Report of Foreign Issuer (6-k)
September 21 2020 - 4:46PM
Edgar (US Regulatory)
FORM
6-K
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of September, 2020
Commission File Number: 001-12518
Banco Santander, S.A.
(Exact name of registrant as specified in its charter)
Ciudad Grupo
Santander
28660 Boadilla del Monte (Madrid) Spain
(Address of principal executive office)
Indicate by check mark whether
the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form
20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ☐ No ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes ☐ No ☒
Banco Santander, S.A.
TABLE OF CONTENTS
Banco Santander, S.A. (the Bank or Santander), in accordance with the provisions of
the Spanish capital markets regulations, announces:
OTHER RELEVANT INFORMATION
On 2 April 2020, following the recommendation made by the European Central Bank on 27 March 2020 to all European banks under its supervision to preserve
capital by cancelling the payment of dividends against 2019 and 2020 results, Santander announced its decision to withdraw the proposal under Item Two (Application of results obtained during financial year 2019) from the agenda of the ordinary
general shareholders meeting of the Bank to be held on 3 April 2020 on second call.
Today, as announced as inside information in a disclosure sent
to the Spanish National Securities Commission (CNMV), the board of directors of Santander has resolved to call the ordinary general shareholders meeting of the Bank on 26 and 27 October, on first and second call, respectively, and
submitted a new proposal for the application of results obtained during financial year 2019 to that general meeting.
Todays disclosure also
includes the rest of the items on the general shareholders meeting agenda.
In accordance with Royal
Decree-Law 8/2020 of 17 March, regarding urgent extraordinary measures to address the economic and social impact of COVID-19 (Art. 41.3) (Real Decreto- ley
8/2020, de 17 de marzo, de medidas urgentes extraordinarias para hacer frente al impacto económico y social del COVID-19 (Art. 41.3)), the Bank hereby attaches:
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The proposal stated by the board of directors for item one on the agenda of the aforementioned meeting
(Application of results obtained during financial year 2019), as well as the justification for it.
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The communication from the Bank´s auditor in which it is confirmed that the auditor would have not changed
its audit opinion if it had known the new application of results proposal when its audit reports on the individual and consolidated 2019 Financial Reports were signed.
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Boadilla del Monte (Madrid), 21 September 2020
ORDINARY GENERAL SHAREHOLDERS MEETING
OF BANCO SANTANDER, S.A. OCTOBER 2020
Item One.-
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Application of results obtained during financial year 2019.
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RATIONALE SUBMITTED BY THE BOARD OF DIRECTORS OF BANCO SANTANDER, S.A. REGARDING THE PROPOSAL REFERRED TO IN ITEM ONE ON THE AGENDA FOR THE GENERAL
SHAREHOLDERS MEETING CALLED FOR 26 OCTOBER 2020, ON FIRST CALL, AND FOR 27 OCTOBER 2020, ON SECOND CALL
This rationale is submitted in
compliance with the provisions of section 40.6.bis of Royal Decree-Law 8/2020 of 17 March on urgent extraordinary measures to address the economic and social impact of
COVID-19, and is intended to report on the reasons why the board of directors of Banco Santander, S.A. (Banco Santander or the Bank) has chosen to replace the proposed
application of results contained in the notes to the annual accounts corresponding to financial year 2019, which were already approved by the shareholders at the general shareholders meeting held on 3 April 2020, with the proposed
application of results that is submitted for approval by the shareholders under item One on the agenda.
The notes to the Banks annual accounts for
financial year 2019 included a proposed application of results that contemplated the use of an amount of up to 1,761,520,145.69 euros to pay a portion of the 2019 final dividend and the acquisition of bonus share rights that were to be provided to
the shareholders through the Santander Dividendo Elección scrip dividend scheme within the framework of the dividend policy for 2019.
On
27 February 2020 the board of directors resolved to submit the above-described application of results to the shareholders at the general shareholders meeting called to be held on 2 April 2020, on first call, and 3 April 2020, on
second call, under item Two on the agenda (Application of results obtained during Financial Year 2019).
However, on 27 March 2020 the
European Central Bank (ECB) issued a recommendation in which it asked all European credit institutions under its supervision to refrain, at least until 1 October 2020, from paying out dividends with a charge to the results from financial years
2019 and 2020 or to make irrevocable commitments to pay out them, in order to preserve capital (Recommendation I).
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This document is a
translation of an original text in Spanish. In case of any discrepancy between both texts, the Spanish version will prevail.
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1/3
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Taking into account Recommendation I and in line with the Banks mission to help people and businesses
prosper, on 2 April 2020 the board of directors thus decided to cancel the payment of the 2019 final dividend and the dividend policy for 2020, resolving to this end, among other issues, to withdraw from the agenda for said general meeting the
proposal corresponding to item Two (Application of results obtained during Financial Year 2019), deferring the decision on the application of results obtained by the Bank during financial year 2019 to a meeting to be held no later than
31 October 2020. The Bank reported all of the above through the corresponding notice of inside information (información privilegiada) addressed to the CNMV on that same 2 April 2020 and at the general shareholders
meeting held on 3 April 2020, at which it expressly warned that the proposed application of results submitted at the next meeting might differ from the one initially submitted.
Subsequently, on 27 July 2020, the ECB issued a second recommendation to all European credit institutions under its supervision extending the effects of
Recommendation I and asking them to refrain, until 1 January 2021, from paying out dividends from the results for financial years 2019 and 2020 or from entering into irrevocable commitments to pay out them (Recommendation
II).
In compliance with Recommendation II, the board of directors has resolved to replace the initial proposed application of results with the
one being submitted for approval by the shareholders under item One on the agenda, which provides for allocating the entirety of the Banks results for financial year 2019 to increase the Voluntary Reserve, except for the amount used for
payment of the dividend paid prior to the date of the ordinary general meeting and the issuance of Recommendation I.
Despite the fact that, as announced
on 23 March 2020, the Bank meets the capital requirements and the board of directors is comfortable with its capital buffers over regulatory requirements, Recommendation I and Recommendation II are considered to be extremely significant, given
the strength and authority of the ECBs recommendations. This means that it is now appropriate to amend the proposed application of results obtained by the Bank in financial year 2019 and to apply the entire amount of the results pending
application to increasing the Banks Voluntary Reserve.
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This document is a
translation of an original text in Spanish. In case of any discrepancy between both texts, the Spanish version will prevail.
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2/3
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Proposal:
To approve the application of results in the amount of 3,530,216,306.15 euros obtained by the Bank in financial year 2019, to be distributed as follows:
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Euros
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1,661,811,458.20
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to the payment of the dividend already paid prior to the date of the ordinary General Meeting.
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Euros
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1,868,404,847.95
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to increase the Voluntary Reserve.
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This document is a
translation of an original text in Spanish. In case of any discrepancy between both texts, the Spanish version will prevail.
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3/3
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FREE TRANSLATION OF THE ORIGINAL IN SPANISH. IN CASE OF A DISCREPANCY THE SPANISH VERSION PREVAILS
September 21, 2020
Banco Santander, S.A.
Ciudad Financiera Grupo Santander
Avenida de Cantabria s/n
28660 Boadilla del Monte
Madrid, Spain
For the attention of the Board of Directors
Dear Sirs:
The notice of the General Shareholders´ Meeting of Banco Santander, S.A. (the Bank) dated February 28, 2020 includes the following Proposal for
the Application of Profits agreed by the Board of Directors in their meeting of February 27, 2020:
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Millions of euros
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Dividend distributed at December 31*
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1 662
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Complementary dividend (including, if appropriate, cash dividend of shareholders opting to receive
cash in scrip dividend)**
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1 761
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3 423
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Voluntary reserves
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107
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Profit for the year
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3 530
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*
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Recognised in in Shareholders´ equity Interim dividends.
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**
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Assuming % of requests for cash of 20%.
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This proposal is also included in note 4 to the Bank´s standalone and consolidated financial statements for the year ended December 31, 2019, which
were prepared by the Board of Directors of the Bank at the aforementioned meeting and in respect of which on February 28, 2020 we issued our audit report which expressed, in both cases, an unqualified opinion.
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PricewaterhouseCoopers Auditores, S.L., Torre PwC, Pº de la Castellana 259 B, 28046 Madrid, España Tel.: +34 915 684 400
/ +34 902 021 111, Fax: +34 915 685 400, www.pwc.es
R. M. Madrid, hoja
87.250-1, folio 75, tomo 9.267, libro 8.054, sección 3ª Inscrita en el R.O.A.C. con el número S0242 - CIF: B-79 031290
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1
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As indicated in the attached Appendix, the Bank´s Board of Directors, in their meeting of
September 21, 2020 took the decision to replace the agreed initially Proposal for the Application of Profits, once agreed in the Board of Directors in their meeting of April 2, 2020 the deferral of the decision on the aforementioned
initial Proposal for the Application of Profits was agreed for the General Shareholders´ meeting of April 3, 2020:
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Millions of euros
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The payment of the dividend already paid prior to the date of the General Shareholders´
Meeting *
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1 662
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Voluntary reserves
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1 868
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Profit for the year
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3 530
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*
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Recognised in Shareholders´ equity Interim dividends.
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In this context, we confirm that this decision of the Bank´s Board of Directors related to the proposal for the distribution of dividends of 2019 issued
on September 21, 2020 would not have modified our audit opinion expressed in our audit reports dated February 28, 2020 in respect to the standalone and consolidated financial statements of Banco Santander, S.A. for the year ended
December 31, 2019, had we known of the new proposal at the time of our signing such reports.
This document refers exclusively to the decision to
modify the proposal that will be submitted to the General Shareholders´ Meeting for approval in relation to the application of the results. Since February 28, 2020, the date of issuance of our audit reports, we have not performed any
audit procedures on any other matters or in respect of subsequent events that may have occurred since that date.
This letter is issued at the
request of the Bank´s Board of Directors, for the purposes of informing the General Shareholders´ Meeting of Banco Santander, S.A., in accordance with the requirements included in article 40.6 bis of Royal Decree Law 8/2020, of
March 17, on extraordinary and urgent measures to address the economic and social impact of COVID-19 in relation with the Proposal for the Application of Profits of mercantile companies in the context of
the COVID-19 health crisis, and may not be used for any other purpose.
PricewaterhouseCoopers Auditores, S.L.
(Original in Spanish signed by)
Alejandro Esnal Elorrieta
Partner
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PricewaterhouseCoopers Auditores, S.L., Torre PwC, Pº de la Castellana 259 B, 28046 Madrid, España Tel.: +34 915 684 400
/ +34 902 021 111, Fax: +34 915 685 400, www.pwc.es
R. M. Madrid, hoja
87.250-1, folio 75, tomo 9.267, libro 8.054, sección 3ª Inscrita en el R.O.A.C. con el número S0242 - CIF: B-79 031290
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2
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FREE TRANSLATION OF THE
ORIGINAL IN SPANISH
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BANCO SANTANDER, S.A. BOARD OF DIRECTORS RESOLUTION
APPROVED AT ITS 21 SEPTEMBER 2020 MEETING
The Board of Directors of the Bank in its meeting of 21 September 2020 has resolved to call the Ordinary General Shareholders Meeting to be held on
27 October 2020 on second call in the event that, due to failure to reach the required quorum, the meeting cannot be held on first call, which has also been called for 26 October 2020, including the following proposal of application of
results for financial year 2019 as it has been drawn up by the Board of Directors in the same session of 21 September 2020:
To approve the
application of results in the amount of 3,530,216,306.15 euros obtained by the Bank in financial year 2019, to be distributed as follows:
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Euros
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1.661.811.458,20
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To the payment of the dividend already paid prior to the date of the ordinary General Meeting.
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Euros
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1.868.404.847,95
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to increase the Voluntary Reserve.
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Euros
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3.530.216.306,15
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in total.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
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Banco Santander, S.A.
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Date: September 21, 2020
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By:
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/s/ José García Cantera
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Name:
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José García Cantera
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Title:
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Chief Financial Officer
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