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Santander exec discusses Latin American business, sees double-digit growth

Date: Monday 02 Jul 2012

Santander exec discusses Latin American business, sees double-digit growth

Banco Santander’s director for Latin America, Jesús Zabalzo, spoke with Spanish daily El Pais in an interview over the weekend and offered the Spanish bank's outlook for its Latin American businesses; he said that the group expects to see double-digit earnings growth through to 2015.

Zabalza recently replaced Francisco Luzón at the Latin America division. He explained that the group’s future in the region would not be very different although they each have their own management style.

In reference to statements made by Santander Chief Executive Alfredo Saenz regarding an overheating economy in Turkey and Brazil, Zabalzo ruled out such a scenario for Brazil. Zabalzo said that there would be a calm transition with a smooth landing to last a little over a year before returning to growth. He added that defaults may bounce at first before falling and although the bad debt rate is near 5%, margins remain elevated.

In regards to the Mexican market, a 25% stake of the subsidiary there may be floated in the local stock exchange only if the market recognises its true value, said Zabalzo. "Analysts speak of €15-20bn. We hired investment banks to prepare the listing but we cannot give further details due to market reasons. I think that if we go public, we will force other foreign banks to do the same."

Discussing the Mexican presidential elections, Zabalzo said that there will be no operational changes in the country regardless of who wins. He explained that Mexico is not a failed state in spite of the drug-trafficking problem.

Concerning the Argentina-YPF conflict, Zabalzo explained that the group has a comfortable dialogue with local authorities and expects the Repsol case to reach a satisfactory conclusion.

By 17:04, shares were down 0.17% at €5.21 in Madrid.

MJ

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