IBOS member Santander has reported an attributable profit up 10% year-on-year in Q1 2018 to €2,054 million.
Santander Group maintained its position among the most profitable and efficient banks in the world, with RoTE increasing by 29 basis points to 12.4%, and a cost-to-income ratio of 47.4%.
With new initiatives towards digitalisation, the number of customers using digital services has increased by 24% to 27.3 million in the year. This is a result of the launch of a number of digital initiatives driving an increase in customer satisfaction. Santander now ranks among the top three banks for customer satisfaction in seven of its core countries.
In Brazil, attributable profit increased by 7% to €677 million (+27% in constant euros) as the Bank continued to grow loyal customers and improve customer satisfaction. Loans continued to grow faster than market average. As a result, RoTE increased during the year to 19.9% from 16.5% at Q1 2017.
In Chile, attributable profit increased by 2% to €151 million (+8% in constant euros) as a focus on customer satisfaction, loyalty and digital initiatives helped drive good growth in revenues. Loan and fund growth accelerated during the quarter, while cost of credit reduced by 20 basis points from March 2017 to 1.22%.
In Mexico, attributable profit increased by 7% to €175 million (+14% in constant euros) as the Bank added a further 400,000 loyal customers since Q1 2017. Significant investment in multichannel, digitalisation and commercial initiatives helped drive strong growth in both net interest income and fee income. This, combined with strong credit quality, resulted in an increase in RoTE of 83 basis points to 19.6%.
In Portugal, attributable profit increased by 1% to €127 million with profit growth impacted by a higher tax rate and lower portfolio sales than in Q1 2017. Profit before tax increased by 10% as the ongoing digital transformation enabled an increase in customer loyalty and commercial revenues.
In Spain, attributable profit increased by 26% to €455 million as the integration of Popular continued to progress on schedule. In March 2018, the Bank launched the “1|2|3 Profesional” account, the first joint initiative for Santander and Popular customers. More than 75,000 accounts have been opened since launch. Costs increased following the incorporation of Popular, however, this was offset by positive trends in commercial revenues and an improvement in the cost of credit.
Below are Santander Group’s financial highlights for Q1 2018:
- In constant euros, (i.e. excluding the impact of currency movements) attributable profit increased 22%, driven by strong growth in Brazil, Spain and Mexico, and improved performance in the US.
- The Group maintained its position among the most profitable and efficient banks in the world, with RoTE increasing by 29 basis points to 12.4%, and a cost-to-income ratio of 47.4%.
- Santander has earned the loyalty of a further 3.3 million customers since Q1 2017, with lending and customer funds increasing by 13% and 16% respectively over the period in constant euros.
- The number of customers using digital services has increased by 24% to 27.3 million in the year.
- Increased profitability allowed the Bank to strengthen its fully loaded CET1 capital ratio by 16 basis points during the quarter to 11%.
- At the Group AGM on 23 March 2018, the Bank announced its intention to increase the dividend paid from 2018 profits by 4.5% to 23 cents per share and pay the 2019 dividend entirely in cash.
Read the full press release via Santander here.