Santander UK boosts profits as Spanish group moots online storage plan

Spanish banking group Santander announced better revenues than expected as new chairman Ana Botín delivered her first set of results, with the UK arm delivering a healthy increase in fourth-quarter profits.

Santander also surprised with plans to become the first bank to offer cloud data storage to corporate clients, leveraging its reputation as a "trusted" organisation in banking to enter an unrelated area via its technology arm, Produban, and counter insurgencies into the payment sector by companies such as Apple and ebay's PayPal.

"As I think how am I going to compete with all these new technology players, I can offer the same services as some of these big guys," Botín told the Financial Times.

The group enjoyed a 7.6% increase in fee income to help lift overall revenues by a better-than-expected 10.2% to €11bn, with profits up 70% to €1.46bn despite costs expanding 3%.

Santander UK lifted pre-tax profits 26% to £1.34bn for the year ended 31 December as total operating income climbed 11% to £4.47bn.

UK current account balances totalled £41.1bn with an increase of £1bn each month since 2012. The company also swelled it gross mortgage lending 43% to a value of £26.3bn while net mortgage lending rose £2bn to total £150.1bn.

UK chief executive Nathan Rostock said: “The UK economy improved during 2014 and will, we believe, continue to be supportive of our business in 2015.

“Progress on clarifying the regulatory landscape has been made and further details are expected in 2015, particularly in relation to capital, leverage, conduct and banking structure.

“Early completion of these reforms, in a proportionate way, will help us to contribute fully to UK’s ongoing economic recovery.”