The bank expects a return on tangible equity (RoTE) of 16% in the first quarter
MADRID, 22 Mar. (EUROPA PRESS) –
Banco Santander will allocate more than 6,000 million euros in cash dividends and share buybacks against its 2024 results, in line with its shareholder remuneration policy, as announced this Friday by the entity’s president, Ana Botín, during the general meeting of shareholders to be held by the bank in Boadilla del Monte (Madrid).
Santander’s shareholder remuneration policy involves distributing approximately 50% of the group’s attributable net profit (excluding impacts without cash effect or direct effect on capital ratios), distributed approximately equally in cash dividends and share repurchases. .
Last year, the bank achieved record results, allowing a record amount of €5.5 billion to be allocated to shareholders (cash dividends and buybacks).
As reported by the bank in a statement, Botín will also announce at this Friday’s meeting that Santander is on track to meet the 2024 objectives.
“2024 has begun with excellent business dynamics and results. We continue to grow in clients (2 million), and thanks to this our income will grow around 9% year-on-year (in current euros) in the first quarter,” Botín will state at the meeting. .
Likewise, the president of Santander will point out that costs have now been flat for three quarters, which, together with the impact on costs and income of the ongoing transformation, will allow “a continuous improvement in the efficiency ratio, up to 42.7%” , with which the bank hopes to close the first quarter.
“The cost of risk will be in line with our forecasts for the year thanks to an improvement in Europe, neutralized by the impact of portfolio growth in Latin America, and the expected normalization in the Consumer business. The capital ratio remains above of 12%, in line with the 2024 objective,” Botín will point out.
The president of the bank will defend to the shareholders the “many growth engines” that the group has right now.
“We expect our Retail business, for example, to achieve a return on tangible capital (RoTE) of more than 16% in the first quarter, annualizing the impact of the banking tax in Spain, recorded entirely in January 2024, thanks to the good performance of South America and Spain. The Consumer business will increase the net margin around 6%, driven mainly by the strength of the business in Europe,” Botín will highlight.
All of this will allow the entity to reach a RoTE for the group of 16% already in the first quarter, annualizing the impact of the banking tax in Spain, and with an expected growth of TNAV plus the dividend per share above 13%. % year-on-year.
“I have great confidence in closing 2024 much better than 2023, which was already a great year, and that we will meet our objectives for the year. In that case, the bank plans to allocate more than 6,000 million euros in cash dividends and share buybacks charged to 2024 results,” the president will state at the meeting.
According to Botín, the business models and common objectives in the Retail and Consumer businesses, which represent 65% of the group, will allow the bank to grow more in clients and income and structurally change its cost base, which improves profitability. .
“Our strategy is to offer competitive prices, excellent service and be a bank you can trust. For the largest retail banking customer, we are carrying out a global transformation to become a digital bank with branches,” Botín will explain.
This year marks the tenth anniversary of Ana Botín as president of Santander. In this sense, the bank has highlighted that, since 2013, it has almost tripled profits, improved RoTE by 50%, and multiplied by seven the amount allocated to shareholders (cash dividends and share buybacks).
In this period, the bank has also increased the number of clients by almost 60 million, and reinforced CET1 capital with more than 30,000 million euros.
“I am very proud of my team, around the world, and of what we have achieved together; and also of what awaits us moving forward and their conviction of the goal to achieve. My vision and my responsibility, on the first day and in the coming years, is to lead Santander to be one of the banks that leads the transformation of the financial sector, while we continue to improve profitability and the value created for shareholders every year,” the president will say about her ten years as president.
This Friday, Banco Santander will submit to the approval of its ordinary general meeting of shareholders the distribution of a complementary cash dividend for a gross amount of 0.095 euros per share.
Consequently, the total cash dividend per share charged to 2023 results will be 17.6 euro cents, which represents an increase of approximately 50% compared to the cash dividend charged to the previous year.
Said dividend, subject to the approval of the board, would be payable starting next May 2, so the last day of trading of the share with the right to receive the dividend would be April 26, the share would be listed ex-dividend on April 29 and the registration date would be April 30.
In this way, and taking into account the buyback that is currently being carried out, the total shareholder remuneration with respect to the 2023 results will reach 5,538 million euros, 50% of the group’s attributable net profit in 2023, divided into parts approximately equal between cash dividend (2,769 million euros) and buyback programs (2,769 million euros).
This amount represents an equivalent profitability of approximately 10%.
Thus, Santander’s payout (the proportion of profits distributed to shareholders) increases from 40% to 50% of the attributed profit, in line with the new shareholder remuneration policy announced a year ago.
The board of directors of Banco Santander will also submit to a vote this Friday the appointments of Carlos Barrabés and Antonio Weiss as new independent directors.
Barrabés and Weiss will fill the vacancies left by Bruce Carnegie-Brown, who will leave the board after the meeting, and Ramiro Mato, who will not stand for re-election and will leave the board after the meeting, once regulatory approval for the appointment is obtained. by Antonio Weiss.
The board of directors of Banco Santander is made up of 15 members, of which two thirds are independent and 40% are women.
