Company Profiles - The Latest Impressions on Santander and BBVA (2)
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by: Guest
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Santander was the only bank that profited for the acquisition of the ABN AMRO, Both Fortis and RBS experienced problems with their part of the acquisition. That was one of the reasons that Santander was only slightly affected by the credit crisis, the other reason was that their exposure to it was near zero...
Santander's President Emilio Botin saw the crisis as an opportunity to expand the banks' foreign presence: ... it acquired a stake in Sovereign Inc. in 2005 and 2006 and expanded this stake recently. It bought Alliance & Leicester Plc and branches and deposits of Bradford & Bingley Plc in the U.K.
It must be said that this strategy is restricted to the retail-banking. In that sense its focus is clear and is not deviated by recent opportunities. Retail banking is what strong bank in the future will have to rely on.
But what is happening in Spain in the home market of Santander?
There it appears that its main rival is taking the lead. Recently BBVA launched a commercial in which it offers clients about 2000 euros discounts when they transfer their mortgage from the old bank to BBVA (1).
Where Santander seems to be predominantly focused on its external strategy, BBVA is taking this crisis as an opportunity to strengthen its presence in the local market. The recent move (1) can be seen as an attack against ING Direct, which offers discounts but because of their online formula.
The home base will always remain as the main fundament for future growth and so far, BBVA seems to acknowledge that more than Santander.
This is reflected again in the stock quotes of both companies: BBVA quotes around 10, Santander around 9 (price-earnings of 6,4 against 6,2 and increasing in favor of BBVA).
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