2 minutes - Source: CNBC
A Banco Santander office in Madrid, Spain.
Spain’s Santander on Tuesday forecast an improvement of core profits for 2020, citing better customer behavior in expired loan payments and more cost savings in Europe after it swung back to the black in the third quarter.
While statutory net profit trebled in the third quarter compared to a year ago, however, on underlying terms the bank’s profit fell 18% in the same period to 1.75 billion euros ($2.07 billion) due to more coronaviurs related provisions.
Analysts polled by Reuters expected an operating profit of 1.06 billion euro.
Banks across Europe are struggling to cope with record low interest rates and the economic downturn sparked by the coronavirus pandemic is forcing lenders to focus on further cutting costs.
Higher efficiency gains and better customer behavior however led the bank to forecast an underlying profit of around 5 billion euros for this year.
“The recovery of our business is progressing well, and the third quarter was significantly stronger than the second. Revenues increased 18% in constant euros as activity returned close to pre-pandemic levels,” Executive Chairman Ana Botin said in a bank’s statement.
In the second quarter, the euro zone’s third-biggest lender in terms of market value had reported a record net loss of 11.1 billion euros on COVID-19 related writedowns.
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