The bank’s profits in Spain recovered strongly in the first half, pending the introduction of the new sector tax
Banco Santander posted attributable profit of 4,894 million euros in the first half of this year, which is 33% more year on year, after an impact of 530 million euros in restructuring costs in the same period of 2021. Second quarter, attributable profit was 2,351 million euros, 14% more year-on-year.
Between January and June, ordinary profit (excluding special operations carried out last year) amounted to 4,894 million euros, which is 16% more in current euros compared to the same period in 2021.
The results come on the same day that the groups of the governing coalition are presenting the bill to process the new tax on banks and energy companies. In the case of Spain, Santander’s activities represent 11% of the group’s total profit. Basic profit in the first half of 2022 was 652 million euros, a recovery explained by the decrease in loan loss provisions and lower costs (-4% or -11% in real terms), offsetting the impact of inflation , reflecting progress in transforming the business model. Revenues were up 1% thanks to strong commission income growth (+7%) and offset a 6% decline in net interest income, partly due to the change in the mix focused on mortgages. Santander Spain has increased the number of customers every month in 2022, which is reflected in the increase in business with private individuals (loans, deposits and insurance). The NPL ratio improved again (to 3.83%, down 133 basis points, partly due to the sale of portfolios), bringing the annualized cost of risk to 0.61% in the first half.
The bank has emphasized that the group’s diversification remains a “great lever” for growth. For example, ordinary profit for the period grew 38% in Europe to 1,839 million euros, and 7% in South America to 1,946 million, while in North America it decreased by 10% to 1,578 million due to the expected normalization of credit facilities. Digital Consumer Bank, for its part, also strongly increased its ordinary profit (+16%), to EUR 572 million.
The bank’s president, Ana Botín, indicates that “going forward, the economic context is likely to be difficult for governments, central banks, citizens and businesses.” “The banks remain part of the solution and we see, as before, the path of cooperation between all economic and social actors and the banks as the way to continue to support the economies and our customers,” he said.
“We invest in future-proofing and improving business connectivity to create customer and shareholder value. Despite the uncertainty and the difficulties in the economy, we are confident that we will achieve the 2022 targets, as we continue to increase the material book value (TNAV) and dividend per share over the medium term, following a 9% increase in the past twelve months,” he added.
Source: La Verdad
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