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6-K 1 d87187d6k.htm FORM 6-K Form 6-K

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the month of August 2020

Commission File Number: 001-12568

BBVA Argentina Bank S.A.

(Translation of registrant’s name into English)

111 Córdoba Av, C1054AAA

Buenos Aires, Argentina

(Address of principal executive offices)

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

Form 20-F X Form 40-F

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

Yes No X

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

Yes No X

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes No X

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

Banco BBVA Argentina S.A.

TABLE OF CONTENTS


Item

1.		Banco BBVA Argentina S.A. reports consolidated second quarter earnings for fiscal year 2020.

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Banco BBVA Argentina S.A. announces Second

Quarter 2020 results

Buenos Aires, August 25, 2020 – Banco BBVA Argentina S.A (NYSE; BYMA; MAE: BBAR; LATIBEX: XBBAR) (“BBVA Argentina” or “BBVA” or “the Bank”) announced today its consolidated results for the second quarter (2Q20), ended on June 30, 2020.

As of January 1, 2020, the Bank started to inform its inflation adjusted results pursuant to IAS 29 reporting. To facilitate comparison, figures of comparable quarters of 2019 have been updated according to IAS 29 reporting to reflect the accumulated effect of inflation adjustment for each period up to June 30, 2020.

2Q20 Highlights

●

BBVA Argentina’s inflation adjusted net income in 2Q20 was $2.6 billion, 21.9% lower than the $3.3 billion reported in the first quarter of 2020 (1Q20), and 70.1% lower than the $8.6 billion reported in the second quarter of 2019 (2Q19).

●

In 2Q20, BBVA Argentina posted an inflation adjusted average return on assets (ROA) of 1.9% and an inflation adjusted average return on equity (ROE) of 10.9%.

●

In terms of activity, total consolidated financing to the private sector in 2Q20 totaled $250.4 billion, increasing in real terms 5.4% or $12.8 billion compared to 1Q20, and contracting 5.0% or $13.3 billion compared to 2Q19. In the quarter, growth was driven by Other loans (mainly company loans or “Préstamos a Interés Vencido”) and Discounted instruments, increasing 63.2% and 9.0% respectively. BBVA’s consolidated market share of private sector loans was 8.54% as of 2Q20.

●

Total deposits grew 8.0% in real terms during the quarter, and decreased 8.3% in the year. The Bank’s consolidated market share of private deposits was 6.5% as of 2Q20.

●

As of 2Q20, the non-performing loan ratio (NPL) reached 1.56%, with a 269.38% coverage ratio.

●

The accumulated efficiency ratio in 2Q20 was 47.4%, remaining stable compared to 1Q20’s 47.4%.

●

As of 2Q20, BBVA Argentina reached a regulatory capital ratio of 21.9%, entailing a $53.2 billion or 167.6% excess over minimum regulatory requirement. Tier I ratio was 21.2%. Total liquid assets represented 63.8% of the Bank’s total deposits as of 2Q20.

2Q20 Conference Call

Wednesday August 26, 2020, at 12:00 pm Buenos Aires time – (11:00am EST)

To participate, please dial in:

+ 54-11-3984-5677 (Argentina)

+ 1-844-450-3851 (U.S. Toll free)

+ 1-412-317-6373 (International)

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Web Phone: LINK

Conference ID: BBVA

Webcast & Replay: LINK

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Safe Harbor Statement

This press release contains certain forward-looking statements that reflect the current views and/or expectations of Banco BBVA Argentina and its management with respect to its performance, business and future events. We use words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “seek,” “future,” “should” and other similar expressions to identify forward-looking statements, but they are not the only way we identify such statements. Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this release. Actual results, performance or events may differ materially from those in such statements due to, without limitation, (i) changes in general economic, financial, business, political, legal, social or other conditions in Argentina or elsewhere in Latin America or changes in either developed or emerging markets, (ii) changes in regional, national and international business and economic conditions, including inflation, (iii) changes in interest rates and the cost of deposits, which may, among other things, affect margins, (iv) unanticipated increases in financing or other costs or the inability to obtain additional debt or equity financing on attractive terms, which may limit our ability to fund existing operations and to finance new activities, (v) changes in government regulation, including tax and banking regulations, (vi) changes in the policies of Argentine authorities, (vii) adverse legal or regulatory disputes or proceedings, (viii) competition in banking and financial services, (ix) changes in the financial condition, creditworthiness or solvency of the customers, debtors or counterparties of Banco BBVA Argentina, (x) increase in the allowances for loan losses, (xi) technological changes or an inability to implement new technologies, (xii) changes in consumer spending and saving habits, (xiii) the ability to implement our business strategy and (xiv) fluctuations in the exchange rate of the Peso. The matters discussed herein may also be affected by risks and uncertainties described from time to time in Banco BBVA Argentina’s filings with the U.S. Securities and Exchange Commission (SEC) and Comision Nacional de Valores (CNV). Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as the date of this document. Banco BBVA Argentina is under no obligation and expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Information

This earnings release has been prepared in accordance with the accounting framework established by the Central Bank of Argentina (“BCRA”), based on International Financial Reporting Standards (“I.F.R.S.”) and the resolutions adopted by the International Accounting Standards Board (“I.A.S.B”) and by the Federación Argentina de Consejos Profesionales de Ciencias Económicas (“F.A.C.P.E.”), with the transitory exceptions: (i) the record of a prevision for contingencies referred to uncertain fiscal positions required by the BCRA, (ii) the adjustment in valuation established by the B.C.R.A. applied to the valuation of the remaining investment the Bank keeps of Prisma Medios de Pago S.A. (“Prisma”), and (iii) the temporary exclusion of the application of the IFRS 9 impairment model for non-financial public sector debt instruments.

As of 1Q20, the Bank started to inform its inflation adjusted results pursuant to IAS 29 reporting. To facilitate comparison, figures of comparable quarters of 2019 have been updated according to IAS 29 reporting to reflect the accumulated effect of inflation adjustment for each period up to June 30, 2020.

The information in this press release contains unaudited financial information that consolidates, line item by line item, all of the banking activities of BBVA Argentina, including: BBVA Asset Management Argentina S.A., Consolidar AFJP-undergoing liquidation proceeding, and as of July 1, 2019, PSA Finance Argentina Compañía Financiera S.A. (“PSA”) and Volkswagen Financial Services Compañía Financiera S.A (“VWFS”).

BBVA Consolidar Seguros S.A. is disclosed on a consolidated basis recorded as Investments in associates (reported under the proportional consolidation method), and the corresponding results are reported as “Income from associates”), same as Rombo Compañía Financiera S.A. (“Rombo”), Play Digital S.A. and Interbanking S.A.

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Financial statements of subsidiaries have been elaborated as of the same dates and periods as Banco BBVA Argentina S.A.’s. In the case of consolidated companies PSA and VWFS, financial statements were prepared considering the B.C.R.A. accounting framework for institutions belonging to “Group B”, without considering the model established by the IFRS 9 5.5. “Impairment” section for periods starting as of January 1, 2021.

The information published by the BBVA Group for Argentina is prepared according to IFRS, without considering the temporary exceptions established by BCRA.

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Quarterly results


Income Statement	BBVA ARG consolidated									Chg (%)						Proforma 2Q20⁽⁴⁾
In millions AR$ except EPS and ADS - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY			Proforma 2Q20⁽⁴⁾
Net Interest Income		15,876			17,325			19,157			(8.4	%)		(17.1	%)		15,177
Net Fee Income		3,109			1,977			2,848			57.3	%		9.2	%		3,131
Net income from measurement of financial instruments at fair value through P&L		1,016			1,300			3,100			(21.8	%)		(67.2	%)		1,262
Net loss from write-down of assets at amortized cost and at fair value through OCI		(2,067	)		(134	)		(54	)		n.m			n.m			(2,067	)
Foreign exchange and gold gains		1,494			1,304			1,914			14.6	%		(21.9	%)		1,503
Other operating income		1,142			1,095			6,450			4.3	%		(82.3	%)		1,168
Loan loss allowances		(2,646	)		(1,711	)		(2,594	)		(54.7	%)		(2.0	%)		(2,612	)
Net operating income		17,925			21,156			30,820			(15.3	%)		(41.8	%)		17,561
Personnel benefits		(3,966	)		(4,678	)		(4,756	)		15.2	%		16.6	%		(3,890	)
Adminsitrative expenses		(3,831	)		(3,783	)		(3,548	)		(1.3	%)		(8.0	%)		(3,768	)
Depreciation and amortization		(843	)		(867	)		(696	)		2.8	%		(21.0	%)		(837	)
Other operating expenses		(2,585	)		(3,525	)		(8,944	)		26.6	%		71.1	%		(2,718	)
Operating income		6,700			8,303			12,876			(19.3	%)		(48.0	%)		6,349
Income from associates		188			29			278			n.m			(32.5	%)		258
Income from net monetary position		(2,285	)		(2,765	)		(2,118	)		17.4	%		(7.8	%)		(2,126	)
Net income before income tax		4,603			5,567			11,036			(17.3	%)		(58.3	%)		4,480
Income tax		(2,046	)		(2,293	)		(2,478	)		10.8	%		17.4	%		(1,945	)
Income for the period		2,557			3,274			8,558			(21.9	%)		(70.1	%)		2,535
Number of common shares outstanding (in thousands)		612,710			612,710			612,660			-			0.0	%		612,710
Weighted average number of common shares outstanding (2)(3)		612,710			612,710			612,660			-			0.0	%
Earnings per share (EPS)		4.10			5.30			13.98			(22.7	%)		(70.7	%)		4.10
Earnings per ADS (1)		12.29			15.89			41.93			(22.7	%)		(70.7	%)		12.29

(1) One ADS represents three ordinary shares

(2) In thousands of shares

(3) As of October 9th, 2019, 50.441 shares have been issued related to the merger by absorption with BBVA Francés Valores S.A., totaling 612,710,079 shares. As of the release of these consolidated financial statements, the increase in capital and the merger by absoprtion are pending registry approval by the I.G.J.

(4) Excludes consolidation with VWFS y PSA.

BBVA Argentina 2Q20 net income was $2.6 billion, 21.9% or $717 million lower than 1Q20, and 70.1% or $6.0 billion lower than 2Q19. The quarter-over-quarter (QoQ) decrease is mainly explained by the mandatory lockdown (COVID-19, which has had an impact in the economy, especially on those activities considered by the Government as “non-core business” as of March, 20), and a decrease in the monetary policy rate set by the BCRA, among other regulations conducted by such institution.

As of 2Q20, net operating income was $17.9 billion, decreasing 15.3% or $3.2 billion QoQ and 41.8% or $12.9 billion YoY.

Operating income in 2Q20 was $6.7 billion, decreasing 19.3% or $1.6 billion QoQ, and 48.0% or $6.2 billion YoY. It is important to mention that during 2Q19, dividends from share participation in Prisma ($1.1 billion) were cashed in, reflected in the line Net income from measurement of financial instruments at fair value through P&L.

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Net interest income


Net Interest Income	BBVA ARG consolidated						Chg (%)						Proforma ⁽¹⁾ 2Q20
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY			Proforma ⁽¹⁾ 2Q20
Net Interest Income		15,876		17,325		19,157		(8.4%	)		(17.1%	)		15,177
Interest Income		22,341		25,935		33,805		(13.9%	)		(33.9%	)		21,129
From government securities		5,911		6,584		12,492		(10.2%	)		(52.7%	)		5,911
From private securities		2		2		3		39.6%			(32.8%	)		2
Interest from loans and other financing		14,191		15,883		17,527		(10.7%	)		(19.0%	)		13,054
Financial Sector		236		367		848		(35.7%	)		(72.2%	)		491
Overdrafts		2,942		2,649		2,245		11.1%			31.0%			2,943
Discounted Instruments		1,800		2,679		3,015		(32.8%	)		(40.3%	)		1,800
Mortgage loans		279		334		413		(16.6%	)		(32.5%	)		279
Pledge loans		566		628		138		(9.8%	)		310.7%			89
Consumer Loans		1,998		2,119		2,688		(5.7%	)		(25.6%	)		1,998
Credit Cards		3,563		4,864		6,218		(26.8%	)		(42.7%	)		3,563
Financial leases		101		118		169		(14.7%	)		(40.4%	)		80
Loans for the prefinancing and financing of exports		384		330		893		16.4%			(57.0%	)		378
Other loans		2,322		1,797		900		29.2%			158.0%			1,812
CER/UVA clause adjustment		1,797		2,552		3,379		(29.6%	)		(46.8%	)		1,716
Other interest income		441		915		404		(51.8%	)		9.1%			446
Interest expenses		6,466		8,611		14,648		(24.9%	)		(55.9%	)		5,952
Deposits		5,330		7,103		12,885		(25.0%	)		(58.6%	)		5,280
Checking accounts		168		236		1,209		(28.7%	)		(86.1%	)		168
Savings accounts		48		71		76		(32.2%	)		(36.5%	)		48
Time deposits		5,114		6,796		11,600		(24.8%	)		(55.9%	)		5,063
CER/UVA clause adjustment		249		215		565		15.7%			(55.9%	)		249
Other liabilities from financial transactions		595		993		1,175		(40.1%	)		(49.4%	)		420
Other		291		299		22		(2.6%	)		n.m			4

(1) Excludes consolidation with PSA and VWFS

Net interest income for 2Q20 was $15.9 billion, decreasing 8.4% or $1.5 billion QoQ, and 17.1% or $3.3 billion YoY. The lower interest income is partially offset by lower interest expenses, driven by a decreasing trend in interest rates during the quarter, and an increase in sight deposits.

In 2Q20 interest income totaled $22.3 billion, 13.9% or $3.6 billion lower than 1Q20, and 33.9% or $11.5 billion lower than 2Q19. Quarterly decrease is explained by a decline in rates of interest-earning assets, driven by the credit support measures promoted by the Government to counteract the effects of the pandemic. Additionally, a fall in interest rates fostered by changes in the country’s monetary policy has contributed to the quarterly decrease in interest income.

Income from government securities fell 10.2% or $673 million compared to 1Q20, and 52.7% or $6.6 billion compared to 2Q19. This is explained by a decrease in the monetary policy set by the BCRA (average rate of 38% in 2Q20, 47.4% in 1Q20 and 69.2% in 2Q19¹). This contraction is offset by an increase in the position in BCRA liquidity instruments (LELIQ), derived from new regulation that enables a higher position in LELIQ in line with what is granted in time deposits at minimum rate. 86% of results is explained by public securities at fair value with changes in the Other comprehensive income (OCI) line item, mainly LELIQ.

Interest income from loans and other financing totaled $14.2 billion, decreasing 10.7% or $1.7 billion QoQ. This is mainly explained by the implementation of credit lines to SMEs at 24%, zero rate credit lines and the lower credit card financing rate.

Income from CER/UVA adjustments was 29.6% lower QoQ and 46.8% lower YoY, mainly explained by the deceleration in inflation during the quarter (5.4% in 2Q20 vs. 7.8% in 1Q20²).

¹ Source: BCRA – Simple average rate during the corresponding period.

² Source: Instituto Nacional de Estadística y Censos (INDEC). Consumer Price Index.

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Interest expenses totaled $6.5 billion, 24.9% lower than 1Q20 and 55.9% lower than 2Q19. This is a consequence of the reduction in time deposit and interest-bearing checking account average rates, derived from lower market rates and excess liquidity.

Interest expenses from time deposits explain 79.1% of total interest expenses, decreasing 24.8% QoQ and 56.0% YoY.

Net interest margin (NIM)

As of 2Q20, total net interest margin (NIM) was 14.0%, lower than 1Q20’s 17.8%.


Assets & Liabilities Performance - AR$	BBVA ARG Consolidated
In millions AR$. Rates and spreads in annualized %	2Q20							1Q20
	Average Balance		Interest Earned/Paid		Average Real Rate			Average Balance		Interest Earned/Paid		Average Real Rate
Total interest-earning assets		331,932		21,649		26.2	%		278,515		25,208		36.3	%
Government securities		82,693		6,371		30.9	%		82,479		7,381		35.9	%
Loans to customers/financial institutions		218,435		15,265		28.0	%		193,552		17,827		36.9	%
Other assets		30,804		13		0.2	%		2,484		0		0.0	%
Total non interest-earning assets		85,164		-		0.0	%		103,106		-		0.0	%
Total Assets		417,095		21,649					381,621		25,208
Total interest-bearing liabilities		177,021		6,406		14.5	%		154,818		8,448		21.9	%
Savings accounts		74,592		215		1.2	%		60,729		305		2.0	%
Time deposits		88,153		5,463		24.9	%		79,402		7,149		36.1	%
Debt securities issued		6,246		593		38.1	%		7,778		963		49.7	%
Other liabilities		8,031		135		6.7	%		6,909		30		1.8	%
Total non-interest-bearing liabilities		248,373		-		0.0	%		232,986		-		0.0	%
Total liabilities and equity		425,394		6,406		6.0	%		387,804		8,448		8.7	%

NIM - AR$						11.6	%						14.4	%


Assets & Liabilities Performance - Foreign Currency	BBVA ARG Consolidated
In millions AR$. Rates and spreads in annualized %	2Q20							1Q20
	Average Balance		Interest Earned/ Paid		Average Real Rate			Average Balance		Interest Earned/ Paid		Average Real Rate
Total interest-earning assets		49,699		693		5.6	%		53,307		727		5.5	%
Government securities		4,023		104		10.4	%		7,366		147		8.0	%
Loans to customers/financial institutions		41,321		588		5.7	%		44,438		580		5.2	%
Other assets		4,355		1		0.1	%		1,503		1		0.2	%
Total non interest-earning assets		93,771		-		0.0	%		89,955		-		0.0	%
Total Assets		143,470		693					143,262		727
Total interest-bearing liabilities		96,633		59		0.2	%		100,201		94		0.4	%
Savings accounts		77,621		1		0.0	%		80,120		2		0.0	%
Time deposits		17,632		50		1.1	%		18,945		62		1.3	%
Other liabilities		1,380		8		2.4	%		1,137		30		10.7	%
Total non-interest-bearing liabilities		38,538		-		0.0	%		36,878		-		0.0	%
Total liabilities and equity		135,171		59		0.2	%		137,080		94		0.3	%

NIM - Foreign currency						5.3	%						5.1	%

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Net fee income


Net Fee Income	BBVA ARG consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Net Fee Income		3,109		1,977		2,848		57.3	%		9.2	%
Fee Income		6,104		5,691		6,408		7.3	%		(4.7	%)
Linked to liabilities		2,404		3,035		3,326		(20.8	%)		(27.7	%)
From credit cards		2,832		1,897		2,366		49.2	%		19.7	%
Linked to loans		254		210		70		20.7	%		264.3	%
From insurance		304		292		315		4.0	%		(3.6	%)
From foreign trade and foreign currency transactions		243		220		298		10.6	%		(18.4	%)
Other fee income		68		37		33		84.4	%		109.0	%
Fee expenses		2,996		3,715		3,560		(19.3	%)		(15.8	%)

In 2Q20, net fee income grew 57.3% or $1.1 billion compared to 1Q20, and 9.2% or $261 million compared to 2Q19.

Fee income totaled $6.1 billion, 7.3% higher QoQ as a result of fees from credit card consumption received during the period, which more than offset the fall in activity due to the effects of the pandemic.

Fee expenses fell 19.3% compared to 1Q20 and 15.8% compared to 2Q19 respectively. This is mainly explained by lower expenses related to credit card benefits as a result of a lower activity due to the extension of the mandatory lockdown on COVID-19, and lower investment in client acquisition, also derived from the lower activity.

Net income from measurement of financial instruments at fair value and foreign exchange and gold gains/losses


Net Income from financial instruments at fair value (FV) through P&L	BBVA ARG Consolidated									Chg (%)
In millions AR$ - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY
Net Income from financial instruments at FV through P&L		1,016			1,299			3,100			(21.8	%)	(67.2%)
Income from government securities		1,077			980			1,120			9.8	%	(3.9%)
Income from private securities		(100	)		36			1,198			(376.0	%)	(108.3%)
Interest rate swaps		21			24			(313	)		(12.0	%)	106.8%
Gains from foreign currency forward transactions		2			243			1,077			(99.4	%)	(99.9%)
Income from debt and equity instruments		16			18			18			(6.3	%)	(11.1%)
Other		-			(2	)		-			100.0	%	N/A

In 2Q20, net income from financial instruments at Fair Value (FV) through P&L was $1.0 billion, decreasing 21.8% or $283 million QoQ. This is explained by the lower volume in forward contract transactions, as a consequence of a lower activity driven by regulations and the broad spread in foreign exchange prices. In the year, the contraction was 67.2% or $2.1 billion, mainly explained by the cashing in of dividends received from share participation in Prisma in 2Q19 ($1.1 billion). Excluding this result, the decrease versus 2Q19 would have been 49.6% or $1.0 billion.

Income from private securities contracted 376.0% or $136 million QoQ, by cause of a higher negative impact of inflation adjustment compared to the variation in market prices.

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Differences in quoted prices of gold and foreign currency	BBVA ARG Consolidated							Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19			QoQ			YoY
Foreign exchange and gold gains/(losses) (1)		1,495		1,303		1,914			14.7%			(21.9%	)
From foreign exchange position		295		307		(469	)		(3.7%	)		163.0%
Income from purchase-sale of foreign currency		1,200		997		2,382			20.3%			(49.6%	)
Net income from financial instruments at FV through P&L (2)		2		243		1,077			(99.4%	)		(99.9%	)
Income from foreign currency forward transactions		2		243		1,077			(99.4%	)		(99.9%	)
Total differences in quoted prices of gold and foreign currency (1) + (2)		1,496		1,547		2,990			(3.2%	)		(50.0%	)

In 2Q20, the difference in quoted prices of gold and foreign currency showed profit for $1.5 billion, falling 3.2% or $50 million compared with 1Q20, due to lower activity driven by changes in foreign exchange market regulation, partially offset by an increase in results from purchase and sale of foregin currency.

Other operating income


Other operating income	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Operating Income		1,143		1,094		6,449		4.4%			(82.3%	)
Rental of safe deposit boxes ⁽¹⁾		258		219		210		17.9%			22.6%
Adjustments and interest on miscellaneous receivables ⁽¹⁾		312		263		389		18.6%			(19.9%	)
Punitive interest ⁽¹⁾		16		60		55		(73.3%	)		(70.6%	)
Loans recovered		165		171		175		(3.6%	)		(5.9%	)
Fee income from credit and debit cards ⁽¹⁾		41		78		233		(48.2%	)		(82.6%	)
Other Operating Income⁽²⁾		351		303		5,387		15.9%			(93.5%	)

(1) Included in the efficiency ratio calculation

(2) Includes some of the concepts used in the efficiency ratio calculation

In 2Q20 Other operating income totaled $1.1 billion, increasing 4.4% or $48 million QoQ explained by increases in rental of safe deposit boxes, and decreasing 82.3% or $5.3 billion compared to 2Q19.

It is important to highlight that during 2Q19, an income was reported in the Other operating income line, from the declaratory action filed related to inflation adjustments in the Income Tax Return for fiscal year 2018. This was offset by the provision for the same amount reported in Other operating expenses.

Operating expenses

Personnel benefits and Administrative expenses

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Personnel Benefits and Adminsitrative Expenses	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Total Personnel Benefits and Adminsitrative Expenses		7,797		8,461		8,305		(7.8%	)		(6.1%	)
Personnel Benefits ⁽¹⁾		3,966		4,678		4,756		(15.2%	)		(16.6%	)
Administrative expenses ⁽¹⁾		3,831		3,783		3,549		1.3%			8.0%
Travel expenses		15		31		42		(50.2%	)		(63.8%	)
Administrative expenses		375		363		317		3.4%			18.1%
Security services		210		116		128		81.5%			64.0%
Fees to Bank Directors and Supervisory Committee		6		21		4		(69.9%	)		49.6%
Other fees		153		253		220		(39.7%	)		(30.7%	)
Insurance		37		45		39		(18.3%	)		(6.2%	)
Rent		430		332		236		29.7%			82.4%
Stationery and supplies		19		20		16		(7.2%	)		13.3%
Electricity and communications		202		235		196		(13.9%	)		3.2%
Advertising		127		189		161		(32.6%	)		(21.1%	)
Taxes		942		918		932		2.6%			1.0%
Maintenance costs		480		451		375		6.5%			28.0%
Armored transportation services		319		292		482		9.4%			(33.8%	)
Other administrative expenses		516		519		399		(0.6%	)		29.3%

Headcount*		6,287		6337		6325		(50	)		(38	)
BBVA (Bank)		6,186		6,233		6,223		(47	)		(37	)
Associates ^(2)*		101		104		102		(3	)		(1	)
Total branches		247		246		252		1			(5	)

Efficiency Ratio		47.4%		47.4%		36.1%		1 bps			1,130 bps
Accumulated Efficiency Ratio		47.4%		47.4%		38.7%		1 bps			869 bps

(1) Concept included in the efficiency ratio calculation

(2) Includes BBVA Asset Management Argentina S.A. and PSA & VWFS as of 3Q19

*corresponds to total effective employees, net of temporary contract employees

During 2Q20, personnel benefits and administration expenses totaled $7.8 billion, decreasing 7.8% or $664 million QoQ, and 6.1% YoY. This is mainly explained by the efficiency plan put into effect as of 4Q19.

Personnel benefits contracted 15.2% or $712 million compared to 1Q20, and 16.6% or $790 million compared to 2Q19. As of the end of June there were no new rearrangements with labor unions regarding salary increases. On July 16, 2020, an arrangement with the union was agreed for a 26% increase in four instalments (7% in January, 6% in April, 7% in July and 6% in October), with a review clause in November 2020.

In 2Q20, administrative expenses increased 1.3% QoQ and 8.0% YoY. This increase is mainly due to adjustments applied to continue operating during the pandemic. These adjustments include cleaning and disinfection costs, purchase of protection equipment (gloves, face masks, etc.), surveillance and software costs, all of which were partially offset by the contraction in administrative services and advertising expenses.

The accumulated efficiency ratio as of 2Q20 was 47.4%, remaining stable compared to the 47.4% reported in 1Q20, and higher than the 36.1% reported in 2Q19. This is a result of a deeper percentage fall in the denominator (income), than the fall recorded in the numerator (expenses).

Other operating expenses

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Other Operating Expenses	BBVA ARG Consolidated							Chg (%)
In millions AR$ - Inflation adjusted	2Q20			1Q20		2Q19		QoQ			YoY
Other Operating Expenses		2,585			3,525		8,944		(26.7%	)		(71.1%	)
Turnover tax		1,663			1,836		2,115		(9.4%	)		(21.4%	)
Inicial loss of loans below market rate		93			184		530		(49.5%	)		(82.5%	)
Contribution to the Deposit Guarantee Fund (SEDESA)		143			131		180		9.2%			(20.7%	)
Interest on liabilities from financial lease		76			81		93		(5.4%	)		(18.3%	)
Other allowances		(82	)		741		5,194		(111.0%	)		(101.6%	)
Other operating expenses		692			552		831		25.4%			(16.7%	)

In 2Q20, other operating expenses decreased 26.7% or $939 million QoQ, and 71.1% or $6.4 billion YoY.

The QoQ decrease is mainly explained by the decline in Other allowances, due to unused checking accounts’ overdraft lines of credit.

As mentioned previously, in 2Q19 a provision for contingent liabilities was reported, as requested by the BCRA, corresponding to the declaratory action filed by the Bank related to inflation adjustments in the Income Tax Return presented for fiscal year 2018

Income from associates

This line reflects the results from non-consolidated associate companies. During 2Q20, a profit of $188 million has been reported, mainly due to the participation in BBVA Consolidar Seguros S.A., Rombo Compañía Financiera S.A., and Interbanking S.A.

Income tax

Income tax charges decreased $243 million compared to 2Q19 and $432 million compared to 1Q20, reporting a loss of $2.3 billion and an effective rate of 44%. The increment in such rate compared to the regulatory 30% is caused by the difference between BCRA accounting regulation and tax regulations related to inflation adjustments, resulting in different taxable incomes.

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Balance sheet and activity

Loans and other financing


Loans and other financing	BBVA ARG Consolidated									Chg (%)						Proforma ⁽²⁾
In millions AR$ - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY			2Q20
To the public sector		-			13			-			(100.0%	)		N/A			-
To the financial sector		3,572			5,388			10,919			(33.7%	)		(67.3%	)		6,771
Non-financial private sector and residents abroad		250,424			237,591			263,727			5.4%			(5.0%	)		236,360
Non-financial private sector and residents abroad - AR$		215,127			193,686			165,192			11.1%			30.2%			201,063
Overdrafts		31,127			31,091			13,675			0.1%			127.6%			31,127
Discounted instruments		23,917			20,604			20,463			16.1%			16.9%			23,917
Mortgage loans		15,491			15,734			17,197			(1.5%	)		(9.9%	)		15,491
Pledge loans		7,645			9,011			2,231			(15.2%	)		242.7%			1,421
Consumer loans		23,789			25,172			34,851			(5.5%	)		(31.7%	)		23,811
Credit cards		75,719			73,113			64,739			3.6%			17.0%			75,761
Receivables from financial leases		1,318			1,522			2,629			(13.4%	)		(49.9%	)		1,087
Other loans ⁽¹⁾		36,120			17,438			9,407			107.1%			284.0%			28,447
Non-financial private sector and residents abroad - Foreign Currency		35,297			43,905			98,536			(19.6%	)		(64.2%	)		35,297
Overdrafts		2			1			15			100.9%			(84.2%	)		2
Discounted instruments		17			1,357			6,348			(98.7%	)		(99.7%	)		17
Mortgage loans		191			184			-			3.7%			N/A			191
Credit cards		1,294			1,173			3,982			10.4%			(67.5%	)		1,294
Receivables from financial leases		236			295			320			(20.2%	)		(26.3%	)		236
Loans for the prefinancing and financing of exports		21,808			29,005			74,047			(24.8%	)		(70.5%	)		21,808
Other loans ⁽¹⁾		11,748			11,890			13,825			(1.2%	)		(15.0%	)		11,748

% of total loans to Private sector in AR$		85.9%			81.5%			62.6%			438 bps			2,327 bps			85.1%
% of total loans to Private sector in Foreign Currency		14.1%			18.5%			37.4%			(438)bps			(2,327)bps			14.9%

Total loans and other financing		253,996			242,991			274,646			4.5%			(7.5%	)		243,131
Allowances		(10,771	)		(12,763	)		(8,143	)		15.6%			(32.3%	)		(10,567	)
Total net loans and other financing		243,225			230,228			266,503			5.6%			(8.7%	)		232,564

(1) Includes IFRS adjustment

(2) Excludes consolidation with VWFS & PSA.

Private loans totaled $250.4 billion, growing 5.4% or $12.8 billion QoQ, and decreasing 5.0% or $13.3 billion YoY.

Loans to the financial sector fell 33.7% QoQ, mainly because of the reduction in call money transactions of less than 30 day duration with subsidiaries.

Loans to the private sector in pesos grew 11.1% in 2Q20, and 30.2% in the year. Loans to the private sector denominated in foreign currency fell 19.6% QoQ and 64.2% YoY, mainly driven by the prudential reduction in USD-denominated loans after August 2019 turmoil, and by the increase in demand for credit in pesos. These loans, measured in U.S. dollars, fell 26.4% and 78.4% QoQ and YoY respectively. The increase in the currency exchange rate versus the U.S. dollar was 9.3% QoQ and 66.0% YoY.


Loans and other financing	BBVA ARG Consolidated						Chg (%)						Proforma ⁽²⁾
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY			2Q20
Non-financial private sector and residents abroad - Retail		124,130		124,387		122,999		(0.2%	)		0.9%			117,970
Mortgage loans		15,682		15,918		17,197		(1.5%	)		(8.8%	)		15,682
Pledge loans		7,645		9,011		2,231		(15.2%	)		242.7%			1,421
Consumer loans		23,789		25,172		34,851		(5.5%	)		(31.7%	)		23,811
Credit cards		77,013		74,285		68,721		3.7%			12.1%			77,055
Non-financial private sector and residents abroad - Commercial		126,295		113,204		140,728		11.6%			(10.3%	)		118,391
Overdrafts		31,129		31,092		13,690		0.1%			127.4%			31,129
Discounted instruments		23,935		21,961		26,811		9.0%			(10.7%	)		23,935
Receivables from financial leases		1,554		1,817		2,949		(14.5%	)		(47.3%	)		1,323
Loans for the prefinancing and financing of exports		21,808		29,005		74,047		(24.8%	)		(70.5%	)		21,808
Other loans ⁽¹⁾		47,868		29,328		23,232		63.2%			106.0%			40,196

% of total loans to Retail sector		49.6%		52.4%		46.6%		(279)bps			293 bps			49.9%
% of total loans to Commercial sector		50.4%		47.6%		53.4%		279 bps			(293)bps			50.1%

(1) Includes IFRS adjustment

(2) Excludes consolidation with VWFS & PSA.

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Considering retail loans (mortgage, pledge, consumer and credit card loans), these have decreased 0.2% QoQ and grown 0.9% YoY. In the quarter, the deepest declines are reflected in pledge loans and consumer loans (15.2% and 5.5% respectively), offset by the increase in credit card consumption boosted by zero rate credit lines and Ahora 12 programs.

Commercial loans (including overdrafts, discounted instruments, receivables from financial leases, loans for the prefinancing and financing of exports, and other loans) grew 11.6% QoQ and fell 10.3% YoY. The quarterly increase is mainly explained by a strong growth in Other loans (especially company loans or “Préstamos a Interés Vencido“) which increased 63.2% or $18.5 billion, followed by discounted instruments that grew 9.0% or $2.0 billion QoQ. This growth is partially offset by the 24.8% fall in Loans for the prefinancing and financing of exports, and a 14.5% fall in Receivables from financial leases.

Market share - Private sector Loans

BBVA ARG

Chg (bps)

In%

2Q20

1Q20

2Q19

QoQ

YoY

Private sector loans - Bank

7.50%

7.64%

0 bps

(14)bps

Private sector loans - Consolidated*

8.54%

8.35%

8.51%

19 bps

3 bps

Based on daily BCRA information. Capital balance as of the last day of each quarter.

* Consolidates PSA, VWFS & Rombo

Asset quality


Asset Quality	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Commercial non-performing portfolio (1)		1,331		4,410		3,685		(69.8%	)		(63.9%	)
Total commercial portfolio		105,430		108,211		139,332		(2.6%	)		(24.3%	)
Commercial non-performing portfolio / Total commercial portfolio		1.26%		4.08%		2.64%		(281)bps			(138)bps
Retail non-performing portfolio (1)		2,667		2,418		3,689		10.3%			(27.7%	)
Total retail portfolio		151,492		137,407		137,514		10.3%			10.2%
Retail non-performing portfolio / Total retail portfolio		1.76%		1.76%		2.68%		0 bps			(92)bps
Total non-performing portfolio (1)		3,998		6,828		7,374		(41.4%	)		(45.8%	)
Total portfolio		256,922		245,618		276,845		4.6%			(7.2%	)
Total non-performing portfolio / Total portfolio		1.56%		2.78%		2.66%		(122)bps			(111)bps
Allowances		10,771		12,763		8,143		(15.6%	)		32.3%
Allowances /Total non-performing portfolio		269.38%		186.91%		110.43%		8,246 bps			15,895 bps
Write offs		4,926		885		2,121		456.5%			132.2%
Write offs / Total portfolio		1.92%		0.36%		0.77%		156 bps			115 bps
Cost of Risk (CoR)		3.99%		2.58%		3.38%		142 bps			61 bps

(1) Non-performing loans include: all loans to borrowers classified as “Deficient Servicing (Stage 3)”, “High Insolvency Risk (Stage 4)”, “Irrecoverable” and/or “Irrecoverable for Technical Decision” (Stage 5) according to BCRA debtor classification system

In 2Q20, asset quality ratio or NPL (total non-performing portfolio / total portfolio) was 1.56%. This ratio was positively affected by the temporary flexibility in BCRA regulation regarding debtor classification during the COVID-19 pandemic, which extends grade periods in 60 days before a loan is classified as non-performing, and suspends the mandatory reclassification of clients that have an irregular performance with other institutions but a regular performance with the Bank. The NPL ratio was also benefited by the Molinos Cañuelas debt write-off.

The coverage ratio (allowances / total non-performing portfolio) increased to 269.38% in 2Q20, from 186.91% in 1Q20. This is explained by a decrease in non-performing loans, partly due to the Molinos Cañuelas write-off (which is greater than the increase in allowances as a consequence of the implementation of impairment models), and the change in BCRA regulation regarding debtor classification.

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Analysis for the allowance of loan losses	BBVA ARG
Analysis for the allowance of loan losses	Balance at					Lifetime ECL*						Monetary result			Balance at
In millions AR$	12/31/2019		12-month ECL*			Financial assets with significant increase in credit risk			Credit impaired financial assets			generated by allowances			06/30/2020
Other financial assets		257		4			-			11			(33	)		238
Loans and other financing		12,741		233			1,260			(2,080	)		(1,613	)		10,541
Other financial institutions		145		(28	)		(60	)		(1	)		(14	)		42
Non-financial private sector and residents abroad		12,596		261			1,320			(2,079	)		(1,598	)		10,500
Overdrafts		738		468			1,286			72			(169	)		2,395
Discounted instruments		1,040		284			(432	)		(83	)		(85	)		725
Mortgage loans		161		(55	)		(19	)		163			(25	)		224
Pledge loans		35		(7	)		(10	)		14			(4	)		28
Consumer loans		1,537		(279	)		(204	)		87			(170	)		971
Credit cards		3,851		(737	)		(14	)		(106	)		(415	)		2,579
Receivables from financial leases		142		(24	)		(19	)		(34	)		(14	)		50
Other financial assets		5,091		611			732			(2,192	)		(716	)		3,527
Other debt securities		1		(1	)		-			-			(0	)		0
Eventual commitments		1,029		131			(27	)		(17	)		(134	)		982
Total allowances		14,028		367			1,233			(2,087	)		(1,780	)		11,761

* ECL: Expected credit loss

Note: to be consistent with Financial Statements, it must be recorded from the beginning of the year instead of the quarter

Allowances for the Bank in 2Q20 reflect expected losses driven by the adoption of the IFRS 9 standards as of January 1, 2020, except for debt instruments issued by the nonfinancial government sector which were temporarily excluded from the scope of such standard.

The financial statements of consolidated subsidiaries PSA and VWFS were prepared considering the financial reporting framework set forth by the BCRA for Group “B” financial institutions, without considering the model established in paragraph 5.5. “Impairment” of IFRS 9 for fiscal years commencing on and after January 1, 2021.

Public sector exposure


Net Public Debt Exposure	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Treasury and Government securities		17,789		19,291		28,007		(7.8%	)		(36.5%	)
Treasury and National Government		17,789		19,237		27,930		(7.5%	)		(36.3%	)
National Treasury Public Debt in pesos		9,855		11,818		11,240		(16.6%	)		(12.3%	)
National Treasury Public Debt in dollars		-		137		3,165		(100.0%	)		(100.0%	)
National Treasury Public Debt USD-Linked		7,933		7,282		13,525		8.9%			(41.3%	)
Provinces		-		53		77		(100.0%	)		(100.0%	)
Loans to the Public Sector		-		1		-		(100.0%	)		N/A
Repo		-		-		8,343		N/A			N/A
National Treasury - AR$		-		-		376		N/A			(100.0%	)
National Treasury - Foreign Currency		-		-		7,968		N/A			(100.0%	)
AR$ Subtotal		9,855		11,871		11,692		(17.0%	)		(15.7%	)
USD Subtotal*		7,933		7,420		24,658		6.9%			(67.8%	)
Total Public Debt Exposure		17,789		19,292		36,350		(7.8%	)		(51.1%	)

B.C.R.A. Exposure		111,583		62,563		81,380		78.4%			37.1%
Instruments		77,316		59,190		81,380		30.6%			(5.0%	)
LELIQs		77,316		59,190		81,380		30.6%			(5.0%	)
Loans to the B.C.R.A.		-		12		-		(100.0%	)		N/A
Repo		34,267		3,374		-		n.m			N/A
B.C.R.A. - AR$		34,267		3,374		-		n.m			N/A

%Public sector exposure (Excl. B.C.R.A.) / Total assets		3.3%		3.6%		6.3%		(29)pbs			(303)pbs

*Includes USD-linked Treasury public debt in AR$

Public sector exposure (excluding BCRA) totaled $17.8 billion, decreasing 7.8% or $1.5 billion QoQ, and 51.1% or $18.6 billion YoY.

It is important to mention that on May 7 and May 15, 2020, the National Treasury offered two voluntary swap on U.S. dollar denominated notes (LETEs), in which the Bank swapped its total position on these securities in exchange of a bundle of

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sovereign bonds in pesos adjusted by inflation (BONCER) maturing in 2022, 2023 and 2024.

Short-term liquidity is allocated in BCRA instruments, which grew 30.6% or $18.1 billion compared to 1Q20, and decreased 5.0% or $4.1 billion compared to 2Q19.

Exposure to the public sector (excluding BCRA) represents 3.3% of total assets.

After 2Q20 quarter end, on July 17, 2020, the Bank participated in the voluntary swap offered by the National Treasury, and swapped 100% of its remaining position in U.S. dollar linked notes (LELINK) in exchange of a bundle of sovereign bonds in pesos adjusted by inflation (BONCER) maturing in 2023 and 2024.

Deposits


Deposits	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Total deposits		373,260		345,587		407,151		8.0%			(8.3%	)
Non-financial Public Sector		5,463		3,660		5,190		49.3%			5.3%
Financial Sector		300		302		423		(0.9%	)		(29.2%	)
Non-financial private sector and residents abroad		367,497		341,624		401,538		7.6%			(8.5%	)
Non-financial private sector and residents abroad - AR$		253,872		221,612		211,417		14.6%			20.1%
Checking accounts		75,182		66,633		43,819		12.8%			71.6%
Savings accounts		78,818		71,658		55,991		10.0%			40.8%
Time deposits		94,362		75,056		107,854		25.7%			(12.5%	)
Investment accounts		61		15		-		316.6%			N/A
Other		5,449		8,251		3,753		(34.0%	)		45.2%
Non-financial private sector and res. abroad - Foreign Currency		113,625		120,012		190,122		(5.3%	)		(40.2%	)
Checking accounts		17		36		23		(51.7%	)		(23.9%	)
Savings accounts		93,730		99,665		162,802		(6.0%	)		(42.4%	)
Time deposits		17,321		16,847		24,210		2.8%			(28.5%	)
Other		2,557		3,464		3,087		(26.2%	)		(17.2%	)

% of total portfolio in the private sector in AR$		69.1%		64.9%		52.7%		421 bps			1,643 bps
% of total portfolio in the private sector in Foregin Currency		30.9%		35.1%		47.3%		(421)bps			(1,643)bps

During 2Q20, total deposits were $373.3 billion, recording an increase of 8.0% or $27.7 billion QoQ, and an 8.3% or $33.9 billion contraction YoY.

Private sector deposits in 2Q20 were $367.5 billion, increasing 7.6% or $25.9 billion QoQ, and decreasing 8.5% or $34.0 billion YoY.

Private non-financial sector deposits in pesos totaled $253.9 billion, growing 14.6% or $32.3 billion QoQ, and 20.1% or $42.5 billion YoY. This is mainly explained by the strong growth in time deposits, savings accounts and checking accounts, which offsets the quarterly fall in interest-bearing checking accounts (included in savings accounts).

Private non-financial sector deposits in foreign currency expressed in pesos fell 5.3% or $6.4 billion QoQ and 40.2% or $76.5 billion YoY. Measured in U.S. dollars, these deposits fell 13.4% QoQ and 64.0% YoY. During 2Q20 U.S. dollar deposit withdrawal continued, but at a much lower pace than what was observed during the last months of 2019.

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Deposits	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Non-financial private sector and residents abroad		367,497		341,624		401,538		7.6%			(8.5%	)
Sight deposits		255,753		249,707		269,474		2.4%			(5.1%	)
Checking accounts		75,199		66,668		43,841		12.8%			71.5%
Savings accounts		172,548		171,323		218,793		0.7%			(21.1%	)
Other		8,006		11,715		6,840		(31.7%	)		17.0%
Time deposits		111,744		91,918		132,064		21.6%			(15.4%	)
Time deposits		111,683		91,903		132,064		21.5%			(15.4%	)
Investment accounts		61		15		-		316.6%			N/A

% of sight deposits over total deposits		69.6%		73.1%		67.1%		(350)pbs			248 pbs
% of time deposits over total deposits		30.4%		26.9%		32.9%		350 pbs			(248)pbs
As of 2Q20, the Bank’s transactional deposits (checking accounts and savings accounts) represented 66.4% of total non-financial private deposits, totaling $247.7 billion.
Market Share - Private sector Deposits	BBVA ARG						Chg (bps)
In %	2Q20		1Q20		2Q19		QoQ			YoY
Private sector Deposits - Consolidated*		6.50%		6.80%		7.35%		(30)bps			(85)bps
Based on daily BCRA information. Capital balance as of the last day of each quarter. * Consolidates PSA, VWFS & Rombo Other sources of funds
Other sources of funds	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Other sources of funds		102,378		103,450		95,004		(1.0%	)		7.8%
Central Bank		32		246		13		(87.0%	)		146.2%
Banks and international organizations		-		300		4,687		N/A			N/A
Financing received from local financial institutions		5,066		3,275		-		54.7%			N/A
Corporate bonds		4,203		7,902		6,180		(46.8%	)		(32.0%	)
Equity		93,077		91,727		84,123		1.5%			10.6%

In 2Q20, other sources of funds totaled $102.4 billion, falling 1.0% or $1.1 billion QoQ, and growing 7.8% or $7.4 billion YoY.

In 2Q20, the Banks and International Organizations line item is null, explained by the cancellation of the lines with correspondent banks.

The 1.5% or $1.4 billion increase in Equity is explained by the 2Q20 results.

4Q19 equity evolution can be observed in the table below, going from historical values to current values through the implementation of IAS 29 rule.


Equity
In millions AR$ - Inflation adjusted	4Q19
Equity before IAS 29 application		65,317
Total impact of IAS 29 application (1)		14,651
Equity in terms of 12/31/2019 units		77,934
Adjustment from reexpression of equity at current units 06/30/2020 (2)		10,594
Equity in terms of 06/30/2020 units		88,528
Total recognized in Retained Earnings (1)+(2)		25,245

Liquid assets

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Total Liquid Assets	BBVA ARG consolidated						Chg (%)
In millions $	1Q20		4Q19		1Q19		QoQ			YoY
Total liquid assets		237,938		235,362		246,979		1.1%			(3.7%	)
Cash and deposits in banks		112,525		154,393		129,846		(27.1%	)		(13.3%	)
Debt securities at fair value through profit or loss		9,644		9,439		9,265		2.2%			4.1%
Government securities		0		54		748		(99.6%	)		(100.0%	)
Liquidity bills of B. C. R. A.		9,644		9,385		8,518		2.8%			13.2%
Net REPO transactions		34,267		3,374		8,458		n.m			305.2%
Other debt securities		81,502		68,156		99,410		19.6%			(18.0%	)
Government securities		13,829		18,352		26,547		(24.6%	)		(47.9%	)
Liquidity bills of B. C. R. A.		67,672		49,804		72,863		35.9%			(7.1%	)

Liquid assets / Total Deposits		63.7%		68.1%		60.7%		(436)pbs			309 pbs

In 2Q20, liquid assets were $237.9 billion, increasing 1.1% or $2.6 billion compared to 1Q20, and falling 3.7% or $9.0 billion compared to 2Q19.

During the quarter, growth in LELIQ stands out with a 30.6% or $18.1 billion increase, while Cash and deposits in banks decreased 27.1% or $41.9 billion.

In 2Q20, the liquidity ratio (liquid assets / total deposits) reached 63.8%. Liquidity ratio in foreign currency reached 78.7%.

Solvency


Minimum capital requirement	BBVA ARG Consolidated									Chg (%)
In millions AR$ - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY
Minimum capital requirement		31,719			30,789			34,854			3.0%			(9.0%	)
Credit risk		23,437			22,830			27,727			2.7%			(15.5%	)
Market risk		574			528			250			8.7%			129.6%
Operational risk		7,708			7,431			6,877			3.7%			12.1%

Integrated Capital - RPC (1)*		84,893			82,004			82,511			3.5%			2.9%
Ordinary Capital Level 1 ( COn1)		95,947			95,754			85,032			0.2%			12.8%
Deductible items COn1		(13,541	)		(16,079	)		(5,355	)		(15.8%	)		152.9%
Additional Capital Level 2 (COn2)		2,487			2,329			2,834			6.8%			(12.2%	)

Excess Capital
Integration excess		53,174			51,214			47,657			3.8%			11.6%
Excess as % of minimum capital requirement		167.6%			166.3%			136.73%			130 bps			3,091 bps

Risk-weighted assets (RWA, according to B.C.R.A. regulation) (2)		387,958			376,556			425,585			3.0%			(8.8%	)

Regulatory Capital Ratio (1)/(2)		21.9%			21.8%			19.4%			10 bps			249 bps
TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)		21.2%			21.2%			18.7%			8 bps			252 bps

* RPC includes 100% of quarterly results

BBVA Argentina continues to show strong solvency indicators on 2Q20. Capital ratio reached 21.9%. Tier 1 ratio was 21.2% and capital excess over regulatory requirement was $53.2 billion.

These ratios improved in spite of BCRA regulation: Communication “A” 6940, regarding exposure to individuals and companies purchasing touristic services abroad in instalments, and Communication “A” 7018, regarding clients with agricultural activity that stockpile more than 5% of their annual harvest.

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Other Events

Relevant Events

●

As of June 25, 2020, S&P Global Ratings downgraded the rating on the Global Program of Corporate Bonds of BBVA Argentina from raBB+ to raBBB-, with a negative outlook. It also downgraded the issuer short term credit rating from raA-2 to raA-3, and the long term credit rating from raBBB+ to raBBB- with a negative outlook. This is in line with the assessments on the transfer and convertibility risks (T&C) for the Argentine Republic, and the incorporation of its impact in the Bank’s credit ratings and in relation to other Argentine issuers.

Corporate Bond payments during 2Q20

●

As of May 8, 2020, the Bank completed quarterly coupon payments on corporate bond Class 25 for $34.5 million.

●

As of May 28, 2020, the Bank completed quarterly coupon payments on corporate bond Class 27 for $84.2 million.

●

As of June 12, 2020, the Bank completed quarterly coupon and capital payments on corporate bond Class 28 for $140.3 million and $1.98 billion respectively.

●

As of June 29, 2020, the Bank completed quarterly coupon payments for corporate bond Class 24 for $39.4 million.

Digital Transformation

Digitalization continued to accelerate during the second quarter of 2020. Active digital clients reached 1.9 million with a 69% penetration over total active clients (2.7 million), and active mobile clients were 1.5 million, representing a 57% penetration. Also, digital and mobile channel transactions for the Bank have increased 43% QoQ. On 2Q20, retail digital sales measured in units reached 75.7% of total sales and represent 41.9% of the Banks total sales measured in monetary value.

COVID 19 – update

Financing (including regulatory changes)

Retail

●

Penalties on unpaid checking account charges, and closure and disabling of accounts, were suspended until September 30, 2020.

●

Allowances on fees for cash withdrawals from ATMs from the Bank and other banks’, are extended until September 30, 2020.

●

Loan maturities until September 30, 2020 are included for the deferral on unpaid instalments on mortgage, pledge and consumer loans.

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A new credit line called “Zero rate Culture Credits” has been launched for individuals who have an activity in the cultural sector.

Companies

●

As of June 30, 2020, BBVA Argentina has disbursed more than $20.5 billion in loans to more than 9,000 SMEs, to be allocated in payroll payments, discounted documents and working capital, at a 24% nominal annual rate.

●

BBVA Argentina has granted a special credit line for payroll payments for SMEs, which includes a 24% nominal annual rate, in a 12 month period of maturity, and a grace period of 3 months, backed by the Fondo de Garantías Argentino (FoGAr) warrants. On this line, BBVA Argentina has disbursed $1.8 billion as of June 30, 2020.

●

92% of credits were granted through BBVA Net Cash, the online banking for companies.

●

The Bank is working on credit lines for self-employed individuals at a zero rate, promoted by the National Government. As of June 30, 2020, the Bank has disbursed more than $7 million on this line.

●

A new “Credit at subsidized rate” line has been launched for any company who requests it (as long as they are part of the eligible beneficiaries selected by the Federal Administration of Public Revenies or AFIP).

Human Capital

●

Due to the COVID-19 pandemic, the Bank has implemented a remote-work arrangement, through which employees can remotely access the Bank’s systems, supporting the continuity of operations and working to maintain adequate standards of internal control over financial information.

●

Currently, more than 90% of employees at central offices are working remotely.

Main Regulatory Changes

Public securities valuation in voluntary swap offers. (Communication “A” 7014, 05/14/2020). The BCRA stated that public sector debt instruments received in exchange of other public debt instruments, shall be accounted for the same value recorded on the date the instruments are swapped.

Fee suspension extended. (Communication “A” 7044, 06/18/2020). The BCRA extended until September 30, 2020 (previously June 30) the regulation stating that financial institutions cannot charge fees for transactions done through ATMs (Communication “A” 6945).

The BCRA also states that unpaid instalments deferral to maturity will apply to loans maturing until September 30, 2020 (previously June 30).

Exclusion of concepts from credit risk fractioning regulation (Communication “A” 7045, 06/18/2020). The BCRA stated that primary underwritings of national public

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securities to be settled with funds from the capital and interest payments of other national public securities, shall be excluded from the credit risk fractioning limits calculation (as long as the period between underwriting and settlement is no longer than 3 business days).

Reserve requirements. Consolidated calculation. (Communication “A” 7046, 06/18/2020). The BCRA overruled the consolidated calculation of the reserve requirements in pesos for the periods July/August and December/January of the following year.

Minimum holding period. (CNV General Resolution 843, 06/22/2020). The National Securities Commission (CNV in Spanish) stated that purchase and sale of securities in the local market with foreign settlement shall be compensated. A 5 business day minimum holding period is established for securities transferred from abroad and that will be settled in foreign currency.

Account closures. Extension. (Communication “A” 7048, 06/23/2020). The suspension in account closures and disabling of checking accounts for lack of fine payment is extended until December 31, 2020.

Subsidized loans to non-SME clients. Reserve requirements. (Communication “A” 7054, 06/25/2020). As of July 1, 2020, financing at 24% is enabled for non-SME clients, as long as the funds are used for the purchase of machinery and equipment produced by local SMEs. These financings are included in the reserve requirement reduction and calculation of daily net position of LELIQ, which limit is additionally reduced in 5%.

Repurchase agreement (REPO) with the BCRA collateral. (Communication “A” 7063, 07/03/2020). The BCRA incorporated corporate bonds as eligible collateral for its daily REPO transactions. As a condition, these must have been traded in the last five business days. The financial institution using corporate bonds as collateral cannot use securities that have been issued or secured by the same institution, or any other that is closely economically linked to it.

Exclusion of USD linked bonds from the Foreign Currency Global Net Position (PGNME). (Communication “A” 7071, 07/16/2020). The BCRA stated that as of July 20, 2020, securities linked to the change in price of a foreign currency, must be excluded from the calculation of the PGNME.

Special cautions on USD wire transfers. (Communication “A” 7072, 07/16/2020). The BCRA requested special caution previous to the realization of a wire transfer, in particular, over target accounts denominated in foreign currency, as of the second transfer received during the same calendar month. The institution must defer the accreditation of funds until all non-compliance suspicions related to the purchase of foreign currency by individuals are cleared.

Excess LELIQ position increment against PGNME margin (Communication “A” 7077, 07/30/2020). As of August 1, 2020, the excess net position in LELIQ can be incremented by the positive difference between: the maximum limit of the cash position within the Net positive Global Currency Position (the highest between USD 2.5 million, or 4% of the month’s regulatory capital, known as Responsabilidad Pratrimonial Computable or RPC) and the current cash position observed. In the case that the difference is negative, the increment in limit is zero.

Time deposit minimum rate. LELIQ excess net position. (Communication “A” 7078, 07/30/2020). As of August 1, 2020, the minimum rate for time deposits is increased from 79% to 87% of the monetary policy rate. Financial institutions granting time deposits at this rate will be able to increment the excess LELIQ position in 13% of the average amount of time deposits granted in the previous month, as of September 1, 2020.

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Foreign exchange operations. (Communication “A” 7079, 07/30/2020). The BCRA extends until August 31, 2020, the period of validity of regulation stated in Communication “A” 7030 and amendments, which restrict the access of importers to the foreign exchange market.

New subsidized credit lines. (Communication “A” 7082, 08/06/2020). The BCRA stated that financial institutions must grant “Credits at subsidized rates” to all companies that request them, as long as they are in the beneficiary list that will be released by the Federal Administration of Public Revenues (AFIP). The interest rate will be determined according to the year over year increment in the company’s revenues (with a maximum rate of 15%). The Fondo Nacional de Desarrollo Productivo (FONDEP) will recognize an annual nominal rate equivalent to the difference between 15% and the interest rate paid by the company, in line with the previously mentioned limits.

Additionally, financial institutions must grant “Zero rate culture credits”. The AFIP will release the list of eligible beneficiaries, the amount and institution that will grant the loan. The nominal annual rate recognized by the FONDEP to financial institutions will be 15%.

For both credit lines, reserve requirements can be reduced in 60% of the total amount of financings granted. The beneficiaries will not have access to the foreign exchange market, cannot settle securities in foreign currency, nor be granted time deposits at the minimum interest rate.

Glossary

Public Sector Exposure (excl. BCRA): (Public debt with the National and Provincial Government + Loans to the public sector + REPO transactions) / Total Assets

ROE (accumulated): Attributable Net Income / Average Equity. Average Equity is calculated as the average between equity in December of the previous year and equity in the current period, expressed in local currency.

ROA (accumulated): Attributable Net Income / Total Average Assets. Total Average Assets is calculated as the average between total assets on December of the previous year and total assets in the current period, expressed in local currency.

ROE (quarterly): Attributable Net Income / Average Equity. Average Equity is calculated as the average between equity on the previous quarter end and equity in the current period, expressed in local currency.

ROA (quarterly): Attributable Net Income / Total Average Assets. Total Average Assets is calculated as the average between total assets on the previous quarter end and total assets in the current period, expressed in local currency.

Liquidity Ratio: (Cash and deposits in banks + Debt securities at fair value through profit or loss (excl. Private securities) + Net REPO transactions + Other debt securities (excl. Private securities) / Total Deposits

Efficiency Ratio: (Personnel benefits + Administrative Expenses + Depreciation & Amortization) / (Net Interest Income + Net Income from measurement of Financial Instruments at Fair Value + Foreign exchange and gold gains + Net Fee Income + Insurance activity income + Other net operating income)

Coverage Ratio: Allowances under the Expected Credit Loss model / non-performing portfolio

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Cost of Risk: Current period loan loss allowances / Total average loans. Total aveage loans calculated as the average between loans at prior period end, and total loans in the current period.

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Balance Sheet


Balance Sheet	BBVA ARG Consolidated									Chg (%)						Proforma ⁽¹⁾
In millions AR$ - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY			2Q20
Assets
Cash and deposits in banks		112,525			154,393			129,846			(27.1%	)		(13.3%	)		112,163
Cash		50,468			39,332			22,636			28.3%			123.0%			50,468
Financial institutions and correspondents		62,057			115,061			107,210			(46.1%	)		(42.1%	)		61,695
B.C.R.A		57,915			110,432			104,904			(47.6%	)		(44.8%	)		57,571
Other local and foreign financial institutions		4,142			4,628			2,306			(10.5%	)		79.6%			4,124
Debt securities at fair value through profit or loss		9,756			9,546			9,409			2.2%			3.7%			9,756
Derivatives		1,057			2,271			2,624			(53.5%	)		(59.7%	)		1,057
Repo transactions		34,267			3,374			8,458			n.m			305.2%			34,267
Other financial assets		6,377			19,592			10,530			(67.4%	)		(39.4%	)		6,241
Loans and other financing		243,226			230,229			266,503			5.6%			(8.7%	)		232,565
Non-financial public sector		0			1			0			(73.7%	)		(66.3%	)		0
B.C.R.A		-			12			0			(100.0%	)		(100.0%	)		-
Other financial institutions		3,504			5,296			10,855			(33.8%	)		(67.7%	)		6,677
Non-financial private sector and residents abroad		239,722			224,920			255,648			6.6%			(6.2%	)		225,887
Other debt securities		81,502			68,237			99,595			19.4%			(18.2%	)		81,502
Financial assets pledged as collateral		10,749			7,182			9,068			49.7%			18.5%			10,748
Current income tax assets		9			0			1			n.m			n.m			9
Investments in equity instruments		1,805			1,909			2,733			(5.5%	)		(34.0%	)		1,805
Investments in subsidiaries and associates		1,229			1,187			3,065			3.5%			(59.9%	)		3,123
Property and equipment		28,270			28,801			32,081			(1.8%	)		(11.9%	)		28,228
Intangible assets		1,068			969			1,002			10.2%			6.5%			1,067
Deferred income tax assets		5,281			7,815			(2,225	)		(32.4%	)		337.3%			4,885
Other non-financial assets		4,772			4,515			2,939			5.7%			62.3%			4,660
Non-current assets held for sale		189			189			189			-			(0.0%	)		189
Total Assets		542,080			540,207			575,818			0.3%			(5.9%	)		532,264
Liabilities
Deposits		373,260			345,586			407,150			8.0%			(8.3%	)		372,431
Non-financial public sector		5,463			3,660			5,190			49.3%			5.3%			5,463
Financial sector		300			302			423			(0.9%	)		(29.2%	)		385
Non-financial private sector and residents abroad		367,497			341,624			401,538			7.6%			(8.5%	)		366,583
Liabilities at fair value through profit or loss		-			-			1,651			N/A			(100.0%	)		-
Derivatives		230			349			3,267			(34.3%	)		(93.0%	)		230
Other financial liabilities		28,261			45,132			32,931			(37.4%	)		(14.2%	)		27,841
Financing received from the B.C.R.A. and other financial institutions		5,099			3,822			4,699			33.4%			8.5%			308
Corporate bonds issued		4,203			7,902			6,180			(46.8%	)		(32.0%	)		2,948
Current income tax liabilities		3,238			12,200			6,580			(73.5%	)		(50.8%	)		3,161
Provisions		11,000			11,880			10,625			(7.4%	)		3.5%			10,946
Deferred income tax liabilities		4			-			67			N/A			(93.4%	)		4
Other non-financial liabilities		21,836			19,790			18,496			10.3%			18.1%			21,291
Total Liabilities		447,131			446,661			491,647			0.1%			(9.1%	)		439,161
Equity
Share Capital		613			613			613			-			0.0%			613
Non-capitalized contributions		22,017			22,017			22,006			(0.0%	)		0.1%			22,017
Capital adjustments		15,452			15,452			15,452			(0.0%	)		0.0%			15,452
Reserves		82,448			49,781			49,800			65.6%			65.6%			82,448
Retained earnings		(26,973	)		11,022			(15,266	)		(344.7%	)		(76.7%	)		(26,973	)
Other accumulated comprehensive income		(6,233	)		(10,734	)		119			41.9%			n.m			(7,008	)
Income for the period		5,754			3,244			13,694			77.3%			(58.0%	)		5,754
Equity attributable to owners of the Parent		93,077			91,727			84,123			1.5%			10.6%			93,077
Equity attributable to non-controlling interests		1,872			1,819			48			2.9%			n.m			26
Total Equity		94,949			93,546			84,172			1.5%			12.8%			93,103
Total Liabilities and Equity		542,080			540,207			575,818			0.3%			(5.9%	)		532,264

(1) Excludes consolidation with PSA and VWFS.

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Balance Sheet – Foreign currency exposure


Foreign Currency Exposure	BBVA ARG Consolidated						Chg (%)
In millions AR$ - Inflation adjusted	2Q20		1Q20		2Q19		QoQ			YoY
Assets
Cash and deposits in banks		87,054		91,277		89,016		(4.6%	)		(2.2%	)
Debt securities at fair value through profit or loss		0		0		11		43.1%			(97.5%	)
Repos		-		-		8,082		N/A			(100.0%	)
Other financial assets		1,867		1,774		544		5.2%			243.1%
Loans and other financing		32,854		39,849		95,980		(17.6%	)		(65.8%	)
Other financial institutions		1,178		1,116		797		5.6%			47.9%
Non-financial private sector and residents abroad		31,675		38,733		95,183		(18.2%	)		(66.7%	)
Other debt securities		4,194		7,500		16,152		(44.1%	)		(74.0%	)
Financial assets pledged as collateral		6,672		2,525		4,483		164.2%			48.8%
Investments in equity instruments		18		16		26		10.5%			(32.2%	)
Total foreign currency assets		132,658		142,942		214,293		(7.2%	)		(38.1%	)
Liabilities
Deposits		115,988		122,257		194,140		(5.1%	)		(40.3%	)
Non-Financial Public Sector		2,316		2,200		3,887		5.3%			(40.4%	)
Financial Sector		48		46		132		5.2%			(63.4%	)
Non-financial private sector and residents abroad		113,623		120,011		190,121		(5.3%	)		(40.2%	)
Liabilities at fair value through profit or loss		-		-		237		N/A			(100.0%	)
Other financial liabilities		7,853		12,333		12,914		(36.3%	)		(39.2%	)
Financing received from the B.C.R.A. and other financial institutions		544		855		4,687		(36.4%	)		(88.4%	)
Other non financial liabilities		890		1,142		1,459		(22.0%	)		(39.0%	)
Total foreign currency liabilities		125,274		136,587		213,436		(8.3%	)		(41.3%	)

Foreign Currency Net Position - AR$		7,384		6,356		857		16.2%			n.m

Foreign Currency Net Position - USD		105		99		20		6.3%			419.1%

Income Statement


Income Statement	BBVA ARG Consolidated									Chg(%)						Proforma (1)
In millions AR$ - Inflation adjusted	2Q20			1Q20			2Q19			QoQ			YoY			2Q20
Interest income		22,342			25,935			33,805			(13.9%	)		(33.9%	)		21,129
Interest expense		(6,465	)		(8,611	)		(14,648	)		24.9%			55.9%			(5,952	)
Net interest income		15,876			17,325			19,157			(8.4%	)		(17.1%	)		15,177
Fee income		6,104			5,691			6,408			7.3%			(4.7%	)		6,103
Fee expenses		(2,996	)		(3,715	)		(3,560	)		19.3%			15.8%			(2,972	)
Net fee income		3,109			1,977			2,848			57.3%			9.2%			3,131
Net income from financial instruments at fair value		1,016			1,300			3,100			(21.8%	)		(67.2%	)		1,262
Net loss from write-down of assets at amortized cost and fair value through OCI		(2,067	)		(134	)		(54	)		n.m			n.m			(2,067	)
Foreign exchange and gold gains		1,494			1,304			1,914			14.6%			(21.9%	)		1,503
Other operating income		1,142			1,095			6,450			4.3%			(82.3%	)		1,168
Loan loss allowances		(2,646	)		(1,711	)		(2,594	)		(54.7%	)		(2.0%	)		(2,612	)
Net operating income		17,925			21,156			30,820			(15.3%	)		(41.8%	)		17,561
Personnel benefits		(3,966	)		(4,678	)		(4,756	)		15.2%			16.6%			(3,890	)
Administrative expenses		(3,831	)		(3,783	)		(3,548	)		(1.3%	)		(8.0%	)		(3,768	)
Depreciation and amortization		(843	)		(867	)		(696	)		2.8%			(21.0%	)		(837	)
Other operating expenses		(2,585	)		(3,525	)		(8,944	)		26.6%			71.1%			(2,718	)
Operating income		6,700			8,303			12,876			(19.3%	)		(48.0%	)		6,349
Income from associates and joint ventures		188			29			278			n.m			(32.5%	)		258
Income from net monetary position		(2,285	)		(2,765	)		(2,118	)		17.4%			(7.8%	)		(2,126	)
Income before income tax		4,603			5,567			11,036			(17.3%	)		(58.3%	)		4,480
Income tax		(2,046	)		(2,293	)		(2,478	)		10.8%			17.4%			(1,945	)
Income for the period		2,557			3,274			8,558			(21.9%	)		(70.1%	)		2,535
Income for the period attributable to:
Owners of the parent		2,510			3,244			8,563			(22.7%	)		(70.7%	)		2,510
Non-controlling interests		47			30			(4	)		58.4%			n.m			26

Other comprehensive income		1,927			1,216			(4,654	)		58.4%			141.4%			1,926

(1) Excludes consolidation with PSA and VWFS.

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LOGO

Ratios


Quarterly Annualized Ratios	BBVA ARG consolidated									Chg(bps)
	2Q20			1Q20			2Q19			QoQ		YoY
Profitability
Efficiency Ratio		47.4	%		47.4	%		36.1	%		1 pbs		1,130 pbs
ROA		1.9	%		2.5	%		5.8	%		(61)pbs		(394)pbs
ROE		10.9	%		14.6	%		40.9	%		(369)pbs		(3,000)pbs
Liquidity
Liquid assets / Total Deposits		63.7	%		68.1	%		60.7	%		(436)pbs		309 pbs
Capital
Regulatory Capital Ratio		21.9	%		21.8	%		19.4	%		10 pbs		249 pbs
TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)		21.2	%		21.2	%		18.7	%		8 pbs		252 pbs
Asset Quality
Total non-performing portfolio / Total portfolio		1.56	%		2.78	%		2.66	%		(122)pbs		(111)pbs
Allowances /Total non-performing portfolio		269.38	%		186.91	%		110.43	%		8,246 pbs		15,895 pbs
Cost of Risk		3.99	%		2.58	%		3.38	%		142 pbs		61 pbs


Accumulated Annualized Ratios	BBVA ARG consolidado									Chg(bps)
	2Q20			1Q20			2Q19			QoQ		YoY
Profitability
Efficiency Ratio		47.4	%		47.4	%		38.7	%		1 pbs		869 pbs
ROA		2.2	%		2.5	%		5.0	%		(28)pbs		(277)pbs
ROE		12.8	%		14.6	%		34.4	%		(175)pbs		(2,158)pbs
Liquidity
Liquid assets / Total Deposits		63.7	%		68.1	%		60.7	%		(436)pbs		309 pbs
Capital
Regulatory Capital Ratio		21.9	%		21.8	%		19.4	%		10 pbs		249 pbs
TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)		21.2	%		21.2	%		18.7	%		8 pbs		252 pbs
Asset Quality
Total non-performing portfolio / Total portfolio		1.56	%		2.78	%		2.7	%		(122)pbs		(111)pbs
Allowances /Total non-performing portfolio		269.38	%		186.91	%		110.43	%		8,246 pbs		15,895 pbs
Cost of Risk		6.47	%		2.58	%		5.59	%		389 pbs		88 pbs

About BBVA Argentina

BBVA Argentina (NYSE; BYMA; MAE: BBAR; LATIBEX: XBBAR) is a subsidiary of the BBVA Group, the main shareholder since 1996. In Argentina, it is one of the leading private financial institutions since 1886. Nationwide, BBVA Argentina offers retail and corporate banking to a broad customer base, including: individuals, SME’s, and large-sized companies.

BBVA Argentina’s purpose is to bring the age of opportunities to everyone, based on our customers’ real needs, providing the best solutions, and helping them make the best financial decisions through an easy and convenient experience. The institution relies on solid values: “The customer comes first, We think big and We are one team”. At the same time, its responsible banking model aspires to achieve a more inclusive and sustainable society.

Investor Relations contact

Ernesto Gallardo

Chief Financial Officer

Inés Lanusse

Investor Relations Officer

investorelations-arg@bbva.com

ir.bbva.com.ar

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Banco BBVA Argentina S.A.

Date: August 25, 2020

/s/ Ernesto Gallardo Jimenez

Ernesto Gallardo Jimenez

Chief Financial Officer