Banco Santander, S.a. · BME:SAN
Banco Santander — Investor Presentation (November 2024)
59 slides from Banco Santander's investor presentation, November 2024
Slide 1: Institutional Presentation 9M'24
Strategic and Financial Analysis. Financial Division Institutional Presentation 9M’24
Slide 2: Index
INDEX Our business Group 9M’24 results Final Links to model and structure and & activity remarks public strategy businesses materials
Slide 3: Our business model and strategy
01 Our business model and strategy
Slide 4: Santander, a leading financial group
Santander, a 9M’24 Highlights leading financial group Total assets (€ bn) 1,802 Customer loans (€ bn excluding reverse repos) 1,013 Customer deposits + mutual funds (€ bn excluding repos) 1,174 Branches 8,134 9M'24 Net operating income (pre-provision profit) (€ mn) 26,923 9M'24 Attributable profit (
Slide 5: The Santander Way
The Santander Way Who we are and what guides us 5
Slide 6: Santander business model
Santander business model Our business model Business based on unique Digital bank In-market Geographical competitive advantages with branches & Global is the foundation for Balance sheet generating value for our shareholders Second year of our phase of value creation 6
Slide 7: Customer focus
01 Customer focus Total customers Digital customers We have grown our customer base in 171mn 58mn recent years, with +5mn +4mn balanced growth by business and region Active customers 102mn +8% Transactions per active customer 60% Products/services digitally available +2mn Note: YoY changes. 7 Transa
Slide 8: Customer focus
01 Traditional Digital Customer focus banking banking Internet, Branches, mobiles, ATMs, tablets, retail agents, … smartphones, smartwatches,… To bring all our customers to a common operating model, while converging to a Collaborative spaces and increased digital capabilities common technology Branc
Slide 9: Scale
02 Scale Retail Retail & Commercial Banking Consumer Digital Consumer Bank ONE Santander: Corporate & Investment Banking CIB ONE Santander Five global businesses Wealth Wealth Management & Insurance across our regions Payments Payments DCB North South Europe Europe America America 9
Slide 10: Scale: in-market and global
02 In-market scale Market shares Europe North America Scale 3% Auto lending 9% Loans 7% DCB 2% Deposits Deposits Europe 17% 12% Loans Loans 12% Loans South America 13% Deposits 10% Deposits 12% #1 European Deposits 17% Consumer Loans Bank Our unique combination 17% 9% Loans 19% Deposits of in-market
Slide 11: Diversification
03 Customer loans Customer deposits Diversification By product/business1 Other By product/business1 Other CIB 5% CIB 7% 14% Retail: 13% Retail: 32% home 32% individuals mortgages demand Consumer 13% deposits 21% Consumer 6% 9% 9% Retail: 16% Retail: 14% 10% other individuals Geographical Retail: ind
Slide 12: Diversification
03 Simple, transparent and easy to analyse balance sheet Diversification Medium-low risk profile Strong liquidity ratios Strong solvency ratios well above requirements Focus on capital efficiency Rock-solid and and asset rotation diversified balance sheet with Stable and diversified Highly collatera
Slide 13: In summary
Reliable risk-return profile Lower volatility of results In summary Pre-provision profit / loans EPS volatility2 3.25% 3.06% 2.94% 3.04% 2.90% 3.26% 2.83% 2.97% 2.89% 2.80% 2.49% 2.57% 2.70% 3.03% Our results show that 12% our business model Cost of risk1 38% works. It is based on 1.65% 2.44% 1.69%
Slide 14: Our three tenets
Our three tenets Delivering double-digit value creation, on average Think Value through-the-cycle A new phase of profitability and growth underpinned Building a digital bank with branches with well targeted by three tenets Think Customer products and services to grow our customer base Best customer
Slide 15: Environmental, Social and Governance
Environmental, Social and Governance Green finance raised and facilitated Socially responsible investments (AuMs) Financial inclusion (# People) We continue to make progress on 9M’24 €129.7bn €85.0bn 3.5mn our ESG agenda 2025 targets €120bn €100bn 5mn More information available at www.santander.com/
Slide 16: Group structure and businesses
02 Group structure and businesses
Slide 17: Group organizational structure
Primary segments (Global Businesses) Group Retail Consumer CIB Wealth Payments organizational structure from January 2024 Secondary segments Europe DCB Europe North America South America Group functions and Corporate Centre activities General Technology People & Financial Regulatory & Internal Strat
Slide 18: Global Businesses
@ Santander Global Businesses 18
Slide 19: Retail & Commercial Banking
Retail & Commercial Banking ‘A global business integrating all our retail and commercial banking businesses globally to better serve our customers, improve efficiency and drive value creation’ 9M’24 Highlights Strategic priorities Customer loans (€ bn) 614 Customer deposits (€ bn) 638 ▪ Implement a
Slide 20: Digital Consumer Bank
Digital Consumer Bank ‘Global leader in auto financing and digital consumer activities’ 9M’24 Highlights Strategic priorities Customer loans (€ bn) 210 ▪ Continue expanding our leadership in consumer finance and to be the lowest cost New business volumes (€ bn) 68.9 operator in the industry, with th
Slide 21: Corporate & Investment Banking
Corporate & Investment Banking ‘Santander CIB supports corporate and institutional clients, delivering tailored services and high value-added wholesale products suited to their complexity and sophistication’ 9M’24 Highlights Strategic priorities Customer loans (€ bn) 137 ▪ Our aim is to become a foc
Slide 22: Wealth Management & Insurance
Wealth Management & Insurance ‘We want to become the best wealth and insurance manager in Europe and the Americas’ 9M’24 Highlights Strategic priorities Total assets under management1 (€ bn) 493 ▪ Continue building our global platform accessing new markets and leveraging Gross written premiums (€ bn
Slide 23: Payments
Payments - ‘One-of-a-kind paytech business that offers innovative payment solutions’ 9M’24 Highlights Strategic priorities EBITDA margin 22.7% ▪ We are a one-of-a-kind paytech business backed by Santander ▪ Helping our customers prosper and accelerate their growth through a one-stop shop, providing
Slide 24: Payments - Cards
Payments - Cards ‘Provide exceptional payments experiences, fostering customer loyalty and leveraging transactional data to enhance profitability’ 9M’24 Highlights Strategic priorities # cards (mn) 105 ▪ Expand our business, in a profitable and sustainable way, developing credit and lending business
Slide 25: Secondary segments
@ Santander Secondary segments 25
Slide 26: Europe
Europe 'We continue to accelerate our business transformation to achieve higher growth and a more efficient operating model' 9M’24 Highlights Strategic priorities Branches 3,034 ▪ Focus on growing our business and transforming our operating model to improve Employees 67,232 efficiency and customer e
Slide 27: Digital Consumer Bank Europe
Digital Consumer Bank Europe ‘Europe’s consumer finance leader: solid business model, geographic diversification and leading market shares in auto/mobility finance and consumer’ 9M’24 Highlights Strategic priorities Branches 326 ▪ Become the preferred partner of our final customers and partners, off
Slide 28: North America
North America 'We provide a full range of financial services with a particular focus on Retail, Private Banking and CIB' 9M’24 Highlights Strategic priorities Branches 1,762 ▪ Remain focused on executing the transformation of our Retail and Consumer businesses in both countries. The simplification o
Slide 29: South America
South America 'Moving forward to become the primary bank for our customers and the most profitable franchise in each country in which we operate in the region, while promoting synergies across our global and regional businesses' 9M’24 Highlights Strategic priorities Branches 3,012 ▪ In Retail, we co
Slide 30: Group functions and Corporate Centre activities
Group functions and Corporate Centre activities • Global T&O strategy • HR strategy • Risk management and compliance • Corporate governance and internal control • Our brand 30
Slide 31: Technology and Operations (T&O)
Technology and Operations (T&O) ‘The T&O mission is to help Santander’s global businesses in their digital transformation, providing them a state-of-the-art global platform, with innovative capabilities and zero back office’ Global T&O capabilities are key for our digital transformation Composed of
Slide 32: HR strategy: Our aim is to be an employer of choice
HR strategy: Our aim is to be an employer of choice 'Focus on employee engagement, leveraging our SPF culture to retain and attract the best talent' Our corporate management The SPF culture is based on our 5 corporate behaviours evaluation model 208,080 Employees (Sep-24) 50% 40% Continuous Employee
Slide 33: Risk, Compliance & Conduct management
Risk, Compliance & Conduct management Proactive, customer-centric management, that seeks to maintain our medium-low risk profile Risk, Compliance & Conduct management model that relies on: Advanced management tools that help us carry out effective risk management A 3 lines of defence model with a ri
Slide 34: Corporate governance and internal control
Corporate governance and internal control ‘As a responsible bank, we have clear and robust governance to ensure a long-term sustainable business model’ Composition of the board of directors, Sep-24 Board committees Executive Diversified and well-balanced shareholder base 20.0% Audit Non-executive di
Slide 35: Corporate governance and internal control
Corporate governance and internal control 'Best practices on robust governance are channelled to all subsidiaries' Group-subsidiary governance model Group Subsidiary B The Group-subsidiary governance model enhances control and oversight through: Board of Directors Subsidiary A A Presence of the Grou
Slide 36: Santander brand
Santander brand 'Our brand embeds the essence of the Group's culture and identity' Santander is one of the most valued brands in the world 3 rd Best Global Retail Bank Brand by Interbrand’s Best Global Brands Ranking, 2024 As one of our most important strategic assets, our brand helps us connect wit
Slide 37: 9M'24 results & activity
03 9M'24 results & activity «> Santander
Slide 38: Record 9M'24 results across all global businesses
Record 9M’24 results with all our global businesses contributing to our 2024 targets Q3’24 9M’24 attributable profit attributable profit Another record quarterly profit driving double-digit profit growth in 9M’24 with revenue up high-single digits €3.3bn +12% vs. Q3’23 €9.3bn +14% Efficiency RoTE St
Slide 39: Double-digit profit and net operating income growth YoY
Double-digit profit and net operating income growth YoY, supported by customer revenue and efficiency improvements P&L Current Constant € million 9M'24 9M'23 % % NII 34,682 32,139 8 9 Net fee income 9,666 9,222 5 6 Excellent business and commercial dynamics Other income 1,837 1,734 6 9 continued in
Slide 40: On track to deliver on full-year 2024 targets
On track to deliver on our full-year 2024 targets, which we upgraded last quarter … 9M’24 2024 targets High-single Revenue1 +8% digit growth Efficiency 41.7% c.42% CoR 1.2% c.1.2% FL CET1 12.5% >12.0% after FL Basel III implementation RoTE 16.2% >16% (1) YoY change in constant euros, except Argentin
Slide 41: ONE Transformation improving revenue and costs
… backed by our execution of ONE Transformation, improving both revenue and costs… Global & Network Global Tech FY’22 ONE Transformation businesses capabilities & others 9M’24 45.8% -259bps -82bps -72bps 41.7% • Product simplification: 16% fewer • Multi-Nationals: +3% YoY • Global approach to techno
Slide 42: Five global businesses accelerating profitable growth
… and by our five global businesses, leveraging our global scale to accelerate profitable growth Revenue Contribution to 2025 RoTE C/I RoTE 9M’24 (€bn) Group revenue target 24.2 39.3% 18.5% Retail +9% 52% -4.2pp +3.6pp c.17% 9.6 40.7% 11.9% Consumer 20% -1.9pp +0.3pp >14% +5% CIB 6.3 44.4% 18.1% >20
Slide 43: Retail: global platform deployment driving 9% revenue growth
Retail: global platform deployment driving 9% revenue growth while holding costs flat Execution of the strategy 9M’24 financials Driving growth and efficiency on the back of our new model Loan anss Deposits CoR and proprietary technology €614bn €638bn 0.98% Customer Digital onboarding and simpler cu
Slide 44: Consumer: operational leverage and deposit cost-to-serve
Consumer: strong improvement in operational leverage and deposit cost-to-serve Execution of the strategy 9M’24 financials Transforming into a best-in-class, global business and Loans Deposits CoR operating model €210bn €123bn 2.12% Customer Fully-digital financing experience available for our auto p
Slide 45: CIB: US investments drove 15% fee growth
CIB: US investments drove 15% fee growth and strong RoTE of 18% Execution of the strategy 9M’24 financials Playing to our strengths to better serve our corporate Loans Deposits CoR customers and institutions €137bn €127bn 0.21% Customer Upgraded product offering in US driving growth with global clie
Slide 46: Wealth: strong activity and 81% RoTE
Wealth: strong activity, collaboration fees up 13% and 81% RoTE Execution of the strategy 9M’24 financials Accelerating our customers’ connectivity with our global Net new Net sales Gross written product platforms money (PB) (SAM) premiums €13.2bn €12.5bn €9.0bn Customer Enhanced customer experience
Slide 47: Payments: revenue increase and PagoNxt EBITDA margin
Payments: solid revenue increase and profitability, with PagoNxt EBITDA margin of 23% Execution of the strategy 9M’24 financials Seizing a growing opportunity by capturing scale through Loans TPV Turnover global platforms Getnet Cards €23bn €163bn €241bn Customer Click to Pay improved with new funct
Slide 48: Building capital organically with higher shareholder remuneration
Building capital organically and delivering double-digit value creation with higher shareholder remuneration FL CET1 TNAVps + Cash DPS Shareholder remuneration % € per share Cash DPS: €19.5 cents +0.2pp +14% Cash dividend 5.23 in 2024 12.3 +1.36 12.5 +39% YoY -0.74 -0.42 5.04 Current share buyback 4
Slide 49: Final remarks
04 Final ce remarks «> Santander
Slide 50: Consistently delivering on Investor Day targets
Consistently delivering on our Investor Day targets, with double-digit value creation for our shareholders 9M’24 vs. 2025 ID targets Strength Disciplined capital allocation FL CET1 RWAs with RoRWA > CoE 12.5% TNAVps + DPS 86% +14% >12% c.85% Double-digit growth average through-the-cycle Shareholder
Slide 51: Record profit; positioned for sustained growth and value creation
Record quarterly and 9M profit. Well positioned to deliver sustained growth, increased profitability and shareholder value creation 9M’24 Record profit supported by an outstanding P&L from top to bottom RoTE EPS Excellent business dynamics: record NII, fees, revenue and net operating income ONE Tran
Slide 52: Links to public materials
05 Links to public materials «> Santander
Slide 53: Links to Grupo Santander public materials
Links to Grupo Santander public materials For additional information on the Group, please click on the images or icons below 9M’24 financial results Other information Financial report Earnings presentation Series Shareholders report 2023 Digital annual review Global business Press release Fixed inco
Slide 54: Glossary
Glossary «> Santander
Slide 55: Glossary - Acronyms
Glossary - Acronyms • A2A: account to account • EV: Electric Vehicle • ps: Per share • ALCO: Assets and Liabilities Committee • FL: Fully-loaded • QoQ: Quarter-on-Quarter • AM: Asset management • FTE: Full time employee • Repos: Repurchase agreements • AuMs: Assets under Management • FX: Foreign exc
Slide 56: Glossary - Definitions
Glossary - Definitions PROFITABILITY AND EFFICIENCY • RoTE: Return on tangible capital: Group attributable profit / average of: net equity (excluding minority interests) – intangible assets (including goodwill) • RoRWA: Return on risk-weighted assets: consolidated profit / average risk-weighted asse
Slide 57: Important information
Important information Non-IFRS and alternative performance measures This presentation contains financial information prepared according to International Financial Reporting Standards (IFRS) and taken from our consolidated financial statements, as well as alternative performance measures (APMs) as de
Slide 58: Important information
Important information While these forward-looking statements represent our judgement and future expectations concerning our business developments, results may differ materially from those anticipated, expected, projected or assumed in forward-looking statements. In particular, forward looking statem
Slide 59: Thank You
Thank You. Our purpose is to help people and businesses prosper. Our culture is based on believing that everything we do should be:
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