Spanish bank Santander releases its interim financial results for the first half of 2023.

Santander has reported attributable profit of €5,241 million ($5,802 million) for the first half of 2023, up 7 per cent compared with the same period last year, increasing earnings per share by 13 per cent.

Strong growth in revenues, particularly in Europe, offset the year-on-year growth in provisions in North and South America, where trends improved in the second quarter, the bank said in a statement. In the second quarter, attributable profit increased 17 per cent versus the second quarter of 2022 to €2,670 million, as the number of customers the group serves grew by nine million year-on-year, taking the total to 164 million.

Across regions, attributable profit in Europe in the first half of the year reached €2,536 million, up 40 per cent, as a result of strong profit growth in Spain, the UK, Portugal and Poland, the bank said. In North America, it amounted to €1,346 million, down 19 per cent, and fell by 23 per cent in South America to €1,458 million, mainly due to lower profits in Brazil and Chile, while Argentina, Uruguay, Peru and Colombia improved their performance.

Revenues were up 13 per cent, supported by solid income growth in all regions and global businesses, the bank added. Revenue growth was particularly strong in Santander Corporate and Investment Banking (24 per cent) and PagoNxt (27 per cent), which brings together Santander’s payments' businesses.

Wealth Management & Insurance
The group’s private banking, asset management and insurance businesses also delivered a strong set of results, with attributable profit increasing 70 per cent to €819 million, the bank continued. Private Banking delivered growth on the back of higher net interest income and strong commercial activity levels (+€6.4 billion in net new money and +10 per cent in the number of customers), while Santander Asset Management showed solid growth in net sales (€3.2 billion), the bank said.

Net interest income increased 15 per cent, reflecting growth in customer activity and positive balance sheet sensitivity to higher interest rates in Europe. Fee income increased 5 per cent, with good growth in payments, Santander CIB, and Wealth Management & Insurance –reflecting the strength of the group’s global businesses. The efficiency ratio also improved rising to 44.2 per cent, in spite of inflationary pressures, resulting from the group’s transformation towards a simpler, more integrated model, which contributed to enhanced profitability.

"We are making excellent progress against our strategic objectives of simplifying our business and leveraging the strength of our global network. Our results reflect that progress, with nine million customers joining us in the past 12 months, resulting in double-digit revenue growth,” Ana Botín, Banco Santander executive chair, said. 

“Credit quality remains robust, and we continue to deliver improved profitability with return on tangible equity reaching 14.5 per cent, and consistent organic capital generation with capital above our 12 per cent target. Because of this strong performance, we are creating value for shareholders, with TNAV plus cash dividend per share up 11 per cent year-on-year, and we are well on track to meet all our 2023 targets," Botín added.