Brexit puts pressure on Santander's U.K. unit

Banco Santander SA's U.K. unit has been the Spanish bank's “cash cow,” but the Brexit vote has left the unit facing headwinds,

a

Wall Street Journal

report noted.

The profitable U.K. unit has bolstered the bank as it has dealt with “currency volatility, precarious economic outlooks and [political turbulence] in Latin America, the article said.

Because Santander is a retail bank rather than an investment bank, “it is exposed to the risk of Brexit-triggered slowdowns,” the article said.

Investors are also concerned about the ability of Santander's executive chairman, Ana Botín, to increase profitability and the bank's share price, the


Journal


article said.

“Santander is staring down a prolonged economic recession in Brazil; continued regulatory failings in the U.S. and stubbornly sluggish loan growth and negative interest rates in its home market of Spain,” the article said.

Botín led Santader's U.K. unit before she succeeded her late father as executive chairman, the report noted. “Since then, Santander's market value has declined by about half to around €50 billion ($55.26 billion).” (Source:


Wall Street Journal


, July 12, 2016.)