UPDATE 1-Santander expects pick-up in earnings this year
(Adds detail, quotes)
By Jesús Aguado
SANTANDER, Spain, March 22 (Reuters) - Spanish lender Santander said on Friday it expected a boost to earnings this year once a government-mandated clean-up of its property assets was completed.
"Our profit reached a turning point in 2012 and in 2013, once the real estate clean-up is finished, we will see a strong increase in earnings," Chairman Emilio Botin said at the company's annual shareholders' meeting in Santander in northern Spain.
Santander last year increased provisions for bad loans and wrote down the value of its property assets in recession-hit Spain, where the bursting of a real estate bubble five years ago crippled many of the country's banks.
The bank reported a 59 percent drop in profit for 2012 to 2.2 billion euros ($2.84 billion) after writedowns totally 18.8 billion euros on toxic Spanish assets.
Botin said the group had successfully shed property assets last year, reducing its portfolio by 8 percent.
"In 2012 we sold more properties than we added to our balance sheet. I hope we will have sold a very significant chunk of our property portfolio by 2014," he said.
Santander's chairman said he expected the coming quarters to be difficult for Spain's economy but he was relatively optimistic about 2014.
"We are confident we are close to a change of cycle ... the Spanish economy has entered a new phase and we will start to see the results in the second half of the year and in 2014," he said.
Botin told shareholders that Santander expected to end 2013 with a core capital ratio of 8 percent, under new rules known as Basel III - five years ahead of a schedule for full implementation. ($1 = 0.7737 euros) (Writing by Clare Kane; Editing by Fiona Ortiz and Jane Merriman)
- Housing, jobs data weaken, but overall economic picture still upbeat
- Putin critic Khodorkovsky free after pardon, heads for Germany |
- Target cyber breach hits 40 million payment cards at holiday peak |
- Pizza outlet attacked as India, U.S. fail to cool diplomat row |
- New York Mayor-elect's reputation for lateness parodied on Twitter