Banco Santander, S.a. · BME:SAN
Banco Santander — Investor Presentation (September 2009)
26 slides from Banco Santander's investor presentation, Sep 18, 2009
Slide 1: UK - At The Heart Of Santander's Success
UK -At The Heart Of Santander’s SuccessMadrid, 17thSeptember2009
Slide 2: Disclaimer
Disclaimer 2 Founded in 1857, It is the largest financial group in shares The US Private Securities Litigation Reform documents filed with the US Words such future These factors include, but are not limited to, Santander, S.A. (“Santander”) (SAN.MC, STD.N). and similar expressions are intended to id
Slide 3: Contents
Contents 01. Overview of UK Market Environment 02. Santander UK Performance Drivers S Abbey Brand Bingley”
Slide 4: Santander UK achieving critical mass in core PFS markets through organic growth and acquisitions
4 Santander UK achieving a critical mass in core PFS markets through organic growth and acquisitions
Slide 5: UK business contributes more than 16% of Group revenues
5 10% 10% 3% Branches Retail deposits Abbey A&L B&B in Europe th The UK business contributed more than 16% to Group revenues in H1’09 and by PAT is now ranked 12 While earnings in the UK PFS sector are under pressure in the current environment, Santander UK continues to perform well...
Slide 6: Contribution to PBT change: Santander UK versus sector
7 SAN UK Contribution to PBT change Sector Contribution to PBT change >90% 33% <(10)% (40)% <(20)% (27)% (1) >2% 3% <(35)% (37)% >22% (68)% Funding 2009 onwards improvement The outlook for the economic environment is showing signs of
Slide 7: UK economic outlook: GDP, inflation, interest rates, unemployment
8 Annual GDP Growth ( %, annual average ) 3.0 2.8 2.1 2.2 0.7 0.8 2011(e) 2010 (e) -4.6 2009 (e) 2006* 2005* 2008* 2007* Annual CPI inflation rate (%, annual average) 3.6 2.3 2.1 2.3 2006* 2005* 2008* 2007* 1.7 2011 (e) 1.7 2010 (e) 1.8 2009 (e) Interest Rates (%, annual average) (e) (e) Unemploymen
Slide 8: Contents: The UK business is at the heart of the Group's success
9 Contents The UK business is at the heart of the Group’s success
Slide 9: Managing Santander UK's portfolio of businesses
10 Managing Santander UK’s portfolio of businesses Commercial Divisions Growth opportunities Established Retail Products (Non — Retail) Retail Corporate Banking — Mortgages Developing Portfolio Corporate Savings SGBM Private Banking Global Banking and Markets Private Banking Global Business Manage d
Slide 10: Managing Santander UK's portfolio of businesses: commercial divisions
11 Commercial Divisions Growth opportunities Established Retail Products (Non — Retail) Retail Corporate Banking - Mortgages Developing Portfolio Corporate Savings SGBM Private Banking Global Banking and Markets Private Banking Global Business Manage down / Growth Retail Products Units Reduce exposu
Slide 11: 5th successive year of PBT growth
12 to PBT growth digit double of year 5th successive PFS PBT growth in all businesses and on track deliver
Slide 12: Abbey growth in assets and deposits since 2005
13 (1 ) 674m 25% 218.3 bn 161.4 bn 115m 24% 35.0 bn 32.3 bn 559m 25% 185.3 bn 134.3 bn 31m 38% 19.9 bn 10.9 bn 8m 94% — 13.4 bn 520m 22% 163.4 bn £ 107.1 bn Abbey 2005 (1 ) CAGR _____ Assets _____ Deposits
Slide 13: Managing Santander UK's portfolio of businesses: growth opportunities
Commercial Divisions Growth opportunities Established Retail Products (Non — Retail) Retail Corporate Banking — Mortgages Developing Portfolio Corporate Savings SGBM Private Banking Global Banking and Markets Private Banking Global Business Manage down / Growth Retail Products Units Reduce exposure
Slide 14: Strict cost management
O strict cost management 70% 45% 1,998 1,627 1372 1,352 4,312, 1,364 2004 2005 2006 2007 Abbey A&L"+ 2008 +888 2008 2008 —— Abbey === OE:O! SAN (UK) Q109 Undertying ectine of 2% in 2000 adustfor B88 2,000 109"
Slide 15: Managing Santander UK's portfolio of businesses: risk management
Commercial Divisions Growth opportunities Established Retail Products (Non — Retail) Retail Corporate Banking — Mortgages Developing Portfolio Corporate Savings SGBM Private Banking Global Banking and Markets Private Banking Global Business Manage down / Growth Retail Products Units Reduce exposure
Slide 16: High quality balance sheet lending
17 High quality • Retail comprises with Other 4.6bn sheet lending 53%. 3.8bn and of balance stock mortgage of mortgages the LTV comprised half quality mainly commercial Over high average is UPLs Transparent • Social Corporate 3.4bn deleveraged of 6.3bn other and being contains 13.4bn Corporate asset
Slide 17: Provisions charges in line with expectations
18 Jun’09 Jun’09 Jun’09 Jun’09 SAN UK 0.19% Sector SAN UK Sector Provisions charges in line with expectations
Slide 18: NPLs and coverage; A&L securities portfolio
19 NPLs Coverage 2,294 245 480 67.0% 3,199 45.4% 93% 125.3% 21.5% A&L deleveraged Securities portfolio business being run down taking advantage of market evolution as opportunities appear portfolio performing in line with expectations, consistent with the level of provisions raised at the time of it
Slide 19: Manage down portfolio aligned to commercial strategy
20 Build Manage down portfolio aligned to commercial strategy risk profile consistent with Santander / Abbey collateral offsets c. 2.1bn actively manage down Funding strategy improving loan to deposit ratio
Slide 20: Funding strategy improving loan to deposit ratio
21 June 2009 138% 121 % 115 % 183 % Dec 2007 199% 115 % 103 % 174 % SAN UK _____ Bank A _____ Bank B _____ Bank C Key Comments Acquisitions of A&L and B&B have strengthened the funding of the balance sheet and created a platform for future growth. Focus on driving growth in savings and investments 4
Slide 21: Performance and model differentiation recognised by rating agencies
22 SAN (UK) Sector Average Jun’09 SAN UK Santander UK’s performance and model differentiation continuing to be recognised by rating agencies Jun’08
Slide 22: Credit rating confirmations: Moody's, S&P, Fitch
23 Moody’s S&P Fitch Aa3 AA _____ AA- Aa3 AA _____ AA- August) the ratings confirmations th “Moody’s confirmed the Aa3 senior debt and deposit ratings for Abbey and A&L... reflect Moody’s view supported by the accelerated pace of engagement between Abbey and A&L, as evidenced by rapid developments i
Slide 23: Investor Relations
Investor Relations Abbey House Level 2 Triton Regents London e-mail: ir@abbey.com www.abbey.com Julian Brown Tel. +44 (0) 20 7756 4275 Simon Donovan Tel. +44 (0) 20 7756 4476 +34 91 259 Relations Ciudad Grupo Santander Edificio Pereda, 1st floor de Cantabria, s/n Investor Avda 28660 Boadilla del Mon
Slide 24: Appendix
25 Appendix ntande!
Slide 25: Recent consolidations have left major PFS players in the UK
Recent consolidations have left 5 major PFS players in the UK... 26
Slide 26: ...a dramatic change over the last two years
...a dramatic change over the last two years 27 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: September 18, 2009 By: /s/ J
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