Santander says first quarter profit up 5.7 percent
Santander on Thursday reported a first quarter net profit that beat expectations, but Spain's biggest bank said the future looked tough and growth would come from Latin America.
"In the next few months, we will have to manage an environment that remains complicated," said Santander chief executive Alfredo Saenz.
The banking group will face "difficulties" in western Europe due to macro-economic challenges and low interest rates, he said.
"On the other hand, we have the emerging markets which are finding near pre-crisis growth levels again," Saenz said, pointing to Latin America and especially Brazil.
Santander said its first quarter net profit rose 5.7 percent from a year earlier to 2.22 billion euros (2.93 billion dollars).
Financial analysts polled by Dow Jones Newswires had forecast a net profit of around 2.16 billion euros.
Santander's net profit in Latin America rose by 14.6 percent to 1.02 billion euros.
"Brazil brought 21 percent of the group's profit and reached a record 603 million euros in three months," a 38 percent increase from a year earlier, the bank said.
Net banking income -- the difference between interest earned and interest paid out to depositors, a core measure of bank earnings -- rose 17.9 percent to 7.12 billion euros.
Bad debt as a percentage of total loans increased to 3.34 percent from 2.49 in the first quarter of 2009, the bank said.
The bank attributed its higher first quarter profit increase to lower provisions for bad debt.
Shares in Santander rose by 4.77 percent to 9.53 euros after the bank published its results.
- Dow Jones Newswires contributed to this report -
© 2010 AFP