Banco Santander, S.a. · BME:SAN
Banco Santander — Q1 2021 Earnings Presentation
109 slides from Banco Santander's earnings presentation, Apr 28, 2021
Slide 1: Q1'21 Earnings Presentation
28 April 2021 Q1’21 Earnings Presentation All. Together. Now.
Slide 2: Important information
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 (“APMs
Slide 3: Important information
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 statements
Slide 4: Index
Index 1 2 3 4 Highlights and Business Key Appendix Group performance areas review takeaways 4
Slide 5: Highlights
Highlights • Net operating income up 15% YoY driven by 8% revenue growth (volume up: +2% loans, +8% deposits) and cost control Growth • Strong digital adoption: 50% of sales through digital channels in Q1’21 (41% in Q1’20) and 44 million digital customers (+15% YoY) • We announced the intention to m
Slide 6: Activity in Q1'21 recovering at different speeds affected by the operating and financial environment
Activity in Q1’21 recovering at different speeds affected by the operating and financial environment Group Interest-rates. • Low interest rates. Brazil started to raise interest rates in Q1’21 • Negative impact on NII Monetary policy • New sizable fiscal stimulus in the US (relaunched Paycheck Prote
Slide 7: Group Performance
7 Group Performance ~ «> Santander
Slide 8: Q1 underlying profit of EUR 2 billion driven by solid net operating income growth
Q1 underlying profit of EUR 2 billion driven by solid net operating income growth (+15%1 YoY) and lower cost of credit Underlying Contribution att. profit1 to Group’s % change Q1’21 (vs. Q1’20) (EUR mn) Underlying profit1 EUR mn Q1'21 Q1'20 Euros Constant euros NII 7,956 8,487 -6 5 826 Europe +338%
Slide 9: Strong performance in revenue, costs and LLPs in the quarter
Strong performance in revenue, costs and LLPs in the quarter +3% vs. Q4’20 Underlying attributable profit 11,390 Total 11,030 11,066 Constant EUR mn income +50% 10,565 vs. Q4’20 10,266 -3% 2,138 vs. Q4’20 1,716 1,456 5,111 4,924 5,071 5,283 5,118 Costs 1,423 +8% vs. Q4’20 Net 192 6,272 operating 5,9
Slide 10: NII was 5% higher YoY in line with increase in average volumes
NII was 5% higher YoY in line with increase in average volumes Net interest income Constant EUR mn +5% vs. Q1’20 -2% • YoY growth in loans (+2%) and deposits (+8%) vs. Q4’20 8,093 7,956 • Interest rates remained much lower YoY, despite 7,567 7,748 the recent hike in Brazil (+75 bps) 7,411 • Positive
Slide 11: Net fee income recovered to pre-pandemic levels
Net fee income recovered to pre-pandemic levels, growing in higher value-added services and products Net fee income Constant EUR mn +0.2% vs. Q1’20 • Q1 affected by new lockdowns and seasonality in Brazil +4% vs. Q4’20 • Positive YoY performance in CIB (+28%) and Insurance (+5%) 2,543 2,548 2,460 2,
Slide 12: Delivered broad-based efficiency gains with cost savings in all European countries
Delivered broad-based efficiency gains with cost savings in all European countries fueled by our new operating model Costs Efficiency -8% -3% -858 bps Europe -3.8% 50% -4% -3% North -32 bps America +2.8% +1% +1% 41% -135 bps South America +0.8%1 -3% +1% 34% Digital -9 bps DCB Consumer +1.0% 46% Bank
Slide 13: Improved cost of credit: lower LLPs in most countries
Improved cost of credit: lower LLPs in most countries, particularly in the US and Brazil Loan-loss provisions Credit quality indicators Constant EUR bn Mar-20 Dec-20 Mar-21 -43% vs. Q1’20 Cost of credit1 1.17% 1.28% 1.08% -25% vs. Q4’20 3.5 3.0 2.6 2.6 NPL ratio 3.25% 3.21% 3.20% 2.0 Coverage ratio
Slide 14: Strong operating performance resulted in increased profitability and TNAVps
Our strong operating performance resulted in increased profitability and TNAVps… Underlying RoTE Underlying earnings per share TNAV per share EUR cents EUR 13.0% TNAV + dividend 11.6 +2% QoQ 4.21 7.4% 7.4 3.79 3.84 2.1% 1.4 Q1'20 Q4'20 Q1'21 Mar-20 Dec-20 Mar-21 Q1'20 2020 Q1'21 Statutory RoTE Q1’20
Slide 15: High organic generation maintained solid capital position
…and high organic generation which enabled us to maintain our solid capital position CET1 ratio quarterly evolution % +0.28 12.34 -0.13 12.30 -0.09 -0.10 Dec-20 Organic Regulatory & Markets & others Restructuring Mar-21 generation Models charges (1) (2) FL CET1 ratio 11.89 11.89 Note: Does not inclu
Slide 16: Index
Index 1 2 3 4 Group Business Key Appendix performance areas review takeaways 16
Slide 17: Business and profit growth leveraging our geographic diversification
Business and profit growth leveraging our geographic diversification Digital Customer Customer Net operating Underlying Underlying customers loans deposits income att. profit RoTE Q1’21 (vs. Q1’20) (mn) (EUR bn) (EUR bn) (EUR mn) (EUR mn) 15.6 558 576 2,077 826 8% Europe +9% +2% +7% +36% +338% +6.6
Slide 18: Spain
Q1’21 profit boosted by the increase in net operating income and reduced LLPs Hefty cost reduction and productivity increase Spain 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 margin p
Slide 19: United Kingdom
Volume growth driven by mortgages, government backed business loans and both retail banking and corporate deposits In the quarter, positive margin management was not reflected in NII UK performance due to the lower day count Profit increased QoQ from lower LLPs and the UK Bank Levy in Q4 Profit up Y
Slide 20: Brazil
Maintained our growth strategy, reflected in double-digit growth in digital customers and volumes Brazil 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. High
Slide 21: USA
Remarkable speed of vaccination and massive fiscal stimulus support activity recovery and cost of credit improvement USA 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 portfo
Slide 22: Mexico
The Group announced its intention to acquire the full 8.3% outstanding shares of Santander México Mexico QoQ profit up primarily due to higher fees, trading gains and lower costs Profit down YoY: NII pressure (lower rates and credit volumes as the corporate segment normalizes). Flat costs and lower
Slide 23: Digital Consumer Bank
Ongoing execution of business digitalization. The conversion of creditors Digital into full customers helped to maintain high profitability DCB Consumer New lending (-3% vs. Q1’20) impacted by lockdowns in some countries (especially in January and February), although positive activity signs in March
Slide 24: Global businesses
Global businesses Corporate & Investment Banking Wealth Management & Insurance AUM’s up in Private Banking and SAM: EUR 4,700 mn net sales. Remarkable SCIB business growth from all core businesses and Total Insurance fees up 5% YoY geographies Total contribution to Group’s profit up 1% vs. Q1’20 pre
Slide 25: Innovative payments solutions for both Santander and non-Santander clients
Innovative payments solutions for both Santander and non-Santander clients Merchant solutions Trade solutions Getnet is our merchant payments global franchise One Trade is our global trade and international payments platform, offering in-store and ecommerce acquiring, addressing the needs of SMEs an
Slide 26: Corporate Centre
Q1 results impacted by higher provisions to reinforce our balance sheet Corporate Positive impact of FX hedging reflected in 2020 in Gain/Losses on FT Centre Lower costs (-7% YoY) and reduced income tax P&L* Q1'21 Q4'20 Q1'20 NII -324 -345 -304 Gains/Losses on FT -44 104 14 Operating expenses -79 -8
Slide 27: Index
Index 1 2 3 4 Group Business Key Appendix performance areas review takeaways 27
Slide 28: Strong business in Q1'21
Strong business in Q1’21 Solid P&L Strengthened balance sheet and improved profitability EUR 2.1 bn Revenue Loans: +EUR 17 bn Cost of credit underlying attributable profit +8% Deposits: +EUR 65 bn 1.08% Improved FY2021 restructuring CET1 above the target CET1 efficiency charges recorded range of 11-
Slide 29: Near-term outlook
Near-term outlook • 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 Business • Lower cost of credit expected amid current uncertainty, wit
Slide 30: Index
Index 1 2 3 4 Group Business Key Appendix performance areas review takeaways 30
Slide 31: Appendix
Appendix 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 31
Slide 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 Europe ALCO sales (Portugal) Strong efficiency improvement as a result of the ongoing optimization plans in all countries Cost of credit normal
Slide 33: Portugal
Sharp rise in digital customers with higher digital sales penetration Portugal Increase in customer loans boosted by new lending, mainly in corporates and mortgages Profit growth due to ALCO portfolio sales, cost control and lower LLPs KEY DATA Q1'21 vs. Q1'20 P&L* Q1'21 vs. Q4'20 vs. Q1'20 VOLUMES1
Slide 34: Poland
Q1’21 impacted by corporate loans drop, low rates and charges related to CHF mortgages Poland Net operating income after LLPs up 40% YoY driven by efficiency and lower LLPs. Resilient revenue (lower rates offset by fees and trading gains) QoQ performance impacted by BFG contribution KEY DATA Q1'21 v
Slide 35: North America
Increasing joint initiatives between Mexico and the US to improve customer attraction, share best practices and technology programmes North Robust customer funds underpinned by the US. Loan demand normalized America following the uptick at the beginning of the pandemic and business disposals Strong
Slide 36: South America
Strengthening regional connections in order to keep growing in a profitable manner Improved customer experience and increased loyalty, allied to rigorous cost and risk South management America QoQ comparison impacted by seasonality and lockdowns in some countries Profit rose YoY boosted by double-di
Slide 37: Chile
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) Chile Profit QoQ impacted by lower inflation, weak consumption associated to lockdown and increase
Slide 38: Argentina
Ongoing digital transformation: strong digital customers growth, Getnet reached 21 k customers since October and launch of Cockpit Argentina 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. Cost
Slide 39: Uruguay and Andean region
High profitability sustained across all countries supported by stronger Uruguay customer loyalty, leading to greater transactionality and Uruguay: underlying profit decreased YoY impacted by lower interest rates and lower gains on financial transactions Andean region Peru: profit rose boosted by hig
Slide 40: Appendix
Appendix 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 40
Slide 41: Retail Banking
Focus on accelerating our digital transformation, through a multi-channel strategy adapting channels to new business trends and customer needs Retail Banking 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
Slide 42: Corporate & Investment Banking
SCIB continues executing its strategy to strengthen its position as a strategic advisor. The recent creation of the DSG team1 being one Corporate & example of further developing its advisory expertise SCIB Investment Banking Profit boosted by strong revenue growth, backed by market activities, toget
Slide 43: Wealth Management & Insurance
In Private Banking, continued good activity levels and business growth. Net new money YTD: EUR 3,300 million Wealth In SAM, volumes are back to speed (up +10% YoY), both by market movement and by positive Management net sales (EUR 1,400 million YTD) & Insurance In Insurance, Gross Written Premiums +
Slide 44: Appendix
Appendix 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 44
Slide 45: Well-funded, diversified, prudent and highly liquid balance sheet
Well-funded, diversified, prudent and highly liquid balance sheet (large % contribution from customer deposits), actively reinforced already strong LCR ratios following covid-19 crisis Liquidity Balance Sheet EUR bn, Mar-21 Liquidity Coverage Net Stable Funding 1,246 1,246 Ratio (LCR) Ratio (NSFR) L
Slide 46: Conservative and decentralized liquidity and funding model
Conservative and decentralized liquidity and funding model EUR 8.4 bn1 issued in public markets in Q1’21 Very manageable maturity profile EUR bn, Mar-21 EUR bn, Mar-21 48.4 5.2 Spain2 2.1 9.1 8.1 7.4 8.5 3.3 SCF 3.7 6.2 3.9 2.5 2.6 1.5 1.7 1.0 2021 2022 2023 2024 2025 2026+ 1.9 0.5 10.7 12.2 1.7 UK
Slide 47: Interest rate risk hedging
Interest rate risk hedging Mostly positive interest rate sensitivity ALCO portfolios reflect our geographic diversification Net interest income sensitivity* to a +/-100 bp parallel shift Distribution of ALCO portfolios by country EUR mn, Feb-21 %, Mar-21 Other Spain, +100 bps -100 bps Chile, S.Am.,
Slide 48: Issuances YTD against funding plan
Issuances YTD against funding plan 2021 Funding plan and issuances EUR bn, Mar-21 Snr Non-Preferred + Snr Hybrids Covered Bonds TOTAL Plan Issued Plan Issued Plan Issued Plan Issued 1 Santander S.A 8-10 4.6 2-3 2.3 - - 10-13 6.9 SCF 3-4 1.0 - - 0-1 - 3-5 1.0 UK 2.5-3.5 1.7 - - - - 2.5-3.5 1.7 SHUSA
Slide 49: Capital levels exceed minimum regulatory requirements
Santander’s capital levels, both phased-in and fully loaded, exceed minimum regulatory requirements SREP capital requirements and MDA* Assumed capital requirements (fully loaded) Mar-21 Mar-21 16.16% 15.81% 2.26% T2 >14.5 13.01% +315 bps 1.60% AT1 13.01% +280 bps 2.37% 2.00% T2 T2 2.38% 1.55% AT1 T2
Slide 50: TLAC ratios for the Resolution Group headed by Banco Santander, S.A.
TLAC ratios for the Resolution Group headed by Banco Santander, S.A. TLAC Ratio EUR mn 30 June 2020 30 September 2020 31 December 2020 31 March 2021 E Own Funds 86,335 86,191 86,836 86,634 of which: Common Equity Tier 1 (CET1) capital 70,746 70,829 69,451 69,349 of which: Additonal Tier 1 (AT1) capi
Slide 51: Appendix
Appendix 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 51
Slide 52: Yield on loans (%)
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 11
Slide 53: Cost of deposits (%)
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 3.54 3
Slide 54: Appendix
Appendix 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 54
Slide 55: 86% of moratoria has expired, with only 5% in stage 3
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 Main units Active moratoria as of 31st March 21, EUR bn Active moratoria as of 31st March 21, EUR bn Mortgages 9 9 69% 6 98% 2 Consu
Slide 56: Breakdown of moratoria by segments, regions and main countries
Breakdown of moratoria by segments, regions and main countries: credit quality of expired moratoria remains solid Expired Total Expired as % EUR bn, 31-Mar-21 moratoria % loan book (*) o/w: expired of Total % Stage 1 % Stage 2 % Stage 3 Total Group 112 12% 96 86% 75% 20% 5% Detail by segments Mortga
Slide 57: Stage coverage
Stage coverage Exposure ¹ Coverage Mar-21 Dec-20 Sep-20 Jun-20 Mar-20 Mar-21 Dec-20 Sep-20 Jun-20 Mar-20 Stage 1 885 864 862 878 891 0.5% 0.5% 0.6% 0.6% 0.6% Stage 2 70 69 60 61 53 8.1% 8.5% 8.8% 7.7% 8.2% Stage 3 32 32 31 33 33 42.5% 43.4% 43.3% 41.1% 40.8% (1) Exposure subject to impairment in EUR
Slide 58: NPL ratio (%)
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 2.5
Slide 59: Coverage ratio (%)
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 181.4 253.1 228.8 210.4 183.2
Slide 60: Credit impaired loans and loan-loss allowances by operating area
Credit impaired loans and loan-loss allowances. Breakdown by operating areas. March 2021 Credit impaired loans Loan-loss allowances DCB, 8.1% DCB, 12.2% Other South America, 0.5% Argentina, 0.3% Other South America, 0.7% Chile, 6.6% Spain, 27.0% Argentina, 1.0% Spain, 42.4% Chile, 5.7% Brazil, 10.3%
Slide 61: Cost of credit (%)
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 2.6
Slide 62: Appendix
Appendix 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 62
Slide 63: Santander Responsible Banking goals
Santander Responsible Banking goals We are building a more Responsible Bank aligned with our commitments 2018 2019 2020 2021 2025 Top 10 company to work for1 4 5 6 6 Women on the board of directors 33 33% 40% 40% 40%-60% Women in senior leadership positions2 20% 20 23% 23.7% 30% Equal pay gap3 3% 2%
Slide 64: Appendix
Appendix 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 64
Slide 65: Santander Group (EUR mn)
SANTANDER GROUP (EUR mn) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Net interest income 8,487 7,715 7,773 8,019 7,956 Net fee income 2,853 2,283 2,423 2,456 2,548 Gains (losses) on financial transactions and other 474 706 891 520 886 Total income 11,814 10,704 11,087 10,995 11,390 Operating expenses (5,577) (5,0
Slide 66: Santander Group (Constant EUR mn)
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 (5,
Slide 67: Europe (EUR mn)
Europe (EUR mn) 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) (
Slide 68: Europe (Constant EUR mn)
Europe (Constant EUR mn) 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)
Slide 69: Spain (EUR mn)
Spain (EUR mn) 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 operatin
Slide 70: United Kingdom (EUR mn)
United Kingdom (EUR mn) 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 operati
Slide 71: United Kingdom (GBP mn)
United Kingdom (GBP mn) 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 2
Slide 72: Portugal (EUR mn)
Portugal (EUR mn) 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 16
Slide 73: Poland (EUR mn)
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 23
Slide 74: Poland (PLN mn)
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) Net
Slide 75: Other Europe (EUR mn)
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 (1
Slide 76: Other Europe (Constant EUR mn)
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 operating
Slide 77: North America (EUR mn)
North America (EUR mn) 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) (1,21
Slide 78: North America (Constant EUR mn)
North America (Constant EUR mn) 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) (1,1
Slide 79: United States (EUR mn)
United States (EUR mn) 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)
Slide 80: United States (USD mn)
United States (USD mn) 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)
Slide 81: Mexico (EUR mn)
Mexico (EUR mn) 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
Slide 82: Mexico (MXN mn)
Mexico (MXN mn) 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)
Slide 83: Other North America (EUR mn)
Other North America (EUR mn) 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 loa
Slide 84: Other North America (Constant EUR mn)
Other North America (Constant EUR mn) 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
Slide 85: South America (EUR mn)
South America (EUR mn) 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) (1,33
Slide 86: South America (Constant EUR mn)
South America (Constant EUR mn) 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
Slide 87: Brazil (EUR mn)
Brazil (EUR mn) 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 o
Slide 88: Brazil (BRL mn)
Brazil (BRL mn) 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) (4,92
Slide 89: Chile (EUR mn)
Chile (EUR mn) 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 3
Slide 90: Chile (CLP mn)
Chile (CLP mn) 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 Operati
Slide 91: Argentina (EUR mn)
Argentina (EUR mn) 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 15
Slide 92: Argentina (ARS mn)
Argentina (ARS mn) 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
Slide 93: Other South America (EUR mn)
Other South America (EUR mn) 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
Slide 94: Other South America (Constant EUR mn)
Other South America (Constant EUR mn) 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
Slide 95: Digital Consumer Bank (EUR mn)
Digital Consumer Bank (EUR mn) 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) (
Slide 96: Digital Consumer Bank (Constant EUR mn)
Digital Consumer Bank (Constant EUR mn) 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
Slide 97: Corporate Centre (EUR mn)
Corporate Centre (EUR mn) 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
Slide 98: Retail Banking (EUR mn)
Retail Banking (EUR mn) 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) (
Slide 99: Retail Banking (Constant EUR mn)
Retail Banking (Constant EUR mn) 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) (
Slide 100: Corporate & Investment Banking (EUR mn)
Corporate & Investment Banking (EUR mn) 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
Slide 101: Corporate & Investment Banking (Constant EUR mn)
Corporate & Investment Banking (Constant EUR mn) 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) (
Slide 102: Wealth Management & Insurance (EUR mn)
Wealth Management & Insurance (EUR mn) 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 ope
Slide 103: Wealth Management & Insurance (Constant EUR mn)
Wealth Management & Insurance (Constant EUR mn) 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)
Slide 104: PagoNxt (EUR mn)
PagoNxt (EUR mn) 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) (
Slide 105: PagoNxt (Constant EUR mn)
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) (3
Slide 106: Appendix
Appendix 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 106
Slide 107: Glossary - Acronyms
Glossary - Acronyms ❑ AuM: Assets under Management ❑ LLPs: Loan-loss provisions ❑ RoRWA: Return on risk-weighted assets ❑ BFG: Deposit Guarantee Fund in Poland ❑ M/LT: Medium- and long-term ❑ RoTE: Return on tangible equity ❑ bn: Billion ❑ mn: million ❑ RWA: Risk-weighted assets ❑ CET1: Common equit
Slide 108: Glossary - Definitions
Glossary - Definitions PROFITABILITY AND EFFICIENCY ✓ RoTE: Return on tangible capital: Group attributable profit / average of: net equity (excluding minority interests) – intangible assets (including goodwill) ✓ RoRWA: Return on risk-weighted assets: consolidated profit / average risk-weighted asse
Slide 109: 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: