Santander Profits Plunge After €18.8bn Spanish Property Writedown
By Martin Baccardax | January 31, 2013 7:04 PM EST
Banco Santander said its full year profits fell by more than half after Spain's biggest lender marked down the value of billions in property loans and saw slowing business in its key Latin American markets.
Profit fell 59 percent to €2.205bn (£1.89bn; $2.99bn), the bank said in a statement published on its website. The Eurozone's biggest property lender said it set aside €18.8bn to cover losses on soured real estate loans.
The ratio of bad debts in its portfolio was 4.54 percent as of 31 December, slightly lower than the national average for Spanish lenders of 6.74 percent. Group revenues for the full year were €43.657bn
"Profits reached a turning point in 2012," said Santander Chairman Emilo Botin in the statement. "In 2013, with the exceptional write-offs behind us, we should see a marked increase in earnings, based on the group's recurrent revenues and cost control."
The bank's exposure to Spanish real estate was reduced to €12.5bn, the statement said, from around €24.9bn in 2011, after shifting more than 33,500 properties over the course of the year.
Its so-called core tier one capital ratio, a measure of the amount of capital the bank needs to set aside to protect savers and shareholders from potential losses, improved by 0.3 percent to 10.33 percent.
Profits from its operations in Latin America, which contribute around half of the bank's bottom line, fell by 8 percent to €4.305bn for the full year, Santander said. European profits were down 2 percent to €2.32bn while UK profits fell 4 percent to €1.175bn.
Santander shares fell nearly 3 percent in Madrid and were quoted at €6.215 each, a €0.185 decline from Wednesday's close.
To report problems or to leave feedback about this article, e-mail:
To contact the editor, e-mail:
Most Popular Slideshows
- NFL Recap - Week 4: Green Bay Packers 38, Chicago Bears 17 [PHOTOS]
- Derek Jeter With The New York Yankees Through The Years [IN PICTURES]
- Photos Of George Clooney And Amal Alamuddin, They Get Married Again On Monday [Slideshow]
- Taylor Swift's Famous Ex-Boyfriends: From Harry Styles To Joe Jonas [PHOTOS]
Join the Conversation
- 3 Signs Nexus 6, 8 Release Date Nears: Leaked Pics, KitKat Factory Image & Android L Details Emerge
- Samsung Galaxy Note 4 Available Through O2 For £380, Other Carriers To Follow Soon
- Apple iPhone 6 vs. OnePlus One: With Invitation-Only Model Rested, OnePlus One Can Be A Real Threat To iPhone 6
- ISIS Supporters are Walking Among the Many in the United States – Report
- ISIS Receives Food, Ammunition Due To Mistake Of Iraqi Pilots
- New Windows OS Is Not Windows 9, Microsoft To Launch Windows 10 As New OS Build
- Airstrikes Against ISIS Has Claimed Innocent Lives In Syria, Dubbed ‘Ineffective’ By Jihadi Fighters, US Military To Ask For More Spending Money