Investing
Santander’s Polish unit could pay 100% dividend, CEO says
Published by Jessica Weisman-Pitts
Posted on October 29, 2024
2 min readLast updated: January 29, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on October 29, 2024
2 min readLast updated: January 29, 2026
By Mateusz Rabiega
GDANSK (Reuters) -The Polish arm of Spanish lender Santander could pay dividends reaching 100% of annual profits, supported by its results and capital position, but would need the regulator to raise its limits, CEO Michal Gajewski said on Tuesday.
In the past year, the bank paid out 4.56 billion zlotys ($1.13 billion) of dividends, consisting of 75% of yearly profit and funds from dividend capital, in line with the regulator’s current maximum for the bank.
Asked about possibility of dividend payments reaching 100% in this and future years, Gajewski said that Santander Bank Polska could pay such dividends, however it was restricted by the recommendations of the Polish Financial Supervisory Authority (KNF).
“When it comes to dividends, we are of course awaiting for KNF’s recommendation. We have a very strong capital position … our strategy is to pay them regularly and in the biggest scale possible, but it is dependent on the KNF decision,” Gajewski told reporters.
Troubled with legal aftermath of Swiss franc mortgages, Polish banks have found themselves unable to get approval from the regulator for full dividend payments.
Between 2019 and 2022, the KNF recommended top lenders to keep hefty chunks of their profits, and later advised them to temporarily hold off dividends altogether due to the uncertainties surrounding the COVID pandemic.
It has gradually eased the conditions for sector dividends, as the risks, including the impact of Swiss franc mortgages, have subsided.
The KNF is likely to make its recommendation in the coming months, with previous rulings coming in either the fourth quarter of the same year or the first quarter of the following year.
The stock was up 5.6% at 1112 GMT, outperforming Warsaw blue-chip index.
The lender posted a 27% jump in third-quarter net profit, supported by lower provisions for loans in Swiss francs, ending the period with 1.94 billion zlotys of profits, having beat expectations.
($1 = 4.0222 zlotys)
(Reporting by Mateusz Rabiega; Editing by Clarence Fernandez, Jan Harvey and Alison Williams)
A dividend is a portion of a company's earnings distributed to shareholders, typically in cash or additional shares. It reflects the company's profitability and is often paid regularly.
Capital position refers to the amount of capital a bank or financial institution has available to meet its obligations and support its operations. A strong capital position indicates financial stability.
The KNF is the regulatory body responsible for overseeing the financial market in Poland, including banks, insurance companies, and investment firms, ensuring their compliance with laws and regulations.
Annual profits are the total earnings a company generates over a fiscal year after deducting all expenses. They are a key indicator of a company's financial performance.
Swiss franc mortgages are loans denominated in Swiss francs, often used in Poland. They have been controversial due to currency fluctuations affecting borrowers' repayment amounts.
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