Brazil In 'A Great Situation' Says Banco Santander Chief

by Mike Godfrey, Tax-News.com, Washington

08 February 2008

Speaking at the bank's 2007 annual results presentation on Thursday, Banco Santander Chairman, Emilio Botín announced that attributable profit had risen 19.3% to EUR 9,060 million in 2007, making Santander the
fifth financial institution in the world in terms of profit.

He went on to reveal that the Board of Directors has agreed, pending approval by the General Shareholders’ Meeting, to put in place a 25% increase in the dividend per share compared to 2006. The final dividend, which will be paid on May 1st, will amount to EUR 0.28, raising the total dividend charged against 2007 results to EUR 0.65.

Regarding the outlook for 2008, the Banco Santander Chairman suggested that:

“The turbulence in international financial markets and its impact on the main world economies has accelerated the adjustment in the Spanish economy. We are in a phase of lower growth. After 14 years of uninterrupted growth, we have entered a phase of deceleration.”

Nonetheless, speaking with regard to the bank's Latin American operations, Botín observed that:

“We have an exceptional franchise and considerable experience. The countries there are very resilient.”

He noted that Brazil, Mexico and Chile represent 78% of the region’s GDP, and emphasized that Brazil “is in a great situation. I can say with certainty that if this crisis doesn’t last more than a year, Brazil won’t even notice it.”

Mexico, he pointed out, “for the first time has the right institutions and the right policies to respond.”

The Chilean economy, meanwhile, will grow by 5%.

He stated that:

“Overall, we expect a good year in 2008 in Latin America, with an increase in banking intermediation and, in our case, growth in dollar net profit of above 20%.”

It also emerged on Thursday that Banco Santander has purchased ABN Amro's global clients business from the Royal Bank of Scotland Group, as part of a shared acquisition of ABN Amro.

The sale is reported to have set Santander back in the region of EUR750 million, and it is thought to be considering the acquisition of ABN Amro's Brazilian asset management business in addition to this.

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