Santander Considers Options for UK Division Amid European Union Directive

Santander's UK division, encompassing former Abbey, Bradford & Bingley, and Alliance & Leicester, is at the center of speculation following European Union directives. The Royal Bank of Scotland, owner of Williams & Glyn's, has been compelled to sell 300 bank branches. This decision has sparked interest in Santander's options, which may include a partial flotation, debt market financing, or a share exchange. The process is still in its early stages, as confirmed by a source, and Santander and UBS, managing the sale, have declined to comment.

Key Takeaways:

• Santander's UK division, which includes former Abbey, Bradford & Bingley, and Alliance & Leicester, is in consideration for a potential sale or partial flotation.
• The sale is driven by European Union directives following the Royal Bank of Scotland's decision to sell 300 bank branches.
• Chief Executive Alfredo Saenz has stated that the bank does not have plans for a UK division flotation, but has left room for possibility in the future.
• The UK division is experiencing significant growth, with the sale of about half of all new mortgages in the UK, contributing to the bank's euros 8.9bn profit in 2009.
• Annual profits for the business reached pounds 1.5bn in 2019, a 30% increase from 2008.
• Contrary to press reports, Santander has not contacted its shareholders to test the idea of a partial flotation of the UK unit.
• The bank's Brazilian unit was listed on the stock market last year, generating euros 1.4bn (pounds 1.2bn) towards the bank's profit.

Statistics:

• Euros 8.9bn: Santander's profit in 2009, driven in part by the successful sale of its Brazilian unit.

Sources:

• The Guardian
• IBNSA

The European Union directives following the Royal Bank of Scotland's decision to sell 300 bank branches have triggered speculation surrounding Santander's options for its rapidly growing UK division.