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Santander’s Q1 net profit jumps five-fold boosted by U.S. and UK unit

imageStock Markets37 minutes ago (Apr 28, 2021 03:16AM ET)

(C) Reuters. FILE PHOTO: A logo of Santander, the euro zone’s largest lender by market value, is seen on a branch in the Andalusian capital of Seville

By Jesus Aguado

MADRID (Reuters) -Spain’s Santander (MC:SAN) on Wednesday posted a first-quarter net profit up almost five-fold helped by lower impairments, record U.S. earnings and strong growth in the UK.

The euro zone’s second-biggest lender by market value booked a net profit of 1.608 billion euros ($1.94 billion) versus 331 million a year earlier.

That beat the 1.38 billion expected by analysts polled by Reuters, though was still short of the 1.84 billion recorded in the same quarter in 2019, before the pandemic.

It booked no COVID-19 provisions, unlike a year earlier, when it set aside around 1.6 billion euros to protect its books against the potential impact from the pandemic.

A strong performance at its Corporate and Investment Bank (CIB) unit, with a 64% rise in underlying profit, also helped.

Excluding net restructuring charges of 530 million euros, mainly in the UK and Portugal, the bank increased its underlying profit by around 50% buoyed by faster growing emerging economies such as Brazil, its main market.

Santander’s diversification overseas, especially in Latin America, has helped the bank to cope with tough conditions for banks in Europe since the financial crisis.

Its U.S. underlying profit jumped to 616 million euros from 60 million, making it the highest contributor among all markets.

Santander announced that in the UK, where net profit rose to 294 million euros from 52 million, it would replace its current CEO Nathan Bostock, adding that he would remain in his position until a successor was appointed.

In Spain, where its net profit climbed to 243 million euros from 90 million euros in the same quarter last year, the bank said that Antonio Simoes, the bank’s regional chief for Europe, would be country head for Spain, replacing Rami Aboukhair.

The bank finished March with a fully loaded capital ratio (CET-1), the strictest measure of solvency, of 11.89% under new accounting standards, unchanged from the previous quarter, and within its 11-12% target.

($1 = 0.8282 euros)

Santander’s Q1 net profit jumps five-fold boosted by U.S. and UK unit

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