Banco Santander has published a strong set of results this week, posting profits of 8.1 billion euros for 2021.
The results confirm that the bank has bounced back resiliently from the net loss of 8.7 billion euros recorded for 2020, with the performance in the final quarter of the year seeing its most profitable quarter for 12 years.
The bank also released pandemic related provisions of 750 million euros in the final quarter, as it continues to forecast an economic recovery in all its main markets.
The profits published this week beat analysts’ forecasts and resulted in the share price increasing following the announcement.
Speaking about the bank’s performance, Executive Chair, Ana Botín, thanked employees in their efforts ‘to help the bank achieve the extraordinary results’. She went on to explain the drivers behind the strong performance, saying that ‘our customer focus and resilient business model have helped produce strong results’.
She also highlighted that growth in customer numbers had been significant, saying ‘we have added 5 million new customers in the last 12 months alone’.
Botín also described the focus on digitalisation for the future of the bank, saying that ‘we are building the Santander of tomorrow’. With plans to expand in this area, she said that ‘we are growing in a profitable way our Digital Consumer Bank’.
The bank has performed strongly in North America and Europe, with the UK’s performance particularly robust. The bank is also expanding into emerging economies, in search of faster growth than in Europe, where it has also focussed on reducing costs to combat prevailing low interest rates.
The cost cutting by the bank has caused controversy over the last 12 months, with branch and ATM closures in Spain, along with job cuts associated with the closures.
Santander is not alone in adopting this strategy, with the banking sector in Spain cutting 19,000 jobs during 2021.
It has been estimated that 11% of bank branches in Spain overall have been closed since the start of the Covid pandemic.
Other banks in Spain also published strong results this week, with BBVA, Caixabank and Sabadell all reporting healthy profits for 2021.
As the economic recovery continues into 2022, the Spain’s banking sector is well placed to develop on its 2021 performance.
Santander look poised to expand its online banking capabilities to ensure that it continues to grow its market share, particularly in consumer banking.