Santander 2Q Profit Beat Expectations Amid Lower Provisions

   By Xavier Fontdegloria

Banco Santander SA said Wednesday that it swung to a profit in the second quarter of the year as revenue grew and provisions fell, and that it is on track to outperform its profitability target for 2021.

The Spanish lender reported a net profit of 2.07 billion euros ($2.45 billion) from April to June, a reversal from a year earlier, when it posted a EUR11.13 billion net loss due to one-off impairments related to the Covid-19 pandemic. Analysts expected profit of EUR1.77 billion, according to a consensus provided by FactSet.

Provisions for credit losses fell 44% to EUR1.76 billion in the second quarter, the bank said.

Revenue rose to EUR11.31 billion from EUR10.46 billion a year earlier, beating estimates from analysts of EUR11.04 billion. Net interest income--the difference between what banks earn on loans and what they pay clients for deposits--increased to EUR8.24 billion from EUR7.72 billion in 2020's second quarter.

The bank is on track to outperform its profitability target for the year, Banco Santander Executive Chairman Ana Botin said. The lender had targeted an underlying return on tangible equity, a key measure of profitability, of 9% to 10% for fiscal year 2021.

Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com

(END) Dow Jones Newswires

July 28, 2021 01:38 ET (05:38 GMT)

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