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Montevideo, January 27th 2023 - 01:11 UTC

 

 

Santander quarterly profits plummet 90%; property losses provision of 3.5bn euros

Thursday, October 25th 2012 - 19:06 UTC
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Chairman Botin admits problematic property assets of 18.5bn Euros Chairman Botin admits problematic property assets of 18.5bn Euros

Spanish bank Santander has said its quarterly profits fell by more than 90% after taking provisions for bad property loans in its local market. Net income fell to 100m Euros in the third quarter from 1.8bn Euros in the same period last year, it said.

So far this year Santander has set aside 3.5bn Euros for provisions for property losses - a problem facing all Spanish banks.

The Spanish government has found itself in financial difficulty since the 2008 global financial crisis caused a big crash in the country's over-heated property market, and many fear that it will need a full bailout on top of the banking loan that has already been agreed.

Santander said that total problematic property assets amounted to 18.5bn euros.

“The bank's capacity to generate profit enables us to set aside hefty real estate provisions in Spain in 2012 and significantly increase non-performing loan coverage,” Santander chairman Emilio Botin said.

Loans grew in emerging market such as Latin America and Poland and declined in economies that are “de-leveraging” - that is, cutting down on debt - such as Spain and Portugal, the bank added. Spain is struggling with a shrinking economy and 25% unemployment.

Spain's banks will need an injection of 59.3bn Euros to survive a serious downturn, an independent audit recently calculated. However, Santander along with six other banks, was found to have no need for extra capital.

The Spanish government is still hoping to avoid requesting a bailout from the Euro zone rescue funds, but many think this is inevitable.
 

Categories: Economy, International.

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  • British_Kirchnerist

    And here we were in Britain thinking Santander was more trustworthy just because its not Anglo-Saxon (which shows how far the world has changed post 2008!) A bank is still a bank...

    Nov 01st, 2012 - 01:48 pm 0
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