Profile: Santander Bancorp (SBP.N)

Santander BanCorp is the financial holding company for Banco Santander Puerto Rico (Banco Santander). The Company operates a bank, offering products and services in the areas of commercial, mortgage and consumer banking. Insurance, securities and asset management services are also offered through the Company’s various subsidiaries. The Company organizes its operations in five reportable segments: Commercial Banking, Mortgage Banking, Consumer Finance, Treasury and Investments, and Wealth Management.

The Company offers a range of financial services through its subsidiaries Banco Santander Puerto Rico, Santander Securities Corporation (Santander Securities), Santander Insurance Agency, Inc. (Santander Insurance), Santander International Bank of Puerto Rico, Inc. (Santander International Bank), Santander Asset Management Corporation (SAM), Santander Financial Services, Inc. (Santander Financial Services), Island Insurance Corporation and Santander PR Capital Trust I. The Company’s main subsidiary, Banco Santander Puerto Rico, is a financial institution with a network of 57 branches and 169 automated teller machine (ATMs). The Bank provides a range of financial products and services to a customer base that includes small and medium-size businesses, large corporations and individuals. On January 1, 2008, Santander Mortgage Corporation (Santander Mortgage) was merged into Banco Santander. The Bank also provides specialized products and services to foreign customers through its wholly-owned subsidiary, Santander International Bank.

Santander Securities is a securities broker. SAM is a wholly owned subsidiary of Santander Securities created for the purpose of managing assets for Puerto Rico investment companies (mutual funds) and institutional accounts. The funds managed by SAM invest primarily in fixed-income securities, including Puerto Rico and United States Government securities, mortgage-backed and asset-backed securities and municipal obligations. It also services its institutional accounts, which consist primarily of university endowments, insurance companies, governmental agencies, pension funds and individual investors.

The Company’s subsidiary Santander Insurance offers products, including life, disability, unemployment and title insurance as a corporate agent, and also operates as a general agent offering bid, payment and performance bonds, and insurance to cover equipment and auto leases. Santander Financial Services is a consumer finance business in Puerto Rico. It provides consumer loans and real estate-secured loans to customers.

Commercial Banking

The Commercial Banking segment includes two units: retail banking and wholesale banking. The retail banking unit serves individual clients and small and medium-sized businesses providing them with a range of financial products and services through branches across Puerto Rico. The wholesale banking unit serves corporate and institutional clients, including the public sector, not-for-profit organizations and specialized industries, such as universities, healthcare and financial institutions.

Mortgage Banking

The Mortgage Banking segment originates, sells and services a variety of residential mortgage loans. Total mortgage loan originations amounted to $345.7 million, during the year ended December 31, 2008.

Consumer Finance

The Island Finance operation provides consumer loans and real estate-secured loans through its 64 consumer retail branches in Puerto Rico. Island Finance provides lending to Band C borrowers (Individuals with Fair Isaac Corporation (Fico Scores) of 620 or less among other factors), which represent approximately of 30.3% of total loan portfolio.

Treasury and Investments

Santander BanCorp’s Treasury department handles its investment portfolio and liquidity position. It also focuses on offering financial service to its clients in the form of derivative instruments.

Wealth Management

The Company’s Wealth Management segment includes the operations of its subsidiary Santander Securities. Santander Securities offers a range of products and services as part of an overall wealth management program that includes asset management and other trust services.