Banco Santander Central Hispano has reported a 13% increase in its fourth-quarter net profit. As a result, the group's net attributable income for 2006 was E7,596 million, an increase of 22% over the E6,220 recorded in 2005. According to the bank, these are the best results in its 150-year history.
This increase in profitability is attributable to strong growth in all of Santander’s business units during 2006. While loans grew by 20%, customer funds grew by 9%. In addition, the company did well across its diverse geographic segments. In continental Europe the group’s profits grew by 16%, while in Latin America, attributable profit grew by 29%.
According to the bank, this strong performance enabled its revenue to grow by ten percentage points more than costs, at 17% and 7%, respectively. This, in turn led to Santander’s operating profit also rising by 28% over 2005.
The strong growth experienced by Santander in 2006 has led the board of directors to approve a 25% increase in the dividends for the second consecutive year, with a charge against 2006 results of E0.5206 per share. The distribution to shareholders will come to E3.256 million, or 49.47% of ordinary profit, in line with Santander’s payout policy.
Santander’s UK subsidiary Abbey also recorded a successful 2006. The bank’s attributable profit rose 24% to E1.003 billion, through a 9% increase in loans and a 2% increase in deposits in pounds sterling.
According to International Herald Tribune, Santander has commented that approximately E1.39 million of the asset sales have been set aside for early retirement provisions and higher corporate taxes.