Santander’s profit slides as it sets aside $1.7bn Covid bill

Banking giant Santander’s quarterly net profit dived by 82 per cent as it set aside €1.6 billion to cover expected loan losses caused by the Covid-19 pandemic.

The Spanish bank, like its peers, has been taking steps to counter risk as the global economy reels as a result of the coronavirus crisis. The loan-loss provisions rose 80 per cent in the first quarter, though chief executive Jose Antonio Alvarez said they had not been allocated to any specific markets.

The euro zone’s second-largest bank by market value, after BNP Paribas, reported a net profit of €331 million for the first quarter that ended in March.

Excluding extraordinary provisions, which also included €46 million of restructuring costs in Europe, Santander’s underlying quarterly profit rose 1 per cent to €1.98 billion.

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The bank has boosted its lending capacity, in part, by scrapping its final 2019 dividend.

Its diversification overseas, especially in Brazil and Mexico, has helped it cope with tough conditions for lenders in Europe in the years since the financial crisis. – Reuters