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UK now Santander's biggest market | |
(about 3 hours later) | |
The UK has become Santander's most profitable market, generating just over a fifth of the bank's profits in the first half of 2015. | The UK has become Santander's most profitable market, generating just over a fifth of the bank's profits in the first half of 2015. |
Pre-tax profits in the UK rose £74m to £928m, while revenues were up 5%. | Pre-tax profits in the UK rose £74m to £928m, while revenues were up 5%. |
The results eclipsed the €1bn (£700m) posted by the Spanish bank's Brazilian operation, which saw its revenues jump by 9%. | The results eclipsed the €1bn (£700m) posted by the Spanish bank's Brazilian operation, which saw its revenues jump by 9%. |
Overall, the bank posted a 24% rise in attributable profit to €3.24bn, but was flat at €2.99bn on the pre-tax level. | Overall, the bank posted a 24% rise in attributable profit to €3.24bn, but was flat at €2.99bn on the pre-tax level. |
Nathan Bostock, chief executive of Santander UK, said: "We are well placed to benefit from the positive economic outlook, although future earnings will be impacted by the bank corporation tax surcharge announced in the recent UK Budget. | Nathan Bostock, chief executive of Santander UK, said: "We are well placed to benefit from the positive economic outlook, although future earnings will be impacted by the bank corporation tax surcharge announced in the recent UK Budget. |
"Nevertheless, I am confident that we can continue to grow the business, whilst maintaining balance sheet strength." | "Nevertheless, I am confident that we can continue to grow the business, whilst maintaining balance sheet strength." |
Although a flotation of the UK business has been mooted for some years, Mr Bostock said he did not expect it to happen "for the next couple of years". | |
UK lending rose nearly 3% in the second quarter, while the bank also benefited from the strong pound and an increased focus on business loans. | |
In February, Santander announced a near-£44m seven-year deal to sponsor London's 11,000 bicycles for hire, taking over from Barclays. | In February, Santander announced a near-£44m seven-year deal to sponsor London's 11,000 bicycles for hire, taking over from Barclays. |
Spanish profits up | Spanish profits up |
Santander chief financial officer Jose Garcia Cantera said on Thursday that higher UK tax rates and the bank levy would result in a £500m hit to the UK operations by 2020. | Santander chief financial officer Jose Garcia Cantera said on Thursday that higher UK tax rates and the bank levy would result in a £500m hit to the UK operations by 2020. |
In its home market of Spain, profits were up 50% to €771m despite a dip in revenues as charges against bad debts fell. | In its home market of Spain, profits were up 50% to €771m despite a dip in revenues as charges against bad debts fell. |
Spain accounted for 16% of profits, with Europe making up 54% of the total. | Spain accounted for 16% of profits, with Europe making up 54% of the total. |
Brazil accounted for 20%, while the rest of Latin America had a 37% share. | Brazil accounted for 20%, while the rest of Latin America had a 37% share. |
Emerging economies - Latin America and Poland - accounted for 41% of profit, while mature markets contributed the remaining 59%. | Emerging economies - Latin America and Poland - accounted for 41% of profit, while mature markets contributed the remaining 59%. |
Ana Botin, Santander chairman, said the first-half results showed the "soundness and consistency" of the bank's business model. | Ana Botin, Santander chairman, said the first-half results showed the "soundness and consistency" of the bank's business model. |
Santander is worth €91bn (£64bn), making it the eurozone's most valuable bank and the world's 11th largest. | Santander is worth €91bn (£64bn), making it the eurozone's most valuable bank and the world's 11th largest. |
Shares fell 1.5% to €6.40 in Madrid on Thursday. The stock is down 17% over the past 12 months. | Shares fell 1.5% to €6.40 in Madrid on Thursday. The stock is down 17% over the past 12 months. |
In January, Santander tapped shareholders for €7.5bn to bolster its balance sheet amid stricter EU regulation and greater competition. | In January, Santander tapped shareholders for €7.5bn to bolster its balance sheet amid stricter EU regulation and greater competition. |
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