Santander in £426m profit

SANTANDER, the eurozone’s largest bank, grew its UK profits by more than 15 per cent in the first quarter as it bit off a greater market share in mortgage lending.

The Spanish giant yesterday said trading profits were £426m in the three months to March. In a challenge to Britain’s high street players, Santander expanded its gross mortgage lending nine per cent to £5.7bn – equal to a fifth of the total market.

Net deposits across retail, corporate and private banking soared 240 per cent to £3bn year-on-year.

The UK joined Brazil as one of the bright spots in the organisation’s results. At a group level net income jumped 5.7 per cent to €2.21bn (£1.9bn), with earnings at €0.25 per share. The numbers cement the impression given by BBVA’s figures this week that Spain’s lenders are in a better position than many of their European counterparts, having avoided the worst of the US sub-prime fallout due to strict national regulations.

However, the institution’s non-performing loan ratio rose to 3.34 per cent of assets at the end of March.

Chairman Emilio Botín said Santander was benefiting from its diversification “both in terms of geography and business lines”.

London-listed shares in Santander bobbed up 8p per cent to 811p on the news. Pundits including analysts at Kepler Capital Markets put out positive notes, saying the announcement was enough to make onlookers “forget the Spanish troubles”.

Standard & Poor’s Equity Research maintained its “strong buy” rating but cut its price target to €13.