Santander's net profit climbs 8%


Banco Santander's (SAN) Q1 net profit rose to €1.3B ($1.8B) from €1.2B a year earlier and exceeded forecasts that were also €1.2B, boosted by an improving economy and falling charges for bad loans.

Net interest income slipped 3% to €6.99B from €7.21B.

Provisions for bad loans fell 14.2% to €2.69B as the non-performing loan ratio dropped to 5.52% from 5.64%.

Profit breakdown: Spain +24% to €251M; U.K. +63% to €376M; Latin America -26.6%, hurt by currency fluctuations.

Separately, Santander intends to acquire the 25% of Banco Santander Brasil (BSBR) that it doesn't own for €4.69B in shares, with the price representing a 20% premium.

Shares are +0.7% in Madrid. (PR)

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Comments (16)
  • Debutant
    , contributor
    Comments (2778) | Send Message
     
    My comment (Long version):

     

    Plus, the bank has a prudent management style; doesn't let its name get associated with shady operations; distributes quarterly a generous dividend; its share price is up significantly from the lows of 2012; keeps growing geographically.

     

    Every time that an anonymous author from the USA tried to bash the stock here on SA I warned the readers to ignore the propaganda.

     

    My comment (Short version): I told you so!

     

    Discl.: SAN is the single largest position in my portfolio.
    29 Apr 2014, 04:30 AM Reply Like
  • 6228371
    , contributor
    Comments (7365) | Send Message
     
    SAN is also my largest individual stock position. I was trying to find earnings estimates for SAN for 2014. I found one on Bloomberg, however it is just a single number.

     

    http://bloom.bg/1se7kWU
    29 Apr 2014, 06:42 AM Reply Like
  • Debutant
    , contributor
    Comments (2778) | Send Message
     
    6228371,

     

    For a rich collection of news, numbers and the interpretation therof I suggest that you read the blog initiated and managed by Vincent and contributed by his friends who are also retail SAN investors.

     

    Vincent is the best on SAN; he and his friends/contributors are smart enough not to be fooled by fearmongering anonymous authors.
    http://bit.ly/1pJNown
    29 Apr 2014, 09:05 AM Reply Like
  • WLDunst
    , contributor
    Comments (75) | Send Message
     
    Long SAN at <6$. Great management and geographically diverse.
    29 Apr 2014, 05:54 AM Reply Like
  • Strike
    , contributor
    Comments (2234) | Send Message
     
    Superb bank. Management has kept all its promises.
    29 Apr 2014, 07:00 AM Reply Like
  • KURTKAMM
    , contributor
    Comments (196) | Send Message
     
    Love it too, but when do they change the crazy dividend policy?
    29 Apr 2014, 08:56 AM Reply Like
  • 6228371
    , contributor
    Comments (7365) | Send Message
     
    "Love it too, but when do they change the crazy dividend policy? "

     

    What is crazy about the dividend policy? I love the scrip dividend.
    29 Apr 2014, 08:59 AM Reply Like
  • Debutant
    , contributor
    Comments (2778) | Send Message
     
    A generous dividend, paid quarterly, with the option to receive it in cash or in new shares (free of Spanish withholding).

     

    SAN's dividend is not crazy. Calling it so is.
    29 Apr 2014, 09:12 AM Reply Like
  • PVFederico
    , contributor
    Comments (542) | Send Message
     
    Also note that Latin America was down due to currency adjustments. That is, the real reason to own this stock -- its future in a Latin American fueled by a growing middle class, which is turning these economies into consumer growth engines -- was down.

     

    These Latin American currencies were dragged down by the general sell off in emerging market currencies. Watch the strong positive affect on earnings when this situation stabilizes. These currencies don't have to strengthen, only stabilize, and SAN's bottom line will see a big jump. And with the buy-back of the rest of the Brazil entity, the inevitable recovery of that economy will be a further positive stimulus.

     

    The stars for this stock are lining up, not just for the immediate future, but for the next thirty years. This is one of my oldest holdings, and my favorite. I keep selling puts in an attempt to get a better price, but I may just buy more now before it completely gets away from me.
    29 Apr 2014, 10:11 AM Reply Like
  • BTR2RSK
    , contributor
    Comments (228) | Send Message
     
    Not much of a rise today after positive earnings. I wonder how SAN will be impacted when Ukraine deteriorates further.
    29 Apr 2014, 03:23 PM Reply Like
  • KURTKAMM
    , contributor
    Comments (196) | Send Message
     
    Debutant- SAN's dividend policy is incredibly dilutive in the long run. Do the numbers.
    29 Apr 2014, 06:06 PM Reply Like
  • 6228371
    , contributor
    Comments (7365) | Send Message
     
    "Debutant- SAN's dividend policy is incredibly dilutive in the long run. Do the numbers. "

     

    It is only dilutive for those who take the dividend in cash. Since a small percentage of shareholders do take the dividend in cash, those who take it in shares experience a very slight increase in their percentage ownership of the company.
    29 Apr 2014, 07:47 PM Reply Like
  • BTR2RSK
    , contributor
    Comments (228) | Send Message
     
    4.69 B Euros in shares will be used to acquire the 25% of Banco Santander Brasil (BSBR) it doesn't already own. Is SAN issuing new shares to do this and if so won't this drastically dilute current shareholder's equity? The profits from this acquisition would need to surpass this amount otherwise it will be a drag on earnings. Has anyone analyzed this and would like to share?
    1 May 2014, 11:03 AM Reply Like
  • 6228371
    , contributor
    Comments (7365) | Send Message
     
    "Is SAN issuing new shares to do this and if so won't this drastically dilute current shareholder's equity?"

     

    Just off the top of my head it seems like it will probably add to EPS, as the p/e ratio for BSBR is less than that of SAN.
    1 May 2014, 02:48 PM Reply Like
  • BTR2RSK
    , contributor
    Comments (228) | Send Message
     
    622, Thanks and where do you get that info? My brokerage RBC says P/E Ratio (TTM) 1,191.2x & EPS (TTM) 0.01. Google Finance also says something similar.
    1 May 2014, 03:03 PM Reply Like
  • 6228371
    , contributor
    Comments (7365) | Send Message
     
    It looks like BSBR earned 67 cents a share in 2013 and is expected to earn around 60 cents a share this year
    1 May 2014, 03:34 PM Reply Like
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