Santander’s business in Spain has become the main catalyst for the group’s earnings in the first half thanks to the environment of rising interest rates and the improvement in efficiency, and despite the new tax on banks and energy companies for the windfall profits from the invasion of Ukraine.
Santander earned 5,241 million euros in the first half, 7% more than in the same period of the previous year, after raising the result in Spain by 74%, up to 1,132 million, and 16% in the United Kingdom, up to 818 million . This progression contrasts with the decline of 19% in North America and 23% in South America.
The strategy is focused on simplifying the product offering and on the search for synergies related to the bank’s global implementation. The president of Santander, Ana Botín, highlights the rate of customer acquisition, with nine million more in the first half, and credit quality, which “remains solid.” The group already has 164 million customers.
Botín also emphasizes the improvement in profitability, which is already at 14.5% and which is accompanied by earnings per share 13% higher than in the same period of 2022. In six months, the improvement in value and the distribution of dividends total 6,000 million euros.
Revenues grew by 13%, to 28,234 million euros, thanks above all to the increase in interest margins, that is, the difference between income from loans and expenses from remuneration of deposits. The improvement occurred without signs of concern in variables such as delinquency, which dropped to 3.05%, and quality capital, which is equivalent to 12.2%, above the ECB’s requirements.
Commissions, which together with the interest margin complete the income item, increased by 5% thanks mainly to the bank’s businesses with the highest added value, which are those with a global presence, including the investment banking area CIB, the wealth management company Wealth Management
The bank accumulates 1.13 trillion euros in customer funds, including deposits, the volume of which has increased by 4%. As indicated, clients have continued to use deposits to repay debt in the quarter, especially mortgages.
There was also during the semester an effort to increase endowments. The increase was 21% due to aspects such as provisions in Brazil or the need to increase the mortgage portfolio in Poland.
