Spanish bank Santander has earmarked $250 million to grow its corporate and investment bank over the next two years, as other major banks have simultaneously pulled away amid a sector-wide dealmaking slump.
The Financial Times reported that Santander has hired more than 100 bankers this year, mostly in the U.S. and more than half from Credit Suisse. This aligns with earlier Reuters reports from July that Santander was bulking up its investment bank with a focus on hiring managing directors.
“The chance to accelerate growth in the US was a logical opportunity for us,” said Santander Executive Chair Ana Botín, according to the FT. “What we want is people who fit our culture.”
Santander CEO Héctor Grisi previously spent 18 years at Credit Suisse. Many bankers brought over from the collapsed Swiss lender were on his recommendation, the FT reported.
Santander’s corporate and investment bank has more than doubled in headcount over the past seven years, from 3,500 to 8,000 staffers. Some of the boost has been from internal reorganizations.
“The business we run is very different from other investment banks,” Botín told the FT. “It’s mostly a corporate bank and we are now adding the fee business, focusing on areas where we are strong like renewables and infrastructure.”
“We already provide financing, but if we want to deepen client relationships, we need to give them access to dollar markets, strategic advice, access to capital markets and structured transactions,” she said.
Santander’s planned investment bank growth stands in juxtaposition with other large banks.
Goldman Sachs, JPMorgan Chase and TD’s Cowen made cuts this summer to their investment banking businesses, as did BMO Capital Markets in Canada.
Other banks, including PNC and Ally Financial, have recently made broader job cuts in cost-cutting measures, according to Bloomberg.
In September, Santander announced a retooling that consolidated its retail and commercial business into a new global unit and created a global digital consumer banking division.
Both moves are meant to position the bank closer to the goals it outlined at an investor day in February, including adding 40 million customers, increasing its return on tangible equity to 15%-17%, and achieving double-digit annual growth in tangible net asset value per share plus dividend per share, all by 2025.
