Santander takes jab at City watchdog as motor finance bill balloons
Santander has took another major swipe at the City watchdog after the banking giant hiked its provisions for the motor finance scandal.
As it reported full-year results, the bank said its bill for the car mis-selling saga had reached £461m, building on a previous £295m provision.
It follows the bank’s UK arm missing its third-quarter results due to “uncertainty” following the financial watchdog’s motor finance redress scheme.
Mike Regnier, the UK chief at Santander, said the current proposals in the redress scheme could cause “significant” harm to consumers, jobs and the broader economy.
Santander joins the likes of Lloyds, Barclays and Close Brothers, which have all drastically increased provisions amid further details about the regulator’s redress scheme as they braced for a costly hit.
Regnier warned in October if the government does not intervene “the unintended consequences for the car finance market, the supply of credit and the resulting negative impact on the automotive industry and its supply chain could significantly impact jobs, growth and the broader UK economy.”
The bank said it recorded a lower provision in the fourth quarter of 2025 for complaints related to motor finance dealer commissions at £134m when compared with the year prior at £223m.
The fresh comments came Spanish banking giant recorded €20.9bn (£18bn) in pre-tax profit for the last 12 months as revenue climbed to €62.4bn. This was boosted by a five per cent increase in fee income to a record of €13bn.
Operating expenses fell one per cent to €25.8bn.
But in the group’s filing for UK, progress lagged behind with profit broadly flat when measured in constant euros at €1.3bn (£1.5bn). However, in UK-focused results which accounts for multiple of the UK arms subsidiaries pre-tax profit increased by £180m to £1.5bn after higher income and lower provision costs.
Following the fourth-quarter results Santander kicked off a €5bn share buyback.
Santander’s shopping spree
Last night, Santander confirmed it had struck a $12.2bn deal to snap up US-based Webster Financial in a bid to ramp up its presence in the US.
The takeover will place Santander in the top-10 biggest retail and commercial banks in the US when measured by assets.
Webster is valued at $75 a share in the deal with $48.75 in cash and the remainder in stock.
It marks the latest move in Santander’s M&A strategy after the bank was speculated to beat out its peers in the UK to purchase TSB Bank for a deal expected to amount to £2.9bn.
TSB will add five million customers, £34bn in mortgages and £35bn in deposits to Santander’s portfolio, as well as its 218 branches.
Regnier announced his departure from the bank last year stating he will exit in the first quarter of 2026 after stating it was his intention to “move on after 4-5 years” due to “other interests [he] would like to pursue”.
The said that due to the integration of TSB taking “considerably longer than this”, he suggested his departure to the board to allow them time to find a successor.
Santander named group chief risk officer Mahesh Aditya as the new UK chief last week with Aditya expected to take the helm on 1 March.