Ana Botín, group executive chairman of Banco Santander, is focusing on the customer, a strategy designed to increase profits as well as return on tangible equity at the bank,
a lengthy Bloomberg profile
reported.
Ana succeeded her father, Emilio, who died in 2014. Emilio was a dealmaker who “transformed Santander from a regional lender into a global player through scores of acquisitions over 28 years,” the article said. “Virtually nothing will shape Botín’s tenure more than how she reckons with her father’s legacy,” the Bloomberg profile noted.
Last January, Ana cut the dividend paid to Satander stockholder from 0.6 euros per share annually to 0.2 euros in an effort to increase the bank’s capital base. She removed many of her father’s top executives and put her own people in place. In August, she declined to increase Santander’s bid for HSBC’s Brazilian division, “a deal one former senior Santander executive says her father never would have let slip away,” the article said.
Ana must contend with “some big challenges her father left behind,” the Bloomberg report noted. One challenge is that the bank needs more capital; “Emilio favored running the bank with a thin capital buffer instead of diluting his stockholders by issuing more equity,” the article said.
Other problems involve Santander Holdings USA, which Emilio opened in the mid-2000s, the report noted. The U.S. unit flunked the Federal Reserve’s stress tests for 2013 and 2014. Santander Consumer USA, an auto loan maker, has been accused of violating fair-lending laws. Sovereign Bank, acquired in 2008 and rebranded as Santander Bank, has had to replace outdated IT systems. The U.S., the Bloomberg article said,
is “the one market where Emilio’s sure hand may have failed him.”
Another challenge comes from Banco Santander Brasil, which has seen profits decline because of economic recession in Brazil, the article said. (Source: Bloomberg, Nov. 22, 2015.)
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