ZCZC
BCN-26
SPAIN-BANKING-EARNINGS-SANTANDER
Santander posts profit fall due to Popular costs
MADRID, July 26, 2018 (BSS/AFP) – Spain’s banking giant Banco Santander on
Wednesday posted a 3.0 percent fall in its second quarter net profit, hurt by
restructuring costs and exchange rate effects.
The eurozone’s largest bank by market capitalisation said its profit
dropped to 1.7 billion euros in the April to June period, in line with
forecasts by analysts polled by financial information firm Factset.
Santander said it had booked restructuring costs of 300 million euros
($350 million) during the quarter related to the restructuring of Banco
Popular, the troubled Spanish lender which it took over in June 2017 for a
nominal fee of one euro after European authorities stepped in to avert the
collapse of the bank following a run on deposits.
The bank said its results were also hit by currency fluctuations in Brazil
and Britain, two of its biggest markets.
“During the second quarter we have delivered strong growth in underlying
revenue and improving credit quality, despite strong currency headwinds,”
Santander executive chairwoman Ana Botin said in a statement.
During the first half the bank posted a net profit of 3.7 billion euros, a
4.0 percent increase over the same time last year.
In Brazil, where the bank makes more than a quarter of its profits, net
profit rose by 6.0 percent during the first half, helped by the launch of new
products and services.
But in Britain, the bank’s third-biggest market, net profit fell by 14
percent as a “highly competitive environment placed pressure on revenues, and
costs increased due to higher investments in strategic, digital
transformation and regulatory projects,” the bank said in a statement.
Santander’s shares were down 0.4 percent in midday trading as the Madrid
stock exchange’s blue-chip IBEX 35 index was off a similar amount.
BSS/AFP/HR/1110