By Elena Vardon

Banco Santander is scheduled to report results for the first quarter of 2025 on Wednesday. Here is what you need to know.

NET PROFIT FORECAST: The Spanish lender is expected to report a net profit of 3.43 billion euros ($3.92 billion) for the three months ended March 31, according to a Visible Alpha poll based on 13 analysts' estimates. Santander posted a net profit of 2.85 billion euros for the same period last year.

INCOME FORECAST: The bank's revenue is expected to come in at 15.445 billion euros for the quarter by the same consensus, up from last year's 15.045 billion euros. Net interest income--the difference between what banks earn on loans and what they pay clients for deposits--is expected to contribute 11.51 billion euros to the total result.

The increase is expected to be driven by growth in Spain on the lesser impact of bank levies and lower credit provisions and in South America on lighter costs, though some of this should be offset by a decline in its U.S. and Mexico operations due to lower interest rates.

Shares in Madrid have risen 45% since the start of the year and trade at around 6.5 euros.

WHAT TO WATCH

-- The market expects few surprises and a generally solid quarter, according to analysts. Given the bank's European and Latin American exposure, the market will focus on the management's assessment of the impact of sweeping U.S. tariffs on the business and measures to mitigate them.

-- "The spotlight will also be on strategic initiatives, potential exits and the bank's ability to deliver on its capital return plans," Barclays analysts wrote in a research note.

Analysts will likely have questions on Santander's plans to divest its stake in its Polish operations after it said it received several expressions of interest for the business and confirmed talks with Austria's Erste Group Bank. The group has also reportedly been looking for options for its U.K. business though Santander has reiterated that the U.K. is a core market.

-- Spain's bank levy is now expected to be booked on a quarterly basis instead of as an upfront lump sum at the start of the year. This could--like in the case of peer BBVA, which reported results on Tuesday--flatter Santander's bottomline and on-year comparison.

-- Consensus pencils in a common equity tier 1 ratio--a key measure of balance sheet strength--of 13.60% at the end of the period, compared with 12.78% three months prior.

Write to Elena Vardon at elena.vardon@wsj.com

(END) Dow Jones Newswires

April 29, 2025 07:11 ET (11:11 GMT)

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