Santander sees UK growth but bad Spanish loans dent profits

Tim Wallace
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BANKING giant Santander claimed it has now moved beyond the Spanish housing crash, setting it up for solid growth in the coming years.

Profits plunged 59 per cent to €2.205bn (£1.9bn) for 2012, in large part due to bad loan provisions of €6.14bn. But the bank’s UK arm reported gains, seeing post-tax profits rise four per cent to £939m.

Margins in Britain were squeezed by low interest rates and pushed operating income down five per cent to £4.901bn.

Meanwhile expenses fell nine per cent to £2.222bn, pushing up profits.

Current account deposits increased 32 per cent on the year on the back of a major advertising campaign.

But gross mortgage lending fell 38 per cent to £14.6bn in the year.

“We look forward to greater regulatory clarity, regarding capital, liquidity, conduct and governance, as this will provide us with the certainty we need to continue to support the UK economy,” said chief executive Ana Botin.