Palace Revolt in Eurozone’s Largest Bank

Don Quijones, freelance writer, translator in Barcelona, Spain. Raging Bull-Shit is his modest attempt to challenge the wishful thinking and scrub away the lathers of soft soap peddled by political and business leaders and their loyal mainstream media. This article is a Wolf Street exclusive.
Don Emilio Botn, for decades the undisputed Capo of Spanish banking, is dead. By contrast, the bank he leaves behind him, Grupo Santander, is both alive and kicking – at least to all outward appearances. It is now the largest bank by market capitalization in the Eurozone as well as one of the thirteen leading banks in the world – no mean feat given that when Botn III took the reins of the family business from his father, Santander was merely a midsized domestic bank with just a tiny smattering of overseas operations.
Now its operations quite literally span the Western hemisphere, with the mother country accounting for just 7% of the group’s profits. Brazil’s stuttering economy is its biggest source of lucre, last year bringing in roughly 23% of the Group’s total profits, with the U. S. and Mexico accounting for 10% each. In Europe, its biggest market is the UK (17% of profits), though the bank has interests throughout the continent, most notably in Germany (6%) and Poland (6%).
However, it is the New World, not the Old World, on which Santander now has its sights firmly set. Last year, Latin American markets represented 51% of the group’s total operating revenues. Despite its recent slowdown, the region remains Santander’s main strategic target for business growth. According to the Group’s own website, it has carved out leadership positions in the continent’s ‘most dynamic and solid economies’ – economies such as Brazil, Mexico, Chile, Uruguay, Peru, Puerto Rico and that hyper-dynamic, super-stable economy called Argentina.
Naturally, with so many of its eggs in just one basket – and one that is fast losing its allure – one can’t help but wonder what might happen should things, god forbid, go south, south of the Rio Grande. Just as importantly, now that the King of Debt is dead, who’ll be on hand to steady the ship should the South Atlantic Seas get a little choppy?

This post was published at Wolf Street on September 29, 2014.