Santander on the lookout for acquisitions

Spanish bank Santander, who took over Abbey National in November 2004, was believed to be in negotiations to buy mortgage bank Alliance & Leicester but talks faltered after both parties failed to agree a price, according to sources close to the group.

It is also believed that Santander turned down the assets of Northern Rock.

The negotiations were part of a strategy by the Spanish bank to complete its global footprint that has led it to analyse the current turbulence in the financial markets for acquisition opportunities.

The Spanish group is now the world’s eighth-largest bank and Emilio Botín, Santander’s chairman, said they are very close to their ideal size now. He added that the group wants to increase its presence in countries with sizeable stakes but has ruled out any significant acquisition in Asia.

The bank has a market value of $136 billion, with €900bn ($1,330 billion) in assets in Spain and Portugal, Latin America and the UK.

Last year, Santander doubled its size in Brazil (its biggest market in Latin America) with the acquisition of Banco Real that resulted from the break-up of ABN Amro.

In the US, Santander’s only big investment is a 24.9% stake in Sovereign Bancorp, a small lender on the east coast whose shares have dropped since Santander acquired their stake in 2006.

Here in the UK, Santander has announced that it wants Abbey to increase in market share, currently about 9.4%, although this could prove challenging in a property market that is slowing down.

Once the integration of Santander’s IT platform is completed, the group plans to commence expanding its UK branch network.

Story link: Santander on the lookout for acquisitions