By Xavier Fontdegloria
Banco Santander SA on Wednesday said it is set to outperform its profitability guidance after reporting higher earnings in the third quarter on increased revenues and lower provisions.
The Spanish lender reported a net profit of 2.17 billion euros ($2.52 billion) from July to September, compared with a EUR1.75 billion profit in the same period a year earlier. The figure is above analysts' expectations of EUR2.03 billion, according to a consensus provided by FactSet.
Revenue rose to EUR11.93 billion from EUR11.09 billion a year earlier, above estimates from analysts of EUR11.60 billion. Net interest income--the difference between what banks earn on loans and what they pay clients for deposits--climbed to EUR8.46 billion from EUR7.77 billion a year ago.
Net loan-loss provisions decreased 13% to EUR2.22 billion in the third quarter, the bank said.
Banco Santander said it is well on track to significantly outperform its profitability target for 2021, which is based on an underlying return on tangible equity--a key measure of profitability--of 9% to 10% for 2021. In the third quarter, the underlying RoTE stood at 12.56%.
Fully-loaded core tier 1 ratio was at 11.85% at the end of September, within the bank's 11% to 12% target.
Write to Xavier Fontdegloria at xavier.fontdegloria@wsj.com
