The largest of the group’s business lines, Commercial Banking focuses on providing financial products and services to large and medium-sized businesses, SMEs, retailers and sole proprietors, individuals, occupational groupings, and bancassurance. Commercial Banking operates under the flagship SabadellAtlántico brand in most parts of Spain and also under a number of regional brand names (See Channels for a detailed list of branches).

Offers a range of products and services to large corporates and financial institutions in Spain and abroad. Its activities embrace corporate banking, structured finance, corporate finance, development capital, international trade and consumer finance.

The division offers savings and investment management services. These range from research into alternative investment products to securities market trading, and include active wealth management and custody services. The unit comprises SabadellUrquijo Private Banking, the group’s private banking arm; Investment, Products and Research; Treasury and Capital Markets; and Securities trading and custody services.

In 2012 the division adopted a fresh approach and a revamped structure to manage real estate and non-performing assets. Solvia, the company tasked with managing the group’s real estate assets, boasts a wealth of expertise in every aspect of the property development cycle. In 2013 a dedicated unit was set up for the resolution of mortgage loans to individual borrowers by taking early action in cases of default. Solvia also has a retail sales unit and sales teams specializing in putting together portfolios of assets to be offered to institutional buyers or disposing of assets with special or unusual features.

This operation comprises a number of business units, affiliates and representative offices which together provide financial services in the corporate banking, private banking and commercial banking fields. It has the capability and experience to provide a full range of banking services, ranging from highly complex and sophisticated products for large corporate clients, including structured and project finance, through to products for the individual customer. This business is conducted through Banco de Sabadell Miami Branch, Sabadell United Bank, and Sabadell Securities.

A bank operating within the Principality of Andorra in which Banco Sabadell holds a 50.97% stake. Its target customers are medium- and high-income individuals and larger companies operating in the Principality.

Significantly, 67% of the unit’s business is accounted for by large corporates. The “Cuenta Expansión Empresas” business account was launched to complete the Bank’s competitive product offering designed to win new customers. The group’s aim of increasing lending and helping businesses gain access to credit was realized through its “Plan Creciimiento” (Plan for Growth) scheme. In the area of foreign trade the Bank shown its firm commitment to supporting Spanish companies in their business ventures in foreign markets by launching its “Exports for Growth” programme.

Record figures for customer growth were achieved for the third year in succession.

Milestones: introduction of the group’s Personal Banking business model at SabadellCAM branches; increased market share in mortgage lending; growth of consumer loan approvals in 2013.

• Business focus on increasing market shares in both customer numbers and deposits.

• Leadership in ICO credit lines reaffirmed with market shares of 39.3% in Asturias and 22.2% in León.

• Loan defaults contained.

• New brand launched in November 2013.

• Incorporation of Banco Gallego branches into group and change of brand name to SabadellGallego.

• Successful drive to attract new customers, especially businesses.

• Loan defaults contained.

• Integration of processes and people (transfer of group culture and values, training, tutoring and support) - one of the year’s major challenges.

• A key aspect in customers’ quality of service perceptions: measures to equip and prepare branches to operate as part of Banco Sabadell network.

• Increased brand awareness and media presence; increase in acquisition of new customers and long-term customer relationships.

At 31 December 2013 the total volume of funds under management in insurance policies and pension funds was €12,430.8 million. Life and non-life issued premiums totalled €319.2 million.

In 2013 Bancassurance, the group’s insurance and pensions business, generated an overall net profit of €82.6 million and €64.6 million in commissions.

During the year Bancassurance worked hard to restructure its business. As a result the insurance and pensions business is now structured in the following way:

• Sabadell Vida, Sabadell Pensiones and Sabadell Seguros Generales, operating since 2008 as a joint venture in partnership with the Zurich insurance group.

• Mediterráneo Seguros Diversos operating as a joint venture with CASER since 2011.

• Mediterráneo Vida, Sabadell Mediación Operador Bancario de Seguros Vinculado and Banco Gallego Vida y Pensiones, wholly-owned subsidiaries of Banco Sabadell.

At the end of the year Banco Sabadell was operating a total of 2,418 branches, including its 2,370 branches in Spain. The distribution of these branches by region and brand name was as follows:

Two important initiatives during the last four months of the year were the setting up of an Enterprise Department and the launch of the BStartup programme. This, it is hoped, will position Banco Sabadell as the bank that caters for individual entrepreneurs and new business ventures. There was also a rise in the number of partnership agreements with professional associations other occupational groupings, an area in which Banco Sabadell is an industry leader.

At the end of the year BS Online was the online banking service most highly rated for availability of web services for individual customers of Spanish banks according to metrics produced by Eurobits, a specialist online bank benchmarking organization. BS Online Empresa, the Bank’s online banking service for businesses, ended the year in second place for business web-based services.

BS Móvil, Banco Sabadell’s smartphone banking application, held its position as one of the top eight most downloaded apps on the Spanish market (see Figure F4).

In 2013 Branch Direct, the “virtual office” part of the group’s remote banking services, continued its transformation to take on a more commercial role. Its focus on winning new customers and selling consumer finance products led to more than 13,000 new customer sign-ups and more than 6,100 loans being arranged.

During the year Branch Direct received and handled more than 2,601,000 enquiries, 61% more than in the previous year. The telephone banking service achieved a service availability ratio of 96.27% (calls answered as a proportion of calls received). Users rated the service at 4.39 on a scale from 1 to 5, based on the more than 308,649 questionnaires sent.

In 2013 Banco Sabadell continued to grow and develop its presence on social networking sites. The investment in social networking and technological innovation has been a key success area for Banco Sabadell. The group also continued to invest in customer service, sound management and quality of service, being nominated for best service on twitter in the Tweet Awards.

In the international sphere we strengthened our position in the US, where we embarked on a key project to take part in loan syndication deals in Mexico. Our new business as an operator on Spain’s alternative fixed-income market (“MARF”) made a good start.

The year saw the successful completion of four transactions in the aeronautical engineering, civil/harbour engineering, underground parking lot and real estate sectors.

Acting through two subsidiaries, Aurica XXI, SCR de Régimen Simplificado, S.A. and Sinia Renovables, SCR de Régimen Simplificado, S.A. the Bank supports the growth of non-financial companies by providing short-term capital and active assistance. This support was continued in 2013.

The Bank’s international trade business had another very busy year, thanks in part to the growth in exports. Banco Sabadell has always been a pioneer in seeking a presence in foreign markets such as China, where it has two offices (in Shanghai and Beijing), India, Singapore, Turkey, the United Arab Emirates and Algeria. Its foreign branches and offices continue to offer significant added value to the international operations of Spanish businesses. Its Casablanca branch, the first to be opened in Morocco by a Spanish bank, met all the targets set for it and continued to make solid progress.

The prolonged contraction in consumer demand did nothing to prevent SabadellFincom from continuing to grow in both revenue and market share compared with the previous year. Additionally it was able to reduce customer default levels to 4.99% and build up provisions to 105% of doubtful loans.

SabadellUrquijo Private Banking is the division of Banco Sabadell specialized in serving the group’s private banking clients. Much work was done in 2013 to raise public awareness of SabadellUrquijo Private Banking as a leading player in serving high-income clients. Business increased by 4.7% over the year to reach a total of €23,963 million and a total of more than 28,700 private banking clients.

The division continued to focus on financial market analysis and research to identify the right asset allocation strategies as a guide to investment policy and product planning. This last activity proved to be particularly important and beneficial in 2013 now that we are seeing an upturn in expectations for economic growth on the European periphery that had been anticipated and factored into our investment recommendations.

Assets under management in Spanish-domiciled mutual funds of financial assets amounted to €6,255.5 million, up 40.8% on the previous year’s total for Spanish-domiciled funds.

In 2013 despite the continued weakness of the economy and a financial environment characterized by interest rates falling to all-time lows, the division was able to meets its targets thanks to persistent sales efforts and an increase in business activity by customers in foreign markets leading to a corresponding increase income from FX products. Banco Sabadell was the first bank to be approved as a registered member and investment advisor by MARF, Spain’s new alternative bond market, to be able to offer businesses a complete service in all areas of finance. In 2013 the Bank was the first Spanish bank to join EurexOTC Clear for interest rate swaps (IRS’s), thus anticipating the coming into force of new regulations on trading IRS’s through clearing houses.

2013 was a year of recovery in volumes and asset values and this provided a substantial boost to the group’s securities business, which saw growth in both volumes and margins compared with the previous year (see Figure F6).

Banco Sabadell’s business in the US amounts to more than USD 8,000 million with total assets of USD 6,200 million, making it Florida’s seventh largest local bank by total assets.

At the close of the year Banco Sabadell’s operating branch in Miami had more than USD 5,500 million in customer deposits and funds under management. Client portfolio management was up 45%. In 2013 the Miami branch continued to provide finance for projects in the energy and tourism sectors, mainly in the US and Mexico.

In November it acquired the assets and liabilities of Lloyds TSB Bank’s branch in Miami. The takeover accoun-ted for a large part of the growth in Banco Sabadell’s US business during the year.

During the year Sabadell United Bank made further progress in implementing its operating and sales efficiency drive, with a particular emphasis on promoting its mortgage plan to customers and developing alternative sales and customer service channels. As 2013 drew to a close, it was managing assets of some USD 3,866 million with deposits close to USD 3,200 million and loans and advances approaching USD 2,900 million. It was serving more than 45,000 customers. Sabadell United Bank reported a net profit for 2013 of USD 45 million.

In December it signed an agreement to purchase Miami-based JGB Bank whose total assets amount to some USD 500 million. It is expected that the transaction will complete and that JGB Bank will be merged with Sabadell United Bank and integrated on its systems in the course of 2014.

Sabadell Securities USA Inc., an SEC-registered investment consultancy, operates as a stockbroker and advisor to securities market investors. The business is both a complement to and a strengthening factor in the BS America strategy.

BancSabadell d’Andorra is the Andorran bank that has done best since the onset of the financial crisis in 2008, having shown sustained bottom line growth with a profit in 2013 of €6,900, a ROE of 11.5% and a healthy 10.4% growth in funding. It has also been able to maintain lending at previous levels.