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Santander admits that technology and mobile banking can have an adverse impact on the branch network



The entity believes that competition may require an increase in deposit rates or a reduction in lending rates.

The growing use of new technologies and platforms for mobile banking and the Internet may require changes in Santander's commercial banking strategy, as the entity admits in its latest leaflet of ongoing activities sent to the National Securities Market Commission. (CNMV).

Specifically, if the processing rate increases, it may require the closing or the sale of some agencies and the restructuring of others, as well as an adjustment among their employees.

Accordingly, Santander estimates that this transformation will result in "losses in these assets and in the forcing of expenses to renew, reconfigure or close branches and transform the commercial network".

"Failure to effectively implement these changes can have a material adverse impact on the group's competitive position," said the entity in the document, adding that "substantial" expenses are also needed to modify or adapt its existing products and services. the new needs of customers.

In fact, the bank headed by Ana Botn points out that if the group can not adapt its offer to changes in the sector's trends, the business could be adversely affected. "The inability to anticipate or adapt to emerging technologies or changes in customer behavior, including young customers, may delay or prevent access to new markets based on digital technology," he points out.

Non-traditional providers

On the other hand, Santander recognizes that non-traditional providers of banking services, such as those specializing in e-commerce through Internet platforms such as Amazon, mobile phone companies such as Orange or search engines such as Google, regulatory advantages over traditional entities.

These companies are not subject to the strong banking regulation that traditional financial institutions are subject to, which is why Santander believes they can offer more aggressive rates and prices, as well as dedicate more resources to technology, infrastructure and marketing.

In this sense, the bank recognizes that if competition continues to increase, it will have to raise the deposit rates or lower the rates it applies to loans, thereby undermining their profitability. New entrant entry can also affect your business results and prospects because the ability to grow your customer base and expand your operations will be limited.

In sum, Santander argues that the success of its operations and profitability depend in part on the success of new products and services and its ability to deliver what meets the needs of customers, while conceding that desires change with time and the supply can quickly become "obsolete, outdated and unattractive." "They must respond in time to changing customer needs, if not, they can be lost," he adds.

Larger and stronger banks

In addition to competition in business areas such as loan and deposit lending, Santander points to the existing consolidation trend in the sector and has created "bigger and stronger" banks with which it may be forced to compete.

"It can not be guaranteed that this increase in competition will not adversely affect the group's growth prospects and therefore its operations," he says.


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