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Santander gains 2.054 billion to march, 10% more, by the thrust of Spain and Brazil

The smaller provisions with the Brazilian and Spanish business, by the incorporation of the Popular, raise the result

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Santander gains 2.054 billion to march, 10% more, by the thrust of Spain and Brazil

Banco Santander obtained a net attributable profit of 2.054 billion euros in first quarter of year, which is 10% more than same period of previous year. The group has benefited from pull of several markets in which it operates as Brazil and Spain (with incorporation of Popular) as well as good behavior of consumer credit business. In constant euros, i.e. excluding impact of exchange rates, growth of attributed profit would have been 22%.

The profit in Spain, 455 million, has risen 26%, second best behavior after that of United States (125 million), which rises by 32% in first three months of 2018. Brazil is still country where most money wins Santander, with 677 million obtained until March ( 7%). The subsidiary of Argentina had worst behavior of ten units of group, (66 million), with a fall of result of 39%, while British declined by 23%, affected by exchange rate of pound against euro, and achieved 320 million.

In percent, by geographies, Brazil's profit represents 27% of group, followed by Spain with 18%, United Kingdom with 13%, consumer credit division, also 13%, Mexico 7%, Chile 6% and United States and Portugal, 5%. As for business structure, entity headed by Ana Botin dedicates 36% of loans to mortgages of households, 16% to loans to consumption, 11% to SMEs and 17% to or companies.

More information
  • Banco Popular's 300,000 shareholders lose 100% of ir investment
  • Why does Santander only pay a euro for Popular?
  • Banco Popular suffered losses of 13.56 billion euros in 2017
NET margin Fall

The income statement reflects a 1% increase in financial incomes compared to 4% of costs, following integration of Popular and investments in digitization, which has caused net margin to fall by 1.5% compared to first quarter of 2017. In previous quarters, Santander presented all its positive margins. However, slightest need for provisions for insolvency due to best behavior of delinquency, straighten income statement to raise a 10% net profit. The profit per share in euros falls by 0.5% for increase of capital made for acquisition of Popular. The group maintains its goal of increasing its benefit by double-digit action in 2018.

As for profitability, ROE (which measures profitability on own resources) rose from 8.19% to 8.67%. The solvency has improved as ratio CET 1 fully loaded is passed, indicator that reflects quality of capital with requirements that will enter into force in 2019, from 10.66% to 11%. As for credits, Santander closed quarter with 856,628,000,000 loans, 7.7% more, and has deposits of customers in amount of 767,340,000,000, 8.7% more.

Santander is largest bank in eurozone, with a stock market capitalization of 85.441 million at March 31, 2018, 3.4% less than last December. At end of first quarter, it had four million shareholders and 201,900 employees (7.3% more) serving 139 million customers, according to entity's data.

Santander has 27.3 million digital customers, 24% more, representing 19.4% over total. This means an increase of 5.2 million people who access or work through Internet. As for efficiency, which measures what entity spends for every hundred euros it enters, has worsened from 46.1% to 47.4% due to increased costs.

The linked customers, who are those who consider Santander its main bank, increased by 3.3 million, until 18.8 million, since first quarter of 2017, while default rate of group fell to 4.02%, with a decline of 135 basic points Since integration of Banco Popular in June 2017.

The Popular disappears before turning 92 years

Santander has sent this Tuesday 24 April a relevant fact to CNMV in which "communicates that its board of directors and Spanish Banco Popular have agreed merger by absorption of latter by Banco Santander. Banco Popular is directly involved at 100% by Banco Santander. The same has happened with Banco Pastor, which was already a subsidiary of Popular.

In practice, this step implies legal disappearance of Popular, which on July 14 would have fulfilled 92 years of history. From now on, Popular-which became one of most profitable banks in world-will only remain labels in offices until Santander decides to remove m, something that has announced, but without setting date.

The integration of bank that was chaired by Emilio Coracho until 6th of June is progressing in a good way. Santander has been incorporating different divisions within group, so that today no longer remains its structure as a Popular bank: its central services are within matrix, as well as wholesale banking, offices, subsidiaries of Portugal (and soon United States), etc. The merger of technological platforms of Santander and Popular is key that allows unification of offices under a brand, able to serve clients of both banks.

After this announcement, workers ' commissions issued a statement stating that now that Santander, Popular and Pastor "were a single company, need for an employment protocol that guarantees conditions of more than 30,000 people in a very short time They're going to form resulting company. "

The union, which maintains talks with entity, affirms that " Cicatería of Santander in approval of conditions would not be understood" and calls for "to guarantee conditions of work, levels of employment and to renounce traumatic measures in future Resulting company ".

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