Spain's Santander said today that its net profit in the third quarter rose 20% from the same quarter in 2022 thanks to higher lending income in Europe, which offset a weaker performance in the US.
The euro zone's second-biggest lender in terms of market value booked a net profit of €2.9 billion, beating the €2.77 billion expected by analysts polled by Reuters.
Santander has relied on Latin America in the past to cope with tough conditions in Europe, though it now benefits, like its European rivals, from higher interest rates.
"While the external environment is increasingly uncertain, I am confident that we will achieve our 2023 targets given the positive momentum which we also expect to carry into 2024", the bank's Chairman Ana Botin said in a statement.
The bank said it remained on track to meet its 2023 targets, including double-digit income growth and a return on tangible equity ratio (ROTE), a measure of profitability, of higher than 15%.
Santander's net interest income, or earnings on loans minus deposit costs, rose 11.6% year-on-year in the quarter to €11.22 billion, above analysts' average estimate of €11 billion.
In Spain, the bank's biggest market, net profit rose almost 60%, while NII jumped 56%. Results at home were backed by higher returns on loans, driven by predominantly floating rates credit books, while deposit costs grew at a slower pace.
In Brazil, its second-biggest market, net profit fell 8.9%, though NII rose 3.3%, reflecting an improvement in trends.
Net profit in the US fell 50.4% on higher funding costs in the auto business while provisions rose 49%.
