Banco Santander, S.a. · BME:SAN
Banco Santander — Q1 2021 Earnings Presentation
112 slides from Banco Santander's earnings presentation, Apr 28, 2021
Slide 1: Form 6-K
FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Report of Foreign Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 For the month of April, 2021 Commission File Number: 001-12518 Banco Santander, S.A. (Exact name of registrant as specified in its char
Slide 2: Table of Contents
BANCO SANTANDER, S.A. ________________________ TABLE OF CONTENTS Item 1. January - March 2021 Earnings presentation
Slide 3: Q1'21 Earnings Presentation
Q1’21 Earnings Presentation All. Together. Now. 28 April 2021
Slide 4: Important information
2 Important information Non-IFRS and alternative performance measures This presentation contains, in addition to the financial information prepared in accordance with International Financial Reporting Standards (“IFRS”) and derived from our financial statements, alternative performance measures (“AP
Slide 5: Important information
3 Important information Numerous factors could affect our future results and could cause those results deviating from those anticipated in the forward-looking statements. Other unknown or unpredictable factors could cause actual results to differ materially from those in the forward-looking statemen
Slide 6: Index
4 Index 1 Highlights and Group performance Appendix 3 Business areas review Key takeaways 2 4
Slide 7: Highlights
5 Highlights Note: Changes in constant euros (1) 12 month rolling. Considering annualized 3M’21 provisions, cost of credit would be 0.84% in Q1’21 (1.62% in Q1’20) (2) The bank is accruing 40% of the underlying profit for shareholder remuneration, once supervisors allow Growth • Net operating income
Slide 8: Activity in Q1'21 recovering at different speeds
6 • Low interest rates. Brazil started to raise interest rates in Q1’21 • New sizable fiscal stimulus in the US (relaunched Paycheck Protection Program) • Guarantee programmes extended • The UK published a roadmap to exit lockdown from March • Gradual easing of restrictions in the US • Lockdowns and
Slide 9: Group Performance
Group Performance @& Santander
Slide 10: Q1 underlying profit of EUR 2 billion
8 EUR mn Q1'21 Q1'20 Euros Constant euros NII 7,956 8,487 -6 5 Net fee income 2,548 2,853 -11 0 Trading and other income 886 474 87 95 Total income 11,390 11,814 -4 8 Operating expenses -5,118 -5,577 -8 0 Net operating income 6,272 6,237 1 15 LLPs -1,992 -3,909 -49 -43 Other results -467 -372 26 42
Slide 11: Strong performance in revenue, costs and LLPs
9 3,487 2,967 2,563 2,650 1,992 Q1'20 Q2 Q3 Q4 Q1'21 5,111 4,924 5,071 5,283 5,118 5,454 5,342 5,959 5,783 6,272 10,565 10,266 11,030 11,066 11,390 Strong performance in revenue, costs and LLPs in the quarter Net operating income Note: data in constant euros Total income Costs 192 1,456 1,716 1,423
Slide 12: Net interest income
10 Net interest income Constant EUR mn • YoY growth in loans (+2%) and deposits (+8%) • Interest rates remained much lower YoY, despite the recent hike in Brazil (+75 bps) • Positive impact of cost of deposits management and TLTRO contribution • QoQ performance affected by seasonality NII was 5% hig
Slide 13: Fee income recovered to pre-pandemic levels
11 Net fee income Constant EUR mn Net fee income recovered to pre-pandemic levels, growing in higher value-added services and products 2,543 2,208 2,399 2,460 2,548 Q1'20 Q2 Q3 Q4 Q1'21 +0.2% vs. Q1’20 • Q1 affected by new lockdowns and seasonality in Brazil • Positive YoY performance in CIB (+28%)
Slide 14: Broad-based efficiency gains
12 Delivered broad-based efficiency gains with cost savings in all European countries fueled by our new operating model Note: Percentage change year-on-year in constant euros. Efficiency YoY change in euros (1) Excluding Argentina due to high inflation. Including it, South America: +4.9% Europe -3.8
Slide 15: Improved cost of credit
13 Improved cost of credit: lower LLPs in most countries, particularly in the US and Brazil (1) Provisions to cover losses due to impairment of loans in the last 12 months / average customer loans and advances of the last 12 months. Considering annualized 3M’21 provisions, cost of credit would be 0.
Slide 16: Increased profitability and TNAVps
14 2.1% 7.4% 13.0% Q1'20 2020 Q1'21 Our strong operating performance resulted in increased profitability and TNAVps… Notes: The averages for the Q1 RoTE denominators are calculated on the basis of 4 months from December to March and 2020 RoTE denominator is calculated on the basis of 13 months from
Slide 17: Solid capital position
15 …and high organic generation which enabled us to maintain our solid capital position Note: Does not include repurchase of Santander México shares, which is expected to close in Q2 or Q3’21 (1) Includes -15 bps for shareholder remuneration, equivalent to 40% of Q1’21 underlying profit (2) IFRS 9 2
Slide 18: Index
16 Index 1 Group performance Appendix 3 Business areas review Key takeaways 2 4
Slide 19: Business and profit growth across geographies
17 Business and profit growth leveraging our geographic diversification Underlying att. profit (EUR mn) Net operating income (EUR mn) 2,077 +36% 2,320 +12% 1,620 +4% 826 +338% 773 +41% 773 +205% Europe South America North America Q1’21 (vs. Q1’20) Underlying RoTE Customer deposits (EUR bn) 576 +7% 1
Slide 20: Spain
18 Spain Q1’21 profit boosted by the increase in net operating income and reduced LLPs Hefty cost reduction and productivity increase Total income flat YoY: increased NII (volumes and TLTRO), offset by reduced fee income (Q1’20 pre-pandemic) and lower ALCO sales NII QoQ performance affected by margi
Slide 21: UK
19 UK VOLUMES1KEY DATA Q1'21 vs. Q1'20 Digital customers (mn) 6.4 +7% NPL ratio (%) 1.35 +36 bps Cost of credit (%) 0.21 +7 bps Efficiency ratio (%) 58.7 -947 bps Underlying RoTE (%) 9.2 +7.7 pp P&L* Q1'21 vs. Q4'20 vs. Q1'20 NII 1,001 -1.3 23.7 Net fee income 120 20.4 -35.7 Total income 1,111 2.7 1
Slide 22: Brazil
20 Maintained our growth strategy, reflected in double-digit growth in digital customers and volumes Continued improvement of operational efficiency, reaching historic lows Profit increased YoY: revenue up (higher volumes partly offset by lower interest rates), costs control and lower LLPs. Higher R
Slide 23: United States
21 Remarkable speed of vaccination and massive fiscal stimulus support activity recovery and cost of credit improvement Significant profit increase YoY and QoQ boosted by net operating income (+13%) and LLPs reduction. Net operating income increased 19% YoY excluding Puerto Rico and Bluestem portfol
Slide 24: Mexico
22 Mexico VOLUMES1 (1) EUR bn and YoY changes in constant euros. Loans and advances to customers excluding reverse repos. Customer funds: customer deposits excluding repos + marketed mutual funds KEY DATA Q1'21 vs. Q1'20 Digital customers (mn) 5.1 +15% NPL ratio (%) 3.21 +114 bps Cost of credit (%)
Slide 25: Digital Consumer Bank
23 Ongoing execution of business digitalization. The conversion of creditors into full customers helped to maintain high profitability New lending (-3% vs. Q1’20) impacted by lockdowns in some countries (especially in January and February), although positive activity signs in March Profit up YoY fav
Slide 26: Global businesses
24 Global businesses Wealth Management & Insurance AUM’s up in Private Banking and SAM: EUR 4,700 mn net sales. Total Insurance fees up 5% YoY Total contribution to Group’s profit up 1% vs. Q1’20 pre-crisis, despite PB being affected by lower interest rates, margin compression in SAM and positive no
Slide 27: PagoNxt
25 One Trade is our global trade and international payments platform, addressing the needs of SMEs and Corporates with the latest technology Innovative payments solutions for both Santander and non-Santander clients Getnet is our merchant payments global franchise offering in-store and ecommerce acq
Slide 28: Corporate Centre
26 Q1 results impacted by higher provisions to reinforce our balance sheet Positive impact of FX hedging reflected in 2020 in Gain/Losses on FT Lower costs (-7% YoY) and reduced income tax Corporate Centre P&L* Q1'21 Q4'20 Q1'20 NII -324 -345 -304 Gains/Losses on FT -44 104 14 Operating expenses -79
Slide 29: Index
27 Index 1 Group performance Appendix 3 Business areas review Key takeaways 2 4
Slide 30: Strong business in Q1'21
28 Strong business in Q1’21 Solid P&L EUR 2.1 bn underlying attributable profit FY2021 restructuring charges recorded Revenue +8% Net operating income +15% EUR 1.6 bn attributable profit Strengthened balance sheet and improved profitability Loans: +EUR 17 bn Deposits: +EUR 65 bn CET1 above the targe
Slide 31: Near-term outlook
29 Near-term outlook Business environment 2021 outlook by business areas • We expect activity to increase as vaccination progresses, although at different speeds: • Starting in the US and the UK in H1’21 • Some remaining pressure in Europe and LatAm with improvement expected in H2’21 • Lower cost of
Slide 32: Index
30 Index 1 Group performance Appendix 3 Business areas review Key takeaways 2 4
Slide 33: Appendix contents
31 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 34: Europe
32 Europe Accelerating transformation to deliver superior growth under a more efficient operating model Revenue increase YoY driven by CIB, NII (Spain and the UK) and ALCO sales (Portugal) Strong efficiency improvement as a result of the ongoing optimization plans in all countries Cost of credit nor
Slide 35: Portugal
33 Portugal 39 44 Loans Funds VOLUMES1 (1) EUR bn and YoY changes in constant euros. Loans and advances to customers excluding reverse repos. Customer funds: customer deposits excluding repos + marketed mutual funds +20% KEY DATA Q1'21 vs. Q1'20 Digital customers (k) 970 +22% NPL ratio (%) 3.84 -72
Slide 36: Poland
34 Poland VOLUMES2KEY DATA Q1'21 vs. Q1'20 Digital customers (k) 2,812 +8% NPL ratio (%) 4.82 +53 bps Cost of credit (%) 1.02 +14 bps Efficiency ratio (%) 44.3 -274 bps Underlying RoTE (%) 5.0 -0.1 pp P&L* Q1'21 vs. Q4'20 vs. Q1'20 NII 240 -0.5 -14.7 Net fee income 127 6.5 14.4 Total income 357 -7.2
Slide 37: North America
35(1) RoTE adjusted for excess capital. Otherwise, 14% (2) Loans and advances to customers excluding reverse repos. Customer funds: customer deposits excluding repos + marketed mutual funds. EUR bn and YoY changes in constant euros, excluding disposal of Puerto Rico and Bluestem impact (EUR 3.5 bn i
Slide 38: South America
36 South America KEY DATA Q1'21 vs. Q1'20 Digital customers (mn) 21.6 +21% NPL ratio (%) 4.30 -33 bps Cost of credit (%) 2.81 -49 bps Efficiency ratio (%) 34.4 -135 bps Underlying RoTE (%) 19.3 +3.4 pp P&L* Q1'21 vs. Q4'20 vs. Q1'20 NII 2,575 -1.6 8.0 Net fee income 842 -5.3 2.4 Total income 3,539 -
Slide 39: Chile
37 We continued to make headway with our commercial strategy: demand deposits (+42%), Superdigital (140 k active customers) and launch of Getnet (c.14 k PoS) and Autocompara (leader in insurance issuance) Profit QoQ impacted by lower inflation, weak consumption associated to lockdown and increased t
Slide 40: Argentina
38 Ongoing digital transformation: strong digital customers growth, Getnet reached 21 k customers since October and launch of Cockpit QoQ profit up due to lower costs and LLPs. NII impacted by margin pressure Profit increased YoY boosted by the main lines of revenue and lower provisions. Costs refle
Slide 41: Uruguay and Andean region
39 High profitability sustained across all countries supported by stronger customer loyalty, leading to greater transactionality Uruguay: underlying profit decreased YoY impacted by lower interest rates and lower gains on financial transactions Peru: profit rose boosted by higher revenue and efficie
Slide 42: Appendix contents
40 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 43: Retail Banking
41 Focus on accelerating our digital transformation, through a multi-channel strategy adapting channels to new business trends and customer needs This clear orientation enabled us to rank top 3 in customer satisfaction, measured by NPS, in six of our markets QoQ and YoY profit growth due to higher v
Slide 44: Corporate & Investment Banking
42 SCIB continues executing its strategy to strengthen its position as a strategic advisor. The recent creation of the DSG team1 being one example of further developing its advisory expertise Profit boosted by strong revenue growth, backed by market activities, together with the positive performance
Slide 45: Wealth Management & Insurance
43 In Private Banking, continued good activity levels and business growth. Net new money YTD: EUR 3,300 million In SAM, volumes are back to speed (up +10% YoY), both by market movement and by positive net sales (EUR 1,400 million YTD) In Insurance, Gross Written Premiums +11% YoY, despite related bu
Slide 46: Appendix contents
44 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 47: Liquidity balance sheet
45 ST Funding Securitisations and others Equity and other liabilities Loans and advances to customers Financial assets Fixed assets & other Customer deposits M/LT debt issuances Note: Liquidity balance sheet for management purposes (net of trading derivatives and interbank balances) (1) Provisional
Slide 48: Debt maturity profile
46 0.4 1.0 2.2 0.9 1.8 1.7 2021 2022 2023 2024 2025 2026+ EUR 8.4 bn1 issued in public markets in Q1’21 EUR bn, Mar-21 Very manageable maturity profile EUR bn, Mar-21 2021 2022 2023 2024 2025 2026+ Spain2 UK SCF Other 2.1 9.1 8.1 7.4 8.5 48.4 3.7 6.2 2.5 3.9 2.6 1.5 2021 2022 2023 2024 2025 2026+ 10
Slide 49: ALCO portfolios and interest rate sensitivity
47(1) Parent bank (2) Ring-fenced bank (3) SBNA. SC USA has positive sensitivity under a -100 bp shift scenario * Note: different criteria vs. Q4’20 presentation: -100 bps sensitivities affected by removal of management floors ALCO portfolios reflect our geographic diversificationMostly positive int
Slide 50: 2021 funding plan and issuances
48 2021 Funding plan and issuances EUR bn, Mar-21 Issuances YTD against funding plan • The Financial Plan is focused on covering TLAC/MREL requirements, with no secured issuances, to: – continue building up TLAC/MREL buffers. – pre-finance senior non-preferred / senior preferred transactions which l
Slide 51: Capital requirements
49 4.50% 12.30% 0.84% 2.50% 1.00% CCyB, 0.01% 1.781% 1.60% 2.38% 2.26% 13.01% 16.16% Regulatory Requirement 2020 Group ratios Mar-21 4.50% 11.89% 11-12% 0.84% 2.50% 1.00% CCyB, 0.01% 1.78% 1.55% 1.50% 2.38% 2.37% 2.00%13.01% 15.81% >14.5 Assumed regulatory requirement 2020 Group ratios Mar-21 Medium
Slide 52: TLAC ratios
50 TLAC ratios for the Resolution Group headed by Banco Santander, S.A. TLAC Ratio December 20 figures show the Closing data, not the estimates shown in the fourth quarter earnings presentation • TLAC ratio increased in the first quarter of 2021 by 0.9% to 24.8% (compared with the fully-loaded TLAC
Slide 53: Appendix contents
51 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 54: Yield on loans
52 Yield on loans (%) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Europe 2.30 2.12 2.06 2.09 2.08 Spain 1.99 1.86 1.82 1.85 1.85 United Kingdom 2.49 2.35 2.32 2.36 2.33 Portugal 1.63 1.57 1.57 1.51 1.46 Poland 4.04 3.34 2.95 2.89 2.91 North America 8.94 7.85 7.82 7.70 7.78 US 7.76 6.90 6.96 6.83 7.00 Mexico 12.25
Slide 55: Cost of deposits
53 Cost of deposits (%) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Europe 0.36 0.25 0.14 0.12 0.11 Spain 0.06 0.04 0.04 0.04 0.04 United Kingdom 0.69 0.52 0.29 0.23 0.21 Portugal 0.08 0.06 0.05 0.03 0.02 Poland 0.65 0.42 0.14 0.09 0.05 North America 1.57 1.15 0.90 0.74 0.64 US 0.74 0.40 0.30 0.23 0.17 Mexico 3.5
Slide 56: Appendix contents
54 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 57: Loans subject to moratoria
55 78% 98% 69% 15 5 1 9 1 1 Total SMEs & Corporates Consumer Mortgages Europe South America North America 86% of moratoria has expired, with only 5% in stage 3. From the 14% still active, 73% is secured and most of it is in Europe Distribution of loans subject to moratoria Active moratoria as of 31s
Slide 58: Breakdown of moratoria
56 Europe 75 11% 60 80% 80% 16% 4% UK 45 19% 44 96% 80% 17% 3% Spain 11 6% 5 46% 74% 16% 10% SCF 4 4% 4 97% 86% 10% 4% North America 20 16% 20 98% 50% 42% 9% USA (SBNA & SC) 14 17% 13 97% 34% 55% 11% Mexico 6 21% 6 99% 81% 15% 5% South America 17 14% 16 97% 86% 9% 5% Brazil 5 8% 5 94% 72% 19% 9% EUR
Slide 59: Stage coverage
57 Stage coverage (1) Exposure subject to impairment in EUR bn. Additionally, customer loans not subject to impairment recorded at mark to market with changes through P&L (EUR 27 bn in March 21, EUR 25 bn in December 2020, EUR 29 bn in September 2020, EUR 35 bn in June 2020 and EUR 31 bn in March 20
Slide 60: NPL ratio
58 NPL ratio (%) Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Europe 3.37 3.41 3.29 3.34 3.26 Spain 6.88 6.55 5.98 6.23 6.18 United Kingdom 0.99 1.10 1.33 1.24 1.35 Portugal 4.56 4.43 4.25 3.89 3.84 Poland 4.29 4.57 4.58 4.74 4.82 North America 2.02 1.73 1.96 2.23 2.39 US 2.00 1.49 1.85 2.04 2.11 Mexico 2.07
Slide 61: Coverage ratio
59 Coverage ratio (%) Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Europe 47.0 46.5 48.7 50.3 50.0 Spain 44.6 43.3 46.0 47.1 47.2 United Kingdom 39.7 42.8 41.6 44.7 40.5 Portugal 59.0 60.9 64.3 66.5 69.2 Poland 68.1 69.0 70.8 70.7 70.3 North America 170.1 206.5 201.6 182.6 153.4 US 181.4 253.1 228.8 210.4 183
Slide 62: Credit impaired loans and loan-loss allowances
60 Credit impaired loans and loan-loss allowances. Breakdown by operating areas. March 2021 Spain, 27.0% UK, 6.1% Portugal, 4.6% Poland, 4.6% Other Europe, 1.1% USA, 16.4% Mexico, 4.4% Brazil, 16.2% Chile, 5.7% Argentina, 1.0% Other South America, 0.7% DCB, 12.2% Spain, 42.4% UK, 11.2%Portugal, 4.9%
Slide 63: Cost of credit
61 Cost of credit (%) Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Europe 0.36 0.41 0.48 0.58 0.51 Spain 0.64 0.68 0.80 1.01 0.91 United Kingdom 0.14 0.22 0.26 0.27 0.21 Portugal 0.23 0.30 0.42 0.51 0.38 Poland 0.88 0.96 0.99 1.10 1.02 North America 3.02 3.21 3.07 2.92 2.34 US 3.13 3.30 3.08 2.86 2.12 Mexico
Slide 64: Appendix contents
62 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 65: Santander Responsible Banking goals
63 Santander Responsible Banking goals We are building a more Responsible Bank aligned with our commitments 2018 2021 202520202019 Top 10 company to work for1 Women on the board of directors Women in senior leadership positions2 Equal pay gap3 Financially empowered people4 Green finance raised and f
Slide 66: Appendix contents
64 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 67: Santander Group (EUR mn)
65 SANTANDER GROUP (EUR mn) (*) Including: in Q1’20, restructuring costs in Q2’20, adjustment to the valuation of goodwill, adjustment has been made to deferred tax assets of the Spanish consolidated fiscal group and restructuring costs and other in Q4’20, restructuring costs and other in Q1’21, res
Slide 68: Santander Group (Constant EUR mn)
66 SANTANDER GROUP (Constant EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 7,567 7,411 7,748 8,093 7,956 Net fee income 2,543 2,208 2,399 2,460 2,548 Gains (losses) on financial transactions and other 455 647 882 513 886 Total income 10,565 10,266 11,030 11,066 11,390 Operating expenses
Slide 69: Europe (EUR mn)
67 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,378 2,330 2,534 2,670 2,645 Net fee income 1,128 942 961 968 1,072 Gains (losses) on financial transactions and other 212 125 388 37 432 Total income 3,718 3,398 3,883 3,675 4,149 Operating expenses (2,175) (2,038) (2,046) (2,015) (2,071) Net op
Slide 70: Europe (Constant EUR mn)
68 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,350 2,337 2,558 2,699 2,645 Net fee income 1,117 942 963 970 1,072 Gains (losses) on financial transactions and other 213 122 387 36 432 Total income 3,680 3,402 3,909 3,704 4,149 Operating expenses (2,154) (2,044) (2,065) (2,034) (2,071) Net op
Slide 71: Spain (EUR mn)
69 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 925 931 1,034 1,067 1,019 Net fee income 643 535 562 573 587 Gains (losses) on financial transactions and other 220 96 204 (8) 178 Total income 1,789 1,562 1,800 1,632 1,785 Operating expenses (944) (896) (893) (873) (867) Net operating income 844
Slide 72: United Kingdom (EUR mn)
70 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 820 796 905 983 1,001 Net fee income 190 94 115 96 120 Gains (losses) on financial transactions and other (3) 1 14 (31) (10) Total income 1,007 891 1,034 1,048 1,111 Operating expenses (686) (631) (620) (601) (652) Net operating income 321 259 414
Slide 73: United Kingdom (GBP mn)
71 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 706 706 818 885 874 Net fee income 163 85 104 87 105 Gains (losses) on financial transactions and other (2) 1 13 (27) (8) Total income 867 791 934 945 971 Operating expenses (591) (560) (562) (543) (569) Net operating income 276 231 372 402 401 Ne
Slide 74: Portugal (EUR mn)
72 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 202 197 193 195 193 Net fee income 101 90 94 103 99 Gains (losses) on financial transactions and other 47 30 25 19 135 Total income 350 317 312 317 427 Operating expenses (151) (145) (146) (149) (146) Net operating income 199 172 166 168 281 Net l
Slide 75: Poland (EUR mn)
73 Poland (EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 296 251 246 243 240 Net fee income 116 104 112 120 127 Gains (losses) on financial transactions and other (48) 23 35 24 (10) Total income 365 377 394 388 357 Operating expenses (172) (143) (161) (154) (158) Net operating income 193
Slide 76: Poland (PLN mn)
74 Poland (PLN mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 1,279 1,134 1,095 1,096 1,090 Net fee income 503 467 498 541 576 Gains (losses) on financial transactions and other (206) 95 156 109 (46) Total income 1,576 1,696 1,749 1,746 1,621 Operating expenses (742) (645) (714) (694) (718) N
Slide 77: Other Europe (EUR mn)
75 Other Europe (EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 134 155 155 182 192 Net fee income 78 120 78 75 138 Gains (losses) on financial transactions and other (5) (24) 109 32 139 Total income 207 251 343 290 469 Operating expenses (222) (223) (226) (238) (249) Net operating income
Slide 78: Other Europe (Constant EUR mn)
76 Other Europe (Constant EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 133 151 155 182 192 Net fee income 75 118 78 75 138 Gains (losses) on financial transactions and other (6) (25) 109 32 139 Total income 202 244 342 289 469 Operating expenses (218) (219) (225) (237) (249) Net operati
Slide 79: North America (EUR mn)
77 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,261 2,079 2,076 2,055 2,005 Net fee income 464 405 413 402 451 Gains (losses) on financial transactions and other 216 227 194 242 313 Total income 2,941 2,711 2,683 2,699 2,768 Operating expenses (1,230) (1,123) (1,109) (1,215) (1,149) Net opera
Slide 80: North America (Constant EUR mn)
78 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,052 1,988 2,071 2,042 2,005 Net fee income 421 394 417 400 451 Gains (losses) on financial transactions and other 198 211 190 237 313 Total income 2,670 2,592 2,678 2,679 2,768 Operating expenses (1,117) (1,073) (1,109) (1,205) (1,149) Net opera
Slide 81: United States (EUR mn)
79 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 1,462 1,429 1,406 1,348 1,337 Net fee income 250 215 218 206 241 Gains (losses) on financial transactions and other 217 157 206 247 324 Total income 1,929 1,801 1,830 1,801 1,902 Operating expenses (809) (776) (722) (772) (748) Net operating incom
Slide 82: United States (USD mn)
80 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 1,612 1,573 1,644 1,608 1,611 Net fee income 275 237 255 247 290 Gains (losses) on financial transactions and other 239 173 240 291 390 Total income 2,126 1,983 2,139 2,145 2,290 Operating expenses (892) (855) (846) (918) (901) Net operating incom
Slide 83: Mexico (EUR mn)
81 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 798 650 669 707 667 Net fee income 211 185 189 188 204 Gains (losses) on financial transactions and other (2) 70 (10) (4) (6) Total income 1,007 905 848 891 865 Operating expenses (415) (341) (375) (422) (373) Net operating income 592 565 473 469
Slide 84: Mexico (MXN mn)
82 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 17,484 16,706 17,310 17,322 16,360 Net fee income 4,617 4,719 4,868 4,596 4,995 Gains (losses) on financial transactions and other (51) 1,658 (194) (91) (156) Total income 22,049 23,083 21,984 21,827 21,199 Operating expenses (9,088) (8,749) (9,65
Slide 85: Other North America (EUR mn)
83 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income (0) 0 0 0 0 Net fee income 4 5 7 8 7 Gains (losses) on financial transactions and other 2 (1) (2) (0) (5) Total income 5 4 6 8 2 Operating expenses (6) (6) (13) (22) (28) Net operating income (0) (2) (7) (14) (26) Net loan-loss provisions (0) (0)
Slide 86: Other North America (Constant EUR mn)
84 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income (0) 0 0 0 0 Net fee income 4 5 7 8 7 Gains (losses) on financial transactions and other 2 (1) (2) (0) (5) Total income 5 4 6 8 2 Operating expenses (6) (6) (13) (22) (28) Net operating income (0) (2) (7) (14) (26) Net loan-loss provisions (0) (0)
Slide 87: South America (EUR mn)
85 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 3,065 2,606 2,486 2,566 2,575 Net fee income 1,077 779 848 885 842 Gains (losses) on financial transactions and other 26 310 149 70 122 Total income 4,169 3,695 3,483 3,522 3,539 Operating expenses (1,492) (1,281) (1,250) (1,335) (1,219) Net opera
Slide 88: South America (Constant EUR mn)
86 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,384 2,375 2,434 2,615 2,575 Net fee income 822 714 818 889 842 Gains (losses) on financial transactions and other 25 271 145 69 122 Total income 3,231 3,360 3,397 3,573 3,539 Operating expenses (1,161) (1,170) (1,227) (1,365) (1,219) Net operati
Slide 89: Brazil (EUR mn)
87 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 2,270 1,813 1,756 1,786 1,780 Net fee income 869 614 664 677 632 Gains (losses) on financial transactions and other (3) 224 114 82 109 Total income 3,137 2,651 2,534 2,544 2,521 Operating expenses (1,004) (835) (805) (897) (723) Net operating inco
Slide 90: Brazil (BRL mn)
88 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 11,100 10,725 11,066 11,446 11,744 Net fee income 4,250 3,679 4,167 4,324 4,169 Gains (losses) on financial transactions and other (14) 1,196 703 538 718 Total income 15,336 15,600 15,935 16,308 16,632 Operating expenses (4,907) (4,922) (5,065) (5
Slide 91: Chile (EUR mn)
89 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 448 425 420 494 497 Net fee income 92 74 74 94 95 Gains (losses) on financial transactions and other 12 85 38 6 22 Total income 553 584 532 594 614 Operating expenses (230) (228) (223) (219) (236) Net operating income 322 356 310 375 378 Net loan-
Slide 92: Chile (CLP mn)
90 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 397,015 384,057 383,394 447,669 433,780 Net fee income 81,770 67,170 67,421 85,452 82,698 Gains (losses) on financial transactions and other 10,853 76,628 35,003 5,316 19,479 Total income 489,638 527,855 485,818 538,437 535,956 Operating expenses
Slide 93: Argentina (EUR mn)
91 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 241 261 218 192 204 Net fee income 76 56 70 71 74 Gains (losses) on financial transactions and other 1 (8) (14) (36) (16) Total income 318 310 274 226 262 Operating expenses (186) (153) (152) (141) (171) Net operating income 132 157 122 85 92 Net
Slide 94: Argentina (ARS mn)
92 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 16,991 22,846 24,646 29,613 22,035 Net fee income 5,327 5,132 7,611 10,109 7,977 Gains (losses) on financial transactions and other 89 (595) (1,349) (4,047) (1,686) Total income 22,407 27,384 30,908 35,674 28,326 Operating expenses (13,112) (13,75
Slide 95: Other South America (EUR mn)
93 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 106 107 91 94 93 Net fee income 40 34 40 43 41 Gains (losses) on financial transactions and other 16 9 11 19 7 Total income 162 149 143 157 141 Operating expenses (72) (65) (70) (78) (90) Net operating income 90 85 73 79 51 Net loan-loss provision
Slide 96: Other South America (Constant EUR mn)
94 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 89 97 89 93 93 Net fee income 35 32 39 42 41 Gains (losses) on financial transactions and other 14 8 10 19 7 Total income 138 136 138 154 141 Operating expenses (62) (60) (68) (77) (90) Net operating income 76 76 70 77 51 Net loan-loss provisions
Slide 97: Digital Consumer Bank (EUR mn)
95 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 1,088 1,054 1,048 1,073 1,056 Net fee income 192 163 211 205 188 Gains (losses) on financial transactions and other 11 (4) 50 74 59 Total income 1,291 1,214 1,309 1,352 1,304 Operating expenses (596) (552) (585) (596) (600) Net operating income 69
Slide 98: Digital Consumer Bank (Constant EUR mn)
96 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 1,085 1,065 1,056 1,082 1,056 Net fee income 192 164 211 205 188 Gains (losses) on financial transactions and other 11 (4) 50 75 59 Total income 1,287 1,225 1,317 1,362 1,304 Operating expenses (594) (557) (588) (600) (600) Net operating income 69
Slide 99: Corporate Centre (EUR mn)
97 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income (304) (354) (371) (345) (324) Net fee income (9) (6) (11) (3) (5) Gains (losses) on financial transactions and other 9 47 110 96 (41) Total income (304) (313) (271) (252) (370) Operating expenses (85) (82) (82) (80) (79) Net operating income (389)
Slide 100: Retail Banking (EUR mn)
98 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 8,004 7,272 7,280 7,500 7,472 Net fee income 2,058 1,536 1,707 1,685 1,709 Gains (losses) on financial transactions and other 108 263 444 165 355 Total income 10,171 9,071 9,431 9,349 9,536 Operating expenses (4,632) (4,191) (4,183) (4,280) (4,157
Slide 101: Retail Banking (Constant EUR mn)
99 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 7,166 7,003 7,263 7,563 7,472 Net fee income 1,824 1,484 1,691 1,688 1,709 Gains (losses) on financial transactions and other 137 235 426 141 355 Total income 9,127 8,723 9,380 9,392 9,536 Operating expenses (4,233) (4,063) (4,183) (4,320) (4,157)
Slide 102: Corporate & Investment Banking (EUR mn)
100 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 677 705 771 765 720 Net fee income 402 405 360 375 466 Gains (losses) on financial transactions and other 217 300 242 113 469 Total income 1,297 1,410 1,373 1,253 1,655 Operating expenses (528) (499) (488) (523) (526) Net operating income 769 910
Slide 103: Corporate & Investment Banking (Constant EUR mn)
101 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 605 673 764 775 720 Net fee income 364 393 355 379 466 Gains (losses) on financial transactions and other 181 270 251 129 469 Total income 1,150 1,337 1,370 1,282 1,655 Operating expenses (488) (486) (488) (526) (526) Net operating income 662 851
Slide 104: Wealth Management & Insurance (EUR mn)
102 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 109 93 92 100 88 Net fee income 308 269 279 296 297 Gains (losses) on financial transactions and other 133 99 102 149 117 Total income 550 462 474 545 502 Operating expenses (237) (212) (207) (216) (220) Net operating income 313 250 266 329 281 N
Slide 105: Wealth Management & Insurance (Constant EUR mn)
103 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 99 88 92 101 88 Net fee income 290 263 277 296 297 Gains (losses) on financial transactions and other 121 98 102 149 117 Total income 511 449 472 546 502 Operating expenses (222) (206) (207) (216) (220) Net operating income 289 243 265 330 281 Ne
Slide 106: PagoNxt (EUR mn)
104 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 0 (1) 0 (0) (1) Net fee income 94 78 88 103 81 Gains (losses) on financial transactions and other 7 (3) (8) (2) (14) Total income 101 75 81 100 67 Operating expenses (95) (92) (113) (142) (136) Net operating income 5 (18) (33) (42) (69) Net loan-
Slide 107: PagoNxt (Constant EUR mn)
105 PagoNxt (Constant EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 0 (0) 0 (0) (1) Net fee income 74 73 87 101 81 Gains (losses) on financial transactions and other 7 (3) (7) (2) (14) Total income 81 71 80 99 67 Operating expenses (83) (88) (111) (141) (136) Net operating income (2) (17
Slide 108: Appendix contents
106 Primary segments and other countries Secondary segments Balance sheet and capital management Yield on loans and cost of deposits NPL and coverage ratios and cost of credit Responsible Banking Quarterly income statements Glossary Appendix
Slide 109: Glossary - Acronyms
107 Glossary - Acronyms ❑ AuM: Assets under Management ❑ BFG: Deposit Guarantee Fund in Poland ❑ bn: Billion ❑ CET1: Common equity tier 1 ❑ C&I: Commercial and Industrial ❑ CIB: Corporate & Investment Bank ❑ covid-19: Coronavirus Disease 19 ❑ DGF: Deposit guarantee fund ❑ GDP: Gross domestic product
Slide 110: Notes and definitions of profitability and efficiency measures
108 Notes: 1) The averages for the RoTE and RoRWA denominators are calculated on the basis of 4 months from December to March. 2) For periods of less than a year, and in the event of non-recurring results existing, the profit used to calculate the RoTE is the annualised underlying attributable profi
Slide 111: 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:
Slide 112: Signature
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Banco Santander, S.A. Date: 28 April 2021 By: /s/ José García Cantera Name: José García Cantera Title: C