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Beating the Spanish recession? Learn the Santander way | Advantage zyaada

In a way more reminiscent of emerging markets though they have not seen many recessions, Banco Santaner continued buying its units in Latin America, having earlier last month bought off Santander in Mexico from Bank of America. It proposes to buy more retail banks in Colombia and Peru as well where it already has a double digit market share. Santander is however staying away from US and European markets as per its stated strategy. It has taken its chances in Germany, however, buying 173 branches for $699 milllion despite operating losses of over $160 m (116 m Euros) in 2009. BofA held a 25% stake in Santander Mexico.

“With the mellifluous tones of the Spanish language making its way through 340 million people globally and more now, there is nothing to stop a growth gene privileged Spain from growing its way out of the Developed World/Recession frame of mind. Tools of Monetary policy can fundamentally change the attractiveness and growth of the Spanish civilisation”

The Banco Santander has a Market Capitalization of 81 Billion, and though I am reading it off their Balance sheet, only 50,000 of their 170,000 employees are in Continental Europe, and 21% of its $3 bn Q1 profits came from Brazil alone, and 24% from home in Spain.

<div style=”float:left;margin-right:5px;”><a href=”; target=”_blank”><img src=”; border=”0″ width=”380″ title=”Residents walk past a Santander bank branch in downtown Montevideo” height=”456″ oncontextmenu=”return false;” ondrag=”return false;” onmousedown=”return false;” alt=”Residents walk past a Santander bank branch in downtown Montevideo June 4, 2010. Uruguay’s government has drafted a bill to relax the country’s bank secrecy rules, responding to global pressure to crack down on tax cheats. REUTERS/Andres Stapff(URUGUAY – Tags: POLITICS BUSINESS)” /></a></div><script type=”text/javascript” src=””></script>Even as AON global stepped out of its core business to pay a 40% premium for people consultants Hewitt to take over the world’s payrolls, Santander has stuck to core business of banking, today announcing the purchase of SEB retail assets in Germany. The 173 branches bring Santander closer to being a full service retail bank in Germany, apart from the recent big strides in the UK. SEB will report $320million in losses in 2010 and another $88million for Santander to absorb in 2011, the company having sold in the middle of the financial closing for March 2010. Santander needs only suffer 10 basis points on the Capital requirements from the acquisition

Santander, which largely managed to dodge the fallout of the U.S. toxic debt crisis due to strict Bank of Spain rules on the kind of financial derivatives Spanish banks can hold, has continued its aggressive acquisition campaign in recent years.

The bank has bid for a network of 318 UK branches being sold by Royal Bank of Scotland (RBS.L) and has had conversations on merging its U.S. operations with M&T (MTB.N), a company official said recently. [ID:nLDE65G0W0]

Santander also announced Jun 24 plans to acquire $3.2 billion of CitiFinancial Auto’s auto loan portfolio and offered around $56 million for part of the capital it does not already own in Puerto Rico Santander Bancorp.

Reuters and NYT did the legwork on the report. I much rather have your opinion too, but the NYT format seems just what the doc ordered, with dealbook making online connects with all the reference material for the report. Do they thank us for that?

After the Spanish inquisition at the World cup, the Spanish team will come home to large scale unemployment, but if the growth imperative lives on with such positive business from Santander and the ilk, Spain is unlikely to disassemble from the recession extending itself into 2012.

Citi and BofA continue the selloff of their internationl businesses to focus on the US assets with the Treasury investment planned to exit by end 2010 only. JP Morgan and Goldman Sachs are likely to continue to focus on the growth fueled Emerging markets and if Santander is allowed to buy assets in the UK and when it decides to grow in Asia, its challenge may be more effective than the French.

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This entry was posted on July 12, 2010 by in Amitonomics, Banking, CRR, Global and tagged .


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