Banco Santander will restructure its business in five global areas

2023-09-19 17:43:40

Santander Bank has made the decision to restructure its retail and commercial banking and consumer financing segments, and to divide its entire business into five global areas, as indicated this past Monday by the entity itself.

Until now, Santander Bank had established a double division of its business at a local and global level. Thus, its main segments were Europe, North America, South America and Digital Consumer Bank, and the secondary segments were commercial banking, investment banking, wealth management and payments.

However, this division presented some complexity. Thus, the Digital Consumer Bank segment encompassed the consumer financing business in Europe, but not in North America, while the retail banking activity through Openbank was part of Digital Consumer Bank.

Thanks to this restructuring, Banco Santander’s business will be divided from January 2024 into five global areas, namely Retail & Commercial, Digital Consumer Bank, Payments, Corporate & Investment Banking and Wealth Management & Insurance.

Of all these new segments, two are already global businesses, specifically the investment banking area, led by José Linares, and asset management, led by Víctor Matarranz.

Retail & Commercial will cover the entire retail and commercial banking business of the Group companies, and will be headed by Daniel Barriuso, while Digital Consumer Bank will encompass the entire consumer financing business worldwide, and will be headed by José Luis de Mora. .

Barriuso is senior executive vice president of Banco Santander, and until now he was Group Transformation Director. He was previously Global Head of Cybersecurity (CISO) and Bank Fraud Prevention for almost seven years. He has three decades of experience in the banking, energy and technology sectors. Before joining Banco Santander, he held various management positions at BP, Credit Suisse, and ABN Amro.

For his part, De Mora is senior executive vice president, and until now held the position of CEO of Santander Consumer Finance. He will become the global head of Digital Consumer Bank and also Corporate Development and Financial Planning of the Group. After working at Kleinwort Benson and Merrill Lynch in London, De Mora joined Banco Santander in 2003, and has been involved in the entity’s main acquisitions of different banks in Europe and America.

The Payments segment remains a global business divided into two segments: PagoNxt, led by Javier San Félix, and Global Cards, led by Matías Sánchez.

Based on the new structure, global managers will establish the common operating and business model, and country managers will lead business management.

Banco Santander will adapt the reporting of financial results to the new model starting in January 2024, when it becomes fully operational.

In the words of Ana Botín, the president of Banco Santander, «Following the progress since we launched our strategy in 2015, we know that by leveraging our unique combination of global scale and local leadership we better serve clients and grow profitably. “We are convinced that this will be positive for clients and will also allow us to progress more quickly and meet all the objectives we set for ourselves at this year’s Investor Day.”

Santander Bank expects that, between 2023 and 2025, its CET1 capital ratio will exceed 12%, that the return on tangible capital (RoTE) will be between 15 and 17%, that its payout to shareholders will reach 50% of profits, including share buybacks and dividends, and that the efficiency ratio is set at 42% by 2025.

Banco Santander will offer information adapted to the new segments before the publication of the 2023 results, scheduled for January 31, 2024. Likewise, the entity will continue to present detailed information on the countries and regions where it operates, although it will do so as secondary segments.