Open Annual Bankinter Group report

Report 

Business Report

2007 Business Report

People 

More talent 

+13.8% 

3,981 

A year ago 

4,530 

Now

Growth with profitability 

+23.5% 

ROE 2007 

+14.9% 

ROE 2006 

57.0% 

more than 

in 2006

Proven solvency 

Non-performing loans ratio 

0.36% 

Solvencia demostrada 

NPL ratio of the 

mortgage portfolio 

0.18% 

Coverage ratio 

of non-performing 

loans 

370%

An excellent year 

PBT 

€484.5 

million 

+53.2% 

up on 2006

Bankinter 2007 Business Report 

Consolidated financial highlights 6 

Consolidated financial highlights 

2006 2007 07/06 (%) 

Balance sheet (thousands of euros) 

Total assets 46,075,769 49,648,680 7.75 

Loans and receivables 


31,653,807 37,580,125 18.72 

ex-mortgage securitisations 34,416,012 39,923,558 16.00 

Customer funds 32,683,580 38,774,288 18.64 

Off-balance-sheet funds under management 

of which: investment 

11,499,765 11,350,919 -1.29 

and pension funds 9,988,850 9,468,367 -5.21 

Controlled customer funds 44,183,345 50,125,207 13.45 

Earnings (thousands of euros) 

Profit before tax 316,336 484,462 53.15 

Net profit 208,490 361,863 73.56 

Ratios (%) 

Non-performing loans ratio ex-securitisation 0.25 0.36 45.02 

Non-performing loans coverage ratio 569.91 370.25 -35.03 

Efficiency ratio 49.08 53.94 9.89 

ROE 14.94 23.46 57.03 

ROA 0.48 0.75 56.03 

Capital ratio 10.03 9.55 -4.79 

Tier 1 6.86 6.32 -7.87


Consolidated financial highlights 

7 

2006 2007 07/06 (%) 

Share data 

EPS, Net earnings per share 0.54 0.92 71.64 

DPS, Dividend per share (euros) 0.26 0.30 15.01 

PER, Price/Earnings ratio (times) 22.46 13.62 -39.36 

Price/book value (times) 3.05 2.82 -7.58 

EPS, Net earnings per share (euros) + provisions 0.68 0.99 45.62 

Branches and centres 

Non-specialised branches 

Commercial management centres 

332 360 8.43 

Corporate 50 51 2.00 

SMEs 124 161 29.84 

Private Banking 41 47 14.63 

Virtual branches 527 552 4.74 

Number of agents 1,003 996 -0,70 

Telephone and Internet branches 3 3 0.00 

Workforce 

No. of full-time equivalent employees 3,981 4,530 13.79


Chairman's Letter to the Shareholders 8 

During the months that I have been in charge at the Bank 

I have been able to observe on a daily basis the power 

there is in this marvellous business, 

the huge value of its intangible assets, 

its capacity for growth, the soundness 

of its balance sheet and, over and above 

any other consideration, 

the qualities of its team of people 

and its senior management 

who, in my opinion, 

are the best in the Spanish 

financial sector.


Chairman's Letter to the Shareholders 

9 

Dear Shareholders: 

2007 

Since this is the first occasion on which I am addressing you as the Chairman of Bankinter, I should 

first of all like to refer to my predecessor. In April 2007, Juan Arena took the decision to tender his 

resignation as Chairman of Bankinter, after devoting 37 years of his life to the Bank, 9 of them as 

Chief Executive Officer and the last 5 as Chairman of the Board of Directors. On behalf of the Board 

and everyone at the Bank I would like to express our gratitude to Juan Arena, who for so many 

years held the top executive responsibilities with truly unique success, personality and capacity for 

leadership. To a large extent, the Bank's strategy, based on quality, innovation, technology and 

talent management, is marked by the imaginative and creative personality of the previous 

Chairman, with whom I have been actively working on the Board of Directors since 1991. Our 

challenge is to continue his work. And in order to do so Bankinter must continue to set itself apart, 

to remain unique within the context of the Spanish banking system, with its course set on what has 

always been our prime objective: creating value for our shareholders in the medium and long term. 

December 2007 brought to a close a year in which the profit after tax amounted to EUR 

361.9 million, by far the biggest in the history of the Bank, and 73.6% more than in 2006. The 

consolidated pre-tax profit was EUR 484.5 million, which was 53.2% more than in 2006. These are 

record results, the value of which is even greater when we take into account that they were 

achieved despite the difficulties and uncertainties that arose in the markets as a result of the 

constraints on liquidity that occurred from August 2007. 

This profit figure includes certain non-recurring earnings which, although similar to those 

that may also appear in the accounts of other credit institutions, I would like to mention 

separately: the sale to Mapfre of the life insurance business, generating capital gains of EUR 114.8 

million after tax; and the acquisition of 100% of the consumer credit card business until now jointly 

owned with Capital One. Excluding the atypical factors, the Bank's net profit would be EUR 272.2 

million, 31% more than the figure published for the previous year. These are splendid results which 

undoubtedly rank among the best of those achieved by Spanish banks last year.



This increase in earnings is especially commendable if we take into account that 

in 2007 Bankinter underwent strong expansion as regards both the number of 

offices (a total of 72 were opened comprising non-specialised branches and SME, 

Private and Corporate Banking centres) and the number of employees (the 

workforce increased by 549 persons, 13.8% more than at the end of 2006). Such 

significant growth in the installed capacity is initially a burden on the Bank's 

profit, because the new centres take a while to reach the profitability of the 

existing branches and there is a fall in the efficiency ratio in the short term, but it 

is what ensures and drives future growth and is tangible proof of the confidence 

that Bankinter has in its business model. 

Although all of the segments of the customer business experienced 

substantial growth in profit, most noteworthy were the earnings of those which 

Bankinter considers strategic and in which the Bank continued to invest 

significantly in 2007: SMEs, and Private Banking and Personal Finance, which 

encompass the private individual customers with the highest net worth. 

The SME segment experienced an increase of 41.9% in profit after tax, and 

also recorded increases of 23.4% in lending, 21.8% in customer funds and 17% in 

active customers. 

As regards Private Banking and Personal Finance, the increase in profit 

after tax was 27.8% and 29.2%, respectively. 

There was appreciable growth in all of the captions of Bankinter's balance 

sheet. Total assets rose by 7.8%. Customer funds increased by 18.6% and loans 

and receivables were up by 18.7%. 

At 2007 year-end, doubtful risk stood at EUR 155.3 million and accounted 

for 0.36% of the Bank's computable risk exposure, which is much lower than that 

of Spanish banks as a whole. In parallel, the non-performing loans coverage ratio 

stood at 370%. The total loan loss allowances were up by 8.2% on 2006. All of this 

confirms the high credit quality of the Group's assets and also its solvency, both of 

them based on the now traditional internal systems of the analysis, approval and 

automatic management of risk, the diversification of the portfolio, very limited 

exposure to property development, the conservative provisions allocated to loan 

losses, and the virtually zero exposure to country risk.



11 

Worthy of a separate mention are the results achieved, once again, by Línea 

Directa Aseguradora S.A., the company of which the Royal Bank of Scotland Group 

and Bankinter each own 50%. In 2007, LDA achieved a marked increase in its 

customer base, reaching a total of 1,431,327 policies, and embarked on a number 

of product diversification initiatives which are already generating earnings 

additional to those of the company's original business, resulting in a rapid 

increase in the asset value of our stake and in the synergies between the 

insurance company and the Bank. The company's profit after tax amounted to 

nearly EUR 59 million. 

Other highlights in the year were the sale of 50% of the life insurance 

subsidiary Bankinter Seguros de Vida to the Spanish sector leader Mapfre Vida, in 

a transaction carried out in very beneficial conditions that ensures us long-term 

partnership with such a prestigious and professional group as Mapfre and, also, the 

acquisition of 100% of the consumer finance business which the Bank shared with 

the international entity Capital One and which is now trading under the new brand 

'Obsidiana'. In both life insurance and general insurance as well as in consumer 

lines and credit cards, Bankinter now occupies a position of privilege in comparison 

with its competitors and covers a number of businesses that are complementary to 

banking and have considerably increased the value of our Group. 

In 2007 Bankinter proved able to respond to the challenges arising out of 

the turbulence that affected the capital markets from August onwards, the upturn 

in non-performing loans and the emergence of certain symptoms of a possible 

economic recession. 

In the face of persistent liquidity constraints, the Bank continued to 

strengthen its capital base and diversify its sources of financing, generating 

assets that are capable of being realised thanks to the solvency of our portfolio of 

mortgages and other loan assets, innovating through new structures for the 

value-enhancement of these portfolios with the transfer of all of their risks, and 

optimising not only the funds from intermediation, but also the raising of typical 

funds from the Bank's broad customer base that is situated in the top segment of 

the market. 

With respect to the upward trend in non-performing loans in the sector, our 

traditional prudence and the foresight of how the property sector would evolve 

that we have developed over the last few years have enabled us to present the 

figures for non-performing loans and coverage that I have indicated above, 

the best of the Spanish banking system, which place Bankinter in a situation of 

privilege even if the worst forecasts regarding the immediate economic future 

were to be confirmed.



In 2007, Bankinter continued to implement a corporate governance policy that 

meets the most demanding standards regarding transparency and good 

governance not only in Spain but also internationally. Mention should be made in 

this respect of the fact that Bankinter is now in full compliance with more than 

95% of the recommendations contained in the CNMV-approved Unified Code of 

Good Governance for Listed Companies applicable since 2007, and is in first place 

out of all the banks and companies in the Ibex-35 stock exchange index in the 

league table of best practices. Particularly noteworthy is the fact that on its 

'Corporate Reporting' website the consultancy firm PricewaterhouseCoopers UK 

includes the content of Bankinter's Annual Report as an example of good practice. 

We realise that in the world in which we live the creation of value is a 

commitment that a company has not only with its shareholders but also with all 

of its stakeholders, comprising mainly its employees, its customers and society in 

general. 

Regarding the first of these groups, Bankinter reaffirms its conviction that 

people are its prime asset. Bankinter's workforce, which as I have already said 

grew by 13.8% in 2007, is the youngest and the best qualified in Spanish banking, 

with an average age of 36 years and 73% of whom are university graduates. The 

Bank's constant concern for staff management has resulted in Bankinter being 

acknowledged by the prestigious Great Place to Work Institute in its latest report 

as the 6th best place to work in Spain and the number one in the financial sector, 

in a league table in which more than 200 companies from every economic sector 

put themselves forward for analysis. This is a distinction that fills us with pride. 

Our commitment to customers is reflected in our traditional concern for 

quality, which is something we have monitored and managed for many years now 

and constitutes our principal guideline. In 2007 Bankinter maintained its 

customary position of leadership in this field with a lead of 6 percentage points 

with respect to the average for banks in terms of ISN (Net Satisfaction Index), 

which is the technical indicator used to measure this parameter. 

With regard to relations with society in general, the Bank continued to 

be one of the sector leaders in job creation, in investment in research and 

development and in new technologies, as well as in transparency in relations with 

suppliers. Bankinter reaffirmed its commitment to Social Action, and received 

significant recognition and awards in this field.



13 

In environmental management the Bank was awarded an ISO 14001 certificate 

certifying the implementation of an efficient system of environmental 

management in the building where the Bank has its corporate headquarters. Our 

commitment to the disabled and to accessibility continued and was rewarded with 

the following prizes, among others: ‘diadeinternet’, organised by the Spanish 

Internet Users Association, and the annual prize awarded by the Bip Bip 

Foundation, both of them in recognition of the Bank's activities in the area of 

accessibility. Initiatives for volunteer service among the Bank's employees were 

also encouraged with a variety of actions that were very successful. 

In short, Bankinter is a model of success, in the first place for shareholders, 

because the share price appreciated by 5.3% in 2007 which, together with the 

dividend distributed, resulted in a return for shareholders of 7.8%, one of the 

highest in Spanish banking in the year, but also for employees, for customers, for 

suppliers and for society in general. 

During the months that I have been in charge at the Bank I have been able 

to observe on a daily basis the power there is in this marvellous business, the 

huge value of its intangible assets, its capacity for growth, the soundness of its 

balance sheet and, over and above any other consideration, the qualities 

of its team of people and its senior management who, in my opinion, are the best 

in the Spanish financial sector. 

Against this framework I have no doubt that in 2008 Bankinter will 

continue to be able to offer a value proposal that is unique in the market and a 

business model that is different, based on excellence and on the generation of 

ever higher earnings. 

With full adherence to the Board of Directors’ remit to me as Chairman, I do 

not wish to end this letter without reiterating my commitment to service in the 

interests of all of you, the shareholders and owners of Bankinter, the Bank's 

employees and customers, and our community. 

Yours sincerely, 

Pedro Guerrero 

Chairman of the Board of Directors

16 

Quality 

Contents 

28 

Technology 

30. Technology 

32. IT security 

18. Bankinter Quality 

21. Quality in serving individual customers 

22. Quality in SMEs 

23. Quality in employees 

24. Customer Service Office 

26. Acting to improve quality 

36 

Channels and Networks 

38. Multi-channel Banking 

43. Distribution networks 

50. CRM 

52 

Intellectual Capital 

58. Human Capital 

61. Structural Capital 

62. Relational Capital 

64 

People & Knowledge 

Management 

66. Our value, our values 

67. Bankinter, a great place to work 

68. People management 

74. Recognition 2007

76 

Business 

142 

Earnings 

144. Earnings 

153. Bankinter’s Contribution to GDP 

78. Economic environment and international markets 

81. Market share 

82. Customer funds and loans and receivables 

90. Customer segments 

99. Capital Markets and Treasury 

101. Risk management 

165 

Brand 

154 

Shareholders' Equity and 

The Bankinter share 

156. Shareholders’ equity 

158. The Bankinter share 

164. Market return 

175 

Appendixes 

176. Information for 

shareholders 

and customers 

178. Board of Directors 

179. Management structure


17 

Year after year the Bank's quality ratios reach 

levels of excellence that are well above 

the average for the sector. 

The degree of customer satisfaction and the 

extent to which their expectations are met, 

measured by means of objective surveys carried 

out monthly, are the variables that guarantee a 

strong relationship in the long term. 

01 

Quality 

In this section: 

> Bankinter Quality 

> Quality in serving individual customers 

> Quality in SMEs 

> Quality in employees 

> Customer Service Office 

> Taking action to improve quality


01. Quality 18 

Overall satisfaction by segment 2007 (ISN score out of 100) 

We take the utmost care with the terms of 

our relationship with customers and we pay 

special attention to their needs. 

Bankinter Quality 

The data obtained in any survey of financial customers on the quality of service 

provided by banks and savings banks show that they have increasing access to 

information and are ever more sensitive to prices. This has led us to take the 

utmost care with the terms of our relationship with customers and to pay special 

attention to their needs. 

Private individuals Private banking SMEs Corporate banking Foreign nationals 

77.1 77.0 76.7 77.7 83.1 

The ISN (Net Satisfaction Index) is measured 

on a scale of 0 through 100 and is interpreted 

as follows: 

> 85 Very satisfied/excellent. 

75-85 High level of satisfaction. 

60-75 Needs improvement. 

< 60 Needs action. 

2006 2007 

Private individuals 76.90 77.14 

Private banking 77.55 76.95 

SMEs 77.19 76.70 

Corporate banking 78.67 77.72 

Foreign Nationals 83.21 83.12 

AT Bankinter we are obsessed with the needs of our customers, rather than with 

the attributes of our products, and this obliges us to keep our promises, to exceed 

expectations and to treat the experience of customers as a clear competence 

involving all of the Bank's areas. 

The customers' experience with the Bank is the best mechanism of 

differentiation. That is why we are building our commercial approach on the basis 

of doing what is in the interests of the customers and not just what suits the 

Bank's income statement.


01. Quality 

19 

The Bank's customers maintain a high level of satisfaction with the service 

received. Checking their opinion by means of surveys performed by independent 

firms, including INMARK, is the method Bankinter has chosen to ascertain 

whether the quality of the Bank's range of services is up to standard. This 

measurement, performed monthly using a dynamic and formal procedure, 

enables us to ascertain and interpret the customers' opinion from any angle of the 

relationship: the segment to which they belong and the service platform they use, 

making it possible to detect and react promptly to correct or improve any 

anomaly. 

The measurement of this perception obtained from our customers is 

checked against innumerable objective indicators: market and product research, 

internal satisfaction surveys, etc., facilitating structural quality actions which 

involve adaptation to the quality models, and commercial quality actions, which 

produce immediate satisfaction among customers. 

We would not like to miss this opportunity of thanking all our customers 

very sincerely for the interest, care and time they take to respond to our surveys, 

thereby enabling us to learn of their experiences, evaluate them and focus our 

efforts on what their interests are. 

Obsessed with the needs of our customers 

The degree of customer satisfaction and, accordingly, the extent to which their 

expectations are met, measured by means of the objective surveys carried out 

monthly by the Bank, is the variable that guarantees a strong relationship in the 

long term. 

As can be seen from the charts, most of the Bank’s segments, networks and 

platforms scored consistently over 75 points on the ISN scale. Any score above 75 

points reflects high service quality.



2006 2007 

Private individuals 76.90 77.14 

Private banking 77.55 76.95 

SMEs 77.19 76.70 

Corporate banking 78.67 77.72 

Foreign Nationals 83.21 83.12 

2006 2007 

Branch network 77.55 77.46 

Telephone network 73.49 73.62 

Internet network 77.42 77.81 

Virtual branches 79.27 77.47 

Agents network 78.80 79.60 

2006 2007 

Telephone Banking 79.39 79.40 

Bankinter Private individuals 80.33 80.30 

Broker Bankinter 79.23 77.59 

Bankinter Businesses 79.88 79.09 

Mobile phones 86.69 83.10 

Overall satisfaction by segment 2007 (ISN score out of 100) 

84 

82 

80 

78 

76 

Overall satisfaction by network 2007 (ISN score out of 100) 

83 

81 

79 

77 

75 

73 

2005 2006 2007 

Telephone network Internet network 

Virtual branch network Agents network 

Overall satisfaction by platform 2007 (ISN score out of 100) 

87 

85 

83 

81 

79 

77 

75 

2005 2006 2007 

Telephone banking Bankinter Private individuals Broker Bankinter 

Bankinter businesses 

2005 2006 2007 

Private individuals Private banking SMEs Corporate banking Foreign Nationals 

Branch network 

Mobile phones


01. Quality 

+6.0 

ISN points 

higher than 

the market average 

21 

Year after year Bankinter stands well ahead, 

of the market in the segment of private 

individuals. 

Quality in serving individual customers 

The best indicator of the perception of the service received by Bankinter's 

individual customers and of their greater or lesser degree of satisfaction is the one 

obtained by comparing the position that Bankinter occupies in relation to other 

financial entities in the Spanish market and analysing which are the most 

significant service factors. 

Using independent consultants we conduct market research on a quarterly 

basis that enables us to ascertain the degree of perceived satisfaction that 

customers (private individuals) have with the service they receive from their 

banks or savings banks. 

Bankinter vs Market. Private Individuals 

80 

78 

76 

74 

72 

70 

68 

2005 2006 2007 

Bankinter Market 

2006 2007 

Bankinter 76.81 76.80 

Market 70.46 70.70 

Gap 6.35 6.03 

Geographic scope: Nationwide, for towns of over 

50,000 inhabitants. 

Group: General public over 18 years of age, holding 

demand deposits or savings accounts at a financial 

institution. 

Sample: 1,600 interviews per quarter. 

Survey methodology: Computer-assisted telephone 

interview. 

Sampling error: ±2.5%. 

6.03 

14 aspects of service surveyed; the most 

highly rated would be: 

Treatment and attention 

Training and professionalism 

Advisory services 

Knowledge of customers' requirements 

Employee’s attitude to incidents 

Information on conditions and costs 

Transaction speed 

Clarity of statements 

Availability of human and technical 

resources



+0.7 

ISN points 

higher than 

the market average 

The customers of Bankinter's SME segment 

rate the Bank higher than the average for 

the sector. 

Quality in SMEs 

The Bank also conducts half-yearly market research to ascertain the level of 

satisfaction with the service they receive from their bank or savings bank of, in 

this case, SMEs, as financial service users. 

Bankinter vs Market. SMEs 

78 

76 

74 

72 

2005 2006 2007 

Bankinter Market 

2006 2007 

Bankinter 77.70 76.58 

Market 74.82 75.88 

Gap 2.88 0.70 

Geographic scope: The whole of Spain (except Ceuta and 

Melilla). 

Group: Spanish businesses with an approximate turnover 

of EUR 0.5-5 million. 

Sample: 1,117 interviews every six months 

Survey methodology: Computer-assisted telephone 

interview. 

Sampling error: ±3.0%. 

0.70 

16 aspects of service surveyed; the most 

highly rated would be: 

Treatment and attention 

Advisory services 

Training and professionalism 

Service offered at branch 

Products and services 

Clarity of information 

Simplicity of formalities


01. Quality 

2006 2007 

Branches 69.96 70.14 

Central Services 66.32 65.95 

Organisations' Central Services 70.58 71.54 

23 

Quality in employees 

Every six months Bankinter’s Central Services are evaluated by the Branch 

Network and they also perform a self-evaluation. This evaluation, together with 

the performance in customer satisfaction, constitutes the 'Quality Factor', in 

which all of the Bank's staff are involved. 

The perception in 2007 remained at good levels in comparison with the 

previous year, with improvements in 2 of the surveys of all the staff conducted to 

ascertain the perception of service received internally. This led to a 0.9 point 

increase in the ISN score given to the Organisations' Central Services by the 

Branch network, which stood at 71.5. Likewise, there was a 0.14 point increase in 

the survey of the Bank's Central Services by the Branch network, with a score of 

70.1. It was in the Bank's Central Services self-evaluation that there was a fall 

of 0.4, giving a Net Satisfaction Index score of 66.0 points. 

Overall satisfaction. Branches and Central Services survey 

73 

71 

69 

67 

65 

63 

2005 2006 2007 

Branches Central Services Organisations' Central Services



Customer Service Office 

At Bankinter all complaints and claims of a financial nature go to the Customer 

Service Office (SAC in Spanish), which coordinates the different departments 

concerned and immediately relays all the information on incidents in order to 

resolve them as quickly as possible, taking very much into account that customers 

should perceive that the Bank is acting in their interests. 

The purpose of the Office is therefore to deal with and resolve complaints 

and claims, ensuring, in an appropriate and timely manner, that there is a 

consistent approach. As well as solving customers' problems, this is the 

department responsible for preventing and correcting the main errors made in 

any area of the Bank in the marketing of products or the provision of services. 

In 2007 the number of complaints about service and financial claims per 

million transactions fell to 78.3 per million (compared with 86.7 per million in 

2005). As for the time taken to deal with complaints and claims, 70.6% of the 

incidents were answered in less than 48 hours, and the average time taken 

was 4.3 days. 

SAC. Total complaints and financial claims 

2006 2007 07/06 (%) 

Total no. of complaints (non-financial) 10,821 12,422 14.80 

Total no. of claims (financial) 85,371 91,841 7.58 

Total 96,192 104,263 8.39 

SAC. Total no. of financial claims 

2006 2007 07/06 (%) 

No. of claims in customer's favour 74,987 82,416 9.01 

% of claims in customer's favour 87.84 89.74 1.90 

No. of claims in Bank's favour 10,384 9,425 -10.18 

% of claims in Bank's favour 12.16 10.26 -1.90 

Total 85,371 91,841 7.04


01. Quality 

Incidents in 2007 

78.3 

Complaints per million 

transactions 

25 

The purpose of the Customer Service Office is 

to deal with and resolve complaints and 

claims, ensuring, in an appropriate and 

timely manner, that there is a consistent 

approach. 

Incidents per million transactions 

100 

90 

80 

70 

External Customer Ombudsman 

2006 2007 07/06 (%) 

Claims processed 509 563 10.61 

Claims resolved in customer's favour 158 207 31.01 

Claims resolved in Bank's favour 350 350 0.00 

Claims excluded 1 6 500.00 

Bank of Spain 

2005 2006 2007 

Time taken to resolve financial claims 

Time taken No. of Claims % Attributable to Not attributable to 

Bankinter (%) Bankinter (%) 

0 days 51,347 55.91 99.72 0.28 

1-2 days 13,496 14.69 97.93 2.07 

3-10 days 16,821 18.32 93.50 6.50 

> 10 days 10,177 11.08 51.41 48.59 

2006 2007 07/06 (%) 

Claims resolved 120 112 -6.67 

Claims resolved in customer's favour 32 33 3.13 

Complaints accepted 4 23 475.00 

In the Bank's favour 42 25 -40.48 

Pending resolution 42 30 -28.57 

Outside Bank of Spain jurisdiction 0 1



Taking action to improve quality 

With the aim of raising the quality of service, Bankinter’s employees propose 

improvements throughout the year. In 2007, 96 improvement projects were 

started with the participation of 240 people, i.e. 5.3% of the Bank’s workforce. 

Seeking to recognise the joint effort made by the areas of the Bank 

that improved their scores most in the 2007 ISN surveys, the following awards 

were made: 

Territorial organisations with the best performance in terms of customer 

satisfaction and compared with the market in their geographical area: Tenerife 

Organisation, North West Organisation and Castile Organisation. 

Business Areas with the best performance in terms of internal and external 

customer satisfaction: Corporate Banking Division and Private Banking Division. 

Central Services with the best performance in terms of internal customer 

satisfaction: Treasury and Capital Markets, Printing Department, Products 

Division and Marketing Division. 

Lastly, three members of staff received ‘Awards for Service Excellence’ in 2007: 

Diego Lázaro González, Paloma Martínez de Aguilar, Ernesto Argudo Zamora.


29 

In what is known as the 'information society', 

the technological strength of a company 

becomes a differentiating variable. 

Technology continues to be one of 

Bankinter's strategic pillars. Over the past 

year investment was particularly strong 

in two specific spheres: the enhancements 

of knowledge management within 

the Bank and the projects relating to the 

private banking divisions. 

02 

Technology 


> Technology 

> IT security


02. Technology 30 

Bankinter mainly applies its technological 

strength, to raising the quality of the 

services and products used by customers. 

Technology 

Investment in technology continues to be one of Bankinter's strategic pillars, 

something that is especially valuable in a world in which this variable plays an 

increasingly important role in the information society. 

Bankinter mainly applies its technological strength to raising the quality of 

the services and products used by customers. 

Over the past year investment was particularly strong in everything to do 

with enhancing knowledge management within the Bank. A notable boost was 

also given to all of the projects concerning one of Bankinter's strategic areas of 

focus for 2007: Private Banking. 

Also in 2007 Bankinter incorporated into its Internet services the most 

advanced technologies represented by the world of Web 2.0, making them 

compatible with the Bank's strategy in favour of web accessibility, an option which 

has enabled groups of people with disabilities to deal with the Bank using the 

Internet on equal terms with other customers. 

Worth highlighting is the special project undertaken by Bankinter with the 

aim, on the one hand, of automating all of the Bank's official information and the 

medium on which it is held; and, on the other, of developing an ergonomic and 

functional IT support that will permit proper control and monitoring of operations 

in the Operating Control Areas. This project has involved an important change in 

the philosophy of the Bank's applications, so much so that it has modified the 

generation, management and utilisation of all of the information, making it more 

versatile and incorporating new functionalities called for by the Business areas. 

In 2007 the Bank also made substantial investments in the systems 

necessary for accession to Basel II, as well as in improvements to its internal 

management systems. 

A final mention should be made of the successful completion of the 

updating of the Treasury business platform.



31 

Details of investment in development 

Investment in 2007 36,457,583 

In-house investment 8,983,567 

External cost 21,000,000 

Activation 6,474,016 

Response time performance (in seconds) 

Internet Teleprocessing 

1.9 

2007 

2.2 

2006 

2 

2005 

0.2 

2007 

0.3 

2006 

0.4 

2005



Value 

Customer 

Processes 

Infra. 

Operating 

excellence 

External 

Internal 

1 

IT security 

Strategic IT Security Plan 

Conscious of the important commitment to service and quality, and of the 

continuous evolution of the technology the Bank uses in its dealings with 

customers, a project was begun by the IT Security department in 2007 - which will 

be completed during 2008 - for the purpose of formalising the Bank's Strategic 

Security Plan. 

Optimising 

costs 

9 

Responding to 

internal needs 

promptly, cost-effectively 

and with quality 

13 

Designing solutions 

promptly, 

cost-effectively 

and with quality 

14 

15 

Selecting 

the best 

technology 

Analysing 

and 

monitoring 

trends 

Risk 

management 

Optimising 

operating 

procedures 

16 

Analysing 

and managing 

risks 

Regulatory 

compliance 

2 3 

4 5 

10 

17 

Aligning with 

standards 

18 

Security 

in DLC 

6 

Managing 

risk 

efficiently 

Minimising 

losses due to 

incidents 

Handling 

incidents 

efficiently 

19 

Minimising 

costs due to 

penalties 

7 

Obtaining 

international 

certifications 

11 

Ensuring 

the reliability 

of the IT services 

Handling 

incidents 

efficiently 

20 

Constant 

monitoring of 

security 

Image 

creation 

Becoming a 

benchmark 

for the sector 

Promoting 

an image 

of security 

Periodic 

reviews and 

audits 

SUPPLY DISTRIBUTION IMPL./DEV. OPERATIONS MAINT. 

24 

Selecting 

internal 

25 

Instructing, 

training 

26 

Managing 

projects 

27 

Observatories 

and collabora- 

28 

Gearing 

operating 

and external and raising 

tion with other procedures 

resources awareness 

institutions to processes 

12 

22 

8 

Complying with 

the regulatory 

framework 

21 

Identifying 

opportunities for 

improvement 

23 

Regulatory 

compliance



33 

Bankinter is the first financial institution in 

Spain to be certified as ISO 27001 compliant. 

This plan has been designed using techniques and models of strategic 

management that are widely recognised and disseminated by the most 

prestigious business schools, such as: DAFO analysis, Porter’s 5 forces adapted, 

reds analysis, strategic maps, etc., thereby enabling us to ensure that the Bank's 

strategy is aligned with its position in the field of security; and consequently to 

achieve the security objectives linked through Bankinter's mission, vision and 

corporate values and the Bank's Information Systems division. 

ISO 27001 Re-Certification 

October 2007 was the first anniversary of the ISO 27001 Certification of the Bank's 

Security Management System. Thanks to this milestone, Bankinter became the 

first financial institution so certified in Spain, evidencing the Bank's compliance 

with the highest standards of quality and professional rigour in managing the 

security of its computer platforms and systems. 

The next challenge was to be able to keep the certificate, by means of 

actions and tasks that made it possible to guarantee that the management system 

is kept alive and continually enhanced. For this purpose, the world-renowned 

British Standards Institution (BSI) performed the first of the annual re-certification 

reviews. The result of the procedure was that Bankinter, and more specifically its 

Security Management System, amply exceeded the requirements established, 

thereby demonstrating in an objective, clear, evident and visible manner the 

commitment of the Management and of the Bank itself to the Security 

Management System.



Customer security 

The concept of 'customer security' forms part of the Bank's strategy for protecting 

its customers. It rests on three basic pillars of security: information, protection 

and advice, together with the overall premise that customers must play an active 

role in their own self-protection. 

In 2007, the remote banking services of financial institutions experienced 

one of their worst years, as a result, above all, of the increasing spread of threats 

such as phishing, carding, and trojans designed specifically to obtain customers' 

Internet access and operating information by fraudulent means. 

Thanks to the experience acquired, the efforts and the investments made in 

previous years, and the implementation of a package of innovative protection, 

control and alert initiatives, the Bank acquitted itself well and came out of this 

situation strengthened, giving customers the peace of mind, security, comfort and 

reliability of operating through our remote banking service. 

Bankinter's security and protection systems are periodically audited by 

independent personnel of high standing, bringing confirmation year after year of 

the guarantees of security and reliability that have made Bankinter's remote 

banking service a benchmark in the sector.



35 

ISMS Forum Spain 

So far in Spain only a few organisations have set out on the road to a 'security 

management system’, and even fewer have dared to have it certified. For this 

reason and in accordance with its security strategy, Bankinter - together with a 

group of benchmark companies and entities in sectors such as energy, 

construction, telecommunications or distribution - launched an initiative called 

ISMS Forum Spain, of which the Bank is a founding partner. 

ISMS Forum Spain is a non-profit organisation whose main objective is to 

promote the development, knowledge and culture of 'Information Security' in 

Spain. Its vocation is to serve as an impartial forum for discussion and research 

where businesses, public authorities, universities and research centres can pool 

their respective experiences and their points of view on these matters and, in this 

way, be a point of reference for the knowledge, dissemination and promotion in 

Spain of Information Security.

03 

Channels 

& Networks 


> Multi-channel Banking 

> Distribution networks 

> CRM 

A bank with numerous formats 

and options available for dealings 

with its customers. 

At Bankinter customers can interact with the 

Bank any time and anywhere using the 

channel that is most convenient for them. 

The perfect interaction and efficient 

combination of all of them translate into a 

distinctive value proposal that increases the 

level of satisfaction of the customers.


37


03. Channels and Networks 38 

Multi-channel Banking 

Bankinter has made the multi-channel strategy one of its big competitive 

advantages; and it continues to strengthen this strategy. 

At Bankinter customers can interact with the Bank any time and anywhere 

using the channel that is most convenient for them. The combined use of each of 

them (Branch network, Telephone Platform, Bankinter.com, ATMs, mobile phone, 

etc.) means that the service provided reaches levels of perceived quality that 

make us market leaders. 

Further significant steps were taken in 2007 to integrate our commercial 

activity through the different channels. This is another area in which Bankinter 

has a competitive edge. And so, supported by the strength of our CRM, depending 

on the time, the product and customer preferences, one or another channel for 

dealings is used, maintaining a unique commercial coherence. This has enabled 

us to optimise commercial efficiency and multiply the number of contacts while 

containing costs. 

There were 1,331.1 million transactions in 2007, which was 19.9% more than 

in 2006; 68.8% of these transactions were carried out using remote channels, which 

gives an idea of how the multi-channel environment has transformed the Bank. 

Variation in transactions by channel (%) 

100 

80 

60 

40 

20 

0 

2000 2001 2002 2003 2004 2005 2006 2007 

Mobile phone Cards Internet Telephone Banking Electronic Banking 

Branches


03. Channels and Networks 

Transactions 

1,331 

million transactions 

68.8% 

of them performed 

using remote 

channels 

39 

Telephone Platform 

The business done using this channel in 2007, its 15th anniversary year, is 

mainly apparent from the number of calls handled: they totalled 7.4 million and 

54% of them were answered by the automatic system and the remaining 46% by 

a personal manager. 

The number of e-mail messages handled totalled 73,050. 

There were several service reorganisations during the year involving the 

grouping together of some of them, primarily with a view to achieving greater 

efficiency and higher perceived quality. 

The training of the workforce staffing this channel is an essential factor. 

This is embodied in the intensive efforts made over the past year in which 

18,318 hours of training were given to 188 members of staff, representing 

96.9% of the workforce. 

The Telephone Platform once again displayed an optimum standard of 

operation, with 89.2% of the calls received being answered within 20 seconds. 

This translates into the quality perceived by our customers, who awarded it an 

aggregate score of 79.4 ISN (Net Satisfaction Index) points during the year. 

The market similarly singled out the quality of our platform. By the end 

of the year we had received two prizes, awarded by IZO Systems (the leading 

consultants in the Call Centre industry), the Spanish Association of Experts in 

Customer Call Centres, AEECCC (the sector business association) and the 

International Faculty for Executives, IFAES. One of them describes us as the 

'best call centre service in the banking sector', and the other was for the 'best 

people management in an overall context of call centre services'.



TSF quality ratio 

89.2% 

of the calls were 

answered in less than 20 

seconds 

79.4 

ISN points for quality 

The Internet continues to be the channel 

most used by the Bank's customers. More 

than 773,869 users performed 55% of the 

total transactions using this channel. 

Internet Platform 

The Internet continues to be the channel most used by the Bank's customers. 

This channel has 773,869 customers who perform more than 63.6 million 

transactions per month, representing 55.0% of the Bank's total transactions. In 

2007, the percentage of active users remained steady at 51.5% of total users. 

www.bankinter.com 

Work continued in 2007 on expanding the range of investment products, with 

the launch of the new individual systematic savings scheme - PIAS in Spanish - , 

improving the advice given to customers by the Investment Adviser tool and 

introducing new formats for dealings with the Bank with the launch of the new 

'Video call Service'. 

There was a marked increase in the number of log-ons to 3.5 million per 

month, which confirms the excellent perception that customers of the Private 

individuals segment have of the web as a channel for dealing with the Bank: its 

ISN score was 80.3 at year-end.



At any given 

minute of the day… 

24 hrs. 

34 

users 

connected 

3 remittances 

on average 

88 

transactions 

41 

empresas.bankinter.com 

New products and services were incorporated in the Bankinter for businesses 

website in 2007, including the 'Digital Invoice', which adds great technological 

and innovative value to the website. Our efforts were also focused on the 

development of new channels, such as video calls and mobile phones, which 

make it possible to reach customers in a more personalised and direct manner. 

Particularly noteworthy is the degree of maturity reached by services such 

as the online financing of foreign transactions, advances on invoices or even the 

possibility our customers have of issuing promissory notes with scanned 

signatures, which simplifies the formalities of this transaction. 

Due to the efforts made by the Bank in the SME segment, the website has 

become an essential tool used daily by our business customers, with constant 

growth in figures of use. We are supported by these pillars: quality of service, 

personalised advice and growth in the SME segment. In consequence, 72% of 

the Bank's active customers are also active or habitual customers of the website. 

As a result of all this, together with the big marketing efforts made, the 

website now has 116,134 registered business users, 64,000 of whom are active 

(both online and at the Bank) and perform transactions worth EUR 130,543 

million per year. These same active customers performed 223 million 

transactions during the year. 

To give readers an idea, at any given minute of the day or night, at any 

time of year, the following is happening on the Bankinter for businesses 

website: there are 34 users connected, who send 3 remittances and perform 88 

transactions. 

And this would make no sense if the quality was not up to the standard 

our customers deserve. Our scores here are high: 79.1 ISN points at year-end.



Transactions 

81% 

of all the Bank's equities 

transactions were 

performed using 

broker.bankinter. 

broker.bankinter.com 

In 2007 we expanded our range of products with the launch of Exchange Traded 

Funds. We also continued to focus our efforts on making Broker Bankinter an 

even more useful tool for our customers, if that is possible, by incorporating new 

Web 2.0 technologies that simplify operating and enquiry procedures. 

As a result, this website has become established as the customers' 

preferred channel for equities transactions. Specifically, it accounted for 81.0% 

of total transactions, with a steady rise in the number of transactions, as 

illustrated by the 98,433 transactions performed in the month of December. The 

picture is similar for log-ons to the website, amounting to 869,411 a month. 

Broker Bankinter continues to be a benchmark service in the financial 

sector. The attribute most highly valued by customers was the availability, 

which is a particularly sensitive factor in equities trading and achieved an ISN 

score of 84.0 As a result of this, the channel obtained an aggregate overall 

satisfaction score from users of 77.6 ISN points. 

SMS Platform 

The SMS platform offers substantial added value to customers, who perceive the 

availability and the immediacy of information as excellent attributes. Work was 

done in 2007 to improve all the flows of messages that customers receive; this 

contributed to achieving total figures of as many as 44.7 million messages sent, 

with 17.3% of the Bank's customers with a registered mobile phone active in this 

channel. As a result, the satisfaction indicators reached levels of excellence, 

with an ISN score of 83.1. 

Video Call Service 

In 2007 Bankinter launched a new channel for customer relations, the 'Video Call 

Service', which uses the possibilities of the Internet to offer interactive, 

multimedia advice that is personalised and specialised according to each need. 

With this service, any customer can contact the Bank, or vice versa, using an 

image and voice system that makes it possible to share documents, computer 

applications or web pages; this increases not only the capability of the advisory 

role but also the resolution of doubts or the remote commercialisation of complex 

products and services. 

The Video Call Service enables customers to get the best out of each 

traditional channel: the personal, specialised attention and extended business 

hours of telephone banking, the remote efficiency and immediacy of the Internet, 

and the proximity and the human touch of the branch office.




360 

non-specialised branches 

43 

Distribution networks 


At 2007 year-end, Bankinter had a network of 360 non-specialised branches, 28 

more than in 2006. This expansion of the Branch network was located in towns 

with faster-growing populations, whether local or European non-resident, and in 

areas where income levels, property development and greater economic activity 

mean that the investment will be recovered in the shortest possible time. 

The centres are staffed by a team of professionals (branch managers, 

assistant managers, account managers, executives, authorised officers and clerical 

staff) whose brief is to promote commercial activity in all the business segments 

under their responsibility. 

In order to support this sales team, to make their work easier and to 

improve the quality of customer service, the Bank continued to focus in 2007 on 

optimising the CRM tool as the basis for commercial activity at all the branches 

and centres. 

Mention should be made in this respect of both the management of 

potential customers and the synergies between segments to facilitate the addition 

of new customers. 

In line with the Social Action objective of participating in projects that 

improve the lives of the disadvantaged and help them in their daily activities, we 

continued to develop the 'branch office accessibility' project, the aim of which is 

for all the Bank's premises, particularly those that are open to the public, to be 

equipped with all types of physical accessibility requirements for handicapped 

persons in 2008. By the end of 2007, 94% of the branches, a total of 340, were 

already equipped with these measures.



Work also began in 2007 to adapt the frontages of the branches to the 

requirements of Bankinter's new corporate identity. At year-end 27.5% 

- 99 branches - had been adapted to the new brand image. 

Apart from this network of 360 traditional branches, Bankinter also has a 

large team of specialists in various customer segments working at a number of 

clearly differentiated centres: 

SME Centres. To increase our presence in the strategic SME segment continued to 

be one of our priorities. Accordingly, a further 37 new centres were opened, 

mainly located in industrial complexes where there is a high density of small and 

medium-sized enterprises. At 2007 year-end, Bankinter had a network of 161 

SME Centres distributed among the 13 territorial organisations that comprise the 

Bank, with a total headcount of 466 employees. 

Private Banking Centres. The number of these Centres, exclusively dedicated to 

taking comprehensive, personalised care of the customers in the Private Banking 

and Personal Finance segments, was 47 at year-end, with a staff consisting of 219 

highly-qualified professionals. 

Business Management Centres. The Bank currently has 51 Business 

Management Centres, staffed by a total of 237 professionals. These are centres 

where larger companies and big corporations receive specialised commercial 

services. 

Branch Network highlights 

Non-specialised branches 

SME Centres 

Millions of euros 

Average funds 

Average loans and receivables 

Profit before tax 

ISN score 

2006 2007 07/06 (%) 

332 360 8.43 

124 161 29.84 

10,345.90 12,871.56 24.41 

27,243.05 31,904.04 17.11 

320.18 397.83 24.25 

77.55 77.46 -0.09



Networks with partners 

ISN score 

77.5 

Virtual banking 

79.6 

Agents network 

45 

Networks with Partners 

Networks with Partners is the business area comprising the activities of the 

Agents network and the Virtual branches. Both these networks share the objective 

of speeding up the growth of the business based on the same premises: 

The clear focus on managing and providing advice to customers in the Private 

Banking and Personal Finance segments. 

The obsession with quality. Realising that this is a crucial differentiating value, 

the agents and virtual branches have very high quality ratings within the Bank's 

networks and, consequently, in the market. The ISN score of Virtual Banking is 

77.5 points; and that of the Agents network, 79.6 points. 

The sharing with the partner –whether the latter be an Agent or a Virtual 

Branch– of the profit obtained. 

Networks with Partners is of increasing relative importance within 

Bankinter, thanks to the strength of the business of the agents and of the virtual 

branches. At 2007 year-end, this business had 10.5% of the Bank's customers, and 

accounted for 10% of the profit before tax, 14.2% of customer funds and 9.3% of 

lending of the networks overall. 

Realising that this is a crucial 

differentiating value, the agents and 

virtual branches have very high quality 

ratings within the Bank's networks.




Bankinter's Agents network ended another year as market leader in this model of 

distribution. 

This network, which was set up in 1992 as part of Bankinter’s strategic 

commitment to growth and profitability, is based on partnership between the 

Bank and professionals in the financial and advisory services field. Bankinter and 

the agent share the margins earned on financial transactions without incurring 

the structural costs of traditional branches. 

Bankinter is committed to the training and professional development of the 

agents, being aware of the importance of this variable in a business that bases its 

success on providing good advice. Separately from the general training schemes 

for agents (courses of initiation on the Bank's technological platforms and 

operating procedures, training in products and constant updating), specific 

training is being developed in all the MiFID-regulated advisory service products, 

so that the agents' qualification as advisers is a clear factor of differentiation. 

In addition, work continued on the task of segmenting the agents according 

to their activity, business volume and involvement with Bankinter, in order to 

introduce initiatives aimed at improving both earnings and the professional 

development of the agents themselves. 

The Agents network has a history of success and a promising future. It 

accounts for an increasing weight of the business and faces the challenges of the 

coming years with the certainty that it will maintain its firmly established 

leadership, uphold its standard of quality and accelerate its growth. 

Agents network highlights 



Average funds 



ISN score 

2006 2007 07/06 (%) 

1,003 996 -0.70% 

713.86 869.80 21.84% 

1,552.47 1,770.17 14.02% 

16.49 19.79 20.05% 

78.80 79.60 0.80



47 

Virtual branches 

Bankinter's Virtual Branches continue to represent a unique model of 

collaboration between a bank and another company, public agency or professional 

society or association. Through a Virtual Branch financial products and services 

are offered to the partner’s employees, members, customers and suppliers. 

Bankinter and its partner (company, professional society, association, etc.) 

co-manage the Branch. The Bank provides the capital, technology and financial 

products, while the partner provides access to the businesses and individuals with 

which it usually deals, with both of them sharing in the earnings generated by 

this business. 

The customers of the virtual branches continued to be the most satisfied of 

all the Bank's networks in 2007, with a net satisfaction index (ISN) score of 77.5 

points. One of the factors contributing to the high degree of satisfaction of virtual 

branch customers is the advice and personal attention they receive thanks to the 

Bank's remote service platforms and the knowledge and management possibilities 

offered by Bankinter's CRM. 

The development of the business in 2007 continued to expand. 25 new 

branches were opened, and the profit before taxes increased by 21.3% year 

on year. 

Virtual branches highlights 

Virtual branches 


Average funds 



ISN score 

2006 2007 07/06 (%) 

527 552 4.74% 

1,321.95 1,360.81 2.94% 

1,676.51 1,941.76 15.82% 

20.77 25.20 21.30% 

79.27 77.47 -1.80



Average funds 

Increase of 

34.2% 

on 2006 

Telephone Network 

The Telephone Network ended 2007 with a pre-tax profit of EUR 3.8 million, 

which was 9.7% more than at 2006 year-end. 

The average loans and receivables arranged with these customers 

amounted to EUR 238.2 million. As usual, mortgage loans comprised the largest 

portion of this item. 

The average funds (excluding intermediation) amounted to EUR 170.7 

million, which was 34.2% more than in 2006. The offerings of fixed rate deposits 

that have repeatedly been made available via the remote networks have 

undoubtedly contributed to the achievement of this increase. 

Equity securities deposits were up by 7.3% year on year. 

Telephone Network highlights 

Active customers 


Average funds 



ISN score 

2006 2007 07/06 (%) 

9,234 8,824 -4.44% 

127.23 170.67 34.15% 

231.72 238.17 2.78% 

3.44 3.78 9.68% 

73.49 73.62 0.13



Internet network 

77.8 

ISN score for quality 

49 

Internet Network 

The Internet Network, which comprises customers who sign up with the Bank 

through bankinter.com, ended 2007 with a pre-tax profit of EUR 10.0 million, 

which was 16.9% more than at 2006 year-end. 

This result is based particularly on the growth of the following captions: 

average funds (excluding intermediation), which amounted to EUR 395.2 million, 

62.3% more than in 2006; the nominal equities portfolio, with a 12.2% increase; 

and on the loans and receivables - based on home mortgage loans - which totalled 

EUR 959.9 million, an increase of 4.6%. 

The campaigns promoting high-rate deposits that were conducted during 

the year, together with the mortgage campaign, resulted in the addition of 14,332 

new customers, which was 8.7% more than in 2006. 

For customer management, efforts continued to encourage customers to use 

the logical channel for their profile, i.e. the Internet, in their dealings with the 

Bank, and to promote the use of all the financial services by mobile phone. All of 

this for a growing number of active customers and, in addition, with an 

improvement in quality to an ISN score of 77.8 points. 

Internet network highlights 

Active customers 


Average funds 



ISN score 

2006 2007 07/06 (%) 

25,092 26,752 6.61% 

243.47 395.16 62.30% 

917.92 959.90 4.57% 

8.52 9.96 16.90% 

77.42 77.81 0.39



CRM 

Customer Relationship Management (CRM) is one of Bankinter's principal 

strengths. 2007 brought enhancement of its capability as the tool that integrates 

and coordinates Bankinter's multi-channel banking structure, managing and 

personalising the commercial actions through all the channels: Branches, Agents, 

Virtual banking and Remote Sales, Internet, SMS and mobile phone banking, 

Mailing and E-Mailing; all in direct relationship with the business and products 

divisions of the Bank and its subsidiaries. 

During the year, progress was made in the CRM's capacity for prediction 

and knowledge, with the creation of advanced models of analysis that help us to 

predict the sequence of products that customers request according to their 

socioeconomic profile. This has enabled us to introduce strategies anticipating 

customers' needs, offering them advice, notifying them in certain situations and 

taking care of the treatment and the quality customers receive in each of the 

actions. 

CRM has drawn up a profile for each type of commercial action, whether 

it be for attracting new customers, diaries, communications and alerts, 

differentiating among them for each business division. In 2007, CRM handled 22 

million commercial actions: sending 10.9 million letters, 4.3 million e-mails and 

1.8 million text messages; in addition, 2.1 million actions were included in the 

diaries of the sales staff, and almost 3 million opportunities for sales online, by 

telephone or branch, were offered reactively. 

CRM communications (sum of communications) 

Private 

individuals 

Private 

banking 

SMEs 

Corporate 

banking 

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 

Customer attraction Alerts Diaries Reactivity



51 

CRM has also collaborated closely with Bankinter's Innovation area, contributing 

to the development and promotion of mobile phone use and incorporating 

commercial actions and personalised offerings - using text messages and 'Mobile 

phone banking' - just as customers are performing their transactions. CRM has 

also worked hand in hand with the Innovation area in its task of informing 

customers of the existence of the Video Call Service as a new channel for 

customer relations, and in the launch of commercial actions using this platform. 

All of the CRM activities have served to consolidate the Bank's prestige in 

the main European and American forums, showing how the integration of CRM 

with the sales platforms is a complete success in customer management. 

CRM communications by channel (sum of communications) 

Private 

individuals 

Private 

banking 

SMEs 

Corporate 

banking 

0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 

SMS E-mails Letters


53 

04 

Intellectual capital 

Intellectual capital is one of the most 

important assets when it comes to 

establishing the market value of businesses. 

Bankinter puts significant effort into 

managing its intangible assets: the talent of 

its staff, its corporate culture and the value 

of its relations with its stakeholders, 

paying particular attention to the 

measurement, comparison and subsequent 

publication of the data obtained. 


> Human Capital 

> Structural Capital 

> Relational Capital


04. Intellectual capital 54 

2007 

2006 

2005 


4,530 

employees 

Diversity 

51.8% 

men 

48.2% 

women 

Men Women 

51.8 48.2 

53.1 46.9 

55.0 45.0 

28 

employee nationalities 

2007 

2006 

2005 

Graduates 

72.6% 

Graduates 

72.6 

71.9 

70.7 

Spain, Germany, Belgium, Bulgaria, Brazil, Denmark, Finland, 

France, Holland, Ireland, Italy, Paraguay, Portugal, United Kingdom, 

Romania, Sweden, Switzerland, Argentina, Colombia, Cuba, China, 

Ecuador, United States, Peru, Russia, Uruguay, Venezuela.


04. Intellectual capital 

Employees who received 

training in 2007 

100% 

62.2 

training hours 

36 

average age 

55 

9 courses per 

employee 

1,384 courses 

taught in 2007 

474 

training actions 

9.6 

average years of service



The Bank began publishing its intellectual 

capital data eight years ago, and is now an 

established benchmark entity in this field of 

business management. 


In a world characterised by the technological revolution in communications and 

by increasingly rapid change, a company's success depends above all on 

intangible assets such as the talent of its staff, its corporate culture, or the value 

of its relations with customers, shareholders and suppliers, among other 

stakeholders. These assets are what lie behind a large part of the very marked 

difference there is in many cases between the market value of companies and the 

value reflected in their financial statements. 

Bankinter makes significant efforts to invest in and manage its intangible 

assets and, despite the difficulty involved, it pays special attention to their 

measurement. The Bank began publishing its intellectual capital data eight years 

ago, and is now an established benchmark entity in this field of business 

management. 

Bankinter's model of intellectual capital provides useful information for 

assessing its ability to create value. It is also an efficient management tool for 

optimising the contribution made by the Bank's intangible assets to its business 

strategy. The model's various indicators are arranged in three blocks of 

information (human, structural and relational capital), depending on the different 

nature of the intangible assets under consideration in each case. 

Human Capital 

This refers to the attitudes, skills and knowledge of employees and teams that 

provide value to the Organisation, and to the latter's ability to regenerate its 

human capital through training and learning. 

Bankinter has a workforce of professionals that is trained, motivated and 

fully committed to the objectives of the Organisation and its business model. The 

Bank's people management policy is designed to achieve the necessary alignment 

between the needs and expectations of the employees, those of the business, and 

a shared social responsibility.



57 

In 2007, there was once again a sizeable increase in the Bank's workforce, from 

3,981 in 2006 to 4,530 in 2007. Over the past six years, the total number of staff 

employed by the Bank has risen at a constant cumulative annual rate of 7%. 

During the same period, the number of new hires as a percentage of the total 

workforce each year rose from 6.0% in 2002, to 22.3% in 2007, with an external 

rotation index of 10.5% in 2007. These figures make Bankinter a leader in net job 

creation in the sector. In parallel, both the average age of the workforce and the 

length of service have fallen considerably, to under 36 and 10 years, respectively, 

in 2007. 

The indicators which measure the workforce's level of training (percentage 

of graduates, advanced language skills) and its diversity (on the basis of 

academic qualifications, sex and nationality) score very highly in comparison with 

the rest of the sector. 

In 2007, 100% of the staff received training (the training indicators are 

estimated on the basis of the average workforce). Each person trained received an 

average of 62.2 hours of training, with an investment of EUR 1,186 per person, 

representing an increase in the training effort per person of nearly 25% in 

comparison with 2006. The investment in training continued to represent 3% of 

the total payroll. 1,384 courses were given, relating to 474 different training 

actions, 17% of which are housed in the virtual classroom. 

More than half of the staff participate in stock and convertible debenture 

ownership programmes, and nearly 60% receive variable remuneration, which 

accounts for 13.5% of the total payroll. In 2007, 13.9% of the staff received some 

type of recognition and 12% participated in mentoring programmes. 

The results of the latest biennial work climate survey show a constant 

improvement in the workforce's satisfaction index over the past four years, 

reaching a score of 90 in 2007. The motivation index has remained at a steady 

83% since 2005. 81% of the workforce took part in this survey. The figures are 

indicative of their level of motivation and commitment.



Human Capital 

Indicator 2005 2006 2007 

Descriptive indicators 

No. of employees 3,712 3,981 4,530 

Average age (years) 36.59 36.50 35.95 

Experience 

Average length of service (years) 10.45 10.27 9.56 

Average length of service (years) as % of 40 years (professional lifetime) 26.13 25.68 23.90 

Diversity 

Breakdown by sex 

Men (%) 54.98 53.10 51.79 

Women (%) 45.02 46.90 48.21 

Graduates (%) 70.69 71.94 72.56 

Employees with advanced English language skills (%) 40.38 39.56 35.41 

Number of nationalities represented 16 23 28 

Number of different qualifications 92 95 89 

% of workforce holding the 3 most common qualifications at Bankinter (%) 43.91 42.68 42.94 

Ability and development 

Employees who have received training (%) 100.00 100.00 100.00 

Average number of training hours per employee as % of 350 (average post-grad. course load) 29 16 18 

Average number of training hours per employee 100.24 56.91 62.17 

Average number of training hours per employee trained 66.69 56.45 58.66 

Investment in training as % of total payroll 3 3 3 

Investment in training per employee (euros) 1,852 1,027 1,257 

Investment in training per employee trained (euros) 1,232 1,019 1,186 

Employees with access to Virtual Classroom from their workstation (%) 100 100 100 

Training actions in Virtual Classroom as % of total different training initiatives 19.02 18.50 17.09 

No. of different training actions 389 400 474 

Average no. of courses per employee 12 8 9 

Total no. of courses taught 1,182 1,121 1,384 

Index of application of training in the job performed (%) 100 100 100



Human capital (cont.) 

59 

Indicator 2005 2006 2007 

Commitment and motivation 

Employees participating in stock and convertible debenture ownership programmes (%) 68.24 62.72 55.39 

Satisfaction Index 85 N/A 90 

Motivation index (%) 83 N/A 83 

Participation in opinion poll (%) 71.4 N/A 81 

External rotation index (%) 7.03 9.74 10.53 

Employees participating in Quality Projects and Initiatives as % of total headcount 22.36 7.54 5.30 

Employees participating in Debating Forums as % of total headcount 48.71 43.26 39.03 

Employees with variable compensation (%) 65.98 68.70 59.93 

Employees who have received awards (%) 73.55 78.80 72.60 

Recognition index (%) 19.64 21.60 13.97 

Variable compensation as % of total payroll 14.55 14.45 13.51 

New hires in the past year as % of total workforce 18.59 16.18 22.38 

% of employees who meet or exceed their targets 89.91 89.84 85.16 

Personnel expenses (thousands of euros) 192,398 227,336 298,294 

No. of contributions to knowledge communities 2,740 2,456 2,181 

No. of suggestions for improvements 932 734 413 

% of employees receiving individual mentoring 10 10 12 

% of employees acting as mentors 3 3 3 

Value creation (thousands of euros) 

PBT/No. of employees 71.51 79.46 106.94 

Contribution to GDP per employee 149.57 166.36 185.27 

Productivity (thousands of euros) 

Customer funds per employee 7,402 8,210 8,559 

Loans and receivables per employee 7,042 7,951 8,296



Internal job rotation 

30% 

In 2007 

Structural Capital 

Structural capital is defined as the value of the internal systems and of the 

corporate structure and culture. It is the knowledge that the Organisation 

succeeds in specifying, systematising and internalising in its individuals and 

teams. Sound structural capital facilitates a better flow of knowledge and leads to 

the increased efficiency of the Organisation. 

For Bankinter it is very important to develop appropriate cultural values to 

fulfil its strategy that are shared and accepted by the Organisation as a whole. 

The intensive use of the new information and communication technologies, the 

efforts dedicated to the processes of innovation, flexibility and the maximum 

availability of information relevant to management are elements that are fully 

integrated into Bankinter's signs of identity. Thus, virtually all of the 

management information (96%) is available to all of the staff and 100% of the 

employees know the Organisation's objectives. 

A total of 4,165 members of staff participate in 360º performance 

evaluation, with an average of 11 evaluators per employee evaluated. 81 people 

evaluated the members of the Management Committee. The indicator relating to 

the implementation of employees’ suggestions has shown a substantial 

improvement over the past year.



Structural Capital 

61 

Indicator 2005 2006 2007 

Management and strategic management 

% of hierarchical levels involved in preparing the Group’s strategic plans 35 33 29 

% of employees who know the Bank’s objectives 100 100 100 

% of management information available to all employees 96.70 96.45 96.61 

Delayering and transparency 

Number of people participating in 360° evaluation 3,432 3,874 4,165 

Average number of evaluators per employee evaluated (applications sent / total headcount evaluated) 

Average number of persons evaluating each Management Committee member 

10 11 11 

(applications sent / Management Committee members) 73.12 75.80 81.00 

Flexibility 

Internal job rotation (%) 29.01 34.46 29.95 

% of employees who have logged on remotely 54.20 38.46 35.70 

No. of remote log-ons 159,006 104,546 141,443 

Time logged on remotely per user (min) 20,710 10,757 11,963 

Employees accessing the Internet daily from the Bank’s platform (%) 70.35 61.97 69.65 

Employee suggestions implemented (per thousand) 34.63 24.91 75.71 

Technology and process quality 

% of employees with intranet access 100 100 100 

Employees contributing to development and maintenance of intranet content 84 104 146 

% of employees with access to e-mail 100 100 100 

MIPs at central host/ Workforce 0.73 0.88 0.97 

Daily e-mail traffic (daily average in a 7-day week) 239,466 336,690 375,536 

Number of quality projects and initiatives carried out 389 141 96 

Number of prize-winning quality projects and initiatives 10 10 10 

% of branches with Internet stations & telephones connected to the Telephone Banking platform 100 100 100



Relational Capital 

Indicator 2005 2006 2007 

Customer Relations 

No. of non-specialised and foreign branches 318 332 360 

No. of virtual branches 498 527 552 

No. of Bankinter Agents 1,007 1,003 996 

Number of SME Management Centres 105 124 161 

No. of Business Management Centres 45 50 51 

No. of Private Banking Management and Financial Advisory Centres 37 41 47 

Employees per Branch or Management Centre 7.35 7.28 7.32 

Staff directly involved in the business (%) 74.46 74.13 74.83 

New active customers (%) 13.55 14.46 12.57 

Annual growth in Average Total Assets (%) 31.64 17.51 11.24 

New active customers per employee 22 24 21 

Quality and customer satisfaction 

% of financial incidents resolved in 48 hours 83.95 81.81 70.6 

Number of complaints to Ombudsman per active customer for every 10,000 customers 9.81 7.55 7.56 

No. of complaints processed by Bank of Spain per active customer for every 10,000 customers 2.02 1.78 1.50 

Multi-channel banking development 

Relational Capital 

Relational capital refers to the value for an enterprise of its interactions with the 

outside world: customers, suppliers, social partners, etc. 

Bankinter combines a multi-network and multi-channel distribution 

strategy with a high level of technological integration, enabling it to offer 

customers a wide range of options for dealing with the Bank. The transactions 

performed using channels other than the branch network accounted for nearly 

70% of the total transactions at the Bank, with online transactions through 

Bankinter.com accounting for 55%. In particular, the equities business performed 

through the Internet now accounts for more than 80% of the total transactions. 

The Bank attracts 39.1% of its new customers through channels other than the 

branch network. 

Transactions through channels other than Branch Network as % of total Bank transactions 67.46 68.67 68.84 

New customers attracted through channels other than Branch Network as % of total new customers 41.80 47.19 39.10



Relational Capital (cont.) 

63 

Indicator 2005 2006 2007 

Telephone Platform 

Calls answered by Telephone Platform / staff 

Enquiries and incidents reported to Telephone Banking handled by e-mail/ 

2,114 1,894 1,608 

Telephone Banking staff 263 274 210 

Active Telephone Banking users as % of total active customers 65.05 67.10 68.89 

Transactions through Telephone Banking as % of total Bank transactions 7.46 6.90 6.00 

Calls handled by automatic service (%) 56.63 55.95 54.16 

Agents Network & Virtual Banking 

% growth in number of Virtual Banking customers 

Virtual Banking transactions through channels other than Branch Network 

5.45 6.10 4.83 

as % of total Virtual Banking customer transactions 98.70 98.87 98.93 

% growth in number of Agents Network customers 

Agents Network transactions through channels other than Branch Network 

9.40 11.84 

as % of total Agents Network customer transactions 97.78 97.15 96.76 

Internet 

Internet customers as % of total customers 26.97 27.28 27.20 

Transactions through Bankinter Internet as % of Bank total 51.94 53.71 55 

Internet log-ons per active user 96.29 104.6 107.86 

Equity securities activity through Broker Bankinter (%) 75 78.46 80.97 

New customers signed up by Internet as % of total new customers signed up by the Bank 17 16.29 15.19 

Shareholder and Investor Relations 

Channels available to shareholders & investors 9 9 9 

No. of publications aimed at shareholders & investors 33 24 19 

Support for Education, Culture & Innovation 

Alliances and collaboration projects with academic and research institutions 63 66 73 

No. of lectures organised by Fundación de la Innovación Bankinter 14 11 10 

No. of experts participating in the forums organised by the Fundación de la Innovación Bankinter 133 148 183 

Environment 

No. of environmental projects 

Training & communication actions aimed at optimizing consumption in the workplace 

6 10 11 

and achieving responsible management of resources 7 11 12 

Brand awareness 

Awards or public recognitions received by Bankinter 

Positive and neutral assessments made in reports on Bankinter in the media 

18 21 18 

in the target market (%) 88.92 97.61 95.28 

Social action 

No. of agreements reached to include people with disabilities on the staff 5 5 6

05 

People 

and knowledge management 


> Our value, our values 

> Bankinter, a great place to work 

> People management 

> Recognition 2007 

4,530 people doing their job enthusiastically 

in one of the best places to work. 

People are the Bank's prime asset. 

Bankinter offers its employees working 

conditions and possibilities for personal 

and professional development that enable 

them to make the most of their qualities 

and fulfil all of their potential.


65


05. People and knowledge management 66 

Our value, our values 

The people who work at Bankinter are the Bank's prime asset. Their talent, the 

investment in technology and the constant spirit of innovation within the 

Organisation form a unique combination which is what gives the Bank its 

competitive edge: quality of service and distinctive financial products, with high 

added value. 

The People and Knowledge Management Area at Bankinter puts effort into 

also making the Bank a different and unique place in which to develop a 

professional career. A bank which offers its employees working conditions and 

opportunities for personal and professional development that enable them to 

make the most of their qualities and fulfil all of their potential. The area's goal is 

to make the Bank's objectives a reality and to look after its corporate culture, a 

culture that is open and non-hierarchical and has as its own distinctive values the 

promotion of talent and intellectual capital; the guarantee of an unrestricted, 

creative and motivating working environment; and the transparency of the Bank's 

information. 

The Bankinter Group Code of Professional Ethics refers explicitly to these 

values that define the Bank's corporate culture together with the commitment to 

quality, good corporate governance, social responsibility and the creation of value 

in the long term for the shareholders, the employees, the company, the customers 

and society as a whole. 

This code, which was updated in 2007 and approved by the Bank's Board of 

Directors, sets out the basic principles governing the actions and the practices 

of professional conduct for all the employees and people who work for the Bank, 

principles that have a direct impact on Bankinter's people management policy. 

The revised Code includes the general principles of non-discrimination and equal 

opportunities, work-life balance, respect of employees' right to privacy and the 

promotion of health and safety at work. It also includes specific provisions 

relating to staff recruitment, assessment and professional development policies. 

The policies applied by the People and Knowledge Management Area have 

these corporate principles and values as their framework and pursue a common 

strategic approach: to enable the Bank to achieve the maximum effectiveness of 

its potential as a high performance organisation. To do this a people management 

model is applied that focuses on the motivation and commitment of the people 

working at Bankinter and results in a positive impact on the income statement 

and, consequently, on the share value. These policies seek to foster an 

environment that facilitates and motivates such commitment.


05. People and knowledge management 

67 

Bankinter, a great place to work 

After four consecutive years of recognition by the Great Place to Work Institute 

Spain as one of the best working environments, in 2007 Bankinter was named by 

the Institute as the 6th best place to work in Spain and the number one in the 

financial sector. 

According to GPTW's definition of an excellent working environment, 

Bankinter is a place where ‘you can have confidence in the people you work for, 

feel proud of what you do, and enjoy the company of those you work with.’ 

In 2007 Bankinter was also rated as a ‘Top Employer ’07’. This rating or 

quality label is awarded by CRF (www.crf.com), an international organisation 

specialising in employer branding that conducts research into the best employer 

practices in different European countries. To do this it has the support and advice 

of prestigious partners such as Hay Group, Karriere, The Guardian, Hewitt, 

Mercer, AT Kearney, VNU, PricewaterhouseCoopers, Deloitte and Accenture, 

among others, and of academic experts in new trends in business management 

and organisation. The research analyses aspects of the organisations such as 

working atmosphere and culture, employment conditions, talent development, 

commitment to society and emphasis on innovation. 

Bankinter achieved the highest overall score out of all the financial entities 

considered in the research, and obtained particularly high scores in working 

conditions (contract and pay, flexible hours and work-life balance measures) and 

emphasis on innovation (knowledge management, support for universities, 

innovative workforce and technology).



People management 

The actions undertaken by the People and Knowledge Management Area take the 

form of a variety of measures and initiatives to do with staff recruitment, 

employee training and professional development, talent management, work-life 

balance and the improvement of the occupational health and safety conditions, 

among others. 

Respect for employees' rights and interests 

The Bankinter Group guarantees the effective exercise of the rights of 

unionisation, association and collective bargaining, as well as the right to 

privacy in the legally established terms and in accordance with the specific 

provisions laid down to this end in the Bank's Code of Professional Ethics. 

It handles everything to do with employees' personal, medical and financial 

details with due confidentiality. It also respects the personal communications of 

its employees via the Internet and any other means of communication. 

The Bank is sensitive to the personal circumstances and needs of its 

employees. In this respect it shows the utmost care and consideration and a 

genuine interest in providing solutions that are compatible with the needs of the 

business. To assist employees in achieving a balance between their personal and 

family life and their responsibilities at work, a variety of measures have been 

adopted, connected with: 

- Arrangements for flexible working hours. 

- Care and attention of family members. 

- Maternity/paternity arrangements. 

- Arrangements for long-term contingencies. 

- Arrangements for training and professional development. 

- Arrangements for activities in favour of the underprivileged. 

- Personal rest period arrangements. 

- Response to mobbing. 

- Response to situations of gender-based violence. 

The Bank has specific bodies for participation and communication on which 

the employees are represented in order to guarantee the achievement of optimum 

conditions of health and safety at work. The Bank carries out risk assessments at 

its workplaces and has in place a programme of specific training on health and 

occupational hazard prevention for the whole workforce.



New hires 2007 

1,014 

people 

69 

New hires 

2007 saw the continuation of the efforts of previous years to attract and hire the 

best professionals, with a total of 1,014 new hires in the year. A large number of 

applications were processed through the corporate website and, under the banner 

'If you think that all banks are the same, we want to meet you', numerous 

presentations on the Bank's employment offering were organised at universities 

and business schools throughout Spain. Staff from the People and Knowledge 

Management Area participate in these presentations with the active collaboration 

of the Bank's management team. 

With these procedures the Bank is looking for young people with university 

degrees and advanced language skills. The most highly rated personal qualities 

are: innovative talent, creativity, determination, dynamism, imagination, 

tenacity, the urge to grow and learn, eagerness to better oneself and the ability to 

work in a team. The selection is based exclusively on the academic, personal and 

professional merit of the candidates and the requirements of the Bank. The 

selection procedures consist of two phases: an aptitude test and a personal 

interview. Approximately 6% of the people who apply for a job at Bankinter are 

successful. After they have been hired by the Bank, new employees participate in 

a specific training and mentoring programme.



Bankinter aims to become a banking 

benchmark for training, the bank that sets 

the model to be followed. 

Training 

The training of all its employees is one of the Bank's strategic investments: 

Bankinter aims to become a banking benchmark for training, the bank that sets 

the model to be followed. The Bank's training scheme is consistent with a model 

of management by competencies supported by a knowledge map that details 

abilities, skills, functional profiles and knowledge required in the different jobs 

within the Organisation. This management model makes it possible to know what 

the Bank expects of each of its employees, and also serves as a personalised guide 

for their training and professional development. In this way it is possible to 

design continuing training actions that are adapted both to the needs of the 

business and to the needs and development expectations of each individual. 

The training provided is flexible, open and adaptable to the different 

personal profiles, business areas, specialisations and interests. It combines both 

classroom learning and distance education through e-learning. Its content is 

aimed both at enhancing the performance of staff in their current jobs and 

preparing them for internal promotion and for discharging future responsibilities 

in other jobs within the organisation, thereby contributing also to improving their 

employability.



71 

Transparency in communication and information 

All of the information on the training procedures is accessible via the Bank's 

intranet ('People Website'), where employees can consult their personalised 

training plan or the profile of competencies and knowledge required for each job. 

Staff can use the Bank's intranet to exchange experiences and knowledge and to 

make suggestions for improvement, an activity which the Bank promotes by 

means of competitions. 

The 'People Website' has received recognition from numerous external 

sources. It provides employees with information on work-life balance measures, 

with training on occupational hazard prevention or on the Bank's social action, 

among many other issues, and enables them to perform a wide variety of 

operations by making use of its various applications. In addition to being a 

combined means of communication and administration/management, it is a 

fundamental tool for dialogue and participation at the Bank. 

Bankinter employees enjoy freedom and complete independence when 

doing their job and in their dealings with customers. The most significant 

financial, commercial and administrative information – including that used by the 

directors and the executive team – is available to most of the employees. The 

Bank’s databases are open to the workforce and internal communication is 

designed as a model that is unrestricted by reason of rank or function, with a 

completely direct and fluid relationship between managers and staff. 

Visits by users, annual 

2006 2007 

People Website 36,060 45,649 

Intranet 48,343 62,938



Talent management 

The Bank promotes full professional progression, based on merit as the criterion 

of development and on the active management of talent within the Organisation. 

Talent management has a strategic value for Bankinter, and is the Bank's 

principal driver of change and differentiation in the medium term. In a 

competitive market, where size, mergers and acquisitions are what shape the 

strategy of some banks, Bankinter's competitive edge rests ultimately on its 

ability to attract, make visible and develop the talent of its people. 

Having identified the individuals with talent, especially among the younger 

members of staff who are in the initial stages of their career at the Bank, 

training, rotation and promotion policies are designed in line with their specific 

needs, so that they can acquire the necessary expertise for a successful 

professional career. These people are monitored closely and individually by the 

People and Knowledge Management Area in collaboration with their line 

managers. At present 572 individuals form part of the talent management 

programme, most of whom are young people with the potential to reach more 

senior positions of greater responsibility. 

Their situation in the programme is reviewed annually and their 

professional development is monitored individually. 

Indicator Persons identified Persons identified Total workforce 

with Talent with Potential 

Internal job rotation (%) 28.24 38.46 26.40 

Promotions (%) 20.61 24.31 7.43



73 

Motivation and pay 

At Bankinter, employees are a priority. A portion of the share capital is held by 

the workforce, thus making them both jointly responsible for and partners in the 

results of a shared venture. 

Employees are rewarded for their talent and also for their commitment to 

the Organisation. Variable remuneration tied to result targets and performance is 

implemented throughout the Bank, as befits a decentralised organisation that has 

freedom to negotiate with customers and delegation as its basic principles of 

operation. This pay policy makes it possible to acknowledge and properly reward 

the achievement of the targets set and also seeks to be flexible, fair and in line 

with the functions and responsibilities discharged. 

Improvements were made to the system of variable remuneration in 2007 

that increase the benefit and decrease any possible loss. A model of flexible 

remuneration was also introduced for the whole workforce.



Recognition 2007 

A. Fernando Carrasco Ortega, Ada 

Maqueda Perez, Adela Martin Ruiz, Adelaida Adanez 

Lerma, Adolfo Arias Urrutia, Adriana C. Cossio Acha, Agustin Soto 

Gonzalez, Alberto Ballestero Loreto, Alberto Carmona Alonso, Alejandro 

Arribas Ramos, Alfonso Alvaro Cid De River, Alfonso De Miguel Martin, Alicia 

Antequera Perez, Amaya Peciña Hipolito, Amy Unger Martin, Ana Belen Gonzalez Ballesteros, 

Ana Belen Lopez Cuesta, Ana Belen Martinez Cabezon, Ana Belen Merino Rodriguez, Ana Cristina 

Arellano Sorribas, Ana Cristina Hervas Ruiz, Ana Hernanz Dominguez, Ana Isabel Mtnez-Grande Diaz, Ana 

Isabel Ortiz Vivanco Soto, Ana Lopez Olalde, Ana Maria Cladera Bibiloni, Ana Maria Martinez Salas, Ana Maria 

Tejero Fdez-Montes, Ana Nieto Alonso, Ana Prieto Temez, Ana Victoria Carro Hurtado, Angel Contreras Santos, Angel 

David Marin Bertolin, Angel Gomez Garcia, Angel Gonzalez Dominguez, Angel Gonzalez Miragaya, Angel Llamas Llamas, 

Angel Lopez Lavin, Angel Manuel Aguilar Bejar, Anselmo Borrego Alcaide, Antonio Amoros Gomez, Antonio Fco.Fernandez 

Lopez, Antonio Gonzalez Suarez, Antonio Juan Santana Diaz, Antonio Martin Franco, Antonio Mas Segura, Antonio Mateos 

Segura, Antonio Montesinos Caracena, Antonio Pedro Martinez Andreu, Antonio Piqueras Martinez, Antonio Rodriguez Aguilar, 

Antonio Timon Gonzalez, Araceli Amoros Rodriguez, Arturo Gamarra Blas, Arturo Jose Martin De Llanos, Arturo Lozano Gomez, Barbara 

Lopez Molina, Beatriz Garcia Gonzalez, Beatriz Naranjo Martín, Beatriz Torres Piñeyro, Benjamin Rios Lopez, Bernabe Marcelino Borges, 

Borja Maldonado Maese, Carla Martinon Moreno, Carlos A. Marchan Burriel, Carlos Jesus Tabuenca, Carlos Molina Garcia, Carlos Nuñez 

Montesinos, Carlota Aldea Casado, Carmen Casado Sola, Carmen Maria Rodriguez Segovia, Carolina Sanchez Oltra, Catalina A. Diaz Rodriguez, 

Cesar Eduardo Labarta Velez, Cesar Gil Villanueva, Claro Mendoza Diaz, Claudio Arevalo Garcia, Concepcion Gomez De La Rosa, Conrado A. Rguez- 

Lopez Garabote, Coral Lopez Carmona, Covadonga Ana Perez Goicoechea, Crettel Tagarro Villa, Cristina Baeza Sanchez, Cristina Martin Garcia, 

Daniel Andres Perez, Daniel Sanchez Gandara, David Casal Andres, David Galan Ramirez, David Garcia Baño, David Garcia Moral, David Larger 

Martinez, David Lopez Finistrosa, David Salomon Ruiz, Diego Lorenzo Agapito Mera, Dimas Blanco Muñoz, Domingo Jesus Yanes Carrillo, Domingo 

Merchan Villaron, Domingo Tomas Vera Gomez, Elena Portela Garcia, Elena Santos Gonzalez, Elena Usero Rebollo, Eloi Torrent Jaume, Emilio Manuel 

Cremades Rey, Emilio Olloqui Sariego, Emma Teresa Fuentes Ohnell, Enrique Cires Valdes, Enrique Garcia De Francisco, Ernesto J.Martinez Sanchez, 

Ernesto Vicente Lahoz, Estefania Perez Marquez, Esther Arce Arancheta, Esther Delgado Sanchez, Esther Montoya Carrasco, Eusebio Sevilla Osma, Eva 

Font Puig, Eva Garzon Liebana, Eva Isabel Guisado Garcia, Eva Mayo Gomez, Fayna Sanjuan Mc Nulty, Fco Javier Garcia Gomez, Fco Javier Hurtado 

Huerta, Fco. De Paula Crespo Garcia, Fco. Javier Capon Ruiz, Fco. Javier De Ramon Casado, Fco. Javier Larrañaga Ces, Fco. Javier Perez Helguera, Fco. 

Javier Rey Lopez, Fco. Jose Figueroa Figueroa, Fco. Manuel Gutierrez Cuevas, Fdo. Vicente Rodriguez Sanso, Federico Serrano Casellas, Felix Prieto Rodero, 

Fernando De Pablo Martinez, Fernando Gallegos Tejero, Fernando Martinez Martinez, Fernando Martinez Nueda, Fernando Medina Revuelta, Fernando 

Murciano Muñoz, Fernando Rey Navarro, Fernando Salido Castillo, Fidel Sierra Herreria, Francisca Martinez Sanchez, Francisco Fernandez Paredes, 

Francisco Gimenez Orcajada, Francisco M. Maellas Garcia, Francisco Marcos Franco Sarab, Francisco Martinez Garcia, Francisco Moreno Moreno, Gema 

Maria Cordero Baile, Gema Tapia Guerrero, German Ruiz Martin, Gregorio Hernandez Garcia, Guillermo Gomez-Zarzuela Giner, Guillermo Lopez-Tapia 

Guzman, Heriberto Arias Gonzalez, Ignacio Estrada Fdz-Hontoria, Ignacio Fernandez Osa, Ines Ramos Rodriguez,Inmaculada Cano Sanchez, Inmaculada 

M Rodriguez Rodriguez, Iñigo Guerra Azcona, Iñigo Lopez Villanueva, Isabel Alonso Matey, Isabel Pelaez Garcia, Isabel Sanchez Barbero, Itziar Sagarna 

Comenge, Jaime A.Delgado Peris, Jaime Hernandez Marcos, Jaime Ortiz Esteller, Jaime Siguenza Clemente, Jaime Taltavull Sole, Jan Louis 

Bruggeman, Janire Peña Santiago, Javier Carrasco Garcia, Javier Cortes Lucena, Javier Gomez Gimenez, Javier I.Galindo Hormigos, Javier Lopez 

Enseñat, Javier Maria Cerquella Rodriguez, Javier Ochoa Mendoza, Javier Prieto Vargas-M., Javier Valverde Romero, Jeronimo Muñoz Corrales, 

Jesus Alejo Serrano, Jesus Amador Castrillo, Jesus Angel Val Rio, Jesus Garcia Benito, Jesus Peña Martinez, Jesus Puente Gete, Joaquin Garcia 

Rodriguez, Jordi Casas Masjoan, Jordi Novas Rovirola, Jorge AgustinIza Gonzalez, Jorge Baena Moreno, Jorge Bajo Perez, Jorge Carlo Righetto 

Zarza, Jorge Gascon Gasca, Jorge Jaumot Ortiz, Jorge Luis Aguilar Fernandez, Jorge Martin Poyatos, Jorge Rodriguez Basanta, Jorge Schez- 

Mayendia Alcantara, Jorge Zamora Campos, Jose Antonio Lopez Bermejo, Jose Antonio Pons Martínez, Jose Antonio Ramirez Barranco, 

Jose Antonio Vilchez Cecilia, Jose Enrique Pallares Lopez-Izq., Jose Enrique Renedo Cava, Jose Fco. Echeverria Eizaguirre, Jose 

Gerardo Perez Alaminos, Jose Ignacio Lopez Rodriguez, Jose Javier Aguirre Fernandez, Jose Javier Forcen Gascon, Jose Javier 

Gracia Cano, Jose Joaquin Roldan Martinez, Jose Luis Arias Aviles, Jose Luis Estrada De Artacho, Jose Luis Garcia Espinosa, 

Jose Luis Mayoral De Frutos, Jose Luis Muñoz Gascon, Jose Luis Rodriguez Oujo, Jose Manuel Fernandez Bada, Jose 

Manuel Fernandez Poyatos, Jose Manuel Gonzalez Seijo, Jose Manuel Melendo Larriba, Jose Manuel Quero De Barrio, 

Jose Manuel Rivas Botana, Jose Maria Blasco Badorrey, Jose Maria Franquet Viñas, Jose María Ibarguren Fdz- 

Mendiola, Jose Maria Molina Mancha, Jose Maria Muñoz Gutierrez, Jose Maria Sanchez Andres, Jose Miguel 

Bajo Agudo, Jose Miguel Hurtado Gonzalez, Jose Miguel Rodriguez Llerena, Jose Miguel Villaespesa 

Diaz, Jose Miguel Villarroel Garcia, Jose Ricardo Perez Soriano, Joseba Albizua Toquero, Josefa 

Maria Lovera Perez, Josep Ayuso Estañol, Juan Antonio Puga Garcia, Juan Antonio 

Serrano Sacristan, Juan Barron Delgado, Juan Carlos Capel Calvet, Juan Carlos 

Eguiara Garay, Juan Carlos Jimenez Cortes, Juan Carlos Martinez 

Monedero, Juan Carlos Onrubia Lozano, Juan De Dios Viana 

Ariza, Juan Del Hierro Marques, Juan Garcia 

Sanchez,



Juan Ignacio Torquemada Martinez, 

Juan Luis Martin Hurtado, Juan Manuel De Lara Alonso, 

Juan Manuel Ramos Perez, Juan Manuel Sancho Andres, Juan 

Manuel Viera Fernandez, Juan Maria Rojo Carrascosa, Juan Miguel Osoro 

Iturbe, Juan Poveda De Campos, Juan Sanchez Alonso, Juan Serrano Sanchez, Juana 

Paule Felipe, Julen Mtnez-Huarte Perez-Sarmie, Julia Maria Olivas Vidal, Julio Cesar Cubillo 

Navarro, Laura Bronchalo Gomez, Laura Diaz Ragel, Laura Jimenez Rodriguez, Laura Maria Cobos 

Serrano, Laura Martin Chicharro, Laura Padron Lopez, Laura Prieto Gomez, Lazaro Manuel Fernandez 

Alvarez, Leif Luis Garcia Bovig, Leticia Aparicio Martin-Romo, Lexuri Elorriaga Lecue, Lidia Sanchez Betancor, 

Luis A. Sanchez Hdez-Frances, Luis Castillejo Garrido, Luis E. Reviriego Agudo, Luis Jesus Melero Garcia, Luis 

Mariano Aparicio Ruedas, Luis Miguel Villa Balseiro, Luis Sanchez Serrano, Luis Santa Maria Brihuega, Luis Tomas De La 

Horra Plaza, M Carmen Simo Castell, M Dolores Crispin Saez, M. Asuncion Garrido Lorente, M. Belen Frances Foz, M. Conc. 

Gema Muñoz Vera, M. Esperanza Lorenzo Hernandez, M. Julia Sanz Martin, M. Lourdes Barainca Oyague, M. Magdalena Alonso 

Pelayo, M. Rosario Gonzalez Lopez, M. Rosario Perez Escajadillo, M. Soledad Prellezo Besoy, M.Del Rosario Robles Areños, Mª 

Alejandra Marrupe Garcia, Mª Arantzazu Leon Reveron, Mª Aranzazu De Miguel Gomez, Mª Ascension Perez Paniagua, Mª Covadonga 

Quiros Lopez, Mª Del Carmen Martin Piñuela, Mª Del Carmen Pozo Grande, Mª Del Pilar Diaz Lopez, Mª Dolores Luque Sanchez, Mª Dolors 

Casas Folch, Mª Encarnacion Del Pozo De Dios, Mª Esperanza Lopez-Migoya Muñoz, Mª Esperanza Sanz Llorente, Mª Isabel Villa Eslava, Mª 

Rosa Pons Baliellas, Mª Rosario Mirat Santiago, Mª Teresa Garcia Moran, Mª Victoria Almazan La Cave, Mª Victoria Carraffa Portela, Manuel I. 

Llanos Uhia, Manuel Lloris Lladosa, Manuel Lopez Sanchez, Manuel Pallares Alvarez, Manuel Prada Blanco, Marcos Rodriguez Juarez, Maria 

Amor Pinilla Gomez, Maria Angeles Beltran Andres, Maria Angeles Ramos Quero, Maria Aurora Garcia Polvorinos, Maria Aurora Segura Fuente, 

Maria Beatriz Garcia Garcia, Maria Belen Belenguer Anzano, Maria Belen Pascual Garcia, Maria Carmen Alcala Cristino, Maria Carmen Carmona 

Contreras, Maria Carmen Diez Hernandez, Maria Carmen Garcia Martinez, Maria Combo Sanchez, Maria Cruz Valdivieso Rodriguez, Maria Del Mar 

Carrera Otero, Maria Del Mar Garcia Luengo, Maria Dolores Martin Martinez, Maria Elena Richart De La Torre, Maria Gema Nuñez Martinez, Maria 

Henar Pascual Arribas, Maria Isabel Garcia Martin, Maria Jesus Revilla Gutierrez, Maria Jose Cordero Perez, Maria Jose Delgado Fernandez, Maria Jose 

Martin Rodriguez, Maria Jose Sendra Ripoll, Maria Reyes Fernandez Arancon, Maria Reyes Rodriguez Martinez, Maria Rosario Ruiz Alarcon, Maria 

Soledad Gracia Alos, Maria Teresa Estevez Garcia, Maria Teresa Fernandez Saenz Sta.Maria Teresa Herrera Lopez, Maria Teresa Rey Regueiro, Maria 

Tutusaus Delgado, Maria Vicenta Rel Monzo, Mariano M. Alcazar Negrillo, Marina Fernandez Garcia, Marta Blanco Bedate, Marta Capitan Obregon, Marta 

Caviedes Solana, Marta Llamazares Diez, Marta Maria Gonzalez Targhetta, Martin Atxera Cerda, Martina Collar Diaz, Mercedes Bergua Barrena, Mercedes 

Peñas Lorenzo, Miguel Abollado Rego, Miguel Angel Aragon Lopez, Miguel Angel Fernandez Gutierrez, Miguel Angel Ortega Orive, Miguel Angel Pastor 

Griñan, Miguel Angel Rios Fernandez, Miguel Esquerdo Castello, Miguel Gomez Ramirez, Miguel L.Cutrina Planella, Miguel Ruiz Diaz, Miriam Diaz 

Mendez, Mirian Antelo Morales, Monica Rubio Cano, Montserrat Francos Montero, Nadia Torres Martin, Nagore Balerdi Laguarda, Nagore Guenaga 

Ariznabarre, Narciso Perales Dominique, Natalia Lucia Melero Bermejo, Natalia Navajo Sanchez, Natalia Navas Nuñez, Nicolas Contreras Miguez, Nicolas 

Miralles Ferrer, Nicolas Moya Garcia-Lujan, Noelia Ballester Moreno, Noelia Rodriguez Bravo, Nuria Alvaro Carrasco, Nuria Benavent Trenado, Nuria 

Fernandez Martin C., Nuria Peon Ugidos, Nuria Relaño Garcia, Olga Maria Diaz Ramos, Oscar Alberto Varela Garcia, Oscar Ramos Lopez, Pablo Abejas 

Garcia, Pablo Baena Tovar, Pablo Del Pozo Jimenez, Pablo Herrero Torres, Pablo Jimenez Lopez, Pablo Jose Godino Rodriguez, Pablo Lancry Del Cerro, 

Paloma Martinez De Aguilar, Patricia Alvarez Alonso, Patricia J. Vera Fernandez, Patricia Marquez Alvarez, Paula Bartivas Ramos, Paula 

Azurmendi De La Vega, Pedro Barrio Vizan, Pedro De Mingo Herguido, Pedro Garcia Rex, Pedro Maria Martinez Basabe, Pedro María Miguel 

Rodríguez, Pedro Rdguez Viguri Escobar, Pedro Ricardo Norza Moreno, Pere Capdevila Escude, Pilar Alvarez Otero, Rafael Fernandez Campo, 

Rafael Garcia Vega, Rafael Gonzalez Fernandez, Rafael Olarte Corretjer, Rafael Sanchez Raymundo, Rafael Serrano Tomas, Ramon Antequera 

Naranjo, Ramon Bela Kindelan, Ramon Luis Frigola Costa, Raquel Azcarraga Bonilla, Raquel Campos Martinez, Raquel Dominguez Marrero, 

Raquel Lorente Berges, Raquel Millor Arbiza, Raquel Moreno Barrio, Raquel Silva Fernandez, Raul Barroso Garcia, Raúl Crespillo 

Maldonado, Raul Cuevas Gomez, Raul Martinez Martin, Rebeca Delgado Gil, Ricardo Perez Sevilla, Rita Maria Martinez Rodriguez, 

Rocio Gomez Maestre, Rocio Ortega Pelayo, Rocio Torres Vicent, Rosa Maria Guerrero Sanchez, Rosa Maria Jimenez Perez, Rosa 

Maria Martin Finez, Rosa Maria Ramon Bibiloni, Rosa Maria Romero Reim, Rosa Maria Serrano Rivero, Rosa Maria Suarez Ruiz, 

Rosario Martinez Toledo, Ruben Lobo Gomez, Saioa Basoco Garcia, Santiago Barreda Garcia, Santiago Cordova Naranjo, 

Santiago Sanchez Illanas, Sara Garcia Gonzalez, Sara Maria Sanz Raya, Sergio Bellido Gonzalez, Sergio Cesar Reyes 

Calvo, Sergio Garcia Calderon, Sergio Martinez-Cava Camacho, Sergio Vives Garcia, Silvia Martin Loeches Barral, 

Silvia Martinez Suarez, Silvia Mercado Lopez, Silvia Pozo Jimenez, Sonia A. Mondaray Zafrilla, Sonia Garcia 

Ruiz, Sonia Llanes Machado, Susana Orden Palomar, Tamara Espinosa Garcia, Teresa Capella Callaved, 

Teresa F. Peñaranda Pardo, Tomas Blanco Chamorro, Valentin Bes Barreras, Valentin Diaz Pieiga, 

Veronica Ezpeleta Lobato, Veronica Mejia Martinez, Vicente Gonzalo Garijo, Vicente R. 

Angles Galindo, Vicente Rozas Fernández, Victor Gasso Soler, Virginia Quintana 

Carreño, Yolanda Alonso D Los Santos, Yolanda Cerrato Astarloa, Yolanda 

Coronado Ordoñ, Yolanda Fernandez Rodriguez, Yolanda 

Gallego Alfaro, Yolanda Gonzalez Maroto


77 

Good customer segmentation, 

products to suit each need and 

proper risk management 

In 2007, Bankinter once again 

reaffirmed its trend for profitable growth, 

with excellent results, particularly 

in the customer segments and types of 

products that the Bank considers strategic: 

SMEs, Private Banking and Personal Finance. 

And all in a year of considerable 

volatility in the markets. 

06 

Business 


> Economic environment and 

international markets 

> Market share 

> Customer funds and 

loans and receivables 

> Customer segments 

> Capital Markets and Treasury 

> Risk management


06. Business 78 

Economic environment and international markets 

The world economy continued to grow at good rates in 2007, although symptoms 

of slowdown became apparent in some geographical areas, especially in the 

United States. The problems there with subprime mortgages affected the financial 

markets, particularly from the summer on, making credit more expensive and 

making consumers and investors more cautious. 

In Spain, economic growth remained fairly steady in 2007, at rates 

approaching 3.8%. In addition, this growth was more balanced than in recent 

years, with a surge in fixed capital investment and a lower negative contribution 

from the export sector, offsetting the slowdown in private spending and 

construction. 

The rise in energy and food prices increased the inflationary pressure 

towards the end of the year, taking the general rate of inflation in Spain to 4.2% 

in December, compared with 2.7% in 2006. There was a similar situation in 

Spain's neighbouring countries and particularly in the United States. 

Interest rates and foreign exchange 

After making no changes in its monetary policy for more than a year, the U.S. 

Federal Reserve began to lower interest rates in the second half of 2007. The Fed 

reduced its intervention rate from 5.3% to 4.3% between September and 

December, as a preventive measure to cushion the negative effects of the credit 

crisis on economic activity and on the confidence of consumers and investors. 

The European Central Bank, for its part, raised its reference rates from 3.5% 

to 4.0% during the first part of the year, in a process of interest rate 

normalisation which came to an abrupt halt as a result of the credit crisis that 

began in the summer. The official rates in Japan were also increased by 0.25% to 

0.5%.


06. Business 

79 

Government bonds performed unevenly on both sides of the Atlantic, in line with 

the movements in the respective official interest rates. European government 

bonds sustained price falls of nearly 3%, while American Treasury bonds 

increased in price, as a reflection of the Fed's rate cuts and the increasing 

symptoms of a slowdown in the US economy. 

There were sharp drops in prices in the corporate bond market as a result of 

the repricing of credit risk, starting with those linked to sub-prime mortgages 

in the United States and then spreading around the world to a wide variety of 

fixed income assets of different types. 

As for foreign exchange, the euro continued to grow stronger in 2007 

against the main currencies, reflecting both the improvement in the European 

economic environment and the economic problems in the United States and 

Japan. During the year the euro rose 10.5% against the dollar and 3.7% against 

the Japanese yen. 

Official Interest rates (%) 

2006 2007 

Euro Area 3.50 4.00 

United States 5.25 4.25 

Japan 0.25 0.50 

euro/ US dollar and euro/yen in 2007 

1.7 

1.6 

1.5 

1.4 

1.3 

1.2 

1.1 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

Apr. 

07 

May 

07 

Jun. 

07 

Jul. 

07 

Aug. 

07 

(Source Bloomberg, Central banks) 

Sep. 

07 

Oct. 

07 

Nov. 

07 

170 

160 

150 

140 

130 

120 

110 

Dec. 

07 

€/$ €/Yen (Source Bloomberg)



International stock markets 

In 2007, global stock markets were subject to very high volatility, especially from 

the financial crisis that began at mid-year and particularly affected the banking 

and insurance sectors. The result at the end of the year was quite mixed, with 

some markets in the black and others in the red; and the situation was similar on 

a sector level. 

In Europe the biggest increases occurred in Germany (up by 22%), driven 

by the consolidation of its economic recovery; followed by Spain (up by 7%), due 

to the sharp rise of Telefónica (up by 42%). However, other countries such as 

Italy, Sweden or Switzerland recorded falls during the year. 

By sectors, the best in Europe were Chemicals (up by 27%), Automobiles 

(up by 25%) and Electricity (up by 24%), whereas those performing the poorest 

were Insurance (down by 10%) and Banks (down by 9%). 

Performance of the main stock markets in 2007 in local currency (%) 

Spain Ibex 35 

2007 (local currency) 

+7.3% 

United States S&P 500 +3.5% 

United States Nasdaq +9.8% 

United Kingdom FTSE 100 +3.8% 

Germany DAX +22.3% 

France CAC +1.3% 

Japan Nikkei -11.1% 

(Source Bloomberg)


06. Business 

81 

Market share 

Throughout 2007 Bankinter followed the strategy of focusing on profitable 

growth, which translated into the maturity of the principal business lines, ranging 

from the stable and controlled loans and receivables of the SME segment to the 

emphasis on the growth in customer funds. 

For Bankinter, technology is one of the main pillars for managing the 

business, and this translated into an active and efficient use of multi-channel 

banking as a basic support for the commercial activity; which, in turn, contributes 

decisively to the development of a strategy of profitable growth. 

Along this line, the consolidation of the Customer Relationship 

Management (CRM) tool has enabled us to deliver to customers the Bank's value 

proposal based on products and services that are innovative, differentiated, and 

highly personalised. 

Market share (%) 

2006* 2007* 

Profit 2.17 3.78 

Assets 4.16 3.92 

Deposits plus debt securities 4.90 5.09 

Investment funds 3.55 3.52 

Loans and receivables 4.81 4.93 

(*) Comparing September 2006 data with September 2007.



Customer funds and loans and receivables 

During 2007 Bankinter promoted a strategy of attracting customer funds based on 

providing advisory services, quality of service and a broad and flexible range of 

products that offers increasingly demanding customers a wide variety of 

investment options adapted to suit their needs and interests. 

This led to growth in customer funds of EUR 6,090.7 million, an increase 

year on year of 18.6%. 

With regard to loans and receivables, Bankinter maintained the trend of 

robust, profitable and quality growth, following the strategic guidelines on asset 

quality. This has enabled us to combine a high rate of growth with one of the 

lowest non-performing loans ratios in the industry as a whole. 

At 31 December 2007, the Bankinter Group's loans and receivables, exsecuritisation, 

amounted to EUR 39,923.6 million, representing an increase on 

December 2006 of 16% (EUR 5,507.6 million more). 

One of the pillars supporting this growth continued to be the mortgage 

activity, although the increasing importance should be pointed out of the 

financing associated with the SME business, which continues to become stronger 

as a key segment for the Bank's financial business activities.


06. Business 

83 

Customer funds 

Bankinter continued to focus its efforts on increasing customer funds. As a result, 

we ended 2007 with EUR 38,774.3 million in customer funds, which was 18.6% 

more than at 2006 year-end, an increase of EUR 6,090.7 million. 

This figure shows that this line of growth remains constant, with annual 

increase figures that are similar to those presented in 2006 with respect to the 

previous year. 

Bankinter's business relies strongly on the simplicity, innovation, variety 

and quality of its products. During the year the options of the products that the 

Bank already has in its portfolio were enhanced and expanded, while at the same 

time new proposals of value for customers were created. One example is the 

'Investment Adviser', a new tool that contributes great added value to customers 

by suggesting an investment portfolio that fits their investor profile, and that is 

intended to strengthen the strategy of personalised advice and customer service 

that characterises Bankinter, as well as complying fully with the Directive on 

Financial Markets and Instruments that recently came into force. 

The focus on growth in customers and balances is reflected in the two 

ongoing options of high-interest deposits for attracting funds, for new customers 

and/or new money, which the Bank had on offer throughout 2007, but above all, 

and very particularly, in the launch of a new line of structured deposits, called 

'DepoClips', that began with the ‘DepoClip Triple Ocasión’, an extremely successful 

product, which was fully subscribed before the deadline. 

Customer funds 

Customer deposits 

General government 

Customer sectors 

Current accounts 

Savings accounts 

Time deposits 

Asset repos 

Non-residents 

Valuation adjustments 

Bonds and other marketable 

debt securities 

Total 

2006 2007 € thousand % 

18,409,659 22,540,818 4,131,159 22.44 

394,997 348,384 -46,613 -11.80 

17,471,296 21,284,937 3,813,641 21.83 

8,339,037 8,672,294 333,257 4.00 

114,244 98,250 -15,994 -14.00 

3,476,024 5,625,991 2,149,967 61.85 

5,541,991 6,888,402 1,346,411 24.29 

467,057 755,379 288,322 61.73 

76,309 152,118 75,809 99.34 

14,273,921 16,233,470 1,959,549 13.73 

32,683,580 38,774,288 6,090,708 18.64



Off-balance-sheet funds under management 

The off-balance-sheet funds under management fell by EUR 148.9 million (1.3% 

less than at 2006 year-end) and ended the year with a total balance of EUR 

11,350.9 million. 

This figure includes an increase of EUR 108.8 million in pension fund 

assets, which was 10.2% more than at 31 December 2006, an increase of EUR 

145.3 million in Government bonds held to maturity (171.6% more) and a 

reduction of EUR 629.3 million in investment fund assets. 

100 structured bonds were launched in 2007. This wide range of options is 

a reflection of how demanding our customers are, and provides them with an 

offering in line with their requirements, in which bespoke structured bonds took 

on great importance and accounted for 60% of the amount contracted, and there 

was even a choice between two structured bonds with sustainability features 

which in 2007 accounted for a volume of nearly EUR 9 million. Over the past 

twelve months structured bonds issued previously reached maturity, with much 

higher returns than other assets with similar levels of risk. 

There also continued to be a strong and extremely successful emphasis in 

2007 on expanding the range of hedging products, which came into being with 

the aim of mitigating our customers' interest rate and exchange rate risk, with a 

current contracted value of nearly EUR 11,650 million and 45,527 customers, 

excluding the investment clips. 

Off-balance-sheet funds under management (thousands of euros) 

2006 2007 € thousand % 

Investment funds 8,920,220 8,290,908 -629,312 -7.05 

Pension funds 1,068,630 1,177,459 108,829 10.18 

Commercial paper 25,403 25,403 - - 

Government bonds held to maturity 84,671 229,959 145,289 171.59 

Asset management 1,400,841 1,627,190 226,349 16.16 

Total Off-balance-sheet funds 11,499,765 11,350,919 -148,846 -1.29


06. Business 

85 

Investment funds 

The assets under management totalled EUR 8,290.9 million at the end of 2007, 

which was 7.1% less than in the previous year. It should be remembered that this 

was a particularly difficult year in the fund world, where the drop in assets 

managed was a widespread feature. 

Mention should be made of the strategic consolidation that has led us to 

market the funds of other fund management firms as part of the offering that 

Bankinter makes available to its customers. Of the 360 funds currently marketed 

by the Bank, approximately 75% are funds of fund management firms that do not 

belong to the Group. 

For more than ten years Bankinter has had distribution agreements with 

leading international fund managers for the distribution of their funds, with the 

aim of contributing value to customer portfolios. The assets managed by fund 

managers other than the Group's fund manager amounted to EUR 807.1 million, 

which was 16.8% more than in 2006. 

There was a slight shift in the distribution of the assets in the investment 

funds portfolio with respect to 2006: there was a slight increase in some fund 

categories, such as long-term fixed-income and fixed-income mixed funds, and a 

decrease in equities funds, which was in line with the performance of the 

financial markets. Money market funds, at 50% of the total portfolio, continued to 

account for the most significant portion of the overall total. 

Once again Bankinter expanded and improved its investment fund offering, 

seeking to have one of the most competitive ranges in the market both in 

profitability and types of funds. Evidence of this was the increase in the number 

of alternative management funds, the objective of which is to obtain absolute 

profitability regardless of the direction taken by the financial markets, in contrast 

to the more traditional funds, the objective of which is linked to a benchmark or a 

reference index. There is also a place for Socially Responsible Investment funds in 

our portfolio, as shown by the more than EUR 23 million deposited in funds which 

invest in renewable energies. 

Distribution by type of fund (%) 

Money market funds 49.64 

Fixed Income funds 7.45 

Mixed funds 6.81 

Equities funds 17.59 

Guaranteed funds 16.68 

Alternative management 1.82



Insurance 

In line with its firm commitment to the insurance business, in March 2007 the 

Bank succeeded in setting up an alliance with Mapfre Vida, when the latter 

acquired a 50% stake in Bankinter Seguros de Vida, S.A. 

The aim of this alliance is to increase the speed at which new products 

demanded by our customers are created and to do it hand in hand with Mapfre 

Vida, the Spanish market leader not only by volume and management capability, 

but also in terms of the quality perceived by its customers, a value which we both 

share as one of our strategic pillars. 

An outcome of this alliance was the launch in November 2007 of the first 

joint product 'PIAS Gestión Dinámica' for which 3,269 policies were taken out for a 

total of EUR 12.0 million. 

The pensions business continued to make its usual progress, with an 

increase of 10.2% over 2006, to reach a total of EUR 1,177.5 million. 

Performance in Life, Risk and Accident Insurance was also excellent, with a 

substantial increase in business, totalling EUR 28.8 million in premiums and 

achieving a 28% increase in volume compared to 2006 and a 46% increase in new 

policies. 

In General Insurance the expansion of the range of products continued, 

achieving business of EUR 32.4 million mediated, representing a 23.4% increase 

in our portfolio in comparison with 2006. 

In direct collaboration with the Social Action Area of the Bank, we offer 

accident insurance completely free to the relatives of people with disabilities who 

sign up for our 'Protected Estate Management' product, which takes maximum 

advantage of the benefits available to such individuals under Law 41/2003 on 

Protected Estate, while offering them an investment portfolio tailored to suit their 

needs. At year-end the minimum amount of these insurance policies (it depends 

on the average balance at the time of the accident) was only EUR 86,000 due to 

the newness of the product and its recent launch. 

The Bankinter Insurance customer profile is that of a person aged 35-44 

(39% of the total), of whom 43% are women and 57% are men.


06. Business 

4002 

87 

Bankinter Consumer Finance 

In September Bankinter reached agreement with Capital One Bank (Europe) PLC 

to take over all of their joint consumer finance business, based on the good 

earnings performance and the expectations for growth. The two institutions had 

had a strategic alliance since 2001 for managing the business through revolving 

credit cards and personal loans under the ‘Capital One de Bankinter’ brand. 

This branch of the business is managed by the Bankinter Consumer Finance 

subsidiary, which has the same team of people. A new brand ‘Obsidiana, Una idea 

Bankinter’ was launched, encompassing the activities of this business. At year-end 

this business line had average loans and receivables of 278.8 million credits to 

customers, with more than 361,360 cards issued. 


Pese a enfrentarnos, especialmente en el último trimestre de 2007, a un entorno 

crediticio más complicado, Bankinter ha seguido apostando por un crecimiento 

rentable, diversificado y sano en términos de calidad de los activos. Ello ha 

permitido combinar una elevada tasa de crecimiento junto con uno de los ratios 

de morosidad más bajos del conjunto de la industria. 

At 31 December 2007, the Bankinter Group's loans and receivables, exsecuritisation, 

amounted to EUR 39,923.6 million, representing an increase on 

December 2006 of 16% (EUR 5,507.6 million more). 

This growth continued to be led by the thrust of the mortgage business, 

although that of financing in the SME business, which in 2007 continued its 

consolidation as a key segment in the Bank's growth, is becoming increasingly 

significant. 

There was no variation in the selective strategy applied to the mortgage 

business, both in terms of types of customers and in the quality of the loan assets 

generated. 

Bankinter's value proposal in the mortgage business is based on the ability 

to offer the best mortgage product on the market, under the best possible 

financial conditions, on personalised terms for each customer and with an 

efficient and agile process of marketing and arrangement that aims for standards 

of excellence in terms of quality of service.



Mortgage loans grew by 14.1% to EUR 28,094 million in 2007. New lending 

amounted to EUR 6,392.7 million. As is customary, 93.9% of this annual lending 

relates to customers with a medium or high profile. 

It is important to highlight the launch before the summer of the 'Hipoteca 

0.18' mortgage, which put Bankinter back in the lead in the mortgage market. 

During months in which the property business was slowing down, the marketing 

of this product made it possible to achieve a significant increase in the Bank's 

mortgage business, centred, and this is what is more important, on existing 

customers with Bankinter's strategic profile. 

Any discussion of Bankinter’s lending activity in 2007 must include the 

focus on the SME segment, in which lending grew by 27.3% to EUR 6,217.9 

million. This growth occurred in all of the financing lines: credit/loans (27.8%), 

leasing (27.0%), confirming (62.5%), factoring (46.2%), import/export financing 

(81.7%), etc. 

This substantial growth was supported by one of the most comprehensive 

offerings on the market of products and services directed at small and medium 

size business customers, most of which can be managed using remote channels 

such as the Internet, telephone or mobile phone. 

In means of payment there was substantial growth under all headings of 

the business in 2007. The number of cards issued rose by 12.5% to 980,772. 

Similarly, the number of transactions performed using Bankinter cards in shops 

and ATMs rose to 50.8 million, for a total volume of EUR 3,918 million, 

representing growth of 9.4% and 10.3%, respectively. 

International business 

The International Business Division develops products and services that meet the 

demands of customers in their day-to-day cross-border business dealings, either 

in foreign currency or euros. Through the international business managers 

distributed among the Bank's different regional organisations, this division aims 

to help the commercial network to identify opportunities in this business line. In 

addition, global solutions for international transactions are offered through the 

Financial Institutions department, which belongs to this division, and through 

agreements with other banks.


06. Business 

International business’s contribution 

38.3% 

more than in 2006 

89 

2007 was an excellent year for Bankinter's international business. It contributed 

EUR 109.5 million to the Bank's profitability, which was 38.3% more than in 2006. 

With a customer base of over 198,000 and volumes managed of more than EUR 

30,000 million, 2007 stood out as a year of substantial increases in profitability 

in the three most important business areas: services (up by 12.5%), lending (up 

by 92.7%) and customer funds (up by 11.5%). 

One of the main objectives of this area, in line with the general strategy of 

Bankinter, is the multi-channel nature of its range of products and services. 

Remote channels, such as the Internet, are essential tools for our customers in 

their daily international transactions with the Bank. More than 76% of our 

customers' international payments are made using the Internet. 

As regards products, in the world of private individuals, 2007 saw the 

consolidation of the multi-currency mortgage loan as a mortgage alternative for 

customers. This product, which makes available mortgage loans denominated in 

euros, Swiss francs or Japanese yen, experienced considerable growth both in 

terms of the number of mortgages arranged, which increased by 165.8%, and in 

the amounts managed, with an increase of 183.4% over 2006. The spread 

between the interest rates of the different currencies plus the positive progress of 

the euro against the other currencies meant that this type of mortgage loan was 

much in demand from customers with a certain level of knowledge and a specific 

financial profile. 

2007 was also a year of growth in the world of corporate entities: SMEs and 

Corporate banking. The online foreign currency trading platform, Broker de 

Divisas, became firmly established, with 2,450 customers signed up for a service 

that offers a range of options, from buying or selling - in spot or forward 

transactions - the most liquid currencies in the market, to applying conversion to 

international payments and receipts. 

2007 also saw the introduction of the 'Specialists in International Business 

Desk'. This service, consisting of a team of four people, gives our customers access 

via a single telephone number to commercial and transactional advice on 

everything to do with international operating procedures. 

Lastly, with the aim of responding properly to our customers who are 

importers and/or exporters, the Financial Institutions Area - together with the 

Risks Area - has defined a framework of action, regarding both risk and 

procedure, for these transactions, thus enabling us to accompany our customers in 

their cross-border commercial activities.



Customer segments 

In 2007, Bankinter once again reaffirmed its trend for profitable growth, 

strengthening the business relationship it has with its customers, mainly with 

those in the segments that the Bank considers strategic. 

Illustrative of this is the pre-tax profit of the SME segment which was up 

36.0% year on year, a figure which reveals that the big investment and the 

strategic focus that the Bank has been placing for some time on this area in 

pursuit of continued growth has borne fruit. 

The business divisions encompassing the customers with higher net worth 

achieved substantial growth in their pre-tax profit year on year: 24.4% more in 

Personal Finance; and 23.0% more than the previous year in Private Banking. 

During the year the Bank signed up 181,739 new customers, an increase of 

5.6% on 2006 and a huge success in customer attraction. As a result, the Bank 

had a total of 744,885 active customers. 

The Bank's commercial capabilities were significantly enhanced in 2007, 

with year-on-year growth of 13.2% in the number of branches and 13.8% in the 

number of employees. 

Bankinter has always defined itself as a technological bank and 

consequently once again applied technology perfectly in the Bank's daily 

procedures. This enabled us to foster relations with our customers and achieve an 

excellent result in cross-selling, which stood at an average of 6.5 products per 

customer. 

Highlights of the Customer business (millions of euros) 

2006 2007 2006/2007 (%) 

Average funds 12,785.27 15,673.22 22.85 

Average loans and receivables 31,809.41 37,092.89 16.61 

Profit before tax 362.09 451,92 24.46 

Efficiency (%) 48.37 47.43 -0.94 

ISN score 77.46 77.54 0.08


06. Business 

91 

Private individuals 

There was intensive commercial activity in the Private individuals segment 

throughout 2007, resulting in 14% more new customers attracted than in the 

previous year. In balance sheet terms, we ended the year with average total 

controlled customer funds of EUR 7,184.3 million, which was 14.5% more than in 

2006. 63% are typical customer funds and 37% are intermediation funds. 

The figure for lending stood at EUR 19,915.9 million at year-end, recording 

a year-on-year increase of 9.0%. Deserving special mention under the lending 

caption in the Private individuals segment was the intensive mortgage activity 

there was during a year of clear recession in this business. 21,190 mortgage 

transactions were completed amounting to a total volume of EUR 3,833.3 million. 

This represented a year-on-year increase of 5.3% in the volume of mortgages 

arranged with customers in this segment, whereas in the sector as whole - per the 

latest INE published data - there was growth of only 0.9%. 

The Bank also kept its commercial focus on its best customers: 67% of these 

mortgage loan transactions were arranged with customers with a high socioeconomic 

profile. The outcome of this focus is the magnificent quality of our 

mortgage portfolio, with a non-performing loans ratio that continues to be among 

the lowest in the sector: 0.1% in December 2007. 

As for commercial activities with customers, Bankinter continued to rely 

heavily on the CRM tool, which enables us to adapt our product and service 

offering to the needs of the different types of customers. As a result of this 

activity our level of cross-selling remained extremely high, leading to figures such 

as the 6.5 products, on average, that our customers have. 

Lastly, Bankinter was once again firmly committed to providing quality of 

service to its customers as a strategic pillar of the Bank's corporate culture, 

enabling us to achieve an aggregate ISN score at year-end of 77.1. 

Highlights of the Private individuals business (millions of euros) 

2006 2007 2006/2007 (%) 

Average funds 3,534.84 4,531.49 28.20 

Average loans and receivables 18,269.24 19,915.85 9.01 

Profit before tax 116.02 131.23 13.11 

Efficiency (%) 58.12 58.67 0.55 

ISN score 76.9 77.14 0.24



Private Banking 

2007 was a brilliant year for the Private Banking Division. Noteworthy was the 

increase of 11,182 in the number of customers, giving a total of 54,911 active 

customers, which was 25.6% more than in 2006. 

Between on- and off- balance sheet customer funds under management and 

other intermediated products we achieved growth of 19.7%, with the figure of EUR 

10,506 million under management. A highlight was the caption of typical 

customer funds, which achieved extraordinary growth of 29.4% year on year, 

thanks to effective commercial management. Mention should also be made of the 

performance of the fixed income caption, with a rise of 75% in 2007, continuing 

with the positive progress achieved in previous years. 

There was a 30.83% increase in the figure for lending to EUR 3,409.7 

million, which was consistent with our value proposal of offering comprehensive 

banking to customers rather than a mere asset management service. 

As a result, the Division’s pre-tax profit increased by 23.0% year on year to 

EUR 85.1 million. 

With regard to our installed capacity, we continued to expand our network 

of Private Banking Centres and at the end of the year we had a total of 47 

distributed throughout Spain, 6 more than in 2006. 

In parallel, our team of staff continued to grow, with the aim of serving our 

growing customer base with appropriate quality standards. Bankinter currently 

has a team of 258 members of staff devoted exclusively to personal management 

and advisory functions for customers, who have joined the business gradually, 

thereby keeping our efficiency ratio at 36.6% at 2007 year-end.


06. Business 

93 

The specific training programmes have been updated and enhanced to adapt 

them to the requirements of the new MiFID regulations. There were also in-house 

courses taught to all the staff, which lead to the qualification of 'European 

Financial Adviser' awarded by the EFPA (European Financial Planning 

Association). 

Our portfolio of products continued to expand, with a highlight in 2007 

being the launch of the 'Bonoclips' and the 'Depoclips' that are intended to 

consolidate our sophisticated range of bespoke structured products. 

In 2007 more than 26 Private Banking events and lectures were organised 

in the principle cities of Spain, where we had the opportunity of sharing with the 

4,900 existing and potential customers who attended them our knowledge and 

the expectations of the Bank's experts regarding a variety of current issues of 

particular importance to the investment world (property sector, financial markets, 

products, etc.). 

Finally, Private Banking continued to focus on its efforts to intensify 

relations with customers using all the Bank's networks and channels. In this 

respect, Customer Relationship Management (CRM) has become a key component 

of our way of working, helping us to ensure that we provide personalised, quality 

service to all the Bank's customers. 

Highlights of the Private Banking business (millions of euros) 

Average funds 



Efficiency (%) 

ISN score 

2006 2007 2006/2007 (%) 

2,207.12 3,225.53 46.14 

2,606.19 3,409.66 30.83 

69.18 85.10 23.00 

34.18 36.6 2.42 

77.55 76.95 -0.60



New customers attracted 

39.1% 


Personal Finance 

For the Personal Finance Division, 2007 was marked by strong growth in all the 

balance sheet lines. This achievement was due to a combination of different 

variables: quality indexes bordering on excellence, a record number of new 

customers attracted and the development of new services and products. All 

targeted on achieving comprehensive management of customers' assets. 

Service quality, one of the fundamental factors that underpins our business, 

was perceived in 2007 by the customers of Personal Finance with a very high 

rating of 79.7 ISN points, which places us clearly ahead of the sector average. 

The Personal Finance Division, set up to meet the needs for advice and 

management of customers with a high level of income or net worth, took an 

important step in 2007 in developing new products and services within an overall 

offering of advisory services and comprehensive management of customers' 

assets. This is the framework for promotion of the 'Value-Added Services' area 

which includes activities such as investment in property, in art, corporate, 

bankinterallstars (a specific service for top-class actors, artists and sportsmen and 

women), family protocol, etc. 

The combination of all these factors, together with an unbeatable IT 

platform and a team of staff that is a sector leader, is what enabled us to achieve 

a figure for on- and off-balance-sheet assets plus other intermediated products of 

EUR 17,486 million at the end of 2007, an increase of 37.2% on the figure for the 

previous year; as well as a 39.1% increase in the number of new customers 

attracted. 

There was a 50% increase year on year in the number of SICAVs (open-end 

investment companies) managed, enabling Bankinter to maintain its fourth place 

in Inverco's league table of institutions with the largest number of collective 

investment companies. 

Highlights of the Personal Finance business (millions of euros) 

Average funds 




ISN score 

2006 2007 2006/2007 (%) 

1,206.92 1,649.87 36.70 

921.66 1,467.60 59.23 

39.28 48.87 24.41 

19.48 19.59 0.11 

82.39 79.72 -2.67


06. Business 

Corporate Banking PBT 

25.9% 


95 

Corporate Banking 

In 2007 the Corporate Banking segment maintained the trend of profitable growth 

of previous years, enabling it to reach, for the first time in its history, the 

important figure of EUR 102.0 million of pre-tax profit, which was 25.9% more 

than in 2006. These figures provide confirmation of the importance of the 

segment of big and medium-size companies, in which the Bank has a substantial 

and growing market share, with significant increases in all the indicators of a 

business which is considered mature but in which Bankinter still has a great deal 

of scope for progress. 

This is illustrated by the 15.9% increase in loans and receivables to EUR 

4,972.2 million in December, giving a total, including off-balance sheet risks, of 

more than EUR 6,700 million. 

The value proposal of Corporate Banking continued to focus on a wide 

range of innovative and distinctive financial products and services which, with the 

support of the Bank's proven technological capability and its multi-channel 

distribution, enable us to provide customers with efficient solutions for their daily 

banking requirements; all based on a firm commitment to quality of service, with 

an aggregate ISN score at the end of December of 77.7 points, one of the highest 

of the Bank's different segments and channels, and well ahead of our competitors. 

The installed capacity is embodied in 51 centres specialising in business 

management and, above all, in the significant and growing use our customers 

make of the Internet channel, with our website for businesses accounting for 

74.2% of total transactions at year-end, making this channel the one preferred by 

customers for dealing with the Bank in their day-to-day business. 

Highlights of the Corporate Banking business (millions of euros) 

Average funds 




ISN score 

2006 2007 2006/2007 (%) 

3,595.05 3,459.94 -3.76 

4,291.55 4,972.24 15.86 

81.00 102.01 25.94 

30.96 28.29 -2.67 

78.67 77.72 -0.95



Average total assets 

25.9% 


As a result, in 2007 we once again succeeded in improving on the principal 

performance ratios of our business, recording a return on equity (ROE) of 26.5%, 

which was more than three points higher than in 2006, and achieving an 

efficiency ratio - measured by operating costs as a percentage of total operating 

income - of 28.3%. Also with an improvement of nearly three points on 2006, 

while maintaining excellent quality in the lending portfolio, with another record 

low in the non-performing loans ratio, which ended the year at 0.2% of loans and 

receivables plus off-balance-sheet risks. 

In short, 2007 for Corporate Banking was another year of strong, profitable, 

balanced, efficient, sound and healthy growth; which means we can continue to 

face a more uncertain future in the economic field with optimism. 

Pymes 

2007 was another great year for the SME segment at Bankinter. There was 

growth in both the number of active customers and the business volume, which 

translated into significant increases in the balances managed. 

The number of new customers attracted and the percentages of activation 

of these customers were both higher than in 2006. Average total assets grew by 

25.9%. This growth continued to be underpinned by the sound assessment of 

credit risk, with diversified quality lending, making our non-performing loans 

ratio of 0.8% one of the lowest in the market. 

As in previous years, this significant increase in customer transactions was 

successfully managed mainly through the most efficient channels, as part of the 

objective of efficient multi-channel banking that constitutes our proposal to 

customers. Thus it was noteworthy that in 2007 customers habitually carried out 

their transactions over the Internet, which was used to perform over 115 million 

transactions in the year, with extremely high standards of service reliability and 

quality.


06. Business 

97 

With regard to quality of service, noteworthy is the consolidation of the Net 

Satisfaction Index (ISN) at scores of over 75 for customers in the SME segment, 

with a year-end score of 76.7. 

Work continued in 2007 on developing the new SME distribution network in 

industrial parks: 37 new centres were opened in the year, bringing the total 

number of SME branches to 161 at the end of December. 

The specialised knowledge required to serve SME customers, combined with 

a further significant increase in the number of staff employed in this segment, led 

once again to enormous efforts in training. 

Even taking into account the investment made this year to develop the new 

model of distribution, the efficiency ratio improved by more than 3 points. 

Highlights of the SME business (millions of euros) 

Average funds 




ISN score 

2006 2007 2006/2007 (%) 

1,958.34 2,533.59 29.37 

4,886.11 6,217.85 27.26 

53.79 73.12 35.95 

57.28 53.89 -3.39 

77.19 76.70 -0.49



Foreign Nationals 

This business segment continued to focus on European citizens who buy 

residential property along the Spanish coast. There are all kinds of reasons 

(demographic, climate, quality of life, low-cost airlines, single currency, etc.) why 

the number of European residents in our country is not only increasingly 

consolidated, but also shows a clear trend for growth. 

Efforts throughout 2007 focused on taking forward the approach embarked 

on during the previous year of rolling out a specific offering capable of giving a 

rapid bespoke response to any financing need of these customers, who normally 

have assets split between two countries. 

A particular highlight of this offering is a variety of mortgage options to 

suit any approach that brings us closer to their financial culture of origin and to 

their specific needs in Spain, which is where they require the service: from 

'Interest Only' mortgages for buying or for liquidity, to pre-authorised offers to 

extend mortgages for customers with specific parameters. And all with multichannel 

service, uniform management criteria, specialist branches and staff, 

centralised, streamlined and efficient procedures, and other types of variables 

that enabled us to record another exceptional year of growth in this business. 

Noteworthy in this respect was the increase of 29.6% in lending and of 

7.3% in customer funds, accompanied by a 41.9% rise in pre-tax profit and 

striking performance ratios including the following: the efficiency ratio was 

42.9%, a year-on-year improvement of more than five points; double that 

improvement in the ROE, which rose from 33.1% at the end of 2006 to 43.7% at 

the end of 2007. 

In this segment we think it is crucial to maintain high levels of customer 

satisfaction with the service received. The figures indicate that this year we were 

bordering on excellence, with a year-end ISN score of 83.1. The satisfaction of a 

customer from another country, another financial culture, another language, with 

different expectations and needs, but a customer who is demanding, is an 

obligatory requirement for continued growth in this segment. 

Highlights of the Foreign Nationals business (millions of euros) 

Average funds 




ISN score 

2006 2007 2006/2007 (%) 

255.22 273.94 7.33 

648.09 840.15 29.64 

9.64 13.67 41.89 

48.44 42.91 5.53 

83.21 83.12 -0.09


06. Business 

99 

Markets and Treasury 

Bankinter maintained an active presence in the fixed income markets as a 

government bond and bills market maker and joint leading issuer of Spanish 

Treasury issues. Similarly in the corporate bond market, with a very active desk 

in both notes and preferred shares, and as an issuer of debt and asset-backed 

bonds. 

With regard to public offerings of securities, the Bank took part in three of 

the main transactions in 2007: Realia, Criteria and Iberdrola Renovables, with an 

outstanding placement through the Bank's different distribution channels, in 

which a particularly important role was played by the Internet channel. Bankinter 

is also very active as an issuer and distributor of warrants. 

Bankinter’s balance-sheet growth made it advisable to maintain an active, 

careful and efficient policy of managing the Bank's liquidity and capital, keeping 

access open to the European short- and long-term capital markets and the 

different instruments available. Bankinter's good image and solvency meant that 

the issues made were very well received. In January 2007, Standard & Poor's 

rating agency revised its outlook on the Bankinter rating to positive from stable, 

reflecting the possibility of an improvement in the ‘A/A-1’ rating as a result of the 

increasing diversification and improved profitability of the business. 

To obtain liquidity, the Bank used short-term issue programmes both on 

the domestic market, with the Bankinter commercial paper programmes, and 

on the international market, with the Euronotes programme, with average 

balances in the year of EUR 3,340 million and EUR 1,081 million, respectively.



Three securitisations were launched in 2007: two of mortgage loans and one of 

loans to SMEs, for a total of EUR 3,107 million. Lastly, and to complete the capital 

and liquidity requirements, EUR 1,000 million of senior debt and EUR 50 million 

of subordinated debt were issued. 

Also, in July Bankinter launched the first Spanish synthetic securitisation of 

equity tranches, of fourteen mortgage securitisations, amounting to EUR 185.1 

million. This novel transaction made it possible to transfer the retained risks 

linked to the first losses on a securitised mortgage portfolio with an outstanding 

balance of EUR 10,364 million. With this important transfer of credit risk, the 

Bank strengthened its capital ratios, acting in advance of the future regulatory 

capital requirements that will come into force in 2008 and taking a pioneer action 

in this area. The transaction was well-received by the market and the rating 

agencies. 

The liquidity situation in 2007, measured in terms of dependence on the 

interbank market and excluding transactions against assets, as of the last day of 

each month, was as follows: 

Variation in liquidity. Net debt on the interbank market (Month-end data) 

-7,500 

-6,500 

-5,500 

-4,500 

-3,500 

-2,500 

-1,500 

-500 

0 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

Dependence on interbank market 

Apr. 

07 

May 

07 

Jun. 

07 

Jul. 

07 

Aug. 

07 

Sep. 

07 

Oct. 

07 

Nov. 

07 

Dec. 

07


06. Business 

101 

Risk management 

The organisational structure of the Bank reflects the principle of independence 

and segregation of functions between the business units and the units responsible 

for monitoring and controlling risk. The Risk Area, whose manager reports 

directly to the CEO, comprises the divisions relating to the Bank's main risks 

(credit, market and operational) and a Comprehensive Risk Management Division 

responsible for the development, improvement, control and monitoring of internal 

models for the different categories of credit risk and economic capital, as well as 

for the integration of these models in the Bank's management operations within 

the framework laid down by Basel II. 

Risk management is one of the competitive advantages of the Bankinter 

Group, and it places special emphasis on identifying, measuring, managing, 

controlling and monitoring the main risks to which the Bank's business is 

exposed: credit risk, market risk (structural interest rate risk and the risk involved 

in the Treasury and Capital Markets activity), liquidity risk and operational risk; 

without neglecting other types of risks present in the business of financial 

institutions, such as reputational risk, strategic risk, etc. 

In view of the importance of the issues relating to the risks that the Bank 

assumes or may assume, the Board of Directors of Bankinter is the body 

responsible for establishing the strategy and for approving and supervising the 

risk policy and the internal control systems of the Bankinter Group, without 

prejudice to the existence of the related executive functions. Although a detailed 

description is given below of the Bank's risk control systems involving various 

internal bodies, the function performed by the Board is not just that of a definer 

of strategies but also of continuous control and oversight of all the issues relating 

to risks. 

The Board of Directors, acting through the Audit and Regulatory 

Compliance Committee, the Audit Division, and the Risk Divisions, guides and 

supervises the accounting policies and internal control systems and procedures in 

relation to all the risks involved in the Bank’s activity, as well as the prevention of 

money laundering pursuant to current legislation. For this purpose, the Board 

of Directors approves and periodically reviews the main credit risks and sets and 

updates the specific limits for market and liquidity risk. 

The Bank continues to make headway in implementing methodologies, 

systems and policies for the measurement and management of risk and capital 

requirements in accordance with the principles laid down in the new Basel II 

Capital Framework.



Basic principles of the risk function 

The ultimate purpose of the risk function at Bankinter is to assist in maximising 

the return on capital and the creation of value that is sustained over time. The 

basic principles that govern it are as follows: 

Independence of the function. 

Alignment with the strategic objectives. 

Comprehensive risk management. The Bank identifies, measures, manages and 

controls all of its significant risks. 

Importance of automatic approval systems, new methodologies of risk 

quantification and use of technology in the risk management systems. 

Assessment of the risk when launching any new product or service. 

Risk diversification among customers, sectors, counterparties and markets. 

Identification, assessment and control of risk in the launch of new products. 

Importance of the service quality factor in the risk function. 

Structural and market risk management policies 

The purpose of Bankinter's policy on the management and control of 'structural 

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 

income statement, by adopting the most appropriate investment or hedging 

strategies. 

The Board of Directors delegates the constant 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), without prejudice to being kept informed and up to date at all 

times regarding any actions taken in this respect. Each year it reviews, approves 

and delegates to the ALCO the limits applicable for managing the aforementioned 

risks. The Treasury and Capital Markets division implements the decisions taken 

by the ALCO with regard to the Bank's corporate positions. 

Also on an annual basis the Board of Directors sets the operating limits 

applicable to the Treasury and Capital Markets division for dealing on the Bank's 

own account in the financial markets, in order to take advantage of any business 

opportunities that may arise. 

The Market Risks division, which forms part of the Risk Management 

Department, has the independent function of measuring, monitoring and 

controlling the Bank's structural and market risks.


06. Business 

Interest rate risks (millions of euros) 

Assets 

103 

Structural risks 

The following paragraphs describe the models applied in general at the Bank 

for managing, measuring and controlling the structural interest rate and 

liquidity risks: 

Structural interest rate risk 

Structural interest rate risk is defined as the Bank’s exposure to market interest 

rate fluctuations resulting from maturity and repricing gaps in the balance-sheet 

asset and liability items. 

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. 

Repricing gap analysis is used to manage, measure and control interest rate 

risk, which makes it possible to obtain a simplified view of the balance sheet 

structure and form an idea of the impact of possible variations in interest rates. 

The measures adopted to manage structural interest rate risk are in 

compliance with the structure of limits approved by the Board of Directors, 

defined as the maximum gap or difference that can be maintained, for each 

segment in the interest rate risk map, between the total amount of assets and 

liabilities, the control and monitoring of which is the responsibility of the Market 

Risk Division. 

The situation of the interest rate map as of 2007 year-end was as follows: 

Up to 1 month 1-3 mths 3-12 mths 1-2 years 2-3 years 3-4 years 4-5 years Over 5 years Total 

Loans and receivables 17,988 5,878 16,548 603 186 160 106 1,016 42,485 

Fixed-income portfolio 498 497 1,697 928 412 467 141 2,891 7,532 

Other assets 856 0 0 0 0 0 0 1,232 2,088 

Total assets 19,342 6,375 18,245 1,531 598 627 248 5,139 52,105 

Liabilities & own funds 

Fixed-income portfolio payable 0 0 0 0 0 0 61 744 805 

Financial liabilities at amortised cost 17,609 17,034 9,359 1,179 64 73 40 3,828 49,185 

Other liabilities 0 0 0 0 0 0 0 536 535 

Own funds 6 195 54 72 0 0 0 1,252 1,579 

Total Liabilities and Own Funds 17,615 17,229 9,413 1,251 64 73 101 6,360 52,105 

Off-balance-sheet transactions 7,598 534 -7,242 223 -266 -450 28 -425 0 

Total interest rate gap 9,325 -10,320 1,590 503 268 104 175 -1,646 0



In addition, dynamic simulation tools are used to ascertain the sensitivity of the 

Bank's interest margin, in both the short and medium term, to various scenarios 

of interest rate variations and changes in the slope of the curve. Similarly, and 

with a longer term view, the sensitivity of the Bank's economic value to interest 

rate variations is also analysed. Below are the results of these analyses at the end 

of 2007: 

Sensitivity of the interest margin (basis points) 

10.00 

5.00 

0.00 

-5.00 

-10.00 

Dec. 

07 

Jan. 

08 

Feb. 

08 

Mar. 

08 

Apr. 

08 

100 bp fall 100 bp rise 

May 

08 

Jun. 

08 

Jul. 

08 

Aug. 

08 

The following graph shows the sensitivity of the interest margin to changes 

in the slope of the curve over a time horizon of 18 months. This scenario is 

constructed by keeping the 6-month interest rate constant and varying the shortterm 

rates (up to 3 months) and the 12-month rate by the same amount and in 

the opposite direction in order to introduce a +/- 25 basis points variation in the 

slope of the curve over the period considered. 

Sep. 

08 

Oct. 

08 

Effect on the interest margin of a 

parallel shift of +/- 100 basis points 

in the euro interest rate curve over a 

time horizon of 18 months: 

Nov. 

08 

Dec. 

08 

Jan. 

09 

Feb. 

09 

Mar. 

09 

Apr. 

09 

May 

09


06. Business 

105 

Sensitivity of the interest margin (basis points) 

10.00 

5.00 

0.00 

-5.00 

-10.00 

Dec. 

07 

Jan. 

08 

Feb. 

08 

Mar. 

08 

Apr. 

08 

May 

08 

Jun. 

08 

25 bp rise in slope 25 bp fall in slope 

Jul. 

08 

Aug. 

08 

At 2007 year-end the sensitivity of the economic value to parallel shifts of 

200 basis points (bp) was EUR 0.1 million. 

Liquidity risk 

Structural liquidity risk is connected with the Bank's ability to meet its payment 

obligations and to finance its lending activities. To mitigate this risk, Bankinter 

performs coordinated management of its balance-sheet assets and liabilities and, 

specifically, of its interbank assets and liabilities and of calls on the capital 

markets. 

The measures used to control liquidity risk are the liquidity gap or map and 

information and analysis regarding the specific status of the Bank's interbank and 

capital market assets and liabilities. 

Sep. 

08 

Oct. 

08 

Nov. 

08 

Dec. 

08 

Jan. 

09 

Feb. 

09 

Mar. 

09 

Apr. 

09 

May 

09



Market risk 

In addition to providing overall interest rate and liquidity risk management 

services, the Treasury and Capital Markets Division operates in the markets to 

take advantage of any business opportunities that may arise. 

To carry out these functions, the Division uses the most appropriate financial 

instruments at any given time and the necessary hedges are performed to 

mitigate market risk. The financial instruments traded must generally be 

sufficiently liquid and hedgeable. 

Each year the Board of Directors of Bankinter, S.A. approves limits and 

internal measurement procedures for the risk on each of the products and 

markets in which the Treasury and Capital Markets Division trades. 

The market risk of the Treasury and Capital Markets Division activities and 

the limits thereon are measured using the Value at Risk (VaR) methodology, 

considered both overall and separately for each significant risk factor. The limits 

in VaR terms are supplemented by other measures such as stress testing, 

sensitivities, equivalent positions and concentration. 

Specific limits are also set for credit and counterparty risk, and the markets 

in which trading is authorised are specified. The method used to determine the 

principal market risk measurements is described below.


06. Business 

107 

Value at Risk (VaR) 

Value at Risk (VaR) is defined as the maximum expected loss on a given portfolio 

of financial instruments, under normal market conditions, for a given confidence 

level and time horizon, as a result of variations in market prices and variables. 

VaR is the principal indicator used daily by Bankinter to measure and 

control, in an integrated and comprehensive manner, the exposure to market risk 

due to interest rates, equities and exchange rates in Treasury and Capital Markets 

transactions. 

VaR is calculated by the parametric model, which is based on the statistical 

assumption that changes in market prices follow a normal probability distribution. 

It is performed with a confidence level of 95% and a time horizon of one day. 

The table below shows the average and year-end VaR values of the Bank’s 

positions for 2007: 

VaR (millions of euros) 

Average Year-end 

VaR Interest rate 7.27 9.15 

VaR Equities 0.93 0.46 

VaR Exchange Rate 0.03 0.03 

Total VaR 6.91 8.92 

Level of confidence 95%. horizon 1 day



Stress Testing 

Stress Testing, i.e. the analysis of extreme scenarios, is a supplementary test to 

VaR. Stress test estimates quantify the potential loss in the value of a portfolio 

under extreme scenarios of change in the risk factors to which the portfolio is 

exposed. The stress test scenarios are obtained by analysing the behaviour of the 

risk factors in past situations of crisis, and the possible impact of a scenario of 

extreme variations in interest rates, stock market prices and exchange rates, as 

well as significant changes in volatility, is also simulated. 

The following table shows the 2007 average and year-end stress test 

estimates prepared using the scenario of extreme variations in the different risk 

variables. 

Stress Testing (millions of euros) 

Average Year-end 

Interest rate stress 111.10 108.09 

Equities stress 21.87 8.67 

Exchange rate stress 0.78 0.55 

Derivatives stress 0.63 0.74 

Total 134.38 118.05


06. Business 

109 

Credit risk 

Rigour in the risk function is a firmly established tradition at Bankinter and has 

historically been seen as one of the Bank's strengths and as a sign of identity that 

sets it apart from its competitors. This rigour has been evident both when the 

economy was expanding and at times of recession. The credit quality of the 

mortgage loan portfolio is at present a reflection of this rigour, since the risk 

policy applied in recent years has targeted a profile of high income customers 

who are more able to cope with situations of interest rate rises. In addition, the 

LTV (loan to value) of the portfolio illustrates the conservative strategy of the 

Bank, which has maintained, in contrast to the movements of the market, a policy 

of percentages that is able to cope with possible falls in the price of the assets. 

A constant feature of the Bank has always been its low level of nonperforming 

loans, which have remained consistently well below the average for 

the sector, and this has been reflected in the volume of loan loss allowances and 

in a coverage that is higher than that of other banks. 

This risk policy has always kept a balance between profitability and risk, in 

the overall and strategic sense of both terms, and as in all the other aspects of its 

management, Bankinter has always acted with total flexibility in adapting to the 

fluctuations of the economy. 

The organisational structure of the risk function at the Bank combines a 

hierarchical arrangement with the delegation of powers, seeking the optimum 

point of balance between maximum rigour and adaptation to the diversified 

demands of our customers. This combination is perfectly defined by a series of 

rules that specify responsibilities, define functions and set up spheres of 

responsibility. 

The chain of responsibilities begins with the Board of Directors which, as 

the Bank's senior body, establishes the Bankinter Group risk policy that is 

formally set out in the 'Risk policy framework agreement' approved annually.



Under this agreement it is the Board's responsibility to identify the Bank's main 

risks, to supervise the systems of control and reporting of such risks and to 

authorise or ratify credit risk transactions for amounts exceeding the delegated 

powers of other levels in the organisation. The agreement also sets out the basic 

guidelines for the operation of the different hierarchical rungs, as well as the 

orientation that the extension of credit must follow. 

As well as performing its functions as a regulator and authoriser, as 

described above, the Board of Directors is informed periodically of: 

The performance of the lending portfolio. 

Its composition by business areas. 

The exposure to major risks. 

The performance of guarantees and terms. 

And any other aspect affecting credit risk quality or which it must be notified of 

under current legislation. 

The Loans Committee is the next rung down, after the Board of Directors 

Executive Committee, with responsibilities regarding credit risk. It operates as 

part of the day-to-day activities of the Bank since it meets twice a week; 

exceptionally, when the occasion so requires, it is chaired by the Chief Executive 

Officer. 

Its functions are to: 

Determine the scope of authority that is delegated to the Credit Risk Division 

Committee, and to the loans committees of the different Regional Organisations. 

Approve the risks that are within its own scope of authority. 

Be briefed on and monitor the evolution of the lending portfolio, the sectors of 

greatest risk, the exposures in the main groups of risk and the evolution of credit 

quality, non-performing loans and substandard risk. 

Bankinter's Risk Management Department, of which the Credit Risk Division 

forms part, is directly accountable to the Chief Executive Officer, and the manager 

of the department belongs to the Bank's Management Committee. This position in 

the organisational structure seeks to achieve a three-fold objective: 

To equip the structure that monitors risk quality with the maximum strength 

and authority in line with the importance that has traditionally been attached to 

the risk function at the Bank. 

To safeguard the independence of the risk function, which must be guided in its 

actions essentially by objective criteria based on economic rigour. 

And, at the same time, to align the Bank's risk policy with its general and 

business strategy.


06. Business 

111 

The department is arranged in five different areas that match the division in 

which the business is organised and its needs, thereby setting a distinctive profile 

of what the risk function at Bankinter is: a function that is at the service of the 

banking business, providing it with rigour and security. 

Thus, within the Credit Risk Division, there are the following areas: 

The Private Individuals & Developers Risks Area, which in turn comprises two 

different businesses: 

1.- Private individuals, which handles the risk associated with mortgage loan 

transactions for home purchase, consumer transactions, cards and other risk 

transactions for the Private individuals segment. 

2.- Developers, the specific responsibility of which is to analyse and approve 

risk transactions for this customer segment, and to study and monitor the 

sector as a whole in order to forecast its developments and outlook. 

The Corporate Banking Risks Area, which analyses and approves risk transactions 

for Corporate Banking customers, risks arising in the Treasury Room, as well as 

other credit risks in other areas of the Bank. It also studies and researches the 

structural situation and the current state of affairs of the different economic 

sectors. 

The SME Risks Area, which analyses and approves the risk transactions of the 

SME sector, as well as defining the best procedure for accepting and monitoring 

risks in this segment, which the Bank considers strategic. 

Each of the above areas draws up the risk policy for each business segment, 

and when new products are created for commercialisation, they define the risk 

parameters of the products and design the procedures for approving and 

processing transactions. 

The Control & Recoveries Area. This is set up as an area that cuts across all the 

business segments and also all the other Credit Risk Division areas. Its most 

significant functions are to guarantee the quality of the lending portfolio and if 

any part of it suffers impairment, to endeavour to recover the positions 

concerned. The function of this area is primarily preventive and therefore some 

of its resources are for directing and managing the processes of control and 

monitoring of lending, by establishing and promoting automatic systems to make 

management more efficient and ensuring that there are sufficient controls to



guarantee the quality of the lending portfolio. Its responsibilities include 

controlling the quality of the data entered in the automatic approval systems and 

controlling the arrangement of lending transactions. But they also include 

detecting the possible future deterioration of specific loans, and taking the 

necessary steps to prevent this occurring, using mechanisms to terminate 

the positions concerned or by arranging additional guarantees that re-establish 

the risk-investment balance. 

On this basis, the Control & Recoveries Area is ideally placed to perform the 

last of its tasks: that of recovering positions that have deteriorated to the extent 

that they have moved into the general sphere of non-performing loans. To do this 

the department has available a wide range of resources arranged around a team 

of staff highly specialised in the negotiation and recovery of non-performing 

positions, who are assisted by agencies specialising in debt recovery and by a 

network of lawyers throughout Spain who take care of the rapid and efficient 

resolution of positions that are the subject of court proceedings. 

The Loan Approval Systems Area is responsible for defining and proposing 

the most appropriate systems for processing and managing customer risk. Its 

main function is to maintain the current systems for processing and managing 

risks, ensuring that they incorporate the best practice of the industry at all times. 

This function is embodied in establishing the functional design and technical 

specification of the new Unified Risk System, which will encompass and replace 

all of the current risk systems, liaising with Information Systems over its 

construction and roll-out, and cooperating with the Comprehensive Risk 

Management Division to ensure that the new system properly incorporates the 

Bank's rating models and fully complies with the requirements of the Basel 

Accord.


06. Business 

113 

Structure of Powers 

The structure of powers responds to the three-fold need to maintain a single 

strategic line, to act with rigour and transparency regardless of the level at which 

action is being taken and to foster quality of service to customers. 

All of the bodies that hold risk powers at the Bank –the loans committees– 

are collegial, and this provides a counterweight among the different approaches 

there may be to a risk, as well as complete transparency in the information to be 

assessed and the decisions to be taken. 

On the basis of the foregoing, the bodies with risk management powers are 

arranged as follows: 

The Board of Directors. 

The Board of Directors Executive Committee. 

The Loans Committee. 

The Credit Risk Division Loans Committee. 

The different risk committees of the regional organisations; these latter 

restricted according to type of risk and term. 

The loans committees of organisations, which may delegate powers, within 

defined limits, to the different centres that report to them.



Performance 

Composition of the lending portfolio by segments 

Private individuals 

Total exposure 

20,943 

million euros 

+8% 


Private banking 


3,914 

million euros 

+39% 


The composition of the lending portfolio remained essentially similar to that 

of 2006. 

Bankinter's total credit risk exposure amounted to EUR 42,999 million at 31 

December 2007 which was 15% more than in 2006. 93% of this credit risk related 

to direct lending to customers and 7% to off-balance sheet risks. 

Mortgage-secured credit risk, mostly home mortgages, continued to account 

for a very substantial portion of the Bank's total risk exposure at 62%. 35.6% of 

the total exposure is in the corporate entities segments - Corporate Banking and 

SMEs - as a result of the marked strategy of diversification. 

Corporate 


7,729 

million euros 

+11% 


Mortgage-secured 

credit risk: 10% 

Foreign nationals 


861 

million euros 

+19% 


SMEs 


7,466 

million euros 

+23.5% 


Mortgage-secured 

credit risk: 45% 

Consumer finance 


344 

million euros 

+30% 


Personal 


1,742 

million euros 

+37% 

more than in 2006


06. Business 

115 

One of the most important details of the performance of the portfolio was the 

strong growth in the Private Banking and Personal Finance segments of 39% and 

37%, respectively. This growth reflects the Bank's strategic commitment to these 

segments, of which not only the quantitative but also the qualitative importance 

must be highlighted, since both divisions have higher income customers to whom 

it is possible to offer transactions of great added value for the Bank. 

Property Development 

Noteworthy here is the fact that only 3.7% of our lending is linked to property 

development, compared with 17% at other banks (per latest available Bank of 

Spain data), which places Bankinter in a position of clear advantage over its 

competitors when it comes to facing the crisis in the sector, of which the first 

serious symptoms were already becoming apparent in the year covered by this 

report. 

The most distinctive features of our credit risk portfolio would be as follows: 

Diversification of risk. 

High percentage of mortgage-secured credit risk. 

Careful selection of customers, giving priority to high income borrowers and 

businesses that are firmly established and less vulnerable to economic cycles. 

These signs of identity, which make up a healthy whole that is minimally 

exposed to the turmoil that affected the economy in 2007, have been achieved 

thanks to a policy that is clear as regards risk and which it has been possible to 

implement as a result of Bankinter's huge technological capability (evidenced 

most notably in the automatic approval systems), and a team of highly trained 

and experienced people that was considerably strengthened in 2007. The 

combination of technologies and highly qualified people, typical of Bankinter, has 

made it possible to accompany the commercial and growth strategy without any 

adverse effect on the quality of either risk or customer service.



Proof of the foregoing is to be found in the performance of the non-performing 

loans ratio, which has remained at exceptionally low levels despite rising to 0.4% 

in 2007 from 0.3% in 2006. This increase in non-performing loans was due 

mainly to the process of slowdown of the economy which, in the case of 

Bankinter, was felt most severely in the Consumer Finance and SME segments. 

Even so, if we compare Bankinter's non-performing loans ratio with that of the 

rest of the banks (private sector residents), which is 0.7% according to the latest 

data available, we reach the conclusion that the Bank's lending portfolio is one of 

the soundest in the market. Taking this figure in conjunction with our loan loss 

allowances, which are much higher than those of other banks, we find that if the 

economic slowdown is confirmed or worsens, Bankinter will be able to face it in 

better conditions than those of our competitors. 

Non-performing loans and allowances (millions of euros) 

600 

+8.2% 

500 

400 

300 

200 

100 

0 

600% 

570% 

500% 

400% 

300% 

Dec. 

06 

Jan. 

07 

Allowances NPL 

Feb. 

07 

Mar. 

07 

Apr. 

07 

Variations in coverage ratio (%) 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

Apr. 

07 

May 

07 

May 

07 

+66.5% 

Jun. 

07 

Jun. 

07 

Jul. 

07 

Jul. 

07 

Aug. 

07 

Aug. 

07 

Sep. 

07 

Sep. 

07 

Oct. 

07 

Oct. 

07 

Nov. 

07 

Nov. 

07 

575 

155 

Dec. 

07 

370% 

Dec. 

07


06. Business 

117 

Analysis of doubtful credit risk (thousands of euros) 

2006 2007 variation % 

Risk exposure ex-securitisation 37,448 42,999 5,551 14.8 

Doubtful risk 93 155 62 66.5 

Total allowances 531 575 43 8.2 

Mandatory allowances 531 575 43 8.2 

General 500 523 23 4.6 

Specific 31 52 20 65.4 

Non-performing loans ratio ex-securitisation (%) 0.25 0.36 0.11 45.0 

Non-performing loans ratio (%) 

Non-performing loans ratio: mortgage 

0.27 0.38 0.11 40.7 

portfolio ex-securitisation (%) 0.12 0.18 0.06 46.1 

Non-performing loans coverage ratio (%) 

Unsecured non-performing loans 

570 370 -200 -35.0 

coverage ratio (%) 418.35 295 -123 -29.4 

Private Individuals 

There was no change in the credit policy applied in the segments comprising 

private individuals in 2007. The 14% increase in risk was based on mortgages 

arranged with medium-high income customers. 

The sale of mortgages continued to be accompanied by a strategy based on 

the cross-selling of products which has enabled us to provide our customers with 

better and more comprehensive services while also creating value for the Bank. 

The statistical tools that the Bank has make it possible to add the 

profitability of each customer to the risk assessment of the transaction, both 

product by product and overall, which means that they take into account both the 

risk variables and the profitability of the mortgage customer, adding cross-selling 

to the results. 

Mortgage-secured credit risk accounted for 56.08% of the total risk 

exposure, which was similar to the figure for 2006. 

The unfavourable performance of the property sector in 2007, the continuing high 

price of housing and the rise in interest rates made it advisable for the Bank 

to adopt a policy of prudence that was even stricter than usual. Thus, 

particular attention was paid in the efforts made to attract new customers to 

especialmente en cuenta su nivel de renta y su capacidad para soportar posibles



their level of income and their ability to withstand possible rises in interest rates. 

At the same time, we were selective as regards the location of the housing, 

focusing our efforts on areas that were less vulnerable to downward swings in 

prices because they were firmly established or offered advantages as regards their 

situation. All without lowering our guard regarding the amount financed as a 

percentage of the appraised value, which means that at present we have a 

mortgage portfolio in which the loan to appraised value ratio is 57.7%. 

In support of the foregoing we can add that the number of mortgage loans 

for which the loan to appraised value (LTV) ratio is higher than 80% has fallen 

significantly in the recent years, from more than 25% in 2003 to the current 

steady 6%. 

Home mortgages. Variation in effort & LTV (%) 

100 

80 

60 

40 

20 

0 

Dec. 

03 

Appraised value >80% 

Jul. 

04 

Jan. 

06 

Nov. 

06 

Appraised value >80%+effort >40% 

May 

07 

Nov. 

07 

Effort >40% Appraised value


06. Business 

119 

If we analyse the mortgage risk from the point of view of the effort that customers 

must make to meet the payments, measured as the portion of their income that 

borrowers allocate to payment of their mortgage loans, we find that the average 

effort for the new mortgage lending in 2007 was 37% (calculated on customers' 

net income), compared with 35.4% in 2006, as a result of the rise in interest rates 

and in house prices. However, this increase is not such a cause for concern, given 

our target customer profile - more than 70% of our new mortgage customers are 

high profile, which means they have a net annual disposable income of over EUR 

40,000. Accordingly, the customers' net disposable income is still sufficient to 

meet the mortgage payments even in the event of further interest rate rises. 

Variation in mortgage customer profile (%) 

80 

60 

40 

20 

0 

1998 2000 2003 2005 2007 

High Medium Low 

Profile of home mortgage portfolio (%) 

2006 2007 

Average loan (euros) 100,976 109,413 

Primary residence 89.9 89.5 

% of household income (net) 30.2 33.2 

Loan/Appraised value 58.5 57.8 

Non-performing loans ratio 0.12 0.17



In 2007, 84.5% of Bankinter's home mortgages were processed using the 

Automatic Approval System, compared with 76.6% the previous year, and 59% 

were approved automatically compared with 54% in 2006. 

The widespread introduction of automatic approval, which makes it possible 

to achieve better implementation of the risk policy in retail products such as 

mortgage loans, has served to standardise the conditions required for the product 

sale, thereby achieving excellence in customer service, since the transaction is 

approved on-line. 

Since 2003, this system has applied the rule that the rating assigned to 

each of the transactions by the internal mortgage model must be included as a 

variable for determining automatic approval. The statistical model, which 

combines an approval tree with a regression, determines the likelihood of default 

on transactions. In September 2007 the internal approval systems risk policy 

model was updated for new loans. 

One important figure that confirms the success of our mortgage loans policy 

is that of the non-performing loans ratio in this segment, standing at 0.2%, when 

the figure for the Spanish banking system as a whole is 0.6% (per latest available 

AHE data). 

0.60 

0.50 

0.40 

0.30 

0.20 

0.10 

0.0 

May 2004 May 2005 May 2006 December 2007 

System Bankinter 

0.62% 

0.26% 0.17%


06. Business 

121 

The credit policy applied in the property developers' business had as its objective 

that of customer subrogation, understanding customer to mean a person who 

buys a house for their personal use, not a person who buys it as an investment. In 

consequence, when assessing the risk in this segment, special consideration was 

given to the prior existence of sale contracts, with mere reservations being 

considered insufficient. 

Another of the keys when considering the risk in this segment was the 

requirement for the customer to contribute funds to the development project. It is 

also crucial to have an adequate finance and coverage structure, with the former 

not exceeding 70% and always providing first homes were involved. 

In all cases the Bank took care over the customer profile, requiring that as a 

minimum they should be professionals of the sector, with substantial experience, 

and have housing development as their principal activity. 

Finally, a determining factor was whether the developments were in prime 

locations, the land was fully developed and the purchasing customer profile was 

one of medium-high income. 

Given the extreme prudence with which the Bank has proceeded in this 

segment, the amount of the loans to developers represents 3.7% of the total credit 

risk, which is lower than the average for the system by some way, because we 

consider this business to involve greater risk and volatility in the event of a 

change in the economic cycle.



Corporate Banking 

Total lending in this segment amounted to EUR 7,729 million, an increase of 11% 

over 2006. The principles and objectives that governed the extension of credit in 

Corporate Banking were as follows: 

Lending for specific purposes, placing the emphasis on the long-term 

relationship with customers, thereby making it possible to bond them in their 

collections and payments circuit. 

The capacity to generate cash-flow was always a determining variable in 

decision-taking. 

For the approval of transactions systematic use was made of rating models that 

link cash-flow generation and the asset structure of the business and expert 

analysis. 

Efforts were made to diversify the portfolio by sectors, avoiding those of a 

speculative nature. 

The share of risk exposure by customer was subject to the limitation that 

Bankinter should not be the only financer, without detriment to us being the 

preferred Bank. 

In structured finance, the tradition of providing it to long-standing 

customers of the Bank was maintained, and 57 transactions were authorised for a 

total of EUR 592 million, although subsequently the amount signed for was EUR 

235 million. Transactions of this type have an average term of 9 years and an 

average margin of 1.5%, they are not concentrated in any specific sector and the 

average amount per transaction is EUR 6 million. 

The matrix by terms and amounts shows that 71% was financing at terms 

of under 1 year and that the risk at terms of over 3 years - which rose from 21% 

to 23% - was highly diversified by amount, with no more than 30% in individual 

risks of more than EUR 6 million. 

Breakdown of loans and receivables (%) 

Relative ≤ 150,000 150,000 600,000 3 million > 6 million Total 

600,000 3 million 6 million 

≤ 3 months 2 6 11 4 10 33 

3-12 months 3 8 11 4 11 38 

12-36 months 2 1 1 0 1 6 

> 36 months 2 4 8 2 8 23 

Total 9 19 31 10 30 100 

The use of ratings is a basic element in the approval of transactions. They 

are included in the discussions on transaction authorisation and are used to preclassify 

customers in certain products, greatly facilitating the Bank's commercial 

activities.


06. Business 

123 

SMEs 

The strategic focus on the SME segment initiated by the Bank in 2004 continued 

strongly in 2007. 37 new centres were opened during the past year, taking the 

total to 161. 

The opening of new centres and the consolidation of the existing centres 

was reflected in the growth of all the parameters of this segment. Thus, the 

number of active customers rose by 18%; the volume of loan applications by 15%, 

and the credit risk by 24%, ending the year at EUR 7,466 million. 

The particular caution used in handling credit risk in the SME segment led 

to the proportion of mortgage-secured credit risk remaining high (over 45%); and 

more specifically, the percentage of home mortgage-secured credit risk was 33%. 

The principles governing the extension of credit risk in this segment were 

as follows: 

Diversification by customer, avoiding the concentration of risks, which has 

resulted in most of our customers, specifically 73%, having risks of less than EUR 

150,000. Taking the amount up to EUR 600,000, 92% of the customers accounted 

for 54% of the risk. 

Diversification by sector, which gives greater capacity to adapt to fluctuations in 

the economy.



The generation of a collateral business based on the customer's collections and 

payments transactions. 

The consideration of the company's experience and years of existence as a 

counterweight to the volatility of this type of business. 

The economic and financial involvement of the partners. 

The widespread use of automatic approval systems, incorporating the customer's 

rating as an indicator of the probability of default, which has served, among other 

things, to assist the commercial network in selective customer attraction. 

The rating is the basic measurement throughout the procedure of customer 

admission. 

Introduced into management in 2004, it is proving to be a fundamental pillar of 

the growth in this segment, which is a strategic one for the Bank. The system for 

rating customers is based on a specific decision tree for each of the categories 

established in the Basel accord. The risk policy in 2007 was focused on more 

selective risk attraction, and the rating is the base on which this policy has 

been built. 

The existence of an Automatic Approval System makes it possible to process 

and approve a large number of transactions (automatic approvability remained 

steady at 62%, with automatic authorisation accounting for 43% of the total 

transactions processed). These automatic procedures have demonstrated not only 

their agility but also their appropriateness for maintaining risk quality, since the 

non-performing loans ratio for transactions that were automatically approved was 

0.7% compared with 0.8% for the segment as a whole. 

Of particular importance was what is called the 'Chronos Project', the 

objective of which is to eliminate any inefficiencies that may occur in the 

processing of transactions, starting with their commercialisation and ending with 

the filing of the documentation. The implementation of the different 

enhancements addressed involved:


06. Business 

125 

1.- Introducing technology for digitalising documents at the form completion 

stage. Especial énfasis a la tecnología de OCR (Software que se Special emphasis 

on OCR technology (optical character recognition software that extracts the 

characters of a text from an image and saves them in an editable text format), 

which makes it possible to automate certain types of documents and avoid the 

need to key them in manually, as well as enabling us to ensure the reliability of 

the data entered in the system. 

2.- Obtaining pre-authorisations for all the SME customer groups. Based on 

rating models and supported by statistical simulations, pre-authorisation models 

were generated during 2007 for the different SME customer groups, thereby 

enabling us to have our customers pre-rated and to offer them financing with 

processes that have already been generated, thus attaining greater efficiency 

than would be possible with a traditional procedure. 

3.- Integrating the approval systems with the accounting pre-additions. The 

duplication of input data that have already been entered in the Bank's systems is 

identified at different stages in the procedure, but because the different tools are 

not linked, they are not integrated and therefore have to be entered again. We 

are focusing on this point and succeeding in connecting up the risk systems with 

the accounting systems so that the data that are common to both applications can 

be integrated automatically. In addition to saving on manual data input, potential 

errors and conflicts between the data used for approval and those used for 

formalisation are avoided. 

4.- Monitoring the entire procedure using Workflow tools. 

The objective is to integrate in a single tool all of the systems involved in the SME 

asset procedure, so that we can monitor the procedure, swiftly identify 

inefficiencies or bottlenecks, control and modify roles and procedures in an almost 

on-line manner.



Non-performing loans, risk control and monitoring 

The progress made in the Risk Control and Monitoring Area in 2007 was two-fold: 

on the one hand, the department monitored closely the positions which could 

initially pose the greatest risk of default and, of course, those that did become 

non-performing; and, on the other, prompted by the clear signs of slowdown of 

the economy, new tools were added and designed to enable us to be properly 

prepared to face a future framework that, as all the indicators are pointing to, will 

very probably be one of growth in the number of non-performing loans. 

A characteristic that has become an inherent feature of our way of 

operating in this area is that of early warning. A large proportion of our efforts 

continued to be directed at preventing the impairment of our positions by means 

of techniques and tools that are able to detect warning signs and securing the 

supplementary measures to avoid it. 

These preventive tools included the following: 

Centre alerts: With a complex system of parameters, these detect centres 

with an above average tendency to present bad debt problems. These centres, 

once detected, would be supervised and monitored by senior authorities until the 

measurement parameters that triggered the alarm return to normal. 

Chain of control: Each of the Bank's centres automatically has a risk status 

report, and must take action with each of the customers depending on the reason 

for their inclusion in this chain. 

Customer alert system: This is a statistical tool that provides a score for 

each customer, making it possible to identify those most likely to default on their 

contractual obligations. The resulting classification makes it possible to design 

specific actions for these groups of customers before default occurs. 

Variation in customers subject to alert (%) 

4 

3 

2 

1 

0 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

Apr. 

07 

May 

07 

Jun. 

07 

% risk subject to alert customers subject to alert 

Jul. 

07 

Aug. 

07 

Sep. 

07 

Oct. 

07 

Nov. 

07 

Dec. 

07 

2.5 

2.0 

1.5 

1.0


06. Business 

127 

Substandard customer risk rating system, 'to be watched' and 'to be 

terminated'. This tool provides an automatic rating of customers based on 

objective variables indicating the deterioration of their creditworthiness, taking 

into account both internal information and information from external databases. 

Undoubtedly the most noteworthy feature of this tool is that it is incorporated in 

the daily functioning of every branch, which can, depending on the result 

provided by the tool, either closely monitor a customer's evolution or directly take 

action to terminate the credit relations with them. 

Lack of early warning overall (%) 

50 

40 

30 

20 

10 

0 

1Q 

06 

2Q 

06 

3Q 

06 

4Q 

06 

Centre reviews: For clearly preventive purposes, 307 (51% of the Bank's total) 

centres were reviewed by the Central Services with the aim of ascertaining in 

detail all of the aspects concerning the risk of each branch: ranging from approval 

to control, and including the use and application of the different tools. As a result 

of these reviews, appropriate measures were taken for each centre: training in the 

control and approval of transactions, recommendations for monitoring by Internal 

Audit, the Risk Division or some other department of the Bank, etc. These actions 

were fully completed in 2007. 

Rating: 2007 was definitive as regards the introduction of the rating culture in the 

management of credit risk. The reviews led to a change in the ratings of 396 

customers, most of them in the SME segment, giving rise to different customer 

monitoring measures and, in some cases, leading to steps to terminate the Bank's 

relations with certain customers. 

1Q 

07 

2Q 

07 

3Q 

07 

4Q 

07



Data processing: In view of the high percentage of transactions that are approved 

automatically, it is essential to have in place a system that verifies and validates 

the data. The Data Reliability System (FIDA in Spanish) was set up to do this 

several years ago and it performs monthly reviews of random samples of 

transactions. A project was undertaken in 2007 to enhance the FIDA's data 

processing capability. 

People policy and training: Realising that even the best technical resources and 

preventive measures are insufficient to manage risk at any time, but especially at 

times like the present of economic and financial turmoil, we followed a firm policy 

of increasing the staff devoted to Risk Control and Management, and at the same 

time of ensuring that they were highly qualified. In 2007 there was a 100% 

increase in the number of people involved in these functions. The staff 

recruitment procedure took into account two qualities that we consider are 

essential at the present time: technical knowledge focusing particularly on the 

handling of critical risks and experience in economic and financial crises. 

In order to compact the teams and to transmit and utilise the knowledge 

accumulated by some of them, an ambitious training plan was put into effect 

during 2007 by the Credit Risk Division focusing particularly on the people who 

handle SMEs, one of the segments most prone to bad debts. Most of this training 

was given by the Division's own staff, which meant it was of an essentially 

practical nature and dealt with the problems that the people being trained would 

be facing in their daily work. Of the figures that reflect the efforts made in this 

aspect we should like to highlight the following: 858 people trained and a total of 

7,762 hours of training, i.e., each person received an average of 9 hours of 

training. 

Lastly, our Risk Control and Monitoring teams were reinforced and had the 

assistance of a network of lawyers and legal administrators who provided advice 

on the legal options under discussion at each moment. 

There was an in increase in non-performing loans in 2007 to EUR 155 

million, from EUR 93 million in 2006, and the non-performing loans ratio rose to 

0.4% from 0.3%. By business segments, the biggest increases were in SMEs and 

Consumer credit, which was in line with the patterns of evolution of the economy 

in general.


06. Business 

129 

Non-performing loans 

2006 2007 

Beginning balance 71,998 93,243 

Net additions 7,524 48,374 

Delinquent balances 13,721 13,652 

Ending balance 93,243 155,269 

Mention should be made of the following characteristics of Bankinter's nonperforming 

loans portfolio: 

It is half the average of banks as a whole, which stands at 0.7%. 

The bad debts are located mainly in the SME segment and Consumer credit, 

where the risk premiums are higher, which offsets the cost of the non-performing 

loans. However, it should be taken into account that 45% of the lending to SMEs 

has a mortgage guarantee. 

The non-performing loans ratio of the home mortgages portfolio is of scant 

significance: 0.2%. 

There is hardly any lending to developers –3.7% of our lending compared with 

17% for the rest of the Bank's - we have no non-performing loans in this business. 

The variation in non-performing loans by segment was as shown in the 

following chart: 

Non-performing loans ratio by segment (%) 

0.70 

0.60 

0.50 

0.40 

0.30 

0.20 

0.10 

0.00 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

SMEs Private individuals 

Apr. 

07 

Foreign Nationals Private banking 

May 

07 

Jun. 

07 

Consumer credit 

Jul. 

07 

Aug. 

07 

Sep. 

07 

Corporate banking 

Oct. 

07 

Nov. 

07 

Dec. 

07



Having said this, in 2007 we were able to refine both the preventive tools referred 

to earlier and the tools for recovering delinquent positions. 

Our recovery procedures are set in motion as soon as a position registers an 

incident, the amount of time allowed for handling non-performing loans amicably 

has been drastically cut, and new resources have been used to handle amicable 

resolution. 

The staff dedicated to recovery make up a closely-woven network that 

originates in the branch where the incident has occurred and immediately passes 

to the people specialising in this type of work: the Division staff, debt recovery 

agencies, lawyers and legal administrators. All of the professionals who form part 

of this chain have a two-fold objective: to collect the debt as quickly and as 

efficiently as possible. These objectives are quantified for the Bank's personnel, 

and achievement of them is taken into account in their pay.


06. Business 

Distribution of credit risk by internal category (%) 

Project finance 3.0% 

Very large companies, 13.0% 

Large companies, 12.5% 

Medium-sized companies, 7.9% 

Small companies, 1.8% 

131 

Internal risk scoring models 

2007 brought, on the one hand, the consolidation of the application in 

management of the advanced risk scoring models developed in previous years 

and, on the other, the continuation of the development and implementation of 

new models for the risk portfolios that were not yet covered by the advanced 

models. All of these models are currently undergoing the rigorous process of 

validation by the Bank of Spain. 

During the year, with the aim of achieving more accurate risk scoring and 

being able to apply a differentiated risk policy, two new portfolios were set up: 

For private individuals a separate portfolio of 'second mortgages' was set up. 

For corporate entities a separate portfolio was set up for 'very big companies' 

with sales of over EUR 50 million. 

The relevant advanced models were developed for these two portfolios, and 

they are currently in the process of being validated internally and by the 

supervisor. The models developed cover 90% of the total customer credit risk 

exposure. 

Other legal entities 

4.3% 

Home mortgages - 

individuals 46.1% 

Other individuals 

10.9%



The internal rating models provide, for each category, a score or rating of the risk 

assumed by the Bank vis-à-vis each customer or transaction. Each of these ratings 

is associated with a certain probability of default (past due by more than 90 days) 

and, accordingly, the higher the rating, the lower the probability of default. The 

probabilities of default, or PDs, shown in the graphs were obtained by applying 

statistical techniques to 16 years of historical data. This means that the results 

obtained reflect all the economic cycle data, including the worst situations 

occurring from 1990 to 2006. Consequently, when calculating the expected loss 

and the capital requirements a criterion of maximum prudence is applied. 

For each risk category, whether relating to private individuals or corporate 

entities, the range of the probability of default associated with the rating of each 

of them is different. In order to compare the various credit risk categories, 

Bankinter has developed an internal master scale that gives a value in the scale 

(from 0 to 100, where 0 is the worst value and 100 the best) to a segment of the 

default probability. The 'home mortgage loans' category is the one with the 

lowest probabilities of default and, accordingly, this category is at the higher end 

of the master scale. 

Distribution of risk per the master scale. Private Individuals (thousands of euros) 

7,000 

6,000 

5,000 

4,000 

3,000 

2,000 

1,000 

0 

90-100 80-89 70-79 60-69 50-59 40-49 30-39 20-29 0-19 

Master scale 

Mortgage loans Other transactions with private individuals Credits & loans to private individuals


06. Business 

133 

Distribution of risk per the master scale. Corporate entities (thousands of euros) 

4,000 

3,000 

2,000 

1,000 

0 

90-100 80-89 70-79 60-69 50-59 40-49 30-39 20-29 0-19 

Master scale 

Big companies Medium size companies Small companies Very big companies 

Bankinter has historical default databases that permit calculation of the severity 

(the average default recovery rate) and exposure at the time of default for each 

one of the categories. 

The probability of default, the severity and the exposure are the three 

factors required to calculate the expected or probable loss on each loan. The 

loss associated with a transaction will be the result of the probability of each 

transaction being in default within one year (probability of default), multiplied by 

the transaction's exposure at the time of default (exposure) and by the percentage 

loss in the event of default (severity). 

The expected loss is a key factor in estimating the risk premium that should 

be passed on in the price as an additional cost of the business activity. 

As in the probabilities of default, the data used to calculate the exposure 

and the severity were obtained by applying statistical techniques to the scenarios 

of greatest economic recession in the current economic cycle (historical data going 

back to 1990). In addition, volatility coefficients were applied that ensure the 

criterion of maximum prudence in preparing the expected loss data. 

The estimates calculated by Bankinter of the probability of default, the 

severity and the exposure and, therefore, of the expected loss, disclose the 

excellent quality of the Bank's portfolios. For example, in the mortgage portfolio, 

76.0% of the exposure had a rating of 5 or higher, and the expected loss on the 

portfolio as a whole in situations of recession was 0.2% of the risk exposure.



Distribution of home mortgages by rating (%) 

20 

15 

1.20 

1.00 

0.80 

10 

0.60 

5 

0.40 

0.20 

0 

0.00 

Risk 1 2 3 4 5 

Rating 

6 7 8 9 Expected 

Loss 

Risk 

20 

15 

10 

5 

0 

Expected loss A rating of 9 indicates maximum credit quality and 1 indicates the worst 

Distribution of the portfolio of unsecured credits and loans to private 

individuals by rating (%) 

Risk 1 2 3 4 5 6 7 8 9 Expected 

Loss 

Rating 

Risk Expected loss 

20 

15 

10 

5 

8.00 

6.00 

4.00 

2.00 

0.00 

A rating of 9 indicates maximum credit quality and 1 indicates the worst 

Distribution of the portfolio of other transactions with private 

individuals by rating (%) 

0 

0.00 

Risk 1 2 3 4 5 

Rating 


Loss 


1.50 

1.00 

0.50 

A rating of 9 indicates maximum credit quality and 1 indicates the worst


06. Business 

135 

Distribution of the small companies portfolio by rating (%) 

25 

20 

15 

10 

5 

25 

20 

15 

10 

5 

20.00 

15.00 

10.00 

0 

0.00 

Risk 1 2 3 4 5 

Rating 


Loss 

Risk Expected Loss (%) A rating of 9 indicates maximum credit quality and 1 indicates the worst 

Distribution of the medium size companies portfolio by rating (%) 

30 

25 

20 

15 

10 

5 

5.00 

20.00 

15.00 

10.00 

0 

0.00 

Risk 1 2 3 4 5 6 7 8 9 Expected 

Rating 

Loss 

Risk Expected Loss 

Distribution of the big companies portfolio by rating (%) 

0 

0.00 

Risk 1 2 3 4 5 6 7 8 9 Expected 

Rating 

Loss 

Risk Expected Loss 

5.00 


6.00 

5.00 

4.00 

3.00 

2.00 

1.00 

A rating of 9 indicates maximum credit quality and 1 indicates the worst



Distribution of the very big companies portfolio by rating (%) 

30 

8.00 

25 

7.00 

20 

6.00 

5.00 

15 

4.00 

10 

3.00 

5 

2.00 

1.00 

0 

0.00 

Risk 1 2 3 4 5 6 7 8 9 Expected 

Rating 

loss 



The fact that the expected losses in a situation of economic recession are so low is 

due not only to the quality of the transaction acceptance systems, but also to the 

excellent systems and methods of recovery of transactions that go into default. 

As the following graphs show, 76.8% of the transactions with private individuals 

were recovered within 365 days of their original default. For the same period, the 

percentage of transactions with corporate entities recovered was 56.2%. 

Private Individuals. Non-performing balances recovered (%) 

100% 

90% 

80% 

70% 

60% 

50% 

40% 

30% 

20% 

10% 

0% 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 

Quarter 

Balance recovered 

76.84 

82.96


06. Business 

137 

Corporate entities. Non-performing balances recovered (%) 

100% 

90% 

80% 

70% 

60% 

50% 

40% 

30% 

20% 

10% 

0% 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 

Quarter 

Balance recovered 

56.17 

59.86 

Developers 

2007 saw the consolidation of the use of the internal rating of residential property 

development financing transactions by means of the completion by expert 

analysts of an assessment questionnaire. 

The statistical processing of these assessments classifies transactions in this 

portfolio into four categories, with 'weak' being the worst and 'strong' the most 

favourable. The breakdown of classifications shows that 82% of the transactions 

achieved 'good' or 'strong' as a result. 

Breakdown of the property development portfolio (%) 

80% 

70% 

60% 

50% 

40% 

30% 

20% 

10% 

0% 

Weak Acceptable 

Classification 

Good Strong



Economic capital 

The economic capital is a quantitative risk measurement designed to measure all 

the quantifiable risks of an institution in a consistent and comprehensive manner. 

It can be defined as the potential unexpected loss of an institution over a time 

horizon of one year, with a statistical level of confidence (determined on the basis 

of the rating desired by the bank) taking into account all the main classes of 

risks. 

Economic capital methodologies provide an institution with uniform risk 

measurements for enhanced decision-taking regarding business strategy, 

management of risk concentrations and diversification (mobilisation and hedging 

of transactions and portfolios), capital planning and management of risk-adjusted 

prices and returns. 

They are also the cornerstone of management that, in accordance with 

Pillar II of the Basel II framework, takes into account the dimension of all the 

significant risks, their evolution and the assessment of current and foreseeable 

capital requirements based on the Bank's nature and business plans, and also 

make it possible to perform stress tests in adverse potential scenarios. 

In 2007 Bankinter continued to make progress in its knowledge and 

application of economic capital measures, evaluating the sensitivity of the model 

used to different risk hypotheses and parameters, and its reasonableness in its 

different potential applications such as stress testing, assessment of capital 

adequacy, pricing and returns policies. These methodologies are the subject of 

ongoing learning and adjustment to the different aspects of management, 

maintaining in each case the proper conservative and precautionary approach. 

One of the economic capital applications is to permit the Bank to visualise 

in uniform terms the composition of its quantifiable risks. In this respect, the 

composition of the economic capital by type of risk in December 2007 was as 

follows:


06. Business 

139 

Contribution to economic capital with type of risk (%) 

ALM, 6% 

Business, 10% 

Operational, 8% 

Credit, 74% 

Market, 2% 

Risk-adjusted return 

One of the most important applications of the new risk quantification 

methodologies is that they make it possible to introduce uniform credit risk 

measurements into management, such as probability of default, severity, 

exposure, expected loss and economic capital. In turn, these measurements make 

it possible to consider credit risk premiums in the different systems for calculating 

the profitability and assessing the economic performance of the business units. 

Bankinter was the first bank in the Spanish market to develop, in 1981, an 

analytical accounting system that enabled it to ascertain the profitability of its 

various products, customer segments and business units. Since then the Bank has 

continued to enhance these systems and their application to the business, within 

the framework of a culture of decentralised and flexible prices and management 

that constitutes one of its main competitive advantages. Apart from that, since 

1990, the Bank has been developing and using different credit transaction scoring 

and mechanised approval systems, which are now further enhanced with this 

additional information on quantitative measurements of credit risk. 

At the present moment, therefore, both the Bank's systems and its culture 

are in a privileged position to continue, in a natural way, to incorporate risk 

quantification in the setting of prices and the management of the customers and 

the businesses.



Operational risk 

At Bankinter the formal definition of 'operational risk' is taken to be that laid 

down in the new Basel Capital Accord: 'the risk of incurring losses as a result 

either of inadequate or faulty processes, personnel or internal systems, or due to 

external events. It includes legal risk and excludes strategic risk and also 

reputational risk'. 

In 2007, operational risk became a much more integral part of the Bank's 

daily management. All of the Bank's areas had to review their maps, reflecting 

the current situation of the risks they had already identified, incorporating new 

risks as appropriate and reporting on the progress of the actions for improvement 

and the plans for mitigation undertaken. 

The significance of operational risk was also enhanced by the introduction 

of a new protocol which obliges all the areas which generate products to 

document that they have taken into account the necessary activities and 

participants, and also sought the agreement of all of them. With this new way of 

operating the aim is to ensure that every launch is made without any operational 

risk due to delays or shortcomings. 

In turn the Operational Risk Committee continued with the work begun 

after it was set up in November 2006, mainly aimed at deciding on the corrective 

measures for the most critical risks borne by Bankinter and that are disclosed in 

the comprehensive map. It is perfectly qualified for this task, since it is composed 

of the managers of the areas most involved in operational risk, either because 

they are the designers of products or processes, or because they are in charge of 

the main operating systems, processes or departments. 

With a view to preventing critical risks and following the Basel 

recommendations, Bankinter has a panel of indicators that trigger alerts when 

undesirable trends appear. These were improved in 2007 with the inclusion of 

new data illustrating the evolution of the Bank's structure, procedures, activities 

and staff.


06. Business 

141 

Lastly, the Loss Data Base is what completes the information necessary to meet 

the requirements of the standard method for calculating capital envisaged in 

Basel II and taken on by Bankinter. This tool incorporates as an operational loss 

any negative impact on the income statement or in the company's balance sheet 

situation that is reflected in the accounts and is a consequence of an operational 

risk event. 

The figures below illustrate the types of losses with which Bankinter ended 

the year: 

Operational losses by type of risk (Basel classification) (%) 

System failures, 4% 

Customer practice, 4% 

Process execution, 35% 

Operational losses by business line (Basel classification) (%) 

Retail intermediation, 8% 

Asset management, 9% 

Payment & settlement, 

11% 

External fraud, 57% 

Retail banking, 72%


143 

A record year for earnings, with an 

increase in net profit of 73.6% 

over 2006. 

The Bank's profit before tax 

was EUR 484.5 million, which was 53.2% 

more than in 2006. Highlights were the 

strong pace of growth in the business 

with customers, the customary strength 

of the recurring income and an NPL ratio 

of 0.4%, which was again well below 

the average for the sector. 

07 

Earnings 


> Earnings 

> Bankinter’s Contribution to GDP


07. Earnings 144 

Total assets 

€49,649 

million 

7.8% 


The Bankinter Group ended 2007 with record 

profits. These are particularly commendable 

results, bearing in mind that they were 

achieved despite the uncertainties triggered 

in the markets by the liquidity crisis. 

Earnings 

Bankinter's balance sheet recorded progress in all its aggregates. At year-end the 

total assets amounted to EUR 49,649 million, an increase of 7.8%. Customer funds 

ended the year at EUR 38,774 million, an increase of 18.6%. At EUR 37,580 

million, the Bank's loans and receivables recorded year-on-year growth of 18.7%. 

The total figure for loans and receivables, ex-securitisation, was EUR 39,923 

million, an increase of 16%. 

Bankinter presented a strong pace of growth in the business with customers 

and the customary strength of its recurring income, as illustrated by figures such 

as that of the net interest income of EUR 587.9 million, which was 24.1% more 

than in 2006; or the fee and commission income, which contributed EUR 244.15 

million to the income statement, with a year-on-year increase of 12.5%. 

The operating costs reflected the substantial investment effort made in the 

course of the year to increase the commercial capabilities in the business 

segments which are the priority of the Bank's strategy. Consequently there was a 

marked increase in the total number of employees: in December 2007 there were 

4,530, which was 13.8% more than in 2006; and a sharp increase in the number 

of centres, of which there were 619 at the end of the year, an increase of 13.2%.


07. Earnings 

145 

With regard to doubtful risk, this totalled EUR 155.3 million, and accounted for 

0.4% of the Bank's computable risk exposure, which is much lower than that of 

Spanish banks as a whole. There were total loan loss allowances of EUR 574.9 

million, which was 8.2% more than in 2006 and meant that the non-performing 

loans coverage ratio stood at 370%. Both the non-performing loans ratio and the 

coverage ratio are confirmation of the high credit quality of the Group's assets and 

also its solvency, both of them based on the now traditional internal systems for 

the analysis, approval and automatic management of risk, the diversification of 

the portfolio, very limited exposure to property development, the conservative 

provisions allocated to loan losses, and the virtually zero exposure to country risk. 

As a result of this, the Bank was able to achieve a net profit of EUR 361.9 

million, which was 73.6% more than at 2006 year-end. The profit before tax was 

EUR 484.5 million, an increase of 53.2%. This profit includes a series of nonrecurring 

earnings: the sale to Mapfre of the Bank's 50% stake in the life 

insurance business, generating capital gains of EUR 114.8 million after tax, and 

the acquisition of Capital One’s 50% stake in the joint venture with the Bank, 

among others. Consequently, the Bank's net profit 'ex-extraordinary earnings' was 

EUR 272.2 million, an increase on 2006 of 31%. And the figure for profit before 

tax 'ex-extraordinary earnings' was EUR 380.3 million, which was 20.2% more 

than in 2006.



Comparative statements of income (thousands of euros) 

2006 2007 Difference 

Amount Amount Amount % 

Interest and similar income 1,455,871 2,152,135 696,264 47.82 

Interest expense and similar charges -998,591 -1,583,575 (584,984) 58.58 

Of which: return on equity having the substance of a financial liability -11,139 -15,182 (4,043) 36.30 

Income from equity instruments 16,354 19,334 2,980 18.22 

Total net interest income 473,634 587,894 114,260 24.12 

Share of results of entities accounted for using the equity method 29,623 41,153 11,530 38.92 

Net fees and commissions 217,119 244,149 27,030 12.45 

Insurance activity income 1,694 2,588 894 52.77 

Gains on financial assets and liabilities and exchange differences 97,532 74,070 (23,462) -24.06 

Gross income 819,602 949,854 130,252 15.89 

Personnel expenses -227,336 -298,294 (70,958) 31.21 

Other general administrative expenses -174,940 -214,036 (39,096) 22.35 

Depreciation and amortisation of tangible and intangible assets -24,151 -24,978 (827) 3.42 

Other operating income 18,471 17,830 (641) -3.47 

Net operating income 411,646 430,376 18,730 4.55 

Asset impairment losses -96,898 -75,633 21,265 -21.95 

Provisions -5,892 11,575 17,467 -296.45 

Other income 7,480 118,144 110,664 1,479.47 

Profit before tax 316,336 484,462 168,126 53.15 

Corporate income tax -107,846 -122,599 (14,752) 13.68 

Profit attributed to the Group 208,490 361,863 153,374 73.56 

Average total assets 43,264,333 48,126,612 4,862,279 11.24


07. Earnings 

Quarterly income statements (thousands of euros) 

147 

2007 2006 

December September June March December 

Interest and similar income 603,186 559,615 514,552 474,782 442,608 

Interest expense and similar charges -461,243 -408,825 -374,785 -338,722 -314,756 

Of which: return on equity having the substance of a financial liability -3,474 -3,471 -3,431 -4,806 -4,247 

Income from equity instruments 6,466 2,817 2,979 7,072 1,851 

Total net interest income 148,409 153,607 142,746 143,132 129,703 

Share of results of entities accounted for using the equity method 11,687 10,462 9,110 9,894 6,241 

Net fees and commissions 61,954 60,807 61,814 59,574 59,794 

Insurance activity income 0 0 980 1,608 1,869 

Gains on financial assets and liabilities and exchange differences 16,464 9,720 25,624 22,262 19,672 

Gross income 238,514 234,596 240,274 236,470 217,279 

Personnel expenses -78,162 -70,348 -89,847 -59,937 -62,523 

Other general administrative expenses -68,471 -48,866 -51,741 -44,958 -51,494 

Depreciation and amortisation of tangible and intangible assets -7,074 -6,396 -6,074 -5,434 -6,639 

Other operating income 5,004 3,662 4,906 4,258 5,525 

Net operating income 89,811 112,648 97,518 130,399 102,148 

Asset impairment losses -28,795 -2,674 -29,489 -14,675 -31,244 

Provisions 6,978 -313 230 4,680 -7,173 

Other income -1,716 -20,927 141,035 -248 2,118 

Profit before tax 66,278 88,734 209,294 120,156 65,849 

Corporate income tax -19,020 -25,269 -43,321 -34,989 -34,406 

Profit before tax 47,258 63,465 165,973 85,167 31,443



Operating profitability (% of average total assets) 

2006 2007 

Total & average assets 100.00 100.00 

Interest and similar income 3.37 4.47 

Interest expense and similar charges 

Of which: return on equity having the substance of a 

-2.31 -3.29 

financial liability -0.03 -0.03 

Income from equity instruments 0.04 0.04 

Net interest margin 1.09 1.22 

Share of results of entities accounted for using the equity method 0.07 0.09 

Net fees and commissions 0.50 0.51 

Insurance activity income 0.00 0.01 

Gains on financial assets and liabilities and exchange differences 0.23 0.15 

Gross income 1.89 1.97 

Personnel expenses -0.53 -0.62 

Other general administrative expenses -0.40 -0.44 

Depreciation and amortisation of tangible and intangible assets -0.06 -0.05 

Other operating income 0.04 0.04 

Net operating income 0.95 0.89 

Asset impairment losses -0.22 -0.16 

Provisions -0.01 0.02 

Other income 0.02 0.25 

Profit before tax 0.73 1.01 

Corporate income tax -0.25 -0.25 

Profit attributed to the Group 0.48 0.75


07. Earnings 

Customer segments PAT 

€305 

million 

29.3% 


149 

Measures of return by business area 

Although all of the segments of the customer business experienced substantial 

growth in profit, especially noteworthy were the earnings of those which 

Bankinter considers strategic and in which the Bank continued to invest 

significantly during 2007: SMEs and those comprising the customers with the 

highest net worth: Private Banking and Personal Finance. 

The SME segment experienced an increase of 41.9% in its profit after tax, 

and also recorded increases of 27.3% in lending, 29.4% in funds and 17.5% in 

active customers. The profit after tax of Private Banking and Personal Finance 

grew by 27.8% and 29.2%, respectively, year on year. 

Measures of return by business area (thousands of euros) 

2006 2007 Amount % 

Customer segments 236,009 305,046 69,037 29.25 

Personal Finance 25,542 33,014 7,471 29.25 

Private Banking 44,983 57,498 12,515 27.82 

Corporate Banking 52,439 68,755 16,316 31.11 

Banking for Private Individuals 71,830 86,930 15,100 21.02 

SMEs 34,955 49,602 14,647 41.90 

Foreign Nationals 6,259 9,248 2,989 47.75 

Capital market 31,603 37,668 6,065 19.19 

Other businesses 46,422 150,369 103,947 223.92 

General loan loss allowance -57,013 -30,524 26,490 (46.46) 

Corporate Centre -48,530 -100,697 -52,167 107.49 

PAT attributed to the Group 208,490 361,863 153,373 73.56% 

Yields and costs 

The table of yields and costs shows a breakdown of the net interest income, 

taking into account the relative weight and rates of the assets and liabilities in 

the balance sheet.



Yields and costs (thousands of euros) 

Balances with central banks 

Loans and advances to credit institutions 

Loans and advances to customers (a) 

Debt instruments 

Hedges 

Equities 

Average earning assets 

Other assets 

Average total assets 

Deposits from central banks 

Deposits from credit institutions 

Money market operations through counterparties 

Customer funds (c) 

Customer deposits 

Debt certificates including bonds 

Subordinated liabilities 

Hedges 

Average 

2006 

Relative Yields & Average 

Balance weight (%) costs rate % 

383,995 0.89 7,801 2.03 

4,561,843 10.54 127,756 2.80 

28,735,672 66.42 1,077,621 3.75 

6,869,571 15.88 240,197 

2,496 

3.50 

453,487 1.05 16,354 3.61 

41,004,569 94.78 1,472,225 3.59 

2,259,764 5.22 

43,264,333 100.00 1,472,225 3.40 

141,621 0.33 3,896 2.75 

8,579,860 19.83 256,115 2.99 

126,339 0.29 3,191 2.53 

29,613,974 68.45 711,178 2.40 

16,703,127 38.61 317,346 1.90 

12,910,847 29.84 393,832 3.05 

490,150 1.13 21,349 

-8,277 

4.36 

Return on equity having the substance of a financial liability 347,211 0.80 11,139 3.21 

Average interest-bearing funds (d) 

39,299,156 90.83 998,591 2.54 

Other liabilities 

3,965,177 9.17 

Average total funds 

43,264,333 100.00 998,591 2.31 

Customer spread (a-c) 

366,443 1.35 

Net interest income (b-d) 

473,634 1.05 

Evolution of customer spread (%) 

5 

4 

3 

2 

1 

0 

Dec. 

06 

Jan. 

07 

Customer spread 

Feb. 

07 

Mar. 

07 

Apr. 

07 

May 

07 

Average 

2007 

Relative Yields & Average 

Balance weight (%) costs rate % 

461,753 0.96 14,311 3.10 

5,625,544 11.69 221,216 3.93 

34,378,902 71.43 1,660,991 4.83 

5,307,228 11.03 210,855 

44,762 

3.97 

467,335 0.97 19,334 4.14 

46,240,764 96.08 2,171,469 4.70 

1,885,848 3.92 

48,126,612 100.00 2,171,469 4.51 

195,724 0.41 9,153 4.68 

7,241,663 15.05 272,811 3.77 

48,110 0.10 1,736 3.61 

36,024,994 74.85 1,262,009 3.50 

20,677,519 42.96 604,097 2.92 

15,347,475 31.89 657,912 4.29 

599,402 1.25 28,864 

-6,180 

4.82 

348,765 0.72 15,182 4.35 

44,458,658 92.38 1,583,575 3.56 

3,667,954 7.62 

48,126,612 100.00 1,583,575 3.29 

398,982 1.33 

587,894 1.13 

Jun. 

07 

Jul. 

07 

Aug. 

07 

Return on lending Cost of customer funds 

Sep. 

07 

Oct. 

07 

Nov. 

07 

Dec. 

07


07. Earnings 

151 

Analysis of operating costs 

Total operating costs were EUR 519.5 million, up 27.3% on 2006. This was the 

result of the strategy for growth being implemented by the Bank, involving the 

expansion of the branch network, mainly of those dedicated to SMEs, and bigger 

investment in a series of businesses which will contribute to the future growth of 

the Bank. 

Personnel expenses rose by 31.2% year on year to EUR 298 million. The 

Bank's workforce increased by 549 employees to a total of 4,530 staff at the end of 

2007, which was 13.8% more than in 2006. 

In December 2007 the Board of Directors of Bankinter decided to redeem 

early all of the convertible debentures held by employees that were outstanding 

at that date. The conversion took place on 10 January. However, the full cost of 

the early accrual of the implicit options was booked under personnel expenses for 

2007, for a total amount of EUR 3.9 million. 

General expenses rose, by 22.3%, and totalled EUR 214 million at year-end. 

The growth in centres and employees was reflected in the efficiency ratio, 

which stood at 53.9% at year-end, with an increase of 4.9 points on 2006. As the 

investments made in increasing the commercial capabilities progressively mature, 

this ratio will substantially improve as a result of the greater capacity for 

generating ordinary income. 

Línea Directa Aseguradora earnings 

Línea Directa achieved excellent results in 2007, despite the intense competition 

there is in the insurance sector. It ended the year with a premium volume of EUR 

644 million, an increase of 3.1%. The attributable profit was up by 16.6% year on 

year at EUR 34.3 million. The company had 1,431,327 policies at the end of 2007. 

Previously focused exclusively on automobile insurance, the company 

successfully launched its new home insurance in the last quarter of 2007. It 

remains in the vanguard as regards innovation and technology, and is the 

number one direct insurer in automobile insurance, while occupying sixth place in 

the general insurers league table for this branch of insurance.



Operating costs (% of total) 

Variation 07/06 

2006 2007 Amount % 

Personnel expenses 55.73 57.42 1.69 3.03 

Salaries and wages 39.02 37.68 -1.34 -3.43 

Social Security costs 8.80 8.01 -0.79 -8.98 

Other expenses 7.90 11.73 3.83 48.48 

Other operating income -5.88 -4.82 1.06 -18.03 

Other general administrative expenses 42.88 41.20 -1.68 -3.92 

Buildings, fixt. & other fixed assets 11.40 10.57 -0.83 -7.28 

Information technology 13.72 11.81 -1.91 -13.92 

Other expenses 17.76 18.83 1.07 6.02 

Depreciation, amortisation & writeoffs 5.92 4.81 -1.11 -18.75 

Other operating expenses 1.36 1.39 0.03 2.21 

Total 100.00 100.00 0 0.00 

Operating costs (thousands of euros) 


2006 2007 Amount % 

Personnel expenses 227,336 298,294 70,958 31.21 

Salaries and wages 159,192 195,735 36,544 22.96 

Social Security costs 35,916 41,634 5,718 15.92 

Other expenses 32,229 60,925 28,696 89.04 

Other operating income -24,003 -25,035 -1,032 4.30 

Other general administrative expenses 174,940 214,036 39,096 22.35 

Buildings, fixt. & other fixed assets 46,513 54,893 8,379 18.01 

Information technology 55,957 61,339 5,383 9.62 

Other expenses 72,470 97,804 25,334 34.96 

Depreciation, amortisation & writeoffs 24,151 24,978 827 3.42 

Other operating expenses 5,532 7,205 1,673 30.24 

Total 407,956 519,478 111,522 27.34


07. Earnings 

Contribution to GDP 

€839 

million 

27% 


153 

Bankinter’s Contribution to GDP 

Bankinter’s contribution to GDP in 2007 amounted to EUR 839 million, which was 

27% more than in 2006. This contribution was made up as follows: 

Surplus retained at the Bank (depreciation and amortisation, reserves and 

allowances): EUR 297 million. 

Remuneration of equity (dividends): EUR 118 million, 16% more than in 2006. 

Direct contribution to the State (corporate income tax): EUR 123 million. 

Employee salaries: EUR 297 million, 29% more than in 2006. 

Direct economic value generated and distributed: The economic indicators 

discussed in this chapter make it possible to evaluate how Bankinter generates 

wealth and distributes it among its stakeholders and society in general. 

Direct economic value generated and distributed (thousands of euros) 

2006 2007 Amount 07/06 (%) 

Direct economic value generated 1,261,417 1,763,112 501,695 39.77 

a)Income 1,261,417 1,763,112 501,695 39.77 

Economic value distributed -1,068,181 -1,487,672 -419,491 39.27 

b)Operating costs -203,932 -245,773 -41,840 20.52 

c)Employee remuneration -222,808 -292,177 -69,369 31.13 

d)Payments to capital suppliers -528,376 -820,560 -292,185 55.30 

e)Taxes -111,269 -126,439 -15,170 13.63 

f)Investments in the community -1,796 -2,724 -927 51.62 

Economic value retained 193,236 275,440 82,204 42.54

08 

Shareholders’ equity 

and the Bankinter share 


> Shareholders’ equity 

> The Bankinter share 

> Market return 

One of the best performing banking 

equities of the year, with an 

annual return that was above 

that of the main indexes. 

The market continued to give the Bank 

a premium over its main competitors, 

as a sign of shareholder confidence in the 

future performance of the Bank, 

of the higher rating of its solvency and 

its intangible assets.


155


08. Shareholders’ equity and the Bankinter share 156 

Shareholders' equity 

The Bankinter Group has a sound and efficient structure of shareholders’ equity, 

and creating value for shareholders in the long term is one of the Bank's strategic 

priorities. Accordingly, the Bank conducts appropriate equity management by 

assigning these scant assets to activities that generate the greatest possible 

returns. 

In accordance with the principles of the Bank for International Settlements 

(BIS) in Basel, the capital structure totalled EUR 2,874 million, as set out in the 

following table. 

Shareholders' equity (thousands of euros) 


2006 2007 Amount % 

Core capital 

Capital & reserves 1,534,882 1,802,466 267,584 17.43 

Minority interests 343,165 343,165 0 0.00 

Revaluation reserve -104,147 -102,431 1,716 -1.65 

Treasury shares -1,048 -55,754 -54,706 5,220.04 

Intangible assets -48,829 -86,235 -37,406 76.61 

Tier 1 1,724,023 1,901,211 177,188 10.28 

Supplementary capital 

Revaluation reserve 104,147 102,431 -1,716 -1.65 

General allowances 498,597 537,851 39,254 7.87 

Subordinated financing 313,952 366,234 52,282 16.65 

General loan loss allowance -119,467 -33,624 85,843 -71.86 

Tier 2 797,229 972,892 175,663 22.03 

Total capital 2,521,252 2,874,103 352,851 14.00 

Risk-weighted assets 25,116,180 30,089,988 4,973,808 19.80 

Tier 1 (%) 6.86 6.32 -0.54 -7.87 

Tier 2 (%) 3.17 3.23 0.06 1.89 

Capital ratio (%) 10.03 9.55 -0.48 -4.79 

Capital cushion 511,958 466,904 -45,054 -8.80


08. Shareholders’ equity and the Bankinter share 

157 

The Bankinter Group shareholders' equity was strengthened in 2007 by EUR 353 

million: 

EUR 177 million came mainly from the increase in Tier 1 capital, due to the 

increase in the retained earnings. 

EUR 176 million came from the increased general allowances and the issuance of 

subordinated bonds. 

Pay-out (%) 

60 

50 

40 

30 

20 

10 

0 

2003 2004 2005 2006 2007* 

*ex-extraordinary earnings 

Bankinter continues to have a robust capital structure that is endorsed by 

the principal rating agencies, which once again gave the Bank an excellent rating. 

The ratings awarded by the principal rating agencies are as follows. 

Ratings 

Short term Long term 

Moody's P-1 Aa3 

S&P A1 A 

Fitch F1 A+ 

The Bankinter Group is working on the development and future application 

of the models based on internal ratings, following the methodology laid down 

under the Basel II Accord and supervised by the Bank of Spain. 

The new regulations came into force on 1 January 2008 and we are 

expecting a positive impact arising out of lower credit risk usage given the 

historically low level of default and the conservative profile of our portfolio.



The Bankinter share gave shareholders 

a return of 7.8%. 

The Bankinter share 

The 5.3% appreciation of the Bank's shares in 2007 combined with the dividend 

paid meant that shareholders obtained a total return of 7.8%. 

Bankinter's shares were among the best performing of banking equities in 

the year, and obtained an annual return that was above that of the main indexes. 

The following graph compares the performance of the Bankinter share 

(5.3%) with the Ibex 35 (7.3%), the DJ Banks (-16.9%) and the Euro Stoxx 50 

(6.8%) indexes. 

Bankinter compared with main stock market indexes 

125 

120 

115 

110 

105 

100 

95 

90 

85 

80 

75 

Dec. 

06 

Jan. 

07 

Feb. 

07 

Mar. 

07 

Apr. 

07 

May 

07 

Jun. 

07 

Jul. 

07 

Aug. 

07 

Bankinter Ibex 35 DJ Euro Stoxx 50 DJ Stoxx 600 Bank 

Sep. 

07 

Oct. 

07 

Nov. 

07 

Dec. 

07



159 

The salient per share data for Bankinter stock in 2007 are disclosed in the 

following tables: 

Per share data (euros) 

2006 2007 % 07/06 

Net earnings per share 0.54 0.92 70.37 

Cash flow per share 0.78 1.05 35.90 

Book value per share 

Market price: 

3.90 4.45 13.85 

Low 9.25 9.55 

High 12.36 14.94 

Closing 11.92 12.55 

Stock market ratios 

Times 2006 2007 

P/E ratio (Price/earnings) 22.46 13.62 

PCF (Price/cash flow) 15.32 11.91 

Price/Book value 3.05 2.82 

Dividend yield (%) 2.18 2.38 

Both the earnings per share and the book value per share increased in 

2007, and this favourable performance was translated into a higher share price, 

reflecting the higher value of the business. 

With regard to stock market ratios, the market continued to give the Bank a 

premium over its main competitors, as a sign of shareholder confidence in the 

future performance of the Bank, of the higher rating of Bankinter's solvency, as 

well as the valuation of a series of other intangible assets. 

Earnings per share were EUR 0.9, an increase of 70.4% year on year. The 

dividend for 2007 was EUR 0.3, which was 15.0% more than in 2006.



On 13 March 2008, the Board of Directors of Bankinter approved the formulation 

of the annual financial statements and also a dividend out of 2007 income of 

EUR 0.078108 per share for a total approximate amount of EUR 31.4 million 

(estimated amount based on data at 31/12/2007), signifying a dividend yield of 

2.4%. The pay-out in 2007 was 32.8%. 

Dividends 

Date DPS Nº of shares Amount Date of Board 

(euros) (euros) approval 

Jul-07 0.071346 396,773,435 28,308,197 20/06/2007 

Oct-07 0.073531 396,282,600 29,139,056 12/09/2007 

Jan-08 0.075831 392,692,910 29,778,296 19/12/2007 

Apr-08 0.078108 401,710,680 31,376,818 13/03/2008 

Total 0.298816 118,602,367 

ADRs 

ADRs are a product that allows residents of the United States of America to invest 

in foreign companies by means of a certificate of deposit, an ADR, and to receive 

dividend payments in the manner most convenient to them. Bankinter's ADR 

programme is administered by the Bank of New York. From the beginning of 

2007, four ADRs corresponded to one Bankinter share. Since the split performed 

on 23 July, the ratio changed again and one ADR went back to representing one 

ordinary share. 

Share Capital and Treasury shares 

As of 31 December 2007, Bankinter, S.A.’s share capital consisted of 396,876,110 

fully subscribed and paid shares of EUR 0.3 par value each. In 2006 this figure 

was 78,585,044 shares and the par value was EUR 1.50 per share. This difference 

is due to fact that in June 2007 the Board of Directors approved a split in the par 

value of the shares from EUR 1.5 to EUR 0.3. This reduction in the par value 

became effective on 23 July, on which date each share with a par value of EUR 1.5 

became 5 shares with a par value of EUR 0.3 each. The purpose of this 

transaction, which was of a merely technical nature and without cost, was to 

facilitate the volume and trading of the shares on the market.



161 

Bankinter’s employees hold a total of 

10,334,218 shares, i.e. 2.6% 

of the share capital. 

Also, as discussed in the previous chapter, in December 2007 the Board of 

Directors decided to redeem early all of the employees' convertible debentures. 

This transaction, as recorded in the registers of the Spanish National Securities 

Market Commission (CNMV), gave rise in January 2008 to 9,017,770 new shares. 

All the shares are represented by book entries, are listed on the Madrid and 

Barcelona stock exchanges and are traded by the Spanish computerised trading 

system. 

In 2007 the share capital was increased by 790,178 shares (before the 

split), amounting to an increase of EUR 1,185,267, relating to the conversion of 

Convertible Debenture Issues I and V. There was a EUR 23 million increase in the 

share premium in 2007, due to the difference between the face value of the 

debentures converted and the par value of the shares issued. The increase in this 

connection in 2006 was EUR 19 million. 

Bankinter has 79,529 shareholders. The main features of the shareholder 

structure are as follows: 

Resident shareholders own 302,202,302 shares, representing 76.2% of the share 

capital. 

Non-resident shareholders own 94,673,808 shares, representing 23.9% of the 

share capital. 

The members of the Bank’s Board of Directors hold, directly or indirectly, 

69,466,125 shares, representing 17.5% of the share capital. 

Bankinter’s employees hold a total of 10,334,218 shares, i.e. 2.6% of the share 

capital. 

There was treasury stock at year-end of 4,183,200 shares. 

Shareholders of record holding more than 10% of the share capital at 2007 yearend 

are detailed in the following table: 

Shareholders with an ownership interest of more than 10% 

Name Total Shares % 

Casa Kishoo S.A. 58,217,870 14.67 

Cartival S.A. 64,082,430 16.15



Directors’ stakes in share capital 

Name No. of directly-owned shares No. of indirectly-owned shares Total % of share capital 

Pedro Guerrero Guerrero 2,504,999 75,005 0.6501 

Jaime Echegoyen Enríquez de la Orden 559,725 4,970 0.1423 

CARTIVAL S.A. 64,082,430 0 16.1467 

Marcelino Botín-Sanz de Sautuola y Naveda 100,212 0 0.0253 

Fernando Masaveu Herrero 374,952 * 0.0945 

José Ramón Arce Gómez 1,585,793 38,060 0.4092 

John de Zulueta Greenebaum 83,817 0 0.0211 

Fabiola Arredondo de Vara 56,162 0 0.0142 

* In January 2008 Tudela Veguin S. A. (a company whose Chairman is Fernando Masaveu Herrero) notified the Spanish National Securities Market Commission (CNMV) of its status 

as a significant shareholder of Bankinter S. A. on the basis that it was more in line with the new regulations (Royal Decree 1362/2007) to attribute to the company the shares held 

by him (5.251%). 

Share ownership structure by number of shares 31/12/2007 

Brackets No. of shareholders % No. of shares % 

1-100 shares 46,441 58.39 446,366 0.12 

101-1,000 shares 19,388 24.38 8,790,264 2.20 

1,001-10,000 shares 11,832 14.88 37,576,119 9,47 

10,001-100,000 shares 1,675 2.11 41,319,459 10.41 

Over 100,000 shares 193 0.24 308,743,902 77.80 

Total 79,529 396,876,110 

Summary by type of shareholder 

No, of shareholders % No, of shares % 

Residents 79,070 99.42 302,202,302 76.15 

Non-residents 459 0.58 94,673,808 23.85 

Total 79,529 396,876,110



163 

At 2007 year-end, the Bankinter Group had 4,183,200 shares of treasury stock, as 

compared with 17,789 shares in 2006 (88,945 with the split) and 909,320 in 2005 

(4,546,600 with the split). 

Share capital and treasury shares (%) 

2002 2003 2004 2005 2006 2007 

January 1.86 1.82 1.33 1.31 1.17 0.02 

February 1.86 1.82 1.33 1.20 1.17 0.03 

March 1.86 1.82 1.32 1.20 1.17 0.02 

April 1.86 1.82 1.32 1.19 1.16 0.02 

May 1.82 1.82 1.32 1.18 1.16 0.02 

June 1.82 1.63 1.32 1.18 0.75 0.03 

July 1.82 1.70 1.31 1.18 0.58 0.02 

August 1.82 1.70 1.31 1.19 0.41 0.02 

September 1.82 1.70 1.31 1.18 0.02 0.15 

October 1.82 1.57 1.31 1.16 0.00 0.09 

November 1.82 1.47 1.31 1.16 0.02 0.95 

December 1.82 1.33 1.31 1.17 0.02 1.05



Market capitalisation (millions of euros) 

5,000 

4,000 

3,000 

2,000 

1,000 

0 

Market return 

Bankinter’s share price rose by 5.3% in 2007 to close the year at EUR 12.6. This, 

combined with the dividend yield of 2.4%, meant that the Bankinter share 

obtained a return of 7.8% in the year. 

Over the past 10 years the market capitalisation of the Bank has risen at an 

average annual rate of 23.2%. In 2007 it rose 6.3%. 

1970 1990 1998 2002 2007


Brand 

165 

Bankinter's vision is 

to improve the quality of life 

of our customers and, 

in this way, generate value 

for all the Bank's shareholders 

in the medium term.


Brand 166 

2007: 

A year of transformation 

Times change, the environment evolves and inevitably demands 

that we evolve too. Just as the Bank's business strategy has 

evolved in recent years, so too is our brand strategy evolving. 

In 2007 we began the roll-out of our new visual identity, with 

which Bankinter is evolving and showing that it continues to be 

a bank that is different. And that 'being different' is present in 

everything it does and in how it does it. 

What we are doing 

For more than a year now we have been working on a brand 

strategy to strengthen our identity and make it increasingly 

relevant and attractive to our audiences within the Spanish 

financial sector. 

With our spirit and the way we are, Bankinter wants every day 

to show that it is different, because being different is an asset 

that sets people thinking.


Brand 168 

> 

Our brand 

Is based on a different and clear idea: 

‘thinking’; tied to a coherent set of values and 

with a distinctive personality. 

It is three-dimensional: the brand idea, the 

values, the personality are not merely a veneer, 

but permeate each aspect of the organisation: 

products and services, environment, 

communication and conduct. 

It is aspirational, while at the same time 

pragmatic, with something ambitious in 

everything it offers, giving good reasons for 

standing out among competitors. 

The strong values that set Bankinter apart from the rest are in 

everything it says, everything it does and everything it achieves. 

Agility 

We are and must always be more able to provide solutions, 

quicker and more efficient than the other banks. We take 

nothing for granted. We act. We identify opportunities. We adapt 

to a society that is on the move. We seek to give effective 

answers. 

Enthusiasm 

We do not stop. We innovate to change the way things are done, 

and we apply intelligence to the search for solutions for our 

customers. We do it with energy 

and in a spirit of self-improvement. 

Integrity 

We have quite clear that we are responsible for the impact of our 

actions on society. Although it is something that is taken for 

granted in the sector, we like to reaffirm our honesty in our way 

of thinking, speaking and acting. 

We understand the true meaning of transparency and we strive 

to demonstrate it every day. We are honest and transparent with 

our customers and with ourselves. 

Quality is our objective. 

To think with integrity. To think of everything and everyone. 

Originality 

We think and we act differently. We are stubbornly different, 

and we look for ways to be unique. It’s logical, if we are 

different, for our bank to propose something original. To be 

different. To make simple products. To apply big initiatives to the 

small details.


Brand 

Our effective brand 

management 

Brand management at Bankinter, as in the rest of 

the financial sector, carries increasing weight as a 

strategic asset. It is a fact that in companies where 

the management team engage in branding issues 

and funds are allocated to brand management, the 

companies' value increases, in turn increasing the 

value for the shareholders. 

At Bankinter, effective brand management is 

based on the efforts of everyone to do things differently, 

to have clear criteria that are well known, 

and to apply them faithfully. 

For this purpose we have designed tools and 

mechanisms to help us in this management, such 

as a 'Brand Book' and a 'Brand Guide', of which all 

Bankinter staff have copies; a Brand website, containing 

everything to do with Bankinter's identity; 

a Brand Committee, which meets once a quarter 

and is chaired by the Chief Executive Officer; the 

'Brand Tutors', who monitor the management and 

the care taken of the brand in the organisations; 

and the 'Brand Module', which has been incorporated 

in all the Internal Audit procedures. 

169 

Brand management is an 

ongoing process of change; 

it adapts to changes 

in the market in order 

to achieve distinction 

and differentiation in the 

minds of our audiences. 

In the course of 2007 we were the protagonists of a very 

important change for the Bank; a change which seeks to make 

Bankinter better every day and, in short, to ensure that in a very 

competitive sector it is always a strong, relevant and attractive 

brand. 

We have spent a year on efforts to re-invent ourselves and to 

convey what we are. We have changed the way our customers, 

our shareholders and society in general see us, with a firm 

objective: for them to see as we really are, a bank that is 

different. 

During this time, Bankinter has concentrated on ensuring that 

all the points of contact with our customers, shareholders and 

employees radiate the new visual identity and its values: a 

brand that is innovative, fresh, relevant and different. 

It can be seen on 

television 

The point of sale 

encapsulates the brand 

It can be seen in the 

street 

The seller lives and 

breathes the brand 

The brand is present in 

the face-to-face 

banking business 

The packaging is part 

of the brand 

The brand can be 

accessed via the Internet 

The brand attracts 

potential employees 

Advertisements and 

communication in the 

press reflect the brand 

and its tone of voice 

The brand permeates 

the head offices and 

buildings 

Letters and even bills 

communicate the 

brand 

The employees and 

customer care services 

transmit the brand


Brand 170 

Our branches: 

a Bankinter experience 

Our principal point of contact with customers is undergoing this 

great change. At the end of 2007 there were more than 100 

branches with a new exterior visual identity, promising an 

absolutely distinctive experience.


Brand 

171 

Branch = experience 

Branch = brand value 

To make this a complete 

experience, in the course of 

2008 our branch interiors will 

be evolving in a similar 

manner as the exteriors. In 

this way, being and appearing 

will be synonyms at Bankinter.


Brand 172 

More new developments: 

In addition to being and 

appearing, it is important 

to be heard... 

In addition, this year Bankinter now has for the 

first time a sound identity, which strengthens 

recognition of our brand in different situations 

and environments, and before different 

audiences. In short, the sound identity is 

another component of the corporate identity 

based on the brand idea and values. 

Similarly, we have also launched a 

‘corporate aroma’.


Brand 173 

For Bankinter this was an 

important milestone which 

recognises the effort that is 

being made in the brand 

management sphere. 

The brands listed on this 

occasion share common 

elements which set them apart 

from other companies in their 

sector, and they stand out 

because of their great 

dynamism, ability to innovate 

and strong growth. 

Most of the companies in this 

league table belong to the 

services sector, including 

banks and savings banks, and 

they are using branding as a 

strategy for differentiation. 

Bankinter was included for the first time 

in the league table of Best Spanish Brands 

in 2007, drawn up by Interbrand. 

Best Spanish brands 2007 

Ranking by economic value 

Brand value 2007 

Position Brand Sector (millions of euros) 

1 Movistar Telecommunications 12,236 

2 Santander Financial services 9,362 

3 BBVA Financial services 7,736 

4 Telefónica Telecommunications 6,185 

5 Zara Fashion 4,112 

6 El Corte Inglés Distribution 1,930 

7 la Caixa Financial services 1,594 

8 Banco Popular Financial services 1,516 

9 Repsol Energy 721 

10 Mango Fashion 702 

11 Mahou Beverages 674 

12 Iberdrola Energy 670 

13 Caja Madrid Financial services 551 

14 Banco Sabadell Atlántico Financial services 515 

15 Mercadona Distribution 398 

17 Bancaja Financial services 394 

18 El País Media 376 

19 Banesto Financial services 370 

20 Endesa Energy 345 

21 Prosegur Security 340 

22 Mapfre Financial services 324 

23 Real Madrid Leisure & sports 299 

24 Damm Beverages 294 

25 Roca Construction materials 272 

26 Holetes NH Hotels & catering 254 

27 Bankinter Financial services 239 

28 Barcelona Football Club Leisure & sports 232 

29 Acciona Construction 213 

30 Telepizza Hotels & catering 211 

* Published in Actualidad Económica magazine on 28/12/2007


175 

Appendixes


Appendixes 176 

Shareholders Office 

Pablo Santos Romero 

Pico de San Pedro, 2 

28760 Tres Cantos - Madrid 

Tel.: 913 398 330 

Fax: 913 398 323 

E-mail: ofiaccionista@bankinter.es 

Communication 

Blanca Hernanz Bodero 

Pº Castellana, 29 

28046 Madrid 

Tel.: 913 397 945 

Fax: 913 398 051 

E-mail: comunicacion@bankinter.es 

Investor Relations 

Gloria Ortiz Portero 

Pico de San Pedro, 2 

28760 Tres Cantos - Madrid 

Tel.: 913 398 256 

Fax: 913 398 320 

E-mail: gortiz@bankinter.es 

Correspondent banks 

Jose Gutiérrez Ariño 

Pº Castellana, 29 - 28046 - Madrid 

E-mail: jgutierr@bankinter.es 

Tel.: +34 913 398 134 

Fax: +34 913 397 556 

Customer Service Office (SAC) 

Cecilio Carracedo Fernández 

Avda. de Bruselas, 12 

28108 Alcobendas - Madrid 

Tel. 901 113 113 

Fax: 916 234 421 

E-mail: ccarracedo@bankinter.es 

Information for shareholders & customers 

The Statutory Annual Report of Bankinter S.A. is presented at the Annual 

Shareholders Meeting and is available to all the Company’s shareholders. 

The information it contains comprises the period 1 January-31 December 2007. 

The previous Report, relating to 2006, was published on 14 March 2006. 

This document, prepared by all the Bank's areas, is addressed to 

shareholders, customers and any other stakeholder that has dealings with the 

Bank, with no restriction whatsoever. 

Our advertising is subject to prior control by the Bank of Spain or the 

Spanish National Securities Market Commission (CNMV) and no significant 

incidents were recorded. In addition, we are members of INVERCO and have 

signed up to their 'General Code of Advertising Conduct of Undertakings for 

Collective Investment and Pension Funds'. 

Quarterly consolidated earnings reports of the Bank are issued in January, 

April, July and October and are available to shareholders. 

It is an objective of the Bank, in the medium term, to extend the scope of 

the reporting to cover the companies with significant sustainability impacts over 

which Bankinter exercises control or significant influence. 

The information contained in this report refers to all the companies over 

which Bankinter exercises control or significant influence, as listed in Note 12 

(pages 70-74) of the Group's Statutory Report, and which have a significant effect 

in relation to the preparation of this Corporate Responsibility Report, with the 

exception of Línea Directa Aseguradora, S.A. 

As far as possible and where it has been considered relevant for analysing 

trends, data for 2006 have been included in order to guarantee the completeness 

and comparability of the information. 

The changes in valuation methods made in 2007 and the recalculations 

made of certain 2006 information are due solely to the adaptation of the 

information published in this report and the necessary harmonisation of the 

year-on-year information.


Appendixes 

177 

Bankinter Telephone Banking telephone numbers 

Private individuals (service in Spanish): 901 13 23 13 

Private individuals (service in Spanish, calls from abroad): 34 91 657 88 00 

Private individuals (service in Catalan): 901 23 23 23 

Private individuals (service in Catalan, calls from abroad): 34 93 410 84 85 

Private individuals (service in English): 901 135 135 

Private individuals (service in English, calls from abroad): 34 91 657 88 01 

Private individuals (service in German): 901 12 00 68 

Private individuals (service in German, calls from abroad): 34 91 623 44 16 

Stock market specialists: 902 13 11 14 

SMEs (8:00 a.m. to 7:00 p.m., Monday to Thursday, and 8:00 a.m. to 6.00 p.m. Friday): 901 15 15 15 

SMEs (service in Catalan, 8:00 a.m. to 7:00 p.m., Monday to Thursday, and 8:00 a.m. to 6.00 p.m. Friday): 901 16 16 16 

Corporate banking (8:00 a.m. to 7:00 p.m., Monday to Thursday, and 8:00 a.m. to 6.00 p.m. Friday): 901 10 19 01 

Corporate banking (service in Catalan, 8:00 a.m. to 7:00 p.m., Monday to Thursday, and 8:00 a.m. to 6.00 p.m. Friday): 901 303303. 

Information for non-customers: 901 13 13 13 

Bankinter Telephone Banking customer service hours: 

24 hours a day, 365 days a year, you can call 901 13 23 13 to use 

the Automatic Service to make enquiries and bank transactions. 

Also, if you wish, you can request the assistance of an operator, 

Monday to Saturday from 8:00 a.m. to 10:00 p.m. (Spanish 

peninsular time), by dialling or saying ‘0’.



Board of Directors 

Current membership 

Chairman 

Pedro Guerrero Guerrero Executive 

Deputy Chairman 

Cartival, S.A. (1) External non-independent 

Chief Executive Officer 

Jaime Echegoyen Enríquez de la Orden Executive 

Directors 

José Ramón Arce Gómez External independent 

John de Zulueta Greenebaum External independent 

Fabiola Arredondo de Vara External independent 

Jaime Terceiro Lomba External independent 

Marcelino Botín-Sanz de Sautuola y Naveda (2) External non-independent 

Fernando Masaveu Herrero (3) External non-independent 

Gonzalo de la Hoz Lizcano Other External Directors 

Secretary of the Bank and of the Board of Directors 

Rafael Mateu de Ros Cerezo 

(1) Company represented on the Board by Alfonso Botín-Sanz de Sautuola y Naveda; 

Jaime Botín-Sanz de Sautuola is the significant shareholder he represents. 

(2) Related to the significant shareholder Cartival S.A. 

(3) Represents the S.A. Tudela Veguin Group


Appendixes 

Chairman 

Pedro Guerrero Guerrero 

External Communication, 

Corporate Reputation, 

Social Action and Brand 

Division 

Quality Division 

179 

Management structure 

Management Committee 

Secretary of the Bank and of the Board of Directors 

Rafael Mateu de Ros 

General Manager 

Customers & Networks 

Carlos Ruiz-Jarabo 

Deputy General Manager 

Head of Private Individuals Area: 

Fernando Moreno 

Chief Executive Officer 

Jaime Echegoyen General Manager 

People and Business Development 

Pablo de Diego 

General Manager 

Innovation 

Fernando Alfaro 


Markets & Products 

Lázaro de Lázaro 


Risks 

Ana Peralta 


Technical Resources 

Jesús Marquina 


Financial Management 

& Investor Relations 

Jacobo Díaz



Organisation Managers 

Eduardo Ozaita Vega Andalucía 

Joaquín Da Silva Castaño Balearic Islands 

Victoriano Hernández Lera Castilla 

José Luis Dionisio Cervantes Castilla-La Mancha and Extremadura 

Antonio Fayos Crespo Cataluña 

Sebastián Alvarado Díaz-Agero Las Palmas 

Guillermo Pesquera Galdós Eastern Spain 

José Luis Vega Riestra Madrid - East 

Juan Villasante Cerro Madrid - West 

Antonio Berdiel Bitrian Navarra-Aragón-Rioja-Soria 

Antonio Rodríguez Fernández Northwest 

Luis Fernando Azcona López North 

José Pérez Jiménez Tenerife

The 2007 Bankinter Report is available on CD-Rom. 

Copies can requested from the Bank's Department of External Communication 

or via the following e-mail address: comunicacion@bankinter.es 

The list of Bankinter Branches and Agents is published as an offprint of this Report. 

Published by 

Bankinter Department of External Communication 

Design, development & graphic production 

Gosban 

902 431 766 

www.gosban.com 

Legal Deposit 

B-

Bankinter SA 

Paseo de la Castellana, 29 

28046 Madrid 

T. +34 913 397 500 

F. +34 913 398 323 

Telex. 42760 BANKI E 

Swift: BKBK ES MM 

www.bankinter.com

Open Annual Bankinter Group report

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