Annual Report 2007 - Santander

CONSUMER FINANCESANTANDER CONSUMER FINANCE’S ATTRIBUTABLEPROFIT ROSE TO EUR 719 MILLION IN 2007 AS ITEXPANDED INTO NEW MARKETSBetter management of products and strict cost control offset the adverseeconomic environment for businessSantander ConsumerFinance is present inGermany, Spain,Italy, Portugal,Poland, Norway,Sweden, the UK,Finland, theNetherlands, Austria,Denmark, Hungary,the Czech Republic,Russia, the US, Chile,Mexico and FranceSantander Consumer Finance is theGroup’s area that specialises in consumerfinance.Its main businesses are auto financeand personal loans, which, together,account for 77% of the portfolio andcontribute around 80% of profit beforetaxes.The strategy is based on providingfinance at the point-of-sale; SantanderConsumer Finance has a large network ofdistributors (mainly auto dealerships) withwhom it reaches agreements to providefinance for automobiles and otherconsumer goods. Once a relation is startedwith final customers, Santander ConsumerFinance strives to increase customerlinkage and loyalty by directly offeringthem other products such as credit cards.The Division also includes Openbank,the Group’s online bank.BUSINESS IN 2007Santander Consumer faced an adverseeconomic climate in 2007, because ofhigher interest rates in Europe, growingcompetition and stagnant car sales inEuropean countries.Santander Consumer Finance USA, inits first year as part of Grupo Santander,produced exceptional results in achallenging market caused by the US subprimemortgage crisis.As a result of these factors. SantanderConsumer Finance managed to maintaingood growth and profitability rates.Attributable profit was EUR 719 million.Also of note was the expansion intonew markets such as Russia, Mexico, Chile,France and Finland, either by acquiringsmall consumer finance companies,forming joint ventures with local operatorsor creating start-ups.SANTANDER CONSUMER FINANCEMillion eurosCountries 19Customers (millions) 9.9Branches (number) 285Employees (number) 7,221Customer lending 45,731Managed customer funds 32,953Net operating income 1,867Attributable profit 719Efficiency (%) 29.6424