Banco Santander Approves Board Changes, Goodwill Impairment of EUR600 Million
November 29 2017 - 2:08AM
Dow Jones News
By Anthony Shevlin
Banco Santander SA (SAN.MC) said late Tuesday that it has
approved changes to its executive board, as well as a goodwill
impairment of 600 million euros ($712.9 million) that will be
recognized in its fourth-quarter results.
Following a meeting of its board of directors in Brazil, the
Spanish bank said that it has appointed Ramiro Mato as independent
director. He will join the board's executive committee, as well as
the audit and risk supervision, regulation and compliance
committees.
Banco Santander said that Matias Rodriguez Inciarte and Isabel
Tocino will both leave the board of directors to take on new
roles.
Mr. Rodriguez Inciarte will become the chairman of Santander
universities, replacing Rodrigo Echenique Gordillo, and also vice
chairman of universia, reporting directly to Banco Santander
Executive Chairman Ana Botin.
Mrs. Tocino will assume the roles of vice chairman of the
Santander Spain board and chairman of Banco Pastor, an entity that
became part of Santander Group earlier this year following the
acquisition of Banco Popular SA (POPULAR.BO).
Mrs. Botin said that the appointment of Mr. Mato to the board
will add value thanks to his "broad finance and international
banking-management experience."
Banco Santander added that, in accordance with its annual
engagement plan and accounting standards, it has carried out a
review of its goodwill. The bank said that an impairment will be
taken for approximately EUR600 million, of which EUR500 million are
a result of the review of the group's investment in Santander
Consumer USA Holdings Inc (SC). The impairment is driven by a
reduction in the company's earnings relative to prior years.
Banco Santander said that the impairment will be recognized in
its consolidated results for the fourth quarter of 2017 but that it
will not impact on the group's common equity Tier 1 capital ratio
as goodwill is excluded from its calculation. CET1 is a key measure
of capital strength for banks. The bank said that its fully loaded
CET1 at the close of the third quarter was 10.8%.
The Spanish bank added that it has updated the public
information regarding two previously announced transactions that
will have an impact in the forth quarter. The bank and its partners
closed the sale of 100% of Allfunds Bank SA's share capital, which
forms part of the previously reached agreement to acquire the 50%
of Santander Asset Management that the bank doesn't own from
Warburg Pincus LLC and General Atlantic LLC.
Banco Santander said that the combined effect of the two
transactions will consume nine basis points of capital, including
the effect of the EUR300 million net gain obtained from selling the
investment in Allfunds Bank.
The company reiterated its goal to increase both dividend per
share and earnings per share in 2017 and 2018, the latter by double
digits.
Write to Anthony Shevlin at anthony.shevlin@dowjones.com
(END) Dow Jones Newswires
November 29, 2017 01:53 ET (06:53 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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