Europe’s
second-largest bank by market capitalisation, Santander, has posted
net profits for fiscal 2009 of €8.94 billion ($13.3 billion), up 1
percent from the previous year, boosted by strong earnings growth
at its UK and Brazilian retail units.
The bank had set a target for 2009 of matching
the €8.89 billion earned in 2008.
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Latin America contributed 36 percent of group
profits, Spain accounted for 26 percent, continental Europe 22
percent and the UK 16 percent.
Santander chairman Emilio Botin said: “The
results for 2009 are the best in the bank’s history, if one takes
into account the difficult circumstances.”
Despite the difficult conditions, especially
in its domestic Spanish market, global retail sector earnings rose
0.7 percent year-on-year to €7.4 billion.
Other 2009 highlights included:
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By GlobalData• UK profits before tax rose by over
30 percent. Around 1.1 million net new accounts were opened in the
UK in 2009, beating its target of 1 million. Santander now has a 10
percent market share in all core UK retail sectors of current
accounts, mortgages and savings;
• A cut in Santander’s cost-income
ratio by 290 basis points to 41.7 percent at the end of 2009 (44.6
percent at the end of 2008);
• An increase of 110 basis points in
the bank’s core capital ratio to 8.6 percent at the end of 2009
compared to the end of the previous year;
• Recent acquisitions – Banco Real
(Brazil), Alliance & Leicester and Bradford & Bingley (both
UK), US-based Sovereign and various consumer finance units –
contributed combined net earnings of €1.55 in 2008.
• Santander forecasts the divisions
will contribute a combined €2.3 billion and €3.0 billion in 2010
and 2011 respectively, and;
• Non-performing loans as a
percentage of total loans rose at the slowest pace for five
quarters to reach 3.24 percent at the end of the fourth quarter,
compared with 2.02 percent at the end of 2008 and well below the
Spanish bank sector average of 5 percent.
Net interest income rose 26 percent to €26.3
billion for the year, but the return on equity fell to 13.9 percent
from 17.07 per cent in 2008.
Botin even had good news to report at
Sovereign Bancorp.
The struggling US-based lender acquired by
Santander broke even in the fourth quarter for the first time since
Santander acquired full ownership.
Botin added: “Sovereign brought in no profit
in 2009 but will in 2010.”
|
Performance |
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|
Santander – fundamentals, |
|||
|
2009 |
2008 |
% change |
|
|
NII (€bn) |
26.3 |
20.9 |
25.6 |
|
Gross income (€bn) |
39.4 |
33.5 |
17.6 |
|
Total assets (€trn) |
1.1 |
1.05 |
5.8 |
|
Net customer loans (€bn) |
682.5 |
626.9 |
8.9 |
|
Attributable profit (€bn) |
8.94 |
8.87 |
0.7 |
|
Core capital (%) |
8.6 |
7.5 |
110bp |
|
NPL ratio (%) |
3.24 |
2.04 |
120bp |
|
Cost-income ratio (%) |
41.7 |
44.6 |
-290bp |
|
Branches |
|||
|
2009 |
2008 |
% change y-o-y |
|
|
Total branches |
13,660 |
14,112 |
-3.2 |
|
Spain |
4,865 |
5,022 |
-3.1 |
|
Continental Europe |
1,006 |
976 |
0.3 |
|
UK |
1,322 |
1,303 |
0.1 |
|
Latin America |
5,745 |
6,089 |
-5.6 |
|
Sovereign US |
722 |
722 |
0 |
|
Source: Santander |
|||
