Banco Santander, S.a. · BME:SAN
Banco Santander — FY2024 Earnings Presentation
64 slides from Banco Santander's earnings presentation, Feb 5, 2025
Slide 1: Form 6-K Report of Foreign Issuer
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, 2025 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 2024 Earnings presentation
Slide 3: Earnings Presentation FY'24
Earnings Presentation FY’24 5 February 2025
Slide 4: Important information: Non-IFRS and alternative performance measures
2 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
Slide 5: Important information: forward-looking statements
3 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 stat
Slide 6: Index
4 Index 1 FY'24 Highlights Progress on our strategy Group review 2 Final remarks 3 Appendix 4
Slide 7: Record profit on the back of 8mn new customers
5 Record profit on the back of 8mn new customers YoY and strong revenue growth A groundbreaking year in our transformation driving strong operating performance and profitable growth Delivering double-digit value creation and higher shareholder remuneration Note: YoY changes. In constant euros: FY'24
Slide 8: All-time high profit boosted by customer revenue and efficiency
6 All-time high profit boosted by customer revenue and efficiency improvements from our transformation Note: underlying P&L. All references to variations in constant euros across the presentation include Argentina in current euros to mitigate distortions from a hyperinflationary economy. From Q2 202
Slide 9: Global Retail and Consumer powerhouse with 173mn customers
7 We are a global Retail and Consumer powerhouse with 173mn customers Revenue (€bn) Contribution to Group revenue Efficiency RoTE FY'24 2025 RoTE ID target c.17% >14% >20% c.60% >30% 15-17% Note: YoY changes in constant euros. Contribution to Group revenue as a percentage of total operating areas, e
Slide 10: Retail delivering operational leverage in our transformation
8 Customer experience Operational leverage Global platform Success from our transformation Products & services digitally available 62% Retail delivering operational leverage with a groundbreaking year in our transformation Note: data and YoY changes in constant euros. (1) Metrics cover all products
Slide 11: Consumer: Openbank roll out and operational leverage
9 5.2 5.2 2023 2024 12.2 12.9 2023 2024 Customer experience Operational leverage Global platform Success from our transformation Key strategic drivers 1.10 0.95 2023 2024 Retail deposits cost-to-serve (%) Operating expenses / ANEAs (%) Total customers (mn) -1% -0.15pp -0.21pp Note: data and YoY chan
Slide 12: CIB, Wealth and Payments: driving fee growth and scale
10 499 552 2023 2024 1.1 1.2 2023 2024 +11% CIB, Wealth and Payments: driving fee growth and scale through global platforms CIB Leveraging our strengths to better serve our corporate customers and institutions Wealth Accelerating our customers’ connectivity with our global product platforms Payments
Slide 13: CET1 capital and EPS growth
11 +51bps EPS +18% YoYZero day-one impact from Basel III 12.8-1.00 -0.5912.3 +2.09 Dec-23 Net organic generation Shareholder remuneration Regulatory & models Dec-24 4.76 5.24 5.44 Dec-23 Dec-243 Note: zero day-one impact from Basel III under the final texts published in June 2024 of Regulation 2024/
Slide 14: We are building the Santander of tomorrow
12 We are building the Santander of tomorrow Scale Customer Diversification Our Aim To be the best open financial services platform
Slide 15: Santander's open financial services platforms
13 Cards Our global approach to technology drives innovation in a dynamic and fast-changing environment Santander’s open financial services platforms Channel Financing Insurance Payments Risk & Control Back-end Gravity
Slide 16: Ten years of business model transformation
14 2x Profit (€bn) Customers (mn) +56 Our business model and transformation over the last 10 years have provided sustained earnings, a stronger balance sheet and enabled us to accelerate profitable growth Growth FL CET1 1.5x (1) Total shareholder remuneration charged against the results correspondin
Slide 17: Well ahead of Investor Day targets for 2025
15Note: target payout defined as c.50% of Group reported profit (excluding non-cash, non-capital ratios impact items), distributed approximately 50% in cash dividend and 50% in share buybacks. Execution of the shareholder remuneration policy is subject to future corporate and regulatory decisions an
Slide 18: Index
16 Index 1 FY'24 Highlights Progress on our strategy Group review 2 Final remarks 3 Appendix 4
Slide 19: Revenue up 10% YoY
17 Revenue up 10% YoY, above our target, underpinned by customer activity across businesses Note: data and YoY % changes in constant euros. Total revenue 62,211 -237 56,614 +3,217 +697 +997 +489 +434 2023 Retail Consumer CIB Wealth Payments CC 2024 13,854 14,039 14,516 14,205 15,036 15,432 15,405 16
Slide 20: Net interest income
18 10,157 10,580 10,992 10,878 11,727 11,301 11,425 12,215 Q1'23 Q2 Q3 Q4 Q1'24 Q2 Q3 Q4 NIM Quarterly 2.89% -0.12 -0.062.74% +0.22 +0.11 2023 Asset yields Asset volumes Liability costs Liability volumes 2024 YoY performance More than 80% of the Group’s NII comes from our Retail and Consumer busines
Slide 21: Excellent fee performance
19 13,010 -42 11,749 +320 +290 +449 +240 +3 2023 Retail Consumer CIB Wealth Payments CC 2024 Excellent fee performance as we execute our strategy to capture network effects across the Group Note: data and YoY % changes in constant euros. Net fee income Constant €mn 3,008 2,978 3,018 2,745 3,156 3,17
Slide 22: ONE Transformation driving efficiency gains and positive jaws
20 Group ONE Transformation is driving structural efficiency gains and positive jaws Efficiency 12M rolling Costs Net operating income 6,112 6,238 6,346 6,340 6,429 6,281 6,450 6,874 Revenue 7,743 7,801 8,171 7,866 8,607 9,151 8,955 9,464 Q1'23 Q2 Q3 Q4 Q1'24 Q2 Q3 Q4 13,854 14,039 14,516 14,205 15,
Slide 23: Consistent execution of ONE Transformation
21 Consistent execution of ONE Transformation, leveraging Santander’s network and scale, is improving both revenue and costs ahead of our plan • Wealth: collaboration fees with CIB and Corporates reached €4.0bn (+12% vs. FY'23) • Consumer: expansion of OEM agreements • Multi-Nationals: +5% YoY reven
Slide 24: Cost of risk improvement and sound credit quality
22 Cost of risk improvement and sound credit quality Note: data and YoY % changes in constant euros. Credit quality metrics and LLPs CoR 12 month LLPs Constant €mn 1.05% 1.08% 1.13% 1.18% 1.20% 1.21% 1.18% 1.15% 2,829 2,818 3,154 3,293 3,016 3,051 3,057 3,209 Q1'23 Q2 Q3 Q4 Q1'24 Q2 Q3 Q4 Dec-23 Sep
Slide 25: Strong organic capital generation and RWA mobilization
23 1 12.8 -0.26 -0.17 -0.09 12.5 +0.82 Sep-24 Organic generation Shareholder remuneration Regulatory & Models Markets & others Dec-24 Strong organic capital generation, with profitable front-book growth of 23% RoTE and significant RWA mobilization CET1 performance and capital productivity FL CET1 %
Slide 26: A new phase of value creation driven by strong profitability
24 A new phase of value creation driven by strong profitability 2023-2024 New phase of value creation 2016-2022 Value creation USD as a natural hedge for LatAm currencies 2016-2022 average 2023-2024 average Foreign currency sensitivity2 EUR million Currency 1% appreciation 1% depreciation US dollar
Slide 27: Index
25 Index 1 FY'24 Highlights Progress on our strategy Group review 2 Final remarks 3 Appendix 4
Slide 28: 2024 targets versus achievements
26 We are only scratching the surface of our potential as a group with our strong performance in 2024 (1) YoY change in constant euros, except Argentina in current euros. (2) Fully-loaded definition as of 1 January 2025. Revenue1 Efficiency CoR FL CET1 RoTE 2024 initial targets 2024 achievements Rec
Slide 29: Aiming higher for 2025 and beyond
27 Note: targets market dependent. Based on macro assumptions aligned with international economic institutions. CET1 ratio phased-in CRR3. (1) Share buyback target against 2025-26 results including: i) the buybacks resulting from application of our existing shareholder remuneration policy plus ii) a
Slide 30: Index
28 Index 1 FY'24 Highlights Progress on our strategy Group review 2 Final remarks 3 Appendix 4
Slide 31: Appendix
29 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary For more details, refer to the document entitled "Supplementary Information", published to
Slide 32: Consistently overdelivered on all our strategic plans
30 2019 – 2022 plan We have consistently overdelivered on all our strategic plans throughout the economic cycle 2023 – 2025 plan 2015 – 2018 plan On track to exceed our targets Laying the foundations Building global platforms and preparing the path towards ONE Santander A new phase of value creation
Slide 33: Investor Day targets summary
31 2022 2023 2024 2025 ID targets 13.4 15.1 16.3 15-17 40 50 50 50 23 21.5 17.9 Double-digit 160 165 173 c.200 99 100 103 c.125 45.8 44.1 41.8 c.42 - 10 9 c.+8 12.0 12.3 12.8 >12 80 84 87 c.85 94.5 114.6 139.4 120 53 67.7 88.8 100 - 1.8 4.3 5 c.29 31.4 31.3 35 c.1 c.0 c.0 c.0 (1) Target payout defin
Slide 34: Appendix
32 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary
Slide 35: Group P&L and excluding Argentina
33 Group P&L and excluding Argentina ex. Argentina Note: underlying P&L. P&L Current Constant Current Constant € million 2024 2023 % % % % NII 46,668 43,261 8 10 6 7 Net fee income 13,010 12,057 8 11 6 9 Other income 2,533 2,329 9 12 17 19 Total revenue 62,211 57,647 8 10 6 8 Operating expenses -26,
Slide 36: Appendix
34 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary
Slide 37: Foreign currency risk
35 Foreign currency risk EUR million Currency 1% appreciation 1% depreciation 1% appreciation 1% depreciation US dollar -3.9 4.0 -168.4 171.8 Pound sterling -4.4 4.5 -96.5 98.4 Brazilian real -4.3 4.3 -144.1 147.0 Mexican peso -0.5 0.5 -33.9 34.6 Chilean peso -2.1 2.2 -15.3 15.6 Polish zloty -0.4 0.
Slide 38: Appendix
36 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary
Slide 39: Detail by global business
Detail by global business @ Santander
Slide 40: Retail & Commercial Banking Highlights
38 Key data Retail & Commercial Banking Highlights Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). • Transformation efforts are reflected in the growth of our total customers (+8mn YoY), efficiency improvement (-3pp to 39.7%) and higher profitability (RoTE +4p
Slide 41: Retail Spain and Retail UK
39 Retail Spain Retail UK Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). • Loans down YoY as a result of our focus on profitability. Deposits and mutual funds impacted by a competitive environment • PBT affected YoY by higher cost of deposits and lower volume
Slide 42: Retail Mexico and Retail Brazil
40 Retail Mexico Retail Brazil Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). • Loans increased YoY across business lines. Deposits also increased, especially demand deposits. Mutual funds rose double-digits • PBT up 11% YoY supported by higher revenue, both
Slide 43: Digital Consumer Bank Highlights
41 Highlights Digital Consumer Bank Note: Dec-24 data and YoY changes (new lending, loans and deposits in constant euros). P&L Key data Underlying P&L* Q4'24 % Q3'24 2024 % 2023 % 2023¹ NII 2,798 5.9 10,777 6.1 5.4 Net fee income 394 5.3 1,508 23.8 22.7 Total revenue 3,332 5.2 12,916 5.7 5.0 Operati
Slide 44: DCB Europe and Consumer US
42 DCB Europe Consumer US Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). Loans Deposits Mutual Funds Yield on loans Cost of deposits Efficiency Underlying P&L* Q4'24 % Q3'24 2024 % 2023 % 2023¹ NII 1,191 1.6 4,651 1.2 1.1 Net fee income 97 25.7 303 28.1 28.1
Slide 45: Corporate & Investment Banking Highlights
43 Corporate & Investment Banking Highlights Loans Deposits Efficiency CoR RoTE €137bn 0% €137bn -10% 45.6% +0.6pp 0.10% -0bps 18.1% +0.5pp Key data Underlying P&L* Q4'24 % Q3'24 2024 % 2023 % 2023¹ NII 1,088 20.5 4,020 14.8 11.9 Net fee income 657 6.8 2,548 21.4 19.6 Total revenue 2,083 0.6 8,343 1
Slide 46: Wealth Management & Insurance
44 Wealth Management & Insurance Note: Dec-24 data (AuMs); FY'24 data (net new money, net sales and GWPs). YoY changes in constant euros. (2) Considering annualized net new money as a % of total CAL and net sales as a % of SAM’s AuMs. (3) Including fees generated by asset management and insurance ce
Slide 47: Payments
45 Payments Note: Dec-24 data and YoY changes in constant euros. In PagoNxt, a negative growth rate in profit indicates a lower loss. Number of cards managed by Cards is 102 million, as it excludes those managed by Digital Consumer Bank including Openbank (3 million cards). (2) Excluding a one-time
Slide 48: Corporate Centre
46 Corporate Centre Highlights P&L Underlying P&L* 2024 2023 NII -308 -41 Gains / losses on financial transactions -408 -302 Operating expenses -379 -391 LLPs and other provisions -262 -132 Tax and minority interests 163 -36 Attributable profit -1,154 -998 (*) € mn. • NII down as higher liquidity bu
Slide 49: Detail by region and country
47 Detail by region and country Note: DCB Europe is officially reported as a secondary segment. Nevertheless, its detail is included in the ‘Detail by global business’ appendix within the Digital Consumer Bank explanation and in the Supplementary Information.
Slide 50: Europe Highlights
48 Highlights Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). Europe • We continue to accelerate our business transformation to achieve higher growth and a more efficient operating model • Customers increased across the region (+527k YoY), mainly driven by Spa
Slide 51: Spain and UK
49 Spain UK Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). • Sustained customer growth YoY. Loans affected by SME amortizations. Deposit performance in line with our strategy to reduce excess corporate deposits. Mutual funds up double-digits • Profit +59% YoY
Slide 52: Portugal and Poland
50 Portugal and Polonia Portugal Poland Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). • Loans up supported by sound new business levels. Solid increases in deposits and mutual funds, in line with sustained customer growth in high value-added segments • Profi
Slide 53: North America Highlights
51Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). North America Highlights Key data and P&L Underlying P&L* Q4'24 % Q3'24 2024 % 2023 % 2023¹ NII 2,556 0.8 10,330 3.0 1.7 Net fee income 654 2.1 2,594 20.5 18.3 Total revenue 3,509 3.7 13,915 7.0 5.6 Operating e
Slide 54: US and Mexico
52Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). (2) Adjusted RoTE: adjusted based on Group’s deployed capital calculated as contribution of RWAs at 12%. Using tangible equity, RoTE is 7.5%. MexicoUS Loans Deposits Mutual Funds Efficiency CoR RoTE2 Loans Depo
Slide 55: South America
53 South America Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). Highlights Key data and P&L Underlying P&L* Q4'24 % Q3'24 2024 % 2023 % 2023¹ NII 4,210 20.5 15,566 27.3 19.4 Net fee income 1,348 17.3 4,864 11.2 3.9 Total revenue 5,316 14.7 19,783 17.9 10.1 Op
Slide 56: Brazil and Chile
54Note: Dec-24 data and YoY changes (loans, deposits and mutual funds in constant euros). Brazil Chile Loans Deposits Mutual Funds Efficiency CoR RoTE Loans Deposits Mutual Funds Efficiency CoR RoTE €94bn +10% €81bn +8% €49bn +6% 32.1% -2.4pp 4.51% -26bps 17.5% +3.8pp €41bn +1% €30bn +10% €13bn +32%
Slide 57: Argentina
55Note: Dec-24 data and YoY changes (profit, loans, deposits and mutual funds in current euros). (1) The exchange rate resulting from the sale of local bonds denominated in Argentine pesos in US dollars (dual denomination peso/dollar bonds). Argentina • We continue to focus on enhancing customer ser
Slide 58: Appendix
56 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary
Slide 59: Reconciliation of underlying results to statutory results
57 Reconciliation of underlying results to statutory results EUR mn (1) Includes exchange differences. Explanation of 2024 adjustments: 1. Temporary levy on revenue in Spain in Q1 2024, totalling EUR 335 million, which was reclassified from total income to other gains (losses) and provisions. 2. Pro
Slide 60: Appendix
58 Appendix Investor Day Targets summary Group P&L and excluding Argentina Foreign currency risk Detail by global business, region and country Reconciliation of underlying results to statutory results Glossary
Slide 61: Glossary - Acronyms
59 Glossary - Acronyms • A2A: account to account • AM: Asset management • AuMs: Assets under Management • bn: Billion • bps: Basis points • c.: Circa • CET1: Common equity tier 1 • CHF: Swiss franc • CF: Corporate Finance • CIB: Corporate & Investment Banking • CoE: Cost of equity • Consumer: Digita
Slide 62: Glossary - Definitions
60 Glossary - Definitions PROFITABILITY AND EFFICIENCY • RoTE: Return on tangible capital: Group attributable profit / average of: net equity (excluding minority interests) – intangible assets (including goodwill) • RoTE post-AT1: Return on tangible capital: Group attributable profit – cost of AT1s
Slide 63: 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 64: 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: 5 February 2025 By: /s/ José García Cantera Name: José García Cantera Title: