|
The
lender reiterated its target of more than 13% for underlying
return on tangible equity (ROTE) up from 12.73% in 2021 despite
soaring energy prices felt predominantly in Europe due to
Russia's invasion of Ukraine.
Santander for 2022 also maintained its target of around 12% core
tier-1 fully loaded capital ratio, kept its dividend pay-out
target at 40% and its cost-income ratio, a measure of
efficiency, at 45% versus 46.2% at end-December.
Santander's diversification, especially in Latin America, has
helped the bank cope with tough conditions for lenders in Europe
since the financial crisis.
Its underlying profit in North America more than doubled in to a
record 3.05 billion euros boosted by a more than a threefold
increase in the United States, while in South America it rose by
24% to 3.33 billion euros.
The two regions accounted for around 60% of the group's
underlying profit in 2021, while Europe represented 28%.
"In the first quarter of 2022, the commercial activity has
remained strong with revenues in line with the last quarter and
new lending returning to prepandemic levels, increasing by an
estimated 8% year on year," Santander Chairman Ana Botin said in
a statement ahead of the bank's general shareholders meeting.
Shares in Santander were up 2% to 3.16 euros at 0717 GMT,
outpacing Spain's leading blue-chip index Ibex-35 which was up
0.4%.
Santander helped by lower loan loss provisions booked a net
profit of 2.28 billion in the October to December quarter, up
4.6% from the third quarter.
It reported a net profit of 8.12 billion euros in 2021 after
losing 8.77 billion euros in 2020.
Santander does not have a presence in Russia or Ukraine,
limiting its direct exposure to 80 million euros, though the
conflict could have an indirect impact, especially through high
energy prices for some of its customers.
Santander said that Botin would reassure shareholders that in
the medium term, the bank aimed to achieve an underlying return
on tangible equity and cost-to-income ratio of around 15% and
40%, respectively, and maintain a capital ratio of 12%.
The bank's shareholders on Friday are expected to approve a
final cash dividend of 5.15 euro cents per share, on top of an
already paid 4.85 euro cents per share.
With a shares buyback of 841 million euros and an additional
buyback of 865 million euros being implemented, the capital
distributed against 2021 results would be 3.4 billion euros.
Shareholders will also be asked to approve a reduction of the
group's outstanding share capital of up to 10% by cancelling
shares it may acquire, including under potential repurchase
programmes in the future.
(Reporting by Jesús Aguado; editing by Inti Landauro and Jason
Neely)
[© 2022 Thomson Reuters. All rights
reserved.]
This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
