Santander 2Q Profit Falls 3% on Banco Popular Integration Costs

By Adam Clark

Banco Santander S.A. (SAN) said Wednesday its second-quarter profit fell, dragged by the integration costs of its 2017 acquisition of rival Spanish lender Banco Popular.

The Spanish bank, one of Europe's largest lenders, said its second-quarter net profit came to 1.70 billion euros ($1.99 billion), down 3% from the year-earlier quarter.

Santander said the fall was due to EUR300 million in Banco Popular integration costs. On an underlying basis, profit rose 14% to EUR2.00 billion, Santander said.

Net-interest income--the difference between what the lender earns from loans and pays out on deposits--came to EUR8.48 billion, as gross income remained flat at EUR12.01 billion.

Santander's Common Equity Tier 1 ratio, a key measure of balance-sheet strength, stood at 10.80% at the end of the quarter. The bank said it remains on-track to meet its capital target and grow earnings per share by double digits in 2018.

"During the second quarter we have delivered strong growth in underlying revenue and improving credit quality, despite strong currency headwinds," Executive Chairman Ana Botin said.

"During the quarter we have seen particularly strong growth in Brazil, Spain, Mexico and the US and this has more than offset a more challenging environment in other markets," she said.

Write to Adam Clark at [e-mail]; @AdamDowJones

(END) Dow Jones Newswires

July 25, 2018 01:34 ET (05:34 GMT)

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