Santander delays UK stock flotation

SANTANDER’S plans to float its British arm on the stock market this year have been delayed by uncertainty over new regulations on ringfencing and capital.

A float is now unlikely before 2015, with hopes of a London Stock Exchange listing dashed by a lack of clarity on how banks will have to split their retail business from risky ‘casino’ activities – a key proposal of the Independent Commission on banking.

Banks also fear stricter rules on capital and leverage, leaving investors in the dark on potential returns. UK chief executive Ana Botin wants to expand lending to small and medium-sized firms and believes Spanish-owned Santander is well placed to help exporters through its wide international network.

She has increased the number of relationship managers for SMEs to 650 from around 500 and corporate business centres to 50 from 34. Corporate lending rose 13pc, with £4.1bn of new loan facilities for SMEs.

Pre-tax profits rose 5pc to £921m in the UK and were up 85pc to £4.6bn for the whole group. Write-offs for bad loans and the cost of previous bad conduct halved to £695m. Santander is unlikely to need to set aside more to cover PPI mis-selling, with £260m still in the pot and payouts on claims running at £11m a month.

It attracted 232,000 new customers to its 123 current account from other providers, helping boost current account balances by 75pc to £27.9bn.

Mortgage lending rose £4bn to £18.4bn, despite the bank’s plans to reduce its exposure to high loan to value and interest-only home loans.