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Spain's Santander books Q2 record loss of 11.1 bln euros on writedowns

Credit: REUTERS/JUAN MEDINA

Spain's Santander on Wednesday reported a record net loss of 11.1 billion euros ($13 billion) in the second quarter after it booked writedowns reflecting a lower valuation of some previous acquisitions, mainly in Europe.

By Jesús Aguado

MADRID, July 29 (Reuters) - Spain's Santander SAN.MC on Wednesday reported a record net loss of 11.1 billion euros ($13 billion) in the second quarter after it booked writedowns reflecting a lower valuation of some previous acquisitions, mainly in Europe.

The euro zone's second-biggest bank by market value said it booked impairments worth 12.6 billion euros in the quarter due to the economic deterioration caused by COVID-19.

Of the total impairments, 10.1 billion related to goodwill and 2.5 billion to DTAs, an instrument that grants tax breaks to companies when reporting losses or against certain provisions.

The bank said the impairments would have no impact on its liquidity nor on its CET-1 capital ratio.

Excluding the extraordinary charges, underlying attributable profit fell 27% to 1.53 billion euros in the second quarter compared with the same quarter in 2019.

Separately, Santander also said it was proposing the payment of a scrip dividend (payable in new shares) equivalent to 10 cents per share for 2019, to be paid this year.

The board intends to resume paying a full cash dividend as "soon as market conditions normalise, subject to regulatory approvals and guidance," the bank said.

($1 = 0.8527 euros)

(Reporting by Jesús Aguado, Editing by Inti Landauro)

((jesus.aguado@thomsonreuters.com; +34 91 585 8339; Reuters Messaging: Reuters Messaging: jesus.aguado.reuters.com@reuters.net))

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