Business Context and Reporting Period
This Form 6-K filing covers the interim period of January 1 to June 30, 2026 for Banco Santander, S.A. The report was approved by the Board of Directors on July 21, 2026. The period is characterized by significant M&A activity, including the completion of the TSB acquisition in the UK and the disposal of Santander Poland. The Group operates across five global businesses: Retail & Commercial Banking, Openbank, Corporate & Investment Banking (CIB), Wealth Management & Insurance, and Payment Solutions.
Key Financial Metrics
| Metric | H1 2026 | H1 2025 | Change |
|---|---|---|---|
| Profit Attributable to Parent | EUR 8,973 million | EUR 6,833 million | +31.3% |
| Underlying Profit Attributable to Parent | EUR 7,328 million | EUR 6,377 million | +14.9% |
| Total Income | EUR 30,822 million | EUR 28,978 million | +6.4% |
| Net Interest Income | EUR 22,711 million | EUR 21,211 million | +7.1% |
| Net Fee Income | EUR 6,851 million | EUR 6,342 million | +8.0% |
| Efficiency Ratio | 42.8% | 45.7% | -2.9 pp |
| Cost of Risk | 1.15% | 1.13% | +2 bps |
| CET1 Ratio (Phased-in) | 14.0% | 13.0% | +1.0 pp |
| Total Assets | EUR 1,954,465 million | EUR 1,815,888 million | +7.6% |
| Loans to Customers | EUR 1,149,162 million | EUR 1,010,727 million | +13.7% |
| Customer Deposits | EUR 1,133,762 million | EUR 1,008,229 million | +12.5% |
Material Changes vs. Prior Period
- Poland Disposal: The sale of Santander Poland to Erste Group was completed in January 2026, generating a net capital gain of EUR 1,895 million. This one-off gain significantly boosted statutory profit but is excluded from underlying results.
- TSB Acquisition: Santander completed the acquisition of TSB Banking Group plc in the UK on April 30, 2026, for approximately EUR 3.3 billion. TSB results are included from May 2026, contributing to loan and deposit growth but impacting the CET1 ratio by -55 bps.
- Webster Acquisition: An agreement was announced to acquire Webster Financial Corporation in the US for USD 12.2 billion (approx. EUR 10.3 billion), subject to regulatory approval. This is expected to impact the CET1 ratio by approximately -150 bps upon completion.
- Profitability: Statutory profit rose 31% year-on-year, driven by the Poland gain. Underlying profit, which excludes non-recurring items, grew 15% year-on-year, reflecting organic growth in revenue and cost management.
- Cost of Risk: Remained stable at 1.15%, with higher provisions in Argentina and specific single names in CIB offset by improvements in other regions.
Guidance, Outlook, and Risks
- Capital Targets: Management remains on track to end 2026 with a CET1 ratio in the range of 12.8% to 13.0%, despite the dilutive impact of the TSB and expected Webster acquisitions.
- Shareholder Remuneration: The Group intends to distribute approximately 50% of underlying profit to shareholders in 2026, split evenly between cash dividends and share buybacks. A EUR 5.03 billion buyback program was launched in February 2026.
- Outlook: Economic growth indicators are solid across the footprint, though geopolitical tensions in the Middle East and potential inflationary pressures pose risks. The Group expects a moderate economic slowdown compared to previous estimates.
- Risks: Key risks include geopolitical instability, inflation volatility, credit quality deterioration in specific markets (notably Argentina), and integration risks associated with the TSB and Webster acquisitions.
Investor Verification Checklist
- Underlying vs. Statutory Profit: Verify the distinction between the EUR 8.97 billion statutory profit (including the Poland gain) and the EUR 7.33 billion underlying profit to assess organic performance.
- TSB Integration: Monitor the integration progress of TSB and its impact on the UK segment's efficiency ratio and cost of risk in subsequent quarters.
- Webster Regulatory Approval: Track the status of regulatory approvals for the Webster acquisition, as delays or conditions could alter the capital plan and timeline.
- Argentina Exposure: Review credit quality metrics and provisions specifically for Argentina, where the cost of risk remains elevated due to sector-wide trends.
- Capital Buffer: Confirm the CET1 ratio trajectory against the 12.8-13.0% target, considering the expected -150 bps impact from the Webster deal.