Santander, Spain’s largest bank, is set to expand its corporate banking presence in the United States.
Speaking Thursday (Nov. 9) at the Reuters NEXT conference in New York, Banco Santander Executive Chair Ana Botin said the bank’s strategy will focus on renewable finance, auto lending and wealth management as it aims to outperform its competitors in a normalized interest-rate environment, Reuters reported Thursday.
Despite recent obstacles, Santander reported a 20% increase in quarterly net profits, driven by a strong performance in its home market and rising interest rates, according to the report.
The bank has ambitious plans to double its business in U.S. investment banking, despite challenges such as loan losses, higher funding costs and scaling up expenses, the report said. In the third quarter, Santander’s net profit in the U.S. fell 50%, while its net interest income dropped by 15%. Provisions also rose by 49% compared to the same period last year.
To support its growth plans, Santander is recruiting around 150 bankers primarily in the U.S. from Credit Suisse, per the report. This move demonstrates the bank’s commitment to expanding its operations in the world’s largest economy.
In addition to its expansion efforts, Botin called for a level playing field between banks and big tech companies like Apple, particularly in the area of payments, according to the report. She emphasized the importance of fair competition, urging for equal treatment in terms of taxes and transparency.
Santander is also investing in its payments business, PagoNxt, to compete with players like Apple Pay, per the report. While the payments sector has been a reliable source of income for banks, investors have become more cautious due to stretched valuations.
In one recent development in the U.S., LendingClub said in September that it has tapped Santander Consumer as the primary loan servicer for its auto refinance portfolio. Aside from onboarding LendingClub’s new originations, Santander Consumer has converted all existing portfolios from the existing servicers, LendingClub said at the time.
Five months earlier, in April, Santander Bank N.A. partnered with DailyPay to offer an on-demand pay benefit. With this collaboration, Santander’s Commercial Banking clients in the U.S. can provide their employees with immediate access to their pay as they earn it.