Spain’s economy to post an expectations - beating 6 percent rise in first-quarter profits shrugged off by Banco Santander. UK profits surged by 15 per cent to £426m, and the bank, which has 13.4 per cent of Britain's existing mortgage stock, again outperformed, accounting for one in five home loans in Britain in the first three months of 2010.
Lending in its home market was what Santander was cautious with. In Spain total loans were down 5 per cent on the year.Addressing the issue of Spain's sovereign debt – downgraded by the ratings agencies amid fears that it could be one of the dominos to fall in the wake of the Greek debt crisis. Because of its location the company does pay a premium of between 10 and 30 basis points when seeking funding compared to what banks rated AA plus by the credit ratings agencies typically pay. However, a Santander spokesman yesterday pointed out that the company's deposits are increasing meaning that it is becoming progressively less reliant on wholesale funding to fuel its lending.
The bank said it opened 276,000 new current accounts and 340,000 Individual Savings Accounts during the cross-tax year campaign while it increased investment sales by 5 per cent. The average loan to value (LTV) on new business completions stood at 63 per cent. Provisions came in at £204m, against £189m the previous year, but unchanged from the previous quarter.
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