Spanish banking giant Banco Santander (DE:BSD2) has raised shareholder rewards to €5.5 billion by increasing the dividends and share repurchase plan to boost investor confidence. Banco Santander said it will pay a final cash dividend of 9.50 cents per share on May 2. Furthermore, the bank announced a €1.5 billion share buyback plan effective February 20, 2024. The raise reflects a combined yield of 10%. BSD2 shares rose over 3% on the news on Monday.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
Enhanced Returns
With the new dividend, the bank’s total dividend for Fiscal 2023 increased by 50% to reach 17.60 cents per share compared to the prior year. The combined shareholder rewards reflect a rise in the bank’s total payout to 50% of attributable profits from 40% in Fiscal 2022.
The announcement comes as Europe’s largest banker recently reported a massive jump in its Fiscal 2023 profits on the heels of high interest rates. The bank’s executive chair, Ana Botin, said that the bank was already witnessing solid performance in 2024 and hopes to meet all its targets, including a return on tangible equity of 16%. Last week, reports also suggested that Santander was increasing the bonuses for its investment bankers by an average of 10%, thanks to the strong performance in Fiscal 2023.
Are Santander Shares a Good Buy?
With three Buys versus seven Hold recommendations, BSD2 stock has a Moderate Buy consensus rating on TipRanks. The Banco Santander SA share price target of €4.81 implies 26.9% upside potential from current levels.
