Santander Portugal’s profits in the first nine months of the year registered a drop of 6.4% compared to the same period last year, falling from 778.1 to 728.2 million euros, the bank reported this Wednesday.
In a statement, the institution led by Pedro Castro Almeida explains that the decline in results was due to the decline in the financial margin (difference between the interest charged on credit to customers and the interest paid on deposits), which, due to the decline and stabilization of interest rates, now generates less revenue. This drop, the bank emphasizes, continues “to reflect the cycle of decreasing interest rates implemented by the European Central Bank (ECB), which resulted in a drop in the deposit rate by 150 basis points, to 2%, in turn transmitted to the credit portfolio”, which is still mostly indexed to a variable rate.
In the first nine months of the year there continues to be an increase in credit granted across all lines. The bank reported 52 billion in credit, in total, with a growth of 7.3% in the individual segment, to 26.9 billion euros, of which 24.6 billion in the housing segment, which rose 7.4%. Consumer and corporate credit also rose 9.3% and 10.7% respectively.
In housing credit, Santander Portugal notes that it has already granted “around 768 million euros under public guarantee lines”, reinforcing its role in supporting young people looking to buy a home. This value corresponds to the total credit granted to young people (including the guarantee amount, which amounts to 10% to 15% of the total credit and acts as a down payment). From the level allocated by the State to the banks in terms of guarantee, Santander received 259.25 million euros, a sum that has not yet been exhausted.
As far as fundraising is concerned, there was an increase of 6.5%, to 48.9 billion euros, with off-balance sheet resources (such as investment funds and insurance) seeing the greatest growth. In deposits, growth was 5.6%, to 39 billion euros, and in off-balance sheet resources the increase was 9.9% to 9.5 billion euros, with investment funds recording an increase of 16.8%, to 5.4 billion, and insurance and other resources growing 1.9%, to 4 billion euros.
Commissions charged to customers increased by 5.9%, to 365 million euros, an increase that the bank attributes to the increase in the customer base.
On the other side of the scale, operating costs fell 0.4%, to 388.4 million euros, which is due to the offer through digital channels and simplification of processes.
The bank continues to score when it comes to profitability, with a ROTE (return on tangible capital) of 32% and an efficiency ratio of 27.3%.
This week, at the Money Summit conference, Pedro Castro Almeida stated that there is no reason for the State to apply a new tax to banks (as the additional solidarity tax was unconstitutional). Other bankers defended the same at this event. A debate that occurs because the Minister of Finance, Joaquim Miranda Sarmento, ended the tax created during the pandemic but stated that he would revisit the banking tax regime.
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