Santander’s UK profits up

SPANISH banking group Santander is expected to unveil a 27 per cent jump in profits from its British operations this week.

Abbey, Alliance & Leicester and Bradford & Bingley will report pre-tax profits of £2.2bn, up from £1.6bn, according to analysts. The overall group is predicted to report a marginal rise in pre-tax profits from €11.4bn (£10.2bn) in 2008 to €12bn.

The figures confirm the bank weathered the recession relatively well, and will make welcome reading for Santander’s 1.8m British shareholders who kept their paper after the bank swallowed the three building societies. The group, named after a coastal city in northern Spain, has around 1,300 branches in the UK and was responsible for around a fifth of the mortgages issued last year.
It is currently rebranding all its outlets under the Santander badge.

Separately, Santander is understood to have flagged an initial interest in 318 branches put up for sale by Royal Bank of Scotland under the European Commission’s orders. National Australia Bank and Virgin Money are also thought to have responded to the “teaser document” sent out by RBS in the first stage of the sale process, which is designed to encourage more competition in the retail banking sector.

Although the three contenders have been in touch with investment bank UBS, which is handling the transaction, the sale process is likely to be lengthy. The branches will be sold off as a single batch, giving the buyer a ready-made network.

An RBS spokesperson said: “All disposals will progress at a pace which secures the interests of both our customers and shareholders.”