Banco Santander (SAN) investor relations material

Macroeconomic environment

• Global GDP growth for 2026 is forecast at 3.1%, with moderate expansion amid geopolitical tensions and lower inflation trends across key markets.

• Spain shows robust economic growth, declining unemployment (9.9% in Q1'26), and steady inflation (2.4%).

• Credit to the private sector in Spain is accelerating, with loans up 3.7% YoY and deposits up 5.5% YoY in Q1'26.

• Non-performing loan (NPL) ratios continue to decline, reflecting resilient economic performance and proactive management.

• Housing market remains tight, with rising prices and increased housing starts despite affordability challenges.

Business model and strategy

• Focus on building a digital bank with branches, leveraging global and local scale for profitability.

• Diversified revenue streams: Retail (54%), CIB (16%), Wealth (7%), Payments (21%), Openbank (2%).

• Double-digit growth in underlying profit (up 12% YoY in Q1'26), driven by higher revenue and lower costs.

• Credit quality remains robust across all business lines and geographies, with stable or improving NPL and cost of risk metrics.

Spain business highlights

• Loans grew 7% YoY to €245bn, deposits up 6% to €318bn, and mutual funds increased 14% to €110bn.

• Underlying profit rose 12% YoY, supported by volume growth, cost reductions, and improved credit quality.

• Efficiency ratio improved to 34.2%, and return on tangible equity (ROTE) reached 26%.