1/31/2012 4:38 AM ET
(RTTNews) - Spanish lender Banco Santander SA (STD: News ,BNC.L: News , BCDRF.OB) reported Tuesday nearly 35 percent decline in 2011 profit, hurt by lower earnings from Brazil and the UK as well as charges related to property exposure in Spain.
Full-year attributable profit to the Group fell 34.6 percent to 5.35 billion euros from last year's 8.18 billion euros. Earnings per share decreased 36 percent to 0.5974 euros from 0.9356 euros a year earlier. Profit for the year from continuing operations dropped 13.7 percent to 7.88 billion euros.
The bank decided to realize net extraordinary charges of 3.18 billion euros in the results, of which 1.51 billion euros were drawn from capital gains and 1.67 billion euros from fourth quarter profit.
The bank charged pretax provisions in the fourth quarter against real estate exposure in Spain of 1.81 billion euros and a pretax amortization of 600 million euros from goodwill related to its businesses in Portugal.
Excluding these, recurring profit for the year would have been 7.02 billion euros, a decline of 14 percent. Recurring profit for the fourth quarter was 1.72 billion euros, lower than prior year's 2.01 billion euros.
For the first time in the bank's history, Latin America contributed more than half of profit at 51 percent. Excluding a 7 percent decline in attributable profit from Brazil, Latin American profit increased 11 percent.
The company also noted that profit from Continental Europe fell 15 percent despite strong growth in Santander Consumer Finance unit. UK profit plunged 41 percent, while that of Sovereign grew 30 percent. Attributable profit in the U.S. climbed 37 percent.
For the year, revenue grew 5.3 percent to 44.3 billion euros in 2011, with net interest income increasing 5.5 percent to 30.82 billion euros.
Net operating income before provisions rose 2.2 percent to 24.37 billion euros that "underlines the Group's ability to generate future earnings, in a situation where lower requirements for provisions will feed through to net profit," the company noted.
The bank said its costs increased 9 percent to 19.90 billion euros in part due to investment in new branches and new business lines in emerging markets units.
Santander on January 9 said it has achieved a core capital ratio of 9 percent following a series of measures taken during the last few months, ahead of the European Banking Authority or EBA's deadline of June 30th. The bank also reiterated then its goal to reach 10 percent core capital at the close of June.
Santander Chairman Emilio Botín today said, "Banco Santander has shown it is able to generate results and, at the same time, meet the capital requirements set out by the EBA, significantly increase provisions for property exposure and maintain shareholder remuneration at EUR 0.60 per share for the third consecutive year."
 | | To receive FREE breaking news email alerts for Banco Santander Central Hispano SA and others in your portfolio |
|
1
2
Next Page