Santander Bank Posts Record Profit As Rates Rise
Fahad Shabbir (@FahadShabbir) Published February 02, 2023 | 08:14 PM
Spanish banking giant Banco Santander reported on Thursday record profits for 2022, becoming the latest European lender to get a boost from higher interest rates
Madrid, (UrduPoint / Pakistan Point News - 2nd Feb, 2023 ):Spanish banking giant Banco Santander reported on Thursday record profits for 2022, becoming the latest European lender to get a boost from higher interest rates.
The bank posted an annual net profit of 9.6 billion euros ($10.6 billion), up 18 percent from 2021 and higher than forecast by analysts polled by financial data firm FactSet.
The result smashed the previous record annual profit of 9.06 billion euros seen in 2007, before the global financial crisis of 2008.
"2022 was another strong year for Santander as we made further progress in growing our customer base profitably, while maintaining a rock-solid balance sheet," Banco Santander head Ana Botin said.
Central banks have hiked interest rates worldwide in an effort to tame runaway inflation, which jumped after economies emerged from Covid restrictions, and surged higher still after Russia invaded Ukraine last year.
Banks across Europe have benefited from higher borrowing costs.
BBVA, Spain's second-biggest lender by market value after Santander, posted Wednesday a 38 percent jump in net profit to a record 6.42 billion euros in 2022.
And on Thursday Germany's largest lender, Deutsche Bank said it booked its highest annual profit since 2007 last year, thanks to higher interest rates.
Botin said central banks and governments are expected to continue to focus on bringing down inflation this year.
"Our team has proven experience in navigating these conditions successfully and we expect revenue growth will continue to offset cost inflation pressures and the anticipated increase in cost of risk," she said.
The bank, which has a strong presence in Europe and Latin America, added seven million new clients last year, bringing its worldwide total to 160 million.
This helped total loans to increase by 5.0 percent and deposits to rise 9.0 percent.
- More growth in 2023 - Santander's net interest income, the equivalent of its revenue, rose 16 percent to reach 38.6 billion euros, slightly higher than forecast by FactSet.
Santander said it expects to post double-digit revenue growth in 2023.
While the sharp rise in inflation led to a seven percent rise in overall costs, the bank said it had continued to improve productivity last year, aided by growing number of customers doing their banking online.
Santander said its cost-to-income ratio -- an efficiency indicator which is the ratio of total costs to total income of the bank -- was 45.8 percent in 2022, inching up from 45.4 percent in the previous year.
It said this is one of the best levels of Europe's major banks.
The bank confirmed that shareholders would receive a payout of around 40 percent of the group's underlying profit, divided equally between cash dividends and share buybacks.
Spain's left-wing government plans to impose a temporary windfall tax on big banks in 2023 and 2024 to finance measures aimed at helping households cope with higher prices.
The measure is expected to add 1.5 billion euros to the state budget this year and a similar amount in 2024.
Related Topics
Recent Stories
DP World ILT20 Season 3 to begin from 11 January 2025
Sharjah Public Library unveils interactive arts and crafts journey at SCRF 2024
"Wonder Walks” show makes an enthralling debut at SCRF 2024
Remarkable Young Minds Light up the Stage at Sharjah Children’s Reading
Currency Rate In Pakistan - Dollar, Euro, Pound, Riyal Rates On 12 May 2024
Today Gold Rate in Pakistan 12 May 2024
Crown Prince Mohammad bin Salman's visit schedule being discussed
Govt decides to procurement wheat from farmers
Deputy PM to pay 4-day visit to China from Monday
Pakistan seeks foreign investments in diverse sectors: PM
Digital transformation key priority for govt to improve tax collection: Aurangze ..
President-designate of COP29 for collective efforts to deal with climate change ..
More Stories From Business
-
Commissioner directs early completion of public welfare projects
15 hours ago -
306 mini-petrol pumps removed
15 hours ago -
10 Kanal state land reclaimed on ombudsman’s orders
15 hours ago -
Seminar on “Taxation and E-Filling of the Income Tax” held at HCSTSI Secretariat
15 hours ago -
PBF presents budget proposals to relevant ministries
15 hours ago -
PCMEA meeting discusses intl. exhibition's preparations
15 hours ago
-
PFC budget proposals sent to Punjab govt: Mian Kashif
16 hours ago -
'FTO directs advisors to resolve businessmen issues immediately'
16 hours ago -
PIDE organizes conference on 'The Economy of Azad Jammu and Kashmir'
17 hours ago -
Pak-Uzbekistan commodity market leaders agree for joint plan of action
17 hours ago -
STZ is an environmental project-DC
19 hours ago -
Currency Rate In Pakistan - Dollar, Euro, Pound, Riyal Rates On 12 May 2024
23 hours ago