Santander profits hit

Profits at Santander’s UK arm dived by a fifth as borrowers ditched a rip-off mortgage deal.

Around £1.7billion of home loans on the bank’s fallback standard variable rate – currently 4.74% – was repaid or moved elsewhere in the first three months of this year.

Competition also limited rate rises on other mortgage products.

Meanwhile, the amount held in Santander 123 current accounts – which pays 1.5% interest – jumped £500million to £67.8bn.

The combination of making less from borrowers and paying more to savers meant profits fell 21% to £414m in between January and March. Santander was also hit by the fallout from construction giant Carillion’s collapse and problems at outsourcing giant Interserve.