Spanish banking giant Santander has tripled its UK savings deposits to £3bn in the first quarter of 2010 and upped its lending to the hard-pressed small and medium-sized company sector by a healthy 18 per cent.
The bank, which rebranded its three UK business Abbey, Alliance & Leicester and Bradford & Bingley as Santander recently, has so far remained unscathed by problems in its home market, including a recent credit downgrade of the Spanish economy, and taken advantage in the UK of the reluctance of the big domestic banks to lend and the inability of building societies to compete on savings rates.
Santander is now a worldwide bank with 47 per cent of its business in Europe and 35 per cent in Latin America. Britain accounted for £426m of profit in the first quarter and the bank is keen to increase its footprint further by bidding for the 300 plus Royal Bank of Scotland branches that the EU has told bailed-out RBS it must sell.
Smaller contenders like Virgin Money may argue that Santander is now playing in the same league as Barclays, HSBC, Lloyds Banking Group and RBS in the UK and should be prevented from acquiring the RBS branches as the others are.
It may still be able to creep under the wire. But there is no doubt that Santander has taken advantage of the recession and associated bank bail-outs (Lloyds, which now incorporates Halifax, and RBS have been busily concentrating on rebuilding their profits and reserves) to become one of the UK’s Premier League banks.