Borja Ramirez

Borja Ramirez inquired about the funding cost synergies from Webster's deposits, specifically how they might improve funding for the auto business, and how the combined entity's improved diversification and 100% loan-to-deposit ratio could enable better future growth.

Answer

Ana Botín, Executive Chair of Santander, confirmed that the loan-to-deposit ratio will reach 100% and the average cost of deposits for the combined bank will decrease by approximately 40 basis points, largely due to Webster's strong HSA and retail/commercial funding. She stated this improvement should allow for faster growth on the consumer side, not only due to better funding but also from the diversification into a traditional retail commercial bank model, which is expected to drive overall faster growth.

Borja Ramirez inquired about the expected funding cost synergies from Webster's deposit base, particularly how it would benefit the auto business, and whether the improved diversification and 100% loan-to-deposit ratio would enable better growth for the combined entity.

Answer

Executive Chair Ana Botín confirmed that the loan-to-deposit ratio would reach 100% and the average cost of deposits for the combined bank would decrease by approximately 40 basis points, largely due to Webster's Health Savings Accounts (HSA) franchise. She stated that this improved funding and diversification would allow for faster growth, especially on the consumer side, and reduce the overall cost of funding.

Borja Ramirez from Citi inquired about the expected funding cost synergies from Webster's deposit base, particularly how they might improve funding costs for the auto business. He also asked if the improved diversification and 100% loan-to-deposit ratio would enable better growth for the combined business going forward.

Answer

Ana Botín (Executive Chair, Banco Santander) confirmed that the loan-to-deposit ratio will reach 100% and the average cost of deposits for the combined bank will decrease by about 40 basis points, largely due to Webster's sticky, low-cost HSA deposits and strong retail/commercial funding. She affirmed that this improved funding and diversification should allow for faster growth, especially on the consumer side, as the combined entity will resemble a traditional retail commercial bank.

Borja Ramirez inquired about the funding cost synergies from Webster's deposits, specifically how they might allow for better funding costs for the auto business. He also asked how the improved diversification and 100% loan-to-deposit ratio could enable better growth for the combined business going forward.

Answer

Ana Botín (Executive Chair) confirmed that the loan-to-deposit ratio would reach 100% and the average cost of deposits for the combined bank would decrease by approximately 40 basis points, largely due to Webster's sticky, low-cost HSA deposits. She stated that this improved funding and diversification would indeed allow for faster growth on the consumer side, as the combined entity would resemble a traditional retail commercial bank.