Banco Santander, S.A.

Good morning everyone and thank you for joining Santander's third quarter presentation. Today's presentation will follow the usual structure. First, Hector will talk about our results with a special focus on the performance of our global businesses. Jose will then cover the financial results in more detail, and finally Hector will close with final remarks before we open the line for Q&A. Before we start, let me highlight two points. First, this is the first quarter in which both TSP and Webster are included in our results, with Webster consolidating from August 20th. Second, to provide a clearer view of the underlying trends, our underlying metrics exclude the impact of Poland, as well as integration costs related to TSP and Webster. With that, Hector, over to you.

Thanks, Raúl, and good morning, everyone. Q3 was another strong quarter for Santander, demonstrating once again the strength of our strategy and the resilience of our business model. Our underlying profit for the first nine months of 26 hit a new record of $11.2 billion, driven by strong customer activity, revenue growth, and our growing franchise of 189 million customers, which now includes TSB and Webster. At the same time, one transformation continues to drive excellent progress towards a simpler and more integrated model. This is translating into tangible results. Efficiency improving by almost two percentage points, underlying ROTE increasing to 16%. Our balance sheet remains very solid, with robust credit quality and CET1 ratio of 12.7%. We have generated close to 90 basis points of capital this year, helping us to absorb the impacts from TSB and Webster while maintaining a solid capital position. Overall, our disciplined capital allocation continues to drive strong results and shareholder value creation. Before I move on, as you may notice, the impact of TSB and Webster on year-on-year trends remains very limited, at around 1.3 percentage points across the main P&L lines. Our P&L remains very solid, with underlying profit growing 14% year-on-year in constant euros. We continue to deliver strong revenue growth across our global businesses with revenue up 7% supported by NII up 8% driven by a profitable volume growth and record fees up 7% outpacing NII growth XM&A with the strong customer activity across our businesses. This reflects the structural trends as customers do more with us and we capture the benefits of stronger connectivity across the group. At the same time, costs declined excluding TSB and Webster, demonstrating the positive effects of our transformation. LLPs remain impacted by Argentina, reflecting sector-wide trends in the country. In the rest of the group, provisions grew broadly in line with organic portfolio growth. All in all, these results once again demonstrate the quality and resilience of our earnings. What we are seeing again this quarter clearly reflects the strategy we presented at Investor Day. Our unique business model combines scale with customer focus and diversification across Europe and the Americas. Together with one transformation and our networked businesses continues to drive operational leverage, higher profitability, and strong shareholder value creation. Now let's talk about our customers. Three structural trends continue to strengthen the quality of our results. First, we continue to grow our customer base. Second, customers are doing more with us, supported by higher engagement, better products, and stronger connectivity across the group, driving fees per active customers up 2%. And third, We continue to structurally reduce our cost to serve as one transformation continues to scale across the group. Together, more active customers, deeper relationships, and lower cost to serve are making our profitability more sustainable over time. We continue to deliver on our transformation, driving structural efficiency and Gaines from levers we control. Simplification and automation have delivered almost two percentage points of efficiencies. Our network businesses are generating strong positive jobs. Our global technology platforms are scaling across the group, and AI is now making a measurable contribution. As a result, our efficiency has improved significantly with further upside ahead. Our five global businesses continue to deliver strong results, supported by customer activity, diversification, and scale. Retail and open banks are delivering strong operational leverage through revenue growth and lower costs. CIB Wealth and Payments continue to leverage our global capabilities and connectivity to deliver double-digit revenue growth and further efficiency gains. Together, our global business model is driving higher profitability and continued progress towards our 28 targets. Now, let me take you through each global business. In retail, we continue to transform our model, combining cutting-edge technology with expertise and proximity for our teams to deliver the best customer experience. We continue to scale up our global platforms, with new app now live in five countries and the customer interaction platform available in six following its rollout in Spain. Together, they are enabling a simpler, more personalized, and more consistent customer experience across the markets. In commercial, our new model continues to generate strong results in Spain and the UK, connecting high-growth companies with more value-added solutions, delivering 17 percentage points of operating jobs in each market, with strong revenue growth and lower costs year-on-year. At the same time, Webster strengthens our commercial capabilities in the U.S., adding scale, deposits, and further cross-border opportunities across the U.S.-Latam corridor, leveraging our global footprint. Overall, retail fees grew 8 percent, cost per active customer declined 5 percent, and productivity continued to improve. Profit grew 12% year-on-year, supported by strong operational leverage and solid asset quality with cost of risk relatively stable ex-Argentina. Looking ahead, we expect profitable growth to continue as we scale our model, deepen customer relationships, and capture additional revenue and cost synergies from TSB and Webster. With OpenBank, we are building a more integrated, scalable, and efficient business with a broader customer proposition across our key markets. In mobility finance, we continue to strengthen our core auto lending business with 12 new agreements with OEMs, reinforcing our position as a strategic partner. At the same time, we are broadening our offering beyond traditional auto lending, expanding our leasing platform in Europe, and improving the digital customer experience. In digital banking, our customer proposition continues to gain traction. This is reflected in embedded finance, where open bank pay continues to scale, including the recent expansion of our Amazon partnership to Poland. At the same time, our focus on funding optimization continues to support profitability, particularly in the U.S., where our digital bank has already raised around $11 billion of deposits since its launch. This is translating into strong underlying performance, with positive operational leverage driving 13% growth in profit before tax, excluding motor finance. As anticipated, profit continues to reflect the end of the electric vehicle tax incentives in the U.S. The tax rate is now expected to remain broadly stable. We expect profitability to improve as we continue to scale the business and deliver further efficiencies. Santander U.S. is already delivering strong results, with clear improvements in profitability, efficiency, and funding. In just nine months, Santander U.S. ROTE has improved by around two percentage points, while profit is up 20 percent – 24 percent year-on-year, excluding Webster, supported by strong operating leverage and lower provisions. Open Bank has been an important contributor to this progress, particularly through the improvement in our funding profile, and with Webster now part of the group, our loan-to-deposit ratio is below 100%. Webster further accelerates this progress, adding scale, a more balanced business mix, and has significant cost synergies, and puts on a clear path to around 80% ROTE by 2028. In CIB, we continue to build a world-class business for our corporate and institutional clients, leveraging the strength of our global network. Our business model combines in-depth industry expertise, advice, financing, and risk management capabilities, helping us to build deeper strategic relationships with our clients. A good example is our role in the largest offshore wind project in the German Baltic Sea. Where we supported our client as debt and M&A advisor, lender, and hedge counterparty. What continues to differentiate us is the connectivity of our franchise, bringing CIB capabilities to clients across the group in a much more integrated way. Our recent airport financing illustrates this very well, with our export finance capabilities supporting a commercial banking client. At the same time, we continue to transform our operating model through global platforms and AI, improving productivity, customer service, and risk management. Strong client activity, efficiency, and capital discipline continue to drive profitable growth. As a result, profit rose 15% year-on-year while maintaining one of the best efficiency ratios in the sector and generating new business at an ROTE of around 22%. In wealth, we continue to deliver solid growth while enhancing our value proposition, leveraging our global scale and capabilities. In private banking, we are further strengthening our global advisory model and connectivity across countries and businesses. This is already translating into a stronger client activity with cross-border referrals of more than 40% year-on-year. In insurance and asset management, we are increasingly operating as one integrated platform to deliver a more differentiated value proposition. Insurance is one of the biggest growth opportunities across a group. Our integrated life and pensions model is already delivering tangible results in Spain, where life-saving sales increased 43% year-on-year. In protection, our specialized sales model in Brazil is driving higher productivity and conversion rates, while reducing churn through expert advice. This is supporting a 20% premium growth across our core insurance businesses. Together, These initiatives are making our business more scalable, more resilient, and increasingly fee-based. Overall, profit rose almost 20%, driven by strong client inflows, fee growth, and continued efficiency gains. Finally, payments are a high-growth platform business. We continue to combine scale with innovation. In GetNet, we remain focused on reinforcing our value proposition through innovation, including a single-entry platform that allows merchants to accept payments across Europe. GetNet Platforms is already processing around 2 billion transactions per month, helping to reduce the cost per payment transaction by 39%. And eBury, we are accelerating international expansion, product development, and innovation. This is translating into strong financial performance, with revenue up 15%, EBDA margin improving to 34%, and profit more than doubling year on year. Overall, the business keeps building strong momentum with significant upside as we continue to scale our global platforms. Our strong operational and financial performance continues to drive organic capital generation, higher profitability, and double-digit value creation. We have generated almost One percentage point of capital organically during the year, leaving our CET1 ratio of 12.7%, on track to achieve our global year-end target. Underlying growth improved to 16% and is close to 17% at a normalized average CET1 ratio of 13%. Underlying earnings per share were 21%, reflecting strong profit generations and buybacks, while TNAF plus cash dividend per share increased 11% even after the initial impact from Webster. Including the program currently underway, total share buybacks will reach around 9 billion euros, close to our commitment to distribute at least 10 billion euros for 2025 and 2026. I will now hand over to Jose, who will walk you through the financials in much more detail.

Thank you, Hector, and good morning, everyone. I will take you through the Group's P&L and capital performance in more detail. Let me start with two brief comments. First, the Group's P&L includes 40 days of Webster results following its acquisition in August and, obviously, a complete TSB quarter. I will only refer to the impact of TSB and Webster where material. Second, as usual, we present growth rates in both current and constant euros. The difference this period was around two percentage points, mainly due to the appreciation of the Brazilian real and the Mexican peso. Turning to the results, as Hector said, we are delivering record results once again, supported by good commercial activity and structural cost efficiencies, generating strong operational leverage. Revenue grew 7%, while costs were stable, even with the consolidation of TSB and Webster. Loan loss provisions were again this quarter affected by Argentina, reflecting sector-wide trends in the country. Excluding Argentina, provisions grew in line with the loan portfolio. The other results line includes motor finance provisions in Open Bank Europe booked in the first half, as well as restructuring costs related to the execution of our transformation. As a result, profit grew 14% year-on-year in constant euros, putting us in a very strong position to exceed our guidance of more than 14.1 billion profit in 2026, excluding M&A. Total revenue increased 7% year-on-year supported by deeper client relationships, higher engagement, and 17 million new customers over the last 12 months. All five global businesses contributed to revenue growth. In retail, stronger customer engagement drove solid growth in both NII and fees. Open Bank reported solid NII performance, particularly in Europe and South America. CIB was up 14%, supported by strong client activity across business lines. And wealth and payments delivered double-digit growth, driven by fee-generating activity, client flows in wealth, and higher volumes in payments. Excluding M&A, revenue grew 5%, keeping us on track to deliver our mid-single-digit growth target. Overall, these results demonstrate the strength and diversification of our revenue base. The group's net interest income increased 8% year-on-year, supported by the contribution from TSB and Webster in retail and open bank. Excluding their impact, NII rose 5%. Retail delivered a positive performance across most countries, supported by higher volumes and active balance sheet management. Open bank also performed well, driven by volumes and disciplined margin management, particularly in Europe, together with a contribution from our broader presence in South America. CIB also contributed significantly, led by capital-efficient high-return activities, particularly in global markets. On a quarter-on-quarter basis, net interest income rose 2% on the back of strong trends in retail Spain and the UK, as well as the inclusion of Webster. In Spain, retail continued to perform strongly with NII up 2% quarter-on-quarter, supported by improved loan pricing and active balance sheet management. The UK also delivered a strong quarter with NII up 6% quarter-on-quarter, excluding TSB, supported by higher yields and volumes. However, the quarter was affected by the normalization of CIB after a strong quarter, the shift towards a lower risk portfolio mix and day count differences between loans and deposits in Brazil, and lower UF in Chile. Just these last two effects explain the drop at group level. Overall, NIA is proving stronger than anticipated at Investor Day. A solid activity and a more favorable rate environment in Europe, more than upset higher rates in Brazil. Net fee income increased 7% year-on-year, supported by customer growth, higher activity, and a greater contribution from value-added products, as one transformation deepens customer relationships. This is visible across the group. In retail, fees rose 8%, with strong performances across most of our footprint. Open bank fees were broadly stable, as solid growth in South America was offset by the U.S., where the comparison was affected by high servicing fees in 2025 related to portfolio sales. CIB delivered a particularly strong fee performance, driven by global banking activity, especially in the U.S., where fees grew more than 30%. Wealth continued to deliver double-digit fee growth, with a strong contribution from private banking. And payments also performed strongly, with fees up 6%, with GetNet total payment volumes increasing 9%. One transformation remains a key driver of our profitability improvement, enabling us to invest at scale in best-in-class global platforms. These platforms give us the capabilities and customer experience needed to compete with leading digital players, attract more customers, deepen relationships, and support growth. At the same time, our global approach reduces duplication and structural costs across markets. This is reflected in our efficiency ratio, which now stands at 42.6%, the best level in 17 years, with both revenue and costs improving at the same time. In retail, an open bank, which represents roughly 75% of our cost base, cost declined by 2% even after incorporating TSB and Webster, and while we continue to invest in our global platforms, and revenues grew 6% with strong, positive operating jobs. In our network businesses, CIB, wealth and payments, costs grew well below revenue, Reflecting targeted investments in capabilities that support capital-light growth and recurrence. As a result, net operating income was up 12%, increasing from already high levels last year. Looking ahead, we see further room for cost improvement despite inflationary pressures, without taking into account the synergies from TSB and Webster, all of them levers that are firmly within our control. Our balance sheet's risk profile remains low, with sound credit quality across the group, supported by prudent risk management and resilient labor markets in most of our core geographies. As in previous quarters, metrics are impacted by Argentina, reflecting sector-wide trends in the country. However, cost of risk in Argentina improved again this quarter. Following the stabilization trend we anticipated earlier this year, slower new production begins to feed through. Excluding Argentina, the group's underlying credit quality remains solid. Loan loss provisions grew in line with organic loan growth, while cost of risk was broadly stable at 109% even after absorbing less favorable FX movements. Retail and open bank represent over 90% of the group's loan loss provisions. In retail, cost of risk was stable year on year, excluding Argentina, supported by key markets such as Spain and Brazil. In open bank Europe, cost of risk reflected model updates and growth in open bank pay, while in the U.S., continued to perform well. In CIB, provisions were affected by a limited number of single names. Our NPL ratio remains low, as the negative impact from Argentina was broadly offset by the positive contributions from TSB and Webster. Overall, credit quality remains resilient. As long as labor markets do not deteriorate, we would not expect material impacts on credit quality. Moving on to capital, we reported another good quarter of organic capital generation. Our CT1 ratio stood at 12.7% after absorbing the 147 basis point impact from Webster. Excluding this impact, the CT1 ratio increased around 15 basis points in the quarter, demonstrating our ability to generate capital while investing in profitable growth. This quarter we generated 59 basis points of capital from profit, which enabled us to build capital while growing new businesses at a return on tangible equity of around 21%, compensating capital distribution charges for shareholder remuneration in line with our payout target, and absorbing other impacts, including regulatory charges in line with our expectations. This solid organic capital generation keeps us on track to end the year at or above our 12.8 target at the upper end of our 12 to 13% CT1 operating range after absorbing the remaining regulatory charges and integration impacts from TSB and Webster in the fourth quarter. Hector, back to you.