Going forward all the bank’s activities across all markets will be consolidated under five global areas: Payments, Corporate & Investment Banking, and Wealth Management & Insurance, and the two new global businesses, Retail & Commercial, and Digital Consumer Bank.
This will allow the bank to improve its customer service and simplify its business further, while helping achieve the strategic goals outlined at its Investor Day in February, which remain unchanged.
These five areas will become the bank’s primary reporting segments from January 2024.
Madrid, 18 September 2023.
Banco Santander is consolidating its retail & commercial and consumer activities across all markets under two new global businesses: Retail & Commercial and Digital Consumer Bank. The changes align these businesses with Santander’s current, global model in Corporate & Investment Banking, Wealth Management & Insurance and Payments, helping the bank achieve the strategic goals outlined at its Investor Day in February, including: adding 40 million customers by 2025, increasing return on tangible equity to 15-17%, and achieving double-digit average annual growth in tangible net asset value per share plus dividend per share through the cycle.
Following the changes, all of the bank’s activities will be aligned under five global business areas1:
- Retail & Commercial: a new business area which combines all the bank’s retail and business banking globally, to be led by Daniel Barriuso.
- Digital Consumer Bank: all consumer finance activities worldwide, to be led by José Luis de Mora.
- Payments: PagoNxt (led by Javier San Félix) and Global Cards (led by Matías Sánchez).
- Corporate & Investment Banking: already a global business, led by José M. Linares.
- Wealth Management & Insurance: already a global business, led by Víctor Matarranz.
Santander’s executive chair, Ana Botín, said: “Today we are announcing a crucial step in aligning our operating model in retail & commercial and consumer banking to our strategy. We know from our progress since we first defined our strategy in 2015 that leveraging our unique combination of global scale and local leadership allows us to serve customers better, while delivering profitable growth. We are confident this is the right thing for our customers and will allow us to progress faster, delivering on all targets set out at Investor Day this year, including double digit average annual growth in tangible net asset value plus dividend per share through the cycle.”
In this new model, global heads will define the common business and operating model, which will be based on global platforms; country heads continue to be responsible for managing the business, and regional heads will drive the implementation of the model and convergence across the markets.
The group plans to align the way it reports its financial results to this new model from January 2024, as it becomes implemented, with the five global businesses becoming the new primary segments for the group. To facilitate year-on-year comparisons and analysis, the bank will publish information adapted to the new segments ahead of 2023 full-year results announcement, which will take place on 31 January 2024. The group will continue to report all country and region-specific data, although they will become secondary segments.
The group’s financial targets outlined in February remain unchanged, including achieving a return on tangible equity (RoTE) of 15-17% in 2023-2025 and an efficiency ratio of c.42% by 2025; maintaining a fully-loaded CET1 above 12%; delivering double-digit average annual growth in tangible net asset value (TNAV) per share plus dividend per share through the cycle. The bank remains on track to meet its 2023 targets, including double-digit revenue growth; RoTE above 15%; cost-to-income ratio of 44-45%; fully-loaded CET1 above 12%, and cost of risk below 1.2%.
