Santander, the euro zone's biggest bank, said it expected 2010 earnings to be similar to 2009's strong performance, adding that market uncertainties linked to Spain's economy were overdone.
Chairman Emilio Botin's upbeat comments to shareholders today were characteristic of the aggressively acquisitive bank which announced a $2.5 billion buyout of its Mexican division earlier this week.
Santander showed it had benefited from the loss of confidence in Spain's network of over 40 unlisted regional savings banks, or 'cajas', and their lack of ability to compete with its high-interest savings accounts by increasing its group deposits by 14.6% year to date.
Also adding to Santander's financial strength was its good debt structure with an average maturity of four and a half years, Botin said, adding the bank had raised €18 billion via new issues so far in 2010, despite market turbulence.
'This funding structure covers us for what may come in the future and compares very favourably with the ratios of our main competitors,' Botin said at the bank's annual shareholder meeting.
Smaller Spanish banks are losing access to money markets due to concerns Spain could be heading for a debt crisis along the lines of Greece and fears that their property losses could blow out of control.
The bursting of a decade-long housing bubble has left Spanish banks with over €300 billion of debt owed to them by property developers.
Santander's property risk is totally accounted for and covered, Botin said.
The chairman also said the bank would maintain last year's dividend payment.
