Santander hikes 2017 dividend: Chair wants growth in market share not fees

 
Oliver Gill
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Santander chairman Ana Botin was speaking in the port town of Santander (Source: Getty)

Santander will reward investors by increasing its dividend by five per cent, the bank's chair, Ana Botin, told shareholders today.

The returns would total €0.22 per share, meaning dividend growth is in line with previous years.

Investors will receive three of the bank's four dividends in cash, with an option to take the fourth as either cash or stock.

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When Botin took over as chair in 2015 from her late father Emilio, she was quick to cut Santander's dividend, before putting a five per cent increase in place in 2016.

The Spanish lender has gone great guns in the last year, with shares up some 60 per cent as compared with European banking indices rising around 30 per cent over the same period.

While margins remain tight within Europe, Santander has benefited from its presence in Brazil.

Meanwhile, its focus is on growing market share rather than fees, Botin said.

"We have a great platform to keep growing profitability. If IMF estimates are met, 2017 will be the first year since 2010 when there will be economic growth in our top 10 markets," she said, according to Reuters.

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Botin also said the bank knows "what needs to be done" in the US to deal with a series of issues it is facing.

Santander has failed US stress tests for the last three years in a row. Chief executive Jose Antonio Alvarez said it had made significant progress in improving risk control over the last year.

Consumer protection issues have also weighed on the lender and it has promised to increase its efforts after US regulators found Santander charged unfair interest rates on car and other automobile loans.

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