Santander Group

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Banco Santander, S.A.
Type Sociedad Anónima
Traded as BMADSAN, LSEBNC, NYSESAN, EuronextSANT, SANTA, BITSANT
Industry Financial services
Founded Santander, Spain (1857)
Headquarters Santander, Spain
Area served Europe, United States, Latin America, Singapore, Hong Kong, Africa.
Key people
Products Retail, corporate, investment and private banking, insurance, asset management, private equity
Revenue 43 billion (2012)[1]
Operating income €23.56 billion (2012)[1]
Profit €2.205 billion (2012)[1]
Total assets €1.269 trillion (2012)[1]
Total equity €80.91 billion (2011)[2]
Employees 186,763 (2012)[1]
Website www.santander.com

The Santander Group /ˌsɑːntɑːnˈdɛər/ is a Spanish banking group centered on Banco Santander, S.A. (Spanish: [ˈbaŋko santanˈder]) and is the largest bank in the Eurozone by market value.[3] It is one of the largest banks in the world in terms of market capitalization. As its name suggests, the company originated in Santander, Cantabria, Spain.[4]

The group has expanded in recent years through a number of acquisitions, with operations across Europe, Latin America, North America and Asia. Many subsidiaries, such as Abbey National, have been rebranded under the Santander name.

In April 2013, Santander was ranked as 43rd in the Forbes Global 2000 list of the world's largest companies.[5]

History[edit]

Formation[edit]

Banco Santander merged with Banco Central Hispano in 1999, which had in turn been formed through the merger in 1991 of Banco Central and Banco Hispanoamericano. The merger that created the combined bank, known as Banco Santander Central Hispano, or BSCH,[6] was designed to be a "merger of equals" in which the top executives of the two pre-existing firms would share control of the merged entity. Soon after the merger former BCH executives accused chairman of Banco Santander Emilio Botín of trying to push his own agenda and threatened to take legal action against him. This post-merger disagreement was resolved when BCH executives Jose Amusátegui and Angel Corcóstegui agreed to accept severance payments, retire and pass control to Mr. Botín, at an expense to shareholders of 164M.[7]

The large termination payouts generated negative press and Botín was eventually brought to trial on criminal charges of "misappropriation of funds" and "irresponsible management." However, he was cleared of all charges in April 2005. The verdict said the €164M retirement payments made to the two former executives were legal, "made as compensation for the services provided to the bank." That year the anti-corruption division of the Spanish public prosecutor's office also cleared Mr. Botín of all charges in a separate case in which he was accused of insider trading.[6]

Acquisitions[edit]

On 26 July 2004 Banco Santander Central Hispano announced the acquisition of Abbey National plc. Following shareholders' approval at the EGM of Abbey (95 per cent voted in favour, despite vocal opposition from most of those present) and Santander, the acquisition was formally approved by the courts and Abbey became part of the Santander Group on 12 November 2004.[8]

In June 2006, Banco Santander Central Hispano purchased almost 20% of Sovereign Bank and acquired the option to buy the bank (at the time, the market value would be roughly US$40 per share) for one year beginning in the middle of 2008.[9]

In May 2007 Banco Santander Central Hispano announced that in conjunction with The Royal Bank of Scotland and Fortis it would make an offer for ABN AMRO. BSCH's share of the offer added up to 28% and the offer would have to be made up of a capital increase through a new share issue. Then in October 2007 the consortium outbid Barclays and acquired ABN AMRO. As part of the deal, Grupo Santander acquired ABN AMRO's subsidiary in Brazil, Banco Real, and its subsidiary in Italy, Banca Antonveneta.[10]

On 13 August 2007, Banco Santander Central Hispano changed its legal name to Banco Santander. In November that year, it sold Banca Antonveneta to Monte dei Paschi di Siena. In March 2008, Banco Santander sold Interbanca, a subsidiary of Banca Antonveneta, to GE Commercial Finance, receiving in return GE Money businesses in Germany, Finland and Austria, and GE's card and auto-financing businesses in the UK, which it integrated with Santander Consumer Finance.[11]

The group announced in July 2008 its intention to purchase the UK bank Alliance & Leicester, which held £24bn in deposits and had 254 branches.[12] Santander also purchased the savings business of Bradford & Bingley in September that year, which held deposits of £22bn, 2.6m customers, 197 branches and 140 agencies.[13] The acquisition of Alliance & Leicester completed a month later when the bank's shares were delisted from the London Stock Exchange. The two banks were merged with Abbey National under the Santander UK brand by the end of 2010.[14]

In October 2008, the Santander Group announced it would exercise its option to acquire the 75.65% of Sovereign Bancorp it did not currently own for approximately US$1.9 billion (€1.4 billion). Because of the banking and market crisis affecting much of the American banking industry at the time, Sovereign's price-per-share had fallen greatly: Rather than the $40 per share it would have cost in 2006, Banco Santander ended up paying less than $3 per share. The acquisition of Sovereign gave Santander its first retail bank in the mainland United States.[15] Santander renamed the bank to enhance its global brand recognition in October 2013.[16]

On 14 December 2008, it was revealed that the collapse of Bernard Madoff's Ponzi scheme might mean the loss of €2.33 billion at Banco Santander.[17]

On 10 November 2009, HSBC Finance Corporation announced its auto finance entities had reached an agreement with Santander Consumer USA Inc. (SC USA) to sell HSBC US auto loan servicing operations as well as US$1 billion in auto loan receivables for US$904 million in cash, and enter into a loan servicing agreement for the remainder of its US auto loan portfolio, which is in liquidation. The transaction is expected to close in the first quarter of 2010.

In September 2010, Santander purchased Bank Zachodni WBK from Allied Irish Banks. Then on 28 February 2012, Santander announced that it had reached an agreement with KBC Bank to buy KBC's subsidiary in Poland, Kredyt Bank. Santander merged Bank Zachodni WBK and Kredyt to create Poland's third-biggest bank, valued at about €5bn (US$6.7bn), having a market share of 9.6% in deposits, 8.0% in loans and 12.9% in branches (899), and more than 3.5 million retail customers. As a result of the merger, Santander came to hold 76.5% of the combined bank, and KBC came to hold about 16.4%; other shareholders held about 7.1% of the shares in the combined bank. Santander stated that it intended to buy more of KBC's shares in the combined bank to bring KBC's holdings below 10%; KBC affirmed that it intended to sell its remaining stake.[18] KBC has now sold its shareholding and Santander now own 75% of the bank, the rest is free float.

In October 2013, Santander agreed to acquire a 51% in the Spain’s largest consumer finance business, El Corte Inglés, for around €140 million.[19]

Operations[edit]

A branch of Santander in Berlin, Germany

The Santander Group has numerous operations across Europe, Latin America, North America and Asia. This has been in part due to a number of acquisitions over the years, many of which have been rebranded under the Santander name.

The Group consists of more than 186,000 employees, 102 million customers, 14,392 branches and 3.26 million shareholders. Retail banking – the main aspect of Santander's operations – generates 74% of the group's profit.[20]

A branch of Santander in Cardiff, United Kingdom
Santander bank in Rio de Janeiro, Brazil
Santander Totta branch in Lourinhã, Portugal

Europe

  • Austria
    • Santander Consumer Bank Austria AG
  • Belgium
    • Santander Consumer Finance Benelux B.V.
  • Denmark
    • Santander Consumer Bank AS
  • Finland
    • Santander Consumer Finance Oy
  • France
    • Banco Santander, S.A. – Representative Office in Paris
  • Germany
    • Santander Consumer Bank AG
    • Santander Bank (Zweigniederlassung der Santander Consumer Bank AG)
    • Santander Consumer Debit GmbH
    • Santander Consumer Leasing GmbH
  • Isle of Man
    • Santander UK Isle of Man branch
  • Italy
    • Santander Consumer Bank S.p.a
    • Santander Private Banking
  • Jersey (UK)
    • Santander Private Banking
  • Netherlands
    • Santander Consumer Finance Benelux B.V.
  • Norway
    • Santander Consumer Bank AS
  • Sweden
    • Santander Consumer Bank AS
  • Switzerland
    • Santander Private Banking

Latin America

  • Colombia
    • Banco Santander de Negocios Colombia S.A.
  • Mexico
    • Banco Santander
  • Peru
    • Banco Santander Perú S.A.
  • Puerto Rico
    • Banco Santander Puerto Rico
    • Santander Overseas Bank
  • Uruguay
    • Banco Santander Uruguay

Asian and Australia

  • China
    • Banco Santander, S.A. – Hong Kong branch
    • Banco Santander, S.A. – Shanghai branch
    • Banco Santander, S.A. – Beijing representative office
  • South Korea
    • Banco Santander, S.A. – Seoul representative office
  • Australia
    • Banco Santander, S.A. – Sydney branch
  • Japan
    • Banco Santander, S.A. – Tokyo representative office
  • Singapore
    • Banco Santander, S.A. – Singapore branch

African operations

North America

  • USA
    • Santander Private Banking
    • Santander Bank
    • Santander Consumer USA Inc.
    • Santander Global Banking & Markets
    • Roadloans
    • HelpingLoans

On 10 June 2010, Grupo Santander announced an investment of approximately US$270 million (€200 million) in Campinas, Brazil for a technology centre, research and data processing, which will include a next-generation data centre. The centre will support the group's operations across North America, Central America and South America.

Based on a plot of 1 million square metres, the new centre will be established within the technology park known as 'Development Company for High Technology Cluster of Campinas', which includes more than 20 other companies. Construction on the site began in January 2011, and it is planned that the park will be fully operational within two years. There will be over 8,000 direct and indirect jobs. [21]

Sponsorships[edit]

Santander is a corporate sponsor of the Ferrari and McLaren Formula One teams, and also sponsors the Copa Libertadores de America, Copa Sudamericana, and the Recopa Sudamericana.[22]

The group had announced on 1 December 2008 that their Formula One sponsorship deal with McLaren would end in 2010, when Santander would become Ferrari's main sponsor. However, in September 2009, Santander announced it would continue to sponsor McLaren alongside Ferrari due to its brand awareness in the UK rising from 20 to 82 percent.[23]

See also[edit]

References[edit]

Notes[edit]

  1. ^ a b c d e "Annual Report 2012" (PDF). Santander Group. Retrieved 1 March 2013. 
  2. ^ "Annual Results 2010" (PDF). Santander Group. Retrieved 3 February 2011. 
  3. ^ "The Eurozone's Biggest Bank Posts A Stunning $26 Billion Write-Down". Business Insider. 31 January 2013. Retrieved 1 March 2013. 
  4. ^ "Global 2000 Leading Companies 2011". Forbes. Retrieved 2013-07-14. 
  5. ^ Scott DeCarlo (17 April 2013). "The World's Biggest Public Companies". Forbes. Retrieved 10 May 2013. 
  6. ^ a b Guillén & Tschoegl (2008)
  7. ^ Guillén & Tschoegl (2008).
  8. ^ HBOS fury as EU backs Santander's Abbey bid The Independent
  9. ^ Spanish bank buys Sovereign stake
  10. ^ Santander buys ABN Global clients in Brazil
  11. ^ GE, Santander finalize GE Money, Interbanca deal
  12. ^ Santander agrees £1.2bn A&L deal
  13. ^ Santander buys B&B branch network and deposit book
  14. ^ "Santander scraps UK bank brands". BBC News. 27 May 2009. Retrieved 23 May 2009. 
  15. ^ Santander to acquire Sovereign
  16. ^ Noreen O'Leary (16 August 2012). "Sovereign\Santander Picks New Agency". Adweek. Retrieved 3 September 2012. 
  17. ^ "Santander Clients Have $3.1 Billion With Madoff (Update1)". Bloomberg. 14 December 2008. 
  18. ^ Santander to Buy KBC’s Kredyt Bank to Boost Polish Business
  19. ^ Carlos Ruano (8 October 2013). "Spain's Santander to buy 51 percent of El Corte Ingles finance arm". Reuters. 
  20. ^ "Key data". Santander Group. 2013. Retrieved 1 March 2013. 
  21. ^ "Santander investirá R$ 450 milhões em pólo de tecnologia, pesquisa e processamento em Campinas" (in Portuguese). Santander. 2010-06-10. Retrieved 2013-07-14. 
  22. ^ "Corporation Sponsorship". Santander Group. 2013. Retrieved 26 September 2013. 
  23. ^ "Santander extends McLaren partnership". Formula 1. 2009-09-14. Retrieved 2013-07-14. 

Sources[edit]

  • Guillén, Mauro and Adrian Tschoegl (2008) Building a Global Bank: The Transformation of Banco Santander. (Princeton, NJ: Princeton University Press).

External links[edit]