SHARE
COPY LINK

BANK

Santander profits jump with economic recovery

The eurozone's biggest bank, Spain's Santander, said on Tuesday its first quarter net profit jumped 32 percent as strengthening economic recovery in its home market boosted revenue.

Santander profits jump with economic recovery
The entrance to Santander Bank's financial city in Madrid. Photo: Javier Soriano / AFP

The bank reported a net profit of €1.72 billion ($1.87 billion) in the first three months of the year, up from €1.3 billion during the same period last year.

Net profit in Spain — which posted its first full year of economic growth last year since the 2008 bursting of the property bubble — surged 42 percent in the first quarter to €357 million.

The bank said its bottom line in Spain was boosted by better lending income and fewer provisions against losses on bad loans.

Net loans in Spain were up 0.2 percent in the first three months of 2014 over the same period last year. Loans also increased slightly from the fourth quarter of last year.

The Spanish economy, the eurozone's fourth-largest, fell into a prolonged slump when the property bubble burst, leaving thousands of labourers out of work and creating an aftershock that claimed millions more jobs across the country.

But the economy is in the midst of an accelerating economic recovery due to a rise in private consumption and higher business investment.

Prime Minister Mariano Rajoy on Monday said the government expects the country's economy will expand by 2.9 percent this year, up from a previous estimate of 2.4 percent growth.

Spain's economy expanded by 1.4 percent in 2014.

Among Santander's main banking units, only Chile posted lower first quarter net profit, dropping 11 percent to €109 million.

In Britain, where Santander is one of the leading finance groups, profits rose 14 percent over the year to €477 million.

In key emerging market Brazil, profits rose by 41 percent to €516 million.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

ECONOMY

Spain’s middle-class youngsters the most likely to end up poor across all EU

Spain leads the ranking of EU countries with the highest risk of young people ending up in poverty as adults, despite coming from families without economic difficulties.

Spain is the fourth EU country with the highest inherited poverty
Spain is EU country with most middle-class young people who end up poor. Photo: Jaime ALEKOS / AFP

Spain is also the fourth EU country with the highest rate of inherited poverty risk, according to Eurostat, the EU Statistical Office.

Data on intergenerational poverty indicates that there is a correlation between the financial situation of the household you grew up in and the risk of being poor when you reach adulthood and in Spain, there is a strong link. 

The latest statistics available from 2019 show that the at-risk-of-poverty rate for the EU was 23 percent among adults aged 25 to 59 who grew up in a poor financial situation at home when they were 14 years old. This is 9.6 percentage points more than those who come from families without financial problems (13.4 percent). 

READ ALSO: Spain’s inflation soars to 29-year high

How the situation in Spain compares with the EU

Spain has become the EU country with the highest risk of poverty among adults who grew up in families with a good financial situation  – 16.6 percent.

This was followed by Latvia with 16 percent and Italy with 15.9 percent.

That statistics also show the countries where it is less likely to be poor after growing up in households without economic difficulties. These include the Czech Republic (5.9 percent), Slovakia (7.9 percent) and Finland (8.5 percent).

The overall poverty rate in the EU decreased by 0.1 percentage points between 2011 (13.5 percent) and 2019 (13.4 percent), but the largest increases were seen in Denmark (1.9 points more), Portugal (1.8 points), the Netherlands (1.7 points) and Spain (1.2 points).  

On the other hand, the biggest decreases in the poverty rate were seen in Croatia (-4 percent), Lithuania (-3.6 percent), Slovakia (-3.5 percent) and Ireland (-3.2 percent).

READ ALSO: Spain’s government feels heat as economic recovery lags

Inherited poverty

The stats revealed that Spain was also the fourth country with the highest rate of inherited poverty risk (30 percent), only behind Bulgaria (40.1 percent), Romania (32.7 percent) and Italy (30.7 percent).

This means that children of poor parents in Spain are also likely to be poor in adulthood. 

The countries with the lowest rate of inherited poverty risk were the Czech Republic (10.2 percent), Denmark (10.3 percent) and Finland (10.5 percent).

The average risk-of-poverty rate for the EU increased by 2.5 percentage points between 2011 (20.5 percent) and 2019 (23 percent), with the largest increases seen in Bulgaria (6 points more), Slovakia and Romania (4.3 points), Italy (4.2 points) and Spain (4.1 points).

The biggest drops were seen in Latvia (-8.5 points), Estonia (-8.0 points) and Croatia (-2.3 points). 

The largest gaps in people at risk of poverty when they reach adulthood were in Bulgaria (27.6 percentage points more among those who belong to families with a poor economic situation as teenagers compared to those who grew up in wealthy households), Romania (17.1), Italy (14.8), Greece (13.5) and Spain (13.4).

SHOW COMMENTS