Santander: Europe’s Biggest Bank post solid profit growth
Santander said first-quarter net profit increased 19% year-over-year, offsetting a drop in loan revenue with strong results
Quick overview
- Santander reported a 19% year-over-year increase in first-quarter net profit, reaching a record 3.4 billion euros.
- The bank's strong performance was driven by its consumer lending business in the U.S. and retail operations in Spain, with Spain's retail division seeing a nearly 40% profit increase.
- Despite a 5% decline in net interest income, Santander benefited from rising interest rates and geographical diversification, mitigating the impact of Spain's new banking tax.
- Mexico's net profit decreased by 4.2% due to the depreciation of the peso and geopolitical challenges related to U.S. trade restrictions.
Live EUR/USD Chart
Santander said first-quarter net profit increased 19% YoY, offsetting a drop in loan revenue with strong results at its consumer lending business in the U.S. and retail companies in Spain.
The largest lender in the euro zone by market value reported a record quarterly net profit of 3.4 billion euros ($3.87 billion) for the fourth consecutive quarter, exceeding the 3.16 billion euros predicted in a Reuters survey.
Santander has profited from rising interest rates, but it has an advantage over more Europe-reliant competitors that have reduced their presence in the Americas due to growth in its major Latin American markets. Spain’s retail division had a nearly 40% increase in net profit during the quarter, contributing to a 49% year-over-year increase.
Its Digital Consumer lending division nearly doubled net profits in the U.S., resulting in a 49% increase in net profit.
Additionally, Santander’s geographical diversification and a lessened impact from Spain’s renewed banking tax helped it boost sales by 1% during the quarter.
In the same quarter, the lender recorded a charge of almost 87 million euros against the new banking levy, which is about one-fourth of the expected 350 million euros that will be collected annually.
The Spanish banking giant modified the impact on a linear quarterly basis based on the tax laws now in effect, unlike prior years when the full 335 million euros was booked in the first quarter.
The bank’s net interest income, which is determined by subtracting deposit charges from loan revenues, fell 5% year over year to 11.38 billion euros during the quarter due to Argentina’s hyperinflation accounting. Analysts had projected 11.42 billion euros, but this was a little less.
Mexico’s quarterly net profit fell 4.2%, primarily due to the depreciation of the Mexican peso against the backdrop of geopolitical challenges emanating from U.S. trade restrictions
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Related Articles
Comments
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals