Spanish banking giant Santander announced record annual profits for a third consecutive year on Wednesday as a strong commercial performance offset the impact of falling interest rates.
Spain’s biggest bank, a major player in Europe and Latin America, posted a net profit of 12.5 billion euros ($13 billion) in 2024, an increase of 14 percent on the previous year.
Net interest income, a key measurement of a bank’s performance, increased eight percent as the bank swelled its customer numbers by eight million to reach a total of 173 million.
Growth was recorded in all regions and divisions, particularly in retail in Europe and South America.
“Our track record shows that in a challenging market we outperform peers,” executive chair Ana Botin said in a statement.
“In 2025, we expect to grow our bottom line and profitability — with revenue stable and costs falling. And we are only scratching the surface of our potential.”
Investors were encouraged by the latest bonanza, with Santander’s share price rocketing by more than seven percent on Spain’s Ibex 35 stock exchange and reaching its highest level since 2018.
The European Central Bank has cut eurozone borrowing costs five times since June 2024 as the 20-nation area’s economy stagnates.
Higher interest rates aimed at taming runaway inflation had bolstered sector profits in the aftermath of the Covid-19 pandemic and Russia’s invasion of Ukraine in 2022.
Santander also shrugged off a windfall tax by Spain’s left-wing coalition government which forced it to set aside 335 million euros at the beginning of 2024.
The Spanish parliament approved a new tax on banking giants last year to replace the exceptional measure that expired at the end of 2024, angering industry groups.
– UK market ‘not for sale’ –
The bank said it expected to return 10 billion euros to shareholders through share buybacks from 2025 and 2026 earnings and anticipated excess capital, in addition to standard cash dividends.
The group’s latest results come as speculation mounts about its UK operations after media reports that it was considering quitting the British market.
Botin told a press conference on Wednesday that “our business in the United Kingdom is not for sale”.
Britain was “one of our main markets”, representing around nine percent of the group’s total, and “we hope that this year it does the same or better,” she added.
But Santander UK chair William Vereker has announced he will leave his post this year, a decision which business media attributed to disagreements with Botin.
