FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934

For the month of October, 2011

Commission File Number: 001-12518

Banco Santander, S.A.

(Exact name of registrant as specified in its charter)

Ciudad Grupo Santander
28660 Boadilla del Monte (Madrid) Spain
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F þ     Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes o     No þ

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes o     No þ

Banco Santander, S.A.

INCORPORATION BY REFERENCE

This report on Form 6-K/A, except for the last paragraph on page 17 of Item 1, shall be deemed to be incorporated by reference into the registration statement on Form F-3 (Registration Number: 333-173149) of Banco Santander, S.A. and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

Banco Santander, S.A.

TABLE OF CONTENTS

Item
1	Third Quarter 2011 —results financial report
2	Third Quarter 2011 —results financial statements

FINANCIAL REPORT 2011 JANUARY — SEPTEMBER

FINANCIAL REPORT 2011

2 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONTENTS

www.santander.com

KEY CONSOLIDATED DATA	5
HIGHLIGHTS OF THE PERIOD	6
CONSOLIDATED FINANCIAL REPORT	8
Income statement	9
Balance sheet	13
RISK MANAGEMENT	20
THE SANTANDER SHARE	23
INFORMATION BY PRINCIPAL SEGMENTS	24
Continental Europe	28
United Kingdom	36
Latin America	38
Sovereign	46
Corporate Activities	48
INFORMATION BY SECONDARY SEGMENTS	50
Retail Banking	50
Global Wholesale Banking	52
Asset Management and Insurance	54
CORPORATE GOVERNANCE	56
SIGNIFICANT EVENTS IN THE QUARTER	57
CORPORATE SOCIAL RESPONSIBILITY	58

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 3

4 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

KEY CONSOLIDATED DATA

	9M’11		9M’10		Amount			(%)			2010
BALANCE SHEET (Million euros)
Total assets		1,250,476		1,235,712		14,764			1.2			1,217,501
Net customer loans		734,302		715,642		18,661			2.6			724,154
Customer deposits		619,911		601,293		18,618			3.1			616,376
Customer funds under management		976,598		984,195		(7,597	)		(0.8	)		985,269
Shareholders’ equity		79,144		73,753		5,391			7.3			75,273
Total managed funds		1,382,920		1,375,136		7,783			0.6			1,362,289
INCOME STATEMENT (Million euros)
Net interest income		22,853		21,896		957			4.4			29,224
Gross income		33,254		31,436		1,818			5.8			42,049
Net operating income		18,529		17,938		591			3.3			23,853
Profit from continuing operations		5,977		6,817		(841	)		(12.3	)		9,129
Attributable profit to the Group		5,303		6,080		(777	)		(12.8	)		8,181
EPS, PROFITABILITY AND EFFICIENCY (%)
EPS (euro)		0.5981		0.7010		(0.1030	)		(14.7	)		0.9418
Diluted EPS (euro)		0.5929		0.6949		(0.1021	)		(14.7	)		0.9356
ROE		9.47		11.75								11.80
ROTE		14.32		18.04								18.11
ROA		0.65		0.77								0.76
RoRWA		1.37		1.55								1.55
Efficiency ratio (with amortisations)		44.3		42.9								43.3
BIS II RATIOS AND NPL RATIOS (%)
Core capital		9.42		8.47								8.80
Tier I		10.74		9.72								10.02
BIS ratio		13.24		12.98								13.11
NPL ratio		3.86		3.42								3.55
NPL coverage		66		75								73
MARKET CAPITALISATION AND SHARES
Shares outstanding (millions at period-end)		8,440		8,229		211			2.6			8,329
Share price (euros)		6.224		9.317		(3.093	)		(33.2	)		7.928
Market capitalisation (million euros)		52,532		76,668		(24,136	)		(31.5	)		66,033
Book value (euro)		8.91		8.49								8.58
Price / Book value (X)		0.70		1.10								0.92
P/E ratio (X)		7.81		9.97								8.42
OTHER DATA
Number of shareholders		3,263,997		3,146,531		117,466			3.7			3,202,324
Number of employees		191,350		176,471		14,879			8.4			178,869
Continental Europe		63,934		54,551		9,383			17.2			54,518
o/w: Spain		33,214		33,536		(322	)		(1.0	)		33,694
United Kingdom		26,034		23,109		2,925			12.7			23,649
Latin America		90,106		87,765		2,341			2.7			89,526
Sovereign		8,950		8,539		411			4.8			8,647
Corporate Activities		2,326		2,507		(181	)		(7.2	)		2,529
Number of branches		14,709		13,907		802			5.8			14,082
Continental Europe		6,636		6,075		561			9.2			6,063
o/w: Spain		4,785		4,856		(71	)		(1.5	)		4,848
United Kingdom		1,386		1,328		58			4.4			1,416
Latin America		5,964		5,784		180			3.1			5,882
Sovereign		723		720		3			0.4			721

Note: The financial information in this report has not been audited, but it was approved by the Board of Directors at its meeting on October, 24 2011, following a favourable report from the Audit and Compliance Committee on October, 19 2011. The Committee verified that the information for the quarter was based on the same principles and practices as those used to draw up the annual financial statements.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 5

HIGHLIGHTS OF THE PERIOD

INCOME STATEMENT: (pages 9 — 12)

• The Group posted an attributable profit of EUR 1,803 million in a period marked by a difficult economic and financial environment

• The profit for the first nine months was in EUR 5,303 million, 12.8% less than in the same period of 2010. Earnings per share were EUR 0.5981. The profit was 2.6% lower when excluding the provision of £538 million net of taxes for payment protection insurance remediation (PPI) in the UK made in the second quarter.

• The Group continued to prove its capacity to generate high operating profits in a very complex environment. Net operating income after provisions increased 6.6% year-on-year.

• Double-digit growth at Santander Consumer Finance and Sovereign, more moderate in Brazil and Latin America ex-Brazil and declines in the UK due to regulatory effects, Spain and Portugal, hard hit by the macroeconomic environment. Good performance of BZ WBK, which consolidated in the second quarter.

• Retail Banking registered 8.0% growth, while GBM was more impacted by the market’s evolution.

• The lines of the income statement reflect the main management focus:

• Good performance of gross income (+5.8%). Net interest income and net fee income notched up another quarterly record. Lower gains on financial transactions and payment of dividends in the quarter due to the environment and seasonal features.

• Operating expenses increased 9.1% because of new business projects, investments in technology and increased installed capacity (802 branches, 14,879 employees).

• Provisions declined 1.0% thanks to falls at Santander Consumer Finance, the UK, Latin America ex-Brazil and Sovereign. Increases in Portugal and Brazil and virtually unchanged in Spain.

STRONG BALANCE SHEET: (pages 13 — 22)

• Core capital ratio of 9.42% at the end of September, an increase of 22 basic points in the quarter and 62 b.p. over December 2010, after absorbing the impact of the entry of Banco Zachodni WBK and the charge in the UK (PPI), both in the second quarter.

• Better financing structure (deposits plus medium and long-term funding to loans ratio of 116%, from 113% in September 2010). The liquidity ratio (loans-to-deposits) remained below 120%. Capturing deposits has been very selective this year, giving priority to the return, and activity in wholesale issues remained strong through good access to markets, which kept a solid liquidity position.

• The Group’s non-performing loans and coverage ratios were 3.86% and 66%, respectively, at the end of September. The NPL ratio in Spain was 5.15% and coverage 46%.

SIGNIFICANT EVENTS IN THE QUARTER AND SUBSEQUENT ONES: (more detail on page 57)

• Agreement for the entry of new partners in Santander Consumer USA. SC USA will increase its capital by approximately $1.15 billion.

• The transaction values the company at $4 billion. Following this transaction, Santander will realize a capital gain of approximately $1 billion.

• The capital gains resulting from this transaction and from the transaction signed in july with Zurich Financial Services, (about EUR 1,500 million) will be fully allocated in the fourth quarter to reinforce the Group’s balance sheet.

6 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

HIGHLIGHTS OF THE PERIOD

THE SANTANDER SHARE: (page 23)

• The Santander share price was EUR 6.224 on September 30, 21.8% lower than at the end of June and 33.2% below that a year earlier. Its performance, however, was better than that of the DJ Stoxx Banks, the benchmark banking index (-28.0% and -36.2%, respectively).

• The first interim dividend charged to 2011’s profits of EUR 0.135 gross in cash per share was paid on August 1, the same amount as that paid as the first interim dividend charged to 2010’s profits.

• As a result of the good reception given in 2009 and 2010 to Santander Dividendo Elección (scrip dividend), this system will be used again in November for the second interim dividend. This means that shareholders can opt to receive the amount in cash (EUR 0.126 per share) or in shares.

BUSINESS AREAS: (more detail on pages 24-55)

• Continental Europe: attributable profit of EUR 2,441 million, 10.9% less than in the first nine months of 2010 because of the fall in the units in Spain and Portugal. Santander Consumer Finance, on the other hand, performed well and its profit was 64.8% higher. BZ WBK contributed EUR 172 million in the six months since its consolidation into the Group.

• United Kingdom: attributable profit of £659 million, very affected by the impact of £538 million charge for payment protection insurance (PPI) made in the second quarter. Excluding this charge, profit was £1,198 million, 8.6% lower.

• Latin America: attributable profit of EUR 3,528 million, 3.0% more than in the first nine months of 2010. In local currency, growth was also 3.0% fuelled by higher net interest income and fee income driving gross income up 9.6% and offseting the larger investments in commercial capacity, provisions and taxes. Brazil’s attributable profit was EUR 1,973 million, 4.4% lower. In local currency it was 6.1% lower. Good performance in gross income offset by larger provisions, taxes and minority interests.

• Sovereign: attributable profit of $554 million, 44.4% more than in the first nine months of 2010, with a good performance in gross income and a large fall in provisions.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 7

CONSOLIDATED FINANCIAL REPORT

GENERAL BACKGROUND

Grupo Santander is conducting its business against a background of a sharper slowdown in the global economy. The bad US activity figures, and also in Europe in the second quarter and at the beginning of the third, together with uncertainty over the European sovereign debt crisis, pushed up risk aversion and eroded consumer and corporate confidence, producing lower than envisaged growth in the world economy.

• US growth remained low (+1.3% quarter-on-quarter annualised in the second quarter after 0.4% in the first). The slowdown was sharper and longer than anticipated and confirms the weak recovery. This weakness is likely to continue, at least during the third quarter, judging by the employment figures and the state of household finances, particularly in the current context of volatility in the financial markets.

As a result, and with inflation under control (the underlying rate is close to 1.5%), the Federal Reserve continues to keep its eye on activity and remains committed to a soft monetary policy that supports growth,

• In Latin America, some monetary policy decisions and, more recently, on exchange rates seek to anticipate this environment of low global growth before its impact on activity.

Brazil’s growth eased to 3.1% year-on-year from 4.2% in the first quarter. Despite very high inflation (7.3%) that is above target, the central bank started lowering interest rates with two cuts in its Selic rate (-100 b.p. to 11.5% in October). The bank believes that the deterioration in the international scenario, a tighter fiscal policy and measures to moderate capital inflows will be enough to reduce inflationary tensions. In addition, the interest rate move halted the real’s appreciation (BRL1.86/US$1 at the end of September compared to BRL1.56/US$ in June).

Mexico’s growth also slowed in the second quarter (+3.3% year-on-year compared to 4.6% in the first three months) because of lower exports, affected by the US, and reduced domestic demand. In this environment, the economy still maintains a dynamism that will enable it to grow by around 3.8% this year, similar to Brazil, according to the International Monetary Fund. Inflation, stable at reasonable levels (3.1% in September), kept official interest rates unchanged (4.5%) and opened up the possibility of cuts in 2012. The peso depreciated and ended September at MXN 13.8/US$1, a level not seen since the middle of 2008.

Chile’s growth remained strong in the second quarter (+6.8% y-o-y). Stable inflation (3.3% in September) and the deterioration of the external scenario led the central bank to stop raising interest rates at 5.25%. This caused the peso to depreciate to CLP 521/US$1 at the end of September, with a loss of relative value less than that of the region’s main currencies.

• In the Eurozone, third quarter indicators continued to point to a deterioration of activity following the slowdown in the second quarter (+0.6% quarter-on-quarter annualised compared to 3.1% in the first three months), a process intensified by the financial tensions from the sovereign debt crisis. The euro depreciated against the dollar (US$1.35/EUR1 at the end of September). This could mean a reversal by the European Central Bank of the rises in interest rates which left the rate at 1.50% in July. Stable inflation (2.5% in August) and moving toward the goal in the coming quarters will facilitate the change.

There are significant divergences in growth in the euro zone. The growth of the three countries that have been bailed out has declined, while Italy and Spain are growing but are suffering the effects of the financial contagion. In Germany, after the sharp slowdown (to 0.5% in the second quarter from 5.5% in the first three months), the third quarter indicators continue to point to reasonable expansion.

The Spanish economy also grew less in the second quarter (+0.2% quarter-on-quarter annualised, down from 0.4% in the first three months). External demand is still the engine of growth, particularly exports of services (including tourism), as against domestic demand depressed by the decline in public consumption, weak investment (fall in construction) and further job losses. All of this moderated inflation (3.1% in September), a trend expected to continue.

• The pattern of the slowdown in the UK was similar (+0.7% quarter-on-quarter annualised in the second quarter compared to 1.9% in the first three months), which is expected to continue in the third quarter because of weaker external and domestic demand. With inflation still very high (5.2% in September) and not expected to come down, the Bank of England focused on managing growth risks, keeping the base rate at 0.5% and implementing more quantitative easing. Sterling ended September stronger against a euro affected by the sovereign debt crisis (EUR 1.15/£1).

EXCHANGE RATES: 1 EURO / CURRENCY PARITY

	Average (income statement)				Period-end (balance sheet)
	9M’11		9M’10		30.09.11		31.12.10		30.09.10
US	$	1.4055		1.3113		1.3503		1.3362		1.3648
Pound sterling		0.8711		0.8563		0.8667		0.8608		0.8600
Brazilian real		2.2928		2.3347		2.5067		2.2177		2.3201
New Mexican peso		16.9089		16.6655		18.5936		16.5475		17.1258
Chilean peso		666.5810		682.2170		703.7088		625.2748		661.3138
Argentine peso		5.7494		5.1068		5.6773		5.3074		5.4073
Polish zloty		4.0163		4.0023		4.4050		3.9750		3.9847

8 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

GRUPO SANTANDER RESULTS

• Gross income rose 5.8% year-on-year, due to the good evolution of net interest income (+4.4%) and fee income (+10.0%).

• Worse evolution in the third quarter of gains on financial transactions (because of the market environment) and other operating income (seasonal impact on dividends received).

• Operating expenses increased 9.1% because of new commercial projects, an increase in installed capacity and technology investments.

• Loan-loss provisions were 1.0% lower, due to the reduction in specific provisions (-9.5%), offset by the smaller release of generic provisions.

• Net operating income after provisions rose 6.6% year-on-year.

Attributable profit in first nine months was EUR 5,303 million, 12.8% less than in the same period of 2010. The fall was due to an impact of EUR 620 million (£538 million) net of tax from an extraordinary provision made in the second quarter related to Payment Protection Insurance (PPI) in the UK.

Moreover, this was negatively impacted by higher tax pressure, which absorbed 6 percentage points of the year-on-year profit growth.

INCOME STATEMENT
Million euros

							Variation
	9M’11			9M’10			Amount			(%)
Net interest income		22,853			21,896			957			4.4
Dividends		294			251			43			17.1
Income from equity-accounted method		16			13			3			26.0
Net fees		8,017			7,290			728			10.0
Gains (losses) on financial transactions		2,018			1,890			128			6.8
Other operating income/expenses		56			97			(41	)		(42.2	)
Gross income		33,254			31,436			1,818			5.8
Operating expenses		(14,725	)		(13,498	)		(1,227	)		9.1
General administrative expenses		(13,150	)		(12,088	)		(1,061	)		8.8
Personnel		(7,682	)		(6,908	)		(774	)		11.2
Other general administrative expenses		(5,468	)		(5,180	)		(287	)		5.5
Depreciation and amortisation		(1,575	)		(1,409	)		(166	)		11.8
Net operating income		18,529			17,938			591			3.3
Net loan-loss provisions		(7,777	)		(7,854	)		78			(1.0	)
Impairment losses on other assets		(184	)		(161	)		(23	)		14.0
Other income		(2,290	)		(1,057	)		(1,234	)		116.7
Profit before taxes		8,278			8,866			(588	)		(6.6	)
Tax on profit		(2,302	)		(2,049	)		(253	)		12.3
Profit from continuing operations		5,977			6,817			(841	)		(12.3	)
Net profit from discontinued operations		(21	)		(17	)		(4	)		25.7
Consolidated profit		5,955			6,800			(845	)		(12.4	)
Minority interests		652			720			(68	)		(9.5	)
Attributable profit to the Group		5,303			6,080			(777	)		(12.8	)
EPS (euros)		0.5981			0.7010			(0.1030	)		(14.7	)
Diluted EPS (euros)		0.5929			0.6949			(0.1021	)		(14.7	)
Pro memoria:
Average total assets		1,224,643			1,180,196			44,447			3.8
Average shareholders’ equity		74,687			68,990			5,697			8.3

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 9

CONSOLIDATED FINANCIAL REPORT

QUARTERLY
Million euros

	Q1’10			Q2’10			Q3’10			Q4’10			Q1’11			Q2’11			Q3’11
Net interest income		7,122			7,378			7,396			7,329			7,514			7,638			7,700
Dividends		47			144			60			111			40			193			60
Income from equity-accounted method		3			5			5			4			5			5			6
Net fees		2,326			2,483			2,481			2,445			2,595			2,729			2,694
Gains (losses) on financial transactions		724			567			599			715			657			722			639
Other operating income/expenses		38			38			22			9			41			(2	)		18
Gross income		10,260			10,614			10,563			10,613			10,852			11,285			11,117
Operating expenses		(4,263	)		(4,548	)		(4,687	)		(4,698	)		(4,824	)		(4,908	)		(4,994	)
General administrative expenses		(3,812	)		(4,070	)		(4,206	)		(4,168	)		(4,314	)		(4,380	)		(4,456	)
Personnel		(2,182	)		(2,317	)		(2,408	)		(2,421	)		(2,521	)		(2,550	)		(2,611	)
Other general administrative expenses		(1,629	)		(1,753	)		(1,798	)		(1,746	)		(1,792	)		(1,830	)		(1,845	)
Depreciation and amortisation		(451	)		(478	)		(481	)		(531	)		(510	)		(528	)		(538	)
Net operating income		5,997			6,066			5,876			5,915			6,029			6,377			6,123
Net loan-loss provisions		(2,436	)		(2,483	)		(2,935	)		(2,404	)		(2,188	)		(2,684	)		(2,906	)
Impairment losses on other assets		(57	)		(63	)		(41	)		(310	)		(48	)		(52	)		(84	)
Other income		(331	)		(362	)		(364	)		(16	)		(550	)		(1,379	)		(361	)
Profit before taxes		3,173			3,158			2,535			3,186			3,243			2,262			2,773
Tax on profit		(734	)		(680	)		(634	)		(874	)		(888	)		(636	)		(778	)
Profit from continuing operations		2,439			2,477			1,901			2,311			2,355			1,627			1,995
Net profit from discontinued operations		(12	)		(1	)		(4	)		(10	)		(6	)		(0	)		(15	)
Consolidated profit		2,427			2,476			1,897			2,301			2,349			1,626			1,980
Minority interests		212			246			262			201			241			234			177
Attributable profit to the Group		2,215			2,230			1,635			2,101			2,108			1,393			1,803
EPS (euros)		0.2553			0.2574			0.1884			0.2408			0.2382			0.1569			0.2030
Diluted EPS (euros)		0.2537			0.2558			0.1854			0.2406			0.2364			0.1558			0.2007

Net operating income after provisions, which is the best reflection of the underlying business, increased 6.6% year-on-year, spurred by growth in basic revenues (net interest income, fee income and insurance), mainly from retail banking which again increased in the quarter. Together with an economic environment, in which the degree of recovery varies by country, and in order to better interpret the results, several aspects need to be taken into account:

• There is a perimeter impact of around 3 p.p. in revenues and expenses due to the change in perimeter, mainly resulting from the consolidation of Bank Zachodni WBK and to a lesser extent from AIG in Poland and SEB in Germany (Santander Retail).

• The first nine month’s results do not include the capital gains from the agreement with Zurich Financial Services signed in July and from the entry of partners in Santander Consumer USA capital agreed in October. Both operations (about EUR 1,500 million net of tax) will be recorded in the fourth quarter and will be used to strengthen the Group’s balance sheet.

• Lastly, the exchange rate impact of the various currencies against the euro is virtually zero (less than one p.p. negative) in the comparison of gross income and operating expenses with the first nine months of 2010. By large geographic areas, in the UK and Sovereign there is a negative impact of 2 and 7 p.p., respectively, while in Latin America there is a positive impact of 1 percentage point.

The performance of the income statement and comparisons between the first nine months of 2010 and the same period of 2011 was as follows:

Gross income was EUR 33,254 million, 5.8% higher year-on-year (+3.9% excluding the perimeter and exchange rate effects) and strongly backed by basic revenues (+5.9%).

• Net interest income rose 4.4% to EUR 22,853 million. This was due to the net impact of several factors.

• On the one hand, there was a positive effect from the moderate increase in volumes and the improvement in the spreads on loans for the whole Group (from 3.59% to 3.84%).

• Spreads on deposits which compare negatively with previous quarters, are already at the same levels (0.30% in 2010 and 0.29% in 2011).

10 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

• Negative impact from the higher cost of wholesale funding and the greater regulatory requirements for liquidity in some countries, mainly the UK.

• Net fee income increased 10.0%, with a favourable performance of those from insurance and services. The latter showed rises in almost all lines: cards, demand deposits, etc. On the other hand, income from securities and custody was lower and virtually unchanged from mutual and pension funds.

NET FEES
Million euros

					Variation
	9M’11		9M’10		Amount			(%)
Fees from services		4,678		4,205		473			11.3
Mutual & pension funds		945		951		(6	)		(0.6	)
Securities and custody		508		587		(79	)		(13.5	)
Insurance		1,886		1,546		340			22.0
Net fee income		8,017		7,290		728			10.0

• Gains on financial transactions increased 6.8%, year-on-year, largely due to Corporate Activities (positive impact of hedging exchange rates compared to losses in 2010), as the operating areas declined because of lower GBM gains, for two reasons. The second and third quarters of 2011 were weak, affected by the environment, whereas in 2010 gains were very high. The relative share of gains on financial transactions in total revenues remained very low at 6%.

• The rest of revenues (dividends, income accounted for by the equity method and other operating income) rose 1.5% to EUR 366 million.

Gross income in the third quarter was 5.2% higher than in the same period of 2010, due to the good performance of basic revenues (+5.3%), and 1.5% lower between the third and second quarters of 2011, because gains on financial transactions were lower (affected by the environment) and also dividends received (seasonal effect), as basic revenues remained stable over the second quarter.

OPERATING EXPENSES
Million euros

					Variation
	9M’11		9M’10		Amount			(%)
Personnel expenses		7,682		6,908		774			11.2
General expenses		5,468		5,180		287			5.5
Information technology		670		633		36			5.7
Communications		510		491		19			3.9
Advertising		494		467		27			5.7
Buildings and premises		1,230		1,162		68			5.9
Printed and office material		126		140		(13	)		(9.5	)
Taxes (other than profit tax)		294		269		25			9.3
Other expenses		2,144		2,018		126			6.2
Personnel and gen. expenses		13,150		12,088		1,061			8.8
Depreciation and amortisation		1,575		1,409		166			11.8
Total operating expenses		14,725		13,498		1,227			9.1

Operating expenses rose 9.1% year-on-year and 6.3% excluding the perimeter and exchange rate effects. The year-on-year performance varied throughout the Group.

In Europe, both the large retail units (Santander Branch Network, Banesto and Portugal) as well as the UK recorded falls in expenses in real terms. Of note were the reductions of 1.8% in Portugal, 1.7% in Banesto and around 1% in the Santander Branch Network.

The global units (GBM and Asset Management) registered higher growth in expenses (+5.9%) because of investments in equipment and technology with the double purpose of strengthening the positions attained in key markets and businesses in previous years, and developing new initiatives, such as the distribution of fixed income products in Europe.

In Latin America, the 11.4% rise (at constant exchange rates) is linked to the drive in new commercial projects, the increase in installed capacity, the restructuring of points of attention, particularly in Brazil, and the revision of collective bargaining agreements in an environment of higher inflation.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 11

CONSOLIDATED FINANCIAL REPORT

NET LOAN-LOSS PROVISIONS
Million euros

							Variation
	9M’11			9M’10			Amount			(%)
Non performing loans		9,017			8,700			317			3.6
Country-risk		5			(2	)		7			—
Recovery of written-off assets		(1,245	)		(844	)		(401	)		47.6
Total		7,777			7,854			(78	)		(1.0	)

Lastly, Sovereign also shows in the comparison with the same period of 2010 (+8.1% in dollars) the impact of investments in technology and commercial structure begun in the second half of 2010.

Net operating income in the first nine months was EUR 18,529 million, 3.3% more than in the same period of 2010 (+2.0% without the perimeter and exchange rate effects) and better than in the first half.

This performance showed the Group’s capacity to continue to generate revenues in a difficult context and comfortably absorb the provisions made for loan losses, which at EUR 7,777 million were 1.0% less than in the first nine months of 2010 (-1.8% excluding the perimeter and exchange rate effects). This was due to the reduced release of generic provisions, as specific ones declined 9.5%, favoured by the charge in the third quarter of 2010 related to Circular 3/2010 of the Bank of Spain.

Similar comments can be made for Spain, where total provisions dropped 1.0% and specific ones 33.7% (-15.1% excluding the impact of the Bank of Spain Circular). There were significant reductions in provisions in the UK, Latin America ex-Brazil, Sovereign and Santander Consumer Finance (including the incorporation of new units). There were rises in Portugal, reflecting the economic difficulties, and in Brazil because of the greater growth in the balance sheet and an increase in the sector’s NPLs in the first half of the year.

Net operating income after provisions was EUR 10,752 million, 6.6% more than in the first nine months of 2010 (+5.0% excluding the perimeter and exchange-rate impacts).

There were strong rises in these results (without the perimeter and exchange-rate effects) in Santander Consumer Finance (+59.5%) and Sovereign (+58.5%) and more moderate in Brazil (+3.2%) and Latin America ex-Brazil (+1.0%). On the other hand there were declines in the UK (-3.9%), after absorbing the significant effects of the regulatory changes, as commented on in greater detail in the relevant section, Spain (-23.1%) and Portugal (-43.9%).

Asset impairment losses and other results were EUR 2,474 million negative compared to EUR 1,218 million, also negative, in the first nine months of 2010, largely due to the provision made in the second quarter for EUR 842 million gross for payment protection insurance remediation (PPI) in the UK.

Profit before tax was 6.6% lower year-on-year at EUR 8,278 million (-8.6% excluding the perimeter and exchange rate effects). The tax charge increased 12.3% to EUR 2,302 million, mainly due to Brazil, Latin America ex-Brazil, Sovereign and Corporate Activities.

The profit from continued operations, after the tax charge, was EUR 5,977 million (-12.3% y-o-y). Attributable profit, after incorporating discontinued operations and minority interests, was EUR 5,303 million (-12.8% y-o-y).

Earnings per share in the first nine months were EUR 0.5981, 14.7% less than in the same period of 2010. These items were slightly affected by the capital increases in 2010 and the beginning of 2011 to convert Valores Santander (convertible bonds) and tend to the remuneration in shares for those shareholders than chose this option, as no adjustment was made retroactively to the number of shares of previous periods.

All the figures pertaining to profits are affected by the extraordinary provision for PPI made in the second quarter, as already commented on. Excluding this provision, attributable profit reached EUR 5,923 million, 2.6% less than in the same period of 2010. Earnings per share were EUR 0.6680 (-4.7% lower y-o-y).

The Group’s ROE was 9.5% and ROTE (measured as attributable profit / shareholders equity less goodwill) was 14.3%.

12 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

BALANCE SHEET
Million euros

							Variation
	30.09.11			30.09.10			Amount			(%)			31.12.10
ASSET
Cash on hand and deposits at central banks		84,050			69,183			14,867			21.5			77,785
Trading portfolio		191,440			180,566			10,874			6.0			156,762
Debt securities		60,033			58,085			1,948			3.4			57,871
Customer loans		1,973			612			1,361			222.4			755
Equities		6,432			7,746			(1,314	)		(17.0	)		8,850
Trading derivatives		102,217			93,855			8,362			8.9			73,069
Deposits from credit institutions		20,785			20,267			518			2.6			16,216
Other financial assets at fair value		27,875			41,611			(13,736	)		(33.0	)		39,480
Customer loans		11,039			9,446			1,593			16.9			7,777
Other (deposits at credit institutions, debt securities and equities)		16,836			32,166			(15,330	)		(47.7	)		31,703
Available-for-sale financial assets		79,410			83,191			(3,781	)		(4.5	)		86,235
Debt securities		73,875			76,477			(2,602	)		(3.4	)		79,689
Equities		5,535			6,714			(1,179	)		(17.6	)		6,546
Loans		772,144			773,021			(877	)		(0.1	)		768,858
Deposits at credit institutions		43,778			58,045			(14,267	)		(24.6	)		44,808
Customer loans		721,291			705,584			15,707			2.2			715,621
Debt securities		7,075			9,392			(2,317	)		(24.7	)		8,429
Investments		1,212			283			928			327.5			273
Intangible assets and property and equipment		17,102			12,969			4,133			31.9			14,584
Goodwill		25,914			23,928			1,986			8.3			24,622
Other		51,330			50,959			370			0.7			48,901
Total assets		1,250,476			1,235,712			14,764			1.2			1,217,501
LIABILITIES AND SHAREHOLDERS’ EQUITY
Trading portfolio		168,751			157,895			10,856			6.9			136,772
Customer deposits		15,368			5,567			9,801			176.1			7,849
Marketable debt securities		1,507			380			1,127			296.8			365
Trading derivatives		101,557			94,292			7,265			7.7			75,279
Other		50,318			57,656			(7,338	)		(12.7	)		53,279
Other financial liabilities at fair value		66,940			48,942			17,997			36.8			51,020
Customer deposits		43,415			29,074			14,341			49.3			27,142
Marketable debt securities		8,432			7,918			514			6.5			4,278
Due to central banks and credit institutions		15,093			11,951			3,142			26.3			19,600
Financial liabilities at amortized cost		887,244			902,505			(15,261	)		(1.7	)		898,969
Due to central banks and credit institutions		93,435			82,468			10,968			13.3			79,537
Customer deposits		561,128			566,653			(5,524	)		(1.0	)		581,385
Marketable debt securities		187,750			200,138			(12,388	)		(6.2	)		188,229
Subordinated debt		25,848			32,287			(6,440	)		(19.9	)		30,475
Other financial liabilities		19,082			20,959			(1,877	)		(9.0	)		19,343
Insurance liabilities		9,894			6,527			3,367			51.6			10,449
Provisions		15,198			16,756			(1,558	)		(9.3	)		15,660
Other liability accounts		24,160			26,827			(2,667	)		(9.9	)		23,717
Total liabilities		1,172,187			1,159,453			12,734			1.1			1,136,586
Shareholders’ equity		79,144			73,753			5,391			7.3			77,334
Capital stock		4,220			4,114			106			2.6			4,165
Reserves		70,762			64,672			6,091			9.4			66,258
Attributable profit to the Group		5,303			6,080			(777	)		(12.8	)		8,181
Less: dividends		(1,141	)		(1,113	)		(29	)		2.6			(1,270	)
Equity adjustments by valuation		(6,519	)		(2,866	)		(3,653	)		127.4			(2,315	)
Minority interests		5,664			5,372			292			5.4			5,896
Total equity		78,289			76,259			2,030			2.7			80,914
Total liabilities and equity		1,250,476			1,235,712			14,764			1.2			1,217,501

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 13

CONSOLIDATED FINANCIAL REPORT

GRUPO SANTANDER BALANCE SHEET

Activity continued to reflect the market context:

• Lower demand for loans in developed markets (-6% in Spain and -13% in Portugal).

• Growth of 19% in lending in Latin America.

• In funds, special watch on costs and preference for deposits throughout the Group.

Core capital at 9.42%, very solid as befits Grupo Santander’s business model and risk profile.

Shareholders’ equity per share increased again (+EUR 0.18 in the third quarter and +EUR 0.33 in the first nine months) to EUR 8.91.

Total managed funds at the end of September amounted to EUR 1,382,920 million, of which EUR 1,250,476 million (90%) were on-balance sheet and the rest off-balance sheet mutual and pension funds and managed portfolios.

Two factors need to be taken into account in the year-on-year comparisons:

• A positive impact from the perimeter effect of incorporating to the Group the retail banking business of SEB in Germany (Santander Retail) in Santander Consumer Finance, the consolidation of Bank Zachodni WBK in Poland and the purchase of a mortgage portfolio in Mexico.

• A negative one from the depreciation against the euro (end of period rates) of the sterling (1%), the Mexican peso (8%), the Brazilian real (7%) and the Chilean peso (6%). The dollar appreciated 1% against the euro.

The joint impact on changes in customer balances was two percentage points negative in lending and in customer funds.

Lending

The Group’s net lending amounted to EUR 734,302 million, 3% higher than in September 2010. Eliminating the exchange rate and perimeter effects it was 4% higher.

The geographic distribution (principal segments) was also very different by markets.

In Continental Europe, Spain and Portugal’s lending fell by 6% and 13% respectively over September 2010, due to deleveraging. Santander Consumer Finance’s lending increased 10%, partly due to the perimeter effect. The incorporation of Bank Zachodni WBK increased the Group’s net lending by EUR 8,219 million.

14 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

CUSTOMER LOANS
Million euros

					Variation
	30.09.11		30.09.10		Amount			(%)			31.12.10
Public sector		12,340		12,054		286			2.4			12,137
Other residents		205,225		217,421		(12,196	)		(5.6	)		217,497
Commercial bills		9,075		10,203		(1,128	)		(11.1	)		11,146
Secured loans		121,016		128,360		(7,344	)		(5.7	)		127,472
Other loans		75,135		78,858		(3,723	)		(4.7	)		78,879
Non-resident sector		536,267		505,753		30,514			6.0			514,217
Secured loans		326,079		307,683		18,397			6.0			311,048
Other loans		210,187		198,070		12,118			6.1			203,168
Gross customer loans		753,832		735,227		18,604			2.5			743,851
Loan-loss allowances		19,529		19,586		(56	)		(0.3	)		19,697
Net customer loans		734,302		715,642		18,661			2.6			724,154
Pro memoria: Doubtful loans		30,124		26,659		3,465			13.0			27,908
Public sector		88		33		56			171.4			42
Other residents		13,708		11,232		2,476			22.0			12,106
Non-resident sector		16,328		15,394		934			6.1			15,759

• Gross lending in Spain amounted to EUR 226,383 million, with an adequate structure (details further on).

Loans to the public sector amounted to EUR 12,340 million, +2.4% in the last twelve months.

Lending to individuals amounted to EUR 86,099 million, of which EUR 58,554 million were mortgages for homes. These are the healthiest part and with the least risk of further deterioration of the portfolio in Spain because of the different features of this product compared to similar ones in other countries. For example, the principle is amortised as of the first day, the borrowers’ responsibility extends to all their assets and almost all loans are for residences in ownership, with a very low expected loss.

In the specific case of Grupo Santander, the portfolio is mostly composed of mortgages that are for the first residence, with an expected loss of around 0.6%. There is a large concentration of loans in the lowest tranches of loan-to-value (87% with an LTV lower than 80%) and the NPL ratio is very low (2.5%).

Loans to SMEs and companies amounted to EUR 104,067 million.

Loans to the construction and real estate sector, for real estate purposes (the one with the greatest risk) stood at EUR 24,369 million, after falling further in the quarter (-EUR 978 million). The total reduction for the year was EUR 2,965 million (-11%).

The Group maintained in the year the strategy of previous years to reduce exposure to this segment of greater risk. The total reduction in the last three years amounts to EUR 13,300 million (-35%).

In relative terms, this figure is also declining and represents only 3.2% of the Group’s lending and 10.8% of its total loans in Spain.

• In Portugal, the fall in lending (13% year-on-year) was mainly due to large companies, as there was a shift from loans to capital markets. In addition, balances in construction and real estate, which represent only 4% of lending, declined 9% in the year to September 2011. Balances with individuals dropped 2%.

• Santander Consumer Finance’s balance increased 10% since September 2010, due to organic growth and the integration of Germany, as commented on in greater detail in the section on this area. New loans were 12% higher year-on-year.

In the United Kingdom, the balance of customer loans remained stable in the last 12 months. In local criteria, residential mortgages, in a still depressed market, were stable, while loans to SMEs increased 27%, gaining further market share. Personal loans, reflecting the policy in the last few years of reducing them, declined 15% year-on-year.

Lending in Latin America increased 19% year-on-year excluding the exchange rate impact, due to organic growth and the incorporation of GE’s mortgage portfolio in Mexico. Loans rose 19% in local currency in Brazil, 14% in Chile and 32% in Mexico (+24% excluding the impact of the portfolio acquired).

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 15

CONSOLIDATED FINANCIAL REPORT

CUSTOMER FUNDS UNDER MANAGEMENT
Million euros

					Variation
	30.09.11		30.09.10		Amount			(%)			31.12.10
Public sector		6,994		11,935		(4,941	)		(41.4	)		9,655
Other residents		161,571		157,895		3,676			2.3			161,096
Demand deposits		67,523		66,505		1,018			1.5			67,077
Time deposits		64,875		81,300		(16,425	)		(20.2	)		81,145
REPOs		29,172		10,090		19,082			189.1			12,873
Non-resident sector		451,346		431,463		19,883			4.6			445,625
Demand deposits		215,260		206,923		8,337			4.0			210,490
Time deposits		194,539		190,920		3,619			1.9			197,590
REPOs		32,034		27,303		4,731			17.3			30,623
Public Sector		9,514		6,317		3,196			50.6			6,922
Customer deposits		619,911		601,293		18,618			3.1			616,376
Debt securities		197,689		208,435		(10,746	)		(5.2	)		192,872
Subordinated debt		25,848		32,287		(6,440	)		(19.9	)		30,475
On-balance-sheet customer funds		843,448		842,016		1,432			0.2			839,723
Mutual funds		103,755		107,833		(4,079	)		(3.8	)		113,510
Pension funds		9,893		10,865		(972	)		(8.9	)		10,965
Managed portfolios		18,796		20,726		(1,931	)		(9.3	)		20,314
Savings-insurance policies		707		2,755		(2,048	)		(74.4	)		758
Other customer funds under management		133,150		142,179		(9,030	)		(6.4	)		145,547
Customer funds under management		976,598		984,195		(7,597	)		(0.8	)		985,269

Sovereign’s loans rose 5% in dollars in local criteria, due to the increase in the most attractive mortgage segments (residential and multifamily), which grew 10% year-on-year, and the acquisition in January 2011 of a consumer credit portfolio from GE. Both effects comfortably offset the exit from higher risk segments and from those not considered strategic for the Group.

At the end of the third quarter, Continental Europe accounted for 45% of the Group’s total lending (30% Spain), the UK 33%, Latin America 17% (10% Brazil) and Sovereign 5%.

If the comparison is made between the months of September and June, and excluding the perimeter and exchange rate effects, loans increased 1%, with the following structure: Continental Europe (-1%), the same as Spain; the UK (+2%);Latin America (+7% and +9% for Brazil) and Sovereign remained unchanged.

Customer funds under management

Total managed funds at the end of September amounted to EUR 976,598 million, 1% lower year-on-year.

After deducting the perimeter and forex effects, which had a negative impact, the increase was 1% distributed as follows: 2% drop in total deposits without repos (demand deposits: +1%; time: -6%), the aggregate of mutual and pension funds declined 3% and the balance of repos, marketable securities and subordinated debt rose 3%.

16 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

MUTUAL FUNDS
Million euros

	30.09.11		30.09.10		Var (%)
Spain		28,331		38,257		(25.9	)
Portugal		2,159		3,496		(38.2	)
Poland		1,888
United Kingdom		14,686		13,704		7.2
Latin America		56,691		52,377		8.2
Total		103,755		107,833		(3.8	)

Deposits grew 3% in Continental Europe.

• In Spain, the strategy followed in the renewal of funds captured in the campaign of 2010 was to give priority to improved costs over volumes. As a result, deposits without repos fell 11% year-on-year. However, if one compares the balances at the start of the campaign with those at the end of September, growth was more than EUR 21,000 million (+16%).

• Santander Consumer Finance’s deposits increased 34% year-on-year and Portugal’s 15%. The liquidity position was significantly better.

• The incorporation of Bank Zachodni WBK contributed EUR 12,127 million to the Group, of which EUR 9,936 million were deposits.

In the UK, customer deposits increased 4% in sterling year-on-year and mutual funds rose 8%.

In Latin America, deposits grew 23% in Chile, 13% in Mexico and 4% in Brazil, with generalised growth in time and demand deposits, except for Brazil in the latter, which remains virtually flat. Mutual funds increased 24% in Brazil, 4% in Mexico and declined 5% in Chile. Bank savings excluding the exchange rate effect rose 11%.

PENSION FUNDS
Million euros

	30.09.11		30.09.10		Var (%)
Spain		8,910		9,551		(6.7	)
Portugal		983		1,314		(25.2	)
Total		9,893		10,865		(8.9	)

Lastly, Sovereign’s deposits increased 15% in dollars in the last 12 months.

Continental Europe accounted at the end of September for 39% of managed customer funds (28% Spain), the UK 31%, Latin America 26% (Brazil 15%) and Sovereign 4%.

Taking just the third quarter, and eliminating the impact of exchange rates, managed funds declined 1%. In Continental Europe and the UK they dropped 3%, rose 1% in Latin America and remained stable at Sovereign.

As well as capturing large volumes of funds in the last 18 months, the Group, for strategic reasons, maintained an active policy of issuing securities in the international fixed income markets.

The Group issued in the first nine months of 2011 EUR 21,470 million, EUR 14,383 million and EUR 262 million of senior debt, covered bonds and subordinated debt, respectively.

This issuing activity underscore the Group’s capacity via its parent bank, Banco Santander, and its main subsidiaries to access the different institutional markets in the countries where it operates: Banesto, Santander Totta, Santander UK/Chile/Brazil/Mexico, Sovereign and the units of Santander Consumer Finance, although at higher prices because of the markets’ situation.

As regards securitisations, the Group’s subsidiaries placed in the market during the first nine months a total of EUR 19,559 million.

Issues of senior debt, covered bonds and subordinated debt that matured in this period were EUR 14,825 million, EUR 6,200 million and EUR 4,509 million, respectively.

This capturing of stable funds, via deposits and issues, combined with the trend of reduced growth in lending, brought the loan-to-deposit ratio to 118% (119% in September 2010). The ratio of deposits plus medium and long-term funding to the Group’s loans increased to 116%, underscoring the appropriate structure of funding the Group’s lending.

The Group’s access to wholesale funding markets, as well as the cost of issues depends partly on our credit ratings. A downgrade in our credit ratings could increase the cost of issues and reduce our access to funding in general.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 17

CONSOLIDATED FINANCIAL REPORT

RATING AGENCIES

	Long	Short		Financial
	term	term		strength
Standard & Poor’s	AA-		A1 +
Fitch Ratings	AA-		F1 +		A/B
Moody’s	Aa3		P1		B-
DBRS	AA		R1(high)

At the time of publication of this report, the Group’s long-term ratings were investment grade from the main rating agencies, as follows:

The rating agencies regularly review the Group and its ratings. The long-term debt rating depends on a series of factors including financial solvency and other circumstances that generally affect the financial industry. The latest reviews are as follows:

• DBRS confirmed in August the long-term debt rating at AA, changing the outlook from stable to negative after doing the same for Spanish sovereign debt.

• Fitch Ratings on October 11 downgraded six Spanish banks, indicating that this was due to the downgrade of the Kingdom of Spain to AA-, as well as to the fact that banks worldwide and particularly in Europe, face challenges in fundamentals and in the markets. As a result, Fitch ratings for the Group are AA- with negative outlook.

• Also on October 11, Standard & Poor’s downgraded Spanish banks because it believes the sluggish growth prospects, the still depressed real estate market and increased turbulence in capital markets will impact financial entities in the coming months. The Group long-term debt ratings are AA- with negative outlook.

• Moody’s on October 19 also downgraded Spanish entities as a result of downgrading Spain’s sovereign debt to A1. The long-term debt ratings of Banco Santander were downgraded from Aa2 to Aa3, maintaining a negative outlook.

All the agencies confirmed their short-term debt ratings.

Other items of the balance sheet

Total goodwill was EUR 25,914 million at the end of September, EUR 1,986 million more than a year earlier because of the net impact of the entry of BZ WBK, Santander Retail in Germany and GE’s portfolio in Mexico and the reduction caused by exchange rates.

Of note in the rest of the items were:

• Cash on hand and deposits in central banks rose from EUR 69,183 million in September 2010 to EUR 84,050 million a year later, mainly located in Brazil and the UK, due to the tougher regulations on liquidity requirements established by their central banks, and in Spain.

• Trading derivatives increased, both in assets as well as liabilities (+EUR 8,362 million and +EUR 7,265 million, respectively), due to the evolution of the market value, mainly of interest rate swaps. The balance at the end of September was EUR 102,217 in assets and EUR 101,557 million in liabilities.

TOTAL EQUITY AND CAPITAL WITH THE NATURE OF FINANCIAL LIABILITIES
Million euros

							Variation
	30.09.11			30.09.10			Amount			(%)			31.12.10
Capital stock		4,220			4,114			106			2.6			4,165
Additional paid-in surplus		29,446			29,305			141			0.5			29,457
Reserves		41,592			35,554			6,039			17.0			36,993
Treasury stock		(276	)		(187	)		(89	)		47.5			(192	)
Shareholders’ equity (before profit and dividends)		74,982			68,786			6,196			9.0			70,423
Attributable profit		5,303			6,080			(777	)		(12.8	)		8,181
Interim dividend distributed		(1,141	)		(1,113	)		(29	)		2.6			(1,270	)
Interim dividend not distributed		—			—			—			—			(2,060	)
Shareholders’ equity (after retained profit)		79,144			73,753			5,391			7.3			75,273
Valuation adjustments		(6,519	)		(2,866	)		(3,653	)		127.4			(2,315	)
Minority interests		5,664			5,372			292			5.4			5,896
Total equity (after retained profit)		78,289			76,259			2,030			2.7			78,854
Preferred shares and securities in subordinated debt		7,125			7,177			(52	)		(0.7	)		7,352
Total equity and capital with the nature of financial liabilities		85,414			83,436			1,978			2.4			86,207

18 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

CONSOLIDATED FINANCIAL REPORT

Shareholders’ equity and solvency ratios

Total shareholders’ equity, after retained profit, was 7% higher year-on-year at EUR 79,144 million (+EUR 5,391 million), due to the increase in reserves.

Including minority interests, preference shares and valuation adjustments, total net equity and capital with the nature of financial liabilities stood at EUR 85,414 million at the end of September (+EUR 1,978 million in 12 months). The change in valuation adjustments over September 2010 (-EUR 3,653 million), was basically due to the negative impact on the value of subsidiaries abroad of exchange rates (partly covered by hedging). It also includes the negative impact of exchange rates on goodwill, neutral in terms of capital ratios as the same happened on the asset side.

As regards capital ratios, Grupo Santander’s eligible shareholders’ equity, in accordance with the criteria of the Bank for International Settlements (BIS II), amounted to EUR 74,008 million (EUR 29,305 million surplus, 66% above the minimum requirement).

The core capital ratio was 9.42%, after improving 22 b.p. in the quarter. Since the end of 2010 increased 62 b.p., after absorbing the impact of the incorporation of BZ WBK and of the one-off related to the UK (PPI), both in the second quarter.

The core capital is of very high quality, solid and adjusted to our risk profile.

Tier I was 10.74% and the BIS ratio 13.24%.

Lastly, of note is the Group’s sustained capacity to generate retained profits, after deducting dividends in accordance with the Group’s pay-out policy. At the end of September, shareholders’ equity per share was EUR 8.91 (+EUR 0.33 since the end of 2010), an increase that is added to those in the last four years.

COMPUTABLE CAPITAL AND BIS II RATIO
Million euros

							Variation
	30.09.11			30.09.10			Amount			(%)			31.12.10
Core capital		52,638			50,307			2,331			4.6			53,205
Basic capital		60,030			57,718			2,312			4.0			60,617
Supplementary capital		16,480			21,468			(4,987	)		(23.2	)		20,670
Deductions		(2,502	)		(2,118	)		(383	)		18.1			(2,011	)
Computable capital		74,008			77,067			(3,059	)		(4.0	)		79,276
Risk-weighted assets		558,789			593,693			(34,904	)		(5.9	)		604,885
BIS II ratio		13.24			12.98			0.26	p.					13.11
Tier I (before deductions)		10.74			9.72			1.02	p.					10.02
Core capital		9.42			8.47			0.95	p.					8.80
Shareholders’ equity surplus (BIS II ratio)		29,305			29,572			(267	)		(0.9	)		30,885

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 19

RISK MANAGEMENT

RISK MANAGEMENT

• Prudent risk management that mitigates the impact of the deterioration of the economic environment in some markets.

• The Group’s NPL ratio was 3.86% (+8 b.p in the quarter) and coverage 66%.

• Strong improvement in the quarter at Sovereign and SCF and stability in the other large units, except in Spain, whose NPL ratio remains on an upward trend.

• Loans with real estate purposes in Spain declined EUR 978 million in the quarter (-EUR 2,965 million, -11%, since December 2010). Their share in the Group’s total lending dropped to 3.2%.

Credit risk

The still weak economic growth in some countries is continuing to produce rises in non-performing loans (NPLs), linked to both the increase in bad and doubtful loans as well as to the slower pace of growth in lending.

Active management of the portfolio is reflected in an improvement in the risk premium for the whole Group and its main business units, which led to a slower pace of growth in NPLs in the last few quarters.

The risk premium was 1.67% at the end of September, well below the high of 2.47% in the third quarter of 2009.

Bad and doubtful loans stood at EUR 30,910 million at the end of September, 13.7% more than a year earlier.

Grupo Santander’s NPL ratio was 3.86%, 8 b.p. more than at the end of June 2011 and +44 b.p. since September 2010, partly affected by the incorporation of BZ WBK and the portfolio acquired in Mexico whose NPL ratio is higher than the Group’s average (3.82% excluding this impact).

Total loan loss provisions amounted to EUR 20,403 million, of which EUR 5,103 million (25%) were generic provisions.

Loan-loss provisions have risen by EUR 7,540 million since the end of 2008 (+59%), underscoring the effort made in the last three years. Coverage was 66%.

•	The NPL ratio in Spain is 5.15%, well below that of the banking sector as a whole, and coverage 46%. The ratio increased 34 b.p. in the third quarter and 127 b.p. in 12 months,
	In Spain, 90% of the portfolio (including mortgages and companies) has an excellent NPL ratio of 3.2%. The ratio for mortgages for homes is 2.5%, while the remainder of the portfolio, (public sector, individual customers and companies without real estate purposes) has a ratio of 3.4%. NPLs remain stable in both cases in the last quarter.

20 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

RISK MANAGEMENT

The higher total NPL ratio, therefore, is because of the NPL ratio of the real estate and construction sector with real estate purposes (24.9%). This ratio reflects, on the one hand, the higher NPL ratio in the segment of the economy and, on the other, the Group’s anticipative policy.

This policy is reflected in the fact that of the EUR 6,062 million recorded as doubtful loans, around 40% is up to date with payments. In addition, EUR 3,425 million is recorded as substandard, all of which is also up to date with payments. In other words, more than 60% of non-performing and substandard loans are up to date with payments and provisions and guarantees adequately cover both of them.

At the end of September, the net balance of acquired and foreclosed assets amounted to EUR 5,810 million, with coverage of 32%, in line with the needs according to valuations. This coverage is above the Bank of Spain’s minimum requirement.

• In Portugal, the NPL ratio increased 53 b.p. in the third quarter and 135 b.p. in the last 12 months to 3.78%, while coverage remained stable at 53%, 9 p.p. and 16 p.p., respectively, lower than June 2011 and September 2010.

• Santander Consumer Finance reduced its NPL ratio for the fifth quarter running, to 4.29% (13 b.p. less in the quarter and -84 b.p. in 12 months). Coverage was 132%, 4 p.p. more than in the second quarter and 10 p.p. above September 2010.

• In the UK, the NPL ratio was 1.88%. It increased 6 b.p. in the quarter and 11 b.p. in 12 months, while coverage was 40%, below the 41% in June 2011 and the 48% in September 2010.

Of note in the Group’s total lending are residential mortgages in the UK. This portfolio has evolved favourably. Its NPL ratio at the end of September was 1.42% compared to 1.47% a year earlier. This improvement was due to constant monitoring and control, as well as strict credit policies that include, among other measures, maximum loan-to-value criteria in relation to the properties in guarantee. At the end of September, the average LTV was 52%.

Another indicator of this portfolio’s good performance is the low volume of foreclosed properties, which amounted to EUR 151 million and accounted for only 0.08% of the total mortgage exposure. Efficient management of these cases and the existence of a dynamic market for this type of home, which enables a quick sale, contributed to the good results.

• Brazil’s NPL ratio was 5.05%, the same as in the second quarter and 8 b.p. above September 2010. Coverage, which has hardly changed in seven quarters, was around 100%.

• Latin America ex—Brazil’s NPL ratio was 2.91%, with an excellent coverage of 108%. Its comparison is affected by the incorporation in the second quarter of GE’s portfolio in Mexico. Excluding this, the ratio was 2.84%, 27 b.p. less than in September 2010, while coverage would be 111%, 2 p.p. below September 2010.

CREDIT RISK MANAGEMENT *
Million euros

					Variation
	30.09.11		30.09.10		Amount			(%)			31.12.10
Non-performing loans		30,910		27,195		3,716			13.7			28,522
NPL ratio (%)		3.86		3.42		0.44	p.					3.55
Loan-loss allowances		20,403		20,490		(87	)		(0.4	)		20,748
Specific		15,300		14,008		1,292			9.2			14,901
Generic		5,103		6,482		(1,378	)		(21.3	)		5,846
NPL coverage (%)		66		75		(9	p.)					73
Credit cost (%) **		1.44		1.65		(0.21	p.)					1.56
Ordinary non-performing and doubtful loans ***		18,412		17,028		1,384			8.1			18,061
NPL ratio (%) ***		2.33		2.17		0.16	p.					2.28
NPL coverage (%) ***		111		120		(10	p.)					115

*	Excluding country-risk
**	Net specific allowance / computable assets
***	Excluding mortgage guarantees

Note: NPL ratio: Non-performing loans / computable assets

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 21

RISK MANAGEMENT

NON-PERFORMING LOANS BY QUARTER
Million euros

	Q1’10			Q2’10			Q3’10			Q4’10			Q1’11			Q2’11			Q3’11
Balance at beginning of period		24,554			25,512			27,325			27,195			28,522			28,494			30,186
Net additions		3,423			3,389			2,895			3,771			3,112			4,015			4,206
Increase in scope of consolidation		—			—			254			3			186			739			(0	)
Exchange differences		420			1,307			(1,060	)		480			(558	)		(31	)		(444	)
Write-offs		(2,885	)		(2,884	)		(2,219	)		(2,926	)		(2,767	)		(3,031	)		(3,037	)
Balance at period-end		25,512			27,325			27,195			28,522			28,494			30,186			30,910

• Sovereign’s NPL ratio (3.22%) improved for the seventh consecutive quarter (54 b.p. less than June 2011 and 158 b.p. below September 2010). Coverage rose 8 p.p. in the quarter to 93%, 21 p.p. more than September 2010.

The Group’s net specific loan loss provisions deducting recovered write-offs amounted to EUR 8,255 million in the first nine months of 2011, 1.44% of average credit risk (last 12 months), compared to EUR 9,126 million and 1.65% in the same period of 2010, which included the provision resulting from the Bank of Spain’s change in regulations in September 2010.

Total net provisions represented 1.4% of credits, much lower than net operating income generated for the Group as a percentage of credits (3.4%).

Market risk

The risk of trading activity, measured in VaR terms at 99%, averaged around EUR 23.6 million in the third quarter. It fluctuated between EUR 19.3 and EUR 32.2 million.

The maximum for the quarter was reached on July 11 as a result of the VaR increase in Brazil from the greater risk in exchange rates and increased volatility. The VaR then declined, mainly due to the reduction in exchange rate and interest rate risk in Brazil. As of then, it kept fluctuaring within a narrow range and on September 16 reached a minimum of EUR 19.3 million.

TRADING PORTFOLIOS*. VaR BY REGION
Third quarter

	2011				2010
Million euros	Average		Latest		Average
Total		23.6		23.7		27.6
Europe		16.6		11.2		13.8
USA and Asia		1.1		0.9		1.4
Latin America		11.4		10.0		15.1
Global activities		11.5		10.6		16.0

(*). - Trading activity

TRADING PORTFOLIOS*. VaR BY MARKET FACTOR
Third quarter 2011

Million euros	Min			Avg			Max			Latest
VaR total		19.3			23.6			32.2			23.7
Diversification effect		(12.2	)		(21.4	)		(31.3	)		(21.0	)
Interest rate VaR		8.8			13.9			21.8			12.6
Equity VaR		2.2			4.6			9.3			6.3
FX VaR		5.1			9.4			24.1			6.3
Credit spreads VaR		11.5			16.3			21.0			19.1
Commodities VaR		0.3			0.7			1.2			0.5

(*). - Trading activity

22 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

THE SANTANDER SHARE

THE SANTANDER SHARE

Shareholder remuneration

In line with its policy, Banco Santander paid on August 1 the first interim dividend charged to 2011’s earnings of EUR 0.135 gross per share, the same as in 2010.

In accordance with the scrip dividend programme (Santander Dividendo Elección), shareholders can choose to receive the amount equivalent to the second interim dividend in cash or in shares. Every shareholder has a free allotment right of new shares for each share owned. Shareholders can sell the rights to the Bank at a set price (EUR 0.126 gross per right), on the stock market between October 17 and 31 at the market price, or receive new shares in the proportion of one new share for every 49 rights, and in the last two cases without withholding tax(*).

In order to meet this, there will be a rights issue for a maximum of EUR 86,137,739, represented by 172,275,478 shares. The number of new shares to be issued, and thus the amount of the capital increase, will depend on the number of shareholders who opt to sell their free allotment rights to the Bank at a set price.

Shareholders are due to receive on November 3 the amount in cash if they opted to sell their rights to the Bank, and on November 9 the new shares those who chose this option.

Share price performance

Financial tensions in the euro zone intensified in the last quarter, affecting the sovereign debt of various countries and the evolution of markets. In this context, the European Central Bank reactivated in August its programme to buy debt in order to reduce tensions. In September, with insolvency fears in Greece, the ECB, the US Federal Reserve, the Bank of England, the Bank of Japan and the National Bank of Switzerland agreed to inject liquidity into the financial system until the end of the year.

Another aspect that also affected the markets was the worsening of global growth prospects.

The Santander share ended September at EUR 6.224, 21.8% lower than in June and a larger fall than the Ibex-35 (-17.5%) and the DJ Stoxx 50 (-15.7%), but better than the DJ Stoxx Banks (-28.0%).

(*) The options, maturities and procedures indicated can present special features for shareholders holding Santander shares in the various foreign stock markets where the Bank is listed.

Market capitalisation

At September 30, Santander was the largest bank in the euro zone by market capitalisation and the ninth in the world (EUR 52,532 million). The share’s weighting in the DJ Stoxx 50 index was 2.32%, 9.93% in the DJ Stoxx Banks and 16.74% in the Ibex-35.

Trading

The Santander share is one of the 10 most liquid stocks in the world and the most liquid of the DJ Stoxx 50.

A total of 20,829 million shares were traded in the first nine months of 2011 for an effective value of EUR 160,466 million with a liquidity ratio of 247%. The average daily turnover was 108 million shares for an effective value of EUR 831 million.

Shareholders

There were 3,263,997 shareholders at September 30, of which 2,995,271 were European (86.74% of the capital stock) and 252,979 were from the Americas (12.94%).

Excluding the Board, which holds 2.94% of the Bank’s capital, individual shareholders held 42.49% of the capital at the end of September and institutional ones 54.57%.

CAPITAL STOCK OWNERSHIP

September 2011	Acciones		%
The Board of Directors		248,033,833		2.94
Institutional Investors		4,606,112,311		54.57
Individuals		3,586,128,860		42.49
Total		8,440,275,004		100.00

THE SANTANDER SHARE. SEPTEMBER 2011

Shareholders and trading data
Shareholders (number)	3,263,997
Shares outstanding (number)	8,440,275,004
Average daily turnover (no. of shares)	107,920,147
Share liquidity (%)	247
(Number of shares traded during the year / number of shares)

Remuneration per share(1)	euros		%(1)
Santander Dividendo Elección (03.11.10)		0.119		(0.8	)
Santander Dividendo Elección (03.02.11)		0.117		(4.8	)
Fourth interim dividend 2010 (01.05.11)		0.229		3.1
First interim dividend 2011 (01.08.11)		0.135		0.0
Santander Dividendo Elección (03.11.11)		0.126		5.9

Price movements during the year
Beginning (30.12.10)	7.928
Highest	9.386
Lowest	5.152
Last (30.09.11)	6.224
Market capitalisation (millions) (30.09.11)	52,532
Stock market indicators
Price / Book value (2) (X)	0.70
P/E ratio (X)	7.81
Yield(3) (%)	7.86

(1)	Variation over its equivalent of previous year
(2)	Including the number of shares needed to compulsorily convert the “Valores Santander”.
(3)	Last three dividends paid + one announced / 9M’11 average share price

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 23

INFORMATION BY SEGMENTS

DESCRIPTION OF THE SEGMENTS

Grupo Santander maintained in 2011 the general criteria used in 2010, with the following exceptions:

•	The system for calculating the internal transfer rate (ITR) was changed. Until now Grupo Santander’s management model applied an ITR to each operation on the basis of its maturity and regardless of whether it was an operation for assets or liabilities. After three years of financial and liquidity crisis, the real cost of the liquidity of institutions has been shown to differ from the reference yield curve significantly and constantly.
	As a result, the Group decided to revise the system for measuring the spread by changing the ITR applied by the corporate centre to the units. The new ITR consists of the depo/swap curve (the same as the previous system) plus the “liquidity spread” relative to the period of “duration” of each operation. In other words, it reflects the average cost of Santander’s financing corresponding to the “duration” of each operation.
	This change makes the model more in line with the requirements of regulators, ensures a better pricing of operations and enables the market to better assess the profitability of businesses.
•	Change of perimeter in the UK. For the past few years, the Group has been developing a cards platform for the UK, which once operational was integrated into the juridical structure of this unit (with counterparty in the rest of Europe).
•	The annual adjustment was made to the Global Customer Relation Model and resulted in a net increase of 94 new clients. This does not mean any changes in the principal (geographic) segments, but it does affect the figures for Retail Banking and Global Wholesale Banking.

None of these changes was significant for the Group and do not alter its figures. The figures for 2010 were restated and include the changes in the affected areas.

The financial statements of each business segment are drawn up by aggregating the Group’s basic operating units. The information relates to both the accounting data of the companies in each area as well as that provided by the management information systems. In all cases, the same general principles as those used in the Group are applied.

In accordance with the IFRS, the business areas are structured into two levels:

Principal level (or geographic). The activity of the Group’s operating units is segmented by geographical areas. This coincides with the Group’s first level of management and reflects our positioning in the world’s three main currency areas (euro, dollar and sterling). The segments reported on are:

• Continental Europe. This covers all retail banking business (including Banif, the specialised private bank), wholesale banking and asset management and insurance conducted in Europe with the exception of the United Kingdom. Given the importance of some of these units, the financial information of the Santander Branch Network, Banesto, Santander Consumer Finance (including SCF USA) and Portugal are set out and from the second quarter Bank Zachodni WBK after its incorporation to the Group.

• United Kingdom. This includes retail and wholesale banking, asset management and insurance conducted by the various units and branches of the Group in the country.

• Latin America. This embraces all the Group’s financial activities conducted via its subsidiary banks and subsidiaries. It also includes the specialised units of Santander Private Banking, as an independent and globally managed unit, and New York’s business. Because of their specific importance, the financial statements of Brazil, Mexico and Chile are also provided.

In addition, Sovereign’s figures are recorded on their own.

Secondary level (or business). This segments the activity of the operating units by the type of business. The reported segments are:

• Retail Banking. This covers all customer banking businesses (except those of Corporate Banking, managed through the Global Customer Relationship Model). Because of their relative importance details are provided by the main geographic areas (Continental Europe, United Kingdom and Latin America) and Sovereign, as well as by the main countries. The results of the hedging positions in each country are also included, conducted within the sphere of each one’s Assets and Liabilities Committee.

• Global Wholesale Banking (GBM). This business reflects the revenues from global corporate banking, investment banking and markets worldwide including all treasuries managed globally, both trading and distribution to customers (always after the appropriate distribution with Retail Banking customers), as well as equities business.

• Asset Management and Insurance. This includes the contribution of the various units to the Group in the design and management of mutual and pension funds and insurance. The Group uses, and remunerates through agreements, the retail networks that place these products. This means that the result recorded in this business is net (i.e. deducting the distribution cost from gross income).

As well as these operating units, which cover everything by geographic area and by businesses, the Group continues to maintain the area of Corporate Activities. This area incorporates the centralised activities relating to equity stakes in industrial and financial companies, financial management of the structural exchange rate position and of the parent bank’s structural interest rate risk, as well as management of liquidity and of shareholders’ equity through issues and securitisations.

As the Group’s holding entity, this area manages all capital and reserves and allocations of capital and liquidity. It also incorporates amortisation of goodwill but not the costs related to the Group’s central services except for corporate and institutional expenses related to the Group’s functioning.

The figures of the various units of the Group listed below have been prepared in accordance with these criteria and therefore do not match those published by each institution individually.

24 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

INCOME STATEMENT
Million euros

	Net operating income												Attributable profit to the Group
	9M’11			9M’10			Amount			%			9M’11			9M’10			Amount			%
Continental Europe		6,703			6,871			(168	)		(2.4	)		2,441			2,739			(298	)		(10.9	)
o/w: Santander Branch Network		1,815			1,765			51			2.9			602			669			(68	)		(10.1	)
Banesto		876			1,064			(187	)		(17.6	)		189			413			(223	)		(54.1	)
Santander Consumer Finance		2,738			2,501			236			9.5			990			601			389			64.8
Portugal		355			518			(163	)		(31.4	)		129			368			(239	)		(64.9	)
Retail Poland (BZ WBK)		261						261						172						172
United Kingdom		2,437			2,873			(436	)		(15.2	)		757			1,529			(772	)		(50.5	)
Latin America		10,308			9,419			889			9.4			3,528			3,425			103			3.0
o/w: Brazil		7,579			6,615			965			14.6			1,973			2,063			(90	)		(4.4	)
Mexico		1,097			1,122			(25	)		(2.2	)		731			466			266			57.0
Chile		952			975			(23	)		(2.3	)		466			483			(17	)		(3.4	)
Sovereign		905			891			14			1.5			394			293			102			34.7
Operating areas		20,354			20,054			299			1.5			7,120			7,986			(866	)		(10.8	)
Corporate Activities		(1,824	)		(2,116	)		292			(13.8	)		(1,817	)		(1,906	)		89			(4.7	)
Total Group		18,529			17,938			591			3.3			5,303			6,080			(777	)		(12.8	)

RATIOS
%

	Efficiency ratio(1)				ROE				NPL ratio*				NPL coverage*
	9M’11		9M’10		9M’11		9M’10		9M’11		9M’10		9M’11		9M’10
Continental Europe		42.3		38.9		10.71		13.57		5.05		4.01		62		75
o/w: Santander Branch Network *		45.8		46.7		11.60		12.44		7.70		4.90		41		55
Banesto		46.4		42.0		5.39		12.37		4.69		3.83		53		60
Santander Consumer Finance		30.9		27.0		13.32		10.35		4.29		5.13		132		122
Portugal		52.6		43.6		6.97		21.35		3.78		2.43		53		69
Retail Poland (BZ WBK)		45.4				26.14				6.26				69
United Kingdom**		43.8		40.0		8.11		23.65		1.88		1.77		40		48
Latin America		38.9		38.4		21.54		21.53		4.10		4.15		102		103
o/w: Brazil		36.8		37.2		22.99		22.11		5.05		4.97		100		98
Mexico		39.8		37.8		21.56		18.94		1.78		2.20		176		199
Chile		38.9		35.6		24.81		28.59		3.63		3.58		88		94
Sovereign		43.7		43.9		13.24		13.89		3.22		4.80		93		72
Operating areas		40.9		39.1		13.83		17.88		3.84		3.39		69		77
Total Group**		44.3		42.9		9.47		11.75		3.86		3.42		66		75

(1),	- With amortisations.
(*).	- Santander Branch Network is the retail banking unit of Banco Santander S.A. The NPL ratio of Banco Santander S.A. at the end of September 2011 stood at 5.63% (3.79% in September 2010) and NPL coverage was 39% (61% in September 2010).
(**).	- Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, ROE UK: 14.75%; ROE Total Group: 10.57%.

OPERATING MEANS

	Employees				Branches
	9M’11		9M’10		9M’11		9M’10
Continental Europe		63,934		54,551		6,636		6,075
o/w: Santander Branch Network		18,747		18,809		2,915		2,931
Banesto		9,560		9,745		1,716		1,767
Santander Consumer Finance		15,452		13,947		662		523
Portugal		6,084		6,218		724		762
Retail Poland (BZ WBK)		9,563		—		527		—
United Kingdom		26,034		23,109		1,386		1,328
Latin America		90,106		87,765		5,964		5,784
o/w: Brazil		52,433		52,296		3,731		3,623
Mexico		12,997		12,435		1,099		1,093
Chile		12,300		11,629		494		500
Sovereign		8,950		8,539		723		720
Operating areas		189,024		173,964		14,709		13,907
Corporate Activities		2,326		2,507
Total Group		191,350		176,471		14,709		13,907

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 25

INFORMATION BY PRINCIPAL SEGMENTS

INCOME STATEMENT AND BALANCE SHEET OF PRINCIPAL SEGMENTS
Million euros

	Operating business areas									Continental Europe
	9M’11			9M’10			Var (%)			9M’11			9M’10			Var (%)
INCOME STATEMENT
Net interest income		24,530			23,265			5.4			7,947			7,508			5.8
Net fees		8,028			7,322			9.6			3,150			2,775			13.5
Gains (losses) on financial transactions		1,648			2,116			(22.1	)		212			677			(68.7	)
Other operating income (1)		218			221			(1.0	)		303			290			4.2
Gross income		34,424			32,923			4.6			11,611			11,251			3.2
Operating expenses		(14,070	)		(12,869	)		9.3			(4,908	)		(4,380	)		12.1
General administrative expenses		(12,586	)		(11,562	)		8.9			(4,448	)		(3,936	)		13.0
Personnel		(7,447	)		(6,702	)		11.1			(2,778	)		(2,496	)		11.3
Other general administrative expenses		(5,139	)		(4,859	)		5.8			(1,669	)		(1,440	)		15.9
Depreciation and amortisation		(1,484	)		(1,307	)		13.5			(460	)		(444	)		3.6
Net operating income		20,354			20,054			1.5			6,703			6,871			(2.4	)
Net loan-loss provisions		(7,817	)		(7,767	)		0.6			(2,868	)		(3,022	)		(5.1	)
Other income		(2,123	)		(786	)		170.0			(379	)		(68	)		459.8
Profit before taxes		10,413			11,501			(9.5	)		3,455			3,781			(8.6	)
Tax on profit		(2,641	)		(2,789	)		(5.3	)		(912	)		(958	)		(4.9	)
Profit from continuing operations		7,772			8,712			(10.8	)		2,544			2,823			(9.9	)
Net profit from discontinued operations		(3	)		(7	)		(57.0	)		(3	)		(7	)		(57.0	)
Consolidated profit		7,770			8,705			(10.7	)		2,541			2,817			(9.8	)
Minority interests		650			719			(9.7	)		100			78			28.3
Attributable profit to the Group		7,120			7,986			(10.8	)		2,441			2,739			(10.9	)
BALANCE SHEET
Customer loans (2)		731,808			713,972			2.5			327,444			326,804			0.2
Trading portfolio (w/o loans)		163,840			154,936			5.7			77,735			68,228			13.9
Available-for-sale financial assets		59,604			62,128			(4.1	)		21,454			25,064			(14.4	)
Due from credit institutions (2)		113,823			166,204			(31.5	)		51,957			104,641			(50.3	)
Intangible assets and property and equipment		12,383			11,272			9.9			5,148			4,958			3.8
Other assets		125,876			119,012			5.8			22,687			20,788			9.1
Total assets/liabilities & shareholders’ equity		1,207,333			1,227,524			(1.6	)		506,424			550,483			(8.0	)
Customer deposits (2)		607,930			586,798			3.6			255,020			247,464			3.1
Marketable debt securities (2)		136,307			134,039			1.7			42,425			49,405			(14.1	)
Subordinated debt (2)		16,875			18,422			(8.4	)		985			2,009			(51.0	)
Insurance liabilities		9,894			6,527			51.6			930			3,585			(74.1	)
Due to credit institutions (2)		180,994			205,613			(12.0	)		77,801			103,137			(24.6	)
Other liabilities		187,534			211,801			(11.5	)		98,425			118,005			(16.6	)
Shareholders’ equity (3)		67,798			64,324			5.4			30,838			26,878			14.7
Other customer funds under management		133,150			142,179			(6.4	)		47,548			60,583			(21.5	)
Mutual funds		103,755			107,833			(3.8	)		32,377			41,753			(22.5	)
Pension funds		9,893			10,865			(8.9	)		9,893			10,865			(8.9	)
Managed portfolios		18,796			20,726			(9.3	)		5,278			5,434			(2.9	)
Savings-insurance policies		707			2,755			(74.4	)		—			2,532			(100.0	)
Customer funds under management		894,262			881,438			1.5			345,978			359,462			(3.8	)

(1).	- Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

26 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

INCOME STATEMENT AND BALANCE SHEET OF PRINCIPAL SEGMENTS
Million euros

United Kingdom*									Latin America
9M’11			9M’10			Var (%)			9M’11			9M’10			Var (%)
																		INCOME STATEMENT
	3,144			3,601			(12.7	)		12,179			10,836			12.4		Net interest income
	803			791			1.6			3,786			3,444			9.9		Net fees
	374			380			(1.6	)		959			1,053			(8.9	)	Gains (losses) on financial transactions
	17			19			(6.8	)		(57	)		(38	)		51.9		Other operating income (1)
	4,339			4,790			(9.4	)		16,866			15,294			10.3		Gross income
	(1,901	)		(1,917	)		(0.8	)		(6,558	)		(5,875	)		11.6		Operating expenses
	(1,633	)		(1,687	)		(3.2	)		(5,885	)		(5,320	)		10.6		General administrative expenses
	(1,021	)		(978	)		4.4			(3,298	)		(2,879	)		14.5		Personnel
	(612	)		(709	)		(13.7	)		(2,587	)		(2,441	)		6.0		Other general administrative expenses
	(268	)		(230	)		16.4			(673	)		(555	)		21.4		Depreciation and amortisation
	2,437			2,873			(15.2	)		10,308			9,419			9.4		Net operating income
	(432	)		(751	)		(42.5	)		(4,260	)		(3,542	)		20.3		Net loan-loss provisions
	(955	)		(17	)		—			(716	)		(685	)		4.7		Other income
	1,051			2,105			(50.1	)		5,332			5,193			2.7		Profit before taxes
	(294	)		(576	)		(48.9	)		(1,254	)		(1,127	)		11.3		Tax on profit
	757			1,529			(50.5	)		4,077			4,066			0.3		Profit from continuing operations
	—			—			—			—			—			—		Net profit from discontinued operations
	757			1,529			(50.5	)		4,077			4,066			0.3		Consolidated profit
	0			0			(93.1	)		549			641			(14.3	)	Minority interests
	757			1,529			(50.5	)		3,528			3,425			3.0		Attributable profit to the Group

Pro memoria:

Million sterling					Million dollars
	3,780	4,102	(7.9	)		23,706	20,055	18.2	Gross income
	2,123	2,460	(13.7	)		14,489	12,352	17.3	Net operating income
	659	1,310	(49.7	)		4,959	4,492	10.4	Attributable profit to the Group

(*) Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, 2011 profit was EUR 1,377 million (sterling 1,198 million)

								BALANCE SHEET
235,140	233,694	0.6		131,288	117,909	11.3		Customer loans (2)
49,693	51,969	(4.4	)	36,144	34,487	4.8		Trading portfolio (w/o loans)
1,108	942	17.7		26,604	27,263	(2.4	)	Available-for-sale financial assets
36,776	37,912	(3.0	)	24,282	23,121	5.0		Due from credit institutions (2)
2,237	1,457	53.5		4,443	4,393	1.1		Intangible assets and property and equipment
43,549	42,281	3.0		55,828	50,868	9.8		Other assets
368,502	368,255	0.1		278,590	258,041	8.0		Total assets/liabilities & shareholders’ equity
187,141	180,490	3.7		130,628	128,554	1.6		Customer deposits (2)
70,042	70,657	(0.9	)	22,224	12,143	83.0		Marketable debt securities (2)
7,939	8,364	(5.1	)	5,658	5,357	5.6		Subordinated debt (2)
—	1	(100.0	)	8,965	2,942	204.7		Insurance liabilities
50,793	54,402	(6.6	)	44,206	37,384	18.3		Due to credit institutions (2)
39,947	41,453	(3.6	)	46,931	50,053	(6.2	)	Other liabilities
12,640	12,889	(1.9	)	19,978	21,609	(7.5	)	Shareholders’ equity (3)
14,686	13,704	7.2		70,913	67,839	4.5		Other customer funds under management
14,686	13,704	7.2		56,691	52,377	8.2		Mutual funds
—	—	—		—	—	—		Pension funds
—	—	—		13,515	15,239	(11.3	)	Managed portfolios
—	—	—		707	223	217.4		Savings-insurance policies
279,808	273,214	2.4		229,422	213,892	7.3		Customer funds under management

(1).	- Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 27

INFORMATION BY PRINCIPAL SEGMENTS

CONTINENTAL EUROPE. MAIN UNITS
Million euros

	Santander Branch Network									Banesto
	9M’11			9M’10			Var (%)			9M’11			9M’10			Var (%)
INCOME STATEMENT
Net interest income		2,457			2,419			1.6			1,030			1,206			(14.6	)
Net fees		845			827			2.2			462			463			(0.1	)
Gains (losses) on financial transactions		79			90			(12.2	)		103			116			(11.3	)
Other operating income (1)		(31	)		(24	)		27.3			39			50			(22.9	)
Gross income		3,351			3,312			1.2			1,634			1,835			(10.9	)
Operating expenses		(1,536	)		(1,547	)		(0.7	)		(758	)		(771	)		(1.7	)
General administrative expenses		(1,421	)		(1,428	)		(0.5	)		(664	)		(678	)		(2.1	)
Personnel		(929	)		(924	)		0.6			(486	)		(505	)		(3.7	)
Other general administrative expenses		(492	)		(504	)		(2.5	)		(177	)		(173	)		2.4
Depreciation and amortisation		(115	)		(119	)		(3.5	)		(94	)		(93	)		1.3
Net operating income		1,815			1,765			2.9			876			1,064			(17.6	)
Net loan-loss provisions		(970	)		(868	)		11.7			(461	)		(459	)		0.5
Other income		(20	)		20			—			(136	)		14			—
Profit before taxes		825			917			(10.1	)		279			619			(55.0	)
Tax on profit		(223	)		(248	)		(10.1	)		(61	)		(154	)		(60.1	)
Profit from continuing operations		602			669			(10.1	)		217			465			(53.3	)
Net profit from discontinued operations		—			—			—			—			—			—
Consolidated profit		602			669			(10.1	)		217			465			(53.3	)
Minority interests		0			0			52.7			28			53			(46.8	)
Attributable profit to the Group		602			669			(10.1	)		189			413			(54.1	)
BALANCE SHEET
Customer loans (2)		104,671			112,812			(7.2	)		69,245			74,393			(6.9	)
Trading portfolio (w/o loans)		—			—			—			7,699			7,644			0.7
Available-for-sale financial assets		—			—			—			7,206			9,827			(26.7	)
Due from credit institutions (2)		137			217			(36.9	)		10,286			25,928			(60.3	)
Intangible assets and property and equipment		1,201			1,211			(0.9	)		1,356			1,387			(2.3	)
Other assets		1,785			476			275.2			5,989			6,633			(9.7	)
Total assets/liabilities & shareholders’ equity		107,794			114,716			(6.0	)		101,780			125,812			(19.1	)
Customer deposits (2)		81,063			87,224			(7.1	)		51,385			58,685			(12.4	)
Marketable debt securities (2)		—			—			—			24,608			28,256			(12.9	)
Subordinated debt (2)		—			—			—			790			1,325			(40.4	)
Insurance liabilities		—			—			—			—			—			—
Due to credit institutions (2)		524			808			(35.2	)		9,319			20,346			(54.2	)
Other liabilities		19,526			19,649			(0.6	)		10,969			12,715			(13.7	)
Shareholders’ equity (3)		6,681			7,035			(5.0	)		4,709			4,484			5.0
Other customer funds under management		23,883			27,678			(13.7	)		8,687			10,026			(13.4	)
Mutual funds		16,712			20,980			(20.3	)		4,688			6,164			(24.0	)
Pension funds		5,628			6,125			(8.1	)		1,229			1,338			(8.1	)
Managed portfolios		—			—			—			114			104			10.1
Savings-insurance policies		1,543			574			168.7			2,656			2,421			9.7
Customer funds under management		104,946			114,902			(8.7	)		85,470			98,292			(13.0	)

(1).	- Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

28 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

CONTINENTAL EUROPE. MAIN UNITS
Million euros

																		Retail Poland
Santander Consumer Finance									Portugal									(BZ WBK)
9M’11			9M’10			Var (%)			9M’11			9M’10			Var (%)			9M’11
																					INCOME STATEMENT
	3,088			2,699			14.4			456			551			(17.2	)		245		Net interest income
	878			701			25.2			270			275			(1.9	)		171		Net fees
	(5	)		5			—			6			58			(89.0	)		46		Gains (losses) on financial transactions
	1			19			(95.5	)		16			35			(53.1	)		16		Other operating income (1)
	3,961			3,425			15.6			749			919			(18.5	)		477		Gross income
	(1,224	)		(924	)		32.4			(394	)		(401	)		(1.8	)		(217	)	Operating expenses
	(1,125	)		(840	)		33.9			(342	)		(347	)		(1.5	)		(199	)	General administrative expenses
	(580	)		(431	)		34.5			(237	)		(239	)		(0.9	)		(119	)	Personnel
	(545	)		(409	)		33.3			(105	)		(108	)		(2.8	)		(80	)	Other general administrative expenses
	(98	)		(83	)		17.4			(52	)		(53	)		(3.5	)		(18	)	Depreciation and amortisation
	2,738			2,501			9.5			355			518			(31.4	)		261		Net operating income
	(1,174	)		(1,521	)		(22.8	)		(122	)		(103	)		18.3			(39	)	Net loan-loss provisions
	(98	)		(104	)		(5.1	)		(68	)		28			—			(2	)	Other income
	1,465			877			67.1			165			443			(62.7	)		220		Profit before taxes
	(411	)		(245	)		67.4			(36	)		(75	)		(51.8	)		(42	)	Tax on profit
	1,054			631			67.0			129			368			(64.9	)		178		Profit from continuing operations
	(3	)		(7	)		(57.0	)		—			—			—			—		Net profit from discontinued operations
	1,051			625			68.3			129			368			(64.9	)		178		Consolidated profit
	61			24			155.5			(0	)		0			—			6		Minority interests
	990			601			64.8			129			368			(64.9	)		172		Attributable profit to the Group
																					BALANCE SHEET
	70,246			63,624			10.4			28,945			33,342			(13.2	)		8,219		Customer loans (2)
	1,483			1,570			(5.5	)		1,575			1,787			(11.9	)		985		Trading portfolio (w/o loans)
	387			762			(49.2	)		4,172			6,786			(38.5	)		2,639		Available-for-sale financial assets
	7,968			7,324			8.8			2,164			4,702			(54.0	)		410		Due from credit institutions (2)
	823			871			(5.6	)		460			479			(3.9	)		261		Intangible assets and property and equipment
	3,858			3,069			25.7			6,569			4,514			45.5			978		Other assets
	84,765			77,221			9.8			43,884			51,610			(15.0	)		13,491		Total assets/liabilities & shareholders’ equity
	34,181			25,460			34.3			22,812			19,818			15.1			9,936		Customer deposits (2)
	11,324			11,103			2.0			5,170			8,545			(39.5	)		—		Marketable debt securities (2)
	65			423			(84.6	)		22			254			(91.3	)		100		Subordinated debt (2)
	—			—			—			75			1,494			(95.0	)		—		Insurance liabilities
	23,825			27,737			(14.1	)		13,079			18,490			(29.3	)		1,617		Due to credit institutions (2)
	5,364			4,483			19.7			183			883			(79.3	)		614		Other liabilities
	10,006			8,015			24.8			2,543			2,126			19.6			1,224		Shareholders’ equity (3)
	6			24			(73.4	)		3,213			6,348			(49.4	)		2,091		Other customer funds under management
	2			19			(87.9	)		2,159			3,496			(38.2	)		1,888		Mutual funds
	4			5			(16.5	)		983			1,314			(25.2	)		—		Pension funds
	—			—			—			72			130			(45.0	)		203		Managed portfolios
	—			—			—			—			1,408			(100.0	)		—		Savings-insurance policies
	45,576			37,010			23.1			31,218			34,965			(10.7	)		12,127		Customer funds under management

(1).	- Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 29

INFORMATION BY PRINCIPAL SEGMENTS

CONTINENTAL EUROPE

• Basic revenue increased 7.7% year-on-year due to the improvement in net interest income and fee income in the commercial units and consolidation of Bank Zachodni WBK.

• Controlled expenses: commercial units flat on a like-for-like basis (+0.6%).

• Attributable profit hit by lower gains on financial transactions and reduced release of generic provisions.

• Growth strategy: preference for liquidity against a background of low demand for loans.

Continental Europe includes all activities carried out in this geographic area: retail banking, global wholesale banking, asset management and insurance.

Attributable profit was EUR 2,441 million, 10.9% lower than in the first nine months of 2010.

The results reflect the perimeter effect of incorporating Bank Zachodni WBK, AIG’s consumer business in Poland and SEB’s branches in Germany. Overall, the positive impact was around 7 percentage points throughout the income statement. Attributable profit was 18.0% lower on a like-for-like basis.

Strategy

In a still weak environment and with low interest rates, the Group’s strategy continued to focus on the priorities outlined in previous periods and aimed at:

• defending spreads on loans (those on new ones are improving) and on deposits, which reflect a lower cost in recent months thanks to the strategy followed in the renewal of balances captured in last year’s campaign, where priority was given to improved costs over volumes;

• control of expenses

• and risk management very centred on recoveries.

Preference was given in volumes to liquidity and deposits in a context of low demand for loans.

Activity

Lending remained virtually flat year-on-year, as the lower demand in Spain and Portugal was offset by business growth at Santander Consumer Finance and the incorporation of Bank Zachodni WBK.

Deposits rose 3% year-on-year, due to the incorporation of new institutions and Portugal’s evolution, offsetting lower balances in Spain, affected by the strategy followed in the process of renewing maturities of deposits captured in the 2010 campaign.

Growth in mutual funds and pension funds was affected by the strategy of greater preference for deposits

Results

Basic revenues grew 7.7% year-on-year driven by Santander Consumer Finance (partially favoured by the incorporations), the entry of BZ WBK and the recovery in net interest income at the Santander Branch Network and Banesto in the last few quarters.

Net interest income rose 5.8% and fee income 13.5%. Deducting the perimeter impact, net interest income remains flat and fee income increased 4.3%.

Operating expenses increased 12.1% year-on-year, due to the perimeter effect as on a like-for-like basis they only rose 1.5%. The Santander Branch Network, Banesto and Portugal reduced their costs.

Provisions for loan losses were 5.1% lower (-7.5% deducting the perimeter impact). This was due to various factors:

• On the one hand, it reflected the effort being made in risk management and which led to lower specific provisions, favoured by the charge made in 2010 from applying Circular 3/2010 of the Bank of Spain.

• On the other, the ending of the regulating effect from the release of generic provisions in the commercial units in Spain. Releases amounted to EUR 419 million, down from EUR 1,395 million in the first nine months of 2010.

Attributable profit was EUR 2,441 million.

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INFORMATION BY PRINCIPAL SEGMENTS

SANTANDER BRANCH NETWORK

• Improved underlying results.

• Further rise in gross income (+1.2%), above those of 2010 for the first time this year.

• Operating expenses declined 0.7%.

• Specific provisions were 32.1% lower.

• Attributable profit affected by fewer releases of generic provisions.

• Activity reflected the scant demand for loans and a strategy in deposits which combines cost reduction and volume retention.

The Santander Network posted an attributable profit of EUR 602 million, 10.1% less than in the first nine months of 2010. This was mainly due to the smaller release of generic provisions, as net operating income after provisions, unlike the previous quarters when it declined, rose 2.9%, underscored by the better trend of gross income in recent quarters over last year’s and by the control of expenses.

These results were obtained in a still difficult environment, without sufficient signs of an economic recovery and a very competitive financial sector.

Strategy

The Santander Branch Network maintained its basic management principles: management of prices, strengthening the balance sheet, with particular emphasis on capturing funds, control and early management of NPLs, and austerity in costs. At the same time we continue to take advantage of opportunities to keep on capturing funds and boost customer linkage.

Activity

The process of managing the maturity of deposits captured in the 2010 campaign, when priority was given to reducing their cost (-0.50 p.p. in time deposits), was completed in July. This policy was combined with a high retention level, which resulted in an increase of EUR 8,600 million (+12%) since the start of the campaign.

In the third quarter, after this process was over, deposits began to grow again and amounted to EUR 1,026 million (+1% over June).

Lending in a weak market declined 7% year-on-year. In this context, the Santander Branch Network continued to lead lending via facilities lines, among which were those sponsored by ICO. More than 40,000 of these loans have been made so far this year for a total amount of EUR 2,800 million (market share of 21%).

These loans, together with the rest of those granted in the first nine months, brought the total number of operations to 170,000 (EUR 18,000 million).

At September 30, 340,000 customers had been captured, 5% more than in the first nine months of 2010 after discounting the impact of the campaign to capture funds. Around 40% of them are linked to the “We want to be your Bank” plan as they have benefited from the “Zero service commissions” programme.

Results

Gross income was EUR 3,351 million, 1.2% more in the year-to-year reversing the trend of the last two years of lower revenues. Growth was due to net interest income as the strategy to improve spreads, particularly on deposits, enabled the customer spreads (the yield on lending less the cost of funds) to increase by almost one p.p. (from 1.43% in September 2010 to 2.31%) and fee income (+2.2%), mainly those from insurance activity.

Operating expenses continued the downward trend of the last years, which is particularly significant given that inflation is around 3% and the branch network’s commercial capacity has remained virtually unchanged, with no significant closures, unlike the general trend. The efficiency ratio improved 1 p.p. to 45.8% at the end of September (42% excluding amortisations) and net operating income rose 2.9% to EUR 1,815 million.

Credit risk and NPL management continued to be given maximum priority. The NPL ratio was 7.70% in the commercial network at the end of September (excluding wholesale activities) and 5.63% at the parent bank, comparable with the rest of institutions which are banks and well below the average of them. Coverage ratios were 41% for the network and 39% for the parent bank.

Net provisions were EUR 970 million, 11.7% more than in the first nine months of 2010 due to the net between the lower release of generic provisions and reduced specific provisions, party due to the management carried out and partly to the impact of the one-off charge in 2010 from applying Bank of Spain’s Circular 3/2010.

Net operating income after provisions was EUR 845 million, 5.7% less year-on-year.

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 31

INFORMATION BY PRINCIPAL SEGMENTS

BANESTO

• Basic revenues virtually flat in the quarter.

• Operating expenses down 1.7%.

• Stable specific provisions in the three quarters of 2011, and much lower than those in 2010.

• Profit hit by lower release of generic provisions.

• NPL ratios still better than the sector’s.

• Credit growth reflected the lower demand and in deposits focus on the return.

Banesto generated an attributable profit of EUR 189 million in the first nine months, 54.1% lower than in the same period of 2010.

Strategy

The third quarter was a complicated one for banks, because as well as the still weak economic growth there were other uncertainties that produced tensions and volatility in the markets. In this context, the priorities were to capture and link customers, make provisions to strengthen Banesto’s financial position and control expenses.

Activity

The bank’s liquidity situation and its large number of customers facilitated profitable and efficient management of funds. In the year, there was a greater focus in return over volumes, thus resulting, at the end of September, in lower customer deposits excluding repos, 14% less than a year earlier, but in line with those at the end of 2009.

The lower demand for loans reduced the scope for lending. The volume of loans at the end of September was 7% lower than a year earlier at EUR 69,245 million.

The weak environment pushed up the NPL ratio to 4.69%, although this increase was mainly due to the lower volume of total loans as in the first nine months NPLs increased by only EUR 165 million. Coverage at the end of September was 53%.

Results

Net interest income was EUR 1,030 million, 14.6% less than in the first nine months of 2010. The reduction was due to the impact of lower activity on business and the rise in financing costs which, however, was limited by management of prices and of the balance sheet.

Net fee income was EUR 462 million, the same as in the first nine months of 2010. Income from services increased 2.5% year-on-year, thanks to customer management and linkage which produced a rise in transactional business and use of value-added services. Income from mutual and pension funds was 14.7% lower year-on-year, due to the drop in average fee income and customer preference for other types of savings.

The tensions in markets impacted gains on financial transactions, both because of the reduced levels of customer activity as well as the high volatility of markets in recent months. Gains were 11.3% lower year-on-year at EUR 103 million.

Gross income was EUR 1,634 million, 10.9% less than in the first nine months of 2010.

The environment demands strict control of efficiency. Operating expenses were EUR 758 million, 1.7% less year-on-year. The efficiency ratio was 46.4%.

Net operating income declined 17.6% year-on-year to EUR 876 million.

Total provisions and write-downs were EUR 597 million, with net loan-loss provisions at EUR 461 million (EUR 459 million at September 2010). This was due to the net between lower specific provisions (EUR 574 million vs. EUR 908 million in 2010, including the EUR 178 million impact of the change in the Bank of Spain’s regulation) and lower use of generic provisions this year (EUR 337 million).

Furthermore, Banesto made additional provisions of EUR 136 million this year to strengthen its financial position. Of this amount, EUR 28 million were for provisions for early retirements made in the first half of the year and the rest for coverage of loan loss provisions and foreclosed properties.

Profit before tax was EUR 279 million. Attributable profit after taxes and minority interests was EUR 189 million.

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INFORMATION BY PRINCIPAL SEGMENTS

SANTANDER CONSUMER FINANCE

• Profit surged 64.8%, thanks to 15.6% growth in gross income and a 22.8% fall in provisions.

• The rise in results was backed by all areas.

• Larger volumes, concentrated in Germany and Nordic countries, and strict management of prices in order to offset the higher cost of funding.

• Further improvement in liquidity and credit quality (lower NPLs and coverage at maximums).

SCF’s attributable profit in the first nine months was EUR 990 million, 64.8% more than in the same period of 2010.

Strategy

The SCF business model is based on portfolio diversification, leadership in core markets, efficiency, control of risks and recoveries and a single pan-European platform.

In Europe, the focus was on organic growth and cross-selling, backed by brand agreements, greater penetration in the used car segment and a rise in new car sales in Central European and Nordic countries. In Germany, Santander Retail (formerly SEB) took its first steps, concentrating on mortgages and capturing customer funds.

In the US, sharp rise in new loans from low levels combined with the contribution from the portfolios incorporated. In the fourth quarter, agreement for the entry of new partners in SC USA (US$1,150 million of new capital) to strengthen business and increase the capacity for future growth.

Activity

Gross lending amounted to EUR 74,475 million, 10% more year-on-year because of organic growth and the integration of businesses in Germany, which offset the accelerated amortisation of portfolios in the US.

New lending amounted to EUR 20,766 million in the first nine months (+12% y-o-y), spurred by auto finance for used cars (+14%) and direct lending, particularly in Germany (+22%). Weaker activity in durable goods (-0.2%) and new cars (+4%), though somewhat better than car sales in Europe (-1%).

In local currency terms, lending rose in Germany (+16%), the Nordic countries (+9%), the US (+55%), Spain (+9%) and Poland (+42% backed by AIG). On the other hand, declines in Italy (-10%) and the UK (-4%), although better than the average of these markets.

Customer deposits increased 34% to EUR 34,183 million, fuelled by SC Germany and the entry of Santander Retail. This unit took advantage of its “welcome” campaigns to grow in balances and customers (+EUR 1,500 million and +30,000 accounts in six months). As regards wholesale funds, SCF placed new securitisations in the third quarter (more than EUR 3,000 million in the first nine months).

All of this enhanced SCF’s liquidity position (customer deposits and medium- and long-term funding cover 68% of loans, +10 p.p. in a year) and continued to reduce recourse to the parent bank.

Results

Gross income increased 15.6% y-o-y, backed by the most basic revenues: net interest income (+14.4%), due to the rise in the average portfolio and better spreads, fee income (+25.2%), basically due to servicing in the US, and greater penetration of key European countries (Germany, Poland and Norway).

Higher expenses (+32.4% y-o-y) due to the new incorporations. The new units left the efficiency ratio at 30.9% with clear opportunities for improvement (Santander Retail’s ratio was 89% at the end of September).

Sharp fall in loan-loss provisions (-22.8% y-o-y), causing net operating income after provisions to increase 59.5%. The lower provisions reflect the improvement in the quality of the portfolio: NPL ratio of 4.29% (September 2010: 5.13%) and high coverage (132%), after absorbing the impact of the new incorporations.

These trends in revenues, costs and provisions produced the 64.8% jump in attributable profit.

The trends were similar in individual countries, with rises in all areas. Santander Consumer USA doubled its contribution (+121% in dollars), due to its three basic drivers: larger average volumes (organic generation and incorporation of portfolios), higher revenues from servicing and the lower cost of credit. Germany’s profits grew 18.6%, driven by growth new in lending and the risk improvement.

The performance was very positive in the rest of the units, particularly the Nordic countries (attributable profit: +15.6% year-on-year in local currency), the UK (+26.3% in sterling) and in Spain, which returned to profit thanks to lower provisions. Lastly, the unit in Poland more than doubled its profit because of the incorporation of AIG.

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INFORMATION BY PRINCIPAL SEGMENTS

PORTUGAL

• The difficult economic environment led the country to seek and receive financial aid from the EU and implement adjustment measures.

• Revenues dropped 18.5% because of the strong competition for liquidity and the situation in the markets.

• Lower expenses (-1.8%) and higher provisions (+18.3%) reflect very prudent management in an unfavourable environment.

• Further fall in lending and rise in deposits. The deleveraging target set for the whole of 2011 has already been reached.

Santander Totta’s attributable profit was EUR 129 million, 64.9% lower year-on-year.

Environment

Economic conditions worsened in the second quarter, especially domestic demand, which fell 5.2% year-on-year. Private consumption declined 3.4% in the second quarter and although the unemployment rate (12.1%) improved a little households expect it to rise.

External demand remained dynamic and exports grew.

This evolution reflects the adjustments made and the adoption of further measures by the government to meet the budget deficit target of 5.9% of GDP this year. The International Monetary Fund, in its assessment of the austerity programme, said “the programme is proceeding as expected and all the criteria for the end of June and July were met.”

Under the rescue plan agreed with international institutions, Portuguese banks will have to implement various restructuring measures, mainly regarding reducing the level of the banking system’s leverage; cutting exposure to the European Central Bank and boosting the core capital ratios (to 9% at the end of 2011 and 10% at the end of 2012). The financial system is already adjusting (moderate reduction in lending and increase in deposits).

Activity

In this environment, Santander Totta pursued its deleveraging policy. Deposits amounted to EUR 22,812 million, 15% more than in September 2010. Lending, on the other hand, dropped 13% to EUR 28,945 million (individuals; 2%, SMEs; 6%, and the rest of firms; above 20%).

The evolution of deposits and lending improved the structure of the balance sheet and reduced the commercial gap by EUR 2,200 million over the end of 2010 (goal of EUR 2,000 million for the whole year).

Mutual funds declined 38%, reflecting the greater aversion to risk.

Results

Attributable profit was EUR 129 million, 64.9% lower year-on-year, due to the 18.5% drop in gross income and an 18.3% rise in loan-loss provisions. Operating expenses declined 1.8%.

Net interest income of EUR 456 million was 17.2% lower than in the first nine months of 2010, due to the reduction in lending (but with higher spreads) and the higher cost of wholesale and retail funding due to greater competition to capture deposits.

Net fee income dropped 1.9% to EUR 270 million, reflecting the reduction in lending, funds and financial insurance, which was partly offset by fee income from GBM.

Gains on financial transactions amounted to EUR 6 million 89% lower than the first nine months of 2010 when gains were much higher because of the different market context.

As a result, gross income was EUR 749 million, 18.5% less than in the same period of 2010, while operating expenses declined 1.8%. The efficiency ratio was 52.6% and net operating income at EUR 355 million was 31.4% lower.

Loan-loss provisions, other income and allowances amounted to EUR 190 million, double that in the first nine months of 2010 and reflecting the difficulties of the economic cycle. The NPL ratio in September was 3.78% and coverage 53% (using Spain’s criteria).

Profit before tax was EUR 165 million, down 62.7% and attributable profit EUR 129 million.

34 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

RETAIL BANKING POLAND (BZ WBK)

• Consolidated as of April 1, 2011.

• Attributable profit of EUR 172 million in the two quarters (equivalent to 4% of the operating areas’ total in the same period).

• Solid funding structure: loan-to-deposits ratio of 83%.

• High growth potential due to the favourable macroeconomic environment, solid presence in the market, management capacity and generation of synergies.

Description of the bank and its environment

Banco Santander completed its acquisition of 95.67% of BZ WBK on April 1 after launching its takeover bid in the first quarter for full control, together with the 50% stake of BZ WBK Asset Management still in the hands of AIB. Group BZ WBK is now integrated into Grupo Santander, consolidating its second quarter results and business.

BZ WBK enables Grupo Santander to develop its activity in Poland, a country with considerable potential: 38.5 million citizens and a GDP which is more than 40% of that of the other new EU members. Its economy is stable (the only EU country not to have suffered a recession in the last decade), growing (+4% forecast for 2011) and needing to complete its infrastructure and with a low level of “bankarisation” (lending represents around 50% of GDP). All of these factors make the outlook good for banking business.

BZ WBK has the third largest branch network in Poland (619 including 92 agencies), 9,563 employees, 2.5 million retail customers and over EUR 20,000 million of loan and customer funds (mostly deposits).

Its business model is commercial banking, focusing on retail and company clients (SMEs and corporations), and it has a notable presence in asset management, intermediation of securities and leasing. All of this fits well with the retail business model of Santander and provides a significant growth potential in results in the next few years, both via business as well as from synergies.

BS WBK conducted its business in an economy growing at 4.3% in the second quarter, fuelled by domestic demand (more consumption and pick up in investment). This stronger activity is reflected in banking business that is growing at close to 10% in 2011.

Inflation is close to 4.1% and made the central bank raise its interest rates to 4.5% (+100 b.p. since the end of 2010). The zloty remained stable against the euro until August when market uncertainty caused it to slide (PLN 4.20/euro).

Integration of BZ WBK in Grupo Santander

In the first six months under Santander management, and in cooperation with the local management team, the first steps were taken to ensure the improvements in operating and commercial efficiency announced to the market.

Of note were:

• In the technology and operations area, measures to control costs were put into effect, as well as the global integrator of Group purchases, with short-term objectives.

• The first steps were taken in the risk and financial areas to adjust the organisation, processes and IT systems in order to ensure control and standardisation. Of note was the progress made in installing the corporate risk model, now operating for large companies.

• Global business units were launched which combine local knowledge and the Group’s experience. Tangible progress was made in Global Banking and Markets with the customer base of the global relationship model in the country.

• The best practices in commercial banking were analysed and identified based on the long experience of both institutions.

Balance sheet and results

BZ WBK registered as of September EUR 8,219 million of net loans and EUR 9,936 million of deposits (1.1% and 1.6% of the Group’s lending and deposits, respectively).

In the first six months under Santander management, loans increased 10% (+5% in the quarter) and deposits 6% (increases both in companies and individual customers).

Attributable profit (six months) was EUR 172 million, backed by solid gross income of EUR 477 million. Of this amount, EUR 245 million came from net interest income (+3.2% in the quarter in local currency), which improved its return on assets over 2010, and EUR 171 million from fee income, due to the importance of asset management business and brokerage of securities.

Loan-loss provisions absorbed only 15% of net operating income. In line with the macroeconomic situation, credit quality improved, the NPL ratio dropped and coverage rose.

In local criteria, these results compared very well with the first nine months of 2010, as basic revenues increased 10% and attributable profit 40%.

OTHER BUSINESS

The rest of businesses (GBM, asset management, insurance and Banif) generated attributable profit of EUR 358 million, 48.0% lower than in the first nine months of 2010.

The reason for the fall was that Global Wholesale Banking, the main unit included here, accounts for 83% of profits. Its attributable profit was 53.1% lower because of reduced gains on financial transactions, as in 2010 they were high at EUR 399 million (EUR 38 million loss in 2011, hard hit by the market situation). Net interest income and fee income performed better and increased 3.8%.

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INFORMATION BY PRINCIPAL SEGMENTS

UNITED KINGDOM

• Attributable profit of £659 million, impacted by a the provision of £538 million in June for payment protection insurance remediation (PPI). Excluding this provision profit was £1,198 million.

• Better financial position: In 2011, £3,000 million from disposal of non-core assets and £23,200 million from medium-term issues offset the pressure from the strong competition in capturing customer deposits.

• Better than expected evolution of non-performing loans, particularly in mortgages and UPLs.

Santander UK posted an attributable profit of £659 million in the first nine months of 2011. This included the impact net of tax of a provision of £538 million in the second quarter, related to payment protection insurance (PPI) remediation, in line with what has been done by other British banks.

Excluding this charge, profit was £1,198 million, 8.6% less than in the first nine months of 2010. The reduction was due to higher costs derived from regulatory changes (negative impact of £253 million net of taxes compared to the first nine months of 2010).

Environment

GDP growth slowed in the second quarter (to +0.7% quarter-on-quarter annualised), affected by certain negative factors such as the impact of Japan’s tsunami on industrial output. With inflation at 5.2% in September, household income is being eroded.

Despite the rise in inflation and due to the continued uncertainty over an economic recovery, the Bank of England held its base rate at the historic low of 0.5% and expanded the quantitative easing programme.

Strategy

Santander UK’s business includes Abbey since 2004, the deposits and branches of Bradford & Bingley since September 2008 and Alliance & Leicester since October 2008. We refer to these businesses as Santander UK.

Thanks to the combination of the three businesses, Santander UK has attained market shares of more than 10% in core segments such as mortgages and deposits. It continues to increase the range of retail banking products and services, while growth in loans to SMEs remains one of its priorities. All of this is accelerating the objective of converting Santander UK into a commercial bank offering all services and products.

The strategy consists of becoming much more customer-focused, diversifying the business mix and making Santander UK the bank of choice for SMEs. In order to support each of these goals, we remain focused on efficiency, service and a desire to be the best company to work for.

Activity

Santander UK’s balance sheet primarily consists of residential mortgages, with no exposure to self-certified mortgages or subprime and less than 1% of buy-to-let loans. The loan-to-deposit ratio was 126% at the end of September (129% a year earlier).

The following information on activity is in local criteria. Customer loans amounted to £200,800 million, 1% more than September 2010 and driven by the strong increase in loans to SMEs (+27%), offsetting the drop in personal loans. The stock of mortgages was unchanged.

In a still weak market, net mortgage lending in the third quarter amounted to £600 million. Gross new mortgages amounted to £16,800 million, £2,400 million less than in the first nine months of 2010. Our estimated market share in the quarter is 18%, above our natural share. The third quarter results were the best of the year for net and gross mortgage lending. Spreads improved, while the loan-to-value (LTV) on new loans was 65% and on the stock of lending 52%.

Loans to SMEs via the network of regional business centres kept up their strong pace and amounted to £10,200 million, 27% higher than in the first nine months of 2010. The market share was 4.3%, 0.9 p.p. more than in September 2010.

Personal loans (UPLs) balances were 15% lower year-on-year at £3,000 million. Selective marketing of this product was begun a few months ago at favourable risk adjusted spreads to lower risk customers. This is reflected in the increase in gross lending (+12% y-o-y).

Santander UK continued to dispose of non-strategic assets. Their portfolio stood at £6,400 in September, 32% lower than at the end of 2010 and 70% below December 2008.

Retail deposits (£150,800 million) are very similar to those of September 2010, due to the slowdown in the UK deposits market and tough competition in prices.

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INFORMATION BY PRINCIPAL SEGMENTS

The loan-to-deposits ratio was 126%, 3 p.p. less than in September 2010. In the first nine months £23,200 million of medium and long-term securities were issued, which helped to improve the bank’s financing position, as they replaced short term funding and expensive retail deposits. The issues cover a broad range of products and at good rates given the market environment.

The opening circa 650,000 current accounts in the first nine months continued to reflect the success in attracting quality customers. A marketing campaign was launched in September to promote new current accounts and credit cards, as part of a new strategy to develop better and more lasting relations with customers. The new current account offers better incentives to existing customers who change their main account to Santander and credit card cashback (reimbursements / rebates on purchases), which will help to increase placement of cards (total: 404,000; +22%).

Results

Attributable profit was £659 million, following the impact of the extraordinary provision established for PPI claims. Excluding this one-off, profit was £1,198 million.

Gross income declined from £4,102 million in the first nine months of 2010 to £3,780 million, due to the new liquidity regulations, the higher cost of funding and maintaining very low interest rates

Net interest income was 11.2% lower year-on-year, reflecting the higher cost of liquid assets. The total commercial spread was slightly lower at 1.96%, with higher spreads on loans more than offset by the greater cost of liquidity and funding.

Customers’ preference for variable rates mortgages continued, although at a slower pace than in 2010, and helped to mitigate the impact of low interest rates. Higher net interest income in SMEs and corporations reflected growth in deposits and loans, with spreads on new loans continuing to increase.

Net fee income was 3.4% higher, due to the change in the structure of fee income from retail banking, where interest on overdrafts was replaced by a flat rate.

Gains on financial transactions remained flat, due to the impact of market volatility.

Operating expenses were slightly higher (+0.9%) in nominal terms (lower in real terms after adjusting for inflation) than in the first nine months of 2010 due to investments to grow Corporate Banking and Global Banking & Markets. The hiring of 1,100 people to improve customer service was completed in the first half of 2011, which enabled Santander UK to repatriate to the UK telephone attention centres that were abroad.

The efficiency ratio was 43.8%, 3.8 p.p. worse than September 2010. If we exclude the negative impact of regulatory changes, the efficiency ratio would have been around 40% and broadly similar to 2010.

Loan-loss provisions were 41.5% lower, due to the improved evolution of retail products.

The NPL ratio continued to evolve better than expected and only inched up 0.11 p.p. since September 2010 to 1.88%. There was a better performance in all products for individual customers, particularly mortgages and personal loans, and a slight deterioration in the third quarter in corporate loans. The stock of properties in possession remained very low (0.06% of the total portfolio compared to 0.05% at the end of 2010). In general, the trends were better than the sector’s, according to the Council of Mortgage Lenders (CML).

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INFORMATION BY PRINCIPAL SEGMENTS

LATIN AMERICA

• Enhanced profile of the income statement with greater role of customer revenues and commercial activity. Basic revenues: +11.5%.

• Net operating income after provisions increased 2.4% (in local currency).

• Strong business orientation, reflected in a faster pace of activity, both in lending (+19%) and in deposits (+9%).

• NPLs remained low, reflecting the good economic environment and active management of risk.

Santander generated attributable profit of EUR 3,528 million in the first nine months of 2011, 3.0% more than in the same period of 2010, both in euros and in constant currency.

Economic environment

The region’s growth continued to be strong in the second quarter at around 4.2% on average. The consensus of analysis for the whole of 2011 is a little lower, impacted by the deterioration in the international environment.

Inflation varies, with a group of countries at close to 3% and under control (Chile, Colombia, Mexico and Peru) and another group with higher rates (Brazil, Uruguay and Argentina).

Although during the second quarter, most central banks continued to lift their interest rates, in the last two months they began to change their stance, in recognition of the deterioration in the international environment. This change will ease pressures on inflation and on productive activity. In this context, Brazil’s central bank decided at its last two meetings to cut its Selic rate, while the rest of central banks held their rates and adopted downward stances in their monetary policy statements.

As regards external demand, exports continued to surge in the second quarter (+28% y-o-y, up from +26% in the first quarter). The region has a very healthy external position, with a moderate current account deficit of 1.7% of GDP this year, according to the consensus of forecasts, and high capital inflows including a significant direct investment component. The stock of international reserves was $644 billion in June (13.4% of the estimated GDP for 2011).

The evolution of public sector accounts is also good, with an overall fiscal deficit of less than 2.5% of GDP and public debt at around 50% of GDP. This gives Latin America a significant cushion externally and fiscally to face any external shocks.

In the countries where Santander operates, bank savings increased 17% year-on-year (+14% demand deposits).

Lending by the region’s banking systems, after recovering in 2010, increased 20% in the last 12 months excluding the exchange rate impact. Loans to individuals increased 23%, via credit cards 20%, consumer credit also rose 20% and loans to companies and institutions 19%. In general terms, and considering the financial systems with the greatest weight, Brazil and Mexico’s savings grew the most.

Because of their impact on business and on converting figures into euros, the evolution of interest rates and exchange rates is commented on:

• Average short-term interest rates, based on the region’s average weighted rate, rose between the first nine months of 2010 and the same period of 2011. In general terms, interest rates began to rise in the second half of 2010 and gradually increased throughout the year. In the second half of 2011, however, in view of the worsening of the international macroeconomic scenario and the uncertainty in the financial markets, central banks decided to adopt a downward stance in their monetary policies, which is already reflecting in their short term interest rates.

38 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

• The evolution of results in euros is affected by average exchange rates. In global terms, Latin American currencies appreciated against the dollar, except for the Argentine peso, while the dollar, the reference currency in Latin America, depreciated 7% against the euro. In average terms, the Brazilian real strengthened against the euro from 2.33 to 2.29 and the Chilean peso from 682 to 667, while the Mexican peso depreciated from 16.67 to 16.91.

Overall, the favourable impact from the conversion of the results to euros is less than 1 p.p. in revenues and costs and zero in profits.

Strategy

The financial systems benefited from the favourable economic environment, underscored by the strong growth in lending and savings.

In these circumstances, the Bank continued to focus on harmonious growth in the balance sheet, with a clear emphasis on customer deposits and safeguarding the liquidity position.

The Bank also continued to focus on selective growth in lending, managing spreads, optimising the mix of products and segments and handling appropriately the risk/return relation.

The pillars of a strategy centred on creating value for customers and shareholders were efficiency in costs, in a context of investments and new commercial projects, prudence in risks and efficient management of capital and liquidity.

The Group also kept the emphasis on customer management, focusing on linkage and transactions.

At the end of September, the Group had 5,964 traditional branches and points of banking attention and in companies. Grupo Santander is the largest franchise in the region. Its aim is to double the business volumes of the next competitor.

The main developments in business and results in the first half of 2011 are set out below. All percentage changes exclude the exchange-rate impact.

Activity

Lending increased 19% year-on-year (+18% excluding the $2 billion purchase of the portfolio of mortgages from General Electric in Mexico), with growth in all products and segments. Of note in the last twelve months was the 26% growth in cards and 21% in commercial credits (companies in all their range and institutions) and 28% in mortgage loans (+16% excluding GE).

Deposits rose 9%, (demand: +8% and time: +9%). Mutual funds increased 17% (+11% for total savings y-o-y).

The average market shares in the countries where the Group operates are 11.2% in loans; 9.6% in deposits and 9.5% in total banking business.

Main focuses of management in 2011

1 Focus on generating revenues, with strong business, management of spreads and activities that generate fee income.

2	Focus on customer deposits.
3	Selective growth in lending, centred on the margins net of risk premiums.
4	Management of customers, focused on linkage and transactions.
5	Investment in installed capacity in all countries under the principle of austerity and efficiency.

Results

Basic revenues (net interest income, fee income plus insurance) continued the good trend. They rose 11.5% year-on-year, with net interest income up 11.5%, fee income 10.1% and 44.8% from insurance business.

The rise in fee income (+10.1%) was due to the 41.5% advance in revenues from insurance, 26.4% from cards and 7.9% from mutual funds.

Gains on financial transactions dropped 9.3% year-on-year. Gross income increased 9.7%.

Operating expenses were up 11.4% year-on-year, due to new business projects, expanding the installed capacity, restructuring the points of attention and renegotiating charges and collective bargaining agreements in line with inflation. The efficiency ratio was 38.9%, almost the same as in September 2010.

The current macroeconomic environment, together with anticipative risk management, produced an improvement in risk premiums (from 3.9% in September 2010 to 3.6% in the same month of 2011). The NPL ratio was 4.10% (4.15% in September 2010) and coverage 102%.

Attributable profit was EUR 3,528 million, 3.0% more than in the first nine months of 2010.

Retail Banking’s attributable profit rose 2.4% year-on-year, Asset Management and Insurance’s 10.7% and Global Wholesale Banking’s 2.4%.

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 39

INFORMATION BY PRINCIPAL SEGMENTS

LATIN AMERICA. MAIN UNITS
Million euros

	Brazil						Mexico						Chile
	9M’11			Var (%)			9M’11			Var (%)			9M’11			Var (%)
INCOME STATEMENT
Net interest income		8,928			16.2			1,255			2.9			1,133			1.3
Net fees		2,476			11.1			461			7.9			323			8.5
Gains (losses) on financial transactions		691			2.0			102			(38.2	)		66			(14.1	)
Other operating income (1)		(106	)		77.1			5			—			38			68.4
Gross income		11,989			13.9			1,823			1.1			1,559			3.0
Operating expenses		(4,410	)		12.7			(725	)		6.5			(607	)		12.5
General administrative expenses		(3,939	)		10.9			(644	)		7.1			(540	)		13.0
Personnel		(2,167	)		15.7			(350	)		10.1			(342	)		14.5
Other general administrative expenses		(1,772	)		5.5			(294	)		3.6			(198	)		10.5
Depreciation and amortisation		(471	)		30.6			(81	)		1.9			(67	)		8.3
Net operating income		7,579			14.6			1,097			(2.2	)		952			(2.3	)
Net loan-loss provisions		(3,539	)		27.7			(252	)		(29.9	)		(291	)		10.3
Other income		(792	)		25.9			53			—			26			—
Profit before taxes		3,248			1.1			899			24.2			687			(2.7	)
Tax on profit		(861	)		11.7			(166	)		29.9			(88	)		(7.0	)
Profit from continuing operations		2,387			(2.3	)		732			23.0			599			(2.1	)
Net profit from discontinued operations		—			—			—			—			—			—
Consolidated profit		2,387			(2.3	)		732			23.0			599			(2.1	)
Minority interests		414			9.0			1			(99.2	)		132			3.0
Attributable profit to the Group		1,973			(4.4	)		731			57.0			466			(3.4	)
BALANCE SHEET
Customer loans (2)		71,736			10.3			17,477			21.8			25,176			6.7
Trading portfolio (w/o loans)		13,327			26.8			14,377			(1.0	)		3,283			(24.5	)
Available-for-sale financial assets		18,221			4.1			2,514			(37.3	)		3,512			14.0
Due from credit institutions (2)		9,818			(12.9	)		7,462			12.4			2,860			28.0
Intangible assets and property and equipment		3,469			1.4			339			(8.8	)		326			(6.3	)
Other assets		42,127			10.3			3,890			(0.9	)		3,405			19.0
Total assets/liabilities & shareholders’ equity		158,697			8.7			46,058			5.1			38,563			5.8
Customer deposits (2)		71,211			(3.5	)		19,615			1.3			19,305			15.8
Marketable debt securities (2)		15,379			133.1			1,504			298.1			5,174			5.0
Subordinated debt (2)		4,230			4.0			—			—			1,223			13.6
Insurance liabilities		8,178			250.6			428			45.2			333			13.8
Due to credit institutions (2)		24,777			16.7			10,009			16.2			4,874			5.8
Other liabilities		24,800			(3.7	)		10,253			(6.3	)		5,430			(18.9	)
Shareholders’ equity (3)		10,123			(16.7	)		4,248			0.4			2,224			2.0
Other customer funds under management		44,481			12.8			9,765			(3.5	)		4,712			(10.2	)
Mutual funds		40,623			15.1			9,545			(4.6	)		4,635			(10.7	)
Pension funds		—			—			—			—			—			—
Managed portfolios		3,449			(15.1	)		—			—			—			—
Savings-insurance policies		410			580.7			220			109.0			77			34.3
Customer funds under management		135,300			9.2			30,884			3.5			30,414			8.9

(1).	- Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

LATIN AMERICA. INCOME STATEMENT
Million euros

	Gross					Net operating						Attributable
	income					income						profit to the Group
	9M’11		Var (%)			9M’11			Var (%)			9M’11			Var (%)
Brazil		11,989		13.9			7,579			14.6			1,973			(4.4	)
Mexico		1,823		1.1			1,097			(2.2	)		731			57.0
Chile		1,559		3.0			952			(2.3	)		466			(3.4	)
Argentina		668		11.3			342			5.7			205			(4.2	)
Uruguay		119		(11.4	)		28			(57.6	)		13			(76.4	)
Colombia		148		6.8			63			8.3			30			9.0
Puerto Rico		255		(8.0	)		131			(9.8	)		26			(0.8	)
Rest		87		(3.6	)		(8	)		—			(23	)		81.4
Subtotal		16,647		10.4			10,184			9.5			3,422			3.0
Santander Private Banking		219		5.0			125			6.5			106			1.9
Total		16,866		10.3			10,308			9.4			3,528			3.0

40 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

BRAZIL (ALL CHANGES IN LOCAL CURRENCY)

• New quarterly record in gross income (+13.3% in basic revenues year-on-year ).

• Operating expenses reflect the collective agreement and the commercial investment (opening 167 branches in 12 months).

• Higher provisions due to increased business and moderate rise in the sector’s NPLs.

• Net operating income after provisions increased 3.2%.

• Lending and savings grew 8% and 1%, respectively, in the third quarter over the second.

Santander Brazil generated attributable profit of EUR 1,973 million in the first nine months, 4.4% lower than in the same period of 2010 (-6.1% in local currency).

The top part of the income statement is very solid. Gross income rose 11.8% which coupled with a slight improvement in the efficiency ratio, now at 36.8%, produced a 12.5% increase in net operating income.

This increase enabled the larger provisions to be absorbed, maintaining net operating income after provisions in positive growth rates. This, however, did feed through to profits mainly because of the higher tax rate and minority interests, which combined, had a negative impact of 7 p.p. on profit growth.

Economic and financial environment

The latest figures show GDP growing at 3.1% year-on-year (down from 4.2% in the first quarter). Industrial output and consumer confidence remained high and the unemployment rate was historically low.

The combination of these factors, together with seasonal pressures, kept inflation high (7.3%) and above target. In this context, the central bank began to lift interest rates, interrupting the process at the Copom meeting in August because of the deterioration of the macroeconomic situation in some European countries and prospects of reduced growth in emerging countries.

The banking system’s total lending grew 1.7% in August (latest available) and 19.4% in 12 months. Loans represent 48% of GDP.

Unrestricted lending grew at a slower pace than directed lending, both in August (latest figure available) (1.4% vs. +1.7%), as well as year-on-year (+17.9% vs. +19.4%).

The NPL ratio was 5.3% in August, 0.8 p.p. more than at the end of 2010.

Strategy

Santander Brazil is the third largest private sector bank in terms of assets, and the leading foreign bank, with a combined market share of 9.3% in loans and deposits. It operates in the main regions, with 3,731 branches and points of banking attention, 18,342 ATMs and 24.7 million customers.

At the beginning of the year, it successfully completed the technological integration and brand unification. The bank is now better structured and positioned to develop its business.

The strategy is to become the best and most efficient bank in Brazil, both in generation of shareholder value as well as in customer and employee satisfaction. The following goals have been set:

• Be the best in quality of service, backed by the strength of the IT platform.

• Intensify relations with customers.

• Business strengthening in key segments such as SMEs, acquiring business, cards, real estate loans and consumer credit; and boost cross-selling.

• Better recognition of the brand.

• All of this accompanied by prudent risk management.

Activity

Lending rose 8% in local currency quarter-on quarter, a higher growth rate than that of the second quarter, while deposits rose only 1% due to the wholesale segment.

The year-on-year growth in lending was 19%, backed by loans to individuals (+25%), particularly mortgages (+45%) and cards (+32%), but also in the segments of SMEs and companies (+25% combined). The smallest rise, as in previous quarters, was to large companies (+14%).

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 41

INFORMATION BY PRINCIPAL SEGMENTS

Savings rose 11% year-on-year, with a good performance in all products (time deposits: +4% and mutual funds: +24%).

The market share in lending was 10.4% (11.7% in unrestricted lending) and 8.0% in deposits.

Results

Gross income rose again in the quarter. It amounted to EUR 11,989 million, 11.8% higher year-to-year in local currency.

The main component of year-on-year growth was net interest income (+14.1%), spurred by the larger volumes and management of spreads.

The good trend in fee income, (+9.1%) backed by mutual funds and particularly by cards and insurance, which increased by more than 30%. The recurrence ratio was 63%.

Gains on financial transactions were EUR 691 million (+0.2% year-on-year) with those for the third quarter below the second, and only accounted for 6% of total revenues.

As regards the third quarter compared to the second, gross income was again more than EUR 4,000 million, a new quarterly record, due to the favourable evolution of net interest income (+2.6% in the quarter).

Of note in revenues growth in the last few quarters was its continuous upward trend, as net interest income increased for the sixth straight quarter and fee income did so in four of the last six quarters.

The year-on-year growth in total basic revenues (net interest income, fee income and fees from insurance activity) went from 5.9% in 2010 to 13.3% in the first nine months of 2011.

Operating expenses grew 10.7% year-on-year. This was due to the investment made to increase the distribution capacity with the opening of 167 branches in 12 months (+21 new branches in the quarter) and in the new IT platform, along with the pressure from inflation and the impact of the high employment rate on wage agreements.

Net operating income rose 12.5% to EUR 7,579 million and the efficiency ratio improved slightly to 36.8%.

Provisions for loan losses were 25.4% higher than in the first nine months of 2010, due to the increase of close to 20% in lending balances and a moderate rise in the NPLs of individual borrowers and SMEs. In the third quarter over the second, they declined 0.8%.

The NPL ratio was flat in the quarter, although it rose slightly in the last 12 months. It was 5.05% in September (4.97% a year earlier). Coverage increased to 100% from 98% in September 2010.

Net operating income after provisions increased 3.2% year-on-year, driven by the strength of the most basic revenues, which absorbed the investments in installed capacity and provisions. Profit before tax was 0.7% lower, due to the greater impact of other income and provisions for labour disputes.

Including the impact of the higher tax rate and larger minority interests from the partial placement of shares in the third quarter of 2010, attributable profit was 6.1% lower at EUR 1,973 million and ROE was 23.0%).

Retail Banking’s profit was 13.2% lower, while that of GBM rose 8.6% and Asset Management and Insurance remained virtually unchanged. Net operating income after provisions declined 0.7% in retail banking, and increased 10.1% in GBM and 16.2% in asset management and insurance.

42 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

MEXICO (ALL CHANGES IN LOCAL CURRENCY)

• Basic revenues continued to accelerate: net interest income and fee income registered double digit growth between the third quarter of 2010 and the same period of 2011.

• Costs rose 8.0% because of increased commercial capacity.

• Good risk management produced an improvement in the risk premium and a 28.9% fall in loan-loss provisions.

• Net operating income after provisions increased 12.4% and profit 24.8% before minority interests.

• Strong rise in business: lending rose 24% year-on-year on a like-for-like basis and deposits 13%.

Attributable profit was 57.0% higher in the first nine months at EUR 731 million (+59.3% in local currency), partly benefiting from lower minority interests.

Results showed a good trend, with year-on-year growth in net interest income and fee income and lower provisions.

Santander is the third largest banking group in Mexico by business volume, with a market share in loans of 16.4% and 14.9% in savings. It has 1,099 branches and 9.2 million customers.

Economic environment

GDP growth was slower in the second quarter, with 4.0% growth year-on-year in the first half, and is forecast at 3.8% for the whole year, due to the impact of the weak US economy. Domestic demand is maintaining a good pace of growth, thanks to job creation, with rises of more than 4% year-on-year and an improvement in real wages. Inflation remains very moderate (3.1% in September), with equally moderate expectations (3.5% for the whole year).

Lending increased 15% year-on-year (consumer credit and card business: +18%), while savings rose 14%.

Strategy

Under its plan, the strategy continued to focus on strengthening the franchise and customer relations through consumer credit, the sale of credit cards in branches and growth in deposits, for individual customers, all of which is boosting recurring revenues. In companies and institutions, the focus was on more transactions.

The main priorities are to take advantage of the economic performance, put the emphasis on customer linkage, deepen business in high income and SMEs segments and maintain prudent and efficient management of risks and costs.

Activity

Lending rose 32% year-on-year, with all products growing and partly spurred by the purchase of GE’s mortgage portfolio (+24% on a like-for-like basis). Mortgages doubled (+34% on a like-for-like basis) commercial credit grew 27%, consumer loans 28% and cards 10%.

Savings increased 10% year-on-year, with 13% growth both in demand and time deposits and more moderate in mutual funds (+4%).

Among anchor products, the number of insurance policies stood at 4.7 million (+15% year-on-year) and the number of payroll cheques paid into accounts reached 2.6 million.

Results

Gross income increased 2.5% year-on-year. Net interest income increased 4.4% and accelerated in the quarter (+8.1% over the second quarter), in line with the recovery in business.

Fee income grew 9.5%, with a positive performance in insurance and transactional banking.

Operating expenses were 8.0% higher than in the first nine months of 2010, reflecting the larger perimeter and installed capacity. Provisions confirmed the trend of previous quarters, falling 28.9%, in line with the improvement in risk premiums. Net operating income after provisions increased 12.4% year-on-year.

Attributable profit amounted to EUR 731 million. Retail Banking’s profit increased 89.3% thanks to the recovery in revenues and lower provisions. Asset Management and Insurance’s rose 72.2% and Global Wholesale Banking’s dropped 17.1%, due to reduced results from markets and the worsening global economic environment. Excluding the impact of the minority interests acquired in September 2010, the changes were +24.8% for the whole country and +48.7%, +37.5% and -35.8% for the three business segments, respectively.

The efficiency ratio was 39.8%, the recurrence ratio 71.5% and ROE 21.6%. The NPL ratio (1.78%) and coverage (176%) are affected by the incorporation of GE’s portfolio. Excluding this, the NPL ratio was 1.45% and coverage 217%, both of high quality and a good year-on-year evolution.

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 43

INFORMATION BY PRINCIPAL SEGMENTS

CHILE (ALL CHANGES IN LOCAL CURRENCY)

• Basic revenues rose +1.7%. Focus on fee-generating businesses (+14.7% from cash management, +11.1% from cards and +7.0% from insurance).

• Operating expenses rose 9.9% because of the signing of the collective agreement and new business projects.

• Provisions were 7.8% higher.

• Net operating income after loan-loss provisions dropped 9.1%

• Double-digit growth in banking business: +14% in loans and +23% in deposits.

Attributable profit was EUR 466 million, 3.4% less than in the first nine months of 2010 (-5.6% in local currency).

Santander is the largest financial group in Chile in terms of assets and profits. It has 494 branches and 3.4 million customers and market shares of 21.0% in loans and 18.3% in savings.

Economic environment

The economy grew 6.8% in the second quarter, with private domestic demand (consumption and investment) growing at 10%. Employment increased 6.4% in the first half, reducing the jobless rate from 8.5% to 7.2% a year ago. Inflation remained moderate (3.3% y-o-y in September), with prospects of stability in the medium term, according to the central bank’s survey. In this context, the central bank has kept its interest rates stable since July, after raising them by 200 b.p. in the first seven months to 5.25%.

Lending rose 14% in the last 12 months (+18% in consumer credit and cards and +15% in commercial credit). Savings rose 14%.

Strategy

The strategy centred on maximising the profitability of various businesses, particularly loans to and savings from individuals and SMEs, with a special emphasis on deposits in order to bolster the liquidity position.

Means of payment continued to be dynamic. Purchases with Santander cards increased 29%. Commercial agreements with significant suppliers of services, such as airlines, telecom companies and supermarkets, continued to strengthen the relationship with customers in order to make them more satisfied and generate greater added value.

The improvement in service quality continued to be a priority in order to boost customer linkage and transactions.

The number of insurance policies, a risk-free product and one generating fee income, was 4.9 million, consumer loans rose 8% and cards increased by 213,000 units. Payrolls increased 13% and helped to enhance the quality of the customer base and future business prospects.

Activity

Lending rose 14% year-on-year, with a significant advance in cards (+29%), 12% in mortgages and 11% in consumer credit. The market share in loans increased by 42 b.p. in the last 12 months, from 20.6% to 21.0%.

Savings grew at a faster pace (+16%). Demand deposits rose 11% and time deposits 30%. Mutual funds declined 5%.

Results

In results (and always in local currency), gross income rose 0.6% year-on-year, with a differentiated performance of its components. Net interest income declined 1.0% affected by pressure on lending spreads, the higher cost from the effort made in capturing deposits, mainly time deposits, and the significant impact in the third quarter of the lower inflation.

Fee income, on the other hand, rose 6.0%, with a good performance in that from cash management (+14.7%), cards (+11.1%), insurance (+7.0%) and mutual funds (+3.9%).

Operating expenses rose 9.9% year-on-year, higher than inflation, due to the collective agreement, the increase in the rent for branches following their transfer in the second half of 2010 and strengthening business activity.

Net loan-loss provisions rose 7.8% year-on-year, compared to the 14% rise in lending. In the third quarter there was a higher increase.

Attributable profit was 3.4% lower at EUR 466 million (-5.6% in local currency). Retail Banking’s profit dropped 12.8%, Asset Management and Insurance’s rose 22.1% and Global Wholesale Banking’s 12.4%.

The efficiency ratio was 38.9%, the recurrence ratio 59.8% and ROE 24.8%. The NPL ratio was 3.63% and coverage 88%.

44 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

Argentina

Attributable profit was EUR 205 million, 4.2% lower year-on-year (+7.9% in local currency).

Santander Río is one of the country’s leading banks, with market shares of 9.3% in lending and 10.3% in savings. It has 351 branches and 2.4 million customers.

The economy continues to grow briskly (+8.9% y-o-y in the first half). Growth for the whole year is put at around 7%. Inflation was 9.9% in September and interest rates reached close to 13% in September. Exports grew an average 24% year-on-year to July which, although below the 42% rise in imports, still left a trade surplus of $6,500 million. The surplus is forecast at 1.8% of GDP by the end of the year.

Growth in the financial system’s savings and lending was 35% and 51%, respectively, maintaining high levels of liquidity and a capitalisation ratio of 16% in July. The NPL ratio was 1.8% and coverage 126%, underscoring the system’s enhanced quality.

The Group is focusing on continuing to maximise the profitability of the franchise through the following drivers: increase the number of customers by opening branches in attractive markets, customer linkage via transactions, higher spreads on loans, selective growth in low risk assets, maintaining comfortable levels of liquidity, deepening in high value segments (high income and SMEs) and special attention to risk.

Lending and savings increased at a faster pace in September (+34% and +38% year-on-year, respectively).

Gross income rose 25.3% year-on-year in local currency (+23.4% in net interest income and +33.7% in fee income). Operating expenses rose 32.6%, due to inflation and growth in installed capacity (net opening of 34 branches in the last 12 months). In addition, the number of employees increased from 6,388 to 6,788.

Net operating income increased 19.0% and attributable profit 7.9%. The efficiency ratio was 48.8% and the recurrence ratio 89%. The NPL ratio was 1.08% and coverage 210%.

Uruguay

Attributable profit was EUR 13 million, 76.4% lower (-75.9% in local currency), due to the 54.3% fall in gains on financial transactions (significant capital gains in 2010 in the portfolio of securities). Basic revenues rose 16.4%, while operating expenses were 35.1% higher because of the collective bargaining agreement and the cost of installing the new IT platform.

Santander is the largest private sector bank in the country in terms of number of branches (78) and business (market share of 17.7% in lending and 16.2% in deposits).

The economy grew 0.5% in the second quarter and 4.8% year-on-year, spurred by domestic demand (+12%). Inflation remained high at 7.8% y-o-y at September. In local currency, the financial system’s lending rose at a faster pace, +27%, while deposits increased 13%.

Fitch upgraded in July Uruguay’s sovereign debt in foreign currency by one notch to BB+, one level below the minimum investment grade (BBB-).

The Group is focusing on driving retail business, with strong growth in linked medium and high income customers, boosting business with companies, with an emphasis on transactional linkage, and maximising the return on surplus liquidity.

Lending rose 40% with the incorporation of Creditel and 33% on a like-for-like basis. Savings rose 6% in the last 12 months.

The efficiency ratio is 76.7%, the recurrence ratio 29.1%, the NPL ratio is only 0.65% and coverage is very high.

Colombia

Attributable profit was 9.0% higher at EUR 30 million (+11.8% in local currency, affected by taxes and other income), as net operating income after provisions for loan losses (20.8% lower) increased 34.4%.

The Group has 79 branches and market shares of 2.7% in lending and in savings.

The economy is forecast to grow 5% this year, inflation will remain low (3.7% in September) and the trade surplus was $2,140 million in the first half.

The financial system’s growth in lending and deposits picked up (+27% and +20%, respectively).

The strategy is focused on selective growth in business, preserving appropriate levels of customer linkage of high and medium income customers and boosting transaction and insurance business. Management of NPLs is based on anticipation and knowledge of the customer.

Lending increased 18% and savings 20%. The efficiency ratio is 57.6% and the recurrence ratio 44.9%. The NPL ratio is 1.14% and coverage 261%.

Puerto Rico

Attributable profit was EUR 26 million (+6.3% y-o-y in dollars), because of higher taxes as net operating income after provisions increased 52.7% thanks to lower provisions.

Santander has 122 branches and market shares of 9.8% in loans, 11.2% in deposits and 21.7% in mutual funds.

The economy remained in recession, affecting the growth of the financial system and its profitability. In this context, the Group stood out for its positive return, fruit of appropriate management of prices, discipline in risks and strict control of costs.

The efficiency ratio is 48.8%, the recurrence ratio 39.6%, the NPL ratio 10.6% and coverage 55%.

Peru

Activity is focused on companies and tending to the Group’s global customers. Attributable profit was EUR 8 million (+50.9% in local currency).

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 45

INFORMATION BY PRINCIPAL SEGMENTS

SOVEREIGN
Million euros

							Variation
	9M’11			9M’10			Amount			(%)
INCOME STATEMENT
Net interest income		1,261			1,320			(59	)		(4.5	)
Net fees		289			312			(23	)		(7.4	)
Gains (losses) on financial transactions		103			7			96			—
Other operating income (1)		(44	)		(51	)		6			(12.8	)
Gross income		1,609			1,589			20			1.3
Operating expenses		(704	)		(697	)		(6	)		0.9
General administrative expenses		(621	)		(619	)		(2	)		0.3
Personnel		(350	)		(349	)		(1	)		0.2
Other general administrative expenses		(271	)		(270	)		(1	)		0.4
Depreciation and amortisation		(83	)		(78	)		(5	)		5.8
Net operating income		905			891			14			1.5
Net loan-loss provisions		(257	)		(453	)		196			(43.2	)
Other income		(72	)		(17	)		(55	)		322.0
Profit before taxes		575			421			154			36.7
Tax on profit		(181	)		(128	)		(53	)		41.2
Profit from continuing operations		394			293			102			34.7
Net profit from discontinued operations		—			—			—			—
Consolidated profit		394			293			102			34.7
Minority interests		—			—			—			—
Attributable profit to the Group		394			293			102			34.7
BALANCE SHEET
Customer loans (2)		37,936			35,565			2,372			6.7
Trading portfolio (w/o loans)		269			252			17			6.7
Available-for-sale financial assets		10,438			8,860			1,579			17.8
Due from credit institutions (2)		807			530			277			52.4
Intangible assets and property and equipment		555			464			91			19.6
Other assets		3,812			5,075			(1,263	)		(24.9	)
Total assets/liabilities & shareholders’ equity		53,817			50,745			3,073			6.1
Customer deposits (2)		35,141			30,291			4,850			16.0
Marketable debt securities (2)		1,617			1,834			(218	)		(11.9	)
Subordinated debt (2)		2,293			2,692			(399	)		(14.8	)
Insurance liabilities		—			—			—			—
Due to credit institutions (2)		8,194			10,691			(2,497	)		(23.4	)
Other liabilities		2,231			2,289			(58	)		(2.6	)
Shareholders’ equity (3)		4,342			2,948			1,394			47.3
Other customer funds under management		3			54			(50	)		(93.9	)
Mutual funds		—			—			—			—
Pension funds		—			—			—			—
Managed portfolios		3			54			(50	)		(93.9	)
Savings-insurance policies		—			—			—			—
Customer funds under management		39,054			34,871			4,183			12.0

(1).	-Including dividends, income from equity-accounted method and other operating income/expenses
(2).	- Including all on-balance sheet balances for this item
(3).	- Not including profit of the year

46 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

SOVEREIGN

• Higher gross income (+8.5%) and lower provisions (-39.1%).

• Net operating income after provisions up 58.5%.

• Improved trend in loans (+5%) and deposits (+15%).

• Credit quality: improved non-performing loans and coverage for the seventh quarter running.

Sovereign posted an attributable profit of $195 million in the third quarter, bringing the profit for the first nine months to $554 million, 44.4% more than in the same period of 2010.

Economic environment

Sovereign conducted its activity in an environment of slower GDP growth than in 2010, with a weak housing sector, a jobless rate close to historic highs and interest rates at minimums.

Lending by banks increased in the second quarter (+0.9%) for the first time since June 2008, although it is too early yet to speak of a change of trend. Growth was due to the increase in commercial loans (+1.8%) as consumer credit remained flat. Deposits continued to flow toward those of the greatest availability (+4.6% over the fourth quarter) from time deposits (-3.4% vs. the fourth quarter).

Strategy

Sovereign, with 723 branches, 2,286 ATMs and more than 1.7 million customers, is developing a business model focused on retail customers and companies. It operates in the northeast of the US, one of the country’s most prosperous areas, where it has significant market shares.

The focus on growth, rigorous risk management and the optimisation of cost structures, within the restructuring process, are enabling Sovereign to generate consistent results in line with the goals set for 2011, despite an environment of low activity.

Activity

Balance sheet management remained characterised by an increase in profitability and a better mix of lending and funding products, enabling spreads to improve on new and renewed operations over those of 2010.

In lending, the portfolio continued to be repositioned, with a gradual exit from higher risk segments into more attractive ones.

Although it continued to deepen business in residential segments, the asset mix benefited from growth in loans to companies and GBM. Sovereign continued to prepare its commercial and regulatory structure in order to take advantage of the incipient recovery in these segments.

Total lending grew 5% year-on-year and 8% excluding the non-strategic portfolio. The improvement in the composition of the portfolio combined with risk management produced a further fall in the NPL ratio to 3.22% and a rise in coverage to 93%. Both improved for the seventh quarter running.

The increase in lending was financed by the rise in customer deposits (+15% y-o-y), which enabled the diversification and stability of the financing sources to be improved. This, coupled with the reduction in the volume of wholesale financing, reduced the cost of deposits by 6 b.p.

The focus on expanding the customer base is beginning to bear fruit. The number of current accounts has risen continuously this year, breaking the negative trend of 2010. August set a new monthly record in the opening of accounts.

Results

Gross income was $2,261 million (+8.5% y-o-y). Net interest income (+2.4%) continued to grow thanks to management of volumes and prices which offset the sharp fall in interest rates. The negative impact on fee income (-0.8%), as a result of the new regulatory framework in the US, was offset by a greater commercial effort. The capital gains generated in the ALCO portfolio also contributed to growth.

The 8.1% growth in operating costs reflects the impact of investments in technology and the increase in commercial structures begun in the second half of 2010. The efficiency ratio was 43.7% and net operating income increased 8.8% year-on-year.

Net loan-loss provisions were 39.1% lower, thanks to containment of NPLs and the recovery capacity during the credit cycle. This is reflected in a better than expected evolution in credit quality.

Net operating income after provisions was 58.5% higher at $910 million and profit before tax was $809 million.

In short, the results show a solid income statement backed by the generation of recurring revenues, a reduction in the cost of deposits and an improvement in the levels of provisions thanks to proactive credit risk management. All of this was the result of the improvement in the balance sheet structure, which together with the recovery in volumes of basic loans and control of spending provides a solid base for the fourth quarter.

USA

INCOME STATEMENT PRO FORMA
Million US$

	9M’11		9M’10		Var (%)
Gross income		4,827		4,117		17.3
Net operating income		3,150		2,645		19.1
Attributable profit to the Group		1,125		692		62.5

Grupo Santander’s total attributable profit from the US (Sovereign Bank, Santander Consumer USA, Santander Private Banking USA, Puerto Rico and the New York branch) amounted to $1,125 million, 62.5% more than in the first nine months of 2010.

The main reasons for this growth were the better performance of Sovereign and the consumer finance unit.

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 47

INFORMATION BY PRINCIPAL SEGMENTS

CORPORATE ACTIVITIES
Million euros

							Variation
	9M’11			9M’10			Amount			(%)
INCOME STATEMENT
Net interest income		(1,678	)		(1,369	)		(308	)		22.5
Net fees		(10	)		(32	)		22			(68.2	)
Gains (losses) on financial transactions		370			(226	)		596			—
Dividends		41			42			(1	)		(1.5	)
Income from equity-accounted method		2			(2	)		4			—
Other operating income/expenses (net)		105			100			4			4.2
Gross income		(1,170	)		(1,487	)		317			(21.3	)
Operating expenses		(655	)		(629	)		(26	)		4.1
General administrative expenses		(564	)		(527	)		(37	)		7.0
Personnel		(236	)		(206	)		(29	)		14.3
Other general administrative expenses		(328	)		(321	)		(7	)		2.3
Depreciation and amortisation		(91	)		(102	)		11			(10.9	)
Net operating income		(1,824	)		(2,116	)		292			(13.8	)
Net loan-loss provisions		40			(87	)		128			—
Other income		(351	)		(432	)		81			(18.6	)
Profit before taxes		(2,135	)		(2,635	)		500			(19.0	)
Tax on profit		339			740			(401	)		(54.2	)
Profit from continuing operations		(1,796	)		(1,895	)		99			(5.2	)
Net profit from discontinued operations		(19	)		(10	)		(8	)		77.4
Consolidated profit		(1,814	)		(1,905	)		91			(4.8	)
Minority interests		2			1			1			148.6
Attributable profit to the Group		(1,817	)		(1,906	)		89			(4.7	)
BALANCE SHEET
Trading portfolio (w/o loans)		4,842			4,751			91			1.9
Available-for-sale financial assets		19,806			21,063			(1,257	)		(6.0	)
Investments		959			37			922			—
Goodwill		25,914			23,928			1,986			8.3
Liquidity lent to the Group		15,621			40,197			(24,576	)		(61.1	)
Capital assigned to Group areas		67,798			64,324			3,474			5.4
Other assets		91,989			67,356			24,633			36.6
Total assets/liabilities & shareholders’ equity		226,930			221,657			5,273			2.4
Customer deposits (1)		11,981			14,495			(2,514	)		(17.3	)
Marketable debt securities (1)		61,382			74,396			(13,014	)		(17.5	)
Subordinated debt (1)		8,973			13,866			(4,893	)		(35.3	)
Other liabilities		69,612			50,114			19,498			38.9
Group capital and reserves (2)		74,982			68,786			6,196			9.0
Other customer funds under management		—			—			—			—
Mutual funds		—			—			—			—
Pension funds		—			—			—			—
Managed portfolios		—			—			—			—
Savings-insurance policies		—			—			—			—
Customer funds under management		82,336			102,757			(20,421	)		(19.9	)

(1).	- Including all on-balance sheet balances for this item
(2).	- Not including profit of the year

48 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY PRINCIPAL SEGMENTS

CORPORATE ACTIVITIES

• This area’s losses were EUR 89 million less than in the first nine months of 2010.

• Net interest income registered a larger loss (higher cost of wholesale funding) and lower recovery of taxes.

• Gains on financial transactions (mainly from hedging of exchange rates) are positive versus negative ones in 2010. Also, reduced provisions.

The area made a loss of EUR 1,817 million in the first nine months compared to a loss of EUR 1,906 million in the same period of 2010. This was due to the net effect of the main items: net interest income, gains on financial transactions, provisions and other income, and taxes.

Corporate Activities covers a series of centralised activities, on the basis of the criteria set out on page 24 of this report.

The financial management area carries out global balance sheet management functions, both for structural interest rate risk and liquidity risk (the latter through issues and securitisations), as well as the structural position of exchange rates.

• Interest rate risk is actively managed by taking positions in the market. This management seeks to mitigate the impact of changes in interest rates on net interest income and the Bank’s value, and is carried out via bonds and derivatives of high credit quality, high liquidity and low consumption of capital.

• The aim of structural liquidity management is to finance the Group’s recurrent activity in optimum maturity and cost conditions, while maintaining an appropriate profile by diversifying sources.

• The exposure to exchange rate movements is also managed on a centralised basis. This management (dynamic) is carried out through financial derivatives for exchange rates, optimising at all times the cost of hedging.

In this sense, hedging of net investments in the shareholders’ equity of businesses abroad aims to neutralise the impact on them of converting to euros the balances of the main consolidated entities whose functional currency is not the euro. The Group’s policy considers it necessary to immunise the impact which, in situations of high volatility in the markets, sharp movements in exchange rates would have on these exposures of a permanent nature. The currently hedged investments are those in Brazil, the UK, Mexico, Chile and Poland, and the instruments used are spot contracts, FX forwards or tunnel options.

Meanwhile, exposures of a temporary nature (i.e. those regarding the results which the Group’s units will contribute over the next 12 months), when they are in currencies other than the euro, are also hedged on a centralised basis. These results, generated in the local currencies of the units, are hedged with exchange-rate derivatives. The objective is to establish the euros resulting from the exchange rate at the beginning of the year.

The impact of the hedging is registered in gains/losses on financial transactions and the hedging of results compensates, with an opposite sign, the greater or lesser value in euros from the contribution of businesses.

Separately from the financial management activities described here, the corporate activities area acts as the Group’s holding. It manages all capital and reserves and allocations of capital to each of the units as well as providing liquidity that some of the business units might need (mainly the Santander Branch Network and corporate in Spain). The price at which these operations are carried out is the market rate (euribor or swap) plus the premium, which, in terms of liquidity, the Group supports due to the immobilisation of funds during the period of the operation.

Lastly, and more marginally, the equity stakes that the Group takes within its policy of optimising investments are reflected in Corporate Activities. Since 2009 this item has declined significantly.

The main developments were:

• Net interest income was EUR 1,678 million negative compared to EUR 1,369 million also negative in the first nine months of 2010. This was largely due to the higher cost of credit of issues in wholesale markets.

This increased cost was also reflected in the financing of the goodwill of the Group’s investments, which by definition is negative, but also raised the cost of their financing proportionately.

The third quarter figure was -EUR 553 million, almost the same as in the second quarter (-EUR 613 million).

• Gains on financial transactions, which include those from centralised management of interest rate and currency risk of the parent bank as well as from equities, were EUR 370 million positive in the first nine months due to the positive impact of exchange-rate hedging compared to a loss of EUR 226 million in the same period of 2010 (negative impact of hedging of exchange rates).

• Operating expenses rose 4.1% because of the higher general costs, as amortisations were 10.9% lower.

• Net loan-loss provisions reflect a release of EUR 40 million compared to provisions of EUR 87 million in the first nine months of 2010. This line records the normal provisions for the fixed-income portfolio (not public debt) which were part of the ALCO strategies, and which at the time of purchases and sales produced small movements in these provisions. Also recorded are those asymmetries produced in the process of internal consolidation between the various business areas included in the parent bank which gave rise to a release of generic provisions in 2011.

• “Other income” was EUR 351 million negative compared to EUR 432 million also negative in 2010 and is mainly due to writedowns for foreclosures (properties and land) and revenue from the recovery of losses that were provisioned, as well as the sale of a small stake.

• Lastly, the tax line reflects a smaller recovery than in 2010.

      JANUARY — SEPTEMBER FINANCIAL REPORT 2011 49

INFORMATION BY SECONDARY SEGMENTS

RETAIL BANKING

• Net interest income (+5.1%) and fee income (+12.6%) led to a new quarterly record in basic revenues.

• Higher expenses (+9.2%) because of new projects and an increase in the installed capacity.

• Risk management reflected in lower specific provisions, offset by lower release of generic provisions.

• Net operating income after provisions was 8.0% higher year-on-year.

• Profit reflects the impact of the one-off in the second quarter for customer remediation in the UK.

Attributable profit was EUR 5,330 million, affected by the provision net of tax of EUR 620 million for customer remediation in the UK in the second quarter.

Results were slightly impacted by the perimeter effect (mainly from the incorporation of Bank Zachodni WBK). The positive impact was around three percentage points on revenues and costs. The evolution of exchange rates during the period had a slight negative impact (-1 p.p.).

Gross income amounted to EUR 29,924 million (+6.0% y-o-y), due to the 5.1% rise in net interest income, the main component, and strongly backed by fee income.

Operating expenses rose 9.2% year-on-year (+5.8% without the perimeter and exchange rate effects). As a result, the efficiency ratio was 42.0% and net operating income was 3.8% higher at EUR 17,341 million.

Net loan-loss provisions were 1.0% lower than in the first nine months of 2010. This reflected the efforts made in previous years to improve risk management in the Group’s units and led to lower specific provisions. This, together with the one-off impact of the provision made in 2010 in Spain because of the change in regulation, offset the lower release of generic provisions. Net operating income after provisions increased 8.0% year-on-year.

Total lending and customer deposits rose slightly in the last twelve months.

As well as reflecting the recovery trend in commercial revenues and the positive impact of new incorporations to the Group, Retail Banking in Continental Europe benefited from the evolution of provisions made in 2010. Attributable profit was 4.4% higher.

Attributable profit in the UK was 54.4% lower than in the first nine months of 2010 in sterling, impacted by the provision for PPI. Excluding this impact, attributable profit was 3.6% lower, as it was hit by the negative impact of regulatory changes, which were almost offset by flat costs and lower needs for provisions.

INCOME STATEMENT AND BUSINESS VOLUMES SECONDARY SEGMENTS
Million euros

	Operating						Retail						Global						Asset Management
	business areas						Banking						Wholesale banking						and Insurance
	9M’11			Var (%)			9M’11			Var (%)			9M’11			Var (%)			9M’11			Var (%)
INCOME STATEMENT
Net interest income		24,530			5.4			22,486			5.1			1,825			6.1			220			46.7
Net fees		8,028			9.6			6,797			12.6			943			(2.4	)		288			(9.2	)
Gains (losses) on financial transactions		1,648			(22.1	)		968			(0.9	)		680			(38.4	)		(1	)		—
Other operating income (1)		218			(1.0	)		(327	)		86.3			187			76.0			358			23.7
Gross income		34,424			4.6			29,924			6.0			3,635			(6.7	)		865			9.4
Operating expenses		(14,070	)		9.3			(12,583	)		9.2			(1,230	)		11.4			(258	)		8.0
General administrative expenses		(12,586	)		8.9			(11,231	)		8.5			(1,124	)		12.7			(231	)		7.3
Personnel		(7,447	)		11.1			(6,585	)		11.1			(733	)		11.9			(129	)		7.1
Other general administrative expenses		(5,139	)		5.8			(4,646	)		5.1			(391	)		14.3			(103	)		7.5
Depreciation and amortisation		(1,484	)		13.5			(1,352	)		14.8			(106	)		(0.7	)		(26	)		14.8
Net operating income		20,354			1.5			17,341			3.8			2,405			(13.9	)		608			10.0
Net loan-loss provisions		(7,817	)		0.6			(7,687	)		(1.0	)		(130	)		—			0			—
Other income		(2,123	)		170.0			(2,036	)		170.3			(44	)		142.3			(43	)		188.2
Profit before taxes		10,413			(9.5	)		7,618			(7.0	)		2,231			(19.6	)		564			5.1
Tax on profit		(2,641	)		(5.3	)		(1,852	)		(2.8	)		(593	)		(19.6	)		(196	)		34.6
Profit from continuing operations		7,772			(10.8	)		5,766			(8.2	)		1,638			(19.6	)		369			(5.9	)
Net profit from discontinued operations		(3	)		(57.0	)		(3	)		(57.0	)		—			—			—			—
Consolidated profit		7,770			(10.7	)		5,763			(8.2	)		1,638			(19.6	)		369			(5.9	)
Minority interests		650			(9.7	)		433			(10.9	)		176			(7.4	)		41			(6.0	)
Attributable profit to the Group		7,120			(10.8	)		5,330			(7.9	)		1,462			(20.9	)		328			(5.9	)
BUSINESS VOLUMES
Total assets		1,207,333			(1.6	)		875,473			(1.9	)		296,818			(1.8	)		35,041			5.9
Customer loans		731,808			2.5			656,400			2.0			74,960			7.3			448			(9.6	)
Customer deposits		607,930			3.6			521,572			3.2			80,869			3.5			5,489			59.1

(1). - Including dividends, income from equity-accounted method and other operating income/expenses

50 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY SECONDARY SEGMENTS

RETAIL BANKING. INCOME STATEMENT
Million euros

	Gross					Net operating					Attributable
	income					income					profit to the Group
	9M’11		Var (%)			9M’11		Var (%)			9M’11		Var (%)
Continental Europe		10,212		7.6			5,955		4.2			2,023		4.4
o/w: Spain		5,441		(3.2	)		2,889		(5.0	)		788		(20.7	)
Portugal		606		(20.4	)		240		(38.2	)		78		(71.9	)
United Kingdom		3,904		(8.8	)		2,184		(13.2	)		556		(55.1	)
Latin America		14,252		10.4			8,343		9.7			2,381		2.0
o/w: Brazil		10,177		13.1			6,114		13.7			1,167		(11.6	)
Mexico		1,527		6.3			895		6.2			586		86.5
Chile		1,306		2.2			764		(4.5	)		323		(10.8	)
Sovereign		1,556		(0.2	)		860		(1.2	)		370		31.8
Total Retail Banking		29,924		6.0			17,341		3.8			5,330		(7.9	)

Retail banking revenues in Latin America continued to grow and also costs, compatible with business development. Net operating income was 8.9% higher, excluding the exchange rate impact.

Attributable profit, after provisions, other impairment losses and a higher tax charge, increased 2.4% over the same period of 2010.

Global Private Banking includes institutions that specialise in financial advice and asset management for high-income clients (Banco Banif in Spain, Santander Private Banking in the UK, Latin America and Italy), as well as the units of domestic private banking in Portugal and Latin America, jointly managed with local retail banks.

The division continued to install and adapt its common business model, commercial processes of advice, differentiated management of customers, personnel training, standardisation of investment strategies and discretional management and unification of products.

IT platforms for management of clients continued to be adapted so that it will be the same for all units. This platform is currently operating in Spain, Italy and Mexico, and is being installed in Brazil.

All the stock markets in which we operate fell in the first nine months. Despite this, however, the total volume of managed assets performed positively, the fruit of commercial efforts. Of note was the capturing of new business by the Latin American units, especially Brazil. Business grew in Italy because of the commercial activity as well as the acquisition of Banca Privada MeliorBanca. The volume of managed customer funds at the end of September amounted to EUR 100,000 million, 2% more than in December 2010.

Profit before tax was 11.2% higher year-on-year at EUR 292 million, confirming the change of trend seen in the second quarter.

This was largely due to the rise in net interest income, controlled costs and reduced needs for provisions. Attributable profit was EUR 227 million, 6.9% higher, impacted by greater tax pressure.

The best performance over the third quarter of 2010 came from Banif and Latin America, both domestic private banks as well as International Private Banking. Of note in Europe was the growth in volumes and the better product mix (discretionary management portfolios) and value-added products, as well lower net interest income due to the higher cost of funds.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 51

INFORMATION BY SECONDARY SEGMENTS

GLOBAL WHOLESALE BANKING

• Earnings backed by client revenues (87% of total gross income).

• Business affected in the third quarter by weakness and tensions in markets, particularly in Europe.

• Impact on costs of investments which are still in the first phases of maturity.

• Attributable profit was 20.9% lower year-on-year.

• Rigorous management of risk, liquidity and capital.

Santander Global Banking & Markets posted an attributable profit of EUR 1,462 million in the first nine months, 20.9% lower than in the same period of 2010. The third quarter saw even weaker markets than in the spring, due to sovereign debt tensions in Europe, and their impact on revenues, particularly non-client ones, caused profit to fall.

This area contributed 11% of gross income and 19% of operating areas’ total attributable profit.

Strategy

Santander Global Banking & Markets continued to maintain the main drivers of its business model: client-centred, integral focus of business (global reach and interconnection with local units), rigorous management of risk and profitable use of capital and liquidity.

In order to strengthen the positions reached in core markets and businesses and continue the growth path of the previous years, the area launched in 2010 a series of projects to bolster the operational capacities and distribution of basic treasury products, with a special focus on forex and fixed income businesses. These projects continued to be developed, through investment in resources and additional capacities.

This investment effort is already showing its first fruits in initiatives such as the distribution of fixed income products in the corporate and mid-corp segments in Europe, although progress slowed in the last two quarters, because of the market situation. The generation of additional revenues and strict management of a recurrent cost base that has been streamlined are enabling the area to absorb these investments and register an efficiency ratio of 33.8% that remains a reference for Santander’s peers.

Results and activity

Gains on financial transactions were lower, and costs and provisions higher and thus attributable profit was 20.9% lower year-on-year.

Gross income fell 6.7%, very much impacted by the lower gains on financial transactions of the last two quarters, the lowest of the last three years. Basic revenues increased 3.0% year-on-year, driven by net interest income (+6.1%), which reflected the adjustment of spreads to the new environment. Fee income dropped 2.4%, following the brake on those generated by market-related activities.

Operating expenses (+11.4% y-o-y) reflected the investment in equipment and technology. Net operating income was 13.9% lower at EUR 2,405 million. Provisions were higher, partly because of the lower release of generic provisions. As a result, attributable profit fell 20.9%.

The results were underscored by strong and diversified client revenues (87% of total gross income and notably stable, although somewhat changed in the third quarter). Client revenues in the first nine months were 5.1% lower than in the same period of 2010, when they were particularly high because of certain operations and the positive impact on the books of high volatility in some markets.

Stable generation of clients’ revenues in Latin America, despite the greater pressures of disintermediation, and strong rise from a low base at Sovereign, which is progressing toward reaching its natural share of corporate business. Greater weakness in Europe, particularly Spain (-14%) and the UK (-15%), hit by tensions and falls in markets in the last quarters.

The revenues generated by clients in the Global Relation Model, which give the area great stability, were stronger. They were 0.1% lower and already account for more than two-thirds of total client revenues.

The performance of the business areas and their contribution to revenue generation was as follows:

Global Transaction Banking

This area, which includes cash management, trade finance, basic financing and custody, increased its client revenues 4% year-on-year.

Of note were cash management revenues, which grew 17%, with double-digit rises in all countries. The larger contributions from were Brazil, Chile and Mexico.

Custody and settlement registered solid growth (+7%), backed by Latin America and Spain’s positive contribution.

Growth in basic financing (+5%) was more moderate in a context of greater disintermediation, containment of risk-weigthed assets and management of spreads.

Trade finance dropped 8% after the high levels reached in 2010 in Latin America, particularly in Brazil. Europe’s good results did not offset the decline in the large Latin American countries.

Corporate Finance

This area (mergers and acquisitions) increased its client revenues 23% year-on-year from a small base, spurred by the growing contribution of business in Spain and Brazil.

52 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY SECONDARY SEGMENTS

Notable operations in the third quarter included the acquisition by Schneider Electric of the 40% of Telvent owned by Abengoa, for $2,000 million. Santander was the buyer’s financial adviser.

Credit Markets

Credit Markets, which include origination and distribution of corporate loans or structured finance, bond origination and securitisation teams and asset and capital structuring, repeated its client revenues. The growth in the US and Latin America was offset by declines in the UK after the exceptional operations in 2010.

In loans, Santander maintained its reference position in Europe and Latin America. Of note was the participation in the $12,500 million loan for Sab Miller to finance the takeover of the Australian beer company Fosters. Santander was the bookrunner and mandated lead arranger. Of note in Latin America was the loan for Grupo Suramericana to acquire ING’s assets in the region.

The volume of bond issues was affected by the market situation, particularly in Europe. The evolution was better in Latin America, where Santander played a notable role in placing sovereign bonds of Brazil and for Pemex, backed by our extensive geographic presence and our experience and capacity to attract issuers to the Latin American cross-border market.

Also noteworthy was the second Project Bond of a Brazilian company, and the second loan structured by Santander ($700 million at 7 years) for Queiroz Galvao which repaid the two project finance loans used to build oil drilling ships and their subsequent leasing to Petrobras.

Asset and capital structuring continued to increase its portfolio of clients in Europe, Latin America and the US, which produced strong growth in revenues and a positive contribution from all countries.

Rates

This area, which restructured its businesses into three activities (fixed income sales, fixed income flow and FX) reflects in client revenues (-4% at September) the weakness of the sovereign debt markets and the impact on management of books, which could not be offset by a better evolution of sales.

Fixed income sales (distribution of non-liquid interest rate and credit derivatives to institutional investors, large corporations and the retail segment via the Group’s networks), continued to grow in Europe and Latin America, particularly Brazil, because of greater customer activity following the sharp fall in the yield curve. Of note was the faster pace of growth to institutional investors in Europe and the UK, along with the good evolution of corporates and mid-corp.

Revenues from fixed income flow activity (distribution of corporate and government bonds and liquid interest rate, credit and inflation derivatives) was sharply down due to the impact on the markets of the European Union’s sovereign debt crisis.

Lastly, FX (trading activities and hedging of exchange rates and short-term money markets for the Group’s wholesale and retail clients) maintained sustained growth, firmly backed by the UK and Latin America, particularly Brazil. Better performance of sales globally and good performance of the books in Latin America in an environment of high volatility.

Equities

Growth in revenues from global equities (activities related to the equity markets) slowed down in the third quarter to 37% year-on-year, partly due to the large revenues from significant operations in 2010, which were not offset by transactions this year.

The lower volumes and high levels of volatility in the markets in the last few months reduced the sale of investment and hedging solutions, as well as the contribution to the income statement from management of books.

The volatility and uncertainty over the economic recovery delayed some primary operations, although some key operations in Latin America and Europe remained in the pipeline and are expected to materialise in the fourth quarter.

Lastly, there was a noteworthy increase in Santander’s activity in exchange traded derivatives as access provider to main markets worldwide, boosting revenues.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 53

INFORMATION BY SECONDARY SEGMENTS

ASSET MANAGEMENT AND INSURANCE

• Strong growth in total revenues as they rose 15% and accounted for 10% of the operating areas’ total.

• Mutual and pension funds: the better mix of products offset the fall in volumes.

• Insurance: faster pace in revenues in Brazil and Latin America and sustained recovery in Spain and in consumer business.

• Progress in the strategic alliance with Zurich to boost the insurance offer in Latin America.

Attributable profit was 5.9% lower in the first nine months at EUR 328 million (4% of the operating areas’ total).

Strategy

Santander Asset Management advanced in its development of a global business model based on the Group’s management capacities and the market knowledge of local fund managers. The push given to the multimanager team to manage funds of funds, as well as the creation of global teams to manage Latin American and European mandates, underlined the progress.

Santander Insurance also continued to build its global business model by launching units and businesses to respond to the needs of local networks and customers, while preserving a low risk profile model and one very efficient in its operations.

In Latin America, Santander signed a global agreement in July with the insurer Zurich to bolster business in the region. Under it, Zurich acquires 51% of the holding company which will group Santander’s insurers in Argentina, Brazil, Chile, Mexico and Uruguay, as well as a product distribution agreement in these countries.

At the close of this report, 51% of the holding was sold to Zurich and incorporated to it the companies in Brazil and Argentina, after obtaining authorisations from local supervisors and the European Union. Authorisations from the supervisors of insurance companies in Mexico, Chile and Uruguay were pending and are expected to be given during the fourth quarter.

Results

Gross income increased 9.4% year-on-year, spurred by revenues from insurance and the moderate rise in fee income from mutual funds. Costs continued to reflect investments in strategic projects but their growth eased (+8.0%). Net operating income increased 10.0% to EUR 608 million year-on-year, but as other income was negative and the tax charge was higher attributable profit was lower.

The area’s total revenues contributed to the Group including those recorded by the distribution networks amounted to EUR 3,403 million in the first nine months, 14.8% more than in the same period of 2010 and 10% of the operating areas’ total revenues. The total contribution (profit before tax plus fees paid to the networks) was EUR 3,093 million (+14.5%).

Asset management

The global area of Santander Asset Management posted an attributable profit of EUR 30 million and the total contribution (profit before tax and fees paid to the networks) was EUR 794 million, 4,2% less than in the first nine months of 2010. The decline was due to flat total revenues (EUR 958 million) and higher costs due to investments.

Stable revenues were due to an increase in the average commissions in the main markets from the better product mix and a faster decline in managed volumes in the third quarter. Total mutual and pension funds under management amounted to EUR 114,000 million, 8% less than in June 2011 (-4% since September 2010), affected by the loss of value of markets and the recent depreciation of Latin American currencies.

Volumes varied. They were weaker in developed countries because of the strong preference for deposits and liquidity, along with the markets’ impact on valuations. On the other hand, balances in Latin America were higher in local currencies, continuing the trend begun in 2009. The main developments by units and countries were as follows:

•	In traditional management of assets, there was a continued good performance of mutual fund business, despite the high uncertainty and volatility in the markets in the last quarter.
	In this segment, the Group manages EUR 111,000 million (2% less than in September 2010) in funds, investment companies and pension plans, of which close to 90% comes from four large markets (Brazil, the UK, Spain and Mexico).
	Brazil, the main market by volume, stepped up its growth in assets under management (+24% y-o-y in reales to EUR 41,000 million). Net sales and fees improved, partly because of the good reception given to new guaranteed products aimed at the retail segment.

54 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

INFORMATION BY SECONDARY SEGMENTS

	The UK’s retail balances at the end of September amounted to EUR 14,700 million (+8% y-o-y in sterling), strongly backed by growth in the multimanager funds of funds. The multimanager team in the UK received the award for Best Manager of the Year by Investment Week in the category of funds of funds and also registered the largest net capturing of the year for this type of product, according to Fundscape Pridham Report.
	In Spain, large net redemptions continued throughout the sector, reflecting the preference of banks for liquidity and with attractive offers for savers. In this environment, Santander Asset Management focused on mixed and guaranteed funds. Of note were the EUR 860 million captured by the range of Select funds and the capturing of the first institutional mandate of corporate fixed income outside Spain (in Germany).
	All of this helped to consolidate the Group as the market leader (16.8% market share, according to Inverco, and maintain assets under traditional management in Spain, including pension plans, at EUR 35,000 million (-19% y-o-y).
	Mexico benefited from the launch of new mixed and guaranteed funds and increased its volume 4% year-on-year to EUR 9,500 million and improved the mix of products.
	In the rest of markets, Chile’s volume dropped 5% year-on-year in pesos because of the push into deposits. In Portugal, the shift into deposits and the impact of markets accelerated the fall in mutual and pension funds (-35% year-on-year).
•	In non-traditional management (real estate, alternative management and private equity funds), Santander Asset Management continued to adjust its activity to the scant demand for these products.
	In the first quarter, Grupo Santander decided, for solely commercial reasons, to provide funds to Santander Banif Inmobiliario, by subscribing new units and granting a two-year liquidity guarantee in order to meet any outstanding redemption claims. This measure ended the suspension of redemptions and returned the fund to normal.
	Greater stability in alternative funds after the restructuring in previous years, and in the private equity segment, which is aimed at institutional clients who invest long term in unlisted companies.

Insurance

The global area of Santander Insurance posted an attributable profit in the first nine months of EUR 298 million, 4.8% more than in the same period of 2010. Higher revenues from the basic activities offset the rise in costs from greater investments.

Insurance business generated for the Group total revenues (including fee income paid to the commercial networks) of EUR 2,445 million (+21.9% y-o-y). The total contribution to profits (income before taxes of insurers and brokers plus fee income received by the networks) increased 22.8% to EUR 2,298 million.

The total volume of premium income increased 22% year-on-year due to the good evolution of protection insurance premiums (+19%) as well as the recovery in the distribution of savings insurance whose premium income rose 25% after falling in 2010.

Continental Europe‘s contribution increased 8% year-on-year, backed by the solid performance of Santander Consumer Finance and the recovery in Spain. Excluding consumer business, Spain increased its contribution by 10% due basically to the relaunch of savings-investment products and the competitiveness of protection products. Portugal’s contribution continued to decline (-23% y-o-y) because of the greater pressure from deposits, while the contribution of Poland (BZ WBK) is still small.

Santander Consumer Finance maintained its strong pace of selling, adjusted to each market, which enabled it to increase its total contribution by 12% year-on-year. The acceleration of the German market and the contribution of new entities offset the decline in some peripheral markets.

The UK’s total contribution rose 4% in sterling. The evolution in the third quarter was better against other products competing for savings.

Latin America increased its contribution 39% year-on-year, excluding the exchange rate impact. This clearly reflected the region’s high potential. The greater efficiency in selling via banking networks and other channels, together with the development of simple products independent of loans, pushed up the region’s activity and results.

Of note was Brazil, which contributed more than two-thirds of the region’s total (+43% y-o-y in reales). Mexico and Chile also grew strongly in local currency (+53% and +17%, respectively).

Sovereign, still installing its insurance model, continued to increase its total contribution (+18% in dollars y-o-y).

ASSET MANAGEMENT AND INSURANCE. INCOME STATEMENT
Million euros

	Gross					Net operating					Attributable
	income					income					profit to the Group
	9M’11		Var (%)			9M’11		Var (%)			9M’11		Var (%)
Mutual funds		203		1.9			82		(6.3	)		23		(58.6	)
Pension funds		17		(7.9	)		10		(15.9	)		7		(14.3	)
Insurance		645		12.6			516		13.8			298		4.8
Total Asset Management and Insurance		865		9.4			608		10.0			328		(5.9	)

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 55

CORPORATE GOVERNANCE

CORPORATE GOVERNANCE

Santander was ranked first among the category of banks and savings banks in the XIII ranking of the information transparency of annual reports and economic and financial information, drawn up by the economic weekly El Nuevo Lunes. Its score was 7.3 out of 10.

For the third time in the last five years, the Bank stood out as the financial institution that provides the best information, according to the analysts interviewed.

The Bank’s results in the analysis conducted every year in order to select the companies forming the Dow Jones Sustainability Index (DJSI), one of the main international indices of socially responsible investment, were announced in September. The index’s composition is tracked by a large number of institutional investors in Europe and the US.

Once again, and since 2000, the Bank remained in this competitive index, comprising a small number of companies. The DJSI assesses companies in three large spheres: economic, environmental and social, combining general and specific criteria of the sector in which they operate.

Santander achieved a total score of 79% and occupied leading positions in anti-crime policy/measures; codes of conduct/compliance/corruption and bribery and corporate governance, with scores of 98%, 82% and 72%, respectively, which compare very well with the sector’s averages (70%, 67% and 69%, respectively).

The score of 79% was higher than in 2010 (78%) and is well above that of the average for banks of 53%.

56 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

SIGNIFICANT EVENTS IN THE QUARTER AND SUBSEQUENT ONES

SIGNIFICANT EVENTS IN THE QUARTER AND SUBSEQUENT ONES

Agreement with Zurich Financial Services: update

In Latin America, Santander signed a global agreement in July with the insurer Zurich to bolster business in the region. Under it, Zurich acquires 51% of the holding company which will group Santander’s insurers in Argentina, Brazil, Chile, Mexico and Uruguay, as well as a product distribution agreement in these countries.

At the close of this report, 51% of the holding was sold to Zurich and incorporated to it the companies in Brazil and Argentina, after obtaining authorisations from local supervisors and the European Union. Authorisations from the supervisors of insurance companies in Mexico, Chile and Uruguay were pending and are expected to be given during the fourth quarter.

The capital gains obtained from this transaction (around EUR 750 million net of tax) will be used to strengthned the Bank’s balance sheet.

Santander incorporates new partners in Santander Consumer USA

Santander Consumer USA will increase its capital by approximately $1.15 billion in order to enable new partners to enter. Of this amount, $1 billion will be disbursed by Sponsor Auto Finance Holdings Series, an entity held by funds controlled by Warburg Pincus, Kohlberg Kravis Roberts and Centerbridge Partners, and Dundon DFS, approximately, $150 million.

The transaction values the company at $4 billion. Following this transaction, Santander will realize a capital gain of approximately $1 billion, which will be fully allocated to reinforce the Group’s balance sheet.

Following the capital increase, Grupo Santander will have a 65% stake in Santander Consumer USA; Kohlberg Kravis Roberts, Warburg Pincus and Centerbridge Partners (through Sponsor Auto Finance Holdings Series) 25%; and Dundon DFS 10%.

This transaction, which is expected to be closed before December 31, 2011, is subject to obtaining the relevant regulatory approvals.

Strategy

A meeting with analysts and investors was held in London on September 29 and 30 at which Grupo Santander’s current situation and outlook were examined. The documentation provided is available at www.santander.com.

Dividends

The general shareholders’ meeting in June 2011 gave its approval, following the wide acceptance in 2010 and 2009 of the Santander Dividendo Elección programme (scrip dividend), to continuing this option in November 2011 for the second interim dividend payment in cash or new shares. Furthermore, depending on the level of demand and market conditions, this option could also be offered for the third interim dividend at the usual payment date in February 2012.

On August 1, the first interim dividend charged to 2011’s earnings of EUR 0.135 gross per share was paid, the same amount as for this dividend in 2010.

In accordance with the scrip dividend programme, shareholders can choose to receive the amount equivalent to the second interim dividend in cash or in shares. Every shareholder has a free allotment right of new shares for each share owned. Shareholders can sell the rights to the Bank between October 17 and 31 at a set price (EUR 0.126 gross per right), on the stock market between October 17 and 31 at the market price, or receive new shares in the proportion of one new share for every 49 rights, and in the last two cases without withholding tax*.

In order to meet this, there will be a rights issue for a maximum of EUR 86,137,739, represented by 172,275,478 shares. The number of new shares to be issued, and thus the amount of the capital increase, will depend on the number of shareholders who opt to sell their free allotment rights to the Bank at a set price.

Shareholders are due to receive on November 3 the amount in cash if they opted to sell their rights to the Bank, and on November 9 the new shares those who chose this option.

Assicurazioni Generali S.p.A. resignes to its position as director

The board of directors of Banco Santander, S.A. resolved on its meeting held on 24 October, to leave record of the resignation of Assicurazioni Generali S.p.A. from its position as director of the Bank, which is effective from that date.

(*) The options, maturities and procedures indicated can present special features for shareholders holding Santander shares in the various foreign stock markets where the Bank is listed.

     JANUARY — SEPTEMBER FINANCIAL REPORT 2011 57

CORPORATE SOCIAL RESPONSIBILITY

CORPORATE SOCIAL RESPONSIBILITY

Grupo Santander continued in the third quarter to develop new initiatives within its commitment to corporate social responsibility. The main ones were:

Presence in sustainability indices

As described in the section on corporate governance, Santander remained among the best in the DJSI index (both in the World Index as well as the Stoxx, after obtaining excellent scores in the three spheres analysed: economic, social and environmental.

Santander Universities

Banco Santander’s alliance with universities, the main focus of its corporate social responsibility policy, continued to develop new initiatives such as signing a new cooperation agreement with the University of Birmingham to grant scholarships for travel and research. The agreement also includes academic prizes and fostering entrepreneurial projects. The number of British universities supported by Banco Santander amount to 50.

Emilio Botín presided over the ceremony awarding the Santander Universities Business Initiative Prizes in the UK, at which he announced the Bank would grant 10,000 scholarships and aid over the next four years.

Banco Santander sponsored the seventh edition of the summer courses of the Madrid Polytechnic University at the Real Sitio de San Ildefonso-La Granja. This meeting brought together more than 1,000 students and close to 300 speakers. Researchers and experts reflected on the challenges raised by new scientific advances.

Social and cultural actions

In social actions, Banco Santander assigned in September EUR 500,000 to the projects launched by Cáritas España and the Red Cross to combat drought and famine in the Horn of Africa. Santander also launched a campaign to capture funds which saw customers and employees depositing EUR 300,000 in the accounts of various NGOs supporting the same causes.

Banco Santander, the main sponsor of the Copa América football championship, presented in Buenos Aires the “Goles Solidarios Santander” initiative under the slogan, “Tu pasión, nuestro compromiso.” Santander donated $1,000 for each goal scored. A total of EUR 100,000 was raised for UNICEF projects in support of children’s education in the region.

Banco Santander signed a cooperation agreement with the NGO platform of Acción Social in Spain under which it will help to finance 28 organisations launched by young entrepreneurs. The agreement covers financial services in preferential conditions for the Platform and its NGOs, among them, the handling via Banco Santander of ICO credit lines also for private institutions.

The environment

Banco Santander was included in the ranking of Interbrand’s Best Global Green Brands which measure the 50 best companies in the World on the basis of their environmental performance. Two of the most recognised projects in this ranking were Santander’s $149 million financing of a renewable energy project in Mexico and the Papa-Pilhas programme in Brazil under which branches collected 172 tonnes of batteries in 2010. Santander was ranked 40th, the first bank and the only Spanish company in the ranking.

In line with is commitment to the environment, the renewable energy team of corporate banking at Santander UK signed a “green electricity” agreement as part of its new global action plan in the environmental sphere in order to support the development of renewable energy in the UK. This operation will enable a loan of £11.5 million to be made to the Green Home Company to install and maintain close to 1,500 solar panels on the roofs of homes in the southeast of England.

Banco Santander Foundation

The Foundation continued to support projects closely related to the arts, scientific research and education.

It cooperated with the summer courses of the International Menéndez Pelayo University in the cycle of conferences “Authors and their work”, at which artists, authors, philosophers, architects and filmmakers were spoke.

The Foundation and the International Oncology Research Centre (CNIO) signed a cooperation agreement to develop a postdoctoral programme for British scientists. The programme is also supported by the UK Science and Innovation Network and will enable the CNIO, one of the five main cancer research centres in the world, to receive young researchers from the UK, one of the main countries in biomedical research.

Recognitions

Banco Santander Spain was recognised as a gender equality company because of its striving for gender diversity and policies promoting equality of treatment and opportunity. The Bank’s certification as a responsible family company (since 2008) was also renewed, thanks to its pioneering initiatives in the work-life balance.

58 JANUARY — SEPTEMBER FINANCIAL REPORT 2011     

Investor Relations Ciudad Grupo Santander Edificio Pereda, 1st floor Avda de Cantabria, s/n 28660 Boadilla del Monte Madrid (Spain) Tel: 34 (91) 259 65 14 / 34 (91) 259 65 20 Fax: 34 (91) 257 02 45 e-mail: investor@gruposantander.com Legal Head Office: Paseo Pereda. 9-12. Santander (Spain) Teléfono: 34 (942) 20 61 00 Operational Head Office: Ciudad Grupo Santander Avda. de Cantabria, s/n 28660 Boadilla del Monte. Madrid (Spain)

Key consolidated data

					Variation
	9M ’11		9M ’10		Amount			%			2010
Balance sheet (million euros)
Total assets		1,250,476		1,235,712		14,764			1.2			1,217,501
Net customer loans		734,302		715,642		18,661			2.6			724,154
Customer deposits		619,911		601,293		18,618			3.1			616,376
Customer funds under management		976,598		984,195		(7,597	)		(0.8	)		985,269
Shareholders’ equity		79,144		73,753		5,391			7.3			75,273
Total managed funds		1,382,920		1,375,136		7,783			0.6			1,362,289
Income statement (million euros)
Net interest income		22,853		21,896		957			4.4			29,224
Gross income		33,254		31,436		1,818			5.8			42,049
Net operating income		18,529		17,938		591			3.3			23,853
Profit from continuing operations		5,977		6,817		(841	)		(12.3	)		9,129
Attributable profit to the Group		5,303		6,080		(777	)		(12.8	)		8,181
EPS, profitability and efficiency (%)
EPS (euro)		0.5981		0.7010		(0.1030	)		(14.7	)		0.9418
Diluted EPS (euro)		0.5929		0.6949		(0.1021	)		(14.7	)		0.9356
ROE		9.47		11.75								11.80
ROTE		14.32		18.04								18.11
ROA		0.65		0.77								0.76
RoRWA		1.37		1.55								1.55
Efficiency ratio (with amortisations)		44.3		42.9								43.3
BIS II ratios and NPL ratios (%)
Core capital		9.42		8.47								8.80
Tier I		10.74		9.72								10.02
BIS ratio		13.24		12.98								13.11
NPL ratio		3.86		3.42								3.55
NPL coverage		66		75								73
Market capitalisation and shares
Shares outstanding (millions at period-end)		8,440		8,229		211			2.6			8,329
Share price (euros)		6.224		9.317		(3.093	)		(33.2	)		7.928
Market capitalisation (million euros)		52,532		76,668		(24,136	)		(31.5	)		66,033
Book value (euro)		8.91		8.49								8.58
Price / Book value (X)		0.70		1.10								0.92
P/E ratio (X)		7.81		9.97								8.42
Other data
Number of shareholders		3,263,997		3,146,531		117,466			3.7			3,202,324
Number of employees		191,350		176,471		14,879			8.4			178,869
Continental Europe		63,934		54,551		9,383			17.2			54,518
o/w: Spain		33,214		33,536		(322	)		(1.0	)		33,694
United Kingdom		26,034		23,109		2,925			12.7			23,649
Latin America		90,106		87,765		2,341			2.7			89,526
Sovereign		8,950		8,539		411			4.8			8,647
Corporate Activities		2,326		2,507		(181	)		(7.2	)		2,529
Number of branches		14,709		13,907		802			5.8			14,082
Continental Europe		6,636		6,075		561			9.2			6,063
o/w: Spain		4,785		4,856		(71	)		(1.5	)		4,848
United Kingdom		1,386		1,328		58			4.4			1,416
Latin America		5,964		5,784		180			3.1			5,882
Sovereign		723		720		3			0.4			721

Note: The financial information in this report has not been audited, but it was approved by the Board of Directors at its meeting on October, 24 2011, following a favourable report from the Audit and Compliance Committee on October, 19 2011. The Committee verified that the information for the quarter was based on the same principles and practices as those used to draw up the annual financial statements.

Income statement

Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Net interest income		22,853			21,896			957			4.4
Dividends		294			251			43			17.1
Income from equity-accounted method		16			13			3			26.0
Net fees		8,017			7,290			728			10.0
Gains (losses) on financial transactions		2,018			1,890			128			6.8
Other operating income/expenses		56			97			(41	)		(42.2	)
Gross income		33,254			31,436			1,818			5.8
Operating expenses		(14,725	)		(13,498	)		(1,227	)		9.1
General administrative expenses		(13,150	)		(12,088	)		(1,061	)		8.8
Personnel		(7,682	)		(6,908	)		(774	)		11.2
Other general administrative expenses		(5,468	)		(5,180	)		(287	)		5.5
Depreciation and amortisation		(1,575	)		(1,409	)		(166	)		11.8
Net operating income		18,529			17,938			591			3.3
Net loan-loss provisions		(7,777	)		(7,854	)		78			(1.0	)
Impairment losses on other assets		(184	)		(161	)		(23	)		14.0
Other income		(2,290	)		(1,057	)		(1,234	)		116.7
Profit before taxes		8,278			8,866			(588	)		(6.6	)
Tax on profit		(2,302	)		(2,049	)		(253	)		12.3
Profit from continuing operations		5,977			6,817			(841	)		(12.3	)
Net profit from discontinued operations		(21	)		(17	)		(4	)		25.7
Consolidated profit		5,955			6,800			(845	)		(12.4	)
Minority interests		652			720			(68	)		(9.5	)
Attributable profit to the Group		5,303			6,080			(777	)		(12.8	)
EPS (euros)		0.5981			0.7010			(0.1030	)		(14.6881	)
Diluted EPS (euros)		0.5929			0.6949			(0.1021	)		(14.6858	)
Pro memoria:
Average total assets		1,224,643			1,180,196			44,447			3.8
Average shareholders’ equity		74,687			68,990			5,697			8.3

Quarterly

Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Net interest income		7,122			7,378			7,396			7,329			7,514			7,638			7,700
Dividends		47			144			60			111			40			193			60
Income from equity-accounted method		3			5			5			4			5			5			6
Net fees		2,326			2,483			2,481			2,445			2,595			2,729			2,694
Gains (losses) on financial transactions		724			567			599			715			657			722			639
Other operating income/expenses		38			38			22			9			41			(2	)		18
Gross income		10,260			10,614			10,563			10,613			10,852			11,285			11,117
Operating expenses		(4,263	)		(4,548	)		(4,687	)		(4,698	)		(4,824	)		(4,908	)		(4,994	)
General administrative expenses		(3,812	)		(4,070	)		(4,206	)		(4,168	)		(4,314	)		(4,380	)		(4,456	)
Personnel		(2,182	)		(2,317	)		(2,408	)		(2,421	)		(2,521	)		(2,550	)		(2,611	)
Other general administrative expenses		(1,629	)		(1,753	)		(1,798	)		(1,746	)		(1,792	)		(1,830	)		(1,845	)
Depreciation and amortisation		(451	)		(478	)		(481	)		(531	)		(510	)		(528	)		(538	)
Net operating income		5,997			6,066			5,876			5,915			6,029			6,377			6,123
Net loan-loss provisions		(2,436	)		(2,483	)		(2,935	)		(2,404	)		(2,188	)		(2,684	)		(2,906	)
Impairment losses on other assets		(57	)		(63	)		(41	)		(310	)		(48	)		(52	)		(84	)
Other income		(331	)		(362	)		(364	)		(16	)		(550	)		(1,379	)		(361	)
Profit before taxes		3,173			3,158			2,535			3,186			3,243			2,262			2,773
Tax on profit		(734	)		(680	)		(634	)		(874	)		(888	)		(636	)		(778	)
Profit from continuing operations		2,439			2,477			1,901			2,311			2,355			1,627			1,995
Net profit from discontinued operations		(12	)		(1	)		(4	)		(10	)		(6	)		(0	)		(15	)
Consolidated profit		2,427			2,476			1,897			2,301			2,349			1,626			1,980
Minority interests		212			246			262			201			241			234			177
Attributable profit to the Group		2,215			2,230			1,635			2,101			2,108			1,393			1,803
EPS (euros)		0.2553			0.2574			0.1884			0.2408			0.2382			0.1569			0.2030
Diluted EPS (euros)		0.2537			0.2558			0.1854			0.2406			0.2364			0.1558			0.2007

Exchange rates: 1 euro / currency parity

	Average (income statement)				Period-end (balance sheet)
	9M ’11		9M ’10		30.09.11		31.12.10		30.09.10
US$		1.4055		1.3113		1.3503		1.3362		1.3648
Pound sterling		0.8711		0.8563		0.8667		0.8608		0.8600
Brazilian real		2.2928		2.3347		2.5067		2.2177		2.3201
New Mexican peso		16.9089		16.6655		18.5936		16.5475		17.1258
Chilean peso		666.5810		682.2170		703.7088		625.2748		661.3138
Argentine peso		5.7494		5.1068		5.6773		5.3074		5.4073
Polish zloty		4.0163		4.0023		4.4050		3.9750		3.9847

Net fees
Million euros

					Variation
	9M ’11		9M ’10		Amount			%
Fees from services		4,678		4,205		473			11.3
Mutual & pension funds		945		951		(6	)		(0.6	)
Securities and custody		508		587		(79	)		(13.5	)
Insurance		1,886		1,546		340			22.0
Net fee income		8,017		7,290		728			10.0

Operating expenses
Million euros

					Variation
	9M ’11		9M ’10		Amount			%
Personnel expenses		7,682		6,908		774			11.2
General expenses		5,468		5,180		287			5.5
Information technology		670		633		36			5.7
Communications		510		491		19			3.9
Advertising		494		467		27			5.7
Buildings and premises		1,230		1,162		68			5.9
Printed and office material		126		140		(13	)		(9.5	)
Taxes (other than profit tax)		294		269		25			9.3
Other expenses		2,144		2,018		126			6.2
Personnel and general expenses		13,150		12,088		1,061			8.8
Depreciation and amortisation		1,575		1,409		166			11.8
Total operating expenses		14,725		13,498		1,227			9.1

Net loan-loss provisions
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Non performing loans		9,017			8,700			317			3.6
Country-risk		5			(2	)		7			—
Recovery of written-off assets		(1,245	)		(844	)		(401	)		47.6
Total		7,777			7,854			(78	)		(1.0	)

Balance sheet
Million euros

							Variation
	30.09.11			30.09.10			Amount			%			31.12.10
Assets
Cash on hand and deposits at central banks		84,050			69,183			14,867			21.5			77,785
Trading portfolio		191,440			180,566			10,874			6.0			156,762
Debt securities		60,033			58,085			1,948			3.4			57,871
Customer loans		1,973			612			1,361			222.4			755
Equities		6,432			7,746			(1,314	)		(17.0	)		8,850
Trading derivatives		102,217			93,855			8,362			8.9			73,069
Deposits from credit institutions		20,785			20,267			518			2.6			16,216
Other financial assets at fair value		27,875			41,611			(13,736	)		(33.0	)		39,480
Customer loans		11,039			9,446			1,593			16.9			7,777
Other (deposits at credit institutions, debt securities and equities)		16,836			32,166			(15,330	)		(47.7	)		31,703
Available-for-sale financial assets		79,410			83,191			(3,781	)		(4.5	)		86,235
Debt securities		73,875			76,477			(2,602	)		(3.4	)		79,689
Equities		5,535			6,714			(1,179	)		(17.6	)		6,546
Loans		772,144			773,021			(877	)		(0.1	)		768,858
Deposits at credit institutions		43,778			58,045			(14,267	)		(24.6	)		44,808
Customer loans		721,291			705,584			15,707			2.2			715,621
Debt securities		7,075			9,392			(2,317	)		(24.7	)		8,429
Investments		1,212			283			928			327.5			273
Intangible assets and property and equipment		17,102			12,969			4,133			31.9			14,584
Goodwill		25,914			23,928			1,986			8.3			24,622
Other		51,330			50,959			370			0.7			48,901
Total assets		1,250,476			1,235,712			14,764			1.2			1,217,501
Liabilities and shareholders’ equity
Trading portfolio		168,751			157,895			10,856			6.9			136,772
Customer deposits		15,368			5,567			9,801			176.1			7,849
Marketable debt securities		1,507			380			1,127			296.8			365
Trading derivatives		101,557			94,292			7,265			7.7			75,279
Other		50,318			57,656			(7,338	)		(12.7	)		53,279
Other financial liabilities at fair value		66,940			48,942			17,997			36.8			51,020
Customer deposits		43,415			29,074			14,341			49.3			27,142
Marketable debt securities		8,432			7,918			514			6.5			4,278
Due to central banks and credit institutions		15,093			11,951			3,142			26.3			19,600
Financial liabilities at amortized cost		887,244			902,505			(15,261	)		(1.7	)		898,969
Due to central banks and credit institutions		93,435			82,468			10,968			13.3			79,537
Customer deposits		561,128			566,653			(5,524	)		(1.0	)		581,385
Marketable debt securities		187,750			200,138			(12,388	)		(6.2	)		188,229
Subordinated debt		25,848			32,287			(6,440	)		(19.9	)		30,475
Other financial liabilities		19,082			20,959			(1,877	)		(9.0	)		19,343
Insurance liabilities		9,894			6,527			3,367			51.6			10,449
Provisions		15,198			16,756			(1,558	)		(9.3	)		15,660
Other liability accounts		24,160			26,827			(2,667	)		(9.9	)		23,717
Total liabilities		1,172,187			1,159,453			12,734			1.1			1,136,586
Shareholders’ equity		79,144			73,753			5,391			7.3			77,334
Capital stock		4,220			4,114			106			2.6			4,165
Reserves		70,762			64,672			6,091			9.4			66,258
Attributable profit to the Group		5,303			6,080			(777	)		(12.8	)		8,181
Less: dividends		(1,141	)		(1,113	)		(29	)		2.6			(1,270	)
Equity adjustments by valuation		(6,519	)		(2,866	)		(3,653	)		127.4			(2,315	)
Minority interests		5,664			5,372			292			5.4			5,896
Total equity		78,289			76,259			2,030			2.7			80,914
Total liabilities and equity		1,250,476			1,235,712			14,764			1.2			1,217,501

Balance sheet
Million euros

	31.03.10			30.06.10			30.09.10			31.12.10			31.03.11			30.06.11			30.09.11
Assets
Cash on hand and deposits at central banks		48,394			61,056			69,183			77,785			86,006			90,003			84,050
Trading portfolio		146,999			162,540			180,566			156,762			148,138			164,301			191,440
Debt securities		58,256			65,521			58,085			57,871			55,426			69,164			60,033
Customer loans		1,946			1,061			612			755			2,080			694			1,973
Equities		8,761			6,707			7,746			8,850			8,146			8,316			6,432
Trading derivatives		71,637			85,357			93,855			73,069			62,509			68,494			102,217
Deposits from credit institutions		6,399			3,895			20,267			16,216			19,976			17,633			20,785
Other financial assets at fair value		34,311			34,029			41,611			39,480			41,907			30,986			27,875
Customer loans		8,369			12,201			9,446			7,777			6,892			8,574			11,039
Other (deposits at credit institutions, debt securities and equities)		25,942			21,827			32,166			31,703			35,014			22,412			16,836
Available-for-sale financial assets		87,587			85,908			83,191			86,235			85,125			90,476			79,410
Debt securities		80,189			78,360			76,477			79,689			78,741			84,137			73,875
Equities		7,398			7,547			6,714			6,546			6,384			6,339			5,535
Loans		742,569			787,512			773,021			768,858			760,084			764,588			772,144
Deposits at credit institutions		55,809			61,514			58,045			44,808			47,414			42,593			43,778
Customer loans		672,834			714,619			705,584			715,621			704,898			714,701			721,291
Debt securities		13,926			11,378			9,392			8,429			7,772			7,294			7,075
Investments		167			200			283			273			275			293			1,212
Intangible assets and property and equipment		12,000			12,837			12,969			14,584			17,041			17,566			17,102
Goodwill		23,602			25,345			23,928			24,622			23,856			26,527			25,914
Other		46,732			50,597			50,959			48,901			46,132			47,168			51,330
Total assets		1,142,360			1,220,024			1,235,712			1,217,501			1,208,563			1,231,908			1,250,476
Liabilities and shareholders’ equity
Trading portfolio		117,807			139,091			157,895			136,772			130,191			131,909			168,751
Customer deposits		4,116			4,081			5,567			7,849			7,838			13,133			15,368
Marketable debt securities		460			512			380			365			1,207			2,214			1,507
Trading derivatives		68,427			82,940			94,292			75,279			63,746			68,663			101,557
Other		44,804			51,557			57,656			53,279			57,400			47,900			50,318
Other financial liabilities at fair value		43,244			37,922			48,942			51,020			52,786			72,638			66,940
Customer deposits		17,316			23,691			29,074			27,142			30,836			39,115			43,415
Marketable debt securities		6,246			6,767			7,918			4,278			5,203			8,954			8,432
Deposits at credit institutions		19,682			7,464			11,951			19,600			16,747			24,570			15,093
Financial liabilities at amortized cost		850,157			911,636			902,505			898,969			898,476			898,769			887,244
Due to central banks and credit institutions		73,841			80,124			82,468			79,537			80,790			87,681			93,435
Customer deposits		515,596			567,527			566,653			581,385			582,100			572,166			561,128
Marketable debt securities		204,019			205,144			200,138			188,229			187,861			191,314			187,750
Subordinated debt		34,740			35,497			32,287			30,475			26,431			25,841			25,848
Other financial liabilities		21,961			23,343			20,959			19,343			21,293			21,767			19,082
Insurance liabilities		13,905			10,002			6,527			10,449			10,453			10,775			9,894
Provisions		17,906			16,942			16,756			15,660			15,142			16,040			15,198
Other liability accounts		23,709			26,014			26,827			23,717			21,762			22,113			24,160
Total liabilities		1,066,728			1,141,606			1,159,453			1,136,586			1,128,810			1,152,245			1,172,187
Shareholders’ equity		71,977			73,034			73,753			77,334			77,590			77,697			79,144
Capital stock		4,114			4,114			4,114			4,165			4,220			4,220			4,220
Reserves		69,769			65,587			64,672			66,258			74,592			71,117			70,762
Attributable profit to the Group		2,215			4,445			6,080			8,181			2,108			3,501			5,303
Less: dividends		(4,122	)		(1,113	)		(1,113	)		(1,270	)		(3,330	)		(1,141	)		(1,141	)
Equity adjustments by valuation		(1,992	)		(749	)		(2,866	)		(2,315	)		(3,813	)		(4,165	)		(6,519	)
Minority interests		5,647			6,133			5,372			5,896			5,976			6,131			5,664
Total equity		75,632			78,418			76,259			80,914			79,753			79,663			78,289
Total liabilities and equity		1,142,360			1,220,024			1,235,712			1,217,501			1,208,563			1,231,908			1,250,476

Customer loans
Million euros

					Variation
	30.09.11		30.09.10		Amount			%			31.12.10
Public sector		12,340		12,054		286			2.4			12,137
Other residents		205,225		217,421		(12,196	)		(5.6	)		217,497
Commercial bills		9,075		10,203		(1,128	)		(11.1	)		11,146
Secured loans		121,016		128,360		(7,344	)		(5.7	)		127,472
Other loans		75,135		78,858		(3,723	)		(4.7	)		78,879
Non-resident sector		536,267		505,753		30,514			6.0			514,217
Secured loans		326,079		307,683		18,397			6.0			311,048
Other loans		210,187		198,070		12,118			6.1			203,168
Gross customer loans		753,832		735,227		18,604			2.5			743,851
Loan-loss allowances		19,529		19,586		(56	)		(0.3	)		19,697
Net customer loans		734,302		715,642		18,661			2.6			724,154
Pro memoria: Doubtful loans		30,124		26,659		3,465			13.0			27,908
Public sector		88		33		56			171.4			42
Other residents		13,708		11,232		2,476			22.0			12,106
Non-resident sector		16,328		15,394		934			6.1			15,759

Customer loans
Million euros

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Public sector		10,372		11,863		12,054		12,137		12,340		12,565		12,340
Other residents		220,327		224,195		217,421		217,497		210,430		208,493		205,225
Commercial bills		9,918		10,193		10,203		11,146		9,320		8,944		9,075
Secured loans		127,747		129,348		128,360		127,472		124,610		122,884		121,016
Other loans		82,663		84,654		78,858		78,879		76,500		76,665		75,135
Non-resident sector		470,620		510,688		505,753		514,217		510,246		522,815		536,267
Secured loans		292,133		319,425		307,683		311,048		309,769		315,370		326,079
Other loans		178,487		191,263		198,070		203,168		200,476		207,445		210,187
Gross customer loans		701,319		746,746		735,227		743,851		733,016		743,874		753,832
Loan-loss allowances		18,170		18,864		19,586		19,697		19,145		19,904		19,529
Net customer loans		683,149		727,882		715,642		724,154		713,871		723,969		734,302
Pro memoria: Doubtful loans		25,059		26,745		26,659		27,908		27,871		29,597		30,124
Public sector		21		42		33		42		44		85		88
Other residents		10,367		10,833		11,232		12,106		12,539		12,946		13,708
Non-resident sector		14,671		15,871		15,394		15,759		15,287		16,566		16,328

Credit risk management *
Million euros

					Variation
	30.09.11		30.09.10		Amount			%			31.12.10
Non-performing loans		30,910		27,195		3,716			13.7			28,522
NPL ratio (%)		3.86		3.42		0.44	p.					3.55
Loan-loss allowances		20,403		20,490		(87	)		(0.4	)		20,748
Specific		15,300		14,008		1,292			9.2			14,901
Generic		5,103		6,482		(1,378	)		(21.3	)		5,846
NPL coverage (%)		66		75		(9	p.)					73
Credit cost (%) **		1.44		1.65		(0.21	p.)					1.56
Ordinary non-performing and doubtful loans ***		18,412		17,028		1,384			8.1			18,061
NPL ratio (%) ***		2.33		2.17		0.16	p.					2.28
NPL coverage (%) ***		111		120		(10	p.)					115

*	Excluding country-risk
**	Net specific allowance / computable assets
***	Excluding mortgage guarantees
Note:	NPL ratio: Non-performing loans / computable assets

Credit risk management *

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Non-performing loans		25,512		27,325		27,195		28,522		28,494		30,186		30,910
NPL ratio (%)		3.34		3.37		3.42		3.55		3.61		3.78		3.86
Loan-loss allowances		18,898		19,911		20,490		20,748		20,124		20,800		20,403
Specific		12,219		13,232		14,008		14,901		14,992		15,512		15,300
Generic		6,679		6,679		6,482		5,846		5,132		5,288		5,103
NPL coverage (%)		74		73		75		73		71		69		66
Credit cost (%) **		1.58		1.60		1.65		1.56		1.51		1.48		1.44

*	Excluding country-risk
**	Net specific allowance / computable assets

Non-performing loans by quarter
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Balance at beginning of period		24,554			25,512			27,325			27,195			28,522			28,494			30,186
Net additions		3,423			3,389			2,895			3,771			3,112			4,015			4,206
Increase in scope of consolidation		—			—			254			3			186			739			(0	)
Exchange differences		420			1,307			(1,060	)		480			(558	)		(31	)		(444	)
Write-offs		(2,885	)		(2,884	)		(2,219	)		(2,926	)		(2,767	)		(3,031	)		(3,037	)
Balance at period-end		25,512			27,325			27,195			28,522			28,494			30,186			30,910

Customer funds under management
Million euros

					Variation
	30.09.11		30.09.10		Amount			%			31.12.10
Public sector		6,994		11,935		(4,941	)		(41.4	)		9,655
Other residents		161,571		157,895		3,676			2.3			161,096
Demand deposits		67,523		66,505		1,018			1.5			67,077
Time deposits		64,875		81,300		(16,425	)		(20.2	)		81,145
REPOs		29,172		10,090		19,082			189.1			12,873
Non-resident sector		451,346		431,463		19,883			4.6			445,625
Demand deposits		215,260		206,923		8,337			4.0			210,490
Time deposits		194,539		190,920		3,619			1.9			197,590
REPOs		32,034		27,303		4,731			17.3			30,623
Public Sector		9,514		6,317		3,196			50.6			6,922
Customer deposits		619,911		601,293		18,618			3.1			616,376
Debt securities		197,689		208,435		(10,746	)		(5.2	)		192,872
Subordinated debt		25,848		32,287		(6,440	)		(19.9	)		30,475
On-balance-sheet customer funds		843,448		842,016		1,432			0.2			839,723
Mutual funds		103,755		107,833		(4,079	)		(3.8	)		113,510
Pension funds		9,893		10,865		(972	)		(8.9	)		10,965
Managed portfolios		18,796		20,726		(1,931	)		(9.3	)		20,314
Savings-insurance policies		707		2,755		(2,048	)		(74.4	)		758
Other customer funds under management		133,150		142,179		(9,030	)		(6.4	)		145,547
Customer funds under management		976,598		984,195		(7,597	)		(0.8	)		985,269

Mutual funds
Million euros

					Variation
	30.09.11		30.09.10		Amount			%			31.12.10
Spain		28,331		38,257		(9,926	)		(25.9	)		34,310
Portugal		2,159		3,496		(1,337	)		(38.2	)		3,209
Poland		1,888				1,888
United Kingdom		14,686		13,704		982			7.2			14,369
Latin America		56,691		52,377		4,315			8.2			61,621
Total		103,755		107,833		(4,079	)		(3.8	)		113,510

Pension funds
Million euros

					Variation
	30.09.11		30.09.10		Amount			%			31.12.10
Spain		8,910		9,551		(640	)		(6.7	)		9,650
Portugal		983		1,314		(331	)		(25.2	)		1,315
Total		9,893		10,865		(972	)		(8.9	)		10,965

Customer funds under management
Million euros

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Public sector		16,438		10,988		11,935		9,655		8,640		6,558		6,994
Other residents		130,262		158,277		157,895		161,096		163,246		159,076		161,571
Demand deposits		62,678		67,025		66,505		67,077		71,018		69,482		67,523
Time deposits		53,398		77,141		81,300		81,145		78,500		68,378		64,875
REPOs		14,185		14,111		10,090		12,873		13,729		21,216		29,172
Non-resident sector		390,329		426,034		431,463		445,625		448,888		458,780		451,346
Demand deposits		202,484		216,787		206,923		210,490		211,861		215,828		215,260
Time deposits		162,273		173,737		190,920		197,590		197,313		200,843		194,539
REPOs		21,738		27,734		27,303		30,623		31,401		33,085		32,034
Public Sector		3,833		7,776		6,317		6,922		8,312		9,024		9,514
Customer deposits		537,028		595,300		601,293		616,376		620,774		624,414		619,911
Debt securities		210,725		212,424		208,435		192,872		194,271		202,482		197,689
Subordinated debt		34,740		35,497		32,287		30,475		26,431		25,841		25,848
On-balance-sheet customer funds		782,493		843,220		842,016		839,723		841,476		852,737		843,448
Mutual funds		110,797		113,668		107,833		113,510		112,817		112,371		103,755
Pension funds		11,215		10,662		10,865		10,965		10,916		10,744		9,893
Managed portfolios		19,693		21,539		20,726		20,314		18,626		19,005		18,796
Savings-insurance policies		7,501		4,685		2,755		758		833		884		707
Other customer funds under management		149,206		150,554		142,179		145,547		143,192		143,004		133,150
Customer funds under management		931,699		993,774		984,195		985,269		984,668		995,741		976,598

Mutual funds
Million euros

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Spain		40,271		38,395		38,257		34,310		31,974		30,209		28,331
Portugal		4,158		3,524		3,496		3,209		3,051		2,755		2,159
Poland												2,443		1,888
United Kingdom		11,923		13,203		13,704		14,369		14,204		14,532		14,686
Latin America		54,446		58,546		52,377		61,621		63,588		62,433		56,691
Total		110,797		113,668		107,833		113,510		112,817		112,371		103,755

Pension funds
Million euros

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Spain		9,826		9,425		9,551		9,650		9,602		9,477		8,910
Portugal		1,389		1,237		1,314		1,315		1,314		1,266		983
Total		11,215		10,662		10,865		10,965		10,916		10,744		9,893

Shareholders’ equity and minority interests
Million euros

							Variation
	30.09.11			30.09.10			Amount			%			31.12.10
Capital stock		4,220			4,114			106			2.6			4,165
Additional paid-in surplus		29,446			29,305			141			0.5			29,457
Reserves		41,592			35,554			6,039			17.0			36,993
Treasury stock		(276	)		(187	)		(89	)		47.5			(192	)
Shareholders’ equity (before profit and dividends)		74,982			68,786			6,196			9.0			70,423
Attributable profit		5,303			6,080			(777	)		(12.8	)		8,181
Interim dividend distributed		(1,141	)		(1,113	)		(29	)		2.6			(1,270	)
Interim dividend not distributed		—			—			—			—			(2,060	)
Shareholders’ equity (after retained profit)		79,144			73,753			5,391			7.3			75,273
Valuation adjustments		(6,519	)		(2,866	)		(3,653	)		127.4			(2,315	)
Minority interests		5,664			5,372			292			5.4			5,896
Total equity (after retained profit)		78,289			76,259			2,030			2.7			78,854
Preferred shares and securities in subordinated debt		7,125			7,177			(52	)		(0.7	)		7,352
Total equity and capital with the nature of financial liabilities		85,414			83,436			1,978			2.4			86,207

Computable capital and BIS II ratio
Million euros

							Variation
	30.09.11			30.09.10			Amount			%			31.12.10
Core capital		52,638			50,307			2,331			4.6			53,205
Basic capital		60,030			57,718			2,312			4.0			60,617
Supplementary capital		16,480			21,468			(4,987	)		(23.2	)		20,670
Deductions		(2,502	)		(2,118	)		(383	)		18.1			(2,011	)
Computable capital		74,008			77,067			(3,059	)		(4.0	)		79,276
Risk-weighted assets		558,789			593,693			(34,904	)		(5.9	)		604,885
BIS II ratio		13.2			13.0			0.3	p.					13.1
Tier I (before deductions)		10.7			9.7			1.0	p.					10.0
Core capital		9.4			8.5			0.9	p.					8.8
Shareholders’ equity surplus (BIS II ratio)		29,305			29,572			(267	)		(0.9	)		30,885

Key data by principal segments

	Net operating income												Attributable profit to the Group
							Variation												Variation
	9M ’11			9M ’10			Amount			%			9M ’11			9M ’10			Amount			%
Income statement (million euros)
Continental Europe		6,703			6,871			(168	)		(2.4	)		2,441			2,739			(298	)		(10.9	)
o/w: Santander Branch Network		1,815			1,765			51			2.9			602			669			(68	)		(10.1	)
Banesto		876			1,064			(187	)		(17.6	)		189			413			(223	)		(54.1	)
Santander Consumer Finance		2,738			2,501			236			9.5			990			601			389			64.8
Portugal		355			518			(163	)		(31.4	)		129			368			(239	)		(64.9	)
Retail Poland (BZ WBK)		261						261						172						172
United Kingdom		2,437			2,873			(436	)		(15.2	)		757			1,529			(772	)		(50.5	)
Latin America		10,308			9,419			889			9.4			3,528			3,425			103			3.0
o/w: Brazil		7,579			6,615			965			14.6			1,973			2,063			(90	)		(4.4	)
Mexico		1,097			1,122			(25	)		(2.2	)		731			466			266			57.0
Chile		952			975			(23	)		(2.3	)		466			483			(17	)		(3.4	)
Sovereign		905			891			14			1.5			394			293			102			34.7
Operating areas		20,354			20,054			299			1.5			7,120			7,986			(866	)		(10.8	)
Corporate Activities		(1,824	)		(2,116	)		292			(13.8	)		(1,817	)		(1,906	)		89			(4.7	)
Total Group		18,529			17,938			591			3.3			5,303			6,080			(777	)		(12.8	)

	Efficiency ratio (1)				ROE				NPL ratio*				NPL coverage*
	9M ’11		9M ’10		9M ’11		9M ’10		30.09.11		30.09.10		30.09.11		30.09.10
Ratios (%)
Continental Europe		42.3		38.9		10.71		13.57		5.05		4.01		62		75
o/w: Santander Branch Network *		45.8		46.7		11.60		12.44		7.70		4.90		41		55
Banesto		46.4		42.0		5.39		12.37		4.69		3.83		53		60
Santander Consumer Finance		30.9		27.0		13.32		10.35		4.29		5.13		132		122
Portugal		52.6		43.6		6.97		21.35		3.78		2.43		53		69
Retail Poland (BZ WBK)		45.4				26.14				6.26				69
United Kingdom**		43.8		40.0		8.11		23.65		1.88		1.77		40		48
Latin America		38.9		38.4		21.54		21.53		4.10		4.15		102		103
o/w: Brazil		36.8		37.2		22.99		22.11		5.05		4.97		100		98
Mexico		39.8		37.8		21.56		18.94		1.78		2.20		176		199
Chile		38.9		35.6		24.81		28.59		3.63		3.58		88		94
Sovereign		43.7		43.9		13.24		13.89		3.22		4.80		93		72
Operating areas		40.9		39.1		13.83		17.88		3.84		3.39		69		77
Total Group**		44.3		42.9		9.47		11.75		3.86		3.42		66		75

(1)	With amortisations
*	Santander Branch Network is the retail banking unit of Banco Santander S.A. The NPL ratio of Banco Santander S.A. at the end of September 2011 stood at 5.63% (3.79% in September 2010) and NPL coverage was 39% (61% in September 2010).
**	Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, ROE UK: 14.75%; ROE Total Group: 10.57%.

	Employees				Branches
	30.09.11		30.09.10		30.09.11		30.09.10
Operating means
Continental Europe		63,934		54,551		6,636		6,075
o/w: Santander Branch Network		18,747		18,809		2,915		2,931
Banesto		9,560		9,745		1,716		1,767
Santander Consumer Finance		15,452		13,947		662		523
Portugal		6,084		6,218		724		762
Retail Poland (BZ WBK)		9,563				527
United Kingdom		26,034		23,109		1,386		1,328
Latin America		90,106		87,765		5,964		5,784
o/w: Brazil		52,433		52,296		3,731		3,623
Mexico		12,997		12,435		1,099		1,093
Chile		12,300		11,629		494		500
Sovereign		8,950		8,539		723		720
Operating areas		189,024		173,964		14,709		13,907
Corporate Activities		2,326		2,507
Total Group		191,350		176,471		14,709		13,907

Operating areas
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		24,530			23,265			1,265			5.4
Net fees		8,028			7,322			706			9.6
Gains (losses) on financial transactions		1,648			2,116			(468	)		(22.1	)
Other operating income*		218			221			(2	)		(1.0	)
Gross income		34,424			32,923			1,501			4.6
Operating expenses		(14,070	)		(12,869	)		(1,202	)		9.3
General administrative expenses		(12,586	)		(11,562	)		(1,025	)		8.9
Personnel		(7,447	)		(6,702	)		(745	)		11.1
Other general administrative expenses		(5,139	)		(4,859	)		(280	)		5.8
Depreciation and amortisation		(1,484	)		(1,307	)		(177	)		13.5
Net operating income		20,354			20,054			299			1.5
Net loan-loss provisions		(7,817	)		(7,767	)		(50	)		0.6
Other income		(2,123	)		(786	)		(1,337	)		170.0
Profit before taxes		10,413			11,501			(1,088	)		(9.5	)
Tax on profit		(2,641	)		(2,789	)		148			(5.3	)
Profit from continuing operations		7,772			8,712			(939	)		(10.8	)
Net profit from discontinued operations		(3	)		(7	)		4			(57.0	)
Consolidated profit		7,770			8,705			(936	)		(10.7	)
Minority interests		650			719			(70	)		(9.7	)
Attributable profit to the Group		7,120			7,986			(866	)		(10.8	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		731,808		713,972		17,836			2.5
Trading portfolio (w/o loans)		163,840		154,936		8,904			5.7
Available-for-sale financial assets		59,604		62,128		(2,524	)		(4.1	)
Due from credit institutions**		113,823		166,204		(52,381	)		(31.5	)
Intangible assets and property and equipment		12,383		11,272		1,110			9.9
Other assets		125,876		119,012		6,863			5.8
Total assets/liabilities & shareholders’ equity		1,207,333		1,227,524		(20,191	)		(1.6	)
Customer deposits**		607,930		586,798		21,132			3.6
Marketable debt securities**		136,307		134,039		2,269			1.7
Subordinated debt**		16,875		18,422		(1,547	)		(8.4	)
Insurance liabilities		9,894		6,527		3,367			51.6
Due to credit institutions**		180,994		205,613		(24,619	)		(12.0	)
Other liabilities		187,534		211,801		(24,266	)		(11.5	)
Shareholders’ equity***		67,798		64,324		3,474			5.4
Other customer funds under management		133,150		142,179		(9,030	)		(6.4	)
Mutual funds		103,755		107,833		(4,079	)		(3.8	)
Pension funds		9,893		10,865		(972	)		(8.9	)
Managed portfolios		18,796		20,726		(1,931	)		(9.3	)
Savings-insurance policies		707		2,755		(2,048	)		(74.4	)
Customer funds under management		894,262		881,438		12,824			1.5

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE**	13.83	17.88	(4.05	p.)
Efficiency ratio (with amortisations)	40.9	39.1	1.8	p.
NPL ratio	3.84	3.39	0.45	p.
NPL coverage	69	77	(8	p.)
Number of employees (direct & indirect)	189,024	173,964	15,060		8.7
Number of branches	14,709	13,907	802		5.8

Operating areas
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		7,515			7,849			7,901			7,787			8,025			8,252			8,253
Net fees		2,328			2,493			2,501			2,452			2,599			2,733			2,696
Gains (losses) on financial transactions		779			640			697			631			731			563			353
Other operating income*		54			131			36			65			53			131			34
Gross income		10,675			11,113			11,135			10,936			11,409			11,679			11,336
Operating expenses		(4,036	)		(4,355	)		(4,478	)		(4,505	)		(4,579	)		(4,700	)		(4,791	)
General administrative expenses		(3,623	)		(3,903	)		(4,035	)		(4,005	)		(4,102	)		(4,201	)		(4,283	)
Personnel		(2,090	)		(2,276	)		(2,336	)		(2,359	)		(2,433	)		(2,481	)		(2,533	)
Other general administrative expenses		(1,533	)		(1,628	)		(1,699	)		(1,647	)		(1,669	)		(1,721	)		(1,750	)
Depreciation and amortisation		(412	)		(452	)		(443	)		(500	)		(477	)		(499	)		(508	)
Net operating income		6,640			6,758			6,657			6,431			6,830			6,979			6,545
Net loan-loss provisions		(2,398	)		(2,461	)		(2,908	)		(2,380	)		(2,119	)		(2,771	)		(2,927	)
Other income		(297	)		(270	)		(219	)		(330	)		(411	)		(1,289	)		(423	)
Profit before taxes		3,945			4,027			3,530			3,721			4,300			2,919			3,194
Tax on profit		(950	)		(994	)		(845	)		(1,001	)		(1,110	)		(698	)		(832	)
Profit from continuing operations		2,994			3,033			2,685			2,720			3,189			2,221			2,362
Net profit from discontinued operations		(2	)		(1	)		(4	)		(7	)		(6	)		(0	)		3
Consolidated profit		2,993			3,032			2,681			2,713			3,184			2,221			2,365
Minority interests		213			246			260			227			241			230			179
Attributable profit to the Group		2,779			2,785			2,421			2,486			2,943			1,991			2,187

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		681,956		726,706		713,972		721,509		712,729		721,609		731,808
Trading portfolio (w/o loans)		133,509		150,344		154,936		134,668		121,249		140,706		163,840
Available-for-sale financial assets		65,120		66,279		62,128		64,947		63,739		68,586		59,604
Due from credit institutions**		138,519		138,846		166,204		118,416		119,773		111,023		113,823
Intangible assets and property and equipment		10,958		11,491		11,272		12,675		12,389		12,784		12,383
Other assets		91,977		113,369		119,012		124,838		128,780		133,360		125,876
Total assets/liabilities & shareholders’ equity		1,122,038		1,207,035		1,227,524		1,177,052		1,158,659		1,188,068		1,207,333
Customer deposits**		526,831		585,608		586,798		602,118		609,325		613,158		607,930
Marketable debt securities**		130,648		137,164		134,039		130,060		130,251		140,884		136,307
Subordinated debt**		18,693		20,186		18,422		18,347		16,431		16,639		16,875
Insurance liabilities		13,905		10,002		6,527		10,449		10,453		10,775		9,894
Due to credit institutions**		193,995		200,748		205,613		178,908		181,856		176,140		180,994
Other liabilities		179,262		192,217		211,801		173,984		141,210		161,274		187,534
Shareholders’ equity***		58,705		61,110		64,324		63,187		69,132		69,199		67,798
Other customer funds under management		149,206		150,554		142,179		145,547		143,192		143,004		133,150
Mutual funds		110,797		113,668		107,833		113,510		112,817		112,371		103,755
Pension funds		11,215		10,662		10,865		10,965		10,916		10,744		9,893
Managed portfolios		19,693		21,539		20,726		20,314		18,626		19,005		18,796
Savings-insurance policies		7,501		4,685		2,755		758		833		884		707
Customer funds under management		825,378		893,512		881,438		896,072		899,200		913,685		894,262

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	3.32	3.35	3.39	3.53	3.59	3.76	3.84
NPL coverage	75	74	77	75	73	71	69

Continental Europe
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		7,947			7,508			438			5.8
Net fees		3,150			2,775			374			13.5
Gains (losses) on financial transactions		212			677			(465	)		(68.7	)
Other operating income*		303			290			12			4.2
Gross income		11,611			11,251			360			3.2
Operating expenses		(4,908	)		(4,380	)		(528	)		12.1
General administrative expenses		(4,448	)		(3,936	)		(512	)		13.0
Personnel		(2,778	)		(2,496	)		(282	)		11.3
Other general administrative expenses		(1,669	)		(1,440	)		(230	)		15.9
Depreciation and amortisation		(460	)		(444	)		(16	)		3.6
Net operating income		6,703			6,871			(168	)		(2.4	)
Net loan-loss provisions		(2,868	)		(3,022	)		154			(5.1	)
Other income		(379	)		(68	)		(312	)		459.8
Profit before taxes		3,455			3,781			(326	)		(8.6	)
Tax on profit		(912	)		(958	)		46			(4.9	)
Profit from continuing operations		2,544			2,823			(279	)		(9.9	)
Net profit from discontinued operations		(3	)		(7	)		4			(57.0	)
Consolidated profit		2,541			2,817			(276	)		(9.8	)
Minority interests		100			78			22			28.3
Attributable profit to the Group		2,441			2,739			(298	)		(10.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		327,444		326,804		639			0.2
Trading portfolio (w/o loans)		77,735		68,228		9,507			13.9
Available-for-sale financial assets		21,454		25,064		(3,610	)		(14.4	)
Due from credit institutions**		51,957		104,641		(52,684	)		(50.3	)
Intangible assets and property and equipment		5,148		4,958		190			3.8
Other assets		22,687		20,788		1,898			9.1
Total assets/liabilities & shareholders’ equity		506,424		550,483		(44,059	)		(8.0	)
Customer deposits**		255,020		247,464		7,557			3.1
Marketable debt securities**		42,425		49,405		(6,980	)		(14.1	)
Subordinated debt**		985		2,009		(1,025	)		(51.0	)
Insurance liabilities		930		3,585		(2,655	)		(74.1	)
Due to credit institutions**		77,801		103,137		(25,336	)		(24.6	)
Other liabilities		98,425		118,005		(19,580	)		(16.6	)
Shareholders’ equity***		30,838		26,878		3,961			14.7
Other customer funds under management		47,548		60,583		(13,035	)		(21.5	)
Mutual funds		32,377		41,753		(9,375	)		(22.5	)
Pension funds		9,893		10,865		(972	)		(8.9	)
Managed portfolios		5,278		5,434		(156	)		(2.9	)
Savings-insurance policies		—		2,532		(2,532	)		(100.0	)
Customer funds under management		345,978		359,462		(13,484	)		(3.8	)

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	10.71	13.57	(2.86	p.)
Efficiency ratio (with amortisations)	42.3	38.9	3.4	p.
NPL ratio	5.05	4.01	1.04	p.
NPL coverage	62	75	(13	p.)
Number of employees (direct & indirect)	63,934	54,551	9,383		17.2
Number of branches	6,636	6,075	561		9.2

Continental Europe
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,586			2,474			2,449			2,364			2,494			2,767			2,686
Net fees		939			919			918			904			1,019			1,079			1,052
Gains (losses) on financial transactions		310			229			137			169			229			7			(24	)
Other operating income*		61			143			86			106			68			179			56
Gross income		3,895			3,765			3,590			3,542			3,810			4,031			3,770
Operating expenses		(1,430	)		(1,447	)		(1,503	)		(1,538	)		(1,550	)		(1,685	)		(1,674	)
General administrative expenses		(1,287	)		(1,294	)		(1,355	)		(1,365	)		(1,403	)		(1,527	)		(1,517	)
Personnel		(814	)		(833	)		(850	)		(847	)		(879	)		(958	)		(942	)
Other general administrative expenses		(473	)		(461	)		(505	)		(518	)		(524	)		(569	)		(576	)
Depreciation and amortisation		(143	)		(153	)		(148	)		(172	)		(146	)		(158	)		(156	)
Net operating income		2,465			2,318			2,088			2,005			2,260			2,347			2,096
Net loan-loss provisions		(727	)		(811	)		(1,484	)		(998	)		(632	)		(1,082	)		(1,153	)
Other income		(26	)		(59	)		17			(104	)		(112	)		(109	)		(159	)
Profit before taxes		1,712			1,448			621			903			1,516			1,155			784
Tax on profit		(458	)		(380	)		(121	)		(262	)		(418	)		(298	)		(195	)
Profit from continuing operations		1,255			1,068			500			641			1,098			857			589
Net profit from discontinued operations		(2	)		(1	)		(4	)		(7	)		(6	)		(0	)		3
Consolidated profit		1,253			1,067			496			634			1,092			857			592
Minority interests		27			30			22			18			38			37			26
Attributable profit to the Group		1,227			1,037			475			616			1,054			820			567

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11			30.06.11		30.09.11
Balance sheet
Customer loans**		318,249		326,565		326,804		323,660		323,302			331,723		327,444
Trading portfolio (w/o loans)		59,666		64,038		68,228		57,690		51,354			58,046		77,735
Available-for-sale financial assets		25,854		23,497		25,064		23,843		22,441			24,727		21,454
Due from credit institutions**		84,298		92,762		104,641		66,925		64,986			58,814		51,957
Intangible assets and property and equipment		4,964		4,983		4,958		4,965		4,972			5,317		5,148
Other assets		23,156		21,157		20,788		22,160		18,676			21,062		22,687
Total assets/liabilities & shareholders’ equity		516,186		533,002		550,483		499,243		485,731			499,690		506,424
Customer deposits**		210,821		238,074		247,464		247,715		260,719			259,448		255,020
Marketable debt securities**		48,990		47,033		49,405		48,413		47,126			44,702		42,425
Subordinated debt**		2,014		2,050		2,009		1,740		1,219			1,351		985
Insurance liabilities		8,695		5,428		3,585		933		1,021			965		930
Due to credit institutions**		109,578		100,360		103,137		77,059		72,276			76,876		77,801
Other liabilities		109,255		112,790		118,005		95,963		73,325			85,058		98,425
Shareholders’ equity***		26,833		27,267		26,878		27,420		30,045			31,290		30,838
Other customer funds under management		68,520		62,487		60,583		53,968		51,296			52,169		47,548
Mutual funds		44,429		41,919		41,753		37,519		35,025			35,407		32,377
Pension funds		11,215		10,662		10,865		10,965		10,916			10,744		9,893
Managed portfolios		5,515		5,442		5,434		5,484		5,354			6,019		5,278
Savings-insurance policies		7,362		4,465		2,532		0		(0	)		—		—
Customer funds under management		330,346		349,645		359,462		351,836		360,361			357,669		345,978

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	3.73	3.87	4.01	4.34	4.57	4.77	5.05
NPL coverage	74	71	75	71	67	65	62

Santander Branch Network
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		2,457			2,419			39			1.6
Net fees		845			827			18			2.2
Gains (losses) on financial transactions		79			90			(11	)		(12.2	)
Other operating income*		(31	)		(24	)		(7	)		27.3
Gross income		3,351			3,312			39			1.2
Operating expenses		(1,536	)		(1,547	)		12			(0.7	)
General administrative expenses		(1,421	)		(1,428	)		7			(0.5	)
Personnel		(929	)		(924	)		(5	)		0.6
Other general administrative expenses		(492	)		(504	)		13			(2.5	)
Depreciation and amortisation		(115	)		(119	)		4			(3.5	)
Net operating income		1,815			1,765			51			2.9
Net loan-loss provisions		(970	)		(868	)		(102	)		11.7
Other income		(20	)		20			(41	)		—
Profit before taxes		825			917			(92	)		(10.1	)
Tax on profit		(223	)		(248	)		25			(10.1	)
Profit from continuing operations		602			669			(67	)		(10.1	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		602			669			(67	)		(10.1	)
Minority interests		0			0			0			52.7
Attributable profit to the Group		602			669			(68	)		(10.1	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		104,671		112,812		(8,141	)		(7.2	)
Trading portfolio (w/o loans)		—		—		—			—
Available-for-sale financial assets		—		—		—			—
Due from credit institutions**		137		217		(80	)		(36.9	)
Intangible assets and property and equipment		1,201		1,211		(10	)		(0.9	)
Other assets		1,785		476		1,309			275.2
Total assets/liabilities & shareholders’ equity		107,794		114,716		(6,922	)		(6.0	)
Customer deposits**		81,063		87,224		(6,161	)		(7.1	)
Marketable debt securities**		—		—		—			—
Subordinated debt**		—		—		—			—
Insurance liabilities		—		—		—			—
Due to credit institutions**		524		808		(284	)		(35.2	)
Other liabilities		19,526		19,649		(123	)		(0.6	)
Shareholders’ equity***		6,681		7,035		(354	)		(5.0	)
Other customer funds under management		23,883		27,678		(3,795	)		(13.7	)
Mutual funds		16,712		20,980		(4,268	)		(20.3	)
Pension funds		5,628		6,125		(496	)		(8.1	)
Managed portfolios		—		—		—			—
Savings-insurance policies		1,543		574		969			168.7
Customer funds under management		104,946		114,902		(9,956	)		(8.7	)

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	11.60	12.44	(0.84	p.)
Efficiency ratio (with amortisations)	45.8	46.7	(0.9	p.)
NPL ratio	7.70	4.90	2.80	p.
NPL coverage	41	55	(14	p.)
Number of employees (direct & indirect)	18,747	18,809	(62	)	(0.3	)
Number of branches	2,915	2,931	(16	)	(0.5	)

Santander Branch Network
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		893			785			740			721			780			853			824
Net fees		290			276			261			253			292			283			270
Gains (losses) on financial transactions		31			38			21			19			37			27			15
Other operating income*		(8	)		(7	)		(10	)		(7	)		(10	)		(12	)		(9	)
Gross income		1,207			1,092			1,013			986			1,100			1,151			1,100
Operating expenses		(516	)		(516	)		(516	)		(525	)		(512	)		(512	)		(512	)
General administrative expenses		(476	)		(476	)		(476	)		(482	)		(474	)		(473	)		(474	)
Personnel		(311	)		(309	)		(304	)		(310	)		(310	)		(310	)		(310	)
Other general administrative expenses		(165	)		(167	)		(172	)		(172	)		(164	)		(163	)		(164	)
Depreciation and amortisation		(40	)		(40	)		(40	)		(43	)		(38	)		(39	)		(38	)
Net operating income		691			576			497			462			588			639			588
Net loan-loss provisions		(136	)		(179	)		(553	)		(223	)		(184	)		(339	)		(447	)
Other income		(8	)		14			15			4			(27	)		10			(3	)
Profit before taxes		547			411			(41	)		243			376			310			139
Tax on profit		(148	)		(111	)		11			(66	)		(101	)		(84	)		(37	)
Profit from continuing operations		399			300			(30	)		178			274			227			101
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		399			300			(30	)		178			274			227			101
Minority interests		0			0			0			0			0			0			(0	)
Attributable profit to the Group		399			300			(30	)		178			274			226			101

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		113,967		115,196		112,812		111,372		110,051		107,312		104,671
Trading portfolio (w/o loans)		—		—		—		—		—		—		—
Available-for-sale financial assets		—		—		—		—		—		—		—
Due from credit institutions**		31		111		217		214		214		185		137
Intangible assets and property and equipment		1,211		1,211		1,211		1,201		1,201		1,201		1,201
Other assets		638		676		476		481		411		1,692		1,785
Total assets/liabilities & shareholders’ equity		115,847		117,195		114,716		113,268		111,878		110,390		107,794
Customer deposits**		78,753		87,808		87,224		85,667		84,656		80,037		81,063
Marketable debt securities**		—		—		—		—		—		—		—
Subordinated debt**		—		—		—		—		—		—		—
Insurance liabilities		—		—		—		—		—		—		—
Due to credit institutions**		583		781		808		457		323		355		524
Other liabilities		29,387		21,214		19,649		20,089		20,002		22,954		19,526
Shareholders’ equity***		7,125		7,392		7,035		7,056		6,897		7,043		6,681
Other customer funds under management		28,841		27,522		27,678		26,864		25,478		25,171		23,883
Mutual funds		21,325		20,811		20,980		20,347		18,558		17,654		16,712
Pension funds		6,324		6,064		6,125		6,132		6,225		6,141		5,628
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		1,192		647		574		385		696		1,376		1,543
Customer funds under management		107,594		115,330		114,902		112,531		110,134		105,208		104,946

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	4.65	4.78	4.90	5.52	5.99	6.73	7.70
NPL coverage	59	53	55	52	50	47	41
Spread	2.60	2.04	1.87	1.89	1.95	2.53	2.38
Spread loans	2.10	1.94	1.83	1.83	1.90	1.97	2.03
Spread deposits	0.50	0.10	0.04	0.06	0.05	0.56	0.35

Banesto
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,030			1,206			(176	)		(14.6	)
Net fees		462			463			(0	)		(0.1	)
Gains (losses) on financial transactions		103			116			(13	)		(11.3	)
Other operating income*		39			50			(12	)		(22.9	)
Gross income		1,634			1,835			(201	)		(10.9	)
Operating expenses		(758	)		(771	)		13			(1.7	)
General administrative expenses		(664	)		(678	)		15			(2.1	)
Personnel		(486	)		(505	)		19			(3.7	)
Other general administrative expenses		(177	)		(173	)		(4	)		2.4
Depreciation and amortisation		(94	)		(93	)		(1	)		1.3
Net operating income		876			1,064			(187	)		(17.6	)
Net loan-loss provisions		(461	)		(459	)		(2	)		0.5
Other income		(136	)		14			(150	)		—
Profit before taxes		279			619			(340	)		(55.0	)
Tax on profit		(61	)		(154	)		93			(60.1	)
Profit from continuing operations		217			465			(248	)		(53.3	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		217			465			(248	)		(53.3	)
Minority interests		28			53			(25	)		(46.8	)
Attributable profit to the Group		189			413			(223	)		(54.1	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		69,245		74,393		(5,147	)		(6.9	)
Trading portfolio (w/o loans)		7,699		7,644		55			0.7
Available-for-sale financial assets		7,206		9,827		(2,622	)		(26.7	)
Due from credit institutions**		10,286		25,928		(15,642	)		(60.3	)
Intangible assets and property and equipment		1,356		1,387		(31	)		(2.3	)
Other assets		5,989		6,633		(644	)		(9.7	)
Total assets/liabilities & shareholders’ equity		101,780		125,812		(24,032	)		(19.1	)
Customer deposits**		51,385		58,685		(7,300	)		(12.4	)
Marketable debt securities**		24,608		28,256		(3,648	)		(12.9	)
Subordinated debt**		790		1,325		(535	)		(40.4	)
Insurance liabilities		—		—		—			—
Due to credit institutions**		9,319		20,346		(11,027	)		(54.2	)
Other liabilities		10,969		12,715		(1,747	)		(13.7	)
Shareholders’ equity***		4,709		4,484		225			5.0
Other customer funds under management		8,687		10,026		(1,339	)		(13.4	)
Mutual funds		4,688		6,164		(1,476	)		(24.0	)
Pension funds		1,229		1,338		(108	)		(8.1	)
Managed portfolios		114		104		11			10.1
Savings-insurance policies		2,656		2,421		235			9.7
Customer funds under management		85,470		98,292		(12,822	)		(13.0	)

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	5.39	12.37	(6.98	p.)
Efficiency ratio (with amortisations)	46.4	42.0	4.4	p.
NPL ratio	4.69	3.83	0.86	p.
NPL coverage	53	60	(6	p.)
Number of employees (direct & indirect)	9,560	9,745	(185	)	(1.9	)
Number of branches	1,716	1,767	(51	)	(2.9	)

Banesto
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		432			405			369			315			321			358			351
Net fees		156			153			153			155			155			155			152
Gains (losses) on financial transactions		43			36			37			80			41			41			20
Other operating income*		10			26			14			18			9			24			6
Gross income		641			620			573			568			527			578			529
Operating expenses		(257	)		(258	)		(256	)		(256	)		(254	)		(254	)		(250	)
General administrative expenses		(225	)		(228	)		(225	)		(225	)		(223	)		(222	)		(218	)
Personnel		(168	)		(169	)		(167	)		(161	)		(163	)		(162	)		(161	)
Other general administrative expenses		(57	)		(59	)		(58	)		(64	)		(60	)		(60	)		(58	)
Depreciation and amortisation		(32	)		(30	)		(31	)		(31	)		(31	)		(32	)		(31	)
Net operating income		384			362			317			312			273			324			280
Net loan-loss provisions		(83	)		(92	)		(284	)		(251	)		(102	)		(173	)		(187	)
Other income		9			5			0			(43	)		(16	)		(60	)		(60	)
Profit before taxes		310			275			34			18			155			91			33
Tax on profit		(85	)		(68	)		(1	)		(7	)		(38	)		(12	)		(11	)
Profit from continuing operations		225			206			33			10			117			79			22
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		225			206			33			10			117			79			22
Minority interests		22			24			6			4			16			12			(0	)
Attributable profit to the Group		203			182			27			6			101			67			22

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		75,382		76,125		74,393		75,624		73,326		71,825		69,245
Trading portfolio (w/o loans)		7,977		7,339		7,644		6,575		5,979		5,572		7,699
Available-for-sale financial assets		9,097		7,693		9,827		9,025		9,328		9,189		7,206
Due from credit institutions**		21,756		27,178		25,928		17,103		16,597		10,845		10,286
Intangible assets and property and equipment		1,406		1,415		1,387		1,374		1,360		1,356		1,356
Other assets		8,182		6,259		6,633		7,520		5,834		6,172		5,989
Total assets/liabilities & shareholders’ equity		123,800		126,010		125,812		117,222		112,426		104,959		101,780
Customer deposits**		59,037		59,609		58,685		59,721		59,660		54,047		51,385
Marketable debt securities**		28,087		27,160		28,256		27,684		27,135		26,303		24,608
Subordinated debt**		1,331		1,329		1,325		1,304		787		785		790
Insurance liabilities		—		—		—		—		—		—		—
Due to credit institutions**		18,162		19,549		20,346		13,422		10,822		9,961		9,319
Other liabilities		12,707		13,884		12,715		10,611		9,305		9,158		10,969
Shareholders’ equity***		4,475		4,479		4,484		4,480		4,717		4,704		4,709
Other customer funds under management		10,809		10,131		10,026		9,616		9,303		8,933		8,687
Mutual funds		7,106		6,423		6,164		5,712		5,279		4,902		4,688
Pension funds		1,405		1,337		1,338		1,337		1,344		1,321		1,229
Managed portfolios		93		98		104		117		114		118		114
Savings-insurance policies		2,205		2,274		2,421		2,450		2,566		2,592		2,656
Customer funds under management		99,264		98,229		98,292		98,325		96,884		90,069		85,470

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	3.13	3.49		3.83		4.11		4.31		4.54	4.69
NPL coverage	61	58		60		54		52		52	53
Spread	2.20	1.65		1.41		1.47		1.67		2.20	2.54
Spread loans	2.02	2.00		1.92		1.99		2.03		2.08	2.12
Spread deposits	0.18	(0.35	)	(0.51	)	(0.52	)	(0.36	)	0.12	0.42

Santander Consumer Finance
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		3,088			2,699			388			14.4
Net fees		878			701			176			25.2
Gains (losses) on financial transactions		(5	)		5			(10	)		—
Other operating income*		1			19			(18	)		(95.5	)
Gross income		3,961			3,425			536			15.6
Operating expenses		(1,224	)		(924	)		(300	)		32.4
General administrative expenses		(1,125	)		(840	)		(285	)		33.9
Personnel		(580	)		(431	)		(149	)		34.5
Other general administrative expenses		(545	)		(409	)		(136	)		33.3
Depreciation and amortisation		(98	)		(83	)		(15	)		17.4
Net operating income		2,738			2,501			236			9.5
Net loan-loss provisions		(1,174	)		(1,521	)		347			(22.8	)
Other income		(98	)		(104	)		5			(5.1	)
Profit before taxes		1,465			877			588			67.1
Tax on profit		(411	)		(245	)		(165	)		67.4
Profit from continuing operations		1,054			631			423			67.0
Net profit from discontinued operations		(3	)		(7	)		4			(57.0	)
Consolidated profit		1,051			625			427			68.3
Minority interests		61			24			37			155.5
Attributable profit to the Group		990			601			389			64.8

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		70,246		63,624		6,622			10.4
Trading portfolio (w/o loans)		1,483		1,570		(87	)		(5.5	)
Available-for-sale financial assets		387		762		(375	)		(49.2	)
Due from credit institutions**		7,968		7,324		644			8.8
Intangible assets and property and equipment		823		871		(49	)		(5.6	)
Other assets		3,858		3,069		788			25.7
Total assets/liabilities & shareholders’ equity		84,765		77,221		7,544			9.8
Customer deposits**		34,181		25,460		8,721			34.3
Marketable debt securities**		11,324		11,103		221			2.0
Subordinated debt**		65		423		(358	)		(84.6	)
Insurance liabilities		—		—		—			—
Due to credit institutions**		23,825		27,737		(3,912	)		(14.1	)
Other liabilities		5,364		4,483		881			19.7
Shareholders’ equity***		10,006		8,015		1,991			24.8
Other customer funds under management		6		24		(17	)		(73.4	)
Mutual funds		2		19		(17	)		(87.9	)
Pension funds		4		5		(1	)		(16.5	)
Managed portfolios		—		—		—			—
Savings-insurance policies		—		—		—			—
Customer funds under management		45,576		37,010		8,567			23.1

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	13.32	10.35	2.97	p.
Efficiency ratio (with amortisations)	30.9	27.0	3.9	p.
NPL ratio	4.29	5.13	(0.84	p.)
NPL coverage	132	122	10	p.
Number of employees (direct & indirect)	15,452	13,947	1,505		10.8
Number of branches	662	523	139		26.6

Santander Consumer Finance
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		852			877			970			963			1,034			1,029			1,024
Net fees		216			237			248			254			289			293			296
Gains (losses) on financial transactions		3			(3	)		5			(12	)		(7	)		(1	)		3
Other operating income*		7			4			9			3			2			5			(6	)
Gross income		1,078			1,115			1,232			1,209			1,319			1,325			1,317
Operating expenses		(292	)		(290	)		(342	)		(349	)		(399	)		(409	)		(416	)
General administrative expenses		(266	)		(261	)		(314	)		(316	)		(366	)		(376	)		(384	)
Personnel		(137	)		(133	)		(162	)		(164	)		(189	)		(194	)		(196	)
Other general administrative expenses		(129	)		(128	)		(153	)		(152	)		(176	)		(182	)		(187	)
Depreciation and amortisation		(26	)		(29	)		(28	)		(33	)		(33	)		(32	)		(33	)
Net operating income		786			825			890			860			920			917			900
Net loan-loss provisions		(498	)		(471	)		(551	)		(497	)		(328	)		(418	)		(427	)
Other income		(15	)		(58	)		(30	)		(39	)		(37	)		(47	)		(14	)
Profit before taxes		273			296			309			324			555			452			459
Tax on profit		(77	)		(83	)		(85	)		(94	)		(168	)		(126	)		(117	)
Profit from continuing operations		195			213			223			230			387			326			342
Net profit from discontinued operations		(2	)		(1	)		(4	)		(7	)		(6	)		(0	)		3
Consolidated profit		194			212			220			223			381			325			345
Minority interests		4			5			14			13			22			19			20
Attributable profit to the Group		189			206			205			210			359			306			325

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		58,198		59,372		63,624		63,342		70,259		70,207		70,246
Trading portfolio (w/o loans)		768		1,838		1,570		1,146		968		1,405		1,483
Available-for-sale financial assets		453		802		762		558		517		504		387
Due from credit institutions**		7,283		7,780		7,324		8,016		7,253		7,942		7,968
Intangible assets and property and equipment		842		863		871		889		875		939		823
Other assets		2,694		2,950		3,069		2,892		2,579		2,846		3,858
Total assets/liabilities & shareholders’ equity		70,237		73,605		77,221		76,844		82,452		83,843		84,765
Customer deposits**		23,114		22,791		25,460		25,950		31,619		32,658		34,181
Marketable debt securities**		6,872		7,919		11,103		11,717		11,462		11,636		11,324
Subordinated debt**		424		427		423		428		425		449		65
Insurance liabilities		—		—		—		—		—		—		—
Due to credit institutions**		28,814		30,000		27,737		25,864		25,072		24,692		23,825
Other liabilities		3,516		4,511		4,483		4,273		3,830		4,397		5,364
Shareholders’ equity***		7,498		7,958		8,015		8,611		10,044		10,011		10,006
Other customer funds under management		24		24		24		24		7		7		6
Mutual funds		19		19		19		19		3		2		2
Pension funds		5		5		5		5		4		4		4
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		30,433		31,160		37,010		38,118		43,512		44,750		45,576

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	5.12	5.23	5.13	4.95	4.63	4.42	4.29
NPL coverage	108	111	122	128	122	128	132
Spread loans	5.90	6.19	6.72	6.94	6.69	5.99	5.98

Portugal
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		456			551			(95	)		(17.2	)
Net fees		270			275			(5	)		(1.9	)
Gains (losses) on financial transactions		6			58			(51	)		(89.0	)
Other operating income*		16			35			(19	)		(53.1	)
Gross income		749			919			(170	)		(18.5	)
Operating expenses		(394	)		(401	)		7			(1.8	)
General administrative expenses		(342	)		(347	)		5			(1.5	)
Personnel		(237	)		(239	)		2			(0.9	)
Other general administrative expenses		(105	)		(108	)		3			(2.8	)
Depreciation and amortisation		(52	)		(53	)		2			(3.5	)
Net operating income		355			518			(163	)		(31.4	)
Net loan-loss provisions		(122	)		(103	)		(19	)		18.3
Other income		(68	)		28			(96	)		—
Profit before taxes		165			443			(278	)		(62.7	)
Tax on profit		(36	)		(75	)		39			(51.8	)
Profit from continuing operations		129			368			(239	)		(64.9	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		129			368			(239	)		(64.9	)
Minority interests		(0	)		0			(1	)		—
Attributable profit to the Group		129			368			(239	)		(64.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		28,945		33,342		(4,398	)		(13.2	)
Trading portfolio (w/o loans)		1,575		1,787		(213	)		(11.9	)
Available-for-sale financial assets		4,172		6,786		(2,614	)		(38.5	)
Due from credit institutions**		2,164		4,702		(2,538	)		(54.0	)
Intangible assets and property and equipment		460		479		(18	)		(3.9	)
Other assets		6,569		4,514		2,055			45.5
Total assets/liabilities & shareholders’ equity		43,884		51,610		(7,726	)		(15.0	)
Customer deposits**		22,812		19,818		2,994			15.1
Marketable debt securities**		5,170		8,545		(3,375	)		(39.5	)
Subordinated debt**		22		254		(232	)		(91.3	)
Insurance liabilities		75		1,494		(1,419	)		(95.0	)
Due to credit institutions**		13,079		18,490		(5,411	)		(29.3	)
Other liabilities		183		883		(700	)		(79.3	)
Shareholders’ equity***		2,543		2,126		417			19.6
Other customer funds under management		3,213		6,348		(3,135	)		(49.4	)
Mutual funds		2,159		3,496		(1,337	)		(38.2	)
Pension funds		983		1,314		(331	)		(25.2	)
Managed portfolios		72		130		(59	)		(45.0	)
Savings-insurance policies		—		1,408		(1,408	)		(100.0	)
Customer funds under management		31,218		34,965		(3,748	)		(10.7	)

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	6.97	21.35	(14.38	p.)
Efficiency ratio (with amortisations)	52.6	43.6	9.0	p.
NPL ratio	3.78	2.43	1.35	p.
NPL coverage	53	69	(16	p.)
Number of employees (direct & indirect)	6,084	6,218	(134	)	(2.2	)
Number of branches	724	762	(38	)	(5.0	)

Portugal
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		188			186			178			173			165			155			137
Net fees		94			94			87			82			101			82			87
Gains (losses) on financial transactions		25			29			4			9			8			0			(1	)
Other operating income*		14			12			9			7			8			6			2
Gross income		320			321			278			271			282			243			225
Operating expenses		(129	)		(133	)		(139	)		(140	)		(131	)		(131	)		(132	)
General administrative expenses		(111	)		(115	)		(121	)		(120	)		(114	)		(114	)		(114	)
Personnel		(77	)		(79	)		(83	)		(82	)		(79	)		(79	)		(79	)
Other general administrative expenses		(34	)		(36	)		(38	)		(38	)		(35	)		(35	)		(35	)
Depreciation and amortisation		(17	)		(18	)		(18	)		(20	)		(17	)		(17	)		(18	)
Net operating income		192			188			138			132			151			112			93
Net loan-loss provisions		(16	)		(43	)		(44	)		(6	)		(32	)		(40	)		(50	)
Other income		(8	)		(1	)		37			(8	)		(9	)		(14	)		(45	)
Profit before taxes		168			144			131			117			110			57			(2	)
Tax on profit		(31	)		(20	)		(23	)		(29	)		(19	)		(17	)		(0	)
Profit from continuing operations		137			123			108			88			91			41			(2	)
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		137			123			108			88			91			41			(2	)
Minority interests		0			0			0			0			0			(0	)		(0	)
Attributable profit to the Group		137			123			108			88			90			41			(2	)

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		32,317		33,262		33,342		30,102		29,744		29,212		28,945
Trading portfolio (w/o loans)		1,533		1,737		1,787		1,741		1,411		1,263		1,575
Available-for-sale financial assets		7,786		6,728		6,786		6,458		4,584		4,158		4,172
Due from credit institutions**		4,604		5,205		4,702		3,401		3,932		2,119		2,164
Intangible assets and property and equipment		487		480		479		480		472		467		460
Other assets		4,961		4,692		4,514		7,091		6,656		6,859		6,569
Total assets/liabilities & shareholders’ equity		51,687		52,104		51,610		49,272		46,798		44,078		43,884
Customer deposits**		16,609		18,360		19,818		21,727		21,929		22,228		22,812
Marketable debt securities**		12,413		10,172		8,545		7,544		7,122		5,365		5,170
Subordinated debt**		253		254		254		0		0		9		22
Insurance liabilities		3,187		2,465		1,494		79		83		81		75
Due to credit institutions**		15,626		17,990		18,490		16,817		14,208		13,248		13,079
Other liabilities		992		682		883		1,171		843		630		183
Shareholders’ equity***		2,607		2,182		2,126		1,933		2,613		2,516		2,543
Other customer funds under management		8,747		7,267		6,348		4,655		4,500		4,155		3,213
Mutual funds		4,158		3,524		3,496		3,209		3,051		2,755		2,159
Pension funds		1,389		1,237		1,314		1,315		1,314		1,266		983
Managed portfolios		127		129		130		131		135		133		72
Savings-insurance policies		3,073		2,377		1,408		—		—		—		—
Customer funds under management		38,022		36,053		34,965		33,927		33,551		31,757		31,218

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	2.32	2.40	2.43	2.90	3.03	3.25		3.78
NPL coverage	64	65	69	60	62	62		53
Spread (Retail Banking)	1.85	1.92	2.03	2.11	2.08	1.75		1.68
Spread loans	1.76	1.82	1.82	1.88	1.96	2.06		2.15
Spread deposits	0.09	0.10	0.21	0.23	0.12	(0.31	)	(0.47	)

Retail Poland (BZ WBK)
Million euros

	9M ’11
Income statement
Net interest income		245
Net fees		171
Gains (losses) on financial transactions		46
Other operating income*		16
Gross income		477
Operating expenses		(217	)
General administrative expenses		(199	)
Personnel		(119	)
Other general administrative expenses		(80	)
Depreciation and amortisation		(18	)
Net operating income		261
Net loan-loss provisions		(39	)
Other income		(2	)
Profit before taxes		220
Tax on profit		(42	)
Profit from continuing operations		178
Net profit from discontinued operations		—
Consolidated profit		178
Minority interests		6
Attributable profit to the Group		172

* Including dividends, income from equity-accounted method and other operating income/expenses

	30.09.11
Balance sheet
Customer loans**		8,219
Trading portfolio (w/o loans)		985
Available-for-sale financial assets		2,639
Due from credit institutions**		410
Intangible assets and property and equipment		261
Other assets		978
Total assets/liabilities & shareholders’ equity		13,491
Customer deposits**		9,936
Marketable debt securities**		—
Subordinated debt**		100
Insurance liabilities		—
Due to credit institutions**		1,617
Other liabilities		614
Shareholders’ equity***		1,224
Other customer funds under management		2,091
Mutual funds		1,888
Pension funds		—
Managed portfolios		203
Savings-insurance policies		—
Customer funds under management		12,127

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	26.14
Efficiency ratio (with amortisations)	45.4
NPL ratio	6.26
NPL coverage	69
Number of employees (direct & indirect)	9,563
Number of branches	527

Retail Poland (BZ WBK)
Million euros

	Q2 ’11			Q3 ’11
Income statement
Net interest income		122			122
Net fees		88			83
Gains (losses) on financial transactions		20			26
Other operating income*		18			(2	)
Gross income		248			229
Operating expenses		(114	)		(103	)
General administrative expenses		(105	)		(94	)
Personnel		(61	)		(58	)
Other general administrative expenses		(44	)		(36	)
Depreciation and amortisation		(9	)		(9	)
Net operating income		134			126
Net loan-loss provisions		(16	)		(23	)
Other income		(0	)		(1	)
Profit before taxes		118			101
Tax on profit		(21	)		(21	)
Profit from continuing operations		98			81
Net profit from discontinued operations		—			—
Consolidated profit		98			81
Minority interests		4			2
Attributable profit to the Group		94			78

* Including dividends, income from equity-accounted method and other operating income/expenses

	30.06.11		30.09.11
Balance sheet
Customer loans**		8,659		8,219
Trading portfolio (w/o loans)		920		985
Available-for-sale financial assets		3,142		2,639
Due from credit institutions**		214		410
Intangible assets and property and equipment		302		261
Other assets		823		978
Total assets/liabilities & shareholders’ equity		14,061		13,491
Customer deposits**		10,217		9,936
Marketable debt securities**		—		—
Subordinated debt**		100		100
Insurance liabilities		—		—
Due to credit institutions**		1,800		1,617
Other liabilities		595		614
Shareholders’ equity***		1,349		1,224
Other customer funds under management		2,739		2,091
Mutual funds		2,443		1,888
Pension funds		—		—
Managed portfolios		296		203
Savings-insurance policies		—		—
Customer funds under management		13,055		12,127

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	6.43	6.26
NPL coverage	67	69

Retail Poland (BZ WBK)
Million polish zloty

	9M ’11
Income statement
Net interest income		982
Net fees		688
Gains (losses) on financial transactions		184
Other operating income*		62
Gross income		1,917
Operating expenses		(870	)
General administrative expenses		(799	)
Personnel		(477	)
Other general administrative expenses		(323	)
Depreciation and amortisation		(71	)
Net operating income		1,047
Net loan-loss provisions		(157	)
Other income		(7	)
Profit before taxes		883
Tax on profit		(167	)
Profit from continuing operations		716
Net profit from discontinued operations		—
Consolidated profit		716
Minority interests		25
Attributable profit to the Group		691

* Including dividends, income from equity-accounted method and other operating income/expenses

	30.09.11
Balance sheet
Customer loans**		36,204
Trading portfolio (w/o loans)		4,337
Available-for-sale financial assets		11,624
Due from credit institutions**		1,806
Intangible assets and property and equipment		1,149
Other assets		4,309
Total assets/liabilities & shareholders’ equity		59,429
Customer deposits**		43,769
Marketable debt securities**		—
Subordinated debt**		441
Insurance liabilities		—
Due to credit institutions**		7,123
Other liabilities		2,705
Shareholders’ equity***		5,392
Other customer funds under management		9,212
Mutual funds		8,316
Pension funds		—
Managed portfolios		896
Savings-insurance policies		—
Customer funds under management		53,422

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Retail Poland (BZ WBK)
Million polish zloty

	Q2 ’11			Q3 ’11
Income statement
Net interest income		483			499
Net fees		349			339
Gains (losses) on financial transactions		78			106
Other operating income*		71			(8	)
Gross income		980			936
Operating expenses		(449	)		(421	)
General administrative expenses		(413	)		(386	)
Personnel		(239	)		(237	)
Other general administrative expenses		(174	)		(149	)
Depreciation and amortisation		(36	)		(35	)
Net operating income		531			515
Net loan-loss provisions		(62	)		(95	)
Other income		(2	)		(5	)
Profit before taxes		468			415
Tax on profit		(82	)		(85	)
Profit from continuing operations		386			330
Net profit from discontinued operations		—			—
Consolidated profit		386			330
Minority interests		15			9
Attributable profit to the Group		370			321

* Including dividends, income from equity-accounted method and other operating income/expenses

	30.06.11		30.09.11
Balance sheet
Customer loans**		34,554		36,204
Trading portfolio (w/o loans)		3,671		4,337
Available-for-sale financial assets		12,539		11,624
Due from credit institutions**		855		1,806
Intangible assets and property and equipment		1,206		1,149
Other assets		3,285		4,309
Total assets/liabilities & shareholders’ equity		56,109		59,429
Customer deposits**		40,770		43,769
Marketable debt securities**		—		—
Subordinated debt**		398		441
Insurance liabilities		—		—
Due to credit institutions**		7,182		7,123
Other liabilities		2,376		2,705
Shareholders’ equity***		5,383		5,392
Other customer funds under management		10,928		9,212
Mutual funds		9,748		8,316
Pension funds		—		—
Managed portfolios		1,180		896
Savings-insurance policies		—		—
Customer funds under management		52,095		53,422

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

United Kingdom
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		3,144			3,601			(457	)		(12.7	)
Net fees		803			791			13			1.6
Gains (losses) on financial transactions		374			380			(6	)		(1.6	)
Other operating income*		17			19			(1	)		(6.8	)
Gross income		4,339			4,790			(451	)		(9.4	)
Operating expenses		(1,901	)		(1,917	)		16			(0.8	)
General administrative expenses		(1,633	)		(1,687	)		54			(3.2	)
Personnel		(1,021	)		(978	)		(43	)		4.4
Other general administrative expenses		(612	)		(709	)		97			(13.7	)
Depreciation and amortisation		(268	)		(230	)		(38	)		16.4
Net operating income		2,437			2,873			(436	)		(15.2	)
Net loan-loss provisions		(432	)		(751	)		319			(42.5	)
Other income		(955	)		(17	)		(938	)		—
Profit before taxes		1,051			2,105			(1,054	)		(50.1	)
Tax on profit		(294	)		(576	)		282			(48.9	)
Profit from continuing operations		757			1,529			(772	)		(50.5	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		757			1,529			(772	)		(50.5	)
Minority interests		0			0			(0	)		(93.1	)
Attributable profit to the Group**		757			1,529			(772	)		(50.5	)

*	Including dividends, income from equity-accounted method and other operating income/expenses
**	Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, 2011 profit was EUR 1,377 million

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans***		235,140		233,694		1,445			0.6
Trading portfolio (w/o loans)		49,693		51,969		(2,276	)		(4.4	)
Available-for-sale financial assets		1,108		942		166			17.7
Due from credit institutions***		36,776		37,912		(1,136	)		(3.0	)
Intangible assets and property and equipment		2,237		1,457		779			53.5
Other assets		43,549		42,281		1,268			3.0
Total assets/liabilities & shareholders’ equity		368,502		368,255		246			0.1
Customer deposits***		187,141		180,490		6,651			3.7
Marketable debt securities***		70,042		70,657		(615	)		(0.9	)
Subordinated debt***		7,939		8,364		(424	)		(5.1	)
Insurance liabilities		—		1		(1	)		(100.0	)
Due to credit institutions***		50,793		54,402		(3,609	)		(6.6	)
Other liabilities		39,947		41,453		(1,506	)		(3.6	)
Shareholders’ equity****		12,640		12,889		(250	)		(1.9	)
Other customer funds under management		14,686		13,704		982			7.2
Mutual funds		14,686		13,704		982			7.2
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		—		—		—			—
Customer funds under management		279,808		273,214		6,594			2.4

***	Including all on-balance sheet balances for this item
****	Not including profit of the year

Ratios (%) and other data
ROE**	8.11	23.65	(15.54	p.)
Efficiency ratio (with amortisations)	43.8	40.0	3.8	p.
NPL ratio	1.88	1.77	0.11	p.
NPL coverage	40	48	(8	p.)
Number of employees (direct & indirect)	26,034	23,109	2,925		12.7
Number of branches	1,386	1,328	58		4.4

United Kingdom
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,161			1,207			1,232			1,165			1,110			1,021			1,013
Net fees		249			272			270			236			232			294			278
Gains (losses) on financial transactions		133			134			113			82			157			130			87
Other operating income*		6			6			6			11			6			6			5
Gross income		1,549			1,620			1,621			1,495			1,505			1,450			1,383
Operating expenses		(613	)		(651	)		(652	)		(632	)		(651	)		(626	)		(625	)
General administrative expenses		(538	)		(571	)		(578	)		(554	)		(560	)		(538	)		(535	)
Personnel		(307	)		(335	)		(335	)		(317	)		(342	)		(326	)		(353	)
Other general administrative expenses		(231	)		(236	)		(243	)		(236	)		(218	)		(211	)		(182	)
Depreciation and amortisation		(76	)		(80	)		(74	)		(78	)		(91	)		(88	)		(90	)
Net operating income		936			968			969			862			854			825			759
Net loan-loss provisions		(268	)		(262	)		(221	)		(179	)		(138	)		(133	)		(161	)
Other income		(5	)		(2	)		(10	)		(89	)		(45	)		(879	)		(30	)
Profit before taxes		663			704			739			594			671			(187	)		568
Tax on profit		(181	)		(180	)		(216	)		(158	)		(180	)		43			(157	)
Profit from continuing operations		482			524			523			436			491			(144	)		411
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		482			524			523			436			491			(144	)		411
Minority interests		0			0			0			0			(0	)		0			(0	)
Attributable profit to the Group**		482			524			523			436			491			(144	)		411

*	Including dividends, income from equity-accounted method and other operating income/expenses
**	Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, Q2’11 profit was EUR 476 million

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans***		223,115		243,687		233,694		233,856		228,887		222,384		235,140
Trading portfolio (w/o loans)		46,078		49,731		51,969		45,187		40,965		46,625		49,693
Available-for-sale financial assets		908		987		942		204		36		48		1,108
Due from credit institutions***		33,311		22,402		37,912		29,137		32,981		28,860		36,776
Intangible assets and property and equipment		1,427		1,527		1,457		2,323		2,253		2,197		2,237
Other assets		23,114		41,476		42,281		42,063		47,514		47,292		43,549
Total assets/liabilities & shareholders’ equity		327,954		359,809		368,255		352,769		352,637		347,406		368,502
Customer deposits***		168,679		185,811		180,490		184,548		180,381		182,338		187,141
Marketable debt securities***		60,459		66,180		70,657		64,326		62,944		71,936		70,042
Subordinated debt***		8,703		9,395		8,364		8,143		7,352		7,283		7,939
Insurance liabilities		2		1		1		1		1		1		—
Due to credit institutions***		53,338		57,176		54,402		54,179		63,155		44,269		50,793
Other liabilities		29,373		33,160		41,453		29,811		26,358		29,385		39,947
Shareholders’ equity****		7,399		8,084		12,889		11,762		12,446		12,194		12,640
Other customer funds under management		11,923		13,203		13,704		14,369		14,204		14,532		14,686
Mutual funds		11,923		13,203		13,704		14,369		14,204		14,532		14,686
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		249,763		274,590		273,214		271,386		264,881		276,089		279,808

***	Including all on-balance sheet balances for this item
****	Not including profit of the year

Other information
NPL ratio	1.88		1.85		1.77		1.76		1.75		1.82		1.88
NPL coverage	46		46		48		46		45		41		40
Spread (Retail Banking)	1.99		1.99		2.03		2.03		2.04		1.97		1.96
Spread loans	2.05		2.13		2.20		2.28		2.34		2.35		2.42
Spread deposits	(0.06	)	(0.14	)	(0.17	)	(0.25	)	(0.30	)	(0.38	)	(0.45	)

United Kingdom
Million pound sterling

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		2,739			3,083			(345	)		(11.2	)
Net fees		700			677			23			3.4
Gains (losses) on financial transactions		326			326			0			0.1
Other operating income*		15			16			(1	)		(5.2	)
Gross income		3,780			4,102			(322	)		(7.9	)
Operating expenses		(1,656	)		(1,642	)		(14	)		0.9
General administrative expenses		(1,423	)		(1,444	)		22			(1.5	)
Personnel		(889	)		(837	)		(52	)		6.2
Other general administrative expenses		(533	)		(607	)		74			(12.2	)
Depreciation and amortisation		(233	)		(197	)		(36	)		18.4
Net operating income		2,123			2,460			(337	)		(13.7	)
Net loan-loss provisions		(376	)		(643	)		267			(41.5	)
Other income		(832	)		(14	)		(817	)		—
Profit before taxes		916			1,803			(887	)		(49.2	)
Tax on profit		(256	)		(493	)		237			(48.1	)
Profit from continuing operations		659			1,310			(650	)		(49.7	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		659			1,310			(650	)		(49.7	)
Minority interests		0			0			(0	)		(93.0	)
Attributable profit to the Group**		659			1,310			(650	)		(49.7	)

*	Including dividends, income from equity-accounted method and other operating income/expenses
**	Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, 2011 profit was sterling 1,198 million

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans***		203,784		200,965		2,818			1.4
Trading portfolio (w/o loans)		43,066		44,691		(1,625	)		(3.6	)
Available-for-sale financial assets		960		810		150			18.6
Due from credit institutions***		31,872		32,602		(730	)		(2.2	)
Intangible assets and property and equipment		1,938		1,253		685			54.6
Other assets		37,742		36,359		1,382			3.8
Total assets/liabilities & shareholders’ equity		319,362		316,681		2,681			0.8
Customer deposits***		162,186		155,212		6,974			4.5
Marketable debt securities***		60,702		60,761		(60	)		(0.1	)
Subordinated debt***		6,881		7,193		(312	)		(4.3	)
Insurance liabilities		—		1		(1	)		(100.0	)
Due to credit institutions***		44,019		46,783		(2,763	)		(5.9	)
Other liabilities		34,620		35,647		(1,027	)		(2.9	)
Shareholders’ equity****		10,954		11,084		(130	)		(1.2	)
Other customer funds under management		12,728		11,785		943			8.0
Mutual funds		12,728		11,785		943			8.0
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		—		—		—			—
Customer funds under management		242,496		234,950		7,545			3.2

***	Including all on-balance sheet balances for this item
****	Not including profit of the year

United Kingdom
Million pound sterling

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,030			1,028			1,025			1,001			948			902			889
Net fees		221			232			224			203			198			258			244
Gains (losses) on financial transactions		118			114			93			71			134			115			77
Other operating income*		5			6			5			10			5			6			4
Gross income		1,375			1,380			1,348			1,284			1,285			1,280			1,215
Operating expenses		(544	)		(555	)		(542	)		(543	)		(556	)		(552	)		(548	)
General administrative expenses		(477	)		(487	)		(481	)		(476	)		(478	)		(475	)		(470	)
Personnel		(272	)		(286	)		(279	)		(273	)		(292	)		(288	)		(309	)
Other general administrative expenses		(205	)		(201	)		(202	)		(203	)		(186	)		(187	)		(160	)
Depreciation and amortisation		(67	)		(68	)		(61	)		(67	)		(77	)		(77	)		(79	)
Net operating income		830			825			805			741			729			728			666
Net loan-loss provisions		(237	)		(223	)		(182	)		(154	)		(118	)		(117	)		(141	)
Other income		(5	)		(1	)		(8	)		(76	)		(39	)		(764	)		(29	)
Profit before taxes		588			600			615			511			572			(153	)		496
Tax on profit		(160	)		(153	)		(180	)		(136	)		(154	)		35			(137	)
Profit from continuing operations		428			447			435			375			419			(118	)		359
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		428			447			435			375			419			(118	)		359
Minority interests		0			0			0			0			(0	)		0			(0	)
Attributable profit to the Group**		428			447			435			374			419			(118	)		359

*	Including dividends, income from equity-accounted method and other operating income/expenses
**	Before the impact in the second quarter from the provision in relation to PPI remediation in the UK, Q2’11 profit was sterling 420 million

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans***		198,528		199,202		200,965		201,292		202,267		200,713		203,784
Trading portfolio (w/o loans)		41,000		40,652		44,691		38,894		36,201		42,081		43,066
Available-for-sale financial assets		808		807		810		175		32		43		960
Due from credit institutions***		29,640		18,312		32,602		25,080		29,146		26,048		31,872
Intangible assets and property and equipment		1,270		1,248		1,253		2,000		1,991		1,983		1,938
Other assets		20,567		33,905		36,359		36,205		41,988		42,684		37,742
Total assets/liabilities & shareholders’ equity		291,813		294,126		316,681		303,646		311,625		313,551		319,362
Customer deposits***		150,091		151,891		155,212		158,850		159,403		164,569		162,186
Marketable debt securities***		53,796		54,099		60,761		55,368		55,624		64,926		60,702
Subordinated debt***		7,744		7,680		7,193		7,009		6,497		6,573		6,881
Insurance liabilities		2		1		1		1		1		1		—
Due to credit institutions***		47,461		46,739		46,783		46,634		55,810		39,955		44,019
Other liabilities		26,136		27,107		35,647		25,660		23,293		26,521		34,620
Shareholders’ equity****		6,584		6,609		11,084		10,124		10,999		11,006		10,954
Other customer funds under management		10,609		10,793		11,785		12,368		12,552		13,116		12,728
Mutual funds		10,609		10,793		11,785		12,368		12,552		13,116		12,728
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		222,239		224,463		234,950		233,596		234,075		249,184		242,496

***	Including all on-balance sheet balances for this item
****	Not including profit of the year

Latin America
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		12,179			10,836			1,344			12.4
Net fees		3,786			3,444			342			9.9
Gains (losses) on financial transactions		959			1,053			(93	)		(8.9	)
Other operating income*		(57	)		(38	)		(20	)		51.9
Gross income		16,866			15,294			1,572			10.3
Operating expenses		(6,558	)		(5,875	)		(683	)		11.6
General administrative expenses		(5,885	)		(5,320	)		(565	)		10.6
Personnel		(3,298	)		(2,879	)		(419	)		14.5
Other general administrative expenses		(2,587	)		(2,441	)		(146	)		6.0
Depreciation and amortisation		(673	)		(555	)		(119	)		21.4
Net operating income		10,308			9,419			889			9.4
Net loan-loss provisions		(4,260	)		(3,542	)		(719	)		20.3
Other income		(716	)		(685	)		(32	)		4.7
Profit before taxes		5,332			5,193			138			2.7
Tax on profit		(1,254	)		(1,127	)		(127	)		11.3
Profit from continuing operations		4,077			4,066			11			0.3
Net profit from discontinued operations		—			—			—			—
Consolidated profit		4,077			4,066			11			0.3
Minority interests		549			641			(92	)		(14.3	)
Attributable profit to the Group		3,528			3,425			103			3.0

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		131,288		117,909		13,379			11.3
Trading portfolio (w/o loans)		36,144		34,487		1,657			4.8
Available-for-sale financial assets		26,604		27,263		(659	)		(2.4	)
Due from credit institutions**		24,282		23,121		1,161			5.0
Intangible assets and property and equipment		4,443		4,393		50			1.1
Other assets		55,828		50,868		4,960			9.8
Total assets/liabilities & shareholders’ equity		278,590		258,041		20,549			8.0
Customer deposits**		130,628		128,554		2,074			1.6
Marketable debt securities**		22,224		12,143		10,082			83.0
Subordinated debt**		5,658		5,357		301			5.6
Insurance liabilities		8,965		2,942		6,023			204.7
Due to credit institutions**		44,206		37,384		6,823			18.3
Other liabilities		46,931		50,053		(3,122	)		(6.2	)
Shareholders’ equity***		19,978		21,609		(1,631	)		(7.5	)
Other customer funds under management		70,913		67,839		3,074			4.5
Mutual funds		56,691		52,377		4,315			8.2
Pension funds		—		—		—			—
Managed portfolios		13,515		15,239		(1,725	)		(11.3	)
Savings-insurance policies		707		223		484			217.4
Customer funds under management		229,422		213,892		15,530			7.3

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	21.54	21.53	0.01 p.
Efficiency ratio (with amortisations)	38.9	38.4	0.5 p.
NPL ratio	4.10	4.15	(0.05 p.	)
NPL coverage	102	103	(1 p.	)
Number of employees (direct & indirect)	90,106	87,765	2,341		2.7
Number of branches	5,964	5,784	180		3.1

Latin America
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		3,355			3,712			3,768			3,843			3,988			4,053			4,137
Net fees		1,045			1,190			1,209			1,217			1,256			1,264			1,266
Gains (losses) on financial transactions		330			290			433			358			308			401			251
Other operating income*		3			(1	)		(39	)		(36	)		(4	)		(38	)		(16	)
Gross income		4,733			5,191			5,371			5,382			5,548			5,679			5,639
Operating expenses		(1,773	)		(2,021	)		(2,081	)		(2,096	)		(2,142	)		(2,163	)		(2,254	)
General administrative expenses		(1,606	)		(1,828	)		(1,886	)		(1,873	)		(1,926	)		(1,938	)		(2,021	)
Personnel		(862	)		(991	)		(1,026	)		(1,076	)		(1,094	)		(1,083	)		(1,120	)
Other general administrative expenses		(743	)		(837	)		(860	)		(797	)		(831	)		(855	)		(901	)
Depreciation and amortisation		(167	)		(192	)		(196	)		(223	)		(216	)		(225	)		(233	)
Net operating income		2,960			3,170			3,289			3,286			3,407			3,516			3,385
Net loan-loss provisions		(1,237	)		(1,247	)		(1,057	)		(1,146	)		(1,251	)		(1,474	)		(1,535	)
Other income		(257	)		(195	)		(232	)		(63	)		(227	)		(278	)		(211	)
Profit before taxes		1,466			1,728			2,000			2,077			1,929			1,764			1,639
Tax on profit		(278	)		(391	)		(459	)		(566	)		(456	)		(383	)		(415	)
Profit from continuing operations		1,188			1,337			1,541			1,511			1,473			1,381			1,224
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		1,188			1,337			1,541			1,511			1,473			1,381			1,224
Minority interests		186			216			238			209			203			193			153
Attributable profit to the Group		1,002			1,121			1,303			1,302			1,270			1,188			1,071

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10			30.09.10		31.12.10			31.03.11			30.06.11		30.09.11
Balance sheet
Customer loans**		102,150		116,605			117,909		127,268			124,691			132,095		131,288
Trading portfolio (w/o loans)		27,574		36,326			34,487		31,580			28,754			35,839		36,144
Available-for-sale financial assets		27,601		30,209			27,263		30,697			31,659			34,417		26,604
Due from credit institutions**		20,595		22,964			23,121		21,632			21,288			22,667		24,282
Intangible assets and property and equipment		4,129		4,500			4,393		4,880			4,669			4,766		4,443
Other assets		42,463		46,951			50,868		57,186			58,413			60,547		55,828
Total assets/liabilities & shareholders’ equity		224,511		257,555			258,041		273,243			269,474			290,331		278,590
Customer deposits**		115,979		127,886			128,554		137,848			135,034			138,596		130,628
Marketable debt securities**		8,547		10,086			12,143		15,376			18,681			22,495		22,224
Subordinated debt**		5,213		5,827			5,357		5,683			5,586			5,864		5,658
Insurance liabilities		5,208		4,573			2,942		9,515			9,431			9,809		8,965
Due to credit institutions**		29,640		43,160			37,384		38,103			38,597			47,058		44,206
Other liabilities		38,361		43,538			50,053		45,913			39,616			44,823		46,931
Shareholders’ equity***		21,563		22,484			21,609		20,805			22,527			21,687		19,978
Other customer funds under management		68,533		74,772			67,839		77,180			77,673			76,290		70,913
Mutual funds		54,446		58,546			52,377		61,621			63,588			62,433		56,691
Pension funds		—		(0	)		—		(0	)		(0	)		—		—
Managed portfolios		13,948		16,005			15,239		14,800			13,252			12,973		13,515
Savings-insurance policies		140		220			223		758			833			884		707
Customer funds under management		198,272		218,571			213,892		236,087			236,975			243,244		229,422

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	4.18	4.13	4.15	4.11	4.01	4.20	4.10
NPL coverage	107	105	103	104	107	105	102

Latin America
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		17,118			14,209			2,909			20.5
Net fees		5,321			4,516			805			17.8
Gains (losses) on financial transactions		1,348			1,380			(32	)		(2.3	)
Other operating income*		(81	)		(50	)		(31	)		62.8
Gross income		23,706			20,055			3,651			18.2
Operating expenses		(9,218	)		(7,703	)		(1,514	)		19.7
General administrative expenses		(8,271	)		(6,976	)		(1,295	)		18.6
Personnel		(4,635	)		(3,776	)		(860	)		22.8
Other general administrative expenses		(3,636	)		(3,201	)		(435	)		13.6
Depreciation and amortisation		(946	)		(727	)		(219	)		30.1
Net operating income		14,489			12,352			2,137			17.3
Net loan-loss provisions		(5,988	)		(4,644	)		(1,344	)		28.9
Other income		(1,007	)		(898	)		(109	)		12.2
Profit before taxes		7,494			6,810			683			10.0
Tax on profit		(1,763	)		(1,478	)		(285	)		19.3
Profit from continuing operations		5,731			5,332			398			7.5
Net profit from discontinued operations		—			—			—			—
Consolidated profit		5,731			5,332			398			7.5
Minority interests		772			841			(68	)		(8.1	)
Attributable profit to the Group		4,959			4,492			467			10.4

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		177,279		160,922		16,357			10.2
Trading portfolio (w/o loans)		48,805		47,068		1,737			3.7
Available-for-sale financial assets		35,923		37,208		(1,285	)		(3.5	)
Due from credit institutions**		32,788		31,555		1,233			3.9
Intangible assets and property and equipment		6,000		5,995		4			0.1
Other assets		75,385		69,425		5,960			8.6
Total assets/liabilities & shareholders’ equity		376,179		352,174		24,006			6.8
Customer deposits**		176,387		175,450		936			0.5
Marketable debt securities**		30,010		16,572		13,437			81.1
Subordinated debt**		7,639		7,311		328			4.5
Insurance liabilities		12,105		4,015		8,090			201.5
Due to credit institutions**		59,692		51,021		8,671			17.0
Other liabilities		63,372		68,313		(4,941	)		(7.2	)
Shareholders’ equity***		26,976		29,492		(2,516	)		(8.5	)
Other customer funds under management		95,753		92,586		3,167			3.4
Mutual funds		76,550		71,484		5,067			7.1
Pension funds		—		—		—			—
Managed portfolios		18,249		20,798		(2,550	)		(12.3	)
Savings-insurance policies		954		304		650			214.0
Customer funds under management		309,789		291,920		17,869			6.1

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Latin America
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		4,637			4,710			4,862			5,208			5,453			5,823			5,842
Net fees		1,444			1,512			1,560			1,650			1,717			1,816			1,788
Gains (losses) on financial transactions		455			364			561			485			421			572			355
Other operating income*		4			(2	)		(52	)		(48	)		(5	)		(54	)		(22	)
Gross income		6,540			6,584			6,932			7,295			7,586			8,158			7,963
Operating expenses		(2,450	)		(2,567	)		(2,687	)		(2,840	)		(2,928	)		(3,108	)		(3,182	)
General administrative expenses		(2,219	)		(2,323	)		(2,434	)		(2,539	)		(2,633	)		(2,785	)		(2,853	)
Personnel		(1,192	)		(1,260	)		(1,324	)		(1,456	)		(1,496	)		(1,557	)		(1,582	)
Other general administrative expenses		(1,027	)		(1,063	)		(1,110	)		(1,083	)		(1,137	)		(1,228	)		(1,272	)
Depreciation and amortisation		(230	)		(244	)		(253	)		(301	)		(295	)		(322	)		(328	)
Net operating income		4,091			4,017			4,245			4,455			4,658			5,050			4,781
Net loan-loss provisions		(1,710	)		(1,576	)		(1,358	)		(1,556	)		(1,710	)		(2,111	)		(2,167	)
Other income		(355	)		(243	)		(299	)		(91	)		(310	)		(398	)		(299	)
Profit before taxes		2,026			2,198			2,587			2,808			2,637			2,541			2,315
Tax on profit		(384	)		(500	)		(594	)		(762	)		(624	)		(553	)		(586	)
Profit from continuing operations		1,642			1,698			1,993			2,046			2,013			1,988			1,730
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		1,642			1,698			1,993			2,046			2,013			1,988			1,730
Minority interests		258			275			308			283			278			278			216
Attributable profit to the Group		1,384			1,423			1,685			1,762			1,736			1,710			1,513

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10			30.09.10		31.12.10			31.03.11			30.06.11		30.09.11
Balance sheet
Customer loans**		137,688		143,086			160,922		170,056			177,149			190,917		177,279
Trading portfolio (w/o loans)		37,167		44,576			47,068		42,197			40,851			51,798		48,805
Available-for-sale financial assets		37,203		37,069			37,208		41,017			44,978			49,743		35,923
Due from credit institutions**		27,759		28,179			31,555		28,904			30,244			32,761		32,788
Intangible assets and property and equipment		5,566		5,522			5,995		6,520			6,633			6,888		6,000
Other assets		57,236		57,613			69,425		76,412			82,987			87,509		75,385
Total assets/liabilities & shareholders’ equity		302,619		316,045			352,174		365,107			382,841			419,616		376,179
Customer deposits**		156,328		156,928			175,450		184,192			191,843			200,313		176,387
Marketable debt securities**		11,521		12,377			16,572		20,545			26,541			32,512		30,010
Subordinated debt**		7,026		7,151			7,311		7,593			7,936			8,475		7,639
Insurance liabilities		7,020		5,611			4,015		12,714			13,399			14,177		12,105
Due to credit institutions**		39,952		52,962			51,021		50,913			54,835			68,012		59,692
Other liabilities		51,707		53,426			68,313		61,349			56,283			64,783		63,372
Shareholders’ equity***		29,065		27,590			29,492		27,800			32,005			31,344		26,976
Other customer funds under management		92,376		91,752			92,586		103,128			110,350			110,262		95,753
Mutual funds		73,387		71,842			71,484		82,338			90,340			90,234		76,550
Pension funds		—		(0	)		—		(0	)		(0	)		—		—
Managed portfolios		18,800		19,640			20,798		19,776			18,827			18,749		18,249
Savings-insurance policies		189		270			304		1,013			1,184			1,278		954
Customer funds under management		267,251		268,208			291,920		315,459			336,670			351,561		309,789

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Latin America. Results
Million euros

	Gross income					Net operating income						Attributable profit to the Group
	9M ’11		Var. (%)			9M ’11			Var. (%)			9M ’11			Var. (%)			9M ’11
Brazil		11,989		13.9			7,579			14.6			1,973			(4.4	)		2,813.7
Mexico		1,823		1.1			1,097			(2.2	)		731			57.0			664.1
Chile		1,559		3.0			952			(2.3	)		466			(3.4	)		671.4
Argentina		668		11.3			342			5.7			205			(4.2	)		295.3
Uruguay		119		(11.4	)		28			(57.6	)		13			(76.4	)		67.0
Colombia		148		6.8			63			8.3			30			9.0			40.6
Puerto Rico		255		(8.0	)		131			(9.8	)		26			(0.8	)		37.7
Rest		87		(3.6	)		(8	)		—			(23	)		81.4			(1.3	)
Subtotal		16,647		10.4			10,184			9.5			3,422			3.0			4,588.4
Santander Private Banking		219		5.0			125			6.5			106			1.9			139.5
Total		16,866		10.3			10,308			9.4			3,528			3.0			4,727.9

Latin America. Results
Million dollars

	Gross income					Net operating income						Attributable profit to the Group
	9M ’11		Var. (%)			9M ’11			Var. (%)			9M ’11			Var. (%)
Brazil		16,851		22.1			10,653			22.8			2,773			2.5
Mexico		2,562		8.3			1,543			4.8			1,028			68.3
Chile		2,192		10.4			1,338			4.7			655			3.5
Argentina		939		19.3			480			13.3			288			2.7
Uruguay		167		(5.1	)		39			(54.5	)		18			(74.7	)
Colombia		208		14.5			88			16.1			42			16.8
Puerto Rico		358		(1.4	)		183			(3.4	)		37			6.3
Rest		122		3.3			(11	)		—			(32	)		94.4
Subtotal		23,398		18.3			14,313			17.3			4,810			10.4
Santander Private Banking		308		12.6			175			14.1			149			9.3
Total		23,706		18.2			14,489			17.3			4,959			10.4

Brazil
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		8,928			7,681			1,247			16.2
Net fees		2,476			2,228			247			11.1
Gains (losses) on financial transactions		691			677			14			2.0
Other operating income*		(106	)		(60	)		(46	)		77.1
Gross income		11,989			10,527			1,462			13.9
Operating expenses		(4,410	)		(3,913	)		(497	)		12.7
General administrative expenses		(3,939	)		(3,552	)		(387	)		10.9
Personnel		(2,167	)		(1,872	)		(295	)		15.7
Other general administrative expenses		(1,772	)		(1,680	)		(92	)		5.5
Depreciation and amortisation		(471	)		(360	)		(110	)		30.6
Net operating income		7,579			6,615			965			14.6
Net loan-loss provisions		(3,539	)		(2,772	)		(767	)		27.7
Other income		(792	)		(629	)		(163	)		25.9
Profit before taxes		3,248			3,213			34			1.1
Tax on profit		(861	)		(771	)		(90	)		11.7
Profit from continuing operations		2,387			2,443			(56	)		(2.3	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		2,387			2,443			(56	)		(2.3	)
Minority interests		414			380			34			9.0
Attributable profit to the Group		1,973			2,063			(90	)		(4.4	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		71,736		65,064		6,672			10.3
Trading portfolio (w/o loans)		13,327		10,511		2,816			26.8
Available-for-sale financial assets		18,221		17,506		715			4.1
Due from credit institutions**		9,818		11,270		(1,452	)		(12.9	)
Intangible assets and property and equipment		3,469		3,419		49			1.4
Other assets		42,127		38,203		3,924			10.3
Total assets/liabilities & shareholders’ equity		158,697		145,973		12,723			8.7
Customer deposits**		71,211		73,829		(2,618	)		(3.5	)
Marketable debt securities**		15,379		6,596		8,782			133.1
Subordinated debt**		4,230		4,065		164			4.0
Insurance liabilities		8,178		2,333		5,845			250.6
Due to credit institutions**		24,777		21,239		3,537			16.7
Other liabilities		24,800		25,762		(962	)		(3.7	)
Shareholders’ equity***		10,123		12,149		(2,026	)		(16.7	)
Other customer funds under management		44,481		39,422		5,059			12.8
Mutual funds		40,623		35,300		5,322			15.1
Pension funds		—		—		—			—
Managed portfolios		3,449		4,062		(613	)		(15.1	)
Savings-insurance policies		410		60		350			580.7
Customer funds under management		135,300		123,912		11,388			9.2

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	22.99	22.11	0.88 p.
Efficiency ratio (with amortisations)	36.8	37.2	(0.4 p.	)
NPL ratio	5.05	4.97	0.08 p.
NPL coverage	100	98	2 p.
Number of employees (direct & indirect)	52,433	52,296	137		0.3
Number of branches	3,731	3,623	108		3.0

Brazil
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,378			2,612			2,692			2,779			2,938			2,962			3,028
Net fees		671			768			789			773			810			840			826
Gains (losses) on financial transactions		179			209			289			298			195			277			219
Other operating income*		4			(19	)		(46	)		(54	)		(17	)		(59	)		(30	)
Gross income		3,232			3,571			3,725			3,796			3,926			4,019			4,043
Operating expenses		(1,178	)		(1,341	)		(1,393	)		(1,403	)		(1,450	)		(1,454	)		(1,505	)
General administrative expenses		(1,070	)		(1,219	)		(1,263	)		(1,255	)		(1,303	)		(1,295	)		(1,342	)
Personnel		(560	)		(640	)		(672	)		(720	)		(727	)		(707	)		(733	)
Other general administrative expenses		(511	)		(579	)		(591	)		(535	)		(575	)		(588	)		(609	)
Depreciation and amortisation		(108	)		(122	)		(131	)		(148	)		(148	)		(159	)		(163	)
Net operating income		2,053			2,230			2,331			2,393			2,476			2,566			2,538
Net loan-loss provisions		(946	)		(980	)		(846	)		(937	)		(1,046	)		(1,255	)		(1,239	)
Other income		(230	)		(181	)		(218	)		(117	)		(232	)		(274	)		(287	)
Profit before taxes		877			1,069			1,267			1,339			1,199			1,037			1,012
Tax on profit		(174	)		(262	)		(335	)		(429	)		(309	)		(251	)		(301	)
Profit from continuing operations		703			807			933			910			889			787			711
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		703			807			933			910			889			787			711
Minority interests		106			121			153			159			157			138			119
Attributable profit to the Group		597			686			780			751			732			649			592

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		56,616		64,495		65,064		71,027		69,447		73,320		71,736
Trading portfolio (w/o loans)		9,823		16,495		10,511		11,529		10,567		14,407		13,327
Available-for-sale financial assets		15,911		19,731		17,506		21,257		22,584		24,596		18,221
Due from credit institutions**		9,387		10,167		11,270		10,863		10,966		10,134		9,818
Intangible assets and property and equipment		3,119		3,470		3,419		3,813		3,679		3,773		3,469
Other assets		28,918		34,274		38,203		41,775		40,534		44,696		42,127
Total assets/liabilities & shareholders’ equity		123,775		148,631		145,973		160,264		157,776		170,927		158,697
Customer deposits**		63,066		71,466		73,829		75,669		75,605		78,188		71,211
Marketable debt securities**		4,675		5,540		6,596		9,164		11,780		14,553		15,379
Subordinated debt**		4,099		4,566		4,065		4,372		4,325		4,547		4,230
Insurance liabilities		4,697		3,960		2,333		8,857		8,679		8,980		8,178
Due to credit institutions**		13,390		26,551		21,239		24,233		22,091		27,218		24,777
Other liabilities		21,218		23,155		25,762		26,362		23,612		25,954		24,800
Shareholders’ equity***		12,631		13,393		12,149		11,608		11,684		11,488		10,123
Other customer funds under management		40,968		44,614		39,422		48,727		50,822		49,756		44,481
Mutual funds		37,526		40,476		35,300		43,942		46,705		45,397		40,623
Pension funds		—		—		—		—		—		—		—
Managed portfolios		3,442		4,084		4,062		4,205		3,568		3,791		3,449
Savings-insurance policies		—		55		60		580		549		567		410
Customer funds under management		112,807		126,186		123,912		137,931		142,533		147,043		135,300

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	5.04	5.01	4.97	4.91	4.85	5.05	5.05
NPL coverage	100	98	98	101	104	102	100
Spread (Retail Banking)	16.13	16.23	15.81	15.42	15.84	16.17	15.41
Spread loans	15.26	15.29	14.73	14.29	14.72	15.05	14.23
Spread deposits	0.87	0.94	1.08	1.13	1.12	1.12	1.18

Brazil
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		12,549			10,073			2,476			24.6
Net fees		3,480			2,922			558			19.1
Gains (losses) on financial transactions		971			888			83			9.3
Other operating income*		(149	)		(79	)		(71	)		89.9
Gross income		16,851			13,805			3,046			22.1
Operating expenses		(6,198	)		(5,131	)		(1,067	)		20.8
General administrative expenses		(5,536	)		(4,658	)		(878	)		18.9
Personnel		(3,045	)		(2,455	)		(590	)		24.1
Other general administrative expenses		(2,491	)		(2,203	)		(288	)		13.1
Depreciation and amortisation		(661	)		(473	)		(189	)		40.0
Net operating income		10,653			8,674			1,979			22.8
Net loan-loss provisions		(4,975	)		(3,635	)		(1,340	)		36.9
Other income		(1,113	)		(825	)		(288	)		34.9
Profit before taxes		4,565			4,214			351			8.3
Tax on profit		(1,210	)		(1,011	)		(199	)		19.7
Profit from continuing operations		3,355			3,203			152			4.7
Net profit from discontinued operations		—			—			—			—
Consolidated profit		3,355			3,203			152			4.7
Minority interests		582			498			84			16.8
Attributable profit to the Group		2,773			2,705			68			2.5

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		96,865		88,800		8,065			9.1
Trading portfolio (w/o loans)		17,996		14,346		3,650			25.4
Available-for-sale financial assets		24,604		23,892		712			3.0
Due from credit institutions**		13,257		15,381		(2,124	)		(13.8	)
Intangible assets and property and equipment		4,684		4,667		17			0.4
Other assets		56,883		52,139		4,744			9.1
Total assets/liabilities & shareholders’ equity		214,288		199,224		15,064			7.6
Customer deposits**		96,156		100,761		(4,606	)		(4.6	)
Marketable debt securities**		20,766		9,002		11,763			130.7
Subordinated debt**		5,711		5,548		163			2.9
Insurance liabilities		11,043		3,184		7,859			246.9
Due to credit institutions**		33,456		28,987		4,468			15.4
Other liabilities		33,488		35,160		(1,672	)		(4.8	)
Shareholders’ equity***		13,669		16,581		(2,912	)		(17.6	)
Other customer funds under management		60,063		53,803		6,260			11.6
Mutual funds		54,853		48,178		6,675			13.9
Pension funds		—		—		—			—
Managed portfolios		4,657		5,543		(887	)		(16.0	)
Savings-insurance policies		554		82		471			573.4
Customer funds under management		182,696		169,115		13,580			8.0

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Brazil
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		3,286			3,313			3,474			3,765			4,018			4,256			4,275
Net fees		927			976			1,019			1,048			1,108			1,206			1,166
Gains (losses) on financial transactions		247			266			375			402			266			395			310
Other operating income*		6			(25	)		(60	)		(72	)		(23	)		(84	)		(42	)
Gross income		4,466			4,531			4,808			5,142			5,368			5,773			5,709
Operating expenses		(1,628	)		(1,703	)		(1,799	)		(1,901	)		(1,983	)		(2,089	)		(2,125	)
General administrative expenses		(1,479	)		(1,549	)		(1,630	)		(1,700	)		(1,781	)		(1,861	)		(1,895	)
Personnel		(774	)		(814	)		(868	)		(973	)		(994	)		(1,017	)		(1,034	)
Other general administrative expenses		(706	)		(735	)		(762	)		(727	)		(787	)		(844	)		(860	)
Depreciation and amortisation		(149	)		(155	)		(169	)		(200	)		(202	)		(228	)		(231	)
Net operating income		2,838			2,827			3,009			3,241			3,385			3,684			3,584
Net loan-loss provisions		(1,308	)		(1,240	)		(1,088	)		(1,271	)		(1,430	)		(1,796	)		(1,749	)
Other income		(318	)		(226	)		(282	)		(162	)		(317	)		(392	)		(405	)
Profit before taxes		1,212			1,362			1,640			1,808			1,639			1,497			1,430
Tax on profit		(240	)		(336	)		(434	)		(576	)		(423	)		(362	)		(425	)
Profit from continuing operations		972			1,025			1,206			1,232			1,216			1,134			1,005
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		972			1,025			1,206			1,232			1,216			1,134			1,005
Minority interests		146			154			198			215			215			199			168
Attributable profit to the Group		826			871			1,008			1,017			1,001			935			837

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		76,313		79,141		88,800		94,907		98,663		105,970		96,865
Trading portfolio (w/o loans)		13,240		20,240		14,346		15,405		15,012		20,822		17,996
Available-for-sale financial assets		21,447		24,212		23,892		28,404		32,085		35,548		24,604
Due from credit institutions**		12,653		12,476		15,381		14,515		15,580		14,647		13,257
Intangible assets and property and equipment		4,204		4,258		4,667		5,095		5,227		5,454		4,684
Other assets		38,979		42,058		52,139		55,820		57,586		64,600		56,883
Total assets/liabilities & shareholders’ equity		166,836		182,385		199,224		214,144		224,153		247,041		214,288
Customer deposits**		85,006		87,696		100,761		101,108		107,412		113,005		96,156
Marketable debt securities**		6,301		6,798		9,002		12,245		16,736		21,033		20,766
Subordinated debt**		5,525		5,603		5,548		5,841		6,145		6,572		5,711
Insurance liabilities		6,331		4,859		3,184		11,835		12,330		12,979		11,043
Due to credit institutions**		18,048		32,581		28,987		32,380		31,384		39,338		33,456
Other liabilities		28,600		28,414		35,160		35,225		33,546		37,511		33,488
Shareholders’ equity***		17,025		16,434		16,581		15,510		16,599		16,604		13,669
Other customer funds under management		55,221		54,746		53,803		65,108		72,203		71,912		60,063
Mutual funds		50,581		49,668		48,178		58,715		66,354		65,613		54,853
Pension funds		—		—		—		—		—		—		—
Managed portfolios		4,640		5,011		5,543		5,618		5,069		5,479		4,657
Savings-insurance policies		—		67		82		775		779		820		554
Customer funds under management		152,053		154,843		169,115		184,303		202,497		212,521		182,696

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Brazil
Million brazilian real

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		20,470			17,934			2,537			14.1
Net fees		5,676			5,203			474			9.1
Gains (losses) on financial transactions		1,584			1,582			3			0.2
Other operating income*		(243	)		(140	)		(103	)		73.9
Gross income		27,488			24,578			2,910			11.8
Operating expenses		(10,110	)		(9,135	)		(975	)		10.7
General administrative expenses		(9,031	)		(8,293	)		(738	)		8.9
Personnel		(4,968	)		(4,371	)		(597	)		13.7
Other general administrative expenses		(4,063	)		(3,923	)		(141	)		3.6
Depreciation and amortisation		(1,079	)		(841	)		(238	)		28.2
Net operating income		17,378			15,443			1,934			12.5
Net loan-loss provisions		(8,115	)		(6,472	)		(1,643	)		25.4
Other income		(1,816	)		(1,469	)		(347	)		23.6
Profit before taxes		7,446			7,502			(56	)		(0.7	)
Tax on profit		(1,974	)		(1,799	)		(174	)		9.7
Profit from continuing operations		5,473			5,703			(230	)		(4.0	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		5,473			5,703			(230	)		(4.0	)
Minority interests		949			887			62			7.0
Attributable profit to the Group		4,523			4,816			(293	)		(6.1	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		179,820		150,956		28,865			19.1
Trading portfolio (w/o loans)		33,407		24,387		9,020			37.0
Available-for-sale financial assets		45,674		40,615		5,059			12.5
Due from credit institutions**		24,610		26,147		(1,537	)		(5.9	)
Intangible assets and property and equipment		8,695		7,934		762			9.6
Other assets		105,599		88,635		16,964			19.1
Total assets/liabilities & shareholders’ equity		397,805		338,672		59,133			17.5
Customer deposits**		178,504		171,290		7,214			4.2
Marketable debt securities**		38,549		15,304		23,246			151.9
Subordinated debt**		10,603		9,432		1,170			12.4
Insurance liabilities		20,500		5,412		15,088			278.8
Due to credit institutions**		62,107		49,277		12,830			26.0
Other liabilities		62,167		59,771		2,397			4.0
Shareholders’ equity***		25,374		28,187		(2,812	)		(10.0	)
Other customer funds under management		111,501		91,463		20,038			21.9
Mutual funds		101,829		81,900		19,929			24.3
Pension funds		—		—		—			—
Managed portfolios		8,644		9,423		(779	)		(8.3	)
Savings-insurance policies		1,028		140		888			635.4
Customer funds under management		339,157		287,489		51,668			18.0

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Brazil
Million brazilian real

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		5,920			5,939			6,075			6,400			6,696			6,799			6,974
Net fees		1,671			1,749			1,782			1,778			1,847			1,927			1,902
Gains (losses) on financial transactions		445			478			659			687			444			635			506
Other operating income*		11			(45	)		(106	)		(125	)		(39	)		(136	)		(68	)
Gross income		8,047			8,121			8,410			8,739			8,948			9,226			9,314
Operating expenses		(2,934	)		(3,054	)		(3,147	)		(3,230	)		(3,305	)		(3,337	)		(3,467	)
General administrative expenses		(2,666	)		(2,776	)		(2,851	)		(2,888	)		(2,968	)		(2,972	)		(3,091	)
Personnel		(1,394	)		(1,459	)		(1,518	)		(1,658	)		(1,657	)		(1,623	)		(1,687	)
Other general administrative expenses		(1,272	)		(1,318	)		(1,333	)		(1,230	)		(1,311	)		(1,349	)		(1,404	)
Depreciation and amortisation		(269	)		(277	)		(296	)		(342	)		(337	)		(365	)		(376	)
Net operating income		5,113			5,068			5,263			5,509			5,643			5,889			5,846
Net loan-loss provisions		(2,357	)		(2,222	)		(1,894	)		(2,156	)		(2,383	)		(2,878	)		(2,854	)
Other income		(573	)		(404	)		(492	)		(267	)		(528	)		(628	)		(660	)
Profit before taxes		2,183			2,442			2,877			3,087			2,731			2,383			2,332
Tax on profit		(432	)		(604	)		(764	)		(990	)		(705	)		(576	)		(693	)
Profit from continuing operations		1,751			1,838			2,114			2,096			2,027			1,807			1,639
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		1,751			1,838			2,114			2,096			2,027			1,807			1,639
Minority interests		263			276			347			367			358			317			274
Attributable profit to the Group		1,488			1,562			1,766			1,729			1,668			1,489			1,366

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		136,122		142,417		150,956		157,517		160,130		165,711		179,820
Trading portfolio (w/o loans)		23,617		36,423		24,387		25,567		24,365		32,561		33,407
Available-for-sale financial assets		38,255		43,570		40,615		47,142		52,074		55,588		45,674
Due from credit institutions**		22,570		22,450		26,147		24,090		25,286		22,905		24,610
Intangible assets and property and equipment		7,498		7,662		7,934		8,456		8,484		8,528		8,695
Other assets		69,529		75,684		88,635		92,644		93,462		101,018		105,599
Total assets/liabilities & shareholders’ equity		297,591		328,206		338,672		355,417		363,800		386,312		397,805
Customer deposits**		151,629		157,811		171,290		167,810		174,331		176,713		178,504
Marketable debt securities**		11,239		12,234		15,304		20,322		27,162		32,890		38,549
Subordinated debt**		9,855		10,082		9,432		9,695		9,974		10,276		10,603
Insurance liabilities		11,293		8,743		5,412		19,643		20,011		20,295		20,500
Due to credit institutions**		32,193		58,631		49,277		53,741		50,937		61,515		62,107
Other liabilities		51,014		51,131		59,771		58,463		54,445		58,658		62,167
Shareholders’ equity***		30,369		29,574		28,187		25,742		26,941		25,964		25,374
Other customer funds under management		98,500		98,517		91,463		108,061		117,186		112,453		111,501
Mutual funds		90,224		89,379		81,900		97,450		107,693		102,603		101,829
Pension funds		—		—		—		—		—		—		—
Managed portfolios		8,276		9,017		9,423		9,325		8,228		8,568		8,644
Savings-insurance policies		—		121		140		1,286		1,265		1,282		1,028
Customer funds under management		271,223		278,644		287,489		305,889		328,653		332,332		339,157

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Mexico
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,255			1,220			35			2.9
Net fees		461			427			34			7.9
Gains (losses) on financial transactions		102			165			(63	)		(38.2	)
Other operating income*		5			(8	)		14			—
Gross income		1,823			1,804			19			1.1
Operating expenses		(725	)		(681	)		(44	)		6.5
General administrative expenses		(644	)		(602	)		(42	)		7.1
Personnel		(350	)		(318	)		(32	)		10.1
Other general administrative expenses		(294	)		(284	)		(10	)		3.6
Depreciation and amortisation		(81	)		(80	)		(2	)		1.9
Net operating income		1,097			1,122			(25	)		(2.2	)
Net loan-loss provisions		(252	)		(360	)		107			(29.9	)
Other income		53			(39	)		93			—
Profit before taxes		899			723			175			24.2
Tax on profit		(166	)		(128	)		(38	)		29.9
Profit from continuing operations		732			595			137			23.0
Net profit from discontinued operations		—			—			—			—
Consolidated profit		732			595			137			23.0
Minority interests		1			130			(128	)		(99.2	)
Attributable profit to the Group		731			466			266			57.0

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		17,477		14,346		3,131			21.8
Trading portfolio (w/o loans)		14,377		14,524		(147	)		(1.0	)
Available-for-sale financial assets		2,514		4,010		(1,496	)		(37.3	)
Due from credit institutions**		7,462		6,640		822			12.4
Intangible assets and property and equipment		339		372		(33	)		(8.8	)
Other assets		3,890		3,926		(36	)		(0.9	)
Total assets/liabilities & shareholders’ equity		46,058		43,816		2,242			5.1
Customer deposits**		19,615		19,356		258			1.3
Marketable debt securities**		1,504		378		1,127			298.1
Subordinated debt**		—		—		—			—
Insurance liabilities		428		295		133			45.2
Due to credit institutions**		10,009		8,615		1,394			16.2
Other liabilities		10,253		10,943		(689	)		(6.3	)
Shareholders’ equity***		4,248		4,230		19			0.4
Other customer funds under management		9,765		10,114		(349	)		(3.5	)
Mutual funds		9,545		10,009		(464	)		(4.6	)
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		220		105		115			109.0
Customer funds under management		30,884		29,848		1,036			3.5

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	21.56	18.94	2.62 p.
Efficiency ratio (with amortisations)	39.8	37.8	2.0 p.
NPL ratio	1.78	2.20	(0.42 p.	)
NPL coverage	176	199	(23 p.	)
Number of employees (direct & indirect)	12,997	12,435	562		4.5
Number of branches	1,099	1,093	6		0.5

Mexico
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		383			430			406			394			406			414			435
Net fees		134			149			144			141			159			147			154
Gains (losses) on financial transactions		64			34			68			12			49			61			(8	)
Other operating income*		(7	)		4			(5	)		5			(0	)		4			2
Gross income		574			617			613			552			614			625			584
Operating expenses		(211	)		(234	)		(236	)		(241	)		(231	)		(241	)		(253	)
General administrative expenses		(187	)		(204	)		(210	)		(213	)		(204	)		(214	)		(227	)
Personnel		(100	)		(108	)		(110	)		(112	)		(118	)		(117	)		(115	)
Other general administrative expenses		(88	)		(96	)		(100	)		(101	)		(86	)		(97	)		(112	)
Depreciation and amortisation		(24	)		(30	)		(26	)		(27	)		(27	)		(27	)		(27	)
Net operating income		363			383			377			311			383			384			330
Net loan-loss provisions		(133	)		(124	)		(103	)		(109	)		(63	)		(93	)		(95	)
Other income		(10	)		(21	)		(9	)		10			(6	)		(1	)		60
Profit before taxes		220			239			265			213			314			290			295
Tax on profit		(31	)		(52	)		(45	)		(14	)		(57	)		(59	)		(50	)
Profit from continuing operations		189			187			219			199			256			231			245
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		189			187			219			199			256			231			245
Minority interests		46			47			36			0			0			0			0
Attributable profit to the Group		142			140			183			198			256			230			245

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		12,546		14,334		14,346		15,156		15,907		17,722		17,477
Trading portfolio (w/o loans)		10,513		12,356		14,524		13,004		12,232		14,772		14,377
Available-for-sale financial assets		5,059		4,604		4,010		3,716		3,272		2,775		2,514
Due from credit institutions**		6,134		6,407		6,640		4,478		3,739		5,795		7,462
Intangible assets and property and equipment		399		407		372		401		382		374		339
Other assets		4,070		4,319		3,926		4,394		4,120		4,820		3,890
Total assets/liabilities & shareholders’ equity		38,721		42,427		43,816		41,148		39,651		46,257		46,058
Customer deposits**		17,777		19,317		19,356		21,144		20,528		20,824		19,615
Marketable debt securities**		416		485		378		363		1,202		2,209		1,504
Subordinated debt**		56		66		—		—		—		—		—
Insurance liabilities		260		320		295		303		415		456		428
Due to credit institutions**		8,617		7,804		8,615		7,507		5,873		9,460		10,009
Other liabilities		8,329		10,977		10,943		7,840		6,939		8,792		10,253
Shareholders’ equity***		3,266		3,459		4,230		3,991		4,693		4,516		4,248
Other customer funds under management		9,901		10,822		10,114		10,114		10,481		10,933		9,765
Mutual funds		9,801		10,709		10,009		10,005		10,257		10,698		9,545
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		100		112		105		109		224		235		220
Customer funds under management		28,150		30,690		29,848		31,622		32,211		33,966		30,884

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	1.86	1.77	2.20	1.84	1.58	2.45	1.78
NPL coverage	268	257	199	215	234	165	176
Spread (Retail Banking)	12.08	11.42	11.23	10.98	10.67	10.44	10.26
Spread loans	10.03	9.50	9.20	8.93	8.58	8.40	8.27
Spread deposits	2.05	1.92	2.03	2.05	2.09	2.04	1.99

Mexico
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,764			1,600			164			10.3
Net fees		647			560			88			15.7
Gains (losses) on financial transactions		144			217			(73	)		(33.8	)
Other operating income*		8			(11	)		18			—
Gross income		2,562			2,365			197			8.3
Operating expenses		(1,019	)		(893	)		(126	)		14.1
General administrative expenses		(905	)		(789	)		(116	)		14.7
Personnel		(492	)		(416	)		(75	)		18.0
Other general administrative expenses		(414	)		(372	)		(41	)		11.1
Depreciation and amortisation		(114	)		(105	)		(10	)		9.2
Net operating income		1,543			1,472			71			4.8
Net loan-loss provisions		(354	)		(472	)		117			(24.8	)
Other income		75			(52	)		127			—
Profit before taxes		1,263			948			315			33.2
Tax on profit		(234	)		(168	)		(66	)		39.2
Profit from continuing operations		1,029			781			249			31.9
Net profit from discontinued operations		—			—			—			—
Consolidated profit		1,029			781			249			31.9
Minority interests		1			170			(168	)		(99.1	)
Attributable profit to the Group		1,028			611			417			68.3

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		23,599		19,579		4,020			20.5
Trading portfolio (w/o loans)		19,413		19,822		(409	)		(2.1	)
Available-for-sale financial assets		3,394		5,473		(2,078	)		(38.0	)
Due from credit institutions**		10,076		9,062		1,014			11.2
Intangible assets and property and equipment		458		507		(50	)		(9.8	)
Other assets		5,252		5,358		(106	)		(2.0	)
Total assets/liabilities & shareholders’ equity		62,192		59,801		2,391			4.0
Customer deposits**		26,486		26,418		68			0.3
Marketable debt securities**		2,032		516		1,516			293.9
Subordinated debt**		—		—		—			—
Insurance liabilities		578		403		176			43.6
Due to credit institutions**		13,515		11,757		1,758			15.0
Other liabilities		13,845		14,935		(1,090	)		(7.3	)
Shareholders’ equity***		5,736		5,773		(36	)		(0.6	)
Other customer funds under management		13,185		13,803		(618	)		(4.5	)
Mutual funds		12,889		13,660		(771	)		(5.6	)
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		297		143		153			106.7
Customer funds under management		41,702		40,737		966			2.4

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Mexico
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		529			546			524			536			555			594			614
Net fees		185			189			186			191			218			212			217
Gains (losses) on financial transactions		88			41			88			17			67			87			(11	)
Other operating income*		(10	)		6			(7	)		7			(0	)		5			3
Gross income		793			782			791			751			839			898			824
Operating expenses		(292	)		(297	)		(305	)		(326	)		(316	)		(346	)		(358	)
General administrative expenses		(259	)		(259	)		(271	)		(289	)		(279	)		(307	)		(320	)
Personnel		(138	)		(137	)		(142	)		(152	)		(161	)		(168	)		(162	)
Other general administrative expenses		(121	)		(122	)		(129	)		(137	)		(118	)		(138	)		(158	)
Depreciation and amortisation		(33	)		(38	)		(34	)		(37	)		(37	)		(39	)		(38	)
Net operating income		501			485			486			425			523			552			467
Net loan-loss provisions		(183	)		(156	)		(133	)		(148	)		(87	)		(133	)		(135	)
Other income		(14	)		(27	)		(11	)		13			(8	)		(2	)		84
Profit before taxes		304			303			342			290			429			417			417
Tax on profit		(43	)		(66	)		(59	)		(20	)		(78	)		(85	)		(70	)
Profit from continuing operations		261			236			283			270			351			332			346
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		261			236			283			270			351			332			346
Minority interests		64			60			46			2			1			0			0
Attributable profit to the Group		197			177			237			268			350			332			346

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		16,910		17,589		19,579		20,252		22,599		25,614		23,599
Trading portfolio (w/o loans)		14,170		15,161		19,822		17,376		17,378		21,351		19,413
Available-for-sale financial assets		6,819		5,650		5,473		4,965		4,648		4,010		3,394
Due from credit institutions**		8,268		7,862		9,062		5,983		5,312		8,375		10,076
Intangible assets and property and equipment		538		500		507		535		542		540		458
Other assets		5,486		5,300		5,358		5,871		5,853		6,966		5,252
Total assets/liabilities & shareholders’ equity		52,192		52,062		59,801		54,982		56,332		66,856		62,192
Customer deposits**		23,962		23,704		26,418		28,253		29,165		30,097		26,486
Marketable debt securities**		561		595		516		485		1,708		3,193		2,032
Subordinated debt**		75		81		—		—		—		—		—
Insurance liabilities		350		392		403		404		590		659		578
Due to credit institutions**		11,615		9,576		11,757		10,031		8,344		13,673		13,515
Other liabilities		11,227		13,469		14,935		10,476		9,858		12,707		13,845
Shareholders’ equity***		4,402		4,245		5,773		5,333		6,668		6,528		5,736
Other customer funds under management		13,345		13,279		13,803		13,515		14,890		15,802		13,185
Mutual funds		13,210		13,142		13,660		13,369		14,573		15,462		12,889
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		135		138		143		146		318		340		297
Customer funds under management		37,943		37,659		40,737		42,253		45,763		49,092		41,702

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Mexico
Million new mexican peso

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		21,217			20,330			888			4.4
Net fees		7,787			7,112			675			9.5
Gains (losses) on financial transactions		1,726			2,754			(1,027	)		(37.3	)
Other operating income*		91			(136	)		227			—
Gross income		30,821			30,059			762			2.5
Operating expenses		(12,264	)		(11,355	)		(909	)		8.0
General administrative expenses		(10,889	)		(10,025	)		(864	)		8.6
Personnel		(5,913	)		(5,293	)		(620	)		11.7
Other general administrative expenses		(4,976	)		(4,732	)		(244	)		5.2
Depreciation and amortisation		(1,375	)		(1,330	)		(45	)		3.4
Net operating income		18,557			18,705			(147	)		(0.8	)
Net loan-loss provisions		(4,264	)		(5,994	)		1,729			(28.9	)
Other income		902			(657	)		1,559			—
Profit before taxes		15,195			12,053			3,141			26.1
Tax on profit		(2,811	)		(2,133	)		(678	)		31.8
Profit from continuing operations		12,383			9,920			2,463			24.8
Net profit from discontinued operations		—			—			—			—
Consolidated profit		12,383			9,920			2,463			24.8
Minority interests		18			2,158			(2,141	)		(99.2	)
Attributable profit to the Group		12,366			7,762			4,604			59.3

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		324,961		245,681		79,280			32.3
Trading portfolio (w/o loans)		267,312		248,727		18,585			7.5
Available-for-sale financial assets		46,739		68,671		(21,932	)		(31.9	)
Due from credit institutions**		138,749		113,715		25,034			22.0
Intangible assets and property and equipment		6,303		6,366		(63	)		(1.0	)
Other assets		72,320		67,230		5,090			7.6
Total assets/liabilities & shareholders’ equity		856,384		750,392		105,993			14.1
Customer deposits**		364,709		331,494		33,214			10.0
Marketable debt securities**		27,974		6,472		21,501			332.2
Subordinated debt**		—		—		—			—
Insurance liabilities		7,962		5,052		2,910			57.6
Due to credit institutions**		186,106		147,535		38,571			26.1
Other liabilities		190,647		187,403		3,244			1.7
Shareholders’ equity***		78,988		72,435		6,553			9.0
Other customer funds under management		181,559		173,206		8,352			4.8
Mutual funds		177,476		171,407		6,069			3.5
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		4,083		1,800		2,283			126.9
Customer funds under management		574,241		511,173		63,068			12.3

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Mexico
Million new mexican peso

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		6,756			6,865			6,709			6,629			6,692			6,980			7,546
Net fees		2,360			2,369			2,383			2,367			2,626			2,487			2,674
Gains (losses) on financial transactions		1,129			507			1,118			198			812			1,022			(107	)
Other operating income*		(127	)		76			(85	)		85			(4	)		58			37
Gross income		10,119			9,816			10,124			9,279			10,125			10,547			10,149
Operating expenses		(3,724	)		(3,726	)		(3,904	)		(4,040	)		(3,812	)		(4,062	)		(4,389	)
General administrative expenses		(3,306	)		(3,250	)		(3,469	)		(3,581	)		(3,362	)		(3,603	)		(3,925	)
Personnel		(1,756	)		(1,721	)		(1,816	)		(1,882	)		(1,941	)		(1,977	)		(1,996	)
Other general administrative expenses		(1,550	)		(1,529	)		(1,654	)		(1,700	)		(1,421	)		(1,626	)		(1,929	)
Depreciation and amortisation		(419	)		(476	)		(435	)		(459	)		(451	)		(460	)		(465	)
Net operating income		6,394			6,090			6,220			5,238			6,313			6,485			5,760
Net loan-loss provisions		(2,339	)		(1,952	)		(1,703	)		(1,833	)		(1,045	)		(1,571	)		(1,649	)
Other income		(179	)		(335	)		(143	)		171			(93	)		(20	)		1,015
Profit before taxes		3,876			3,803			4,374			3,576			5,175			4,894			5,126
Tax on profit		(548	)		(836	)		(749	)		(238	)		(945	)		(997	)		(869	)
Profit from continuing operations		3,328			2,967			3,625			3,338			4,230			3,897			4,257
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		3,328			2,967			3,625			3,338			4,230			3,897			4,257
Minority interests		820			748			591			9			6			6			6
Attributable profit to the Group		2,508			2,219			3,034			3,329			4,224			3,891			4,251

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		208,977		225,558		245,681		250,795		269,266		300,865		324,961
Trading portfolio (w/o loans)		175,117		194,430		248,727		215,180		207,056		250,785		267,312
Available-for-sale financial assets		84,265		72,457		68,671		61,487		55,381		47,103		46,739
Due from credit institutions**		102,177		100,819		113,715		74,092		63,293		98,371		138,749
Intangible assets and property and equipment		6,649		6,411		6,366		6,630		6,461		6,344		6,303
Other assets		67,799		67,969		67,230		72,713		69,734		81,820		72,320
Total assets/liabilities & shareholders’ equity		644,984		667,643		750,392		680,897		671,191		785,288		856,384
Customer deposits**		296,120		303,977		331,494		349,884		347,496		353,517		364,709
Marketable debt securities**		6,937		7,634		6,472		6,011		20,349		37,501		27,974
Subordinated debt**		927		1,035		—		—		—		—		—
Insurance liabilities		4,325		5,030		5,052		5,007		7,026		7,746		7,962
Due to credit institutions**		143,533		122,800		147,535		124,218		99,415		160,598		186,106
Other liabilities		138,742		172,730		187,403		129,732		117,458		149,252		190,647
Shareholders’ equity***		54,399		54,437		72,435		66,046		79,447		76,674		78,988
Other customer funds under management		164,917		170,295		173,206		167,368		177,415		185,612		181,559
Mutual funds		163,250		168,527		171,407		165,563		173,631		181,618		177,476
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		1,668		1,769		1,800		1,805		3,784		3,994		4,083
Customer funds under management		468,902		482,943		511,173		523,263		545,260		576,630		574,241

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Chile
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,133			1,118			15			1.3
Net fees		323			297			25			8.5
Gains (losses) on financial transactions		66			76			(11	)		(14.1	)
Other operating income*		38			22			15			68.4
Gross income		1,559			1,515			45			3.0
Operating expenses		(607	)		(540	)		(67	)		12.5
General administrative expenses		(540	)		(478	)		(62	)		13.0
Personnel		(342	)		(299	)		(43	)		14.5
Other general administrative expenses		(198	)		(179	)		(19	)		10.5
Depreciation and amortisation		(67	)		(62	)		(5	)		8.3
Net operating income		952			975			(23	)		(2.3	)
Net loan-loss provisions		(291	)		(264	)		(27	)		10.3
Other income		26			(4	)		30			—
Profit before taxes		687			706			(19	)		(2.7	)
Tax on profit		(88	)		(95	)		7			(7.0	)
Profit from continuing operations		599			611			(13	)		(2.1	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		599			611			(13	)		(2.1	)
Minority interests		132			129			4			3.0
Attributable profit to the Group		466			483			(17	)		(3.4	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		25,176		23,587		1,589			6.7
Trading portfolio (w/o loans)		3,283		4,346		(1,063	)		(24.5	)
Available-for-sale financial assets		3,512		3,081		432			14.0
Due from credit institutions**		2,860		2,235		625			28.0
Intangible assets and property and equipment		326		348		(22	)		(6.3	)
Other assets		3,405		2,861		544			19.0
Total assets/liabilities & shareholders’ equity		38,563		36,458		2,105			5.8
Customer deposits**		19,305		16,674		2,632			15.8
Marketable debt securities**		5,174		4,929		245			5.0
Subordinated debt**		1,223		1,076		146			13.6
Insurance liabilities		333		292		40			13.8
Due to credit institutions**		4,874		4,607		267			5.8
Other liabilities		5,430		6,699		(1,269	)		(18.9	)
Shareholders’ equity***		2,224		2,181		43			2.0
Other customer funds under management		4,712		5,246		(534	)		(10.2	)
Mutual funds		4,635		5,189		(554	)		(10.7	)
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		77		57		20			34.3
Customer funds under management		30,414		27,925		2,489			8.9

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	24.81	28.59	(3.78 p.	)
Efficiency ratio (with amortisations)	38.9	35.6	3.3 p.
NPL ratio	3.63	3.58	0.05 p.
NPL coverage	88	94	(6 p.	)
Number of employees (direct & indirect)	12,300	11,629	671		5.8
Number of branches	494	500	(6	)	(1.2	)

Chile
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		340			391			388			381			364			398			371
Net fees		91			102			104			113			110			110			103
Gains (losses) on financial transactions		42			11			23			13			31			29			6
Other operating income*		1			12			9			11			12			14			11
Gross income		475			516			524			518			516			551			492
Operating expenses		(162	)		(188	)		(189	)		(197	)		(192	)		(203	)		(212	)
General administrative expenses		(142	)		(166	)		(169	)		(174	)		(169	)		(181	)		(190	)
Personnel		(86	)		(107	)		(105	)		(111	)		(105	)		(116	)		(122	)
Other general administrative expenses		(56	)		(59	)		(64	)		(63	)		(65	)		(65	)		(68	)
Depreciation and amortisation		(20	)		(22	)		(20	)		(23	)		(23	)		(22	)		(23	)
Net operating income		312			327			335			321			324			349			280
Net loan-loss provisions		(111	)		(89	)		(65	)		(59	)		(75	)		(85	)		(131	)
Other income		(7	)		8			(5	)		35			2			3			21
Profit before taxes		195			246			265			297			251			266			170
Tax on profit		(29	)		(36	)		(29	)		(60	)		(43	)		(26	)		(19	)
Profit from continuing operations		165			210			236			237			207			241			151
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		165			210			236			237			207			241			151
Minority interests		34			46			49			48			45			54			33
Attributable profit to the Group		132			164			187			189			162			187			118

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		20,313		22,470		23,587		25,732		24,562		25,555		25,176
Trading portfolio (w/o loans)		3,862		4,214		4,346		3,532		2,782		3,360		3,283
Available-for-sale financial assets		2,654		2,460		3,081		2,825		2,944		4,402		3,512
Due from credit institutions**		2,148		2,728		2,235		2,349		2,471		2,713		2,860
Intangible assets and property and equipment		353		349		348		374		332		332		326
Other assets		2,496		2,341		2,861		3,987		4,108		2,534		3,405
Total assets/liabilities & shareholders’ equity		31,825		34,561		36,458		38,799		37,198		38,895		38,563
Customer deposits**		14,934		16,666		16,674		18,108		18,353		18,829		19,305
Marketable debt securities**		3,191		3,887		4,929		5,590		5,462		5,558		5,174
Subordinated debt**		858		970		1,076		1,100		1,046		1,124		1,223
Insurance liabilities		229		271		292		332		314		349		333
Due to credit institutions**		5,692		5,598		4,607		5,567		4,207		5,063		4,874
Other liabilities		4,473		4,933		6,699		5,914		5,054		5,609		5,430
Shareholders’ equity***		2,449		2,236		2,181		2,187		2,761		2,364		2,224
Other customer funds under management		5,281		5,423		5,246		5,875		4,929		4,757		4,712
Mutual funds		5,241		5,370		5,189		5,806		4,868		4,675		4,635
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		40		53		57		69		61		82		77
Customer funds under management		24,264		26,946		27,925		30,674		29,791		30,267		30,414

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	3.36	3.31	3.58	3.74	3.80	3.65	3.63
NPL coverage	99	97	94	89	89	89	88
Spread (Retail Banking)	7.49	7.33	7.03	6.69	7.47	7.04	6.83
Spread loans	5.24	5.03	4.76	4.52	4.38	4.14	4.18
Spread deposits	2.25	2.30	2.27	2.17	3.09	2.90	2.65

Chile
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,593			1,467			126			8.6
Net fees		453			390			64			16.3
Gains (losses) on financial transactions		92			100			(8	)		(7.9	)
Other operating income*		53			29			24			80.4
Gross income		2,192			1,986			206			10.4
Operating expenses		(853	)		(708	)		(145	)		20.6
General administrative expenses		(759	)		(627	)		(132	)		21.1
Personnel		(480	)		(391	)		(89	)		22.7
Other general administrative expenses		(279	)		(235	)		(43	)		18.5
Depreciation and amortisation		(95	)		(81	)		(13	)		16.1
Net operating income		1,338			1,278			60			4.7
Net loan-loss provisions		(410	)		(347	)		(63	)		18.2
Other income		37			(5	)		42			—
Profit before taxes		966			926			39			4.3
Tax on profit		(124	)		(124	)		0			(0.3	)
Profit from continuing operations		842			802			40			5.0
Net profit from discontinued operations		—			—			—			—
Consolidated profit		842			802			40			5.0
Minority interests		186			169			17			10.4
Attributable profit to the Group		655			633			22			3.5

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		33,996		32,192		1,804			5.6
Trading portfolio (w/o loans)		4,433		5,932		(1,499	)		(25.3	)
Available-for-sale financial assets		4,743		4,205		538			12.8
Due from credit institutions**		3,861		3,050		811			26.6
Intangible assets and property and equipment		440		474		(35	)		(7.3	)
Other assets		4,598		3,905		694			17.8
Total assets/liabilities & shareholders’ equity		52,071		49,758		2,313			4.6
Customer deposits**		26,068		22,756		3,312			14.6
Marketable debt securities**		6,986		6,727		259			3.9
Subordinated debt**		1,651		1,469		182			12.4
Insurance liabilities		449		399		50			12.6
Due to credit institutions**		6,581		6,287		294			4.7
Other liabilities		7,332		9,143		(1,810	)		(19.8	)
Shareholders’ equity***		3,003		2,977		26			0.9
Other customer funds under management		6,363		7,160		(797	)		(11.1	)
Mutual funds		6,259		7,082		(823	)		(11.6	)
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		104		78		26			32.9
Customer funds under management		41,068		38,112		2,956			7.8

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Chile
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		470			496			500			516			498			571			524
Net fees		126			129			135			153			150			158			146
Gains (losses) on financial transactions		58			12			30			19			42			42			9
Other operating income*		1			16			12			15			16			21			16
Gross income		656			654			677			703			706			791			695
Operating expenses		(224	)		(239	)		(244	)		(267	)		(263	)		(291	)		(300	)
General administrative expenses		(197	)		(211	)		(219	)		(235	)		(231	)		(260	)		(268	)
Personnel		(119	)		(136	)		(136	)		(150	)		(143	)		(166	)		(172	)
Other general administrative expenses		(77	)		(75	)		(83	)		(85	)		(89	)		(94	)		(96	)
Depreciation and amortisation		(28	)		(28	)		(26	)		(32	)		(31	)		(31	)		(32	)
Net operating income		431			414			432			436			443			500			395
Net loan-loss provisions		(153	)		(111	)		(82	)		(81	)		(103	)		(122	)		(185	)
Other income		(9	)		11			(7	)		46			2			5			30
Profit before taxes		269			314			343			401			343			382			241
Tax on profit		(41	)		(46	)		(38	)		(81	)		(59	)		(38	)		(27	)
Profit from continuing operations		228			268			305			320			283			345			214
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		228			268			305			320			283			345			214
Minority interests		46			59			63			65			61			77			47
Attributable profit to the Group		182			209			242			255			222			267			166

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		27,380		27,572		32,192		34,383		34,896		36,934		33,996
Trading portfolio (w/o loans)		5,205		5,171		5,932		4,720		3,952		4,856		4,433
Available-for-sale financial assets		3,577		3,018		4,205		3,774		4,182		6,363		4,743
Due from credit institutions**		2,895		3,348		3,050		3,138		3,510		3,921		3,861
Intangible assets and property and equipment		475		428		474		500		471		479		440
Other assets		3,365		2,873		3,905		5,328		5,836		3,663		4,598
Total assets/liabilities & shareholders’ equity		42,897		42,410		49,758		51,843		52,848		56,215		52,071
Customer deposits**		20,130		20,450		22,756		24,196		26,074		27,213		26,068
Marketable debt securities**		4,301		4,770		6,727		7,470		7,760		8,033		6,986
Subordinated debt**		1,157		1,190		1,469		1,470		1,486		1,625		1,651
Insurance liabilities		308		333		399		444		447		505		449
Due to credit institutions**		7,672		6,870		6,287		7,438		5,977		7,317		6,581
Other liabilities		6,029		6,053		9,143		7,903		7,181		8,107		7,332
Shareholders’ equity***		3,301		2,744		2,977		2,923		3,923		3,416		3,003
Other customer funds under management		7,118		6,655		7,160		7,850		7,003		6,875		6,363
Mutual funds		7,065		6,590		7,082		7,758		6,916		6,757		6,259
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		54		65		78		92		87		118		104
Customer funds under management		32,705		33,065		38,112		40,986		42,323		43,746		41,068

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Chile
Million chilean peso

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		755,463			763,039			(7,575	)		(1.0	)
Net fees		215,046			202,798			12,248			6.0
Gains (losses) on financial transactions		43,707			52,070			(8,363	)		(16.1	)
Other operating income*		25,209			15,325			9,884			64.5
Gross income		1,039,425			1,033,231			6,194			0.6
Operating expenses		(404,726	)		(368,286	)		(36,441	)		9.9
General administrative expenses		(359,908	)		(325,949	)		(33,959	)		10.4
Personnel		(227,827	)		(203,662	)		(24,165	)		11.9
Other general administrative expenses		(132,082	)		(122,287	)		(9,795	)		8.0
Depreciation and amortisation		(44,818	)		(42,336	)		(2,482	)		5.9
Net operating income		634,699			664,945			(30,246	)		(4.5	)
Net loan-loss provisions		(194,253	)		(180,280	)		(13,973	)		7.8
Other income		17,495			(2,815	)		20,310			—
Profit before taxes		457,940			481,851			(23,910	)		(5.0	)
Tax on profit		(58,847	)		(64,728	)		5,881			(9.1	)
Profit from continuing operations		399,094			417,123			(18,029	)		(4.3	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		399,094			417,123			(18,029	)		(4.3	)
Minority interests		88,235			87,696			538			0.6
Attributable profit to the Group		310,859			329,427			(18,567	)		(5.6	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		17,716,827		15,598,568		2,118,259			13.6
Trading portfolio (w/o loans)		2,310,269		2,874,228		(563,959	)		(19.6	)
Available-for-sale financial assets		2,471,693		2,037,373		434,320			21.3
Due from credit institutions**		2,012,385		1,477,963		534,422			36.2
Intangible assets and property and equipment		229,232		229,898		(666	)		(0.3	)
Other assets		2,396,458		1,892,025		504,433			26.7
Total assets/liabilities & shareholders’ equity		27,136,863		24,110,055		3,026,809			12.6
Customer deposits**		13,585,435		11,026,419		2,559,017			23.2
Marketable debt securities**		3,640,664		3,259,387		381,277			11.7
Subordinated debt**		860,474		711,860		148,614			20.9
Insurance liabilities		234,117		193,391		40,726			21.1
Due to credit institutions**		3,429,901		3,046,373		383,528			12.6
Other liabilities		3,821,126		4,430,017		(608,891	)		(13.7	)
Shareholders’ equity***		1,565,146		1,442,607		122,539			8.5
Other customer funds under management		3,316,065		3,469,531		(153,467	)		(4.4	)
Mutual funds		3,261,897		3,431,628		(169,732	)		(4.9	)
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		54,168		37,903		16,265			42.9
Customer funds under management		21,402,638		18,467,198		2,935,440			15.9

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Chile
Million chilean peso

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		244,170			263,631			255,238			247,161			239,912			268,387			247,164
Net fees		65,451			68,497			68,849			73,866			72,215			74,210			68,621
Gains (losses) on financial transactions		30,219			6,748			15,102			8,384			20,133			19,496			4,078
Other operating income*		590			8,598			6,137			7,111			7,932			9,753			7,524
Gross income		340,430			347,474			345,326			336,523			340,192			371,846			327,386
Operating expenses		(116,424	)		(127,118	)		(124,744	)		(128,239	)		(126,715	)		(136,648	)		(141,363	)
General administrative expenses		(102,097	)		(112,182	)		(111,670	)		(112,997	)		(111,537	)		(122,039	)		(126,332	)
Personnel		(61,980	)		(72,207	)		(69,475	)		(72,032	)		(68,859	)		(78,016	)		(80,953	)
Other general administrative expenses		(40,117	)		(39,975	)		(42,195	)		(40,966	)		(42,679	)		(44,023	)		(45,380	)
Depreciation and amortisation		(14,327	)		(14,935	)		(13,074	)		(15,242	)		(15,178	)		(14,609	)		(15,031	)
Net operating income		224,007			220,357			220,582			208,284			213,478			235,198			186,023
Net loan-loss provisions		(79,655	)		(59,113	)		(41,511	)		(37,386	)		(49,410	)		(57,574	)		(87,269	)
Other income		(4,763	)		5,578			(3,630	)		23,408			1,056			2,150			14,289
Profit before taxes		139,588			166,821			175,441			194,305			165,124			179,774			113,042
Tax on profit		(21,129	)		(24,407	)		(19,191	)		(39,785	)		(28,630	)		(17,580	)		(12,637	)
Profit from continuing operations		118,459			142,414			156,250			154,520			136,494			162,195			100,406
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		118,459			142,414			156,250			154,520			136,494			162,195			100,406
Minority interests		24,106			31,381			32,209			31,454			29,553			36,460			22,221
Attributable profit to the Group		94,353			111,032			124,041			123,066			106,940			125,735			78,184

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		14,400,683		15,011,786		15,598,568		16,089,348		16,779,549		17,312,815		17,716,827
Trading portfolio (w/o loans)		2,737,538		2,815,194		2,874,228		2,208,774		1,900,341		2,276,042		2,310,269
Available-for-sale financial assets		1,881,218		1,643,376		2,037,373		1,766,125		2,011,073		2,982,570		2,471,693
Due from credit institutions**		1,522,675		1,822,602		1,477,963		1,468,583		1,687,726		1,837,839		2,012,385
Intangible assets and property and equipment		249,913		232,911		229,898		233,913		226,689		224,592		229,232
Other assets		1,769,688		1,563,996		1,892,025		2,493,273		2,806,379		1,717,032		2,396,458
Total assets/liabilities & shareholders’ equity		22,561,716		23,089,865		24,110,055		24,260,016		25,411,757		26,350,891		27,136,863
Customer deposits**		10,587,234		11,134,231		11,026,419		11,322,735		12,537,904		12,756,046		13,585,435
Marketable debt securities**		2,261,850		2,596,900		3,259,387		3,495,422		3,731,600		3,765,250		3,640,664
Subordinated debt**		608,269		647,889		711,860		687,851		714,574		761,731		860,474
Insurance liabilities		162,235		181,090		193,391		207,546		214,729		236,550		234,117
Due to credit institutions**		4,035,116		3,740,100		3,046,373		3,480,774		2,873,973		3,429,883		3,429,901
Other liabilities		3,171,093		3,295,674		4,430,017		3,697,996		3,452,794		3,800,166		3,821,126
Shareholders’ equity**		1,735,919		1,493,979		1,442,607		1,367,692		1,886,182		1,601,266		1,565,146
Other customer funds under management		3,743,867		3,623,158		3,469,531		3,673,419		3,367,169		3,222,683		3,316,065
Mutual funds		3,715,689		3,587,894		3,431,628		3,630,293		3,325,336		3,167,316		3,261,897
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		28,178		35,264		37,903		43,126		41,833		55,367		54,168
Customer funds under management		17,201,221		18,002,179		18,467,198		19,179,427		20,351,248		20,505,709		21,402,638

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Sovereign
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,261			1,320			(59	)		(4.5	)
Net fees		289			312			(23	)		(7.4	)
Gains (losses) on financial transactions		103			7			96			—
Other operating income*		(44	)		(51	)		6			(12.8	)
Gross income		1,609			1,589			20			1.3
Operating expenses		(704	)		(697	)		(6	)		0.9
General administrative expenses		(621	)		(619	)		(2	)		0.3
Personnel		(350	)		(349	)		(1	)		0.2
Other general administrative expenses		(271	)		(270	)		(1	)		0.4
Depreciation and amortisation		(83	)		(78	)		(5	)		5.8
Net operating income		905			891			14			1.5
Net loan-loss provisions		(257	)		(453	)		196			(43.2	)
Other income		(72	)		(17	)		(55	)		322.0
Profit before taxes		575			421			154			36.7
Tax on profit		(181	)		(128	)		(53	)		41.2
Profit from continuing operations		394			293			102			34.7
Net profit from discontinued operations		—			—			—			—
Consolidated profit		394			293			102			34.7
Minority interests		—			—			—			—
Attributable profit to the Group		394			293			102			34.7

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		37,936		35,565		2,372			6.7
Trading portfolio (w/o loans)		269		252		17			6.7
Available-for-sale financial assets		10,438		8,860		1,579			17.8
Due from credit institutions**		807		530		277			52.4
Intangible assets and property and equipment		555		464		91			19.6
Other assets		3,812		5,075		(1,263	)		(24.9	)
Total assets/liabilities & shareholders’ equity		53,817		50,745		3,073			6.1
Customer deposits**		35,141		30,291		4,850			16.0
Marketable debt securities**		1,617		1,834		(218	)		(11.9	)
Subordinated debt**		2,293		2,692		(399	)		(14.8	)
Insurance liabilities		—		—		—			—
Due to credit institutions**		8,194		10,691		(2,497	)		(23.4	)
Other liabilities		2,231		2,289		(58	)		(2.6	)
Shareholders’ equity***		4,342		2,948		1,394			47.3
Other customer funds under management		3		54		(50	)		(93.9	)
Mutual funds		—		—		—			—
Pension funds		—		—		—			—
Managed portfolios		3		54		(50	)		(93.9	)
Savings-insurance policies		—		—		—			—
Customer funds under management		39,054		34,871		4,183			12.0

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	13.24	13.89	(0.65 p.	)
Efficiency ratio (with amortisations)	43.7	43.9	(0.2 p.	)
NPL ratio	3.22	4.80	(1.58 p.	)
NPL coverage	93	72	22 p.
Number of employees (direct & indirect)	8,950	8,539	411		4.8
Number of branches	723	720	3		0.4

Sovereign
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		413			457			451			416			432			411			417
Net fees		96			112			105			95			93			96			100
Gains (losses) on financial transactions		6			(13	)		14			22			37			27			39
Other operating income*		(16	)		(18	)		(17	)		(16	)		(16	)		(16	)		(12	)
Gross income		498			538			553			517			546			518			545
Operating expenses		(219	)		(236	)		(242	)		(239	)		(237	)		(227	)		(239	)
General administrative expenses		(193	)		(210	)		(216	)		(213	)		(213	)		(198	)		(210	)
Personnel		(107	)		(116	)		(126	)		(119	)		(118	)		(113	)		(119	)
Other general administrative expenses		(85	)		(94	)		(91	)		(94	)		(95	)		(85	)		(91	)
Depreciation and amortisation		(27	)		(26	)		(25	)		(26	)		(24	)		(29	)		(30	)
Net operating income		279			302			311			278			309			291			306
Net loan-loss provisions		(167	)		(140	)		(146	)		(57	)		(98	)		(81	)		(78	)
Other income		(9	)		(14	)		5			(75	)		(27	)		(22	)		(23	)
Profit before taxes		104			147			170			146			184			187			204
Tax on profit		(35	)		(44	)		(49	)		(15	)		(56	)		(60	)		(66	)
Profit from continuing operations		69			103			121			132			128			128			138
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		69			103			121			132			128			128			138
Minority interests		—			—			—			—			—			—			—
Attributable profit to the Group		69			103			121			132			128			128			138

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		38,441		39,849		35,565		36,724		35,850		35,407		37,936
Trading portfolio (w/o loans)		191		249		252		211		175		196		269
Available-for-sale financial assets		10,758		11,587		8,860		10,203		9,603		9,394		10,438
Due from credit institutions**		315		718		530		722		518		682		807
Intangible assets and property and equipment		438		481		464		507		494		504		555
Other assets		3,244		3,785		5,075		3,430		4,177		4,458		3,812
Total assets/liabilities & shareholders’ equity		53,387		56,669		50,745		51,797		50,817		50,641		53,817
Customer deposits**		31,352		33,837		30,291		32,007		33,190		32,776		35,141
Marketable debt securities**		12,652		13,864		1,834		1,945		1,499		1,751		1,617
Subordinated debt**		2,763		2,913		2,692		2,781		2,274		2,142		2,293
Insurance liabilities		—		—		—		—		—		—		—
Due to credit institutions**		1,439		52		10,691		9,567		7,829		7,937		8,194
Other liabilities		2,272		2,729		2,289		2,297		1,911		2,009		2,231
Shareholders’ equity***		2,909		3,274		2,948		3,200		4,114		4,027		4,342
Other customer funds under management		229		92		54		30		19		14		3
Mutual funds		—		—		—		—		—		—		—
Pension funds		—		—		—		—		—		—		—
Managed portfolios		229		92		54		30		19		14		3
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		46,996		50,706		34,871		36,763		36,983		36,682		39,054

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	5.14	5.11	4.80	4.61	4.15	3.76	3.22
NPL coverage	65	67	72	75	82	85	93
Spread (Retail Banking)	7.21	6.91	6.88	6.41	6.67	7.01	7.14
Spread loans	5.84	5.70	5.72	5.34	5.41	5.46	5.56
Spread deposits	1.37	1.21	1.16	1.07	1.26	1.55	1.58

Sovereign
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,772			1,731			41			2.4
Net fees		406			410			(3	)		(0.8	)
Gains (losses) on financial transactions		145			9			136			—
Other operating income*		(62	)		(66	)		4			(6.6	)
Gross income		2,261			2,083			178			8.5
Operating expenses		(989	)		(915	)		(74	)		8.1
General administrative expenses		(872	)		(812	)		(61	)		7.5
Personnel		(492	)		(458	)		(34	)		7.4
Other general administrative expenses		(381	)		(354	)		(27	)		7.6
Depreciation and amortisation		(117	)		(103	)		(14	)		13.4
Net operating income		1,272			1,169			103			8.8
Net loan-loss provisions		(362	)		(594	)		232			(39.1	)
Other income		(101	)		(22	)		(79	)		352.3
Profit before taxes		809			552			257			46.5
Tax on profit		(255	)		(168	)		(86	)		51.4
Profit from continuing operations		554			384			170			44.4
Net profit from discontinued operations		—			—			—			—
Consolidated profit		554			384			170			44.4
Minority interests		—			—			—			—
Attributable profit to the Group		554			384			170			44.4

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		51,225		48,539		2,687			5.5
Trading portfolio (w/o loans)		363		344		19			5.6
Available-for-sale financial assets		14,095		12,092		2,003			16.6
Due from credit institutions**		1,090		723		367			50.7
Intangible assets and property and equipment		750		633		116			18.4
Other assets		5,147		6,926		(1,779	)		(25.7	)
Total assets/liabilities & shareholders’ equity		72,670		69,256		3,413			4.9
Customer deposits**		47,451		41,341		6,110			14.8
Marketable debt securities**		2,183		2,503		(320	)		(12.8	)
Subordinated debt**		3,096		3,674		(577	)		(15.7	)
Insurance liabilities		—		—		—			—
Due to credit institutions**		11,064		14,590		(3,526	)		(24.2	)
Other liabilities		3,012		3,124		(112	)		(3.6	)
Shareholders’ equity***		5,863		4,024		1,840			45.7
Other customer funds under management		4		73		(69	)		(94.0	)
Mutual funds		—		—		—			—
Pension funds		—		—		—			—
Managed portfolios		4		73		(69	)		(94.0	)
Savings-insurance policies		—		—		—			—
Customer funds under management		52,735		47,591		5,143			10.8

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Sovereign
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		570			580			581			565			591			591			589
Net fees		132			142			135			130			127			138			141
Gains (losses) on financial transactions		8			(17	)		18			29			50			39			56
Other operating income*		(22	)		(22	)		(21	)		(22	)		(22	)		(23	)		(17	)
Gross income		688			682			713			702			746			745			770
Operating expenses		(303	)		(300	)		(312	)		(325	)		(324	)		(327	)		(338	)
General administrative expenses		(266	)		(266	)		(279	)		(289	)		(291	)		(285	)		(296	)
Personnel		(148	)		(147	)		(162	)		(161	)		(161	)		(163	)		(168	)
Other general administrative expenses		(118	)		(119	)		(117	)		(128	)		(130	)		(123	)		(129	)
Depreciation and amortisation		(37	)		(33	)		(33	)		(36	)		(33	)		(42	)		(42	)
Net operating income		385			382			401			378			422			418			432
Net loan-loss provisions		(230	)		(175	)		(189	)		(81	)		(134	)		(117	)		(111	)
Other income		(12	)		(18	)		7			(99	)		(36	)		(32	)		(33	)
Profit before taxes		143			189			220			199			252			269			288
Tax on profit		(48	)		(57	)		(64	)		(21	)		(76	)		(86	)		(93	)
Profit from continuing operations		95			132			157			178			176			183			195
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		95			132			157			178			176			183			195
Minority interests		—			—			—			—			—			—			—
Attributable profit to the Group		95			132			157			178			176			183			195

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Customer loans**		51,815		48,898		48,539		49,070		50,932		51,174		51,225
Trading portfolio (w/o loans)		258		306		344		282		249		283		363
Available-for-sale financial assets		14,500		14,218		12,092		13,633		13,643		13,578		14,095
Due from credit institutions**		425		881		723		964		736		985		1,090
Intangible assets and property and equipment		590		590		633		678		702		729		750
Other assets		4,373		4,644		6,926		4,583		5,934		6,443		5,147
Total assets/liabilities & shareholders’ equity		71,961		69,539		69,256		69,211		72,196		73,192		72,670
Customer deposits**		42,259		41,522		41,341		42,768		47,154		47,371		47,451
Marketable debt securities**		17,054		17,012		2,503		2,599		2,130		2,531		2,183
Subordinated debt**		3,724		3,575		3,674		3,716		3,231		3,096		3,096
Insurance liabilities		—		—		—		—		—		—		—
Due to credit institutions**		1,939		63		14,590		12,783		11,122		11,471		11,064
Other liabilities		3,063		3,348		3,124		3,069		2,715		2,903		3,012
Shareholders’ equity***		3,922		4,018		4,024		4,276		5,844		5,821		5,863
Other customer funds under management		309		112		73		40		27		20		4
Mutual funds		—		—		—		—		—		—		—
Pension funds		—		—		—		—		—		—		—
Managed portfolios		309		112		73		40		27		20		4
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		63,346		62,221		47,591		49,123		52,542		53,017		52,735

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Corporate Activities
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		(1,678	)		(1,369	)		(308	)		22.5
Net fees		(10	)		(32	)		22			(68.2	)
Gains (losses) on financial transactions		370			(226	)		596			—
Dividends		41			42			(1	)		(1.5	)
Income from equity-accounted method		2			(2	)		4			—
Other operating income/expenses		105			100			4			4.2
Gross income		(1,170	)		(1,487	)		317			(21.3	)
Operating expenses		(655	)		(629	)		(26	)		4.1
General administrative expenses		(564	)		(527	)		(37	)		7.0
Personnel		(236	)		(206	)		(29	)		14.3
Other general administrative expenses		(328	)		(321	)		(7	)		2.3
Depreciation and amortisation		(91	)		(102	)		11			(10.9	)
Net operating income		(1,824	)		(2,116	)		292			(13.8	)
Net loan-loss provisions		40			(87	)		128			—
Other income		(351	)		(432	)		81			(18.6	)
Profit before taxes		(2,135	)		(2,635	)		500			(19.0	)
Tax on profit		339			740			(401	)		(54.2	)
Profit from continuing operations		(1,796	)		(1,895	)		99			(5.2	)
Net profit from discontinued operations		(19	)		(10	)		(8	)		77.4
Consolidated profit		(1,814	)		(1,905	)		91			(4.8	)
Minority interests		2			1			1			148.6
Attributable profit to the Group		(1,817	)		(1,906	)		89			(4.7	)

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Trading portfolio (w/o loans)		4,842		4,751		91			1.9
Available-for-sale financial assets		19,806		21,063		(1,257	)		(6.0	)
Investments		959		37		922			—
Goodwill		25,914		23,928		1,986			8.3
Liquidity lent to the Group		15,621		40,197		(24,576	)		(61.1	)
Capital assigned to Group areas		67,798		64,324		3,474			5.4
Other assets		91,989		67,356		24,633			36.6
Total assets/liabilities & shareholders’ equity		226,930		221,657		5,273			2.4
Customer deposits*		11,981		14,495		(2,514	)		(17.3	)
Marketable debt securities*		61,382		74,396		(13,014	)		(17.5	)
Subordinated debt		8,973		13,866		(4,893	)		(35.3	)
Other liabilities		69,612		50,114		19,498			38.9
Group capital and reserves**		74,982		68,786		6,196			9.0
Other customer funds under management		—		—		—			—
Mutual funds		—		—		—			—
Pension funds		—		—		—			—
Managed portfolios		—		—		—			—
Savings-insurance policies		—		—		—			—
Customer funds under management		82,336		102,757		(20,421	)		(19.9	)

*	Including all on-balance sheet balances for this item
**	Not including profit of the year

Resources
Number of employees (direct & indirect)	2,326	2,507	(181	)	(7.2	)

Corporate Activities
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		(393	)		(472	)		(504	)		(459	)		(511	)		(613	)		(553	)
Net fees		(2	)		(10	)		(21	)		(8	)		(4	)		(4	)		(2	)
Gains (losses) on financial transactions		(55	)		(73	)		(97	)		84			(74	)		159			286
Dividends		6			24			12			22			4			17			20
Income from equity-accounted method		(1	)		(1	)		1			0			1			1			0
Other operating income/expenses		30			33			37			37			28			46			30
Gross income		(415	)		(500	)		(572	)		(323	)		(556	)		(394	)		(219	)
Operating expenses		(227	)		(193	)		(209	)		(193	)		(245	)		(207	)		(203	)
General administrative expenses		(188	)		(167	)		(172	)		(162	)		(212	)		(179	)		(173	)
Personnel		(92	)		(42	)		(72	)		(62	)		(88	)		(69	)		(78	)
Other general administrative expenses		(96	)		(125	)		(99	)		(100	)		(124	)		(110	)		(95	)
Depreciation and amortisation		(39	)		(26	)		(38	)		(31	)		(33	)		(28	)		(30	)
Net operating income		(643	)		(692	)		(781	)		(516	)		(801	)		(601	)		(422	)
Net loan-loss provisions		(38	)		(22	)		(27	)		(24	)		(69	)		87			22
Other income		(91	)		(155	)		(186	)		4			(187	)		(143	)		(21	)
Profit before taxes		(771	)		(869	)		(995	)		(536	)		(1,056	)		(657	)		(422	)
Tax on profit		216			314			210			127			222			63			55
Profit from continuing operations		(555	)		(555	)		(784	)		(409	)		(834	)		(594	)		(367	)
Net profit from discontinued operations		(10	)		(0	)		(0	)		(3	)		—			—			(19	)
Consolidated profit		(565	)		(555	)		(784	)		(412	)		(834	)		(594	)		(386	)
Minority interests		(1	)		(0	)		2			(26	)		0			4			(2	)
Attributable profit to the Group		(564	)		(555	)		(787	)		(385	)		(835	)		(598	)		(384	)

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Balance sheet
Trading portfolio (w/o loans)		5,146		7,240		4,751		5,123		4,833		5,268		4,842
Available-for-sale financial assets		22,467		19,628		21,063		21,288		21,386		21,890		19,806
Investments		33		62		37		38		38		39		959
Goodwill		23,602		25,345		23,928		24,622		23,856		26,527		25,914
Liquidity lent to the Group		49,607		39,147		40,197		28,265		30,235		23,035		15,621
Capital assigned to Group areas		58,705		61,110		64,324		63,187		69,132		69,199		67,798
Other assets		79,940		70,172		67,356		64,806		74,185		72,618		91,989
Total assets/liabilities & shareholders’ equity		239,500		222,703		221,657		207,329		223,665		218,575		226,930
Customer deposits*		10,197		9,692		14,495		14,258		11,448		11,256		11,981
Marketable debt securities*		80,077		75,260		74,396		62,812		64,020		61,598		61,382
Subordinated debt		16,047		15,311		13,866		12,128		10,000		9,202		8,973
Other liabilities		59,295		52,739		50,114		47,709		59,385		61,182		69,612
Group capital and reserves***		73,883		69,702		68,786		70,423		78,812		75,337		74,982
Other customer funds under management		—		—		—		—		—		—		—
Mutual funds		—		—		—		—		—		—		—
Pension funds		—		—		—		—		—		—		—
Managed portfolios		—		—		—		—		—		—		—
Savings-insurance policies		—		—		—		—		—		—		—
Customer funds under management		106,321		100,262		102,757		89,198		85,469		82,056		82,336

*	Including all on-balance sheet balances for this item
**	Not including profit of the year

Spain
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		4,296			4,467			(171	)		(3.8	)
Net fees		1,801			1,794			7			0.4
Gains (losses) on financial transactions		171			619			(448	)		(72.3	)
Other operating income*		274			245			29			11.6
Gross income		6,542			7,125			(583	)		(8.2	)
Operating expenses		(3,073	)		(3,089	)		16			(0.5	)
General administrative expenses		(2,775	)		(2,780	)		5			(0.2	)
Personnel		(1,827	)		(1,826	)		(1	)		0.1
Other general administrative expenses		(948	)		(954	)		6			(0.7	)
Depreciation and amortisation		(298	)		(309	)		11			(3.6	)
Net operating income		3,470			4,037			(567	)		(14.0	)
Net loan-loss provisions		(1,631	)		(1,647	)		16			(1.0	)
Other income		(273	)		(48	)		(225	)		469.9
Profit before taxes		1,566			2,342			(776	)		(33.1	)
Tax on profit		(410	)		(600	)		190			(31.7	)
Profit from continuing operations		1,157			1,742			(586	)		(33.6	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		1,157			1,742			(586	)		(33.6	)
Minority interests		36			54			(18	)		(33.6	)
Attributable profit to the Group		1,121			1,689			(568	)		(33.6	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Balance sheet
Customer loans**		219,758		232,767		(13,009	)		(5.6	)
Trading portfolio (w/o loans)		66,688		64,286		2,402			3.7
Available-for-sale financial assets		12,156		17,091		(4,935	)		(28.9	)
Due from credit institutions**		16,323		65,992		(49,669	)		(75.3	)
Intangible assets and property and equipment		3,793		3,953		(160	)		(4.0	)
Other assets		8,094		13,326		(5,232	)		(39.3	)
Total assets/liabilities & shareholders’ equity		326,812		397,415		(70,603	)		(17.8	)
Customer deposits**		179,225		186,925		(7,700	)		(4.1	)
Marketable debt securities**		28,060		31,735		(3,675	)		(11.6	)
Subordinated debt**		859		1,749		(890	)		(50.9	)
Insurance liabilities		793		2,030		(1,237	)		(60.9	)
Due to credit institutions**		10,836		43,277		(32,441	)		(75.0	)
Other liabilities		86,898		112,762		(25,864	)		(22.9	)
Shareholders’ equity***		20,141		18,938		1,203			6.4
Other customer funds under management		42,244		54,235		(11,991	)		(22.1	)
Mutual funds		28,331		38,257		(9,926	)		(25.9	)
Pension funds		8,910		9,551		(640	)		(6.7	)
Managed portfolios		5,003		5,303		(301	)		(5.7	)
Savings-insurance policies		—		1,124		(1,124	)		(100.0	)
Customer funds under management		250,388		274,643		(24,255	)		(8.8	)

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Ratios (%) and other data
ROE	7.27	11.92	(4.65 p.	)
Efficiency ratio (with amortisations)	47.0	43.3	3.7 p.
NPL ratio	5.15	3.88	1.27 p.
NPL coverage	46	65	(19 p.	)
Number of employees (direct & indirect)	33,214	33,536	(322	)	(1.0	)
Number of branches	4,785	4,856	(71	)	(1.5	)

Spain
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,627			1,493			1,347			1,278			1,339			1,506			1,451
Net fees		631			585			578			544			621			607			573
Gains (losses) on financial transactions		285			205			129			177			227			(10	)		(46	)
Other operating income*		43			131			72			100			61			152			61
Gross income		2,586			2,414			2,126			2,100			2,248			2,256			2,038
Operating expenses		(1,022	)		(1,035	)		(1,032	)		(1,055	)		(1,027	)		(1,028	)		(1,018	)
General administrative expenses		(922	)		(929	)		(929	)		(936	)		(929	)		(927	)		(919	)
Personnel		(601	)		(621	)		(604	)		(598	)		(610	)		(614	)		(604	)
Other general administrative expenses		(321	)		(308	)		(325	)		(337	)		(319	)		(313	)		(315	)
Depreciation and amortisation		(100	)		(106	)		(103	)		(119	)		(98	)		(101	)		(99	)
Net operating income		1,564			1,379			1,094			1,045			1,222			1,229			1,020
Net loan-loss provisions		(327	)		(352	)		(968	)		(527	)		(312	)		(595	)		(724	)
Other income		(10	)		(27	)		(11	)		(75	)		(75	)		(101	)		(96	)
Profit before taxes		1,227			1,001			115			443			835			532			199
Tax on profit		(335	)		(272	)		7			(119	)		(226	)		(132	)		(51	)
Profit from continuing operations		892			728			122			325			609			400			148
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		892			728			122			325			609			400			148
Minority interests		22			25			7			5			16			13			7
Attributable profit to the Group		870			704			115			320			593			387			141

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11			30.06.11		30.09.11
Balance sheet
Customer loans**		234,551		239,575		232,767		228,863		223,519			222,604		219,758
Trading portfolio (w/o loans)		56,654		59,725		64,286		48,860		42,230			47,412		66,688
Available-for-sale financial assets		17,136		15,193		17,091		13,837		14,620			14,691		12,156
Due from credit institutions**		56,388		57,802		65,992		23,946		21,569			17,480		16,323
Intangible assets and property and equipment		3,992		3,995		3,953		3,934		3,953			3,939		3,793
Other assets		15,046		13,635		13,326		12,145		8,320			9,805		8,094
Total assets/liabilities & shareholders’ equity		383,767		389,925		397,415		331,585		314,211			315,932		326,812
Customer deposits**		165,806		185,206		186,925		187,834		192,573			182,192		179,225
Marketable debt securities**		32,030		31,150		31,735		31,206		30,449			29,538		28,060
Subordinated debt**		1,752		1,788		1,749		1,736		1,216			1,237		859
Insurance liabilities		5,456		2,914		2,030		808		889			837		793
Due to credit institutions**		55,262		41,747		43,277		4,868		3,280			7,186		10,836
Other liabilities		104,918		107,767		112,762		85,389		65,245			74,231		86,898
Shareholders’ equity***		18,544		19,353		18,938		19,743		20,558			20,711		20,141
Other customer funds under management		59,773		55,221		54,235		49,313		46,795			45,276		42,244
Mutual funds		40,271		38,395		38,257		34,310		31,974			30,209		28,331
Pension funds		9,826		9,425		9,551		9,650		9,602			9,477		8,910
Managed portfolios		5,388		5,313		5,303		5,353		5,220			5,590		5,003
Savings-insurance policies		4,288		2,087		1,124		0		(0	)		—		—
Customer funds under management		259,360		273,364		274,643		270,089		271,034			258,243		250,388

**	Including all on-balance sheet balances for this item
***	Not including profit of the year

Other information
NPL ratio	3.59	3.71	3.88	4.24	4.57	4.81	5.15
NPL coverage	68	64	65	58	53	49	46

Retail Banking
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		22,486			21,395			1,091			5.1
Net fees		6,797			6,039			758			12.6
Gains (losses) on financial transactions		968			977			(9	)		(0.9	)
Other operating income*		(327	)		(176	)		(152	)		86.3
Gross income		29,924			28,235			1,689			6.0
Operating expenses		(12,583	)		(11,526	)		(1,057	)		9.2
General administrative expenses		(11,231	)		(10,348	)		(882	)		8.5
Personnel		(6,585	)		(5,927	)		(658	)		11.1
Other general administrative expenses		(4,646	)		(4,422	)		(224	)		5.1
Depreciation and amortisation		(1,352	)		(1,178	)		(174	)		14.8
Net operating income		17,341			16,709			632			3.8
Net loan-loss provisions		(7,687	)		(7,768	)		81			(1.0	)
Other income		(2,036	)		(753	)		(1,283	)		170.3
Profit before taxes		7,618			8,188			(570	)		(7.0	)
Tax on profit		(1,852	)		(1,905	)		53			(2.8	)
Profit from continuing operations		5,766			6,282			(517	)		(8.2	)
Net profit from discontinued operations		(3	)		(7	)		4			(57.0	)
Consolidated profit		5,763			6,276			(513	)		(8.2	)
Minority interests		433			486			(53	)		(10.9	)
Attributable profit to the Group		5,330			5,790			(460	)		(7.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Business volumes
Total assets		875,473		892,082		(16,609	)		(1.9	)
Customer loans		656,400		643,611		12,788			2.0
Customer deposits		521,572		505,224		16,348			3.2

Retail Banking
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		6,928			7,169			7,298			7,090			7,383			7,543			7,559
Net fees		1,910			2,070			2,060			2,023			2,173			2,314			2,311
Gains (losses) on financial transactions		269			353			355			360			326			427			215
Other operating income*		(38	)		(58	)		(79	)		(80	)		(99	)		(107	)		(121	)
Gross income		9,068			9,534			9,633			9,393			9,783			10,176			9,964
Operating expenses		(3,620	)		(3,894	)		(4,011	)		(4,014	)		(4,098	)		(4,196	)		(4,289	)
General administrative expenses		(3,247	)		(3,490	)		(3,611	)		(3,577	)		(3,666	)		(3,741	)		(3,824	)
Personnel		(1,859	)		(1,999	)		(2,069	)		(2,079	)		(2,156	)		(2,186	)		(2,243	)
Other general administrative expenses		(1,388	)		(1,491	)		(1,542	)		(1,498	)		(1,510	)		(1,555	)		(1,581	)
Depreciation and amortisation		(373	)		(405	)		(400	)		(437	)		(432	)		(455	)		(465	)
Net operating income		5,448			5,640			5,621			5,380			5,685			5,980			5,675
Net loan-loss provisions		(2,447	)		(2,441	)		(2,880	)		(2,376	)		(2,131	)		(2,671	)		(2,886	)
Other income		(286	)		(248	)		(219	)		(334	)		(389	)		(1,284	)		(362	)
Profit before taxes		2,715			2,951			2,522			2,669			3,165			2,025			2,428
Tax on profit		(628	)		(702	)		(576	)		(712	)		(808	)		(438	)		(606	)
Profit from continuing operations		2,087			2,249			1,946			1,956			2,357			1,587			1,822
Net profit from discontinued operations		(2	)		(1	)		(4	)		(7	)		(6	)		(0	)		3
Consolidated profit		2,085			2,248			1,943			1,949			2,352			1,586			1,825
Minority interests		128			168			189			160			169			161			103
Attributable profit to the Group		1,957			2,080			1,754			1,789			2,183			1,426			1,722

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Business volumes
Total assets		836,085		900,570		892,082		859,889		851,363		867,858		875,473
Customer loans		620,265		655,547		643,611		650,472		644,262		647,713		656,400
Customer deposits		468,295		510,760		505,224		513,418		510,883		518,197		521,572

Retail Banking Continental Europe
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		7,326			6,919			407			5.9
Net fees		2,649			2,281			368			16.1
Gains (losses) on financial transactions		230			248			(17	)		(7.0	)
Other operating income*		7			43			(36	)		(84.1	)
Gross income		10,212			9,490			722			7.6
Operating expenses		(4,258	)		(3,774	)		(484	)		12.8
General administrative expenses		(3,863	)		(3,410	)		(453	)		13.3
Personnel		(2,411	)		(2,156	)		(254	)		11.8
Other general administrative expenses		(1,453	)		(1,254	)		(199	)		15.8
Depreciation and amortisation		(394	)		(364	)		(30	)		8.4
Net operating income		5,955			5,716			238			4.2
Net loan-loss provisions		(2,800	)		(3,006	)		206			(6.9	)
Other income		(305	)		(46	)		(259	)		563.0
Profit before taxes		2,850			2,665			185			7.0
Tax on profit		(730	)		(647	)		(83	)		12.8
Profit from continuing operations		2,121			2,018			103			5.1
Net profit from discontinued operations		(3	)		(7	)		4			(57.0	)
Consolidated profit		2,118			2,012			106			5.3
Minority interests		95			74			21			27.7
Attributable profit to the Group		2,023			1,937			86			4.4

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Continental Europe
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,398			2,267			2,253			2,174			2,309			2,529			2,488
Net fees		757			763			761			755			832			918			899
Gains (losses) on financial transactions		87			97			63			111			71			84			76
Other operating income*		9			22			12			10			(4	)		27			(16	)
Gross income		3,251			3,149			3,090			3,051			3,208			3,557			3,447
Operating expenses		(1,236	)		(1,241	)		(1,297	)		(1,317	)		(1,338	)		(1,465	)		(1,454	)
General administrative expenses		(1,117	)		(1,118	)		(1,175	)		(1,185	)		(1,214	)		(1,329	)		(1,320	)
Personnel		(710	)		(711	)		(735	)		(736	)		(760	)		(828	)		(822	)
Other general administrative expenses		(406	)		(407	)		(440	)		(448	)		(454	)		(501	)		(497	)
Depreciation and amortisation		(119	)		(123	)		(122	)		(132	)		(124	)		(136	)		(135	)
Net operating income		2,016			1,908			1,792			1,734			1,870			2,092			1,993
Net loan-loss provisions		(756	)		(795	)		(1,455	)		(981	)		(658	)		(989	)		(1,153	)
Other income		(23	)		(40	)		16			(106	)		(82	)		(118	)		(104	)
Profit before taxes		1,237			1,074			354			647			1,130			985			736
Tax on profit		(328	)		(275	)		(43	)		(188	)		(310	)		(247	)		(172	)
Profit from continuing operations		909			799			310			458			820			738			563
Net profit from discontinued operations		(2	)		(1	)		(4	)		(7	)		(6	)		(0	)		3
Consolidated profit		907			798			306			451			814			737			566
Minority interests		26			29			20			16			36			35			24
Attributable profit to the Group		882			769			287			435			778			703			542

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Spain
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		3,810			3,970			(160	)		(4.0	)
Net fees		1,439			1,408			31			2.2
Gains (losses) on financial transactions		198			217			(19	)		(8.7	)
Other operating income*		(6	)		28			(34	)		—
Gross income		5,441			5,623			(182	)		(3.2	)
Operating expenses		(2,551	)		(2,582	)		30			(1.2	)
General administrative expenses		(2,311	)		(2,342	)		31			(1.3	)
Personnel		(1,534	)		(1,546	)		12			(0.8	)
Other general administrative expenses		(777	)		(796	)		19			(2.4	)
Depreciation and amortisation		(240	)		(240	)		(0	)		0.2
Net operating income		2,889			3,042			(152	)		(5.0	)
Net loan-loss provisions		(1,566	)		(1,639	)		73			(4.5	)
Other income		(237	)		(30	)		(208	)		700.4
Profit before taxes		1,086			1,373			(287	)		(20.9	)
Tax on profit		(269	)		(330	)		62			(18.7	)
Profit from continuing operations		818			1,043			(225	)		(21.6	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		818			1,043			(225	)		(21.6	)
Minority interests		30			50			(20	)		(39.5	)
Attributable profit to the Group		788			993			(205	)		(20.7	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Spain
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,464			1,317			1,189			1,122			1,190			1,317			1,303
Net fees		488			467			453			435			485			486			468
Gains (losses) on financial transactions		75			83			59			120			78			68			51
Other operating income*		1			19			7			13			(3	)		7			(10	)
Gross income		2,028			1,887			1,708			1,689			1,751			1,878			1,812
Operating expenses		(859	)		(862	)		(861	)		(871	)		(852	)		(854	)		(845	)
General administrative expenses		(780	)		(782	)		(780	)		(786	)		(774	)		(772	)		(765	)
Personnel		(517	)		(519	)		(510	)		(510	)		(512	)		(515	)		(507	)
Other general administrative expenses		(263	)		(263	)		(270	)		(276	)		(261	)		(257	)		(259	)
Depreciation and amortisation		(79	)		(80	)		(80	)		(85	)		(79	)		(82	)		(80	)
Net operating income		1,170			1,025			847			819			898			1,024			967
Net loan-loss provisions		(349	)		(346	)		(944	)		(520	)		(313	)		(542	)		(711	)
Other income		(10	)		(10	)		(9	)		(75	)		(71	)		(94	)		(73	)
Profit before taxes		810			669			(106	)		224			515			388			183
Tax on profit		(221	)		(181	)		72			(56	)		(136	)		(89	)		(43	)
Profit from continuing operations		590			487			(34	)		168			379			299			140
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		590			487			(34	)		168			379			299			140
Minority interests		21			24			5			3			14			11			5
Attributable profit to the Group		569			464			(40	)		164			365			288			135

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Portugal
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		408			508			(100	)		(19.7	)
Net fees		206			218			(11	)		(5.2	)
Gains (losses) on financial transactions		(11	)		30			(41	)		—
Other operating income*		3			6			(3	)		(56.2	)
Gross income		606			761			(155	)		(20.4	)
Operating expenses		(365	)		(372	)		6			(1.7	)
General administrative expenses		(316	)		(321	)		5			(1.5	)
Personnel		(221	)		(223	)		2			(1.0	)
Other general administrative expenses		(96	)		(98	)		3			(2.6	)
Depreciation and amortisation		(49	)		(51	)		2			(3.0	)
Net operating income		240			389			(149	)		(38.2	)
Net loan-loss provisions		(118	)		(102	)		(16	)		15.4
Other income		(41	)		29			(69	)		—
Profit before taxes		82			316			(234	)		(74.1	)
Tax on profit		(4	)		(38	)		34			(89.2	)
Profit from continuing operations		78			278			(200	)		(72.0	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		78			278			(200	)		(72.0	)
Minority interests		(0	)		0			(0	)		—
Attributable profit to the Group		78			278			(200	)		(71.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Portugal
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		176			171			161			156			154			136			117
Net fees		72			75			71			70			71			66			69
Gains (losses) on financial transactions		12			19			(0	)		4			(1	)		(5	)		(4	)
Other operating income*		3			3			0			(0	)		1			0			2
Gross income		262			266			232			230			225			198			183
Operating expenses		(119	)		(123	)		(129	)		(129	)		(121	)		(122	)		(123	)
General administrative expenses		(103	)		(106	)		(113	)		(111	)		(105	)		(106	)		(106	)
Personnel		(71	)		(74	)		(78	)		(76	)		(73	)		(73	)		(74	)
Other general administrative expenses		(32	)		(32	)		(35	)		(35	)		(32	)		(32	)		(32	)
Depreciation and amortisation		(17	)		(17	)		(17	)		(18	)		(16	)		(16	)		(17	)
Net operating income		143			143			103			101			104			77			60
Net loan-loss provisions		(15	)		(42	)		(44	)		(8	)		(33	)		(39	)		(46	)
Other income		(8	)		(0	)		37			(8	)		(8	)		(14	)		(19	)
Profit before taxes		120			101			95			86			62			24			(4	)
Tax on profit		(18	)		(7	)		(13	)		(20	)		(5	)		(7	)		8
Profit from continuing operations		101			94			82			66			57			17			3
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		101			94			82			66			57			17			3
Minority interests		0			(0	)		0			0			0			(0	)		(0	)
Attributable profit to the Group		101			94			82			66			57			17			4

* Including dividends, income from equity-accounted method and other operating income/expenses

Other information
Spread	1.85	1.92	2.03	2.11	2.08	1.75		1.68
Spread loans	1.76	1.82	1.82	1.88	1.96	2.06		2.15
Spread deposits	0.09	0.10	0.21	0.23	0.12	(0.31	)	(0.47	)

Retail Banking United Kingdom
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		3,128			3,550			(421	)		(11.9	)
Net fees		722			701			20			2.9
Gains (losses) on financial transactions		44			9			35			399.5
Other operating income*		10			19			(9	)		(46.7	)
Gross income		3,904			4,279			(374	)		(8.8	)
Operating expenses		(1,720	)		(1,761	)		41			(2.4	)
General administrative expenses		(1,454	)		(1,533	)		79			(5.1	)
Personnel		(908	)		(884	)		(24	)		2.7
Other general administrative expenses		(547	)		(649	)		102			(15.7	)
Depreciation and amortisation		(265	)		(228	)		(37	)		16.3
Net operating income		2,184			2,517			(333	)		(13.2	)
Net loan-loss provisions		(426	)		(763	)		338			(44.2	)
Other income		(945	)		(24	)		(921	)		—
Profit before taxes		814			1,730			(916	)		(53.0	)
Tax on profit		(258	)		(492	)		233			(47.5	)
Profit from continuing operations		556			1,238			(683	)		(55.1	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		556			1,238			(683	)		(55.1	)
Minority interests		0			0			(0	)		(93.1	)
Attributable profit to the Group		556			1,238			(683	)		(55.1	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking United Kingdom
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,147			1,178			1,225			1,153			1,105			1,018			1,005
Net fees		230			246			225			206			209			262			251
Gains (losses) on financial transactions		(3	)		13			(1	)		(44	)		16			35			(7	)
Other operating income*		6			6			6			7			4			4			2
Gross income		1,380			1,443			1,455			1,322			1,333			1,320			1,251
Operating expenses		(567	)		(598	)		(597	)		(575	)		(593	)		(562	)		(565	)
General administrative expenses		(492	)		(518	)		(523	)		(497	)		(503	)		(475	)		(476	)
Personnel		(282	)		(299	)		(303	)		(283	)		(306	)		(288	)		(313	)
Other general administrative expenses		(209	)		(219	)		(220	)		(214	)		(197	)		(187	)		(163	)
Depreciation and amortisation		(75	)		(80	)		(73	)		(78	)		(90	)		(87	)		(89	)
Net operating income		814			845			858			747			740			758			687
Net loan-loss provisions		(270	)		(255	)		(238	)		(201	)		(139	)		(128	)		(159	)
Other income		(6	)		(9	)		(9	)		(98	)		(43	)		(874	)		(28	)
Profit before taxes		538			581			611			448			559			(245	)		500
Tax on profit		(156	)		(152	)		(184	)		(123	)		(166	)		49			(142	)
Profit from continuing operations		382			429			427			325			393			(196	)		358
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		382			429			427			325			393			(196	)		358
Minority interests		0			0			0			0			(0	)		0			(0	)
Attributable profit to the Group		382			429			427			325			393			(196	)		358

* Including dividends, income from equity-accounted method and other operating income/expenses

Other information
Spread	1.99		1.99		2.03		2.03		2.04		1.97		1.96
Spread loans	2.05		2.13		2.20		2.28		2.34		2.35		2.42
Spread deposits	(0.06	)	(0.14	)	(0.17	)	(0.25	)	(0.30	)	(0.38	)	(0.45	)

Retail Banking United Kingdom
Million pound sterling

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		2,725			3,040			(315	)		(10.3	)
Net fees		629			601			28			4.7
Gains (losses) on financial transactions		38			8			31			408.2
Other operating income*		9			16			(7	)		(45.7	)
Gross income		3,401			3,664			(263	)		(7.2	)
Operating expenses		(1,498	)		(1,508	)		10			(0.7	)
General administrative expenses		(1,267	)		(1,313	)		46			(3.5	)
Personnel		(791	)		(757	)		(34	)		4.4
Other general administrative expenses		(476	)		(556	)		79			(14.3	)
Depreciation and amortisation		(231	)		(195	)		(36	)		18.3
Net operating income		1,903			2,156			(253	)		(11.7	)
Net loan-loss provisions		(371	)		(654	)		283			(43.3	)
Other income		(823	)		(20	)		(802	)		—
Profit before taxes		709			1,482			(773	)		(52.1	)
Tax on profit		(225	)		(421	)		196			(46.5	)
Profit from continuing operations		484			1,060			(576	)		(54.4	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		484			1,060			(576	)		(54.4	)
Minority interests		0			0			(0	)		(93.0	)
Attributable profit to the Group		484			1,060			(576	)		(54.4	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking United Kingdom
Million pound sterling

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		1,018			1,003			1,019			991			943			900			883
Net fees		204			209			187			177			178			231			220
Gains (losses) on financial transactions		(2	)		11			(1	)		(38	)		14			30			(6	)
Other operating income*		5			6			5			6			3			4			2
Gross income		1,225			1,229			1,210			1,136			1,138			1,164			1,099
Operating expenses		(503	)		(509	)		(496	)		(494	)		(506	)		(496	)		(496	)
General administrative expenses		(436	)		(441	)		(435	)		(427	)		(430	)		(420	)		(418	)
Personnel		(251	)		(255	)		(252	)		(243	)		(262	)		(255	)		(274	)
Other general administrative expenses		(186	)		(187	)		(183	)		(184	)		(168	)		(165	)		(144	)
Depreciation and amortisation		(67	)		(68	)		(61	)		(67	)		(77	)		(77	)		(78	)
Net operating income		722			720			714			642			632			668			603
Net loan-loss provisions		(239	)		(217	)		(197	)		(173	)		(118	)		(113	)		(139	)
Other income		(5	)		(7	)		(8	)		(84	)		(36	)		(759	)		(27	)
Profit before taxes		478			495			509			385			477			(205	)		437
Tax on profit		(139	)		(129	)		(154	)		(106	)		(141	)		40			(124	)
Profit from continuing operations		339			366			355			279			336			(164	)		313
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		339			366			355			279			336			(164	)		313
Minority interests		0			0			0			0			(0	)		0			(0	)
Attributable profit to the Group		339			366			355			279			336			(164	)		313

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Latin America
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		10,800			9,623			1,177			12.2
Net fees		3,155			2,751			403			14.7
Gains (losses) on financial transactions		597			720			(122	)		(17.0	)
Other operating income*		(300	)		(186	)		(114	)		61.1
Gross income		14,252			12,908			1,344			10.4
Operating expenses		(5,909	)		(5,302	)		(607	)		11.5
General administrative expenses		(5,300	)		(4,795	)		(505	)		10.5
Personnel		(2,920	)		(2,541	)		(379	)		14.9
Other general administrative expenses		(2,380	)		(2,254	)		(126	)		5.6
Depreciation and amortisation		(609	)		(507	)		(102	)		20.2
Net operating income		8,343			7,606			737			9.7
Net loan-loss provisions		(4,211	)		(3,549	)		(662	)		18.7
Other income		(715	)		(666	)		(48	)		7.3
Profit before taxes		3,417			3,390			26			0.8
Tax on profit		(697	)		(645	)		(52	)		8.0
Profit from continuing operations		2,720			2,745			(26	)		(0.9	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		2,720			2,745			(26	)		(0.9	)
Minority interests		338			412			(73	)		(17.8	)
Attributable profit to the Group		2,381			2,334			48			2.0

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Latin America
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,975			3,272			3,376			3,354			3,545			3,596			3,658
Net fees		828			952			972			967			1,045			1,044			1,065
Gains (losses) on financial transactions		179			259			282			275			204			284			109
Other operating income*		(36	)		(69	)		(81	)		(82	)		(82	)		(123	)		(95	)
Gross income		3,945			4,414			4,548			4,515			4,713			4,802			4,737
Operating expenses		(1,601	)		(1,822	)		(1,878	)		(1,885	)		(1,933	)		(1,944	)		(2,033	)
General administrative expenses		(1,449	)		(1,647	)		(1,699	)		(1,685	)		(1,738	)		(1,741	)		(1,821	)
Personnel		(760	)		(874	)		(907	)		(942	)		(973	)		(957	)		(990	)
Other general administrative expenses		(689	)		(772	)		(792	)		(743	)		(766	)		(784	)		(831	)
Depreciation and amortisation		(152	)		(175	)		(179	)		(201	)		(195	)		(203	)		(212	)
Net operating income		2,344			2,592			2,670			2,629			2,780			2,859			2,704
Net loan-loss provisions		(1,256	)		(1,251	)		(1,042	)		(1,138	)		(1,239	)		(1,473	)		(1,500	)
Other income		(249	)		(186	)		(232	)		(55	)		(238	)		(270	)		(206	)
Profit before taxes		839			1,155			1,396			1,436			1,303			1,116			998
Tax on profit		(110	)		(233	)		(302	)		(389	)		(280	)		(187	)		(229	)
Profit from continuing operations		729			922			1,094			1,047			1,023			929			768
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		729			922			1,094			1,047			1,023			929			768
Minority interests		103			139			170			144			133			126			79
Attributable profit to the Group		626			783			925			903			890			803			689

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Latin America
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		15,180			12,619			2,561			20.3
Net fees		4,434			3,608			826			22.9
Gains (losses) on financial transactions		840			944			(104	)		(11.0	)
Other operating income*		(422	)		(244	)		(178	)		72.7
Gross income		20,032			16,926			3,106			18.3
Operating expenses		(8,306	)		(6,953	)		(1,353	)		19.5
General administrative expenses		(7,450	)		(6,288	)		(1,162	)		18.5
Personnel		(4,104	)		(3,332	)		(772	)		23.2
Other general administrative expenses		(3,345	)		(2,955	)		(390	)		13.2
Depreciation and amortisation		(856	)		(665	)		(191	)		28.8
Net operating income		11,726			9,973			1,752			17.6
Net loan-loss provisions		(5,919	)		(4,654	)		(1,265	)		27.2
Other income		(1,004	)		(874	)		(131	)		15.0
Profit before taxes		4,802			4,446			356			8.0
Tax on profit		(980	)		(846	)		(134	)		15.8
Profit from continuing operations		3,823			3,600			223			6.2
Net profit from discontinued operations		—			—			—			—
Consolidated profit		3,823			3,600			223			6.2
Minority interests		475			540			(64	)		(11.9	)
Attributable profit to the Group		3,347			3,060			287			9.4

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Latin America
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		4,111			4,151			4,357			4,548			4,847			5,167			5,166
Net fees		1,144			1,210			1,254			1,311			1,429			1,501			1,504
Gains (losses) on financial transactions		247			332			364			372			279			406			154
Other operating income*		(50	)		(89	)		(105	)		(110	)		(112	)		(175	)		(135	)
Gross income		5,452			5,603			5,871			6,120			6,443			6,899			6,689
Operating expenses		(2,213	)		(2,315	)		(2,425	)		(2,555	)		(2,642	)		(2,793	)		(2,870	)
General administrative expenses		(2,002	)		(2,092	)		(2,194	)		(2,284	)		(2,376	)		(2,502	)		(2,571	)
Personnel		(1,050	)		(1,111	)		(1,171	)		(1,276	)		(1,330	)		(1,376	)		(1,398	)
Other general administrative expenses		(952	)		(980	)		(1,023	)		(1,008	)		(1,047	)		(1,126	)		(1,173	)
Depreciation and amortisation		(211	)		(223	)		(231	)		(271	)		(266	)		(291	)		(299	)
Net operating income		3,239			3,289			3,446			3,566			3,801			4,106			3,819
Net loan-loss provisions		(1,735	)		(1,580	)		(1,338	)		(1,547	)		(1,694	)		(2,109	)		(2,117	)
Other income		(344	)		(231	)		(299	)		(81	)		(326	)		(387	)		(292	)
Profit before taxes		1,160			1,477			1,809			1,938			1,781			1,611			1,410
Tax on profit		(153	)		(301	)		(392	)		(521	)		(383	)		(273	)		(324	)
Profit from continuing operations		1,007			1,176			1,417			1,417			1,398			1,338			1,086
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		1,007			1,176			1,417			1,417			1,398			1,338			1,086
Minority interests		142			178			220			195			182			181			112
Attributable profit to the Group		866			998			1,197			1,222			1,216			1,157			974

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Brazil
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		7,928			6,797			1,131			16.6
Net fees		2,064			1,757			307			17.5
Gains (losses) on financial transactions		434			587			(154	)		(26.1	)
Other operating income*		(250	)		(147	)		(102	)		69.6
Gross income		10,177			8,995			1,182			13.1
Operating expenses		(4,062	)		(3,619	)		(444	)		12.3
General administrative expenses		(3,634	)		(3,284	)		(349	)		10.6
Personnel		(1,962	)		(1,696	)		(267	)		15.7
Other general administrative expenses		(1,671	)		(1,588	)		(83	)		5.2
Depreciation and amortisation		(429	)		(334	)		(94	)		28.2
Net operating income		6,114			5,376			738			13.7
Net loan-loss provisions		(3,498	)		(2,787	)		(710	)		25.5
Other income		(782	)		(620	)		(162	)		26.2
Profit before taxes		1,835			1,969			(134	)		(6.8	)
Tax on profit		(435	)		(432	)		(3	)		0.8
Profit from continuing operations		1,400			1,537			(138	)		(9.0	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		1,400			1,537			(138	)		(9.0	)
Minority interests		233			217			16			7.4
Attributable profit to the Group		1,167			1,320			(154	)		(11.6	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Brazil
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,096			2,291			2,410			2,407			2,613			2,643			2,671
Net fees		527			606			625			613			682			686			696
Gains (losses) on financial transactions		140			226			221			267			127			215			92
Other operating income*		(23	)		(60	)		(64	)		(69	)		(65	)		(112	)		(73	)
Gross income		2,740			3,063			3,192			3,218			3,357			3,433			3,387
Operating expenses		(1,095	)		(1,239	)		(1,285	)		(1,289	)		(1,339	)		(1,337	)		(1,386	)
General administrative expenses		(994	)		(1,126	)		(1,164	)		(1,152	)		(1,205	)		(1,192	)		(1,236	)
Personnel		(509	)		(579	)		(608	)		(638	)		(661	)		(640	)		(661	)
Other general administrative expenses		(485	)		(547	)		(556	)		(514	)		(544	)		(552	)		(575	)
Depreciation and amortisation		(100	)		(113	)		(121	)		(136	)		(134	)		(145	)		(150	)
Net operating income		1,645			1,824			1,907			1,929			2,018			2,096			2,001
Net loan-loss provisions		(958	)		(997	)		(832	)		(930	)		(1,031	)		(1,255	)		(1,213	)
Other income		(224	)		(179	)		(216	)		(113	)		(234	)		(266	)		(282	)
Profit before taxes		463			648			858			886			753			575			506
Tax on profit		(62	)		(145	)		(225	)		(300	)		(179	)		(104	)		(152	)
Profit from continuing operations		401			504			633			586			574			472			354
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		401			504			633			586			574			472			354
Minority interests		51			67			99			100			99			81			53
Attributable profit to the Group		350			437			534			486			475			391			301

* Including dividends, income from equity-accounted method and other operating income/expenses

Other information
Spread	16.13	16.23	15.81	15.42	15.84	16.17	15.41
Spread loans	15.26	15.29	14.73	14.29	14.72	15.05	14.23
Spread deposits	0.87	0.94	1.08	1.13	1.12	1.12	1.18

Retail Banking Brazil
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		11,143			8,913			2,230			25.0
Net fees		2,902			2,304			597			25.9
Gains (losses) on financial transactions		610			770			(161	)		(20.8	)
Other operating income*		(351	)		(193	)		(158	)		81.8
Gross income		14,303			11,795			2,509			21.3
Operating expenses		(5,710	)		(4,745	)		(965	)		20.3
General administrative expenses		(5,107	)		(4,307	)		(800	)		18.6
Personnel		(2,758	)		(2,224	)		(534	)		24.0
Other general administrative expenses		(2,349	)		(2,083	)		(266	)		12.8
Depreciation and amortisation		(603	)		(438	)		(164	)		37.4
Net operating income		8,594			7,050			1,544			21.9
Net loan-loss provisions		(4,916	)		(3,655	)		(1,261	)		34.5
Other income		(1,099	)		(812	)		(286	)		35.3
Profit before taxes		2,579			2,582			(4	)		(0.1	)
Tax on profit		(611	)		(566	)		(45	)		8.0
Profit from continuing operations		1,967			2,016			(49	)		(2.4	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		1,967			2,016			(49	)		(2.4	)
Minority interests		327			284			43			15.1
Attributable profit to the Group		1,640			1,732			(92	)		(5.3	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Brazil
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		2,896			2,905			3,111			3,262			3,573			3,798			3,772
Net fees		728			770			807			831			932			986			983
Gains (losses) on financial transactions		194			291			286			360			174			305			131
Other operating income*		(32	)		(77	)		(84	)		(93	)		(89	)		(159	)		(103	)
Gross income		3,786			3,888			4,121			4,360			4,590			4,931			4,783
Operating expenses		(1,513	)		(1,573	)		(1,659	)		(1,746	)		(1,831	)		(1,922	)		(1,957	)
General administrative expenses		(1,374	)		(1,430	)		(1,502	)		(1,562	)		(1,648	)		(1,714	)		(1,746	)
Personnel		(703	)		(736	)		(785	)		(864	)		(904	)		(920	)		(934	)
Other general administrative expenses		(671	)		(695	)		(718	)		(698	)		(744	)		(793	)		(812	)
Depreciation and amortisation		(139	)		(143	)		(157	)		(184	)		(183	)		(208	)		(211	)
Net operating income		2,273			2,315			2,461			2,614			2,759			3,009			2,826
Net loan-loss provisions		(1,324	)		(1,262	)		(1,070	)		(1,263	)		(1,409	)		(1,795	)		(1,712	)
Other income		(310	)		(223	)		(279	)		(157	)		(319	)		(381	)		(398	)
Profit before taxes		640			830			1,112			1,194			1,030			833			716
Tax on profit		(86	)		(188	)		(293	)		(402	)		(245	)		(151	)		(215	)
Profit from continuing operations		554			642			820			792			785			681			501
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		554			642			820			792			785			681			501
Minority interests		70			85			129			134			136			117			75
Attributable profit to the Group		483			557			691			658			649			565			426

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Brazil
Million brazilian real

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		18,177			15,869			2,308			14.5
Net fees		4,733			4,103			631			15.4
Gains (losses) on financial transactions		995			1,371			(377	)		(27.5	)
Other operating income*		(573	)		(344	)		(229	)		66.6
Gross income		23,332			20,999			2,333			11.1
Operating expenses		(9,314	)		(8,448	)		(866	)		10.2
General administrative expenses		(8,331	)		(7,667	)		(663	)		8.7
Personnel		(4,499	)		(3,959	)		(540	)		13.6
Other general administrative expenses		(3,832	)		(3,708	)		(123	)		3.3
Depreciation and amortisation		(983	)		(781	)		(202	)		25.9
Net operating income		14,018			12,551			1,467			11.7
Net loan-loss provisions		(8,020	)		(6,508	)		(1,512	)		23.2
Other income		(1,793	)		(1,446	)		(346	)		23.9
Profit before taxes		4,206			4,597			(391	)		(8.5	)
Tax on profit		(997	)		(1,008	)		11			(1.0	)
Profit from continuing operations		3,209			3,589			(380	)		(10.6	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		3,209			3,589			(380	)		(10.6	)
Minority interests		534			507			28			5.4
Attributable profit to the Group		2,675			3,083			(408	)		(13.2	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Brazil
Million brazilian real

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		5,219			5,208			5,443			5,541			5,955			6,068			6,154
Net fees		1,312			1,380			1,411			1,410			1,553			1,576			1,604
Gains (losses) on financial transactions		349			521			501			617			290			492			213
Other operating income*		(58	)		(139	)		(147	)		(160	)		(148	)		(256	)		(168	)
Gross income		6,822			6,970			7,208			7,408			7,650			7,879			7,803
Operating expenses		(2,726	)		(2,820	)		(2,902	)		(2,966	)		(3,052	)		(3,069	)		(3,193	)
General administrative expenses		(2,476	)		(2,564	)		(2,628	)		(2,653	)		(2,747	)		(2,736	)		(2,848	)
Personnel		(1,267	)		(1,319	)		(1,373	)		(1,470	)		(1,507	)		(1,469	)		(1,524	)
Other general administrative expenses		(1,208	)		(1,245	)		(1,255	)		(1,183	)		(1,240	)		(1,268	)		(1,324	)
Depreciation and amortisation		(250	)		(256	)		(274	)		(314	)		(305	)		(333	)		(345	)
Net operating income		4,096			4,150			4,306			4,442			4,598			4,810			4,610
Net loan-loss provisions		(2,385	)		(2,261	)		(1,861	)		(2,140	)		(2,349	)		(2,878	)		(2,793	)
Other income		(558	)		(400	)		(488	)		(258	)		(532	)		(611	)		(650	)
Profit before taxes		1,153			1,488			1,956			2,043			1,717			1,322			1,168
Tax on profit		(155	)		(337	)		(516	)		(694	)		(408	)		(238	)		(351	)
Profit from continuing operations		998			1,151			1,440			1,349			1,309			1,083			817
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		998			1,151			1,440			1,349			1,309			1,083			817
Minority interests		127			153			227			230			227			186			122
Attributable profit to the Group		871			999			1,213			1,119			1,082			898			695

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Mexico
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,081			1,098			(18	)		(1.6	)
Net fees		371			337			33			9.9
Gains (losses) on financial transactions		105			26			79			306.4
Other operating income*		(30	)		(25	)		(5	)		18.2
Gross income		1,527			1,436			90			6.3
Operating expenses		(631	)		(593	)		(38	)		6.4
General administrative expenses		(559	)		(521	)		(37	)		7.1
Personnel		(298	)		(268	)		(30	)		11.1
Other general administrative expenses		(261	)		(253	)		(7	)		2.9
Depreciation and amortisation		(73	)		(72	)		(1	)		1.5
Net operating income		895			843			52			6.2
Net loan-loss provisions		(259	)		(357	)		98			(27.4	)
Other income		54			(39	)		93			—
Profit before taxes		690			447			243			54.2
Tax on profit		(103	)		(47	)		(56	)		119.4
Profit from continuing operations		587			400			186			46.6
Net profit from discontinued operations		—			—			—			—
Consolidated profit		587			400			186			46.6
Minority interests		1			86			(85	)		(98.8	)
Attributable profit to the Group		586			314			272			86.5

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Mexico
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		346			384			368			351			351			355			375
Net fees		103			120			115			117			128			120			123
Gains (losses) on financial transactions		(1	)		7			20			(11	)		57			43			5
Other operating income*		(12	)		(3	)		(10	)		(2	)		(10	)		(6	)		(14	)
Gross income		436			508			492			455			526			511			489
Operating expenses		(184	)		(203	)		(206	)		(211	)		(199	)		(209	)		(223	)
General administrative expenses		(162	)		(176	)		(183	)		(186	)		(175	)		(185	)		(199	)
Personnel		(84	)		(91	)		(93	)		(95	)		(100	)		(100	)		(98	)
Other general administrative expenses		(79	)		(85	)		(90	)		(91	)		(75	)		(85	)		(101	)
Depreciation and amortisation		(21	)		(27	)		(24	)		(25	)		(24	)		(24	)		(24	)
Net operating income		252			305			286			244			327			302			267
Net loan-loss provisions		(133	)		(122	)		(102	)		(110	)		(74	)		(89	)		(95	)
Other income		(10	)		(20	)		(9	)		10			(6	)		(1	)		60
Profit before taxes		109			163			175			144			247			211			232
Tax on profit		2			(30	)		(19	)		6			(37	)		(35	)		(31	)
Profit from continuing operations		111			134			156			150			210			176			201
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		111			134			156			150			210			176			201
Minority interests		27			32			28			0			0			0			0
Attributable profit to the Group		84			102			128			150			209			176			200

* Including dividends, income from equity-accounted method and other operating income/expenses

Other information
Spread	12.08	11.42	11.23	10.98	10.67	10.44	10.26
Spread loans	10.03	9.50	9.20	8.93	8.58	8.40	8.27
Spread deposits	2.05	1.92	2.03	2.05	2.09	2.04	1.99

Retail Banking Mexico
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,519			1,440			79			5.5
Net fees		521			442			79			17.8
Gains (losses) on financial transactions		147			34			113			335.6
Other operating income*		(42	)		(33	)		(9	)		26.7
Gross income		2,146			1,884			262			13.9
Operating expenses		(887	)		(778	)		(110	)		14.1
General administrative expenses		(785	)		(684	)		(101	)		14.8
Personnel		(419	)		(351	)		(67	)		19.1
Other general administrative expenses		(366	)		(332	)		(34	)		10.3
Depreciation and amortisation		(102	)		(94	)		(8	)		8.7
Net operating income		1,258			1,106			153			13.8
Net loan-loss provisions		(364	)		(468	)		104			(22.2	)
Other income		75			(52	)		127			—
Profit before taxes		970			587			383			65.3
Tax on profit		(145	)		(62	)		(83	)		135.2
Profit from continuing operations		825			525			300			57.1
Net profit from discontinued operations		—			—			—			—
Consolidated profit		825			525			300			57.1
Minority interests		1			113			(112	)		(98.8	)
Attributable profit to the Group		823			412			411			99.9

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Mexico
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		479			488			474			477			480			509			530
Net fees		142			152			149			159			174			173			174
Gains (losses) on financial transactions		(1	)		9			26			(15	)		78			62			7
Other operating income*		(17	)		(3	)		(13	)		(3	)		(14	)		(9	)		(19	)
Gross income		602			646			635			618			719			735			691
Operating expenses		(254	)		(258	)		(266	)		(286	)		(272	)		(301	)		(315	)
General administrative expenses		(225	)		(223	)		(236	)		(252	)		(239	)		(266	)		(281	)
Personnel		(116	)		(115	)		(120	)		(129	)		(137	)		(144	)		(138	)
Other general administrative expenses		(108	)		(108	)		(116	)		(123	)		(102	)		(122	)		(142	)
Depreciation and amortisation		(29	)		(34	)		(30	)		(33	)		(33	)		(35	)		(34	)
Net operating income		348			389			369			332			447			435			377
Net loan-loss provisions		(184	)		(153	)		(131	)		(150	)		(101	)		(128	)		(135	)
Other income		(14	)		(26	)		(11	)		13			(8	)		(2	)		85
Profit before taxes		151			209			227			196			338			305			327
Tax on profit		2			(39	)		(25	)		7			(51	)		(51	)		(44	)
Profit from continuing operations		153			170			202			203			287			254			284
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		153			170			202			203			287			254			284
Minority interests		37			41			36			1			0			0			0
Attributable profit to the Group		116			130			166			202			286			254			283

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Mexico
Million new mexican peso

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		18,275			18,305			(30	)		(0.2	)
Net fees		6,269			5,623			646			11.5
Gains (losses) on financial transactions		1,771			430			1,342			312.4
Other operating income*		(502	)		(418	)		(83	)		19.9
Gross income		25,814			23,939			1,875			7.8
Operating expenses		(10,674	)		(9,885	)		(790	)		8.0
General administrative expenses		(9,445	)		(8,691	)		(755	)		8.7
Personnel		(5,036	)		(4,466	)		(570	)		12.8
Other general administrative expenses		(4,409	)		(4,225	)		(184	)		4.4
Depreciation and amortisation		(1,229	)		(1,194	)		(35	)		2.9
Net operating income		15,140			14,054			1,085			7.7
Net loan-loss provisions		(4,379	)		(5,943	)		1,563			(26.3	)
Other income		907			(656	)		1,563			—
Profit before taxes		11,667			7,456			4,211			56.5
Tax on profit		(1,747	)		(785	)		(962	)		122.6
Profit from continuing operations		9,920			6,671			3,249			48.7
Net profit from discontinued operations		—			—			—			—
Consolidated profit		9,920			6,671			3,249			48.7
Minority interests		17			1,439			(1,422	)		(98.8	)
Attributable profit to the Group		9,903			5,232			4,671			89.3

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Mexico
Million new mexican peso

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		6,107			6,129			6,069			5,901			5,789			5,980			6,506
Net fees		1,809			1,912			1,901			1,965			2,103			2,025			2,142
Gains (losses) on financial transactions		(16	)		117			328			(190	)		947			724			100
Other operating income*		(216	)		(35	)		(168	)		(34	)		(165	)		(101	)		(236	)
Gross income		7,685			8,123			8,130			7,642			8,674			8,629			8,512
Operating expenses		(3,240	)		(3,236	)		(3,409	)		(3,541	)		(3,281	)		(3,531	)		(3,862	)
General administrative expenses		(2,866	)		(2,805	)		(3,019	)		(3,126	)		(2,881	)		(3,122	)		(3,442	)
Personnel		(1,481	)		(1,444	)		(1,540	)		(1,601	)		(1,649	)		(1,686	)		(1,702	)
Other general administrative expenses		(1,385	)		(1,361	)		(1,479	)		(1,525	)		(1,232	)		(1,437	)		(1,740	)
Depreciation and amortisation		(374	)		(430	)		(390	)		(414	)		(400	)		(409	)		(420	)
Net operating income		4,446			4,888			4,721			4,101			5,393			5,097			4,650
Net loan-loss provisions		(2,347	)		(1,918	)		(1,678	)		(1,851	)		(1,223	)		(1,506	)		(1,649	)
Other income		(177	)		(333	)		(146	)		173			(93	)		(20	)		1,020
Profit before taxes		1,922			2,636			2,898			2,423			4,076			3,571			4,020
Tax on profit		30			(498	)		(317	)		95			(616	)		(595	)		(537	)
Profit from continuing operations		1,952			2,138			2,581			2,518			3,461			2,976			3,483
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		1,952			2,138			2,581			2,518			3,461			2,976			3,483
Minority interests		473			509			456			9			6			5			6
Attributable profit to the Group		1,479			1,629			2,125			2,510			3,455			2,971			3,477

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Chile
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,031			1,008			24			2.3
Net fees		280			256			24			9.3
Gains (losses) on financial transactions		8			25			(17	)		(67.0	)
Other operating income*		(14	)		(11	)		(3	)		22.8
Gross income		1,306			1,278			28			2.2
Operating expenses		(542	)		(478	)		(64	)		13.3
General administrative expenses		(480	)		(421	)		(58	)		13.9
Personnel		(303	)		(263	)		(41	)		15.5
Other general administrative expenses		(176	)		(159	)		(18	)		11.2
Depreciation and amortisation		(62	)		(57	)		(5	)		9.1
Net operating income		764			800			(36	)		(4.5	)
Net loan-loss provisions		(313	)		(260	)		(53	)		20.3
Other income		27			(4	)		31			—
Profit before taxes		478			535			(58	)		(10.8	)
Tax on profit		(52	)		(68	)		15			(22.6	)
Profit from continuing operations		425			468			(42	)		(9.0	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		425			468			(42	)		(9.0	)
Minority interests		103			106			(3	)		(3.0	)
Attributable profit to the Group		323			362			(39	)		(10.8	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Chile
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		308			349			350			348			332			356			343
Net fees		79			87			91			97			94			97			89
Gains (losses) on financial transactions		11			4			11			4			5			10			(7	)
Other operating income*		(3	)		(4	)		(4	)		(8	)		(5	)		(3	)		(6	)
Gross income		395			436			447			441			427			460			419
Operating expenses		(143	)		(168	)		(168	)		(175	)		(173	)		(179	)		(190	)
General administrative expenses		(124	)		(147	)		(150	)		(153	)		(152	)		(159	)		(169	)
Personnel		(75	)		(95	)		(93	)		(98	)		(93	)		(102	)		(108	)
Other general administrative expenses		(50	)		(52	)		(57	)		(56	)		(58	)		(57	)		(61	)
Depreciation and amortisation		(18	)		(20	)		(18	)		(22	)		(21	)		(20	)		(21	)
Net operating income		252			269			279			266			254			281			229
Net loan-loss provisions		(111	)		(83	)		(66	)		(56	)		(87	)		(91	)		(135	)
Other income		(7	)		9			(6	)		35			3			3			21
Profit before taxes		134			194			207			245			169			193			115
Tax on profit		(20	)		(28	)		(20	)		(51	)		(29	)		(14	)		(10	)
Profit from continuing operations		114			166			187			194			140			179			106
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		114			166			187			194			140			179			106
Minority interests		25			39			42			43			33			44			26
Attributable profit to the Group		90			127			145			151			107			135			80

* Including dividends, income from equity-accounted method and other operating income/expenses

Other information
Spread	7.49	7.33	7.03	6.69	7.47	7.04	6.83
Spread loans	5.24	5.03	4.76	4.52	4.38	4.14	4.18
Spread deposits	2.25	2.30	2.27	2.17	3.09	2.90	2.65

Retail Banking Chile
Million dollars

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,449			1,321			128			9.7
Net fees		394			336			58			17.2
Gains (losses) on financial transactions		12			33			(21	)		(64.6	)
Other operating income*		(20	)		(15	)		(5	)		31.7
Gross income		1,835			1,676			160			9.5
Operating expenses		(761	)		(627	)		(134	)		21.4
General administrative expenses		(674	)		(553	)		(122	)		22.0
Personnel		(427	)		(345	)		(82	)		23.8
Other general administrative expenses		(248	)		(208	)		(40	)		19.1
Depreciation and amortisation		(87	)		(75	)		(13	)		17.0
Net operating income		1,074			1,049			25			2.4
Net loan-loss provisions		(440	)		(341	)		(99	)		28.9
Other income		37			(6	)		43			—
Profit before taxes		671			702			(30	)		(4.3	)
Tax on profit		(74	)		(89	)		15			(17.1	)
Profit from continuing operations		598			613			(15	)		(2.5	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		598			613			(15	)		(2.5	)
Minority interests		145			139			5			3.9
Attributable profit to the Group		453			474			(21	)		(4.4	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Chile
Million dollars

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		426			444			451			472			454			511			484
Net fees		109			111			117			131			129			139			126
Gains (losses) on financial transactions		15			4			14			6			7			15			(10	)
Other operating income*		(5	)		(5	)		(5	)		(11	)		(7	)		(4	)		(9	)
Gross income		545			553			577			598			584			660			592
Operating expenses		(197	)		(213	)		(217	)		(237	)		(237	)		(257	)		(268	)
General administrative expenses		(172	)		(187	)		(193	)		(208	)		(208	)		(229	)		(238	)
Personnel		(103	)		(121	)		(120	)		(132	)		(128	)		(146	)		(153	)
Other general administrative expenses		(69	)		(66	)		(73	)		(75	)		(80	)		(83	)		(85	)
Depreciation and amortisation		(25	)		(26	)		(23	)		(29	)		(29	)		(29	)		(30	)
Net operating income		348			340			360			361			347			403			324
Net loan-loss provisions		(153	)		(103	)		(84	)		(77	)		(119	)		(130	)		(190	)
Other income		(9	)		12			(8	)		46			4			4			30
Profit before taxes		185			249			267			330			232			277			163
Tax on profit		(27	)		(36	)		(26	)		(68	)		(40	)		(20	)		(14	)
Profit from continuing operations		158			213			242			262			192			257			150
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		158			213			242			262			192			257			150
Minority interests		34			51			54			59			45			63			36
Attributable profit to the Group		124			163			187			204			147			193			113

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Chile
Million chilean peso

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		687,354			687,350			4			0.0
Net fees		186,782			174,899			11,883			6.8
Gains (losses) on financial transactions		5,585			17,296			(11,711	)		(67.7	)
Other operating income*		(9,258	)		(7,713	)		(1,544	)		20.0
Gross income		870,464			871,832			(1,368	)		(0.2	)
Operating expenses		(361,128	)		(326,205	)		(34,923	)		10.7
General administrative expenses		(319,799	)		(287,444	)		(32,354	)		11.3
Personnel		(202,295	)		(179,255	)		(23,039	)		12.9
Other general administrative expenses		(117,504	)		(108,189	)		(9,315	)		8.6
Depreciation and amortisation		(41,329	)		(38,761	)		(2,568	)		6.6
Net operating income		509,336			545,627			(36,290	)		(6.7	)
Net loan-loss provisions		(208,624	)		(177,514	)		(31,110	)		17.5
Other income		17,739			(2,912	)		20,651			—
Profit before taxes		318,451			365,201			(46,750	)		(12.8	)
Tax on profit		(34,920	)		(46,183	)		11,263			(24.4	)
Profit from continuing operations		283,531			319,017			(35,486	)		(11.1	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		283,531			319,017			(35,486	)		(11.1	)
Minority interests		68,544			72,357			(3,813	)		(5.3	)
Attributable profit to the Group		214,987			246,661			(31,673	)		(12.8	)

* Including dividends, income from equity-accounted method and other operating income/expenses

Retail Banking Chile
Million chilean peso

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		221,236			235,710			230,405			226,187			218,919			240,345			228,091
Net fees		56,453			58,778			59,668			63,338			62,186			65,194			59,402
Gains (losses) on financial transactions		7,783			2,207			7,306			2,458			3,335			6,984			(4,734	)
Other operating income*		(2,399	)		(2,625	)		(2,689	)		(5,499	)		(3,188	)		(2,039	)		(4,031	)
Gross income		283,072			294,069			294,690			286,484			281,252			310,484			278,728
Operating expenses		(102,300	)		(113,160	)		(110,745	)		(113,954	)		(114,043	)		(120,868	)		(126,217	)
General administrative expenses		(89,250	)		(99,372	)		(98,822	)		(99,877	)		(100,067	)		(107,459	)		(112,273	)
Personnel		(53,525	)		(64,259	)		(61,471	)		(63,786	)		(61,603	)		(68,694	)		(71,998	)
Other general administrative expenses		(35,725	)		(35,113	)		(37,351	)		(36,091	)		(38,464	)		(38,765	)		(40,275	)
Depreciation and amortisation		(13,050	)		(13,788	)		(11,923	)		(14,077	)		(13,976	)		(13,409	)		(13,944	)
Net operating income		180,773			180,909			183,945			172,530			167,209			189,616			152,511
Net loan-loss provisions		(79,676	)		(55,200	)		(42,638	)		(35,410	)		(57,416	)		(61,261	)		(89,947	)
Other income		(4,841	)		6,291			(4,363	)		23,611			1,849			1,805			14,086
Profit before taxes		96,256			132,000			136,944			160,730			111,642			130,159			76,649
Tax on profit		(14,136	)		(18,962	)		(13,085	)		(33,839	)		(19,302	)		(9,295	)		(6,323	)
Profit from continuing operations		82,119			113,039			123,859			126,892			92,340			120,865			70,326
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		82,119			113,039			123,859			126,892			92,340			120,865			70,326
Minority interests		17,593			26,845			27,918			28,319			21,616			29,791			17,136
Attributable profit to the Group		64,526			86,193			95,941			98,573			70,724			91,074			53,190

* Including dividends, income from equity-accounted method and other operating income/expenses

Global Wholesale Banking
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		1,825			1,720			104			6.1
Net fees		943			966			(23	)		(2.4	)
Gains (losses) on financial transactions		680			1,105			(424	)		(38.4	)
Other operating income*		187			106			81			76.0
Gross income		3,635			3,898			(262	)		(6.7	)
Operating expenses		(1,230	)		(1,104	)		(126	)		11.4
General administrative expenses		(1,124	)		(998	)		(127	)		12.7
Personnel		(733	)		(655	)		(78	)		11.9
Other general administrative expenses		(391	)		(342	)		(49	)		14.3
Depreciation and amortisation		(106	)		(107	)		1			(0.7	)
Net operating income		2,405			2,793			(388	)		(13.9	)
Net loan-loss provisions		(130	)		1			(131	)		—
Other income		(44	)		(18	)		(26	)		142.3
Profit before taxes		2,231			2,776			(545	)		(19.6	)
Tax on profit		(593	)		(738	)		145			(19.6	)
Profit from continuing operations		1,638			2,038			(400	)		(19.6	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		1,638			2,038			(400	)		(19.6	)
Minority interests		176			190			(14	)		(7.4	)
Attributable profit to the Group		1,462			1,848			(386	)		(20.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Business volumes
Total assets		296,818		302,351		(5,532	)		(1.8	)
Customer loans		74,960		69,865		5,095			7.3
Customer deposits		80,869		78,125		2,745			3.5

Global Wholesale Banking
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		549			628			543			615			572			635			618
Net fees		314			318			334			322			330			325			287
Gains (losses) on financial transactions		498			280			327			256			405			128			148
Other operating income*		2			77			27			60			30			113			45
Gross income		1,364			1,303			1,230			1,252			1,337			1,201			1,098
Operating expenses		(341	)		(381	)		(382	)		(387	)		(395	)		(418	)		(417	)
General administrative expenses		(311	)		(341	)		(346	)		(348	)		(359	)		(383	)		(382	)
Personnel		(193	)		(237	)		(226	)		(239	)		(235	)		(251	)		(247	)
Other general administrative expenses		(118	)		(104	)		(120	)		(110	)		(125	)		(132	)		(135	)
Depreciation and amortisation		(31	)		(40	)		(36	)		(39	)		(35	)		(35	)		(35	)
Net operating income		1,023			922			848			865			943			782			680
Net loan-loss provisions		48			(20	)		(28	)		(3	)		12			(100	)		(42	)
Other income		(8	)		(16	)		5			7			(13	)		(2	)		(29	)
Profit before taxes		1,064			886			826			869			941			681			610
Tax on profit		(279	)		(239	)		(221	)		(234	)		(242	)		(183	)		(168	)
Profit from continuing operations		785			648			605			635			699			497			442
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		785			648			605			635			699			497			442
Minority interests		71			62			57			51			57			56			62
Attributable profit to the Group		714			586			548			584			641			441			380

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Business volumes
Total assets		254,380		274,401		302,351		284,103		274,235		284,364		296,818
Customer loans		61,001		70,606		69,865		70,577		67,996		73,448		74,960
Customer deposits		58,003		72,429		78,125		84,600		93,825		89,624		80,869

Asset Management and Insurance
Million euros

							Variation
	9M ’11			9M ’10			Amount			%
Income statement
Net interest income		220			150			70			46.7
Net fees		288			317			(29	)		(9.2	)
Gains (losses) on financial transactions		(1	)		34			(35	)		—
Other operating income*		358			290			69			23.7
Gross income		865			791			74			9.4
Operating expenses		(258	)		(238	)		(19	)		8.0
General administrative expenses		(231	)		(216	)		(16	)		7.3
Personnel		(129	)		(120	)		(9	)		7.1
Other general administrative expenses		(103	)		(95	)		(7	)		7.5
Depreciation and amortisation		(26	)		(23	)		(3	)		14.8
Net operating income		608			552			55			10.0
Net loan-loss provisions		0			(0	)		0			—
Other income		(43	)		(15	)		(28	)		188.2
Profit before taxes		564			537			27			5.1
Tax on profit		(196	)		(145	)		(50	)		34.6
Profit from continuing operations		369			392			(23	)		(5.9	)
Net profit from discontinued operations		—			—			—			—
Consolidated profit		369			392			(23	)		(5.9	)
Minority interests		41			44			(3	)		(6.0	)
Attributable profit to the Group		328			348			(20	)		(5.9	)

* Including dividends, income from equity-accounted method and other operating income/expenses

					Variation
	30.09.11		30.09.10		Amount			%
Business volumes
Total assets		35,041		33,091		1,950			5.9
Customer loans		448		496		(47	)		(9.6	)
Customer deposits		5,489		3,449		2,039			59.1

Asset Management and Insurance
Million euros

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Income statement
Net interest income		38			52			60			82			71			74			76
Net fees		104			105			108			108			95			94			99
Gains (losses) on financial transactions		12			7			15			15			0			9			(10	)
Other operating income*		89			111			89			86			122			126			110
Gross income		243			276			272			291			288			302			275
Operating expenses		(74	)		(80	)		(85	)		(104	)		(86	)		(86	)		(85	)
General administrative expenses		(66	)		(72	)		(77	)		(80	)		(77	)		(77	)		(77	)
Personnel		(39	)		(40	)		(41	)		(41	)		(43	)		(43	)		(43	)
Other general administrative expenses		(27	)		(32	)		(37	)		(39	)		(35	)		(34	)		(34	)
Depreciation and amortisation		(8	)		(8	)		(7	)		(24	)		(9	)		(9	)		(8	)
Net operating income		169			196			187			186			202			216			190
Net loan-loss provisions		(0	)		(0	)		(0	)		0			(0	)		0			(0	)
Other income		(3	)		(6	)		(6	)		(2	)		(8	)		(2	)		(33	)
Profit before taxes		166			190			182			184			194			214			157
Tax on profit		(43	)		(54	)		(48	)		(55	)		(60	)		(77	)		(59	)
Profit from continuing operations		122			136			134			129			133			137			98
Net profit from discontinued operations		—			—			—			—			—			—			—
Consolidated profit		122			136			134			129			133			137			98
Minority interests		14			16			14			16			14			13			13
Attributable profit to the Group		108			120			120			113			119			124			85

* Including dividends, income from equity-accounted method and other operating income/expenses

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Business volumes
Total assets		31,573		32,065		33,091		33,060		33,060		35,846		35,041
Customer loans		690		553		496		459		471		448		448
Customer deposits		533		2,419		3,449		4,100		4,617		5,336		5,489

NPL ratio
%

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Continental Europe		3.73		3.87		4.01		4.34		4.57		4.77		5.05
Santander Branch Network		4.65		4.78		4.90		5.52		5.99		6.73		7.70
Banesto		3.13		3.49		3.83		4.11		4.31		4.54		4.69
Santander Consumer Finance		5.12		5.23		5.13		4.95		4.63		4.42		4.29
Portugal		2.32		2.40		2.43		2.90		3.03		3.25		3.78
Retail Poland (BZ WBK)												6.43		6.26
United Kingdom		1.88		1.85		1.77		1.76		1.75		1.82		1.88
Latin America		4.18		4.13		4.15		4.11		4.01		4.20		4.10
Brazil		5.04		5.01		4.97		4.91		4.85		5.05		5.05
Mexico		1.86		1.77		2.20		1.84		1.58		2.45		1.78
Chile		3.36		3.31		3.58		3.74		3.80		3.65		3.63
Sovereign		5.14		5.11		4.80		4.61		4.15		3.76		3.22
Operating Areas		3.32		3.35		3.39		3.53		3.59		3.76		3.84
Spain		3.59		3.71		3.88		4.24		4.57		4.81		5.15

NPL coverage
%

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Continental Europe		74		71		75		71		67		65		62
Santander Branch Network		59		53		55		52		50		47		41
Banesto		61		58		60		54		52		52		53
Santander Consumer Finance		108		111		122		128		122		128		132
Portugal		64		65		69		60		62		62		53
Retail Poland (BZ WBK)												67		69
United Kingdom		46		46		48		46		45		41		40
Latin America		107		105		103		104		107		105		102
Brazil		100		98		98		101		104		102		100
Mexico		268		257		199		215		234		165		176
Chile		99		97		94		89		89		89		88
Sovereign		65		67		72		75		82		85		93
Operating Areas		75		74		77		75		73		71		69
Spain		68		64		65		58		53		49		46

Spreads loans and deposits
%

	Q1 ’10			Q2 ’10			Q3 ’10			Q4 ’10			Q1 ’11			Q2 ’11			Q3 ’11
Santander Branch Network
Spread loans		2.10			1.94			1.83			1.83			1.90			1.97			2.03
Spread deposits		0.50			0.10			0.04			0.06			0.05			0.56			0.35
SUM		2.60			2.04			1.87			1.89			1.95			2.53			2.38
Retail Banking Banesto
Spread loans		2.02			2.00			1.92			1.99			2.03			2.08			2.12
Spread deposits		0.18			(0.35	)		(0.51	)		(0.52	)		(0.36	)		0.12			0.42
SUM		2.20			1.65			1.41			1.47			1.67			2.20			2.54
Santander Consumer Finance
Spread loans		5.90			6.19			6.72			6.94			6.69			5.99			5.98
Retail Banking Portugal
Spread loans		1.76			1.82			1.82			1.88			1.96			2.06			2.15
Spread deposits		0.09			0.10			0.21			0.23			0.12			(0.31	)		(0.47	)
SUM		1.85			1.92			2.03			2.11			2.08			1.75			1.68
Retail Banking United Kingdom
Spread loans		2.05			2.13			2.20			2.28			2.34			2.35			2.42
Spread deposits		(0.06	)		(0.14	)		(0.17	)		(0.25	)		(0.30	)		(0.38	)		(0.45	)
SUM		1.99			1.99			2.03			2.03			2.04			1.97			1.96
Retail Banking Brazil
Spread loans		15.26			15.29			14.73			14.29			14.72			15.05			14.23
Spread deposits		0.87			0.94			1.08			1.13			1.12			1.12			1.18
SUM		16.13			16.23			15.81			15.42			15.84			16.17			15.41
Retail Banking Mexico
Spread loans		10.03			9.50			9.20			8.93			8.58			8.40			8.27
Spread deposits		2.05			1.92			2.03			2.05			2.09			2.04			1.99
SUM		12.08			11.42			11.23			10.98			10.67			10.44			10.26
Retail Banking Chile
Spread loans		5.24			5.03			4.76			4.52			4.38			4.14			4.18
Spread deposits		2.25			2.30			2.27			2.17			3.09			2.90			2.65
SUM		7.49			7.33			7.03			6.69			7.47			7.04			6.83
Retail Banking Sovereign
Spread loans		1.94			1.96			2.04			2.08			2.16			2.24			2.22
Spread deposits		0.94			0.99			0.62			0.53			0.78			0.66			0.40
SUM		2.88			2.95			2.66			2.61			2.94			2.90			2.62

Risk-weighted assets
Million euros

	31.03.10		30.06.10		30.09.10		31.12.10		31.03.11		30.06.11		30.09.11
Continental Europe		255,020		259,823		258,576		255,254		247,738		252,424		249,316
Santander Branch Network		75,956		75,468		73,076		70,438		67,886		64,870		62,006
Banesto		61,027		61,112		59,039		57,914		53,818		52,122		53,885
Santander Consumer		50,004		51,487		55,131		56,991		60,103		60,175		59,586
Portugal		23,360		23,430		23,181		23,417		22,339		22,412		22,396
Retail Poland (BZ WBK)												9,353		7,677
United Kingdom		80,108		85,512		83,765		86,018		84,610		83,814		87,650
Latin America		148,152		164,467		166,518		176,073		171,431		176,039		155,566
Brazil		88,258		99,074		101,036		107,267		105,612		109,717		92,448
Mexico		19,833		21,548		22,099		22,325		21,786		22,537		19,745
Chile		19,752		21,904		22,687		24,175		23,217		23,520		21,191
Sovereign		44,225		49,278		38,737		38,811		36,562		36,260		37,001
Operating Areas		527,505		559,080		547,596		556,155		540,341		548,537		529,533
Corporate Activities		40,044		42,438		46,097		48,730		33,695		31,942		29,254
Total		567,549		601,518		593,693		604,885		574,036		580,480		558,787

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Banco Santander, S.A.
Date: October 31, 2011	By:	/s/ José Antonio Álvarez
		Name:	José Antonio Álvarez
		Title:	Executive Vice President