Business · Companies · 2 hrs ago
Santander seeks more loyal customers to keep funding costs down
Santander wants more of its nearly 190 million global customers to use it as their main bank.
In Spain, the bank has 15 million customers, and CEO Héctor Grisi said customers who deposit their salaries and pay bills from their accounts tend to keep money there for everyday use.
Those transactional deposits can be cheaper for the bank than savings that customers move to whichever provider offers the best rate.
Santander has seen stronger competition for deposits in Spain from online banks and smaller or foreign lenders.
Grisi said Santander is growing its deposit base and controlling costs, but gave less detail about how it is retaining customers with more savings.
Keeping funding costs under control in Spain matters to the wider group, as the gap between Spain's contribution to profits and Brazil's has grown to €2.1 billion from €1.6 billion a year earlier.
Santander is seeking to strengthen the loyalty of its nearly 190 million customers worldwide to help keep funding costs down.
The bank says loyal customers can generate more revenue by buying more products and are cheaper to serve.
Chief Executive Héctor Grisi said Santander is focusing on transactional deposits linked to customers’ salaries and bills.
The bank has detected increased competition for deposits in Spain since the third quarter.
Santander said it is growing its deposit portfolio in Spain and controlling its cost.
- Who
- Santander, whose chief executive is Héctor Grisi.
- What
- The bank is seeking more customer loyalty and transactional deposits to help limit funding costs.
- When
- Grisi discussed the issue while presenting quarterly results; the date of the presentation is not stated.
- Where
- Worldwide, including Spain, where Santander has 15 million customers.
- Why
- Loyal customers can generate more revenue from products and are cheaper for the bank; controlling funding costs in Spain is important to the group.
This story does not have two clearly opposing sides.
Santander detected increased competitive pressure for deposits in Spain.
Grisi discussed transactional deposits and Santander’s approach to retail banking in Spain while presenting quarterly results.
- Worldwide customers
- Nearly 190 million
- Customers in Spain
- 15 million
- Deposit competition in Spain
- Increased since the third quarter
- Spain deposit operation
- €5 billion with a public institution during the quarter
- Profit contribution gap
- Spain exceeded the second-largest unit, Brazil, by €2.1 billion, compared with €1.6 billion a year earlier
What people are saying
We are focusing on transactional deposits. If people have their salary and bills paid into their account, they need to keep money in their current account because they need it throughout the month.
In Spain, we are controlling retail banking operations very closely.