Impairment charges take their toll on Santander

High street banking giant Santander has revealed a 21 per cent slump in profit after taking another hit from failed construction giant Carillion and suffering “competitive pressures”.

The Spanish-owned lender said pre-tax profits tumbled to £414 million in the first three months of 2018, from £525m a year earlier.

It took a £60m impairment charge, including a further writedown on Carillion as well as another firm, understood to be fellow outsourcer Interserve. Santander added that it would fail to meet its target for 4.7 million loyal retail customers this year, with current numbers standing at four million as it has struggled to attract savings deposits.

Rates on a number of its savings products have not been increased since the rate hike last November, while its everyday and instant deposit accounts remain below the 0.5 per cent base rate.

It expects the UK economy to continue growing this year “at a similar pace” to 2017.