Santander’s Botin Speeds Up Americas Pivot With Polish Unit Sale

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(Bloomberg) — Since Donald Trump’s sweeping tariffs upended global markets, many investors have turned their backs on the US. Not so the European Union’s most valuable bank.

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If anything, Banco Santander SA is accelerating its pivot to the Americas. 

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The Spanish lender on Monday agreed to sell much of its Polish operations in a €7 billion ($7.9 billion) transaction, with half of the capital released by the sale earmarked for growth in other regions, including the Americas. 

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The deal, one of the largest in European finance in recent years, is part of a strategic shift under Ana Botin, who took over as executive chairman in 2014. The 64-year-old is cutting back in some European countries to free up resources for growth in markets such as Mexico and the US, where Santander has hired extensively for its investment bank. 

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While the prospect of a global trade war has complicated that pivot, Santander is betting the Americas will provide better opportunities in the long run.

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“We want to be a relevant bank in the US,” Chief Financial Officer Jose Garcia Cantera said in an interview last week, responding to a question about the impact of the Trump turmoil. “This is a long-term strategy.”

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Behind Botin’s vision is a long-running frustration in the industry with Europe’s lack of growth. Since the end of the financial crisis, bank stocks in the region have mostly trailed their American peers, as the region suffered from strict regulation, negative interest rates and a still fragmented market for banking services. 

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The trend reversed, however, over the past three years, with European banks doubling in value while their US peers stagnated when adjusting for currency swings. That period overlaps with a push by Santander to build out its business in the US.

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The Spanish lender in 2022 acquired Amherst Pierpoint Securities and soon after started hiring aggressively for its US investment bank. More recently, it began rolling out a retail offering known as Openbank across much of North America to help attract deposits, a cheap source of funding. It also pledged $2 billion of investments in Mexico and obtained a banking license for Canada.

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The tariff turmoil hasn’t changed that strategy. Unless the world changes dramatically, say people familiar with the lender, Santander is open to considering small bolt-on purchases in Mexico and the US. Somewhat bigger deals are possible down the line, the people said, requesting anonymity to discuss private information. Santander three years ago unsuccessfully tried to buy Citigroup Inc.’s Mexican consumer business Banamex.

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A spokesperson for Santander referred to remarks by Botin on Monday, who said any deals would be “bolt-on” and “not transformational.” 

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To help fund the pivot, Santander is reviewing some European businesses. It has been pulling money out of the UK and recently announced a plan to eliminate 750 roles there, following an announcement in October to cut 1,425 job. The bank previously considered divesting assets in the UK and may consider doing so again if it felt it may fetch a good price, Bloomberg News reported in November. Botin has since said the UK operations aren’t for sale.