Banco Santander, S.a. · BME:SAN
Banco Santander — FY2020 Earnings Presentation
127 slides from Banco Santander's earnings presentation, Feb 3, 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 February, 2021 Commission File Number: 001-12518 Banco Santander, S.A. (Exact name of registrant as specified in its c
Slide 2: Table of contents
BANCO SANTANDER, S.A. ________________________ TABLE OF CONTENTS Item 1. January - December 2020 Earnings presentation
Slide 3: All. Together. Now. 2020 Earnings Presentation
All. Together. Now. 2020 Earnings Presentation 3 February 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 3 Medium term outlook and key takeaways 1 Performance in 2020 and areas review 2 Progress on transformation in 2020 and next steps Index
Slide 7: 2020 key results highlights
5 ProfitabilityGrowth Strength 22.8mn (+6%) Loyal customers Customer revenues €42bn (0%1) 12.34% (+69 bps) CET12 1.28% (+28 bps) Cost of credit3 47% (-3 bps) Efficiency ratio Net operating income €23.6bn (+2%1) 2020 (vs. 2019) Fully-paid capital distribution of new shares equivalent to €0.10 per sha
Slide 8: 2020 income statement summary
6 EUR mn 2020 2019 % change Euros Constant Euros Net interest income 31,994 35,283 -9 1 Net fee income 10,015 11,779 -15 -5 Customer revenue 42,009 47,062 -11 0 Trading and other income 2,591 2,432 7 9 Total income 44,600 49,494 -10 0 Operating expenses -20,967 -23,280 -10 -2 Net operating income 23
Slide 9: Geographical and business diversification
7 2020 (vs. 2019) Contribution to Group’s underlying profit1 YoY changes in constant euros Global Businesses included in Europe, North America, and South America. Digital Consumer Bank included in Europe’s perimeter. (1) Underlying profit contribution excludes Corporate Centre (€-1,844mn) and Santan
Slide 10: Covid-19 support for customers, communities and employees
8 >€100mn in aid €56mn for essential health equipment and materials €19mn to support vulnerable communities €30mn through Santander Universities CommunitiesCustomers c.6mn customers supported during Covid19 c.€175bn in new loans >€1bn per day in new lending for SMEs and Corporates c.80% expired mora
Slide 11: Embedding ESG to build a more responsible bank
9 (1) Top 10 company to work for (2) People financially empowered through Santander initiatives (3) Collective Commitment to Climate Action (4) Task Force on Financial Climate Disclosure Note: Unaudited data … further embedding ESG to build a more responsible bank Going green ourselves Environmental
Slide 12: Group review
10 Group review
Slide 13: Resilient revenue and net operating income
11 2020 showed resilient revenue and net operating income1… Growth 1,686 1,798 1,886 1,837 248 1,524 1,802 1,508 Q1'19 Q2 Q3 Q4 Q1'20 Q2 Q3 Q4 Constant EUR mn Underlying attributable profit Q4 includes DGF & Bank Levy (€250 mn after tax) Attributable profit (Constant EUR mn) 1,498 1,095 280 2,377 20
Slide 14: Investing to improve operating model and productivity
12 … while investing to improve our operating model and productivity Note: Data in EUR mn (1) Poland, Portugal, SCF, SCIB branches and digital FY2020 Restructuring costs -1,114 Others -138 Group total -13,852 → Other -1,146 Restructuring costs -1,039 (Spain -700, the UK -121, Others1 -218) Others -1
Slide 15: Top line recovery in the last two quarters
13 Top line showed strong signs of recovery in the last two quarters Growth Constant EUR mn Net operating income 5,226 5,306 5,345 5,509 5,249 5,061 5,212 5,444 Q1'19 Q2 Q3 Q4 Q1'20 Q2 Q3 Q4 Net interest income Net fee income Costs Constant EUR mn. Changes vs. Q3’20 Revenues and costs 457 465 695 75
Slide 16: NII and fees recovery in Q4
14 NII and fees continued to recover in Q4… NII increased from higher lending and deposits volumes NII evolution Constant EUR mn 31,994 -1,240 -516 31,590 +1,902 +257 2019 Volumes Rates Regulatory impacts Other 2020 Retail Banking WM&I 2020 vs. 2019 54% 31% 15% SCIB Net fee income - breakdown by Glo
Slide 17: Efficiency gains exceeded 2020 target
15 … and efficiency gains exceeded 2020 target Profitability Increasing productivity in most markets (1) Excluding Argentina, otherwise +4.0% (2) Proforma Europe South America1 North America -5.8% 1.5% -1.7% -10% -5% -6% -5% +5% +1% 0% Group -2.0% -2% -6% Digital Consumer Bank2 -0.4% Costs % change
Slide 18: Cost of credit in line with guidance
16 Cost of credit in line with guidance, with improved coverage Strength Loan-loss provisions Constant EUR bn +47% YoY 12.2 3.6 3.1 2.7 2.8 Q1'20 Q2 Q3 Q4 2020 Credit quality indicators Dec-19 Cost of credit1 1.00% 1.28% NPL ratio 3.32% 3.21% Coverage ratio 68% 76% Dec-20 Note: Exposure and coverage
Slide 19: Moratoria expiry and credit quality
17 19 4 1 14 2 1 0 2 1 1 Total SMEs & Corporates Consumer Mortgages Europe South America North America 79% of moratoria have already expired with 3% in stage 3. 78% of the €23bn active moratoria are secured Strength Note: Data aligned with EBA disclosure template Active moratoria by segment Active m
Slide 20: Group CET1 evolution
18 Group CET1 rose 69 bps YoY, exceeding our 11%-12% target Strength CET1 ratio evolution 12.34 -0.43 -0.14 -0.09 11.65 +1.04 +0.02 +0.29 Dec-19 Organic generation Regulatory & Models One-offs & corp transactions Markets & others No complementary dividend 2019 Dividend accrual 2020 Dec-20 +69 bps
Slide 21: Business areas review
19 Business areas review
Slide 22: Europe
20 EUROPE KEY DATA 2020 % 2019 Loyal / active customers (%) 36 +1 pp Digital customers (mn) 15.2 +10% NPL ratio (%) 3.15 -10 bps Cost of credit (%) 0.62 +34 bps Efficiency ratio (%) 52.4 -21 bps Underlying RoTE (%) 5.5 -4.5 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 3,710 4.6 14,046 0.0 Net fee income 1,
Slide 23: Spain
21 Spain VOLUMES1 Customer loans (EUR bn) Customer deposits (EUR bn) KEY DATA 2020 % 2019 Loyal / active customers (%) 34 +2 pp Digital customers (mn) 5.2 +11% NPL ratio (%) 6.23 -71 bps Cost of credit (%) 1.01 +58 bps Efficiency ratio (%) 53.2 -38 bps Underlying RoTE (%) 3.3 -7.2 pp P&L* Q4'20 % Q3
Slide 24: UK
22 UK Europe main markets VOLUMES1 Volume growth based on strong new mortgage lending (GBP+4 bn YoY) and business banking government schemes Recovery picked up in Q4 reflected in revenue growth (liability repricing), cost control and lower LLPs FY20 profit down due to regulatory changes (overdrafts)
Slide 25: North America
23 NORTH AMERICA KEY DATA 2020 % 2019 Loyal / active customers (%) 36 +6 pp Digital customers (mn) 6.0 +16% NPL ratio (%) 2.23 +3 bps Cost of credit (%) 2.92 +16 bps Efficiency ratio (%) 42.1 -75 bps Underlying RoTE (%) 10.7 -2.3 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 2,055 -1.5 8,469 0.2 Net fee inc
Slide 26: South America
24 SOUTH AMERICA KEY DATA 2020 % 2019 Loyal / active customers (%) 27 +0 pp Digital customers (mn) 20.2 +17% NPL ratio (%) 4.39 -47 bps Cost of credit (%) 3.32 +40 bps Efficiency ratio (%) 35.8 -34 bps Underlying RoTE (%) 18.1 -2.5 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 2,566 7.1 10,723 4.6 Net fee i
Slide 27: Brazil
25 Brazil South America main market (1) Constant euros. Customer loans excluding reverse repos. Customer deposits excluding repos VOLUMES1 KEY DATA 2020 % 2019 Loyal / active customers (%) 23 +1 pp Digital customers (mn) 15.6 +16% NPL ratio (%) 4.59 -73 bps Cost of credit (%) 4.35 +42 bps Efficiency
Slide 28: Global Businesses
26 GLOBAL BUSINESSES Underlying RoRWA 1.86% (+6 bps YoY) Efficiency 38.3% (-5.3 pp YoY) Increased activity, improving efficiency ratio and profitability FY20 profit was 23% higher, backed by double-digit growth in all core businesses Corporate & Investment Banking Wealth Management & Insurance FY20
Slide 29: Index
27 3 Medium term outlook and key takeaways 1 Performance in 2020 and areas review 2 Progress on transformation in 2020 and next steps Index
Slide 30: Our purpose and aim
28 Our purpose To help people and businesses prosper Our aim To be the best open financial services platform, by acting responsibly and earning the lasting loyalty of our people, customers, shareholders and communities Our how Everything we do should be Simple, Personal and Fair We have laid the fou
Slide 31: Strategy and model transformation doubled profits
29(1) 2013 Statutory attributable profit to the Group re-expressed as reported in the 2014 financial report. (2) FL CET1 (€bn) accumulated since the end of 2013; 2019 including January 2015 ABB (€7.5bn) €4.2 €8.3 Underlying attributable profit to the Group, (bn) +€4.1 20192013 Change (%) 7.7% 11.8%U
Slide 32: Disciplined capital allocation
30 We will continue to allocate capital to higher growth opportunities Disciplined capital allocation High RoRWA organic growth Primarily in Americas Fee income businesses SCIB, Wealth Management, Payments Software Santander of Tomorrow One Santander, PagoNxt and Digital Consumer Bank 321 EPS + TNAV
Slide 33: Reinvesting for profitable growth
31 Reinvesting for profitable growth High RoRWA organic growth Primarily in the Americas Fee income businesses SCIB, Wealth Management, Payments Software 2 1 SCIB WM&I South America North America 2020 underlying RoRWA (Dif. vs Group avg.) RWAs as % of total Group 18% 2% 20% 18% 1.86% +80bps 7.52% +6
Slide 34: Three priorities for profitable growth
32 ONE SANTANDER New operating model leveraging our global scale to deliver a better customer experience, supported by common culture and higher degrees of commonality, technology being one 1 3 DIGITAL CONSUMER BANK Openbank and SCF driving profitable growth in Europe and new markets 2 PAGONXTOur Gr
Slide 35: One Santander operating model
33 Improving our customer service… Simplify mass market value proposition Medium term goal: Top 3 NPS in 9 countries New distribution model … strengthening our relationship with customers… Medium term goal: Digital sales/total >50% Shared processes and best-in-class technology Medium term goal: Effi
Slide 36: Medium-term goals by region
34 (1) Excluding SCF+Openbank, which would have an efficiency ratio of c.39% and a RoTE of 13%-15%. Europe, including SCF+Openbank, would have an efficiency ratio of c.43% and a RoTE of 12%-13%. (2) Adjusted RoTE for excess capital in the US Underlying RoTE: 19-21% Efficiency ratio: c.35% Underlying
Slide 37: PagoNxt global payments company
35(1) As of 2019 PagoNxt 1 32PagoNxt is our global payments company providing services to SME/ Merchant and Consumers, leveraging our scale and technology Payments is a sizeable and fast growth market… … in which Santander already has significant scale +3% Annual growth international trade €350bn In
Slide 38: PagoNxt Merchant and Trade Solutions
36 PagoNxt 1 32 Merchant Solutions Trade Solutions Merchant Spain We have already onboarded c.300k customers We have made significant investments in 4 key assets which strengthen our trade offering ‘1 8 -’ 2 0 g ro w th Active customers Market share +88% From 69k to 130k +76% From 506k to 891k +40%
Slide 39: Digital Consumer Bank foundation
37 Openbank A Global consumer financing business serving offline and e-commerce merchants Santander Auto Auto loan and leasing business serving OEMs and dealers 6mn new consumers/yr in 15 markets Digital Banking APIs (SaaS model) Openbank technology and data capabilities grow revenues by adding serv
Slide 40: Digital Consumer Bank ambition
38 Digital Consumer Bank 1 32 (1) Underlying Great potential… … to build a new paradigm… … and deliver strong financial results Active customers c.18mn Avg. products per customer 4.5 Common apps, data and systems infrastructure across regions Single streamlined operating model across auto, consu
Slide 41: Digital Consumer Bank flywheel
39 Already working Being developed Online Checkout Merchants Digital Banking API’s Openbank Current Accounts +Simpler Products Data & Growth Digital Consumers Merchants offering SAN solutions to consumers… … who can become customers of the bank More merchants offering our services (through APIs) Dev
Slide 42: Index
40 3 Medium term outlook and key takeaways 1 Performance in 2020 and areas review 2 Progress on transformation in 2020 and next steps Index
Slide 43: Our 2021 goals
41 Underlying RoTE 13-15% 11-12% CET1 40-50% cash dividend pay-out (underlying profit)3 Our 2021 goals… Reiterate our medium-term goals and a goal of 9-10% RoTE4 for 2021 … allow us to reiterate our medium-term goals2 (1) Constant euros (2) April 2019 Investor Day (3) The board’s intention is to res
Slide 44: Clear strategic priorities and plan for growth
42(1) Data applying the IFRS 9 transitional arrangements (2) Subject to necessary approvals Clear strategic priorities and plan for growth in EPS + TNAVps Our resilient business model delivered sound results in 2020 • €5bn underlying profit and resilient net operating income (+2% YoY) while growing
Slide 45: Thank You
Our purpose is to help people and businesses prosper. Our culture is based on believing that everything we do should be: Thank You.
Slide 46: Appendix
44 Appendix
Slide 47: Appendix index
45 Other countries. Detail 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 48: Santander Consumer Finance
46 SCFSCF Europe main markets VOLUMES1 KEY DATA 2020 % 2019 Active customers (mn) 17.6 -9% NPL ratio (%) 2.36 +6 bps Cost of credit (%) 0.88 +40 bps Efficiency ratio (%) 42.3 -99 bps Underlying RoTE (%) 12.5 -2.7 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 961 1.8 3,832 1.2 Net fee income 199 -2.8 750 -8.
Slide 49: Portugal
47 Portugal Europe other markets KEY DATA 2020 % 2019 Loyal / active customers (%) 48 +2 pp Digital customers (k) 930 +20% NPL ratio (%) 3.89 -94 bps Cost of credit (%) 0.51 +53 bps Efficiency ratio (%) 45.5 +21 bps Underlying RoTE (%) 8.7 -4.1 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 195 1.1 787 -8.1
Slide 50: Poland
48 Poland P&L* Q4'20 % Q3'20 2020 % 2019 NII 243 0.2 1,037 -8.5 Net fee income 120 8.5 452 0.2 Total income 388 -0.2 1,524 -8.3 Operating expenses -154 -2.8 -629 -6.2 Net operating income 234 1.6 895 -9.7 LLPs -81 24.7 -330 57.3 Underlying PBT 66 -50.3 370 -43.9 Underlying att. profit 20 -69.2 162 -
Slide 51: USA
49 USA North America (1) Excluding Puerto Rico disposal impact. Considering it, 0% YoY (2) Underlying RoTE adjusted for excess capital. Otherwise 5% (3) Constant euros. Customer loans excluding reverse repos. Customer deposits excluding repos. In Q3, disposal of Puerto Rico impact of: EUR 2.2 bn in
Slide 52: Mexico
50 Mexico North America VOLUMES1 KEY DATA 2020 % 2019 Loyal / active customers (%) 39 +6 pp Digital customers (mn) 5.0 +20% NPL ratio (%) 2.81 +62 bps Cost of credit (%) 3.03 +54 bps Efficiency ratio (%) 42.5 +72 bps Underlying RoTE (%) 14.4 -6.2 pp P&L* Q4'20 % Q3'20 2020 % 2019 NII 707 0.1 2,825 1
Slide 53: Chile
51 Chile South America other markets VOLUMES1 KEY DATA 2020 % 2019 Loyal / active customers (%) 44 -2 pp Digital customers (k) 1,547 +24% NPL ratio (%) 4.79 +15 bps Cost of credit (%) 1.50 +42 bps Efficiency ratio (%) 39.8 -83 bps Underlying RoTE (%) 13.2 -4.9 pp 38 40 41 42 41 D-19 M-20 J S D 26 29
Slide 54: Argentina
52 Argentina South America other markets VOLUMES1 KEY DATA 2020 % 2019 Loyal / active customers (%) 44 -3 pp Digital customers (k) 2,650 +21% NPL ratio (%) 2.11 -128 bps Cost of credit (%) 5.93 +84 bps Efficiency ratio (%) 56.0 -187 bps Underlying RoTE (%) 26.2 +4.0 pp P&L* Q4'20 % Q3'20 2020 % 2019
Slide 55: Uruguay and Andean region
53 Uruguay and Andean region 28% Underlying RoTE Note: Underlying attributable profit in constant EUR mn PERU +8% URUGUAY COLOMBIA South America other markets Double-digit volume growth in all countries, both in customer loans and customer funds Strong profit growth boosted by higher revenue and eff
Slide 56: Corporate Centre
54 Corporate Centre NII impacted by the increased liquidity buffer Positive impact of FX hedging cost reflected in results from financial transactions Operating expenses down -12% YoY Provisions include non-recurring charges for certain holdings whose valuation has been affected by the crisis P&L* 2
Slide 57: Appendix index
55 Other countries. Detail 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 58: Retail Banking
56 Retail Banking 768 710 Loans Funds EUR bn and % change YoY in constant euros Activity 61% Weight of profit / operating areas +6% YoY Loyal customers +15% YoY Digital customers +4% +7% Our priority is to ensure the necessary financial support for our stakeholders Focus on accelerating our digital
Slide 59: Corporate & Investment Banking
57 Corporate & Investment Banking 1,783 1,507 1,754 3534,688 5,397 2019 2020 Global Transaction Banking Global Debt Financing Global Markets Capital & Other (1) Constant euros. Customer loans excluding reverse repos. Customer deposits excluding repos Total income +15% +2% +27% +12% +11% (Constant EU
Slide 60: Wealth Management & Insurance
58 Wealth Management & InsuranceWM&I P&L* Q4'20 % Q3'20 2020 % 2019 NII 113 9.7 454 -15.3 Net fee income 306 6.4 1,194 6.5 Total income 568 14.7 2,135 3.3 Operating expenses -227 6.3 -906 -0.4 Net operating income 341 21.1 1,229 6.2 LLPs -6 -40.9 -28 -- Underlying PBT 342 27.3 1,199 2.6 Underlying a
Slide 61: Appendix index
59 Other countries. Detail 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 62: Highly liquid balance sheet
60 Santander has a highly liquid balance sheet with a large contribution from customer deposits and diversified MLT wholesale debt instruments 78 115 205 23 916 167 44 849 1,199 1,199 Assets Liabilities Dec-20 Dec-19 Spain 2 175% 143% SCF 326% 248% UK 2 152% 145% Portugal 123% 134% Poland 187% 149%
Slide 63: MLT debt issuance and maturity profile
61 In 2020, the Group has issued EUR 30 bn1 of MLT debt and is able to cover its very manageable maturity profile Public market issuances in 2020 (1) Data include public issuances from all units with period-average exchange rates. Excludes securitisations (2) Other public market issuances in Mexico,
Slide 64: Interest rate risk and ALCO portfolios
62 We actively manage interest rate risk and our ALCO portfolios to optimize results while maintaining an appropriate risk profile Spain, 9% SCF, 7% UK, 8% Poland, 15% Portugal, 4%USA, 14% Mexico, 12% Brazil, 19% Chile, 9% Other S Am., 3% (1) Parent bank (2) Ring-fenced bank (3) SBNA. SCUSA has posi
Slide 65: Issuances 2020 against funding plan
63 Issuances 2020 against funding plan Plan Issued Plan Issued Plan Issued Plan Issued Santander S.A 4-5 3.1 7-8 6.9 1-2 3.8 12-15 13.8 SCF 6-8 3.8 - 0.0 - 0.0 6-8 3.8 UK 6-8 4.9 2-3 1.6 - 0.0 8-11 6.5 SHUSA - - 1-2 1.3 - 0.0 1-2 1.3 TOTAL 16-21 11.8 10-13 9.8 1-2 3.8 27-36 25.4 TOTALHybridsSenior N
Slide 66: 2021 funding plan
64 2021 funding plan Note: Issuance plan subject to, amongst other considerations, market conditions and regulatory requirements. Other secured issuances (for example ABS, RMBS, etc.) are not considered in the table above (1) Two hybrid issuances in Q4 2020 totalling EUR 2.3 billion. Issuance of add
Slide 67: CET1 management buffer
65 Regulatory changes in Q1 and increased capital levels, increased the Group’s CET1 management buffer to nearly 350 bps 4.50% 4.50% 12.34% 1.50% 0.84% 2.50% 2.50% 1.00% 1.00% 0.19% 0.01% 1.50% 1.78% 1.61% 2.00% 2.38% 2.23% 13.19% 13.01% 16.18% Reg. min 2020 pre-COVID measures Reg. min 2020 post-COV
Slide 68: TLAC ratios
66 TLAC ratios for the Resolution Group headed by Banco Santander, S.A. TLAC Ratio EUR mn Mar-20 Jun-20 Sep-20 Dec-20 (e) Own Funds 91,550 86,335 86,191 86,686 of which: Common Equity Tier 1 (CET1) capital 75,821 70,746 70,829 69,301 of which: Additional Tier 1 (AT1) capital 7,829 7,794 7,740 7,723
Slide 69: Group CET1 quarterly evolution
67 Group CET1 grows 36 bps QoQ, exceeding our 11%-12% target CET1 ratio quarterly evolution 12.34 -0.27 11.98 +0.23 +0.08 +0.22 +0.10 Sep-20 Organic generation Regulatory & Models One-offs & corp transactions Markets & others Dividend accrual release Dec-20
Slide 70: Appendix index
68 Other countries. Detail 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 71: Yield on loans
69 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 EUROPE 2,77 2,75 2,70 2,68 2,66 2,47 2,40 2,42 Spain 2,05 2,08 2,02 2,02 1,99 1,86 1,82 1,85 Santander Consumer Finance 4,51 4,48 4,41 4,26 4,27 4,17 4,08 4,08 United Kingdom 2,72 2,67 2,63 2,59 2,52 2,37 2,35 2,39 Portugal 1,79 1,76 1,71 1,64 1,63
Slide 72: Cost of deposits
70 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 EUROPE 0,42 0,42 0,41 0,41 0,39 0,28 0,16 0,12 Spain 0,14 0,14 0,13 0,13 0,06 0,04 0,04 0,04 Santander Consumer Finance 0,60 0,61 0,60 0,58 0,57 0,53 0,48 0,42 United Kingdom 0,67 0,70 0,70 0,69 0,69 0,52 0,29 0,23 Portugal 0,14 0,12 0,10 0,10 0,08
Slide 73: Appendix index
71 Appendix Other countries. Detail 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
Slide 74: Moratoria breakdown by segment and region
72 EUR bn, 31-Dec-20 % loan book (*) o/w: expired % Stage 1 % Stage 2 % Stage 3 Total Group 112 12% 89 79% 82% 15% 3% Detail by segments Mortgages 70 22% 55 79% 87% 11% 2% Consumer 20 9% 18 88% 77% 17% 7% SMEs & Corporates 22 7% 16 72% 74% 24% 3% Total moratoria Expired as % of Total Expired Breakdo
Slide 75: Stage exposure and coverage
73 (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 25 bn in December 2020, EUR 29 bn in September 2020, EUR 35 bn in June 2020 , EUR 31 bn in March 2020 and EUR 31 bn in December 2019) Expos
Slide 76: NPL ratio
74 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 EUROPE 3,61 3,48 3,47 3,25 3,19 3,24 3,13 3,15 Spain 7,29 7,02 7,23 6,94 6,88 6,55 5,98 6,23 Santander Consumer Finance 2,33 2,24 2,25 2,30 2,43 2,52 2,50 2,36 United Kingdom 1,17 1,13 1,08 1,01 0,96 1,08 1,30 1,21 Portugal 5,77 5,00 4,90 4,
Slide 77: Coverage ratio
75 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 EUROPE 49,5 49,9 48,2 49,8 54,1 53,4 55,8 57,3 Spain 43,3 42,9 40,6 41,1 44,6 43,3 46,0 47,1 Santander Consumer Finance 105,3 105,9 104,2 106,1 109,6 106,1 108,2 111,0 United Kingdom 30,9 31,9 34,1 36,5 43,0 46,0 44,5 47,9 Portugal 50,7 52,9
Slide 78: NPLs and loan-loss allowances by area
76 España, 27.1% SCF, 11.4% Reino Unido, 6.4% Portugal, 4.4% Polonia, 4.4% Otros Europa, 0.8% EE.UU., 17.8% México, 4.6% Otros Sudamérica, 0.6% Argentina, 1.1% Chile, 5.2% Brasil, 16.2% Loan-loss allowancesNon-performing loans Non-performing loans and loan-loss allowances. Breakdown by operating are
Slide 79: Cost of credit
77 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 EUROPE 0,24 0,24 0,25 0,28 0,40 0,47 0,53 0,62 Spain 0,40 0,41 0,41 0,43 0,64 0,68 0,80 1,01 Santander Consumer Finance 0,38 0,36 0,38 0,48 0,66 0,78 0,84 0,88 United Kingdom 0,07 0,06 0,08 0,10 0,14 0,23 0,27 0,28 Portugal 0,03 0,03 0,00 (0
Slide 80: Appendix index
78 Appendix Other countries. Detail 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
Slide 81: Santander Responsible Banking goals
79 Santander Responsible Banking goals 2018 2021 20252020*2019 Top 10 company to work for1 Women on the Board Women in senior leadership positions2 Equal pay gap3 Financially empowered people4 Green finance raised and facilitated5 (euros) Electricity used from renewable energy sources6 Scholarships,
Slide 82: Appendix index
80 Appendix Other countries. Detail 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
Slide 83: Quarterly income statement: Group
81 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 8.682 8.954 8.806 8.841 8.487 7.715 7.773 8.019 35.283 31.994 Net fee income 2.931 2.932 2.955 2.961 2.853 2.283 2.423 2.456 11.779 10.015 Gains (losses) on financial transactions and other 472 465 705 790 474 706 891 5
Slide 84: Quarterly income statement: Group constant EUR
82 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 7.695 7.938 7.971 7.986 7.860 7.698 8.043 8.392 31.590 31.994 Net fee income 2.569 2.585 2.668 2.666 2.646 2.299 2.502 2.568 10.488 10.015 Gains (losses) on financial transactions and other 457 465 695 756 466 679 907 5
Slide 85: Quarterly income statement: Europe
83 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 3.561 3.580 3.530 3.531 3.435 3.352 3.549 3.710 14.201 14.046 Net fee income 1.327 1.304 1.310 1.319 1.315 1.098 1.162 1.162 5.260 4.737 Gains (losses) on financial transactions and other 337 304 455 443 225 126 444 114
Slide 86: Quarterly income statement: Europe constant EUR
84 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 3.517 3.536 3.520 3.476 3.391 3.358 3.566 3.731 14.048 14.046 Net fee income 1.318 1.295 1.309 1.306 1.304 1.100 1.166 1.167 5.228 4.737 Gains (losses) on financial transactions and other 337 302 454 440 225 125 444 115
Slide 87: Quarterly income statement: Spain
85 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 1.009 1.009 967 934 925 931 1.034 1.067 3.919 3.957 Net fee income 623 624 614 620 643 535 562 573 2.481 2.314 Gains (losses) on financial transactions and other 224 216 408 258 220 96 204 (8) 1.107 512 Total income 1.8
Slide 88: Quarterly income statement: SCF
86 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 941 971 977 960 979 947 945 961 3.848 3.832 Net fee income 214 201 213 195 187 159 205 199 823 750 Gains (losses) on financial transactions and other 13 (18) 14 30 5 (11) 45 63 39 103 Total income 1.167 1.154 1.203 1.18
Slide 89: Quarterly income statement: SCF constant EUR
87 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 924 953 960 948 972 952 945 962 3.785 3.832 Net fee income 213 200 212 194 186 159 205 200 819 750 Gains (losses) on financial transactions and other 12 (18) 14 29 6 (11) 46 63 38 103 Total income 1.149 1.135 1.187 1.17
Slide 90: Quarterly income statement: United Kingdom
88 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 975 944 908 961 898 871 976 1.063 3.788 3.808 Net fee income 216 207 217 226 193 96 117 99 866 506 Gains (losses) on financial transactions and other 15 32 (5) 33 6 12 23 (16) 74 25 Total income 1.206 1.183 1.119 1.220
Slide 91: Quarterly income statement: United Kingdom GBP
89 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 850 825 820 827 774 773 881 958 3.322 3.386 Net fee income 189 181 195 194 166 87 107 90 759 449 Gains (losses) on financial transactions and other 13 28 (4) 29 5 10 21 (14) 65 22 Total income 1.052 1.034 1.011 1.050 94
Slide 92: Quarterly income statement: Portugal
90 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 216 213 214 213 202 197 193 195 856 787 Net fee income 98 99 96 98 101 90 94 103 390 388 Gains (losses) on financial transactions and other 44 42 22 21 47 30 25 19 129 121 Total income 357 354 331 332 350 317 312 317 1.
Slide 93: Quarterly income statement: Poland
91 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 281 284 298 307 296 251 246 243 1.171 1.037 Net fee income 113 117 119 117 116 104 112 120 467 452 Gains (losses) on financial transactions and other (18) 39 24 34 (48) 23 35 24 80 35 Total income 377 440 442 459 365 37
Slide 94: Quarterly income statement: Poland constant EUR
92 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 1.209 1.216 1.288 1.317 1.279 1.134 1.095 1.096 5.030 4.604 Net fee income 488 499 514 504 503 467 498 541 2.005 2.009 Gains (losses) on financial transactions and other (76) 168 104 147 (206) 95 156 109 343 154 Total i
Slide 95: Quarterly income statement: Other Europe
93 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 139 159 166 155 134 155 155 182 620 626 Net fee income 62 56 52 63 74 115 71 68 234 328 Gains (losses) on financial transactions and other 60 (7) (8) 68 (6) (23) 110 33 112 114 Total income 261 209 211 286 202 246 337 2
Slide 96: Quarterly income statement: Other Europe constant EUR
94 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 139 159 166 154 134 153 156 183 618 626 Net fee income 62 56 52 63 73 114 72 69 233 328 Gains (losses) on financial transactions and other 60 (8) (9) 67 (7) (23) 111 33 111 114 Total income 261 208 209 284 200 244 339 2
Slide 97: Quarterly income statement: North America
95 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 2.173 2.230 2.259 2.265 2.261 2.079 2.075 2.055 8.926 8.469 Net fee income 439 463 448 427 461 400 406 394 1.776 1.661 Gains (losses) on financial transactions and other 142 226 277 257 214 228 196 243 902 881 Total inc
Slide 98: Quarterly income statement: North America constant EUR
96 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 2.087 2.117 2.130 2.120 2.131 2.065 2.152 2.121 8.454 8.469 Net fee income 416 434 418 395 431 401 423 405 1.663 1.661 Gains (losses) on financial transactions and other 145 223 271 246 208 220 202 251 884 881 Total inc
Slide 99: Quarterly income statement: USA
97 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 1.407 1.453 1.460 1.449 1.462 1.429 1.406 1.348 5.769 5.645 Net fee income 234 244 238 230 250 215 218 206 947 889 Gains (losses) on financial transactions and other 174 222 278 215 217 157 206 247 889 827 Total income
Slide 100: Quarterly income statement: USA constant USD
98 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 1.598 1.633 1.623 1.604 1.612 1.573 1.644 1.608 6.457 6.437 Net fee income 266 275 264 255 275 237 255 247 1.059 1.014 Gains (losses) on financial transactions and other 197 250 310 238 239 173 240 291 996 943 Total inc
Slide 101: Quarterly income statement: Mexico
99 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 766 777 798 816 798 650 669 707 3.157 2.825 Net fee income 204 218 210 197 211 185 189 188 829 772 Gains (losses) on financial transactions and other (32) 4 (1) 42 (2) 70 (10) (4) 13 54 Total income 939 999 1.007 1.054
Slide 102: Quarterly income statement: Mexico constant EUR
100 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 16.703 16.694 17.231 17.393 17.484 16.706 17.310 17.322 68.021 68.822 Net fee income 4.455 4.695 4.535 4.188 4.617 4.719 4.868 4.596 17.873 18.799 Gains (losses) on financial transactions and other (687) 83 (31) 906 (5
Slide 103: Quarterly income statement: South America
101 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 3.222 3.425 3.314 3.356 3.065 2.606 2.486 2.566 13.316 10.723 Net fee income 1.178 1.178 1.204 1.228 1.074 774 841 878 4.787 3.566 Gains (losses) on financial transactions and other 88 45 59 130 25 311 150 71 322 557 T
Slide 104: Quarterly income statement: South America constant EUR
102 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 2.365 2.565 2.617 2.701 2.611 2.597 2.663 2.852 10.248 10.723 Net fee income 847 869 948 977 907 786 900 974 3.641 3.566 Gains (losses) on financial transactions and other 71 50 56 110 23 294 160 79 287 557 Total incom
Slide 105: Quarterly income statement: Brazil
103 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 2.459 2.520 2.560 2.534 2.270 1.813 1.756 1.786 10.072 7.625 Net fee income 931 924 970 974 869 614 664 677 3.798 2.824 Gains (losses) on financial transactions and other 21 9 (7) 57 (3) 224 114 82 81 417 Total income
Slide 106: Quarterly income statement: Brazil constant BRL
104 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 10.516 11.095 11.272 11.534 11.100 10.725 11.066 11.446 44.416 44.336 Net fee income 3.980 4.070 4.271 4.429 4.250 3.679 4.167 4.324 16.750 16.420 Gains (losses) on financial transactions and other 91 41 (31) 254 (14)
Slide 107: Quarterly income statement: Chile
105 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 440 500 462 464 448 425 420 494 1.867 1.787 Net fee income 103 97 102 102 92 74 74 94 404 335 Gains (losses) on financial transactions and other 56 59 82 71 12 85 38 6 268 142 Total income 600 656 646 638 553 584 532 5
Slide 108: Quarterly income statement: Chile constant CLP
106 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 333.439 383.545 363.195 386.260 397.015 384.057 383.394 447.669 1.466.440 1.612.135 Net fee income 78.010 74.473 80.052 85.052 81.770 67.170 67.421 85.452 317.587 301.814 Gains (losses) on financial transactions and ot
Slide 109: Quarterly income statement: Argentina
107 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 213 298 180 250 241 261 218 192 940 912 Net fee income 116 125 88 118 76 56 70 71 446 273 Gains (losses) on financial transactions and other 2 (33) (31) (8) 1 (8) (14) (36) (70) (57) Total income 331 389 237 359 318 31
Slide 110: Quarterly income statement: Argentina constant ARS
108 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 10.117 14.548 18.638 19.924 16.991 22.846 24.646 29.613 63.227 94.096 Net fee income 5.486 6.131 8.976 9.403 5.327 5.132 7.611 10.109 29.996 28.179 Gains (losses) on financial transactions and other 102 (1.596) (2.372)
Slide 111: Quarterly income statement: Other South America
109 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 109 108 112 108 106 107 91 94 437 398 Net fee income 29 32 44 34 37 29 33 35 138 134 Gains (losses) on financial transactions and other 8 9 16 10 14 9 13 20 43 56 Total income 146 149 172 153 157 145 137 149 619 588 Op
Slide 112: Quarterly income statement: Other South America constant EUR
110 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 89 91 95 96 97 105 96 100 370 398 Net fee income 23 27 38 30 34 29 34 37 118 134 Gains (losses) on financial transactions and other 7 8 14 9 13 9 13 20 38 56 Total income 119 126 147 135 143 143 143 158 526 588 Operati
Slide 113: Santander Global Platform primary segment
111 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 22 23 23 23 31 32 33 33 92 129 Net fee income 2 1 2 2 13 18 24 26 6 81 Gains (losses) on financial transactions and other (5) (4) (1) (7) 1 (6) (9) (4) (17) (18) Total income 19 20 24 18 45 44 48 55 81 192 Operating ex
Slide 114: Corporate Centre quarterly income statement
112 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income (296) (304) (319) (333) (304) (354) (371) (345) (1.252) (1.374) Net fee income (14) (13) (9) (15) (9) (6) (11) (3) (50) (29) Gains (losses) on financial transactions and other (90) (106) (85) (34) 9 47 110 96 (315) 262
Slide 115: Retail Banking quarterly income statement
113 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 8.083 8.323 8.227 8.229 7.885 7.141 7.148 7.371 32.862 29.544 Net fee income 2.178 2.134 2.108 2.141 2.024 1.495 1.671 1.661 8.561 6.850 Gains (losses) on financial transactions and other 150 201 485 339 63 224 407 126
Slide 116: Retail Banking constant EUR
114 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 7.200 7.414 7.455 7.453 7.323 7.134 7.391 7.696 29.522 29.544 Net fee income 1.899 1.872 1.896 1.914 1.867 1.511 1.730 1.743 7.582 6.850 Gains (losses) on financial transactions and other 199 248 499 349 91 207 403 119
Slide 117: Corporate & Investment Banking quarterly income statement
115 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 654 700 657 716 671 713 788 781 2.728 2.953 Net fee income 352 374 421 373 404 406 361 379 1.520 1.550 Gains (losses) on financial transactions and other 272 217 153 337 225 307 248 114 978 893 Total income 1.278 1.292
Slide 118: Corporate & Investment Banking constant EUR
116 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 575 615 611 653 621 705 807 820 2.454 2.953 Net fee income 316 336 382 345 379 407 371 393 1.379 1.550 Gains (losses) on financial transactions and other 223 184 141 308 199 296 264 135 856 893 Total income 1.114 1.135
Slide 119: Wealth Management & Insurance quarterly income statement
117 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 141 143 141 146 132 104 104 113 570 454 Net fee income 273 298 298 330 320 279 290 306 1.199 1.194 Gains (losses) on financial transactions and other 110 121 113 114 134 100 104 149 457 487 Total income 523 562 551 589
Slide 120: Wealth Management & Insurance constant EUR
118 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 130 132 136 137 125 103 108 118 536 454 Net fee income 254 278 281 308 306 278 295 314 1.121 1.194 Gains (losses) on financial transactions and other 99 109 101 101 126 101 107 153 410 487 Total income 484 519 518 547
Slide 121: Santander Global Platform secondary segment
119 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 100 92 100 83 103 112 104 98 375 416 Net fee income 142 139 137 132 115 109 111 114 549 449 Gains (losses) on financial transactions and other 30 32 40 34 43 29 23 35 136 129 Total income 271 263 277 249 260 250 238 24
Slide 122: Santander Global Platform secondary segment constant EUR
120 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 2019 2020 Net interest income 85 81 88 77 96 111 107 102 331 416 Net fee income 113 112 117 114 104 109 116 121 457 449 Gains (losses) on financial transactions and other 27 29 38 32 42 29 23 35 127 129 Total income 225 222 244 223 241 249 246 258
Slide 123: Appendix index
121 Appendix Other countries. Detail 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
Slide 124: Glossary
122 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 HQLA: High qualit
Slide 125: Profitability and efficiency definitions
123 Notes: 1) The averages for the RoTE and RoRWA denominators are calculated on the basis of 13 months from December to December. 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 p
Slide 126: 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 127: 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: 3 February 2021 By: /s/ José García Cantera Name: José García Cantera Title: