Santander UK turns to more cost-cutting after profit slip

Santander UK said it expects to make more efficiencies after its profit slipped in the first nine months of the year due to a drag from restructuring costs and motor finance costs. The UK arm of Spain’s Banco Santander reported a £1.2bn pre-tax profit for the nine months ending 30 September, down six per cent on the same period last year. It came despite net interest income jumping 17 per cent to £3.9bn following the addition of high street lender TSB, which Santander completed the purchase of in April. The unit has added £96m in pre-tax profit to Santander’s bottom line since its first inclusion in May. But TSB also added £327m of operating costs and a £62m one-off ‘day one’ credit charge. Restructuring and specific provisions rose 269 per cent to £495m, from £134m a year earlier, weighing on profit for the year-to-date. The largest named driver was a £179m increase in motor finance provisions, booked in the first quarter, taking the bank’s total provisions to £616m.