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SAN Banco Santander SA

4.87
0.07 (1.46%)
03 May 2024 - Closed
Delayed by 15 minutes
Name Symbol Market Type
Banco Santander SA NYSE:SAN NYSE Depository Receipt
  Price Change % Change Price High Price Low Price Open Price Traded Last Trade
  0.07 1.46% 4.87 4.89 4.82 4.85 3,063,652 01:00:00

Santander Improves Provisions Outlook as 3Q Beat Expectations -- Earnings Review

27/10/2020 8:39am

Dow Jones News


Banco Santander (NYSE:SAN)
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From May 2019 to May 2024

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By Pietro Lombardi

 

Banco Santander SA reported third-quarter results on Tuesday. Here is what you need to know.

 

NET PROFIT: The Spanish banking giant posted a quarterly profit of 1.75 billion euros ($2.07 billion), roughly tripling from a year earlier, when results were hit by charges related to its U.K. business. On an underlying basis, profit fell 18%. Analysts had expected a profit of EUR971.5 million, according to a consensus provided by FactSet.

 

REVENUE: The top line fell 11% on year on underlying basis, less than analysts expected. Revenue of EUR11.09 billion compared with expectations of EUR10.59 billion.

 

WHAT WE WATCHED:

 

OUTLOOK: Santander improved its guidance for bad-loan provisions for this year. It now expects cost of credit of around 1.3%, from a previous guidance of 1.4%-1.5%. Cost of risk is expected to "remain stable or trend downward in 2021, before normalizing in 2022," it said. The bank expects to achieve an underlying profit of EUR5 billion this year, while the core Tier 1 ratio is expected to remain at the top end of its 11%-12% target range. Santander expects 2021 underlying return on tangible equity in line with the bank's cost of equity.

 

ADDITIONAL COST CUTS IN EUROPE: The bank said its cost-savings plans are going better than expected. By the end of the year, it will achieve its goal to save EUR1 billion in Europe, and promised to cut EUR1 billion more in costs in the region in coming years.

 

PROVISIONS: The lender set aside provisions of EUR2.54 billion in the quarter for potential loan losses. This takes the amount it has set aside so far this year to EUR9.56 billion. Analysts had forecast quarterly provisions of EUR3.14 billion.

 

CAPITAL: Santander's core Tier 1 ratio rose to 11.98% at the end of September from 11.84% in June.

 

Write to Pietro Lombardi at pietro.lombardi@dowjones.com; @pietrolombard10

 

(END) Dow Jones Newswires

October 27, 2020 04:24 ET (08:24 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.

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