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Moody's Downgrade Santander

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moodys just today noticed a problem in Spain.

nice to know they are on the ball.

bonuses all round.

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moodys just today noticed a problem in Spain.

nice to know they are on the ball.

bonuses all round.

Didn't Moody's spot the house price crash and warn about all the sub-prime CDO's etc....?

Solid dependable firm always ahead of the curve.

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moodys just today noticed a problem in Spain.

nice to know they are on the ball.

bonuses all round.

They should stick to boat-building - they seem pretty shaky on finance.

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http://business.timesonline.co.uk/tol/busi...icle6731418.ece

Spain's Santander, which owns Abbey, Alliance & Leicester and part of Bradford & Bingley (B&B) in the UK, has beaten the gloom with a 30 per cent jump in profit in the first half of the year.

The bank also said it grew revenues by a fifth, while keeping costs down.

Santander has avoided the worst excesses of the banking crisis by maintaining conservative lending practices and picking up assets on the cheap.

As a result, Santander was able to increase lending to small businesses and individuals in the six months to June 30. Santander's figures come after Antonio Horta-Osorio, its UK chief executive, attended a meeting on Monday with Alistair Darling, the chancellor, along with the bosses of other major banks to discuss whether banks are lending enough.

Profits up and yet downgraded?

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Every small group of shops in Spain seems to have a retail branch of a bank in it. The fat years of endless mortgage lending has run into a brick wall! The cost base of Spanish banking must be huge compared to the UK. For that reason alone Santander and others are in for a chill.

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It was that tv add saying it was a "safe" bank and the high interest rate return wot did it for me.

I've posted on this before:

http://www.housepricecrash.co.uk/forum/ind...t&p=1321241

(The Masked Tulip @ Sep 18 2008, 10:49 AM)

Is the A&L Santander take-over a done deal now? I have been surprised in the past week not to hear any panic about A&L so assume that they are basically considered 'safe' now as part of Santander?

Of course, anyone know how safe or not Santander is as an organisation?

Santander has grown prodigiously over the last ten years to become one of the world's largest and safest banks, despite this being through a period where banking practises worldwide have led to massive failures across the world. The Spanish banking, legal and property systems are bywords for integrity and regularly vie with Switzerland's reputation in terms of having a faultless record.

On a different and entirely unrelated subject, everything you write on this website is public, and your identity can be found out through legal process.

Now your question was?

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Every small group of shops in Spain seems to have a retail branch of a bank in it. The fat years of endless mortgage lending has run into a brick wall! The cost base of Spanish banking must be huge compared to the UK. For that reason alone Santander and others are in for a chill.

Currently the Santander accounts with A&L, Abbey and B&B are all separate for the 50K compensation scheme but I would recommend keeping a close eye on this as they have already announced they are merging the brands.

Also I read somewhere that their subprime problems were due to lending to S. America rather than in Spain but then they also took on the B&B basket case which can't have helped

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They only took the savings business.

We lucky souls have the btl rubbish

I really couldn't believe our luck, not only NR but B&B as well.

The taxpayer is blessed. Plus we are still buying GM toxic crap aren't we?

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I've been wondering for a while how Santander seem to be surfing through the crisis.

Surely they must have some rubbish on the books, with all the hoovering up they've been doing?

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Currently the Santander accounts with A&L, Abbey and B&B are all separate for the 50K compensation scheme but I would recommend keeping a close eye on this as they have already announced they are merging the brands.

Also I read somewhere that their subprime problems were due to lending to S. America rather than in Spain but then they also took on the B&B basket case which can't have helped

B&B is not separate from Abbey.

The Santander Group has the following banking licences at the moment

Abbey National - includes Abbey, Asda, Bradford & Bingley and Cahoot

Alliance & Leicester - includes Alliance & Leicester Commercial, Billpay and National Girobank

GE Capital Bank - includes Edge

Cater Allen

Santander Totta - under the Portuguese scheme with passport registration here

Banco Sabadell - under the Spanish scheme with passport registration here

They only took on the deposit book from Bradford and Bingley, not any of the loans.

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Spain-based Banco Santander... is considering the sale of its Chilean insurance operations, reports Dow Jones, citing a spokesperson from the bank’s Chilean subsidiary.

from Insurance Day (no link) - so they're finding problems in South America - lets try and flog it.

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Abbey is one of the BIG players now in mortgage lending isn't it , but the profits they are showing now I assume are based on mortgages being given on hugely overvalued properties to hugely overextended buyers, I think they give high loan to values still using the "affordability" criteria that has left the country bankrupt

Abbey and A&L were downgraded in April when Moodys said:

Moody’s said it had changed its assumptions about UK house prices in the past few months. It also stress-tested the mutuals’ commercial loan portfolios, where it expects the performance to worsen during the next few years.

Marjan Riggi of Moody’s said: “What’s different is the loss expectation is higher than it was three or four months ago looking at the economic forecasts on housing.

“Last year we were looking at mortgage lenders and stress-testing a 25 per cent fall in house prices. In the past three or four months that assumption has changed to a 40 per cent fall, which is a considerable difference.â€

On Wednesday Adrian Coles, director-general of the Building Societies Association, said Moody’s had included an extreme stress test of a 60 per cent fall in house prices....

A&L was downgraded from C to E !! Which I assume was a reflection on Santander. Of course the joke is that Santander were going to get rid of name of Abbey and A&L to Santander. I believe they had just had all the stationary printed for Abbey Santander when Abbey was downgraded so they were about to change it to Santander .....perhaps HPCrashers could suggest a new name for them!!

.

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Reality check.

Granted, Spain is in deeeeep sh1t, I myself have been shoting from the rooftops about it countless times on HPC.

However, Santander is firmly in the TBTF category.

Too Big To Fail - it just ain't going to happen, as it would mean global systemic failure. "They" won't let it happen.

And if you read Moody's report carefully, this is what they actually say:

http://www.moneymarketing.co.uk/cgi-bin/it...h=341&f=342

...Cabanyes does admit that Santander remains among the highest rated banks globally. She says this is reflected in the robustness and sustainable profitability of their retail-focused, geographically diversified activities.

She says: “We take further comfort from the availability of such support which Santander would very likely receive in the unexpected case of need as one of the Spanish banking system's largest bank.â€

So, I think conspiracy theories are misplaced on this one.

Warren Buffett is the largest share owner in Moodys.

Has he shorted Santander by any chance?

Well, if he has, it isn't going very well: the stock is up on the day :P

http://finance.yahoo.com/q?s=SAN.MC

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B&B is not separate from Abbey.

The Santander Group has the following banking licences at the moment

Abbey National - includes Abbey, Asda, Bradford & Bingley and Cahoot

Alliance & Leicester - includes Alliance & Leicester Commercial, Billpay and National Girobank

GE Capital Bank - includes Edge

Cater Allen

Santander Totta - under the Portuguese scheme with passport registration here

Banco Sabadell - under the Spanish scheme with passport registration here

They only took on the deposit book from Bradford and Bingley, not any of the loans.

Thanks

I posted from memory but the merger will affect people people with substantal funds in both Abbey and A&L as well as the smaller banks you quote. I think it is due to happen in January

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