LONDON — Banco Santander of Spain announced on Tuesday that its net profit fell nearly 98 percent, to 47 million euros, during the final three months of last year, as the bank dealt with the downturn in the Spanish real estate market and the European debt crisis.
The slump in quarterly profit weighed on the bank’s annual earnings. Santander said its earnings fell 35 percent, to 5.35 billion euros ($7 billion) in 2011.
During the final three months of last year, the bank, based in Madrid, said it had to set aside 1.8 billion euros to offset exposure to Spain’s troubled real estate market and an additional 600 million euros to cover a downturn in its operations in Portugal. The bank set aside a combined 3.2 billion euros for the year.
As its Spanish business continues to feel the effects of Europe’s debt crisis, Santander’s operations in other parts of the world are becoming increasingly important to its bottom line. For the first time, earnings from its Latin American division accounted for more than half of the bank’s profit in 2011. Yet even in this fast-growing market, Santander said its profit from the region fell 1 percent, to 4.6 billion euros.
Continental Europe represented almost one-third of Santander’s earnings last year, while profit from its operations in Britain and the United States totaled 12 percent and 6 percent, respectively.
Santander’s large deposit base and diversified worldwide operations have helped it to remain profitable despite the Continent’s debt crisis. Earlier this month, Santander said it had raised enough capital to meet new requirements outlined by the European Banking Authority. The regulator is pushing the region’s banks to achieve a 9 percent core Tier 1 ratio, a measure of a bank’s ability to weather financial shocks, by June.
http://dealbook.nytimes.com/2012/01/31/santanders-earnings-slump-on-european-debt-crisis/
No comments:
Post a Comment