Santander looking to raise £6bn in cash call

SANTANDER, the biggest bank in the eurozone, has announced plans to raise a hefty £6bn from shareholders in a fundraising to bolster its capital position and possibly fund a large acquisition.

Shares in Santander were suspended on the Madrid stock exchange in anticipation of the announcement, which some market watchers suggest may pave the way for a bid for embattled Italian bank Monte Paschi di Siena.

Shares in the Italian bank, which put itself up for sale after a poor show in recent bank stress tests, were briefly suspended after rising 10pc on the speculation.

Santander started off as a small regional bank in Spain and became a global powerhouse under the guidance of veteran banker Emilio Botin, who passed away last year.

His daughter, Ana Botin, took the helm four months ago after running the UK business for the last four years. Baroness Vadera took over the UK division after her departure, which includes Abbey, Alliance & Leicester and Bradford & Bingley.

Santander itself is believed to have passed the stress tests, albeit with a weaker balance sheet than some of its European peers.

The cash-call, which is expected to take place overnight, will amount to some 10pc of the banks’ capital value.

Botin, who has stamped her mark by replacing key executives since taking over as chairman, also announced a cut in the dividend yesterday.