JANUARY - JUNE FINANCIAL REPORT 2015
HIGHLIGHTS OF THE PERIOD
Profit growth and improved profitability
• Second quarter ordinary attributable profit of EUR 1,709 million, with good performance of the income statement's most recurring lines.
• First half ordinary attributable profit of EUR 3,426 million, 24% more than the same period of 2014:
- Positive impact of exchange rates.
- Commercial revenues continued to increase, mainly net interest income.
- Stable costs in real terms and on a like-for-like basis.
- Improved cost of credit (1.32% as against 1.56% in June 2014).
• Higher profitability year-on-year:
- Efficiency ratio of 46.9% (0.4 p.p. better year-on-year).
- RoTE rose by 0.6 p.p. year-on-year to 11.5%.
The growth in volumes reflects the strategy followed in segments, products and countries
• Positive impact (4/5 p.p.) of exchange rates year-on-year.
• Lending increased 7% y-o-y in constant euros, with growth in all countries, except for Portugal and Spain. Perimeter impact: +2 p.p.
• Funds rose 8% in constant euros, with growth in all countries. Of note were Latin America, Poland and US.
• Solid funding structure and liquidity continued. Net loan-to-deposit ratio of 116%.
(*) Loans and deposits excluding repos
High solvency and enhanced Group credit quality
• CET1 ratio fully loaded of 9.8% and total capital ratio 12.4%, up 16 b.p. and 34 b.p., respectively, in the second quarter.
• Ordinary generation of 22 b.p. of core capital in the second quarter.
• Leverage ratio (fully loaded) of 4.8%.
• Non-performing loan (NPL) entries, isolating the perimeter and exchange rate effects, were 34% lower than in the first half of 2014.
• The NPL ratio continued to improve, notably in the second quarter in Spain, Poland, Santander Consumer Finance and the UK.
Advances in the commercial transformation programme and in the multi-channel distribution model
• Transforming our business model into one that is increasingly simple, personal and fair continued.
• The NEO CRM tool to improve productivity and customer satisfaction continued to be extended.
• Launch of differentiated value offers in various countries to improve engagement and long-term relations with individual customers, including the 1|2|3 account in Spain and Portugal.
• Of note among the specialized solutions for companies was further geographic expansion and new proposals of Santander Advance, already present in eight countries, and Santander Trade.
• Further progress in strengthening multi-channels with better websites, new developments for mobile phones, the Santander Watch app, etc.
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