In news from the Spain real estate situation, Banco Santander SA (SAN), the largest bank in the country, Q3 profits dropped far more than estimates predicted. Bad real estate date saw earnings drop an estimated 94 plus percent, while the bank's net income dropped an estimated €100 million euro.
Santander, along with several other Spain banks, have lost substantially on bad real estate dealings. Acting in response to the Spain government's demand banks write off piled up bad debt. The bank also had substantial losses with UK and even Brazilian investments, according to their report. Santander's might have added some €5.279 bíllion to their coffers were it not for the write-off of some €3.475 million in losses for real estate exposure in Spain.
CEO and Vice-Chairman, Alfredo Sáenz was on hand for the results presentation which can be viewed here, as well as a news conference. Sáenz also told analysts today:
“A situation in which the Treasury funding is being helped by contingency credit lines offered by any international body will produce a fall in the sovereign debt risk premium and, as a consequence, a fall in banks’ risk premium."
Saenz suggested his bank's holdings of the country's sovereign dept at right around €30-billion in September, a figure that was down substantially over earlier figures this Summer. Now the bank is pressuring the Spain government to seek bailout funds based largely on this latest purge by them. Interested readers may want to view the official press release from Santander here (PDF).
Photo credit: Santander CEO image - courtesy the bank.