Straight and narrow

25 January 2017 By George Hay Follow @gfhay

The Spanish bank’s top and bottom lines grew in the fourth quarter, despite a slowdown at home. Santander’s 10.6 pct capital ratio is improving, but looks light versus EU peers. Limited resources at least discourage it from mis-steps like buying smaller rival Banco Popular.

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Santander on Jan. 25 reported underlying pre-tax profit for the fourth quarter of 2016 of 2.7 billion euros, compared to 2.2 billion euros in the fourth quarter of 2015.

Net interest income was 8.1 billion euros, the highest level since the second quarter of 2015, lifting gross income including fees to 11.1 billion euros, compared to 10.9 billion euros in the fourth quarter of 2015.

Attributable profit for the whole of 2016 originating from Spain increased 5 percent to 1 billion euros, while in Latin America it grew 6 percent to 3.4 billion euros.

Attributable profit from the U.S. business fell 42 percent to 395 million euros, while the contribution from the United Kingdom fell 15 percent to 1.7 billion euros.

Santander's fully loaded core Tier 1 capital ratio at the end of 2016 was 10.55 percent, up from 10.05 percent a year earlier.

As of 0930 GMT, Santander shares were trading at 5.4 euros, up 4.5 percent.

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