Spanish banking giant Santander today said UK profits increased by more 15% after it lifted its share of the mortgage market to 20% in the first three months of the year.
The lender, which completed the rebranding of its Abbey and Bradford & Bingley branches in January, said the leap in trading profits to £426 million came as UK revenues rose by around 8% in the first quarter.
It now claims a fifth of UK gross mortgage lending, at £5.7 billion and up from 18% in 2009 and 15% in the first quarter of last year.
Net deposits soared by 240% to £3 billion year-on-year across retail, corporate and private banking.
Santander, which is also rebranding the Alliance & Leicester chain this year, revealed net mortgage lending of £1.4 billion in the first quarter, up on the £800 million seen a year earlier. The figure, which includes repayments and redemptions, was down from £2.5 billion at the end of 2009.
In a further sign that borrowers remain under pressure, it has set aside more to cover bad debts - up 8% to £204 million compared with a year earlier.
Santander predicted that UK economic conditions will remain challenging this year, with interest rates remaining low throughout 2010.
It said: "House purchases volumes are higher than a year ago, but remain low relative to the past decade.
Santander took advantage of the banking crisis to steal further market share in the UK, snapping up Alliance & Leicester and the savings arm of Bradford & Bingley in a move that left it with more than 25 million customers and 1,300 branches.
It bought Abbey in 2004, marking its first step on the UK high street.
And the group is also one of the front runners to acquire 318 Royal Bank of Scotland branches, which are being put up for sale to appease competition concerns.
It is thought to be one of four contenders left in the bidding process, alongside rival Spanish bank BBVA, Virgin Money and Clydesdale and Yorkshire Bank parent National Australia Bank.
Today's first quarter figures show that the wider Santander business also delivered an increase in profits, up by a better-than-expected 6% to 2.21 billion euros (£1.9 billion).Reuse content