other Private Individuals	502	108,121	26	7,671	259	6,505	17,245	2,816	444,586	19,941
4. Total	1,227	451,330	106	43,878	1,309	182,521	287,255	6,581	1,643,768	302,864

Outstanding balances of refinancing and restructuring transactions as at 31 December 2013:

	NORMAL (b)									SUBSTANDARD
	Fully secured by property mortgage		Other tangible security (c)		Without tangible security		Fully secured by property mortgage		Other tangible security (c)		Without tangible security
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	Specific coverage
1. Public Administrations	-	-	-	-	1	9,203	-	-	-	-	-	-	-
2. Remaining companies and sole proprietors	712	318,547	85	25,991	738	119,780	409	162,323	20	15,761	138	126,513	33,146
Of which: Financing of property construction and development.	77	45,893	8	6,609	6	13,865	47	52,089	5	5,557	2	714	5,750
3. Other Private Individuals	834	162,813	46	11,650	324	4,963	515	107,192	14	2,258	104	1,405	2,909
4. Total	1,546	481,360	131	37,641	1,063	133,946	924	269,515	34	18,019	242	127,918	36,055

Outstanding balances of refinancing and restructuring transactions as at 31 December 2013:

			DOUBTFUL
	Fully secured by property mortgage		Other tangible security (c)		Without tangible security				TOTAL
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount	Specific coverage	No. of transactions	Gross amount	Specific coverage
1. Public Administrations	-	-	-		-	-	-	1	9,203	-
2. Remaining companies and sole proprietors	714	369,921	73	41,276	928	161,722	259,941	3,817	1,341,834	293,087
Of which: Financing of property construction and development.	166	156,492	23	15,191	32	4,176	80,940	366	300,586	86,690
3. Other Private Individuals	356	82,483	20	5,191	217	4,960	10,869	2,430	382,915	13,778
4. Total	1,070	452,404	93	46,467	1,145 166,682		270,810	6,248	1,733,952	306,865

Breakdown of amount of transactions classed as doubtful subsequent to refinancing

or restructuring during the year.

	Fully secured by property mortgage			Other tangible security (c)	Without tangible security
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount
Companies and sole proprietors	161	58,710	13	2,944	238	43,881
Of which: Financing of property construction and development.	25	15,255	3	1,159	2	286
Private individuals	154	27,901	6	1,169	66	1,110
Total	315	86,611	19	4,113	304	44,991

Breakdown of amount of transactions classed as doubtful subsequent to refinancing

or restructuring during the previous year.

	Fully secured by property mortgage			Other tangible security (c)	Without tangible security
	No. of transactions	Gross amount	No. of transactions	Gross amount	No. of transactions	Gross amount
Companies and sole proprietors	364	132,250	32	12,009	485	61,120
Of which: Financing of property construction and development.	41	33,364	6	1,709	4	44
Private individuals	262	54,572	12	2,205	112	1,899
Total	626	186,822	44	14,214	597	63,019

Breakdown of the average probability of default (PD) of refinanced and restructured

transactions by segment

2014:

		NORMAL					SUBSTANDARD
	Fully secured by property mortgage		Other tangible security		Without tangible security		Fully secured by property mortgage		Other tangible security		Without tangible security
	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD
1. Public Administrations	-	-		-	-	-	-	-	-	-	-	-
2. Remaining companies and sole proprietors	834	0.31	74	0.27	613	0.32	293	0.34	18	0.18	77	0.24
Of which: Financing of property construction and development.	93	0.05	8	0.00	10	0.17	30	0.07	2	0.19	1	0.13
3. Other Private Individuals	1,107	0.24	48	0.22	312	0.30	482	0.24	9	0.51	71	0.52
4. Total	1,941	0.27	122	0.26	925	0.31	775	0.28	27	0.31	148	0.32

2014:

		Mortgage guarantee	DOUBTFUL	Other guarantees	Without tangible security		TOTAL
	No. of transactions	full PD	No. of transactions	tangible PD	No. of transactions	PD	No. of transactions	PD
1. Public Administrations
2. Remaining companies and sole proprietors	725	0.73	80	0.84	1,050	1.00	3,764	0.54
Of which: Financing of property construction and development.	157	0.28	21	0.48	34	1.00	356	0.17
3. Other Private Individuals	502	0.98	26	0.85	259	0.98	2,816
4. Total	1,227	0.82	106	0.84	1,309	1.00	6,580	0.49

2013:

			NORMAL					SUBSTANDARD
	Fully secured by property mortgage		Other tangible security		Without tangible security		Fully secured by property mortgage		Other tangible security		Without tangible security
	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD
1. Public Administrations	-	-	-	-	-	-	-	-	-	-	-	-
2. Remaining companies and sole proprietors	443	0.39	44	0.26	480	0.30	269	0.38	8	0.13	66	0.33
Of which: Financing of property construction and development.	45	0.36	3	0.00	1	1	24	0.40	2	0.04	1	0.18
3. Other Private Individuals	689	0.26	25	0.15	312	0.10	444	0.23	10	0.27	102	0.41
4. Total	1,132	0.32	69	0.22	792	0.26	713	0.31	18	0.21	168	0.35

	DOUBTFUL
	Fully secured by property mortgage		Other tangible security		Without tangible security		TOTAL
	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD	No. of transactions	PD
1. Public Administrations
2. Remaining companies and sole proprietors	359	0.99	22	0.97	460	1.00	2,151	0.66
Of which: Financing of property construction and development.	52	1.00	3	0.89	10	1.00	141	0.67
3. Other Private Individuals	286	0.97	11	1.00	206	0.80	2,085	0.41
4. Total	645	0.98	33	0.97	666	0.98	4,236	0.56

Geographical and sector risk concentration.

The following is a breakdown of the carrying amount of the Group's most significant financial assets as at 31 December 2014 and 2013 by geographical area of activity, business segment, counterparty and purpose for which the financing was granted.

Breakdown of customer lending by activity (carrying amount). Financial year 2014

			Of which:			Collateralised loans. Loan to value (f)
	TOTAL	Of which: Secured by property (e)	Other tangible security (e)	Equal to or less than 40%	From 40% to 60% incl.	From 60 % to 80 % incl.	From 80% to 100 % incl.	More than 100%
1 Government Bodies	1,704,401	5,419	-	5,419	-	-	-	-
2 Other financial institutions	2,488,865	7,967	1,973,151	3,768	8,525	-	1,968,129	696
3 Non-financial companies and sole proprietors	19,525,475	7,544,944	650,308	2,706,208	2,868,153	1,750,264	396,612	474,015
3.1 Property construction and development	775,941	656,114	17,271	139,562	219,769	231,792	36,301	45,961
3.2 Civil engineering construction	280,557	12,838	385	5,302	5,378	1,761	408	374
3.3 Other purposes	18,468,977	6,875,992	632,652	2,561,344	2,643,006	1,516,711	359,903	427,680
3.3.1 Major corporates	6,121,714	701,031	62,037	183,275	228,337	200,131	68,095	83,230
3.3.2 SMEs and sole proprietors	12,347,263	6,174,961	570,615	2,378,069	2,414,669	1,316,580	291,808	344,450
4 Other home and ISFLSH (Private non-profit institutions serving households)	20,695,162	19,173,552	157,888	5,426,895	7,475,950	5,573,202	631,651	223,742
4.1 Residential properties	17,612,128	17,452,820	33,794	4,682,318	6,827,163	5,240,258	573,531	163,344
4.2. Consumer	626,325	17,456	1,611	7,961	7,277	3,014	300	515
4.3 Other purposes	2,456,709	1,703,276	122,483	736,616	641,510	329,930	57,820	59,883
SUBTOTAL	44,413,903	26,731,882	2,781,347	8,142,290	10,352,628	7,323,466	2,996,392	698,453
5 Less: Value corrections due to asset impairment not attributable to specific transactions	-
6 TOTAL	44,413,903
MEMORANDUMACCOUNTS
Refinancing, refinanced and restructured transactions:	1,345,786	1,148,410	19,673	304,862	355,625	349,225	107,646	50,725

				Collateralised loans. Loan to value Equal to or From 80%
Financial year 2013 Information in 000s euros	TOTAL	Of which: Secured by property	Of which: Other tangible security	less than 40%	From 40% to 60% incl.	From 60 % to 80% incl.	to 100% incl.	More than 100%
1 Government Bodies	2,340,651	6,804	-	290	-	-	6,514	-
2 Other financial institutions	1,397,106	6,396	11,519	2,166	3,019	11,519	-	1,211
3 Non-financial companies and sole proprietors	17,931,104	7,382,687	571,193	2,715,320	2,732,550	1,696,643	407,386	401,981
3.1 Property construction and development	750,427	654,089	18,094	171,372	189,133	229,925	30,801	50,952
3.2 Civil engineering construction	309,215	26,838	1,138	8,330	13,864	2,612	1,812	1,358
3.3 Other purposes	16,871,462	6,701,760	551,961	2,535,618	2,529,553	1,464,106	374,773	349,671
3.3.1 Major corporates	5,610,765	620,376	129,135	202,504	148,072	243,941	86,586	68,408
3.3.2 SMEs and sole proprietors	11,260,697	6,081,384	422,826	2,333,114	2,381,481	1,220,165	288,188	281,263
4 Other home and ISFLSH (Private non-profit institutions serving households)	20,617,588	19,265,913	111,071	5,485,753	7,225,205	5,790,866	655,491	219,668
4.1 Residential properties	14,829,459	14,712,559	6,383	3,823,806	5,448,756	4,789,359	526,530	130,491
4.2. Consumer	580,598	19,161	890	8,459	7,214	3,930	297	151
4.3 Other purposes	5,207,531	4,534,193	103,798	1,653,488	1,769,235	997,577	128,664	89,026
SUBTOTAL	42,286,449	26,661,800	693,783	8,203,529	9,960,774	7,499,028	1,069,392	622,860
5 Less: Value corrections due to asset impairment not attributable to specific transactions	-
6 TOTAL	42,286,449
MEMORANDUMACCOUNTS
Refinancing, refinanced and restructured transactions:	1,432,661	1,129,907	29,181	305,823	310,958	374,192	109,629	58,486

Concentration of risks by Activity and Geographical Area (Carrying amounts). Total activity.

Financial year 2014 Information in 000s euros	TOTAL	Spain	Rest of the European Union	The Americas	Rest of the world
1. Credit institutions	2,775,402	1,797,072	714,716	24,457	239,157
2 Government Bodies	8,421,059	8,079,990	341,059	10	-
2.1 Central Administration	7,374,674	7,033,609	341,059	5	-
2.2. Other	1,046,385	1,046,380	-	5	-
3 Other financial institutions	3,580,246	3,155,484	316,611	105,199	2,952
4 Non-financial companies and sole proprietors	22,278,321	21,551,357	501,642	180,283	45,039
4.1 Property construction and development (b)	780,449	775,923	-	4,526	-
4.2 Civil engineering construction	559,183	515,155	16,292	27,686	50
4.3 Other purposes	20,938,688	20,260,279	485,350	148,071	44,989
4.3.1 Major corporates (c)	8,244,450	7,647,351	441,548	118,723	36,829
4.3.2 SMEs and sole proprietors (c)	12,694,238	12,612,928	43,802	29,348	8,160
5 Other home and ISFLSH (Private non-profit institutions serving households)	21,102,211	20,498,049	438,477	47,389	118,296
5.1 Residential properties (d)	17,637,130	17,077,067	401,191	44,160	114,712
5.2. Consumer (d)	626,325	624,536	777	493	519
5.3 Other purposes (d)	2,838,756	2,796,446	36,509	2,736	3,065
SUBTOTAL	58,157,239	55,081,952	2,312,505	357,338	405,444
6 Less: Value corrections due to asset impairment not attributable to specific transactions	-
7 TOTAL	58,157,239

Concentration of risks by Activity and Geographical Area (Carrying amounts). Activity in Spain.

Information in 000s euros	TOTAL	Andalusia	Aragón	Asturias	Balearic Islands	Canary Islands	Cantabria	Castile - La Mancha	Castilla y León	Catalonia
1 Credit institutions	1,797,072	1,014	109,638	1	22,353	7	86,692	3	5	355,644
2 Government Bodies	8,079,990	123,050	19,186	40,569	5,005	26,880	5,520	37,230	135,020	64,597
2.1 Central Administration	7,033,609
2.2. Other	1,046,380	123,050	19,186	40,569	5,005	26,880	5,520	37,230	135,020	64,597
3 Other financial institutions	3,155,484	596	658	1,342	78	24	26	19	8,254	34,239
4 Non-financial companies and sole proprietors	21,551,357	2,585,306	806,947	483,687	562,226	788,188	257,993	542,423	581,297	2,720,516
4.1 Property construction and development	775,923	127,646	53,871	12,761	31,987	15,087	20,914	5,158	32,263	53,505
4.2 Civil engineering construction	515,155	57,341	13,247	2,455	12,151	30,341	16,280	9,202	9,786	54,507
4.3 Other purposes	20,260,279	2,400,319	739,829	468,471	518,088	742,760	220,799	528,063	539,248	2,612,504
4.3.1 Major corporates	7,647,351	541,509	190,896	86,596	241,615	238,624	47,637	62,816	167,478	1,105,514
4.3.2 SMEs and sole proprietors	12,612,928	1,858,810	548,933	381,875	276,473	504,136	173,162	465,247	371,770	1,506,990
5 Other home and ISFLSH (Private non-profit institutions serving households)	20,498,049	2,412,164	456,407	290,077	526,974	751,083	276,964	676,193	850,775	3,037,811
5.1 Residential properties	17,077,067	1,993,233	373,945	234,972	474,119	646,305	235,105	580,240	754,711	2,587,873
5.2. Consumer	624,536	87,953	11,961	12,419	12,932	33,737	8,490	20,529	30,051	85,177
5.3 Other purposes	2,796,446	330,978	70,501	42,686	39,923	71,041	33,369	75,424	66,013	364,761
SUBTOTAL	55,081,952	5,122,130	1,392,836	815,675	1,116,636	1,566,182	627,195	1,255,868	1,575,350	6,212,807
6 Less: Value corrections due to asset impairment not attributable to specific transactions	-
7 TOTAL	55,081,952

Information in 000s euros	TOTAL	Extremadura	Galicia	Madrid	Murcia	Navarra	Valencia Autonomous Region	Basque Country	La Rioja	Ceuta and Melilla
1 Credit institutions	1,797,072	-	379	876,048	1	11,005	237,266	97,014	2	-
2 Government Bodies	8,079,990	59,978	64,339	231,456	8,920	57,266	14,199	110,304	38,005	4,857
2.1 Central Administration	7,033,609
2.2. Other	1,046,380	59,978	64,339	231,456	8,920	57,266	14,199	110,304	38,005	4,857
3 Other financial institutions	3,155,484	-	195	3,093,091	291	7	3,216	13,422	26	-
4 Non-financial companies and sole proprietors	21,551,357	191,458	498,424	6,863,334	644,599	355,959	1,926,889	1,519,938	214,989	7,185
4.1 Property construction and development	775,923	4,704	9,691	191,688	43,660	11,575	108,286	25,043	28,084	-
4.2 Civil engineering construction	515,155	24,468	18,642	151,383	9,935	11,469	39,463	52,184	2,301	-
4.3 Other purposes	20,260,279	162,286	470,091	6,520,263	591,004	332,915	1,779,140	1,442,711	184,604	7,185
4.3.1 Major corporates	7,647,351	59,939	165,642	3,344,353	171,583	101,078	417,531	676,936	27,605	-
4.3.2 SMEs and sole proprietors	12,612,928	102,347	304,449	3,175,910	419,421	231,837	1,361,609	765,775	156,999	7,185
5 Other home and ISFLSH (Private non-profit institutions serving households)	20,498,049	149,094	411,527	7,365,954	364,814	139,137	1,680,646	1,004,513	97,497	6,422
5.1 Residential properties	17,077,067	123,834	332,156	5,948,486	313,478	115,938	1,433,632	841,632	82,962	4,446
5.2. Consumer	624,536	8,185	23,918	191,074	13,202	3,907	60,819	16,270	2,236	1,679
5.3 Other purposes	2,796,446	17,075	55,453	1,226,394	38,134	19,292	186,195	146,611	12,299	297
SUBTOTAL	55,081,952	400,530	974,864	18,429,883	1,018,625	563,373	3,862,216	2,745,191	350,519	18,464
6 Less: Value corrections due to asset impairment not attributable to specific transactions	-
7 TOTAL	55,081,952

Financial year 2013 TOTAL Spain Rest of the European Union The Americas Rest of the world Information in 000s euros 1 Credit institutions 3,308,621 2,113,930 1,058,048 132,789 3,854 2 Government Bodies 8,429,541 8,399,082 30,447 12 - 2.1 Central Administration 7,189,841 7,159,388 30,447 6 - 2.2. Other 1,239,700 1,239,694 - 6 - 3 Other financial institutions 2,085,633 2,028,171 42,468 10,237 4,757 4 Non-financial companies and sole proprietors 20,559,406 20,054,811 317,175 173,940 13,480 4.1 Property construction and development 787,293 787,292 - 1 - 4.2 Civil engineering construction 825,247 747,254 10,506 67,487 - 4.3 Other purposes 18,946,866 18,520,265 306,669 106,452 13,480 4.3.1 Major corporates 7,352,269 6,965,167 281,785 97,714 7,603 4.3.2 SMEs and sole proprietors 11,594,597 11,555,098 24,884 8,738 5,877 5 Other home and ISFLSH (Private non-profit institutions serving households) 20,815,210 20,243,392 439,650 34,426 97,742 5.1 Residential properties 15,026,966 14,552,060 356,709 27,846 90,351 5.2. Consumer 580,602 579,129 637 380 456 5.3 Other purposes 5,207,642 5,112,203 82,304 6,200 6,935 SUBTOTAL 55,198,411 52,839,386 1,887,789 351,405 119,831 6. Less: value corrections due to asset impairment not attributable to specific transactions - 7 TOTAL 55,198,411

Concentration of risks by Activity and Geographical Area (Carrying amounts). Total activity.

Concentration of risks by Activity and Geographical Area (Carrying amounts). Activity in Spain.

Information in 000s euros	TOTAL	Andalusia	Aragón	Asturias	Balearic Islands	Canary Islands	Cantabria	Castile - La Mancha	Castilla y León	Catalonia
1 Credit institutions	2,113,930	118,650	16,980	832	12,906	3	114,188	1	8	584,385
2 Government Bodies	8,399,082	185,709	27,466	40,633	36,283	44,151	5,732	72,748	76,014	129,721
2.1 Central Administration	7,159,388
2.2. Other	1,239,694	185,708	27,466	40,633	36,283	44,151	5,732	72,748	76,014	129,721
3 Other financial institutions	2,028,171	89	334	54	14	3	67	20	156	35,780
4 Non-financial companies and sole proprietors	20,054,811	2,454,839	736,724	284,184	420,082	759,556	259,175	502,537	506,291	2,424,087
4.1 Property construction and development	787,292	134,312	51,291	10,847	24,435	16,763	22,850	5,508	33,217	42,502
4.2 Civil engineering construction	747,254	95,219	13,023	2,540	11,326	35,487	26,792	7,622	18,391	102,909
4.3 Other purposes	18,520,265	2,225,308	672,410	270,797	384,321	707,306	209,533	489,407	454,683	2,278,676
4.3.1 Major corporates	6,965,167	442,378	133,253	35,613	160,434	213,481	43,005	63,293	112,991	911,637
4.3.2 SMEs and sole proprietors	11,555,098	1,782,930	539,157	235,184	223,887	493,825	166,528	426,114	341,692	1,367,039
5 Other home and ISFLSH (Private non-profit institutions serving households)	20,243,392	2,393,940	464,962	300,787	535,776	802,018	284,163	688,318	865,107	3,045,600
5.1 Residential properties	14,552,060	1,701,319	319,372	202,039	400,331	585,520	222,312	490,190	700,859	2,210,826
5.2. Consumer	579,129	85,542	11,177	12,512	12,221	31,958	7,797	19,631	29,346	81,519
5.3 Other purposes	5,112,203	607,079	134,413	86,236	123,224	184,540	54,054	178,497	134,902	753,255
SUBTOTAL	52,839,386	5,153,227	1,246,466	626,490	1,005,061	1,605,731	663,325	1,263,624	1,447,576	6,219,573
6 Less: Value corrections due to asset impairment not attributable to specific transactions	-
7 TOTAL	52,839,386

Concentration of risks by Activity and Geographical Area (Carrying amounts). Activity in Spain.

Information in 000s euros	TOTAL	Extremadura	Galicia	Madrid	Murcia	Navarra	Valencia Autonomous Region	Basque Country	La Rioja	Ceuta and Melilla
1 Credit institutions	2,113,930	1	45,804	879,955	3	12,049	194,477	133,687	1	-
2 Government Bodies	8,399,082	35,967	37,047	155,185	32,160	91,057	129,302	112,960	21,938	5,622
2.1 Central Administration	7,159,388
2.2. Other	1,239,694	35,967	37,047	155,185	32,160	91,057	129,302	112,960	21,938	5,622
3 Other financial institutions	2,028,171	-	41	1,944,460	506	105	30,040	16,470	32	-
4 Non-financial companies and sole proprietors	20,054,811	156,247	477,306	6,913,321	579,977	349,479	1,714,572	1,311,455	199,439	5,540
4.1 Property construction and development	787,292	5,379	10,714	207,944	50,360	8,068	109,435	23,003	30,664	-
4.2 Civil engineering construction	747,254	28,725	22,084	258,987	13,509	13,197	35,829	58,986	2,628	-
4.3 Other purposes	18,520,265	122,143	444,508	6,446,390	516,108	328,214	1,569,308	1,229,466	166,147	5,540
4.3.1 Major corporates	6,965,167	33,726	197,257	3,410,266	199,313	112,148	355,977	517,522	22,873	-
4.3.2 SMEs and sole proprietors	11,555,098	88,417	247,251	3,036,124	316,795	216,066	1,213,331	711,944	143,274	5,540
5 Other home and ISFLSH (Private non-profit institutions serving households)	20,243,392	149,703	415,635	6,971,825	369,695	130,705	1,715,552	1,009,260	92,911	7,435
5.1 Residential properties	14,552,060	107,572	281,042	4,878,554	275,752	92,560	1,215,814	790,555	72,253	5,190
5.2. Consumer	579,129	7,990	21,814	163,555	12,576	3,687	57,793	16,430	1,953	1,628
5.3 Other purposes	5,112,203	34,141	112,779	1,929,716	81,367	34,458	441,945	202,275	18,705	617
SUBTOTAL	52,839,386	341,918	975,833	16,864,746	982,341	583,395	3,783,943	2,583,832	314,321	18,597
6 Less: Value corrections due to asset impairment not attributable to specific transactions	-
7 TOTAL	52,839,386

49. Information by segments

The Group is divided into Retail Banking, Business Banking and Línea Directa Aseguradora (LDA): The ultimate authorities for taking operational decisions are the Management Committee of Bankinter, S.A. for the Commercial banking and Business Banking segments, and the Management Committee of LDA for Línea Directa Aseguradora.

• Based on similarities in the nature of products and services offered, the type of target customer and distribution methods, Commercial Banking comprises:
• - Private Banking is a business line that specialises in comprehensive advisory and management services for high net worth individuals and investors. It caters to customers with financial assets of over €1 million with Bankinter and elsewhere.
• - Personal Banking Customers not included in Private Banking and having:
  • Annual household income of more than €70,000
  • or Deposits + Securities + Intermediation of between €75,000 and €1,000,000
  • or Financial assets with Bankinter and elsewhere of between €75,000 and €1,000,000
• - Retail Banking comprises the products and services offered to households. Other Private Individuals
• - Foreign customers: Non-Spanish Europeans customers of any of the following. Regional Headquarters Catalonia, Levante, Balearic Islands, Andalusia and Canary Islands.

• - Obsidiana: Consumer financing

• Corporate Banking offers a specialised service demanded by big companies, the public sector and SMEs. - Based on similarities in the nature of products and services offered, the type of target customer and distribution methods, this segment covers all the Bank's activity with businesses.

• Línea Directa Aseguradora (LDA): includes the insurance business of the LDA subgroup.

Appendix II shows more information on segments.

50. Holdings in the capital of credit institutions

In accordance with the provisions of Article 20 of Royal Decree 1245/1995 of 14 July, we present hereunder a list of the Group's investments in the capital of national and foreign credit

institutions that exceed 5% of capital or voting rights in same:
	Percentage of Holding
Bankinter Consumer Finance, E.F.C., S.A.	100%
Bankinter Luxembourg, S.A.	100%

In accordance with the provisions of Article 20 of Royal Decree 1245/1995 of 14 July relating to holdings in the capital of credit institutions equal to 5% or more of the capital or voting rights and which are held by national or foreign credit institutions or by groups, as defined by Article 4 of the Securities Market Act, to which a national or foreign credit institution belongs, as at 31 December 2014 no such institution or group held such percentage in the Bank's capital or voting rights.

51. Subsequent events

No events having a significant effect on these consolidated financial statements have occurred between the end of the reporting period and the date on which these statements were approved.

APPENDIX I - Related Party Transactions

		€000s
		2014
Related party income and expense	Significant Shareholders	Directors and Managers	Persons, companies or entities in the Group	Other related parties	Total
Expenses:
Financial expenses	1	226	-	553	780
Management or collaboration contracts	-	-	-	-	-
R&D transfers and licensing agreements	-	-	-	-	-
Leases	-	-	-	-	-
Receipt of services	-	-	-	-	-
Purchase of assets (finished or in progress)	-	-	-	-	-
Value corrections for bad and doubtful debts	-	-	-	-	-
Dividends paid	-	-	-	-	-
Other expenses	-	-	-	-	-
	1	226	-	553	780
Revenues:
Financial revenues	-	-	-	-	-
Management or collaboration contracts	-	-	-	-	-
R&D transfers and licensing agreements	-	-	-	-	-
Dividends received	-	-	-	26,539	26,539
Leases	-	-	-	-	-
Provision of services	-	-	-	-	-
Sale of assets (finished or in progress)	-	-	-	-	-
Gains on cancellation or disposal of assets	-	-	-	-	-
Other income	-	-	-	-	-
	-	-	-	26,539	26,539

APPENDIX I (cont.)

	€000s
		31/12/2014
Other Transactions	Significant Shareholders	Directors and Managers	Persons, companies or entities in the Group	Other related parties	Total
Purchases of tangible, intangible or other assets	-	-	-	-	-
Financing, loan and capital contribution agreements (lender) increases (lender)	-	22,294	-	23,864	46,158
Finance leases	-	-	-	-	-
Amortisation or cancellation of loans and financial
lease contracts (lessor)	-	-	-	-	-
Sales of tangible, intangible or other
assets	-	-	-	-	-
Financing, loan and capital contribution agreements (borrower)	-	-	-	67,718	67,718
increases (borrower)
Finance leases (	-	-	-	-	-
Amortisation or cancellation of loans and	-	-	-	-	-
financial lease contracts (lessee)
Guarantees issued	19,370	390	-	-	19,760
Guarantees received	-	-	-	-	-
Commitments acquired	-	-	-	-	-
Commitments/guarantees cancelled	-	-	-	-	-
Dividends and other distributed profits	4,754	22,684	-	-	27,438
Other transactions	-	-	-	-	-

APPENDIX I (cont.)

			€000s
			2013
Related party income and expense	Significant Shareholders	Directors and Managers	Persons, companies or entities in the Group	Other related parties	Total
Expenses:
Financial expenses	-	364	-	572	936
Management or collaboration contracts	-	-	-	-	-
R&D transfers and licensing agreements	-	-	-	-	-
Leases	-	-	-	-	-
Receipt of services	-	-	-	-	-
Purchase of assets (finished or in progress)	-	-	-	-	-
Value corrections for bad and doubtful debts	-	-	-	-	-
Dividends paid	-	-	-	-	-
Other expenses	-	-	-	-	-
	-	364	-	572	936
Revenues:
Financial revenues	-	-	-	-	-
Management or collaboration contracts	-	-	-	-	-
R&D transfers and licensing agreements	-	-	-	-	-
Dividends received	-	-	-	16,067	16,067
Leases	-	-	-	-	-
Provision of services	-	-	-	-	-
Sale of assets (finished or in progress)	-	-	-	-	-
Gains on cancellation or disposal of assets	-	-	-	-	-
Other income	-	-	-	-	-
	-	-	-	16,067	16,067

APPENDIX I (cont.)

	€000s
			31/12/2013
Other Transactions	Significant Shareholders	Directors and Managers	Persons, companies or entities in the Group	Other related parties	Total
Purchases of tangible, intangible or other assets	-	-	-	-	-
Financing, loan and capital contribution agreements (lender)
increases (lender)	-	26,175	-	27,113	53,288
Financial lease contracts (lessor)	-	-	-	-	-
Amortisation or cancellation of loans and financial	-	-	-	-	-
lease contracts (lessor)
Sales of tangible, intangible or other	-	-	-	-	-
assets
Financing, loan and capital contribution agreements (borrower)	-	-	-	153,190	153,190
increases (borrower)
Finance leases (lessee)	-	-	-	-	-
Amortisation or cancellation of loans and	-	-	-	-	-
financial lease contracts (lessee)					-
Guarantees issued	19,270	390	-	390	20,050
Guarantees received	-	-	-	-	-
Commitments acquired	-	-	-	-	-
Commitments/guarantees cancelled	-	-	-	-	-
Dividends and other distributed profits	3,257	16,119	-	-	19,376
Other transactions	-	3,374	-	-	3,374

APPENDIX II - SegmentedInformation

Financial year 2014	Commercial Banking (Not including Obsidiana)	Business Banking	LDA	Other Businesses	Total
NET INTEREST INCOME	106,978	371,023	40,363	236,993	755,358
Return on other equity instruments			2,008	5,995	8,004
Equity accounting			-	16,962	16,962
Fees and Commissions	163,326	136,520	1,062	-9,502	291,407
Trading income	10,090	17,385	2,139	103,681	133,296
Other operating products/expenses	-9,147	-898	293,379	-39,537	243,797
GROSS INCOME	271,248	524,030	338,953	314,592	1,448,823
Transformation costs	153,325	106,981	204,983	253,958	719,247
Losses from asset impairment	72,797	135,530	-	29,181	237,508
Provisions				41,536	41,536
PROFIT FROM OPERATIONS	45,127	281,519	133,970	-10,083	450,533
Other gains (net)	20,144	37,536	40	-	57,694
GROSS RESULT	24,983	243,983	133,930	-10,083	392,839
Average assets for the segment	24,375,473	18,890,837	1,321,259		44,587,569
Average liabilities for the segment	17,681,102	11,156,041	972,295		29,809,438
Average off-balance sheet resources	12,402,075	961,614			13,363,689
Costs incurred in acquiring assets	4,608	2,756			7,363
Segment-to-segment net turnover	-110,559	-55,107		165,667	-
Services provided	16,139	9,963		-26,102	-
Services received	-126,698	-65,070		191,769	-

Amounts for the previous year adapted to analytical criteria in force in 2014

APPENDIXII (cont.)

Financial year 2013	Commercial Banking (Not including Obsidiana)	Business Banking	LDA	Other Businesses	Total
NET INTEREST INCOME	22,984	312,994	44,043	255,882	635,903
Return on other equity instruments			1,912	7,034	8,946
Equity accounting			-	15,545	15,545
Fees and Commissions	149,770	128,346	284	-29,380	249,020
Trading income	10,571	16,933	2,937	198,314	228,755
Other operating products/expenses	-25,626	-10,795	275,084	-37,833	200,830
GROSS INCOME	157,699	447,478	324,260	409,562	1,338,999
Transformation costs	145,053	96,968	193,594	244,231	679,846
Losses from asset impairment Provisions	82,640	228,073	-	-20,745 14,259	289,968 14,259
PROFIT FROM OPERATIONS	-69,994	122,437	130,666	171,817	354,926
Other gains (net)	24,258	68,994	2,153	-	93,822
GROSS RESULT	-94,252	53,443	128,513	171,817	261,105
Average assets for the segment	24,795,206	17,660,875	1,321,259		43,777,340
Average liabilities for the segment	15,735,777	10,811,623	972,295		27,519,695
Average off-balance sheet resources	9,335,653	892,562			10,228,215
Costs incurred in acquiring assets	4,881	2,773			7,654
Segment-to-segment net turnover	-95,545	-47,097		142,642	-
Services provided	17,375	10,337		-27,712	-
Services received	-112,920	-57,434		170,354	-

Amounts for the previous year adapted to analytical criteria in force in 2014

APPENDIXII (cont.)

€000s						Profit
Financial year 2014	Gross Margin	Profit (loss)before tax	Average total assets	Financial year 2013	Gross Margin	(loss)before tax	Average total assets
TOTAL CATALONIA	86,538	5,078	5,291,960	TOTAL CATALONIA	67,375	-11,973	5,302,051
TOTAL BALEARICS-LEVANTE	108,665	-16,065	6,043,246	TOTAL BALEARICS-LEVANTE	79,398	-66,496	5,960,507
TOTAL NORTH	75,515	17,549	3,038,306	TOTAL NORTH	52,381	-9,294	3,061,473
TOTAL NAVA-ARAG-RIOJ-SORIA	63,675	20,296	2,419,242	TOTAL NAVA-ARAG-RIOJ-SORIA	44,862	-17,472	2,369,465
TOTAL CANARIES	25,572	-3,668	1,506,266	TOTAL CANARIES	19,494	-14,436	1,583,822
TOTAL NORTHWEST	54,247	1,984	2,903,337	TOTAL NORTHWEST	29,377	-50,589	2,996,395
TOTAL MADRID WEST	94,398	11,827	5,808,590	TOTAL MADRID WEST	61,529	-25,780	5,907,736
TOTAL MADRID EAST	53,076	-3,354	3,708,762	TOTAL MADRID EAST	28,218	-35,679	3,677,985
TOTAL MADRID CORPORATE BKG	130,466	93,339	4,832,505	TOTAL MADRID CORPORATE BKG	127,531	87,083	4,554,502
TOTAL CAST.MANCHA EXTREMAD	21,880	-8,876	1,331,586	TOTAL CAST.MANCHA EXTREMAD	15,939	-14,732	1,344,474
TOTAL ANDALUSIA	83,823	4,044	5,215,720	TOTAL ANDALUSIA	71,211	-29,222	5,277,760
TOTAL REMOTE NETWORKS	9,334	893	844,727	TOTAL REMOTE NETWORKS	7,917	132	881,407
NETWORK & DISTRIBUTION STAFF	-11,620	-19,330	7,358	NETWORK & DISTRIBUTION STAFF	-67	763	8,504
CONSUMER FINANCING	72,808	36,987	378,293	CONSUMER FINANCING	68,159	33,879	346,582
OTHER BUSINESSES	580,446	252,135		OTHER BUSINESSES	665,675	414,921	-
TOTAL	1,448,823	392,839	43,329,898	TOTAL	1,338,999	261,105	43,272,663

Amounts for the previous year adapted to analytical criteria in force in 2014

ANNEX III

Financial Statements of Bankinter, S.A. as at 31 December 2014 and 2013

CONSOLIDATED BALANCE SHEETS AS AT 31 December 2014 AND 2013 (€000s)

ASSETS	Note	31/12/2014	31/12/2013 (*)	LIABILITIES AND EQUITY	Note	31/12/2014	31/12/2013 (*)
CASH AND BALANCES AT CENTRAL BANKS	6	357,063		885,964 LIABILITIES:
FINANCIALASSETSHELDFORTRADING:	7	5,353,482		4,346,573 FINANCIALASSETSHELDFORTRADING:	7	2,438,260	1,747,482
Deposits with credit institutions		544,529		920,112 Deposits from credit institutions		270,620	-
Loans and advances to customers		1,967,180		979,439 Customer deposits		451,559	193,482
Debt instruments Equity instruments		2,345,496 59,320		1,736,671 Trading derivatives 66,662 Short positions in securities		319,368 1,396,713	248,297 1,305,703
Trading derivatives		436,957		643,689 Other financial liabilities		-	-
Memorandum items: Loaned or advanced as collateral		1,700,679		961,805 OTHER FINANCIAL LIABILITIES AT FAIR VALUE
				WITH CHANGES IN PROFIT AND LOSS:	7	-	-
OTHER FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS	7	49,473		18,158 Customer deposits		-	-
Equity instruments		49,473	18,158
Memorandum items: Loaned or advanced as collateral		-	-	FINANCIAL LIABILITIES AT AMORTISED COST	18	53,737,120	54,249,224
		-	-	Deposits from central banks		3,240,433	3,243,794
FINANCIAL ASSETS AVAILABLE FOR SALE:	8	5,693,680		Deposits from credit institutions 6,668,719 Customer deposits		5,237,576 33,364,263	4,617,009 37,485,413
Debt instruments		5,628,836		6,593,802 Marketable debt securities		9,877,631	6,960,905
Equity instruments		64,844		74,917 Subordinated liabilities		607,794	612,011
Memorandum items: Loaned or advanced as collateral		2,936,586		3,003,957 Other financial liabilities		1,409,423	1,330,092
LOANS AND RECEIVABLES:	10	44,249,937		42,811,055 MACRO-HEDGING ADJUSTMENTS TO FINANCIAL LIABILITIES		-	-
Deposits with credit institutions		806,596	1,095,060
Loans and advances to customers		42,951,791		41,580,673 HEDGING DERIVATIVES	11	20,240	25,608
Debt instruments		491,550	135,322
Memorandum items: Loaned or advanced as collateral		356,515		365,847 LIABILITIES LINKED TO NON-CURRENT ASSETS HELD FOR SALE		-	-
HELD TO MATURITY INVESTMENTS	9	2,819,482		3,220,721 LIABILITIES UNDER INSURANCE CONTRACTS		-	-
Memorandum items: Loaned or advanced as collateral		2,805,745		2,886,655 PROVISIONS: Pension funds and similar obligations	19	84,796 756	45,353 1,391
ADJUSTMENTS TO FINANCIAL ASSETS BY MACRO
HEDGING	11	-	-	Allowances for taxes and other legal contingencies		69,738	33,206
				Provisions for contingent risks and commitments		7,498	8,643
HEDGING DERIVATIVES	11	148,213		84,481 Other provisions		6,804	2,113
NON-CURRENT ASSETS HELD FOR SALE	12	33,610		35,158 TAX LIABILITIES	16	225,964	138,435
				Current		136,935	65,316
INVESTMENTS	13	555,370		582,393 Deferred		89,029	73,119
Associates Jointly controlled entities		7,777 202	7,777	162 OTHER LIABILITIES	17	170,295	129,073
Group Companies		547,391	574,454
				TOTAL LIABILITIES		56,676,675	56,335,175
PENSION-LINKED INSURANCE AGREEMENTS		714	1,327	EQUITY:
REINSURANCE ASSETS		-	-
				EQUITY:	21	3,262,022	2,940,091
TANGIBLE ASSETS:	14	342,300		353,785 Capital-		269,660	268,675
Property, plant and equipment For internal use		342,300 317,643		353,785 Registered 326,831 Less- uncalled capital		269,660 -	268,675 -
Assigned on lease		24,657		26,954 Issue premium		1,184,268	1,172,645
Real estate investments		-	-	Reserves		1,483,948	1,330,814
Memorandum item: acquired under finance lease		-	-	Other equity instruments		-	12,608
				Of compound financial instruments
INTANGIBLE ASSETS:	15	-	-	Other equity instruments		-	12,608
Goodwill Other intangible assets		- -	- -	Less - Treasury shares Profit (loss) for the year		(771) 393,830	(432) 208,383
				Less - Dividends and remunerations		(68,913)	(52,602)
TAX ASSETS:	16	384,982	280,124
Current Deferred		195,463 189,519		136,570 VALUATION ADJUSTMENTS: 143,554 Financial assets available for sale	20	73,153 71,771	27,033 26,832
				Exchange differences		220	201
OTHER ASSETS	17	23,544	13,841	Other valuation adjustments		1,162
TOTAL ASSETS MEMORANDUMITEMS		60,011,850	59,302,299	TOTAL LIABILITIES AND EQUITY		60,011,850	59,302,299
CONTINGENT RISKS	23	3,833,523	7,596,154
CONTINGENT COMMITMENTS		12,066,675	12,466,008

INCOMESTATEMENT FORTHE YEARS ENDED 31 December 2014 AND 2013 (€000s)

		(Debit)	Credit
	Note	2014	2013 (*)
INTEREST AND SIMILAR INCOME	28	1,314,511	1,418,716
INTEREST EXPENSE AND SIMILAR CHARGES	28	(681,762)	(910,835)
NET INTEREST INCOME		632,749	507,881
INCOME FROM EQUITY INSTRUMENTS		301,166	133,535
FEES AND COMMISSIONS INCOME	27	319,158	279,259
FEES AND COMMISSIONS EXPENSE	27	(84,231)	(66,816)
GAINS / LOSSES ON FINANCIAL ASSETS AND LIABILITIES:	29	70,767	199,551
Held for trading		22,963	44,788
Other financial assets at fair value through profit and loss		1,163	8,228
Financial instruments not measured at fair value through profit and loss		46,798	147,169
Other		(157)	(634)
EXCHANGE DIFFERENCES (net)	30	43,274	42,014
OTHER OPERATING INCOME:	32	28,299	24,256
Other operating income		28,299	24,256
OTHER OPERATING EXPENSES:	32	(74,310)	(93,115)
Other operating expenses		(74,310)	(93,115)
GROSS INCOME		1,236,872	1,026,565
ADMINISTRATIVE COSTS:		(445,647)	(431,946)
Personnel expenses	26	(232,709)	(230,774)
Other general administrative expenses	31	(212,938)	(201,172)
DEPRECIATION AND AMORTISATION	14	(27,196)	(26,949)
PROVISIONS (NET)	19	(42,813)	(14,308)
IMPAIRMENT LOSSES ON FINANCIAL ASSETS (NET):		(265,675)	(296,977)
Loans and receivables	10	(262,077)	(293,883)
Other financial instruments not measured at fair value through profit and loss	8	(3,598)	(3,094)
PROFIT FROM OPERATIONS		455,541	256,385
IMPAIRMENT LOSSES ON OTHER ASSETS (net):		(2,336)	(1,920)
Goodwill and other intangible assets		-	-
Other assets		(2,336)	(1,920)
GAINS / (LOSSES) ON DERECOGNITION OF ASSETS NOT CLASSIFIED AS	33	5,127	6,855
NON-CURRENT ASSETS HELD FOR SALE
GAINS / LOSSES ON NON-CURRENT ASSETS HELD FOR SALE NOT CLASSIFIED AS DISCONTINUED OPERATIONS	33	(4,775)	(5,790)
PROFIT BEFORE TAX		453,557	255,530
INCOME TAX	41	(59,727)	(47,147)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS		393,830	208,383
PROFIT (LOSS) FROM DISCONTINUED OPERATIONS (net)		-	-
RESULT FOR THE FINANCIAL YEAR		393,830	208,383
EARNINGS PER SHARE:		0.44	0.27
Basic earnings (euros)		0.44	0.26
Diluted earnings (euros)

COMPREHENSIVESTATEMENTS OF INCOME FORTHE YEARS ENDED 31 December 2014 AND 2013(€000s)

	Financial year	Financial year
	2014	2013 (*)
RESULT FOR THE FINANCIAL YEAR	393,830	208,383
OTHER COMPREHENSIVE INCOME	46,120	6,447
Items that will not be reclassified to profit and loss;	1,162	-
Actuarial gains and losses on defined benefit plans	1,659	-
Non-current assets held for sale	-	-
Entities valued under the equity method	-	-
Income tax relating to items that will not be reclassified to profit and loss	(498)	-
Items that may be reclassified to profit and loss;	44,958	6,447
Financial assets available for sale	64,199	9,221
Gains (losses) on valuation	105,654	112,596
Amounts transferred to profit and loss	(41,455)	(103,375)
Other reclassifications	-	-
Cash flow hedging	-	-
Gains (losses) on valuation	-	-
Amounts transferred to profit and loss	-	-
Amounts transferred to the initial value of hedged items	-	-
Other reclassifications	-	-
Hedging of net investments in foreign operations	-	-
Gains (losses) on valuation	-	-
Amounts transferred to profit and loss	-	-
Other reclassifications	-	-
Exchange differences	27	(11)
Gains (losses) on valuation	27	(11)
Amounts transferred to profit and loss	-	-
Other reclassifications	-	-
Non-current assets for sale	-	-
Gains (losses) on valuation	-	-
Amounts transferred to profit and loss	-	-
Other reclassifications	-	-
Actuarial gains (losses) on pension plans	-	-
Statement of comprehensive income	-	-
Income tax	(19,268)	(2,763)
TOTAL COMPREHENSIVE INCOME	439,950	214,830

COMPREHENSIVESTATEMENTSOFCHANGESINEQUITY FORTHEYEARS ENDED31 December 2014 AND2013(€000s)

					Equity
	Capital	Issue	premium Reserves	Other equity instruments	Less - Treasury shares	Profit (loss) for the year	Less - Dividends and remunerations	Total Equity	Valuation adjustments	Total
CLOSING BALANCE AT 31 December 2013		268,675 1,172,645 1,356,638		12,608	(432)	233,907		(52,602) 2,991,439	27,033	3,018,472
Adjustments due to changes in accounting criteria			(25,824)			(25,524)		(51,348)		(51,348)
Adjustments due to errors
ADJUSTED OPENING BALANCE		268,675 1,172,645 1,330,814		12,608	(432)	208,383		(52,602) 2,940,091	27,033	2,967,124
Total comprehensive income	-	-	-	-	-	393,830	-	393,830	46,120	439,950
Other changes in equity:	985	11,623	153,134	(12,608)		(339) (208,383)	(16,311)	(71,899)	-	(71,899)
Capital increases	985	11,623	-	(12,608)	-	-	-	-	-	-
Capital reductions	-	-	-	-	-	-	-	-	-	-
Conversion of financial liabilities into capital	-	-	-	-	-	-	-	-	-	-
Increases in other equity instruments	-	-	-	-	-	-	-	-	-	-
Reclassification of financial liabilities to other equity instruments	-	-	-	-	-	-	-	-	-	-
Reclassification of other equity instruments to financial liabilities	-	-	-	-	-	-	-	-	-	-
Distribution of dividends / Shareholder remuneration	-	-	-	-	-	-	(70,167)	(70,167)	-	(70,167)
Transactions with own equity instruments (net)	-	-	24	-	(339)	-	-	(315)	-	(315)
Transfer between net worth entries	-	-	154,527	-	-	(208,383)	53,856	-	-	-
Increases (reductions) due to business combinations	-	-	-	-	-	-	-	-	-	-
Payments with equity instruments	-	-	(205)	-	-	-	-	(205)	-	(205)
Other increases (reductions) in equity	-	-	(1,212)	-	-	-	-	(1,212)	-	(1,212)
CLOSING BALANCE AT 31 December 2014		269,660 1,184,268 1,483,948		-	(771)	393,830		(68,913) 3,262,022	73,153	3,335,175

				Equity
	Capital	Issue	premium Reserves	Other equity instruments	Less - Treasury shares	Profit (loss) for the year	Less - Dividends and remunerations	Total Equity	Valuation adjustments	Total
CLOSING BALANCE AT 31 December 2012	169,142		1,118,186 1,379,410	72,633	(225)	148,208	(46,125)	2,841,229	20,586	2,861,815
Adjustments due to changes in accounting criteria			(24,956)			(868)		(25,824)		(25,824)
Adjustments due to errors
ADJUSTED OPENING BALANCE	169,142		1,118,186 1,354,454	72,633	(225)	147,340	(46,125)	2,815,405	20,586	2,835,991
Total comprehensive income	-	-	-	-	-	208,383	-	208,383	6,447	214,830
Other changes in equity:	99,533	54,459	(23,640)	(60,025)	(207)	(147,340)	(6,477)	(83,697)	-	(83,697)
Capital increases	99,533	54,459	(93,967)	(60,025)	-	-	-	-	-	-
Capital reductions	-	-	-	-	-	-	-	-	-	-
Conversion of financial liabilities into capital	-	-	-	-	-	-	-	-	-	-
Increases in other equity instruments	-	-	-	-	-	-	-	-	-	-
Reclassification of financial liabilities to other equity instruments	-	-	-	-	-	-	-	-	-	-
Reclassification of other equity instruments to financial liabilities	-	-	-	-	-	-	-	-	-	-
Distribution of dividends / Shareholder remuneration	-	-	-	-	-	-	(67,977)	(67,977)	-	(67,977)
Transactions with own equity instruments (net)	-	-	245	-	(207)	-	-	38	-	38
Transfer between net worth entries	-	-	85,840	-	-	(147,340)	61,500	-	-	-
Increases (reductions) due to business combinations	-	-	-	-	-	-	-	-	-	-
Payments with equity instruments	-	-	(16,970)	-	-	-	-	(16,970)	-	(16,970)
Other increases (reductions) in equity	-	-	1,212	-	-	-	-	1,212	-	1,212
CLOSING BALANCE AT 31 December 2013	268,675		1,172,645 1,330,814	12,608	(432)	208,383	(52,602)	2,940,091	27,033	2,967,124

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED 31 DECEMBER 2014 AND 2013(€000s)

	Financial year	Financial year 2013
	2014	(*)
NET CASH FLOWS FROM OPERATIONS	(768,090)	715,870
Profit (loss) for the year	393,830	208,383
Adjustments to obtain cash flow from operating activities	405,653	422,435
Other adjustments	378,457	395,486
Depreciation and Amortisation	27,196	26,949
Net increase/decrease in operating assets	1,813,226	(2,441,388)
Held for trading	1,006,909	2,237,308
Other financial assets at fair value through profit or loss	31,315	(21,703)
Financial assets available for sale	(1,035,638)	(2,814,477)
Loans and receivables	1,652,362	(1,786,982)
Other operating assets	158,278	(55,535)
Net increase/decrease in operating liabilities	140,673	(2,405,843)
Held for trading	690,779	(44,472)
Other financial assets at fair value through profit or loss	-	-
Financial liabilities at amortised cost	(669,313)	(2,350,707)
Other operating liabilities	119,207	(10,664)
Corporation tax collections/payments	104,979	49,507
NET CASH FLOWS FROM INVESTING ACTIVITIES:	397,229	(500,818)
Payments	(82,269)	(529,364)
Tangible assets	(34,442)	(14,676)
Intangible assets	(8,062)	(8,062)
Investments	(39,765)	(39,222)
Non-current assets held for sale and associated liabilities	-	-
Held to maturity investments	-	(467,405)
Collections	479,498	28,546
Tangible assets	18,731	342
Intangible assets	-	-
Investments	37,912	12,000
Subsidiaries and other business units
Non-current assets held for sale	23,109	16,204
Held to maturity investments	399,746	-
NET CASH FLOWS FROM FINANCING ACTIVITIES	(90,375)	(63,461)
Payments	(97,928)	(65,628)
Dividends	(90,077)	(63,441)
Subordinated liabilities	-	-
Amortisation of equity instruments	-	-
Acquisition of own shares (capital contributions) (other than savings banks)	(7,851)	(2,186)
Other payments linked to financing activities	-	-
Collections	7,553	2,166
Subordinated liabilities	-	-
Issuance of equity instruments	-	-
Disposal of own shares/capital contributions (other than savings banks)	7,553	2,166
Other inflows linked to financing activities	-	-
EFFECT OF EXCHANGE-RATE VARIATIONS	-	-
EFFECT OF CHANGES INCASH ANDCASH EQUIVALENTS	(461,236)	151,591
CASH AND CASHEQUIVALENTS AT START OF PERIOD	1,041,021	889,430
CASH AND CASH EQUIVALENTS AT END OF PERIOD	579,785	1,041,021
MEMORANDUM ITEMS:
BREAKDOWN OF CASH AND CASHEQUIVALENTS
	139,508	118,902
Cash
Balances equivalent to cash at central banks	217,555	767,062
Other financial assets	222,722	155,057
Total cash and cash equivalents at end of period	579,785	1,041,021

APPENDIX IV Individualised information on certain issues, buybacks or

reimbursements of debt securities

			Credit					Amount of the Issue,	Outstanding			Type of	Risks that the Group would
Name	Relationship with	Country	rating of	ISIN code	Type of	Type of	Date of	Buy-back or	balance as at	Interest	Market on	Guarantee	assume in	Maturity date
	the Group		Issuer or Issue		Security	Transaction	transaction	Reimbursement	30-12-2014 (€000s)	Rate	which traded	Granted	addition to the	of issue
								(€000s)			AIAF secondary		guarantee Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136790B8	Structured bonds	Issue	07/02/2014	5,000	5,000	(*)	fixed-income	-	Enhancement	18/02/2019
						Depreciation					market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling	SPAIN	-	ES02136790C6	Structured	and	28/02/2014	5,000	-	(*)	fixed-income	-	Enhancement	-
	Company (**)				bonds	Amortisation					market		(0%)
Bankinter S.A.	Controlling	SPAIN	-	ES02136790F9	Structured	Issue	17/02/2014	1,000	1,000	(*)	AIAF secondary fixed-income	-	Credit Enhancement	26/02/2019
	Company (**)				bonds						market		(0%)
	Controlling				Structured						AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790G7	bonds	Issue	21/02/2014	5,000	5,000	(*)	fixed-income market	-	Enhancement (0%)	04/03/2019
	Controlling				Structured						AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790H5	bonds	Issue	19/02/2014	1,200	1,200	(*)	fixed-income	-	Enhancement	04/03/2019
						Depreciation					market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136790I3	Structured bonds	and	21/02/2014	1,700	-	(*)	fixed-income	-	Enhancement	-
						Amortisation Depreciation					market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling	SPAIN	-	ES02136790J1	Structured	and	18/02/2014	1,000	-	(*)	fixed-income	-	Enhancement	-
	Company (**)				bonds	Amortisation					market		(0%)
Bankinter S.A.	Controlling	SPAIN	-	ES02136790K9	Structured	Issue	27/02/2014	5,000	5,000	(*)	AIAF secondary fixed-income	-	Credit Enhancement	11/03/2019
	Company (**)				bonds						market		(0%)
	Controlling				Structured	Depreciation					AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790M5	bonds	and Amortisation	14/03/2014	5,000	-	(*)	fixed-income market	-	Enhancement (0%)	-
	Controlling				Structured						AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790O1	bonds	Issue	20/03/2014	36,125	36,125	(*)	fixed-income	-	Enhancement	27/03/2019
											market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136790P8	Structured bonds	Issue	14/03/2014	5,000	5,000	(*)	fixed-income	-	Enhancement	25/03/2019
						Depreciation					market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling	SPAIN	-	ES02136790Q6	Structured	and	04/03/2014	1,150	-	(*)	fixed-income	-	Enhancement	-
	Company (**)				bonds	Amortisation					market		(0%)
Bankinter S.A.	Controlling	SPAIN	-	ES02136790R4	Structured	Depreciation and	07/03/2014	2,000	-	(*)	AIAF secondary fixed-income	-	Credit Enhancement	-
	Company (**)				bonds	Amortisation					market		(0%)
	Controlling				Structured	Depreciation					AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790S2	bonds	and Amortisation	21/03/2014	14,125	-	(*)	fixed-income market	-	Enhancement (0%)	-
	Controlling				Structured	Depreciation					AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790T0	bonds	and	28/03/2014	4,950	-	(*)	fixed-income	-	Enhancement	-
						Amortisation					market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136790U8	Structured bonds	Issue	19/03/2014	1,000	1,000	(*)	fixed-income	-	Enhancement	20/03/2019
											market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136790V6	Structured bonds	Issue	19/03/2014	1,000	1,000	(*)	fixed-income	-	Enhancement	26/03/2019
											market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling	SPAIN	-	ES02136790W4	Structured	Issue	28/03/2014	4,950	4,950	(*)	fixed-income	-	Enhancement	08/04/2019
	Company (**)				bonds						market		(0%)
Bankinter S.A.	Controlling	SPAIN	-	ES02136790X2	Structured	Depreciation and	24/03/2014	1,000	-	(*)	AIAF secondary fixed-income	-	Credit Enhancement	-
	Company (**)				bonds	Amortisation					market		(0%)
	Controlling				Structured	Depreciation					AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790Y0	bonds	and Amortisation	27/03/2014	1,600	-	(*)	fixed-income market	-	Enhancement (0%)	-
	Controlling				Structured						AIAF secondary		Credit
Bankinter S.A.	Company (**)	SPAIN	-	ES02136790Z7	bonds	Issue	28/03/2014	1,000	1,000	(*)	fixed-income	-	Enhancement	04/04/2019
											market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791A8	Structured bonds	Issue	11/04/2014	3,600	3,600	(*)	fixed-income	-	Enhancement	18/04/2019
											market AIAF secondary		(0%) Credit
Bankinter S.A.	Controlling	SPAIN	-	ES02136791B6	Structured	Issue	11/04/2014	8,000	8,000	(*)	fixed-income	-	Enhancement	18/04/2019
	Company (**)				bonds						market		(0%)

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791C4	Structured bonds	Issue	16/04/2014	48,075	48,075	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/04/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791D2	Structured bonds	Issue	03/04/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/04/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791E0	Structured bonds	Issue	11/04/2014	3,850	3,850	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/04/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791F7	Structured bonds	Partial amortisation	09/04/2014	3,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/04/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791G5	Structured bonds	Depreciation and Amortisation	14/04/2014	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791H3	Structured bonds	Issue	09/05/2014	18,700	18,700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	16/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791I1	Structured bonds	Issue	09/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	16/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791J9	Structured bonds	Issue	06/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791K7	Structured bonds	Issue	16/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791L5	Structured bonds	Issue	23/05/2014	39,175	39,175	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791M3	Structured bonds	Issue	08/05/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791N1	Structured bonds	Issue	09/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	20/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791O9	Structured bonds	Issue	23/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791P6	Structured bonds	Depreciation and Amortisation	30/05/2014	25,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791Q4	Structured bonds	Depreciation and Amortisation	30/05/2014	4,950	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791R2	Structured bonds	Issue	16/05/2014	3,400	3,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791S0	Structured bonds	Issue	26/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791T8	Structured bonds	Depreciation and Amortisation	15/05/2014	1,200	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791U6	Structured bonds	Issue	15/05/2014	2,200	2,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791V4	Structured bonds	Issue	30/05/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	10/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791W2	Structured bonds	Issue	06/06/2014	12,675	12,675	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791X0	Structured bonds	Issue	23/05/2014	1,700	1,700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	30/05/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791Y8	Structured bonds	Issue	13/06/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136791Z5	Structured bonds	Issue	13/06/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/06/2019

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES0213679220	Structured bonds	Partial amortisation	05/04/2013	(€000s) 3,840	960	(*)	AIAF secondary fixed-income	-	guarantee Credit Enhancement	04/04/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679246	Structured bonds	Depreciation and Amortisation	22/02/2013	10,250	-	(*)	market AIAF secondary fixed-income market	-	(0%) Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679253	Structured bonds	Depreciation and Amortisation	22/02/2013	2,900	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679261	Structured bonds	Depreciation and Amortisation	08/03/2013	8,400	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679279	Structured bonds	Depreciation and Amortisation	02/04/2013	9,800	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679287	Structured bonds	Depreciation and Amortisation	05/04/2013	2,700	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679295	Structured bonds	Depreciation and Amortisation	19/04/2013	9,150	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792A6	Structured bonds	Issue	30/05/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792B4	Structured bonds	Issue	27/06/2014	28,125	28,125	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/07/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792C2	Structured bonds	Issue	20/06/2014	10,000	10,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792D0	Structured bonds	Issue	20/06/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/06/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792E8	Structured bonds	Depreciation and Amortisation	06/06/2014	4,900	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES02136792F5	Structured bonds	Issue	30/05/2014	1,400	1,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/06/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792G3	Structured bonds	Depreciation and Amortisation	13/06/2014	3,900	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES02136792H1	Structured bonds	Issue	13/06/2014	4,000	4,000	(*)	AIAF secondary fixed-income market AIAF secondary	-	Credit Enhancement (0%) Credit	20/06/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792I9	Structured bonds	Issue Depreciation	30/06/2014	13,450	13,450	(*)	fixed-income market AIAF secondary	-	Enhancement (0%) Credit	09/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792J7	Structured bonds	and Amortisation	20/06/2014	1,200	-	(*)	fixed-income market AIAF secondary	-	Enhancement (0%) Credit	-
Bankinter S.A.	Parent company	SPAIN	-	ES02136792K5	Structured bonds	Issue	24/06/2014	4,950	4,950	(*)	fixed-income market AIAF secondary	-	Enhancement (0%) Credit	03/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792L3	Structured bonds	Issue	16/06/2014	1,500	1,500	(*)	fixed-income market	-	Enhancement (0%)	25/06/2019
Bankinter S.A.	Parent company	SPAIN	-	ES0313679716	Structured bonds in foreign currency	Issue	04/11/2011	74	74	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/11/2016
Bankinter S.A.	Parent company	SPAIN	-	ES02136792P4	Structured bonds	Issue	27/06/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792R0	Structured bonds	Issue	27/06/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/07/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679303	Structured bonds	Depreciation and Amortisation	12/04/2013	1,450	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/04/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679311	Structured bonds	Depreciation and Amortisation	30/04/2013	5,050	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/05/2018

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679329	Structured bonds	Depreciation and Amortisation	13/05/2013	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/05/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679337	Structured bonds	Depreciation and Amortisation	31/05/2013	16,321	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/06/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679345	Structured bonds	Depreciation and Amortisation	24/05/2013	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/06/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679360	Structured bonds	Depreciation and Amortisation	13/06/2013	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	25/06/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679378	Structured bonds	Depreciation and Amortisation	21/06/2013	16,504	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	02/07/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679386	Structured bonds	Depreciation and Amortisation	19/06/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0213679469	Structured bonds	Depreciation and Amortisation	31/03/2014	4,500	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0213679501	Structured bonds	Depreciation and Amortisation	25/02/2014	200	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679881	Structured bonds	Issue	03/01/2014	47,100	47,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/01/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679931	Structured bonds	Issue	07/01/2014	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	16/01/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679956	Structured bonds	Issue	17/01/2014	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/01/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679972	Structured bonds	Issue	14/02/2014	71,275	71,275	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	20/02/2019
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0213679980	Structured bonds	Depreciation and Amortisation	07/02/2014	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES03136790B6	Structured bonds	Depreciation and Amortisation	11/02/2013	1,450	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES03136790E0	Structured bonds	Depreciation and Amortisation	30/05/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES03136790F7	Structured bonds	Depreciation and Amortisation	30/05/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790J9	Structured bonds	Depreciation and Amortisation	16/01/2013	2,600	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790K7	Structured bonds	Depreciation and Amortisation	06/02/2013	9,750	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790L5	Structured bonds	Depreciation and Amortisation	01/03/2013	7,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790M3	Structured bonds	Depreciation and Amortisation	08/03/2013	4,600	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790N1	Structured bonds	Depreciation and Amortisation	14/03/2013	1,350	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790O9	Structured bonds	Depreciation and Amortisation	22/03/2013	8,750	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES03136790O9	Structured bonds	Depreciation and Amortisation	22/06/2013	8,750	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790P6	Structured bonds	Depreciation and Amortisation	12/04/2013	2,850	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790Q4	Structured bonds	Depreciation and Amortisation	12/04/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790R2	Structured bonds	Depreciation and Amortisation	19/04/2013	5,700	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790S0	Structured bonds	Depreciation and Amortisation	22/04/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790T8	Structured bonds	Depreciation and Amortisation	10/05/2013	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790U6	Structured bonds	Depreciation and Amortisation	14/05/2013	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679641	Structured bonds in foreign currency	Issue	05/08/2011	439	439	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/08/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790W2	Structured bonds	Depreciation and Amortisation	28/05/2013	1,100	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790X0	Structured bonds	Depreciation and Amortisation	14/06/2013	5,645	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790Y8	Structured bonds	Depreciation and Amortisation	14/06/2013	3,450	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136791X8	Structured bonds	Issue	07/01/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/07/2015
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136791Y6	Structured bonds	Issue	17/01/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/01/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136791Z3	Structured bonds	Depreciation and Amortisation	24/01/2014	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792A4	Structured bonds	Depreciation and Amortisation	31/01/2014	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792B2	Structured bonds	Issue	31/01/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/02/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792C0	Structured bonds	Issue	23/01/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/01/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792E6	Structured bonds	Issue	14/02/2014	1,400	1,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/02/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792F3	Structured bonds	Issue	17/02/2014	2,600	2,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/02/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792G1	Structured bonds	Depreciation and Amortisation	21/02/2014	1,200	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792I7	Structured bonds	Issue	26/02/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	26/02/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792J5	Structured bonds	Depreciation and Amortisation	10/03/2014	2,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792K3	Structured bonds	Issue	21/03/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/03/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792L1	Structured bonds	Issue	24/03/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/03/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793P0	Structured bonds in foreign currency	Issue	01/08/2014	824	824	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/08/2016

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792N7	Structured bonds in foreign currency	Depreciation and Amortisation	25/03/2014	679,516	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792O5	Structured bonds	Issue	16/04/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/04/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792P2	Structured bonds	Issue	16/04/2014	2,300	2,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/04/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792Q0	Structured bonds	Depreciation and Amortisation	25/04/2014	2,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792R8	Structured bonds	Issue	30/04/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/05/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792S6	Structured bonds	Issue	12/05/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/05/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792T4	Structured bonds	Depreciation and Amortisation	16/05/2014	1,400	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792U2	Structured bonds	Depreciation and Amortisation	16/05/2014	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792V0	Structured bonds	Issue	19/05/2014	2,900	2,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	01/06/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792W8	Structured bonds	Depreciation and Amortisation	19/05/2014	1,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792X6	Structured bonds	Issue	21/05/2014	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/05/2018
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792Y4	Structured bonds	Issue	26/05/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	26/05/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792Z1	Structured bonds	Issue	27/05/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/06/2017
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES0313679352	Structured bonds	Depreciation and Amortisation	27/05/2013	5,000	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136793A2	Structured bonds	Issue	13/06/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/06/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136793C8	Structured bonds	Issue	16/06/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/06/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793D6	Structured bonds	Depreciation and Amortisation	20/06/2014	500	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES03136793E4	Structured bonds	Issue	16/06/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/06/2017
Bankinter S.A.	Parent company	SPAIN	-	ES0313679500	Structured bonds	Depreciation and Amortisation	24/06/2013	300	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679740	Structured bonds	Depreciation and Amortisation	27/01/2013	3,960	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679757	Structured bonds	Partial amortisation	07/01/2013	3,375	375	(*)	AIAF secondary fixed-income market	-	(0%) Credit Enhancement (0%)	05/01/2015
Bankinter S.A.	Parent company	SPAIN	-	ES0313679773	Structured bonds	Depreciation and Amortisation	28/01/2013	9,050	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679781	Structured bonds	Partial amortisation	08/02/2013	6,162	1,088	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/02/2017
Bankinter S.A.	Parent company	SPAIN	-	ES0313679799	Structured bonds	Depreciation and Amortisation	25/02/2013	3,850	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES0313679831	Structured bonds	Depreciation and Amortisation	11/03/2013	2,120	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679856	Structured bonds	Partial amortisation	24/04/2013	2,200	550	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/04/2017
Bankinter S.A.	Parent company	SPAIN	-	ES0313679898	Structured bonds	Depreciation and Amortisation	03/02/2013	2,205	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679898	Structured bonds	Depreciation and Amortisation	03/06/2013	245	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES0313679989	Structured bonds	Depreciation and Amortisation	07/01/2013	4,100	-	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	-
Bankinter S.A.	Parent company	SPAIN	-	ES02136792M1	Structured bonds	Issue	04/07/2014	12,000	12,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792Q2	Structured bonds	Issue	04/07/2014	2,100	2,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792S8	Structured bonds	Issue	16/07/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792T6	Structured bonds	Issue	16/07/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792U4	Structured bonds	Issue	04/07/2014	3,200	3,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792V2	Structured bonds	Issue	04/07/2014	3,200	3,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	16/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792W0	Structured bonds	Issue	25/07/2014	18,075	18,075	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792X8	Structured bonds	Issue	14/07/2014	7,375	7,375	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792Y6	Structured bonds	Issue	16/07/2014	1,400	1,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792Z3	Structured bonds	Issue	24/07/2014	28,425	28,425	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793A4	Structured bonds	Issue	01/08/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793B2	Structured bonds	Issue	01/08/2014	10,825	10,825	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793C0	Structured bonds	Issue	18/07/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	25/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793D8	Structured bonds	Issue	18/07/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	25/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793E6	Structured bonds	Issue	18/07/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793F3	Structured bonds	Issue	09/07/2014	2,300	2,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793G1	Structured bonds	Issue	16/07/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793H9	Structured bonds	Issue	21/07/2014	1,600	1,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/07/2019

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES02136793I7	Structured bonds	Issue	01/08/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793J5	Structured bonds	Issue	22/07/2014	3,100	3,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/07/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793K3	Structured bonds	Issue	22/08/2014	18,325	18,325	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	02/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793L1	Structured bonds	Issue	22/08/2014	20,525	20,525	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	02/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793M9	Structured bonds	Issue	06/08/2014	4,300	4,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	13/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793N7	Structured bonds	Issue	18/08/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793P2	Structured bonds	Issue	28/08/2014	8,200	8,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793Q0	Structured bonds	Issue	08/08/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793S6	Structured bonds	Issue	29/08/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793T4	Structured bonds	Issue	29/08/2014	1,850	1,850	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793U2	Structured bonds	Issue	29/08/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793V0	Structured bonds	Issue	12/09/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793W8	Structured bonds	Issue	12/09/2014	13,600	13,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793X6	Structured bonds	Issue	12/09/2014	13,475	13,475	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793Y4	Structured bonds	Issue	19/09/2014	1,950	1,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	26/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136793Z1	Structured bonds	Issue	26/09/2014	3,100	3,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794A2	Structured bonds	Issue	19/09/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	26/09/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794B0	Structured bonds	Issue	03/10/2014	21,100	21,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	10/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794C8	Structured bonds	Issue	29/09/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794D6	Structured bonds	Issue	03/10/2014	10,400	10,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794E4	Structured bonds	Issue	26/09/2014	7,500	7,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794F1	Structured bonds	Issue	06/10/2014	23,275	23,275	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794G9	Structured bonds	Issue	29/09/2014	4,000	4,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/10/2019

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES02136794H7	Structured bonds	Issue	03/10/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794I5	Structured bonds	Issue	10/10/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794J3	Structured bonds	Issue	26/09/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794K1	Structured bonds	Issue	03/10/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	10/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794L9	Structured bonds	Issue	10/10/2014	1,300	1,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794M7	Structured bonds	Issue	08/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794N5	Structured bonds	Issue	17/10/2014	4,900	4,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794O3	Structured bonds	Issue	24/10/2014	9,950	9,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	31/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794P0	Structured bonds	Issue	24/10/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	31/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794Q8	Structured bonds	Issue	10/10/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794R6	Structured bonds	Issue	24/10/2014	21,775	21,775	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794S4	Structured bonds	Issue	10/10/2014	2,600	2,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794T2	Structured bonds	Issue	14/10/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794U0	Structured bonds	Issue	28/10/2014	10,325	10,325	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794V8	Structured bonds	Issue	17/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/10/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794W6	Structured bonds	Issue	23/10/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794X4	Structured bonds	Issue	22/10/2014	3,100	3,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794Y2	Structured bonds	Issue	03/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136794Z9	Structured bonds	Issue	31/10/2014	900	900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795A9	Structured bonds	Issue	31/10/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795B7	Structured bonds	Issue	11/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795C5	Structured bonds	Issue	17/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	25/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795D3	Structured bonds	Issue	21/11/2014	33,850	33,850	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	02/12/2019

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES02136795E1	Structured bonds	Issue	03/11/2014	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795F8	Structured bonds	Issue	03/11/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795G6	Structured bonds	Issue	03/11/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	11/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795H4	Structured bonds	Issue	05/11/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795I2	Structured bonds	Issue	17/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	25/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795J0	Structured bonds	Issue	14/11/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	21/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795K8	Structured bonds	Issue	25/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	02/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795L6	Structured bonds	Issue	26/11/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795M4	Structured bonds	Issue	21/11/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795N2	Structured bonds	Issue	21/11/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/11/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795O0	Structured bonds	Issue	05/12/2014	8,425	8,425	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795P7	Structured bonds	Issue	05/12/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795Q5	Structured bonds	Issue	28/11/2014	3,300	3,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795R3	Structured bonds	Issue	12/12/2014	30,125	30,125	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795S1	Structured bonds	Issue	12/12/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795T9	Structured bonds	Issue	01/12/2014	3,000	3,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795U7	Structured bonds	Issue	05/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795V5	Structured bonds	Issue	28/11/2014	2,900	2,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795W3	Structured bonds	Issue	12/12/2014	5,350	5,350	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795X1	Structured bonds	Issue	19/12/2014	21,950	21,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	30/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136795Y9	Structured bonds	Issue	30/12/2014	5,875	5,875	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136795Z6	Structured bonds	Issue	19/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES0213679634	Structured bonds	Issue	16/10/2013	500	500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/10/2018

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES02136796A7	Structured bonds	Issue	30/12/2014	(€000s) 4,950	4,950	(*)	AIAF secondary fixed-income market	-	guarantee Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796B5	Structured bonds	Issue	30/12/2014	4,850	4,850	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796C3	Structured bonds	Issue	19/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/12/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136796D1	Structured bonds	Issue	29/12/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796E9	Structured bonds	Issue	30/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796F6	Structured bonds	Issue	30/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796G4	Structured bonds	Issue	30/12/2014	1,900	1,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796J8	Structured bonds	Issue	30/12/2014	1,150	1,150	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES02136796K6	Structured bonds	Issue	30/12/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/01/2020
Bankinter S.A.	Parent company	SPAIN	-	ES0213679865	Structured bonds	Issue	13/12/2013	500	500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/12/2018
Bankinter S.A.	Parent company	SPAIN	-	ES0213679915	Structured bonds	Issue	27/12/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/01/2019
Bankinter S.A.	Parent company	SPAIN	-	ES03136791L3	Structured bonds	Issue	31/10/2013	3,000	3,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/05/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136791O7	Structured bonds	Issue	15/11/2013	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	22/11/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136791Q2	Structured bonds	Issue	12/11/2013	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/11/2018
Bankinter S.A.	Parent company	SPAIN	-	ES03136791R0	Structured bonds	Issue	22/11/2013	1,700	1,700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/11/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136791V2	Structured bonds	Issue	20/12/2013	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/12/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793F1	Structured bonds	Issue	04/07/2014	500	500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	13/07/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136793G9	Structured bonds	Issue	11/07/2014	800	800	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/07/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793H7	Structured bonds	Issue	21/07/2014	3,100	3,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/07/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793I5	Structured bonds	Issue	21/07/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	28/07/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793J3	Structured bonds	Issue	17/07/2014	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/07/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793L9	Structured bonds	Issue	28/07/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/08/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793N5	Structured bonds	Issue	23/07/2014	3,000	3,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	23/12/2015

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES03136793O3	Structured bonds	Issue	01/08/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/08/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793Q8	Structured bonds	Issue	22/08/2014	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/08/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793R6	Structured bonds	Issue	29/08/2014	2,200	2,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/09/2018
Bankinter S.A.	Parent company	SPAIN	-	ES03136793S4	Structured bonds	Issue	29/08/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	05/09/2018
Bankinter S.A.	Parent company	SPAIN	-	ES03136793T2	Structured bonds	Issue	22/08/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/08/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793U0	Structured bonds	Issue	12/09/2014	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/09/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793V8	Structured bonds	Issue	03/10/2014	2,300	2,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	12/10/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136793W6	Structured bonds	Issue	10/10/2014	3,000	3,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136793X4	Structured bonds	Issue	02/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/10/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793Y2	Structured bonds	Issue	10/10/2014	4,200	4,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793Z9	Structured bonds	Issue	10/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	17/10/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794A0	Structured bonds	Issue	24/10/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	31/10/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794B8	Structured bonds	Issue	24/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	31/10/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136794C6	Structured bonds	Issue	27/10/2014	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/11/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136794D4	Structured bonds	Issue	31/10/2014	2,300	2,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/11/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136794E2	Structured bonds	Issue	31/10/2014	700	700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/11/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794F9	Structured bonds	Issue	31/10/2014	2,400	2,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/11/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136794G7	Structured bonds	Issue	05/11/2014	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/11/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794H5	Structured bonds	Issue	14/11/2014	1,300	1,300	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	21/11/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794I3	Structured bonds	Issue	17/11/2014	1,600	1,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/11/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136794J1	Structured bonds	Issue	28/11/2014	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	07/12/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136794K9	Structured bonds	Issue	12/12/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	19/12/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136794L7	Structured bonds	Issue	19/12/2014	1,250	1,250	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/12/2016

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Parent company	SPAIN	-	ES03136794M5	Structured bonds	Issue	19/12/2014	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	27/12/2016
Bankinter S.A.	Parent company	SPAIN	-	ES03136794N3	Structured bonds	Issue	30/12/2014	4,950	4,950	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/01/2018
Bankinter S.A.	Parent company	SPAIN	-	ES0313679609	Structured bonds	Issue	24/06/2011	1,285	1,285	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/06/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679633	Structured bonds	Issue	03/08/2011	6,775	6,775	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/08/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679658	Structured bonds	Issue	31/08/2011	2,340	2,340	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	31/08/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679666	Structured bonds	Issue	06/10/2011	5,980	5,980	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	06/10/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679674	Structured bonds	Issue	17/10/2011	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	16/10/2015
Bankinter S.A.	Parent company	SPAIN	-	ES0313679708	Structured bonds	Issue	04/11/2011	1,895	1,895	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	04/11/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679732	Structured bonds	Issue	09/12/2011	370	370	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	09/12/2016
Bankinter S.A.	Parent company	SPAIN	-	ES0313679849	Structured bonds	Issue	13/04/2012	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	14/04/2015
Bankinter S.A.	Parent company	SPAIN	-	ES0313679906	Structured bonds	Issue	15/06/2012	550	550	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/06/2015
Bankinter S.A.	Parent company	SPAIN	-	ES0313679922	Structured bonds	Issue	29/06/2012	195	195	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	29/06/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136793K1	Structured bonds in foreign currency	Issue	01/08/2014	680	680	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	08/08/2016
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136792M9	Structured bonds in foreign currency	Issue	25/03/2014	824	824	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	03/04/2017
Bankinter S.A.	Parent company	SPAIN	-	ES03136791C2	Structured bonds in foreign currency	Issue	16/07/2013	824	824	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/01/2015

Name	Relationship with the Group	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 30-12-2014 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee	Maturity date of issue
Bankinter S.A.	Controlling Company (**)	SPAIN	-	ES03136790V4	Structured bonds in foreign currency	Issue	20/05/2013	1,235	1,235	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	15/05/2015
Bankinter S.A.	Parent company	SPAIN	-	ES03136790I1	Structured bonds in foreign currency	Issue	18/12/2012	1,194	1,194	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	18/12/2017
Bankinter S.A.	Parent company	SPAIN	-	ES02136793O5	Structured bonds in foreign currency	Issue	06/08/2014	824	824	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	13/08/2019
Bankinter S.A.	Parent company	SPAIN	-	ES02136792O7	Structured bonds in foreign currency	Issue	16/06/2014	112	1,112	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)	24/06/2019

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of	Rate	Date of	Amount of the Issue, Buy-back or Redemption	Outstanding balance as at 31/12/2011 (€000s)	Type of	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
					Amount	Transaction	Transaction	(€000s)		Rate
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679244	Mortgage bond	Issue	21/01/2013	200,000	200,000	3.25%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679269	Mortgage bond	Issue	23/01/2013	500,000	500,000	2.75%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679251	Mortgage bond	Issue	04/02/2013	200,000	200,000	EURIBOR 3m+3.25%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679277	Mortgage bond	Issue	05/02/2013	500,000	500,000	3.125%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679277	Mortgage bond	Issue	05/02/2013	90,000	90,000	3.125%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679285	Mortgage bond	Issue	08/05/2013	1,300,000	1,300,000	EURIBOR 3m+2.5%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679269	Mortgage bond	Issue	13/05/2013	500,000	500,000	2.75%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)

Bankinter S.A.	Parent company	SPAIN	-	ES03136790J9	Structured bonds	Issue	16/01/2013	2,600	2,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790K7	Structured bonds	Issue	06/02/2013	9,750	9,750	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679246	Structured bonds	Issue	22/02/2013	10,250	10,250	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679253	Structured bonds	Issue	22/02/2013	2,900	2,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790L5	Structured bonds	Issue	01/03/2013	7,000	7,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Operation	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679261	Structured bonds	Issue	08/03/2013	8,400	8,400	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790M3	Structured bonds	Issue	08/03/2013	4,600	4,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790N1	Structured bonds	Issue	14/03/2013	1,350	1,350	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790O9	Structured bonds	Issue	22/03/2013	8,750	8,750	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679279	Structured bonds	Issue	02/04/2013	9,800	9,800	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679287	Structured bonds	Issue	05/04/2013	2,700	2,700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790P6	Structured bonds	Issue	12/04/2013	2,850	2,850	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679295	Structured bonds	Issue	19/04/2013	9,150	9,150	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790Q4	Structured bonds	Issue	12/04/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679303	Structured bonds	Issue	12/04/2013	1,450	1,450	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790R2	Structured bonds	Issue	19/04/2013	5,700	5,700	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790S0	Structured bonds	Issue	22/04/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679311	Structured bonds	Issue	30/04/2013	5,050	5,050	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790T8	Structured bonds	Issue	10/05/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679329	Structured bonds	Issue	13/05/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790U6	Structured bonds	Issue	14/05/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679337	Structured bonds	Issue	31/05/2013	16,321	16,321	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679345	Structured bonds	Issue	24/05/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679352	Structured bonds	Issue	27/05/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790V4	Structured bonds	Issue	14/05/2013	1,500	1,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790W2	Structured bonds	Issue	28/05/2013	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679360	Structured bonds	Issue	13/06/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790X0	Structured bonds	Issue	14/06/2013	5,645	5,645	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790Y8	Structured bonds	Issue	14/06/2013	3,450	3,450	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Operation	Date of transaction	Amount of the Issue, Buy-back or Reimbursement (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679378	Structured bonds	Issue	21/06/2013	16,504	16,504	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679386	Structured bonds	Issue	19/06/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679394	Structured bonds	Issue	10/07/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790Z5	Structured bonds	Issue	01/07/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791A6	Structured bonds	Issue	01/07/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679402	Structured bonds	Issue	12/07/2013	12,525	12,525	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679410	Structured bonds	Issue	15/07/2013	16,450	16,450	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679428	Structured bonds	Issue	03/07/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679436	Structured bonds	Issue	12/07/2013	4,350	4,350	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791B4	Structured bonds	Issue	12/07/2013	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679444	Structured bonds	Issue	26/07/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679451	Structured bonds	Issue	19/07/2013	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of	Rate	Date of transaction	Amount of the Issue, Buy-back or Redemption	Outstanding balance as at 31/12/2011 (€000s)	Type of	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679469	Structured bonds	Issue	12/07/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679477	Structured bonds	Issue	29/07/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679485	Structured bonds	Issue	19/07/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791C2	Structured bonds	Issue	16/07/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679493	Structured bonds	Issue	02/08/2013	4,350	4,350	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679501	Structured bonds	Issue	25/07/2013	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791D0	Structured bonds	Issue	12/08/2013	25,000	25,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679519	Structured bonds	Issue	02/08/2013	1,900	1,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679527	Structured bonds	Issue	29/07/2013	1,900	1,900	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791E8	Structured bonds	Issue	14/08/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of	Rate	Date of transaction	Amount of the Issue, Buy-back or Redemption	Outstanding balance as at 31/12/2011 (€000s)	Type of	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679535	Structured bonds	Issue	09/08/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679543	Structured bonds	Issue	05/08/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679550	Structured bonds	Issue	23/08/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679568	Structured bonds	Issue	30/08/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791F5	Structured bonds	Issue	06/09/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679592	Structured bonds	Issue	27/09/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679576	Structured bonds	Issue	13/09/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679584	Structured bonds	Issue	06/09/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679600	Structured bonds	Issue	04/10/2013	20,000	20,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Type of Operation	Date of transaction	Amount of the Issue, Buy-back or Redemption	Outstanding balance as at 31/12/2011 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136791G3	Structured bonds	Issue	20/09/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679618	Structured bonds	Issue	27/09/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679626	Structured bonds	Issue	04/10/2013	10,450	10,450	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791I9	Structured bonds	Issue	04/10/2013	2,000	2,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791H1	Structured bonds	Issue	04/10/2013	1,800	1,800	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679634	Structured bonds	Issue	16/10/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679642	Structured bonds	Issue	04/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679675	Structured bonds	Issue	18/10/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679659	Structured bonds	Issue	11/10/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of	Type of Operation	Date of	Amount of the Issue, Buy-back or Redemption	Outstanding balance as at 31/12/2011 (€000s)	Type of	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-		ES0213679667 Structured bonds	Issue	30/10/2013	40,675	40,675	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679683 Structured bonds	Issue	25/10/2013	14,500	14,500	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791J7	Structured bonds	Issue	18/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679671 Structured bonds	Issue	18/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679709 Structured bonds	Issue	17/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679717 Structured bonds	Issue	25/10/2013	1,200	1,200	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679741 Structured bonds	Issue	08/11/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679725 Structured bonds	Issue	25/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679733 Structured bonds	Issue	30/10/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-		ES0213679758 Structured bonds	Issue	30/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution								Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES0213679766	Structured bonds	Issue	30/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791K5	Structured bonds	Issue	22/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791L3	Structured bonds	Issue	31/10/2013	3,000	3,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791M1	Structured bonds	Issue	31/10/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791N9	Structured bonds	Issue	15/11/2013	3,150	3,150	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0313679774	Structured bonds	Issue	22/11/2013	8,775	8,775	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791O7	Structured bonds	Issue	15/11/2013	1,100	1,100	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791P4	Structured bonds	Issue	08/11/2013	1,150	1,150	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679782	Structured bonds	Issue	03/12/2013	16,625	16,625	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679808	Structured bonds	Issue	22/11/2013	12,600	12,600	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679790	Structured bonds	Issue	22/11/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution								Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136791Q2	Structured bonds	Issue	12/11/2013	1,500	1,500	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679816	Structured bonds	Issue	27/11/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791R0	Structured bonds	Issue	22/11/2013	1,700	1,700	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679824	Structured bonds	Issue	22/11/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791T6	Structured bonds	Issue	29/11/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES031336791U4	Structured bonds	Issue	29/11/2013	3,000	3,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679832	Structured bonds	Issue	29/11/2013	1,500	1,500	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679840	Structured bonds	Issue	13/12/2013	9,675	9,675	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791S8	Structured bonds	Issue	17/12/2013	3,150	3,150	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679857	Structured bonds	Issue	13/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679865	Structured bonds	Issue	13/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)

	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136791V2	Structured bonds	Issue	20/12/2013	1,200	1,200	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791W0	Structured bonds	Issue	20/12/2013	1,350	1,350	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679873	Structured bonds	Issue	20/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679907	Structured bonds	Issue	27/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679899	Structured bonds	Issue	23/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679915	Structured bonds	Issue	27/12/2013	5,000	5,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter 12 FTH	Subsidiary	SPAIN	Aaa/AAA	ES0313715007	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	-	-	EURIBOR 3m+0.04%	AIAF secondary fixed income market	Mortgage portfolio	Credit Enhancement (7.79%)
Bankinter 12 FTH	Subsidiary	SPAIN	Baa1/AA-	ES0313715015	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	572,267	572,267	EURIBOR 3m+0.12%	AIAF secondary fixed income market	Mortgage portfolio	Credit Enhancement (7.79%)
Bankinter 12 FTH	Subsidiary	SPAIN	Baa1/A-	ES0313715023	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	13,100	13,100	EURIBOR 3m+0.25%	AIAF secondary fixed income market	Mortgage portfolio	Credit Enhancement (5.63%)

Bankinter 12 FTH	Subsidiary	SPAIN	Baa2/A-	ES0313715031	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	11,900	11,900	EURIBOR 3m+0.35%	AIAF secondary fixed income market	Mortgage portfolio	Credit Enhancement (3.68%)
APPENDIX IV	(Continued)
	Details of the Issuing Institution							Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Security	Rate Transaction Date of Transaction	Rate Transaction Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Interest Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter 12 FTH	Subsidiary	SPAIN	Ba2/BB-	ES0313715049	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	11,300	11,300	EURIBOR 3m+2.25%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (1.82%)
Bankinter 12 FTH	Subsidiary	SPAIN	Ca/CCC	ES0313715056	Mortgage securitisation notes	Depreciation and Amortisation	15/03/2013	11,300	11,300	EURIBOR 3m+3.90%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba1/BB-	ES0313679484	Senior	Depreciation and Amortisation	15/01/2013	498,050	498,050	EURIBOR 3m+0.95%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba1/BB-	ES0313679492	Senior	Depreciation and Amortisation	21/01/2013	78,800	78,800	3%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679111	Interest rate swaps	Depreciation and Amortisation	21/01/2013	550,000	550,000	4.875%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679004	Interest rate swaps	Depreciation and Amortisation	04/03/2013	50,000	50,000	EURIBOR 3m+0.27%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679079	Interest rate swaps	Depreciation and Amortisation	09/04/2013	1,400,000	1,400,000	2.625%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	Nominative	Interest rate swaps	Depreciation and Amortisation	15/06/2013	\$90,000	\$90,000	Libor3m-0.04%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba1/BB-	ES0213679121	Senior	Depreciation and Amortisation	17/06/2013	75,000	75,000	Euribor3m flat (min 3%-max 5%)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	A3/A	ES0413679095	Interest rate swaps	Depreciation and Amortisation	23/09/2013	650,000	650,000	3.75%	AIAF secondary fixed-income market	Mortgage portfolio	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679188	Subordinated	Depreciation and Amortisation	10/10/2013	50,000	50,000	EURIBOR 3m+3%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790K7	Structured bonds	Depreciation and Amortisation	08/11/2013	9,750	9,750	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

Details of the Issuing Institution					Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market Type of Guarantee on which Granted traded			Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136790L5	Structured bonds	Depreciation and Amortisation	02/12/2013	7,000	7,000	(*)	AIAF secondary fixed income market		-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790M3	Structured bonds	Depreciation and Amortisation	09/12/2013	4,600	4,600	(*)	AIAF secondary fixed income market		-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790N1	Structured bonds	Depreciation and Amortisation	16/12/2013	1,350	1,350	(*)	AIAF secondary fixed income market		-	Credit Enhancement (0%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790O9	Structured bonds	Depreciation and Amortisation	24/06/2013	8,750	8,750	(*)	AIAF secondary fixed income market		-	Credit Enhancement (7.79%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790P6	Structured bonds	Depreciation and Amortisation	12/07/2013	2,850	2,850	(*)	AIAF secondary fixed income market		-	Credit Enhancement (7.79%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790Q4	Structured bonds	Depreciation and Amortisation	14/10/2013	1,000	1,000	(*)	AIAF secondary fixed income market		-	Credit Enhancement (5.63%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790R2	Structured bonds	Depreciation and Amortisation	21/10/2013	5,700	5,700	(*)	AIAF secondary fixed income market		-	Credit Enhancement (3.68%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790T8	Structured bonds	Depreciation and Amortisation	11/11/2013	5,000	5,000	(*)	AIAF secondary fixed income market		-	Credit Enhancement (1.82%)
Bankinter 12 FTH	Subsidiary	SPAIN	-	ES03136790U6	Structured bonds	Depreciation and Amortisation	14/08/2013	1,000	1,000	(*)	AIAF secondary fixed income market		-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679352	Structured bonds	Depreciation and Amortisation	27/08/2013	5,000	5,000	(*)	AIAF secondary fixed income market		-	Credit Enhancement (0%)

Details of the Issuing Institution				Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136790X0	Structured bonds	Depreciation and Amortisation	16/09/2013	5,645	5,645	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790Y8	Structured bonds	Depreciation and Amortisation	16/09/2013	3,450	3,450	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679386	Structured bonds	Depreciation and Amortisation	19/09/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136790Z5	Structured bonds	Depreciation and Amortisation	08/10/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791A6	Structured bonds	Depreciation and Amortisation	08/10/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679402	Structured bonds	Depreciation and Amortisation	14/10/2013	12,525	12,525	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679428	Structured bonds	Depreciation and Amortisation	10/10/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679436	Structured bonds	Depreciation and Amortisation	21/10/2013	4,350	4,350	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679485	Structured bonds	Depreciation and Amortisation	28/10/2013	1,000	1,000	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)

Bankinter S.A.	Parent company	SPAIN	-	ES0213679493	Structured bonds	Depreciation and Amortisation	11/11/2013	4,350	4,350	(*)	AIAF secondary fixed income market	-	Credit Enhancement (0%)
	Details of the Issuing Institution				Details of Issues carried out in 2013 (a)
Name	Relation to the Bank	Country	Credit rating of Issuer or Issue	ISIN code	Type of Amount	Rate Transaction	Date of Transaction	Amount of the Issue, Buy-back or Redemption (€000s)	Outstanding balance as at 31/12/2011 (€000s)	Type of Rate	Market on which traded	Type of Guarantee Granted	Risks that the Group would assume in addition to the guarantee
Bankinter S.A.	Parent company	SPAIN	-	ES03136791E8	Structured bonds	Depreciation and Amortisation	14/11/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679543	Structured bonds	Depreciation and Amortisation	05/11/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES0213679568	Structured bonds	Depreciation and Amortisation	09/12/2013	5,000	5,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	-	ES03136791G3	Structured bonds	Depreciation and Amortisation	27/12/2013	1,000	1,000	(*)	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679030	Subordinated	Partial amortisation	22/01/2013	2,240	2,240	6%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679139	Subordinated	Partial amortisation	22/01/2013	14,000	14,000	EURIBOR 3m+0.76%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679147	Subordinated	Partial amortisation	22/01/2013	30,000	30,000	EURIBOR 3m+0.80%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679162	Subordinated	Partial amortisation	22/01/2013	10,400	10,400	EURIBOR 3m+0.84%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)
Bankinter S.A.	Parent company	SPAIN	Ba2/BB-	ES0213679170	Subordinated	Partial amortisation	22/01/2013	4,700	4,700	EURIBOR 3m+0.82%	AIAF secondary fixed-income market	-	Credit Enhancement (0%)

APPENDIX V:

Information on the Bankinter Group pursuant to Article 87 of Law 10/2014 of 26 June ("Annual Banking Report"):

This information has been prepared in compliance with the provisions of Article 87 and the twelfth transitional provision of Law 10/2014 of 26 June on the organisation, supervision and solvency of credit institutions, published in the BOE (Official State Gazette) of 27 June 2014, transposing Article 89 of Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 concerning access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC (CRD IV) and repealing Directives 2006/48/EC and 2006/49/EC.

a) Name, nature and geographical location of the business.

Bankinter, S.A. was incorporated by public deed executed in Madrid on 4 June 1965 under the name Banco Intercontinental Español, S.A. Its name was changed to the current one on 24 July 1990. It is registered in the Special Registry of Banks and Bankers. Its tax identification number is A-28157360 and it belongs to the Deposit Guarantee Fund under code number 0128. Its registered offices are located at Paseo de la Castellana number 29, 28046 Madrid, Spain.

The corporate object of Bankinter, S.A. is the carrying on of banking activities. It is subject to the rules and regulations governing banks operating in Spain.

In addition to the operations which it carries on directly, the Bank is the parent company of a group of subsidiary companies dedicated to a variety of activities (mainly asset management, credit cards and the insurance business) which, together with the Bank, make up the Bankinter Group. Consequently, in addition to its own individual financial statements, the Bank is obliged to draw up consolidated financial statements for the Group, which also include holdings in joint businesses and investments in associates.

The consolidated group conducts its business in Spain, except in the case of its subsidiary Bankinter Luxembourg S.A., which conducts its business in another European Union Member State, Luxembourg.

b) Volume of business.

Under this heading we show the information corresponding to the volume of business by countries on a consolidated basis. Volume of business is considered to be the gross margin as shown in the Group's consolidated income statement, for the years 2014 and 2013:

Volume of business (€000s) Spain 1,446,872		Figures as at 31 December 2014
	Luxembourg	1,951
Total 1,448,823

c) Number of full-time employees.

The following information shows full-time employees by countries at the end of 2014 and 2013.

	Figures as at 31 December 2014
	No. of employees
Spain	4,170
Luxembourg	15
Total	4,185

d) Profit before tax.

This heading shows gross profit before tax, on a consolidated basis.

	Figures as at 31 December 2014
	Gross results (€000s)
Spain	395,114
Luxembourg	-2,275
Total	392,839

e) Tax on income

This heading shows tax on profit, on a consolidated basis.

	Figures as at 31 December 2014
	Tax on income (€000s)
Spain	117,633
Luxembourg	-682
Total	116,951

f) Grants, subsidies or public assistance received.

Neither Bankinter S.A. nor any entity in its Group has received any grants, subsidies or public assistance.

G) Return on Assets.

The Group's return on assets during the year, calculated by dividing earnings by the average balance sheet total (sum of balance sheet totals at last two year ends, divided by two), is 0.49%.

Bankinter Group. Management Report for the year ended 31 December 2014

1. Group's performance for the year

1.1 Corporate Activity

Note 13, Investments, to the consolidated financial statements describes the structure of the group: the main subsidiaries and associates, percentages of direct and indirect holdings, main activity, key figures and other information of interest. It also provides information on entities structured by the group, whether consolidated or not, and investment funds, pension funds and SICAVs (open-ended collective investment companies), managed by the group.

During 2014, no corporate activity was carried out that changed the composition of the consolidated group.

During 2013, the Group added the following companies to its consolidation scope:

Company	% control of the Group	Activity
Mercavalor, S.V., S.A.	100%	Sociedad de Valores
Bankinter Luxembourg, S.A.	100%	Private Banking
Naviera Goya, S.L.	100%	Special purpose vehicle
Naviera Sorolla, S.L.	100%	Special purpose vehicle
Castellana Finance Limited	100%	Special purpose vehicle

With the purpose of complementing its private banking strategy, Bankinter, S.A. reached agreement in December 2012 with Dutch bank Van Lanschot Bankiers N.V. to acquire its Luxembourg subsidiary Van Lanschot Bankiers (Luxembourg) S.A. for an amount of €21.55 million, leading to goodwill of €2.45 million being recognised. The agreement was executed and the company accordingly incorporated into the Group in the first half of 2013.

Naviera Goya, S.L. and Naviera Sorolla, S.L. are special purpose vehicles established to support the financing of shipbuilding by Spanish shipyards.

Castellana Finance Limited is a special purpose vehicle established in 2007. This vehicle was initially outside the consolidation scope, basically because the Group retained no material risks or rewards. However, during the first half of 2013 its situation of control was reviewed, and it was concluded that it should be integrated into the Group as at 30 June 2013. This review was undertaken after successive purchases by Bankinter, S.A. of bonds issued by the vehicle, which had also restructured its balance sheet.

During the fourth quarter of 2013 the Group, which held 25.01% of the shares in Mercavalor, S.V., S.A., acquired all the remaining shares in the company, which was accordingly then fully consolidated by the global integration method.

During 2013 the Bank carried out a capital increase in the form of a bonus issue charged entirely to the asset revaluation reserve, which had been approved by the General Meeting of Shareholders on 21 March 2013. The definitive number of ordinary shares issued, each with a nominal value of €0.30, was 313,223,298 and the nominal amount of the capital increase was €93.97 million. Following this issue of new shares, Bankinter's share capital amounted to €263.1 million, divided into 877,029,439 ordinary shares, each with a nominal value of €0.30.

During 2013 the following mandatorily convertible subordinated bonds were voluntarily converted into new Series Iand II Bankinter shares:

• a) On the ordinary voluntary conversion date, 11 May 2013, requests were made for the conversion of 6,130 Series I bonds with a nominal value of €306,000 and 4,469 Series II bonds with a nominal value of €223,000. To meet these conversion requests a total of 146,175 new shares were issued.
• b) On the ordinary voluntary conversion date, 25 October 2013, requests were made for the conversion of 40,896 Series I bonds with a nominal value of €2,045,000 and 1,148 Series II bonds with a nominal value of €57,450,000. To meet these conversion requests a total of 18,408,186 new shares were issued.

1.2. Results

The Bankinter Group posted net income of €275.9 million for 2014, 45.28% more than in 2013. This is the Bank's best net figure for the past seven years. Pre-tax profit for 2014 came to €392.8 million, 50.45% more than in the previous year.

	31-12-2014 31-12-2013		Difference
PROFIT AND LOSS ACCOUNT	Amount	Amount	Amount	%
Interest and similar income	1,404,321	1,476,230	-71,909	-4.87
Interest expense and similar charges	-648,963	-840,326	191,363	-22.77
Interest margin	755,358	635,904	119,454	18.78
Income from equity instruments	8,004	8,946	-942	-10.53
Share in results of entities accounted for using the equity method	16,962	15,545	1,417	9.11
Net fees and commissions	291,407	249,020	42,387	17.02
Income from financial transactions and exchange differences	133,296	228,755	-95,459	-41.73
Other operating income/expense	243,797	200,831	42,966	21.39
Gross Margin	1,448,823	1,339,001	109,822	8.20
Personnel expenses	-368,739	-356,833	-11,906	3.34
Administrative expenses / Depreciation and amortisation	-350,508	-323,013	-27,495	8.51
Operating profit (loss)before impairment	729,576	659,154	70,422	10.68
Provisions	-41,536	-14,259	-27,277	191.30
Losses from asset impairment	-237,508	-289,968	52,460	-18.09
Operating result after impairment	450,533	354,927	95,606	26.94
Gains/losses on derecognition of assets	-57,694	-93,822	36,128	-38.51
Profit before tax	392,839	261,105	131,734	50.45
Income tax	-116,951	-71,204	-45,748	64.25
Consolidated result	275,887	189,901	85,987	45.28

Figures for 2013 restated for purposes of comparison in light of change in accounting principle (see Note 20).

These results are based on sustained growth in the strategic business lines of private banking and business banking and the solidity and profitability of the insurance business, the generation of results from the Bank's institutional portfolios having been largely abandoned. The moderation in costs also consolidated the improvement in the cost/income ratio for banking activity, which came to 44.5%, compared with 45.2% for the previous year.

As regards the various margins in the income statement, the Group's interest margin for the year came to €755.4 million, representing an increase of 18.78% relative to 2013, due essentially to the continued fall in interest rates during 2014, which enabled the group to further reduce its funding costs. Thus, the interest margin for the fourth quarter of 2014 was €210.5 million, 21% more than in the fourth quarter of 2013, the fall in income (-2.29%) having been much less than the fall in funding costs (-23.8%). The improvement in the customer margin is substantial. This improvement in the interest margin was achieved while at the same time reducing the contribution of the institutional fixed income portfolio.

The following table shows an analysis of the effects of changes in average volumes and prices on the pure banking business, i.e. excluding the contribution of LDA to the interest margin. As can be seen, the increase in average loan outstandings is offset by the fall in interest rates, the smaller contribution to interest income from the portfolio of debt instruments and the fall in the cost of customer deposits due to the price effect.

Volume-price effect	Change in Average Balances	Change in Income/ Cost	Volume Effect	Price and combined effects	Total
Customer Lending	354,608	-1,683	44,657	-46,340	-1,683
Debt instruments	-3,188,959	-73,309	-68,916	-4,393	-73,309
Other Assets	1,892,417	-2,040	4,308	-8,711	-4,403
Coverage		7,482		7,482	7,482
Total Assets (a)	-941,933	-69,550	-19,951	-51,962	-71,913
Customer funds	2,771,712	-132,549	9,809	-142,359	-132,549
Negotiable securities	-740,823	-25,513	-13,972	-11,541	-25,513
Other liabilities	-4,308,577	-36,039	-26,091	-9,980	-36,071
Total Liabilities (b)	-2,277,689	-194,101	-30,253	-163,880	-194,133
Financial margin (a)-(b)	1,335,756	124,551	10,302	111,918	122,220

(b)	-2,277,689	-194,101	-30,253	-163,880	-194,133
Financial margin (a)-(b)	1,335,756	124,551	10,302	111,918	122,220	Underwriting and
						Sale and purchase of
The gross margin also showed a positive trend during the year, growing by 8.2%						Administration and
from the previous year, with the reduction in net gains on financial transactions
(down by 41.7%, mainly due to the fall in contribution from the institutional fixed income portfolio) being offset by the notable growth in net fee and commission						On sales of non-banking
income, which was up by 17.02%. Particularly notable within this growth in net fee
and commission income is the strong growth in fees and commissions relating to the asset management business, a strategic priority of the Group, through its Private						Insurance and pension
Banking and Personal Banking operations.

TOTAL FEES AND COMMISSIONS	31-12-2014	31-12-2013	Difference	%
FEES AND COMMISSIONS EXPENSE	73,891	64,063	9,828	15.34
FEES AND COMMISSIONS INCOME
For guarantees and documentary credits	29,522	29,500	22	0.07
For exchange of foreign currencies and foreign banknotes	8,619	7,678	942	12.26
For contingent commitments	16,542	15,819	723	4.57
On collections and payments-	69,798	70,340	-542	-0.77
On securities services	70,747	49,455	21,292	43.05
Underwriting and placement of securities	2,654	1,248	1,406	112.73
Sale and purchase of securities	31,476	22,906	8,569	37.41
Administration and custody of securities	25,008	19,447	5,561	28.59
Wealth management	11,609	5,854	5,755	98.30
On sales of non-banking financial products	127,810	101,478	26,332	25.95
Asset management	83,760	57,687	26,073	45.20
Insurance and pension funds	44,049	43,791	259	0.59
Other fees	42,260	38,814	3,446	8.88
Total fee income	365,298	313,082	52,215	16.68
TOTAL NET FEES AND COMMISSIONS:	291,407	249,020	42,387	17.02

The increase in employee benefits and administrative expenses is related to the investments which the group is carrying out in the organic growth of the business: new recruitments, investments in marketing, and other related investments. This focus on costs enabled the group to maintain and even slightly improve its cost/ income ratio, which stood at 49.64% in December 2014, as against 50.77% in December 2013.

Lastly, in 2014, the group improved the coverage of its legal and tax contingencies, reduced impairment losses on financial assets and curtailed losses on foreclosed assets. The combination of all the above factors led to a 50.45% improvement in pre-tax profit.

		2014		2013
PROFIT AND LOSS ACCOUNT	Q414	Q314	Q214	Q114	Q413
Interest and similar income	354,235	353,646	352,640	343,799	362,527
Interest expense and similar charges	-143,693	-162,479	-168,079	-174,713	-188,548
Interest margin	210,544	191,167	184,561	169,086	173,979
Income from equity instruments	1,397	1,599	1,791	3,217	1,002
Share in results of entities accounted for using the equity method	4,600	4,763	3,791	3,808	4,532
Net fees and commissions	74,842	72,437	73,317	70,811	71,255
Income from financial transactions and exchange differences	22,684	24,872	36,544	49,196	74,045
Other operating income/expense	62,049	55,974	60,948	64,826	57,229
Gross Margin	376,115	350,812	360,952	360,944	382,042
Personnel expenses	-90,281	-93,243	-90,941	-94,274	-97,193
Administrative expenses / Depreciation and amortisation	-88,425	-86,826	-86,971	-88,287	-81,852
Operating profit (loss)before impairment	197,409	170,743	183,040	178,384	202,997
Provisions	-13,390	-6,684	-10,020	-11,441	-6,382
Losses from asset impairment	-63,694	-50,799	-54,852	-68,162	-56,470
Operating result after impairment	120,324	113,260	118,168	98,781	140,145
Gains/losses on derecognition of assets	-20,460	-12,305	-11,864	-13,064	-53,667
Profit before tax	99,864	100,955	106,303	85,717	86,477
Income tax	-29,058	-30,287	-31,891	-25,715	-26,858
Consolidated result	70,805	70,668	74,412	60,002	59,619

the reduction in the cost of customer deposits and on the successful brake on falling returns on lending, in a context of al-time record low interest rates. QUARTERLY RETURNS AND COSTS [figures in %] Q414 Q314 Q214 Q114 Q413 Weighting Rate Weighting Rate Weighting Rate Weighting Rate Weighting Rate Deposits at central banks 0.72% 0.03% 0.70% 0.08% 0.80% 0.14% 0.84% 0.15% 0.77% 0.22% Deposits with credit institutions 6.09% 0.09% 7.90% 0.13% 5.22% 0.27% 4.97% 0.28% 4.46% 0.49% Loans and advances to customers (a) 72.77% 2.65% 71.28% 2.65% 72.60% 2.70% 73.17% 2.68% 72.29% 2.66% Debt instruments 15.06% 3.34% 13.78% 3.70% 14.72% 3.47% 14.24% 3.61% 16.91% 3.46% Equities 0.59% 1.65% 0.59% 1.88% 0.62% 2.07% 0.61% 3.86% 0.57% 1.24% Average earning assets (b) 95.24% 2.60% 94.25% 2.60% 93.96% 2.70% 93.84% 2.71% 95.01% 2.71% Other assets 4.76% 5.75% 6.04% 6.16% 4.99% AVERAGE TOTAL ASSETS 100.00% 2.48% 100.00% 2.45% 100.00% 2.54% 100.00% 2.55% 100.00% 2.57% Deposits from central banks 5.36% 0.06% 4.77% 0.13% 5.35% 0.23% 5.62% 0.25% 9.61% 0.40% Deposits from credit institutions 12.58% 1.56% 11.76% 1.92% 12.34% 1.90% 12.26% 1.91% 11.97% 1.89% Customer resources (c) 69.02% 1.05% 69.83% 1.18% 68.35% 1.30% 68.40% 1.42% 66.16% 1.51% Customer deposits 51.73% 0.84% 51.49% 0.94% 50.58% 1.09% 50.65% 1.24% 49.33% 1.38% Marketable debt securities 17.29% 1.68% 18.34% 1.85% 17.77% 1.89% 17.75% 1.94% 16.83% 1.91% Subordinated liabilities 1.08% 5.00% 1.09% 4.91% 1.11% 4.87% 1.12% 4.94% 1.12% 5.02% Average interest-bearing funds (d) 88.05% 1.14% 87.45% 1.28% 87.15% 1.38% 87.40% 1.47% 88.86% 1.50% Other liabilities 11.95% 12.55% 12.85% 12.60% 11.14% AVERAGE TOTAL FUNDS 100.00% 1.00% 100.00% 1.12% 100.00% 1.20% 100.00% 1.28% 100.00% 1.33% Customer margin (a-c) 1.60% 1.47% 1.41% 1.26% 1.15% Quarterly average total assets (€000) 56,987,518 57,433,280 56,066,028 55,254,371 56,117,481

The customer margin showed constant quarterly growth in 2014, based mainly on

The year 2014 also demonstrated the solidity and good progress of customer business of the Bank, which continues to pursue a strategy focused primarily on the corporate and private banking segments.

CONTRIBUTION BY BUSINESS AREA	31-12-2014	31-12-2013	€000s	%
€000s
Customer segments	868,086	673,336	194,750	28.92
Commercial Banking and Private Banking	344,056	225,858	118,198	52.33
Business Banking	524,030	447,478	76,552	17.11
Capital Markets	299,720	421,635	-121,915	-28.91
Línea Directa	338,953	324,260	14,692	4.53
Corporate Centre	-57,936	-80,230	22,294	-27.79
Gross Margin	1,448,823	1,339,001	109,822	8.20

Figures for 2013 restated for purposes of comparison in light of change in accounting principle (see Note 20).

The capture of new customers maintained a good pace during this past year, particularly in Business Banking, making a positive contribution to the growth in the Bank's lending in this segment of activity:

The increase in the number of new customers also led to an improvement in the capture of retail deposits, where there was a notable preference for sight balances in view of the very low rates of remuneration of term deposits. Apart from this, new term deposits continue to be opened at rates below the average rate of the stock of existing term deposits, so as the term deposit is gradually renewed, the financial cost of retail deposits will continue to fall.

With regard to the strategic businesses, special mention must be made of the healthy figures in Private Banking, in which Bankinter is now a fully consolidated player and a point of reference in the sector. Customer assets in this segment rose by 26% in 2014 in comparison with 2013, to reach €23.1 billion. Bankinter has also maintained its privileged position as leader in the SICAV ranking, with 383 companies managed at the close of the year, 29% more than in 2013, with a market share of 11.9%.

There are two business lines that stand out as promising particularly strong performances in the coming years: consumer finance, which is already starting to post good results, and Personal Banking, which has been re-launched with new teams and products.

As regards Línea Directa, the number of insurance policies and the market share continue to increase. At the close of 2014, the number of policies was up by 6.3% on the previous year, at a total of 2.2 million. This figure includes outstanding growth in home insurance policies: a 19.2% year-on-year increase. Línea Directa's profit before tax for 2014 amounted to €133.9 million, up by 4.2% on 2013, with an individual ROE of 23.7%.

Finally, special mention must be made of the positive performance of BKT shares in this period, with a revaluation of 34.4%, reaching prices close to historical maximums. This is an outstanding figure, especially taking into account the fact that Bankinter was the most profitable bank share in Europe in 2013, with a revaluation of almost 150%. All this shows that Bankinter has achieved credibility and international standing among investors, as reflected both in its share price and in the improvement in its ratings by the main credit rating agencies, which now position the Bank as 'investment-grade'.

1.3. Trends in Deposits and Lending

Customer retail deposits grew by €2.04 billion or 7.22% in the year. At the same time, reliance on wholesale funding was reduced by €1.3 billion or 14.55%. These changes reflect the success of the Bank's funding strategy, based on reducing dependence on wholesale markets and driving the capture of customer retail resources.

Off-balance sheet resources also showed strong growth of 40.66%, with particularly notable increases in AUM of investment funds, wealth management and SICAVs.

Customer funds (€000s)	31-12-2014	31-12-2013	€000s	%
Retail funds	30,310,757	28,268,745	2,042,012	7.22
Government deposits	478,564	1,428,986	-950,422	-66.51
Private sector deposits	25,460,855	23,500,642	1,960,213	8.34
Current accounts	15,084,805	12,098,651	2,986,155	24.68
Term deposits	10,294,690	11,245,992	-951,302	-8.46
Valuation adjustments	81,359	155,999	-74,640	-47.85
Other liabilities at sight	266,062	319,820	-53,758	-16.81
Online marketable securities	4,105,276	3,019,298	1,085,979	35.97
Temporary assignment of assets	684,660	1,876,950	-1,192,291	-63.52
Negotiable securities, wholesalers	7,609,976	8,905,516	-1,295,541	-14.55
Promissory notes and bills of exchange	363,796	644,285	-280,489	-43.53
Securitised notes	2,151,855	2,593,687	-441,832	-17.03
Mortgage-backed bonds	4,316,985	5,393,335	-1,076,349	-19.96
Senior notes	676,914	179,840	497,074	276.40
Valuation adjustments	100,426	94,370	6,056	6.42
Total on-balance sheet resources	38,605,393	39,051,212	-445,820	-1.14
Off-balance sheet resources	16,843,999	11,974,867	4,869,132	40.66
Own investment funds	7,233,279	5,998,747	1,234,531	20.58
External investment funds sold	3,812,032	1,966,424	1,845,608	93.86
Pension funds	1,936,084	1,650,496	285,588	17.30
Management of SICAVs (open-ended collective investment companies)	3,862,604	2,359,200	1,503,404	63.73

Customer lending posted growth of 3%, with particularly notable growth as has been indicated previously, in lending to businesses (+6.7%). There was a sharp increase in new residential mortgage lending, from just over €500 million in 2013 to €1.55 billion in 2014. Off-balance sheet risks grew by around 3%, a similar increase to that in lending to customers.

Total lending (€000s)	31-12-2014	31-12-2013	€000s	%
Loans to government bodies	1,704,402	2,340,652	-636,250	-27.18
Other sectors	40,742,322	38,855,799	1,886,523	4.86
Commercial lending	2,016,997	2,052,599	-35,602	-1.73
Receivables secured by collateral	25,353,414	25,269,668	83,746	0.33
Other non-current receivables	9,899,189	8,449,436	1,449,753	17.16
Personal loans	5,558,167	4,468,648	1,089,520	24.38
Overdraft facilities	3,910,827	3,721,439	189,388	5.09
Other non-current receivables	430,195	259,350	170,845	65.87
Finance leases	968,590	796,605	171,985	21.59
Doubtful debts	2,194,167	2,234,395	-40,228	-1.80
Valuation adjustments	-958,193	-968,822	10,629	-1.10
Other lending	1,268,158	1,021,918	246,239	24.10
Total customer lending	42,446,723	41,196,451	1,250,273	3.03
Off-balance sheet risks	10,964,609	10,639,160	325,450	3.06
Contingent risks	2,736,529	2,401,895	334,633	13.93
Available to third parties	8,228,081	8,237,265	-9,185	-0.11

2014 was a turning point in the balance of problematic assets, being the first year to record a net reduction. As a result, the Bank's NPL ratio in December stood at 4.72%, in comparison with 4.98% one year earlier. This figure is well below the sector average, which stood at 12.75% in November. At the same time, the sum of net additions to NPLs and bad debts continues to decline, with a consequent reduction in the allocation to provisions.

The foreclosed real estate assets portfolio has been reduced after several years' growth in annual terms. At the close of 2014, its gross value was €585.8 million, 6.7% down on the previous year. It also had a cover of 39.1%. Furthermore, it is a very small portfolio in comparison with the other banks and is 44% concentrated in residential properties. The Bank also increased the rate of sale of these assets by 14.5% in comparison with the previous year, proof of both the quality and good condition of the product offered and the Bank's sales capabilities in this business.

As regards solvency, Bankinter reached the end of the year with a CET 1 ratio of 11.87% as per Basel III criteria. The fully loaded CET 1 capital ratio stood at 11.5% in December, one of the highest in the sector.

In parallel with this, it should be stressed that Bankinter has a comfortable, well-balanced debt maturity structure, without concentrations, with €1.2 billion maturing in 2015 and €1.4 billion in 2016. To meet these, the Bank has €6.1 billion in liquid assets and the capacity to issue mortgage-backed bonds for up to €5.3 billion.

In addition, Bankinter has improved its financing structure, with a ratio of deposits to lending of 78.3% in comparison with 76.5% one year ago, and a liquidity gap down by €1.5 billion relative to year-end 2013. The loan to deposit (LtD) ratio is calculated as lending minus the securitised portion sold in the markets as a percentage of customer deposits (retail and institutional) plus ICO financing.

A more in-depth analysis of the various risks to which the group is exposed can be found in Note 45 to the Consolidated Financial Statements and in the 'Information of Prudential Relevance' Report.

1.4. Trends in business segments

CORPORATE BANKING

Corporate Banking Segment

The year 2014 was marked by an improvement in the economic situation, although the reactivation of Spain's main macroeconomic variables has yet to translate into increased borrowing demand from companies as a whole. Against this background of deleveraging, Bankinter was one of the few banks to succeed in increasing its corporate lending portfolio.

Within this situation, the Business Banking segment continued with a clear strategy of growth in financing its customers by granting credit facilities both for operational requirements and for long-term investment projects, and especially to support companies in their internationalisation processes.

Over the past few years Bankinter has stood out as an exception to the general contraction in bank lending, and in 2014 it succeeded in meeting its objectives of increasing business lending. To be precise, corporate lending grew by 6.7% over the course of the year to reach €18,892 million.

One clear indication of the dynamism of this business segment was the commercial success of the special lines of credit linked to the ECB financing line launched in July, several months ahead of the rest of the sector. From its launch in the summer through to the end of December, Bankinter granted more than 4,000 loans and credit facilities to companies, for a total volume of €1,412 million.

SMEs accounted for 83% of these transactions. Also, these special credit facilities became one of the main ways of winning over new customers to the Bank: 37% of transactions under these lines were with new customers.

We would highlight not only the increased number of new customers in the year, but also the good returns and the slashing of €131 million of negative impact in non-performing company loans on the profit and loss account.

Bankinter's value proposition to this segment continues to be based on the multi-channel approach and on service quality, with constant improvement in satisfaction levels perceived by customers. A reflection of the success of this model for relations with companies can be seen in the strong growth in the volume of transactions carried out in confirming (up by 13%, compared with a 5% decrease in the sector), domestic factoring (up 11% while the sector declined by 8%) and handling of corporate tax payments (up by 17% as against 4% for the sector).

Corporate. Bankinter has always focused on helping large companies, which are included in this customer segment, to attain their objectives, collaborating on their internationalisation and supporting them wherever necessary.

Following a number of years of scarce liquidity, in which the financial markets were effectively closed, in 2014 abundant financing arrived from the ECB. At the same time wholesale financing became cheaper, leading many private institutions, mainly large but also some medium-size companies, to issue their own debt in the markets after six years of paralysis.

Within these companies' deleveraging process centred on improving their cash positions and opening up to new markets, Bankinter has made great efforts to adapt to their requirements, offering products tailored to their new needs. During 2014 for example we launched a new commercial monitoring platform which provided us with a more reliable approximation of the day-to-day reality of each company. A project which will culminate in the next few years in the launch of a totally renewed management process.

Small and medium enterprises segment

In 2014 Bankinter once again gave clear expression to its commitment to the economic development of small and medium enterprises. Facilitating their financing by making resources available on favourable conditions, at longer terms, with flexible drawdowns or low interest rates, was a constant throughout the year. It is important for financial institutions, especially the more solvent ones, to play an active part, together with public institutions and regulators, in encouraging the flow of credit to businesses so as to enable them to finance themselves at a similarly competitive level to their European counterparts, so that together we can bring about the much-needed reactivation of the economy.

To this end, during the year Bankinter signed financing agreements with various national and international bodies. For example, it was the first Spanish institutions to reach an agreement with the European Investment Fund (EIF) for the financing of innovative SMEs, and it has signed another similar agreement with the European Investment Bank (EIB) to finance €400 million worth of investment projects promoted by SMEs (up to 250 employees) and medium-sized companies (up to 3,000 employees) in the industrial and service sectors. As part of this same drive, the Bank has signed similar agreements with ICO (Instituto de Crédito Oficial, Spain's state finance agency) and with the mutual guarantee societies. This is all taking place against a background in which the overall volume of lending by financial institutions to the Spanish business sector continues to fall.

Corporate	2014*	2013	% Diff.
Number of new customers captured	1,917	2,050	-6.5%
Average controlled resources (€ millions)	6,629	6,761	-1.9%
Average customer deposits (€ millions)	6,346	6,480	-2.1%
Average investment (€ millions)	11,202	10,834	3.4%
Small and medium-sized enterprises	2014	2013	% Diff.
Number of new customers captured	16,269	13,142	23.8%
Average controlled resources (€ millions)	5,489	4,903	11.9%
Average customer deposits (€ millions)	4,811	4,314	11.5%
Average investment (€ millions)

COMMERCIAL BANKING

Retail segment

For the whole year 2014, Bankinter had average controlled resources in this segment of €4,474 million and average lending of €14,140 million, making Retail Banking one of the Bank's main areas of activity. 2014 was one of the best years in its history as far as winning over new customers is concerned (32,259, which is 38% more than in the previous year) thanks to the demand for products such as the payroll account and the mortgage loan. New mortgage lending to customers in the Retail network posted growth of 252%, reaching €542 million in 2014.

Average customer deposits also grew strongly, by 14%, to reach €3,529 million. However there was a slight fall of 3% in the volume of fixed deposits, in a context of record low interest rates.

The two pillars on which the Retail strategy is based are firstly cross-selling, which is used to ensure that relationships will be long-lasting; and secondly, consumer finance products, such as credit cards and consumer loans. These types of product are aimed at customers, but the Bank's intention going forward is to extend sales to take in non-customers too.

	2014	2013	% Diff.
Number of new customers captured	32,259	23,382	38.0%
Average controlled resources (€ millions)	4,474	3,882	15.2%
Average customer deposits (€ millions)	3,529	3,102	13.7%
Average investment (€ millions)	14,140	14,765	-4.24%

Foreign Customers Segment

The Foreign Customers segment covers non-Spanish customers requesting financing to buy a residence in Spain and requiring specialised services. It is a business that Bankinter handles in differentiated form on the Mediterranean coast and in the Balearic and Canary Islands.

Average controlled resources in this segment amount to €232 million and average lending to €601 million. The margin improved by 6% relative to 2013 and the number of new customers increased by 54%. This segment has traditionally been less volatile than the Retail segment. At the worst points in the crisis it contracted much less sharply than the domestic business did, and now it is recovering more strongly.

In this segment the situation of customers' countries of origin is crucial. For example British customers, who were more active in the past due to the strength of the pound against the euro, have given way to Germans, Scandinavians and French. There has been a notable increase in demand from French customers as a result of changes in the tax law penalising owners of secondary residences in France.

For foreigners too, quality of service is essential. To provide appropriate service to this customer group, Bankinter has a highly trained workforce, with knowledge of languages and familiarity with the specific needs of foreign customers.

	2014	2013	% Diff.
Number of new customers captured	2,796	1,819	53.7%
Average controlled resources (€ millions)	232	196	18.4%
Average customer deposits (€ millions)	209	177	18.1%
Average investment (€ millions)	601	628	-4.1%

Private Banking Sector

Bankinter made strenuous efforts to improve in Private Banking throughout 2014. In the first place, it strengthened its team of private bankers, which now numbers 205. But as well as quantitatively, the team improved qualitatively thanks to an ambitious training plan which includes in-house rotation to improve employees' knowledge of the area. The training is intensive and continuous, focusing on matters such as management and advisory services, tax aspects, regulatory compliance, products, etc.

Bankinter also launched a range of specific products for customers in this segment, which performed well from a sales point of view and in terms of profitability. Also, in the Bank's asset management subsidiary Bankinter Gestión de Activos, a team was set up to focus specifically on the investments of this type of customers.

As a result of these efforts, the number of new customers captured increased by 31% to 5,239 and assets under management reached €23,094 million, growing by +26% in the course of the year. Average deposits and investment posted increases of 28% and 7% respectively.

In parallel, Bankinter consolidated its lead position in the SICAV (open-ended collective investment company) ranking, with 383 companies managed, placing it second in the sector, with a market share of 11.9%. This means that practically one in every three new SICAVs established during the year was Bankinter's.

These figures confirm the success of the transformation of this segment, which was started in 2012. Now that this process is well under way, the Bank is well aware of the solidity of its model, and aspires to become Spain's best Private Banking institution.

The improvement in the Service Quality index for its part denotes that the quality perceived by customers is highly satisfactory and responds to Bankinter's differential values in Private Banking:

Broad sense of responsibility in advising customers.

A workforce that is highly engaged with the Bank.

Brand recognition, image of solvency and safety.

Senior Management closely involved.

Powerful management of reporting.

Rigorous selection processes to capture the best private bankers in the country.

Professionals sharply focused on market analysis.

Tax area with excellent quality and involvement.

	2014	2013	% Diff.
Number of new customers captured	5,239	4,007	30.7%
Average controlled resources (€ millions)	13,206	10,328	27.9%
Average customer deposits (€ millions)	6,223	5,343	16.5%
Average investment (€ millions)	2,369	2,213	7.0%

Personal Banking Segment

In 2014 the Personal Banking division saw the mortgage lending business start to revive after several years of crisis, and the fall in lending starting to slow, which led to significant growth in both controlled resources (13.7%) and average lending (1.3%). The sales efforts and the improvement in the quality of the service led to a 14% increase in the number of customers captured in the year, to 26,781 new customers. This segment is consolidating its position as the Bank's second biggest by number of active customers.

Personalised service is the hallmark of Personal Banking, in which Bankinter analyses the particular needs of customers, adapts the products to each profile and helps to manage and organise financial planning.

Arising from the transformation of the Private Banking area, we detected that there was a group of personal banking customers that required better service and greater proximity. And the knowledge and experience acquired in the successful transformation of private banking could be used to meet these needs and grow strongly in a medium-high income segment in which Bankinter has historically had a significant presence.

With the transformation of this division, which will continue throughout this year and next, Bankinter seeks to bring the Personal Banking client the best of Private Banking. To this end significant investments are being made in technology, developing new products and training the professionals in this segment.

Conditions are conducive to growth in this segment, due to the restructuring of the sector, which has reduced the number of institutions with an active presence in this business; the reactivation of the mortgage lending market and growing customer demand for advisory services and investment products in a zero interest rate environment.

	2014	2013	% Diff.
Number of new customers captured	26,781	23,542	13.8%
Average controlled resources (€ millions)	12,172	10,705	13.7%
Average customer deposits (€ millions)	7,720	7,131	8.3%
Average investment (€ millions)	7,266	7,176	1.3%

BANKINTER CONSUMER FINANCE

Bankinter intensified its commitment to the consumer finance business during 2014, with the long-term strategic objective of turning it into a third source of revenue to join pure banking and insurance. The gap that has opened with the crisis and the business opportunities that exist have helped Bankinter Consumer Finance - Bankinter's credit card and loan specialist - to consolidate its position in the consumer finance sector. Not only strengthening its distribution of revolving cards through strategic alliances but also, with a view to the future, expanding its offering of automotive financing, consumer finance, points of sale and direct business.

The main mission of Bankinter Consumer Finance is to meet customers' financing requirements by providing them with flexible means of payment for managing their day-to-day finances. All this with the Bankinter style, with innovation, in multi-channel mode, disintermediating the market and putting its ability to work with partners, its flexibility and agility, its knowledge and long-term commitment to work in the service if its customers.

Throughout 2014 the Bank pursued a risk management policy focused on the risk-return trade-off, adjusting the price of each offer in line with the customer profile so as to ensure profitability.

Bankinter has designed a new website for its Obsidiana brand (obsidiana.com) and incorporated the partner card to its commercial offering. It has also created the private operating zone, in which customers can sign their transactions by mobile phone with a one-time password.

Consequently, during this past year Bankinter Consumer Finance saw its customer base grow by 9% compared with 2013, reaching a total of 512,367 cards issued at year-end.

The portfolio maintained its quality and in 2014 average customer lending came to €419 million, growing by 9% against 2013. The gross margin also grew by 7% and the cost of non-performing loans was held at well-controlled levels.

In short, in 2014 we designed a project for Bankinter Consumer Finance to take advantage of a great business opportunity, moving before the major players do and placing itself among the top group in the ranking for this business.

Bankinter means of payment

The stock of cards issued increased by 7% in 2014, surpassing one million cards (including those of the Bank and Obsidiana). The number of transactions carried out in merchant outlets reached 51.5 million for the year, an increase of 11% on the previous year, while the total volume increased by 8% to €4,509 million.

As for the acquiring business, we continue our activity with businesses and merchant outlets, with a similar growth to that of recent years, reaching a total volume handled in 2014 of €1,414 million in 26.5 million purchase transactions, representing growth on the previous year of 20% and 15% respectively.

With regard to the ATM business, we have a network of 392 installed terminals from which 3.6 million cash withdrawals were made during the year by customers and non-customers, totalling €538 million, representing an increase of 26%.

Bankinter Consumer Finance

During 2014 we continued to emphasise pre-approved loans, which are available to the majority of active private individual customers. Their main feature is the quick, easy sign-up via the Bank's various channels, the Internet being the one used most, with 67% of sign-ups. The number of new personal loans in 2014 reached 12,364.

Hal Cash

Hal-Cash is the system that allows customers to send money to anyone's mobile phone so that it can be withdrawn from an ATM without using a bank card. Once the customer of one of the entities belonging to the system has sent the money to the beneficiary's mobile phone, the beneficiary receives an SMS with a code generated by the payment system itself, with which to validate the cash withdrawal at any cash point or PST of a member entity without the need to use a bank card or, indeed, to even have a bank account.

During 2014 Hal-Cash obtained a new patent, this time from the United States, to implement its cash transfer service. This brings the number of countries recognising this instant cash payment system to 13.

During 2014 Hal-Cash was used by 14,364 customers, who made a total of 140,258 payments for a total amount of €36,642,130.

The main value offered by this service is the instant nature of the payment, since the fact that it is made via SMS enables the beneficiary to withdraw the money immediately, as opposed to the traditional system of transfers, which requires more time to execute and can even take several days. Hal-Cash helps unbanked people to gain access to financial services, and is particularly attractive to immigrants, making it easier for them to remit funds.

Relanza

Relanza Gestión us a wholly owned subsidiary of Bankinter Consumer Finance which handles the telephone part of the business in this area.

LDA

Línea Directa Aseguradora, a wholly-owned subsidiary of Bankinter, is the leading company in direct sales of insurance in Spain, with a market share of close to 60% among companies without intermediation. As well as maintaining the highest rate of growth in the sector, it also boasts one of the best Satisfaction Indices, consolidating its position as a benchmark for quality, profitability and job creation, with a workforce of nearly 2,000 professionals and a portfolio of more than 2.2 million policies at the end of 2014.

Línea Directa operates in the Motor and Home branches, and is special in that its products are only distributed by phone or over the Internet, enabling it to offer its customers high-end services at very competitive prices. In this respect its business model, direct and without intermediaries, is based on direct contact with customers, prudence in selecting risks and sales strength, making it very flexible from an operational standpoint in what is a very complex economic setting.

By business lines, Home insurance, which has to cope with a flat property market and a product traditionally linked to mortgages, has shown strong growth, surpassing 300,000 policies, while in the Auto branch, Línea Directa is succeeding in restoring growth in premiums, following several years of sectoral decline caused largely by transfers of coverage and plummeting sales of new vehicles.

For their part, Penélope Seguros, a product designed by women, and Nuez, a brand that is revolutionising the sale of insurance through the Internet and social networks, have consolidated their positions as engines of growth for the group, contributing specialisation, diversification and flexibility to the company's product portfolio. Furthermore, Nuez has consolidated its position as the sector leader in social networks, with more than 200,000 followers on Facebook and nearly 30,000 on Twitter.

A benchmark in reputation. For the third consecutive year, Línea Directa confirmed its status as one of the companies with the best reputations in Spain, according to the MERCO Empresas 2014 report, reaching 55th place and rising nine places relative to 2013. In this way, thanks to its financial results, its responsible practices and its communication strategy, the company has also consolidated its upward trend in this ranking, rising 27 places in just two years.

By sector, the company has also risen one place, reaching fourth position in the ranking of insurance companies and consolidating its position as the company with the most growth in the Auto branch. Moreover, in the opinion of the business journalists consulted by Merco, Línea Directa is ranked tenth in terms of reputation for all companies in all sectors in Spain, up ten places from the previous year.

Miguel Ángel Merino, new CEO of the Línea Directa Group. In January 2014, the Board of Directors of Línea Directa Aseguradora appointed Miguel Ángel Merino as CEO of the company, in recognition of his work as General Manager of the insurance Group, a position he has held since October 2010.

In his four years at the head of Línea Directa, Miguel Ángel Merino has driven a strategy based on innovation, quality and commitment to people, which has enabled the company to increase its customer portfolio by more than 400,000 policies.

Miguel Ángel Merino has spent most of his professional career with Línea Directa Aseguradora, which he joined in 1995 as Manager of the Accident Processing department, forming part of the small group of people involved in the company's creation and launch.

Social responsibility and engagement. Línea Directa seeks to contribute towards raising awareness and promoting good habits in society. In this regard, the 2014- 2016 CSR Plan, called 'Aquí y Ahora' ('Here and Now') is based on values such as road safety, equal opportunity, transparency, integrity, personal development and respect for the environment, which form the backbone of Línea Directa's corporate culture.

The Plan is structured in four distinct spheres of action: Home, Highway, Climate and Corporate. In the 'Home' sphere, the company carried out an important study entitled 'Risks and accident rates in Spanish homes', while in the 'Road' sphere it held the eleventh anniversary edition of the Journalists Road Safety Awards, which seek to encourage the publication of news about road safety. The presentation ceremony, held in the Teatros del Canal in Madrid, was chaired by Pere Macías, Chairman of the Parliamentary Committee on Road Safety and Sustainable Mobility and sponsor of the Línea Directa Foundation.

The company also carried out various initiatives such as the creation of the 'Talento' scholarship training programme for postgraduate and masters students and the launch of an original campaign for students aged between 19 and 25 with good grades. In this way it became the first insurer to offer discounts to students with good academic records.

Lastly, in the 'Corporate' sphere, it continued to develop numerous initiatives, all of which have people as their common denominator, and which included a variety of actions in the fields of volunteer work, equal opportunity, training and work-life balance.

Over the course of 2014, Línea Directa received such important recognition as the five awards in the Twentieth Sectoral Insurance Fraud Detection Contest, including the prize for the best case, an investigation carried out by Línea Directa into a web of false claims which in recent years had succeeded in defrauding several insurers. The company donated the prize in full to the Guardia Civil, in recognition of its work and professionalism.

Línea Directa also won the ICEA awards for the best claims processor, the best technical assessor, the best detective and the most participative company in the Motor branch.

Recognition was also given to Línea Directa's Advanced Repair Centre, which was named the best body repair shop in the Master Painters awards.

'Suma en Línea' Loyalty Programme. Línea Directa has created the first plan focusing on cementing the loyalty of the more than two million customers that the insurance group has in Spain. Associated with the totally free SUMA points card, with which points can be accumulated with expenditure relating to the vehicle, such as refuelling, repair and maintenance and roadworthiness tests, among others, the programme enables customers to pay less for renewing their car insurance.

The insurer's top-level partners in this initiative are CEPSA, Norauto and Midas.

2. Solvency and management of Capital

Applicable laws and regulations

On 1 January 2014 Regulation (EU) 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms (the Capital Requirements Regulation or CRR) came into force, together with European 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 their prudential supervision. The two instruments together constitute the transposition into European law of the new solvency rules known as BIS III, and regulate the levels of solvency and the composition of the computable resources with which credit institutions must operate.

The new rules impose much more demanding capital requirements on institutions, and to avoid this strengthening of solvency unduly affecting the real economy, certain aspects of it will be phased in gradually between now and 2019. This transitional implementation phase mainly affects the definition of resources computable as capital and the establishment of capital buffers over and above the regulatory minimums.

Banco de España Circulars 2/2014 of 31 January and 3/2014 of 30 July establish the schedule for applying the various aspects of the regulations in Spain. Additionally, certain aspects of the regulations are subject to further developing regulations on the part of the EBA (European Banking Authority), the main purpose of which is to establish uniform principles of implementation throughout the European Union. Over the course of 2014, the EBA published a large number of technical standards, guides and recommendations developing numerous aspects, but many still remain in the process of consultation or study, and will be tackled, approved and published during the next few years.

Management of equity

The principle laid down by Bankinter's Board of Directors in relation to the management of its equity consists in operating with a level of solvency in excess of that established by applicable laws and regulations, appropriate to the risks inherent in its business and in the environment in which it operates. The objective is the continuous strengthening of solvency, as a basis for sustained growth and long-term value creation for shareholders.

In order to meet this goal, the Group has a series of policies and processes for managing equity, the main guidelines in which are:

• The Board of Directors and Senior Management are actively involved in the strategies and policies concerning the management of the Group's capital. The objective is to maintain robust solvency ratios of appropriate quality, consistent with the Bank's risk profile and its business model.
• The Equity and Basel Directorate, which is under the Capital Market Division, performs monitoring and control of solvency ratios, and has warning systems that ensure that the applicable rules are being applied at all times and that the decisions made by the various departments and units in the entity are consistent with the targets set for compliance with minimum capital requirements. Accordingly, there are contingency plans to ensure that the limits laid down in the applicable regulations are met. There are independent units entrusted with the validation, control and auditing of these processes.
• The Group uses internal ratings based (IRB) methods to calculate capital requirements for the credit risk on certain credit exposures, which have been validated and approved by the Supervisor. For all other exposures the standard methods described in the regulations are applied. In the next few years new portfolios will be incorporated into the IRB Approach in accordance with a progressive implementation plan agreed with the Supervisor.
• The impact that decisions will have on the Group's equity and on the balance between capital consumption, risk and return, is taken into account as a key factor in planning, analysing and monitoring the Group's operations.

• Capital planning is carried out annually and periodically monitored by the Management Bodies in order to detect and deviations and take any corrective measures that may be appropriate. Within this planning process, stress tests are carried out enabling the Bank's resistance in particularly adverse economic scenarios to be monitored.

The Bank considers its computable equity and the capital requirements established by law to be key factors in its management, affecting investment decisions, the analysis of the viability of transactions, the strategy for distributing profits and issues by the parent company, the subsidiaries and the Group, etc.

Evolution of equity during the year

The minimum level of solvency required by the new regulations is calculated by dividing computable capital by risk-weighted assets.

The definition of computable capital in the new regulations is stricter than before, basically because it introduces new deductions from capital, and because certain instruments are no longer considered as capital since they do not meet the new criteria of loss absorption.

First-class quality capital is called CET1 (Common Equity Tier 1) and basically comprises capital and reserves, minus a number of items such as treasury stock, intangible assets and certain significant investments.

After CET1 comes AT1 (Additional Tier 1) which basically consists of certain instruments with a high loss absorption component in that they would outrank only shareholders in the event of liquidation.

Last comes T2 (Tier 2) which basically consists of instruments that absorb losses only after shareholders and AT1 instruments, being subordinated to common creditors.

Further details of the characteristics of these instruments with regard to their the ability to absorb losses, availability, permanence and ranking of claims in the event of liquidation can be found in the "Information of Prudential Relevance" document, which is published on the Bank's corporate website. This report also shows a reconciliation of accounting equity with computable capital.

Risk-weighted assets are determined by reference to the entity's exposure to credit and counterparty risk, the risk of the trading portfolio and operational risk.

The Regulation also establishes limits on risk concentration and certain mandatory aspects with regard to corporate governance. It also includes two new ratios relating to liquidity and a leverage ratio. The Liquidity Coverage Ratio (LCR) aims to measure the short-term liquidity of the entity and will be implemented in 2015, while the Net Stable Funding Ratio (NSFR), which measures the entity's level of stable funding in the medium term, is still being calibrated. The leverage ratio seeks to limit excessive gearing and to ensure that institutions maintain assets in proportion to their level of capital, so as to try to avoid traumatic deleveraging in times of recession. This ratio is also in the process of being calibrated, although entities are obliged to publish it starting in 2015.

Consolidated equity as at 31 December 2014 and 2013 and the corresponding capital ratios are shown in the following table:

	31-12-2014	31-12-2013	€000s	%
Capital	269,660	268,675	985	0.37%
Reserves	3,137,032	3,031,696	105,335	3.47%
CET1 deductions	-120,214	-302,730	182,515	-60.29%
Preferred shares	46,669	61,284	-14,615	-23.85%
AT1 deductions	-282,947	-194,431	-88,515	45.53%
CET 1	3,050,199	2,864,494	185,705	6.48%
CET 1	11.87%	12.04%	-0.17%	-1.41%
TIER 1	3,050,199	2,864,494	185,705	6.48%
Tier 1 (%)	11.87%	12.04%	-0.17%	-1.41%
Tier II instruments	421,747	455,693	-33,946	-7.45%
Tier II deductions	-112,427	-152,096	39,670	-26.08%
Tier 2	309,320	303,597	5,723	1.89%
Tier 2 (%)	1.20%	1.28%	-0.07%	-5.67%
Total computable equity	3,359,519	3,168,091	191,428	6.04%
Solvency ratio	13.07%	13.31%	-0.24%	-1.82%
Total risk-weighted assets	25,703,876	23,798,935	1,904,941	8.00%
of which credit risk	22,156,903	20,689,395	1,467,507	7.09%
of which market risk	381,580	279,885	101,694	36.33%
of which operational risk	1,773,375	1,583,250	190,125	12.01%

For purposes of comparison, capital and capital requirements for 2013 have been recalculated to bring them into line with the regulations in force since 1 January 2014. The ratios as at December 2013, with the rules in force at that time (Banco de España Circular 3/2008 on the determination and control of minimum capital) were:

• Tier 1 ratio (%): 12.91%
• Tier 2 ratio (%): 1.23%
• Solvency ratio (%): 14.13%

In December 2014 the top-quality (CET1) ratio was 11.87%, well in excess of the regulatory minimum required by the regulations in force. The overall solvency level was 13.07%. During the year the ratio fell by 17 basis points, basically because of the impact on the Group's consolidated reserves of the adoption of IFRIC 21 on levies, and the increase in business in 2014. We now go on to explain in more detail the main changes in each of the levels of capital.

The changes in (CET1) in 2014 were basically due to retaining part of the earnings for the year, applying to reserves the adjustment in respect of the DGF as a result of adopting IFRIC 21, and the change in accounting treatment of the goodwill deduction, which pursuant to Banco de España Circular 3/2014 has only partly to be deducted from CET1 since July 2014.

Changes in AT1 during the year came from the gradual elimination (20% in 2014) of the €58.34 million issue of preferred shares, which are no longer eligible as AT1 under the new regulations. The deductions increased basically because of the incorporation of part of the goodwill deduction which is no longer deducted from CET1.

Tier 2 capital (T2) reduced as a result of the fact that certain subordinated debt issues started to be no longer considered as capital, either because they were nearing their maturity or because they did not meet the stricter eligibility criteria contained in the current regulations.

As regards risk-weighted assets, there was an increase as a result of the Bank's increase level of business which affected credit risk, market risk and operational risk.

European Central Bank Comprehensive Assessment

Between November 2013 and October 2014 the European Central Bank carried out an exercise to assess the financial health of 130 banks in the euro zone (including Lithuania), covering approximately 82% of total banking assets. This Comprehensive Assessment served as an initial evaluation of euro zone banks as a preparatory step to the European Central Bank's taking charge of the supervision of these banks.

The Comprehensive Assessment consisted of three distinct phases:

• First, a review of the banks' main risk factors, by means of a quantitative and qualitative "Supervisory Risk Assessment".
• Secondly, an "Asset Quality Review" (AQR) using 31 December 2013 as the reference date.
• Lastly, a stress test with a three-year time horizon for a base scenario and an adverse scenario, in collaboration with the European Banking Authority.

The results of the Comprehensive Assessment, detailed by bank, can be consulted on the supervision page of the European Central Bank's website at:

https://www.bankingsupervision.europa.eu/banking/comprehensive/html/index. en.html

The specific results of Bankinter can be viewed on the Banks corporate website (https://docs.bankinter.com/stf/web_corporativa/accionistas_e_inversores/hechos_ relevantes_cnmv/2014/hr_test_estres_bce_octubre_2014.pdf) or on the website of the CNMV (National Securities Market Commission (http://www.cnmv.es/Portal/HR/ verDoc.axd?t={a68ef5d2-bab0-4603-99f8-68a631f51370}).

No accounting deficiencies, inadequacy of provisions or other circumstances came to light as a result of the Comprehensive Assessment that have led Bankinter to alter its accounting policies and/or methodology for estimating provisions or any other accounting estimate. Consequently, the financial statements for 2014 as drawn up and approved by the Board of Directors of Bankinter do not include any adjustments deriving from the aforementioned Comprehensive Assessment.

3. Principal business risks

Economic Environment and International Markets

Spain, Germany and Ireland are among the European countries with the best prospects of recovery following the structural reforms implemented.

The robustness of the US economy is in contrast to the return to recession in Japan and the weakness of the emerging countries.

Uneven growth. World economic recovery continues, although it is by no means free of obstacles. Trends in the various different regions continue to be asymmetric. The United States, for example, stands out due to the strength of its economy, but in the euro zone there are clearly considerable differences in the pace of advance of the member countries. Germany, Ireland and Spain stand out positively, while France and Italy lag behind somewhat as a result of not having implemented sufficient structural reforms. Japan is advancing slowly, despite the aggressive monetary policy applied by its central bank and, finally, the emerging countries are in the weakest position as far as global economic recovery is concerned, affected by serious internal and external imbalances.

The common denominator of the main developed economies has been the strong support shown by their respective central banks to the economy, applying highly accommodative monetary policies with the aim of stimulating GDP growth in a context in which the level of price inflation is generally very low.

In Europe the central bank has cut the key interest rate on two occasions, to the current 0.05%, with a negative deposit rate (-0.20%) and offering strong support to the economy. The upturn in Europe continues, as is reflected by four consecutive quarters of year-on-year growth in GDP. This objective has been attained in spite of the process of deleveraging that is under way, the orders to reduce public spending and the insufficient introduction of structural reforms by certain member countries. Lastly, the European economy has benefited from the fall in the price of oil, a low level of inflation – which even turned negative in December – and the depreciation of the euro, which makes its companies' exports much more competitive.

Spain continues to face profound internal imbalances, such as unemployment, and

external ones such as the loss of momentum of the euro zone and particularly of France, its main trading partner. Despite this, the situation is encouraging: the introduction of structural reforms is starting to bear fruit, there has been an improvement in external competitiveness and a reduction in financing costs – as can be observed in the narrowing of the spread over German bonds - which, together with cheaper energy and the depreciation of the euro, has allowed the economy to grow at considerably faster rates than the rest of the surrounding countries (+1.6% YoY in Q3 2014). Moreover, although unemployment remains high, the improving trend is consolidating and in 2014 apparently just over 417,000 jobs were created.

In the United States the Federal Reserve, despite having ended its last asset purchase programme (QE3), continues to apply an expansive monetary policy, holding interest rates at low levels. Major macro indicators reflect the robustness of the US economy, such as strong job creation, improving confidence, the uptick in consumer spending and the good progress of the real estate market and industrial output. Japan faces a complex situation including the return to recession and the fiscal adjustment that it has to complete, not forgetting last April's increase in VAT, which had a negative impact on consumer spending. In the political sphere, Prime Minister Shinzo Abe won new elections, but has yet to announce any measure suggesting that the 'third arrow' of so-called 'Abenomics' is about to be launched. All this, together with the high level of debt (226% of GDP), prompted Moody´s credit rating agency to downgrade the country's rating by one notch from Aa3 to A1. On the positive side, the yen continued to depreciate, which provides support to growth through exports.

The emerging countries for their part are showing obvious signs of weakness. Some of them are affected by large fiscal deficits, depreciation of their currencies, high levels of inflation and the fall in commodity prices, particularly oil. This situation has very damaging consequences for Venezuela, Brazil and Mexico, and is especially difficult for Russia, 50% of whose fiscal revenue comes from oil and gas, to which must be added the depreciation of the rouble and a scenario muddied by the international sanctions in connection with the crisis with Ukraine.

The situation is different for China, where the central bank decided to cut the key interest rate to support the real estate sector and avoid a 'hard landing' of its economy. In this case, the problem stems from the fact that the aggressively expansive monetary policy was proving insufficient to solve the main problems of its economy, which are excess production capacity, slowing demand, the real estate sector and the credit bubble. Lastly, India stands out as the exception among the emerging countries, since it is showing early signs of economic recovery.

4. Risk Management.

Note 45 to the financial statements contains a description of the Group's risk policies and risk management during 2014. Following the recommendations of the "Guide to preparation of the management report for listed companies" published by the CNMV in 2013, we refer to this Note, which deals specifically with:

• Framework Agreement on Risk Policy issued by the Board of Directors.
• Credit Risk: Organisation, policies and management, Evolution during the year, Maximum exposure to credit risk, Policy on refinancing and restructuring, Evolution of customer risk, Control, monitoring and recoveries, NPLs and Repossessed (foreclosed) Assets, Provisions.
• Policies for managing structural risks: structural interest rate, liquidity and market risk.
• Policies for managing market risk.
• Operational Risk.
• Reputational and Compliance Risk.

Also, Note 11 to the financial statements details the main asset and liability accounting hedge transactions undertaken by the Bank.

5. Other Important Information.

5.1. Stock exchange information

Figures per share for the period (€)
Earnings per share	0.31
Dividend per share	0.08
Theoretical book value per share	4.05
Share price at start of year	4.99
Lowest price	5.87
Highest price	7.44
Latest price	6.70
Revaluation over the last quarter (%)	-0.22
Revaluation over the last 12 months (%)	34.37
Stock market ratios
Theoretical price / book value (times)	1.65
PER (price / earnings, times)	21.82
Dividend yield (12 months) (%)	1.50
Number of shareholders	65,735
Number of shares	898,866,154
Number of shares held by non-residents	371,663,143
Average daily trading (number of shares)	8,143,582
Average daily trading (€000s)	54,869
Market capitalisation (€000s)	6,023,302

Note: The stock price prior to the bonus issue has been adjusted to make it comparable with the Ibex 35 and Euro STOXX Banks.

5.2. Dividend policy

Bankinter, S.A., pursues a policy of quarterly payment of dividends. The specific amount of each interim dividend is decided and approved by the Board of Directors in light of the Group's situation, progress and prospects. The definitive appropriation of profits and therefore the distribution of the complementary dividend are approved annually by the General Meeting of Shareholders.

5.3. Ratings

	Long-term	Short-term	Outlook	Date
Moody's	Baa3	P-3	Negative	May 2014
Standard & Poor's	BBB-	A3	Stable	November 2014
DBRS	A (low)	R-1 (low)	Negative	November 2012

6. New products

We continue to be the benchmark institution in the quest for solvency for savings, and in this regard we should highlight the good reception given to the issue of 21 Structured Deposits with 100% guaranteed principal and subscriptions of more than €300 million. For the more sophisticated customers, we would point to the wide range of issues of Structured Notes, 242 to be precise, with a total volume of €1,287.65 million.

In current accounts we continue with the Payroll Account campaign, which has the best conditions on the market, and which has prompted a sharp increase in the number of accounts opened.

The COINC savings portal continued developing a totally digital banking model, including the development of a new mobile interface and active interchange based on e-mails and mobile alerts. Also, as befits an Internet product, work has been done on generating an ecosystem which notably features an agreement with Amazon, whereby all COINC customers "spending" their savings on this e-commerce portal obtain an extra 4%. This has been a significant success for COINC, allowing it to reach 41,000 customers in 2014 with active balances on the portal and €680 million in deposits. -

With the objective of expanding the offering of advisory service to customers Inversión a Medida ('Tailored Investment') was created. This is an advisory service which includes the creation of a personalised multi-asset investment proposal recommended by our Analysis and Advisory team, with an ongoing monitoring of investments, in which the customer is informed of what changes to make and when to make them. The final decision as to whether or not to accept these recommendations always rests with the customer.

As regards Investment Funds, we have incorporated 1,000 new funds from more than 75 international asset managers, completing a list that was already extensive and allowing us to satisfy the needs of the most demanding customers. As for funds managed by Bankinter Gestión de Activos, the asset management subsidiary, we continued the policy of launching guaranteed funds, both fixed income and equities.

Turning to interaction channels with customers, we launched an innovative application for tablets called "Broker Bankinter" which enables customers to operate on the stock exchange and control their investments with a new design adapted to touchscreen technology and with simple, intuitive navigation.

The product offering of Broker Bankinter includes six new kinds of listed products (Turbo Warrants, InLine, Stay, Bonus, Discount and Multi) for customers to use in optimising their various investment strategies.

In September 2014 Bankinter launched the Mobile Virtual Card, a solution allowing customers to use their mobile phones to generate, securely and instantaneously, a single-use credit or debit card with which to make payments in merchant outlets, restaurants or filling stations, or to make purchases from online stores. Bankinter was the first financial institution in the world to launch a mobile payments service with these characteristics.

2014 was a turning point in the mortgage lending market, and in our drive to galvanise mortgage lending to private individuals, after a hiatus of a few years we have once again started offering our customers highly competitive mortgage loans.

As for lending to businesses, we were the first in the market to pass on the improvements in funding volumes and conditions resulting from the ECB's TLTRO long-term financing programmes to businesses. Furthermore, we successfully completed the agreement with the European Investment Fund (EIF), the first such agreement with a Spanish financial institution, for financing innovative projects and businesses, and renewed the agreement for 2015.

The growing internationalisation of Spanish companies has led us to improve and develop the products designed for financing exports; factoring, negotiating letters of credit, etc., and to improve the offering of international guarantees, which are very much in demand, and of cash management instruments.

One important mention should go to the first complete year of the prompt payment functionality of GIP (Gestión Integral de Pagos or 'Integrated Payment Management'), which in its first full year of operation tripled the number of users to more than 7,000 businesses that now handle their payments through Bankinter's GIP system, allowing us to obtain a market share of 9%, well in excess of that in other products.

7. Foreseeable evolution

Looking towards the future, the Group will continue to develop its business model based on creating value through differentiation, focusing on service quality and supported by multi-channelling and ongoing innovation, as well as strict monitoring of asset quality and solvency. With this model, it expects to maintain the positive trend in results and value creation.

8. Subsequent events

No events having a significant effect on these consolidated financial statements have occurred between the end of the reporting period and the date on which these statements were approved.

9. Research and development activities

At the close of financial year 2014, the bank was not engaged in any significant research and development activities.

10. Dependence on patents and licences.

At the close of financial year 2014, the Bankinter Group is not affected by any relevant degree of dependency as regards the issuers of patents, licences, industrial, commercial or financial contracts or new manufacturing processes.

11. Transactions with treasury shares

These transactions are described in Note 22 to the Consolidated Financial Statements and in Note 21 to the Individual Financial Statements.

12. Corporate Governance Report

This is attached as a separate document.