appendix - santanderannualreport.com · 214 appendix auditors’ report and nnu l consolid ted...

Appendix

214

Appendix

Auditors’ report And AnnuAl consolidAted Accounts 2016

» Appendix i

Subsidiaries of Banco Santander, S.A.1

% of ownership held by the bank % of voting powerk Millions of eurosa

Company Location Direct Indirect 2016 2015Line of business

Capital and Reserves

Net profit (loss) for the year

Carrying amount

2 & 3 Triton Limited (d) United Kingdom

0.00% 100.00% 100.00% 100.00% Property 44 5 12

Abbey Covered Bonds LLP United Kingdom

- (b) - - Securitisation -389 -19 0

Abbey National International Limited

Jersey 0.00% 100.00% 100.00% 100.00% Banking 16 0 0

Abbey National Property Investments

United Kingdom

0.00% 100.00% 100.00% 100.00% Finance 521 26 162

Abbey National Treasury Services Overseas Holdings

United Kingdom

0.00% 100.00% 100.00% 100.00% Holding Company

409 18 418

Abbey National Treasury Services plc

United Kingdom

0.00% 100.00% 100.00% 100.00% Banking 4,177 213 3,328

Alliance & Leicester Commercial Bank plc

United Kingdom

0.00% 100.00% 100.00% 100.00% Finance 26 0 26

Alliance & Leicester Personal Finance Limited

United Kingdom

0.00% 100.00% 100.00% 100.00% Finance -237 -1 0

Altamira Santander Real Estate, S.A.

Spain 100.00% 0.00% 100.00% 100.00% Property 521 -296 121

Atlantes SME No. 4 Portugal - (b) - - Securitisation 82 1 0

Atlantes SME No. 5 Portugal - (b) - - Securitisation 88 -3 0

Atlantys Espacios Comerciales, S.L.

Spain 0.00% 70.27% 100.00% 100.00% Property 25 0 24

Aviación Antares, A.I.E. Spain 99.99% 0.01% 100.00% 100.00% Renting 36 5 28

Aviación Centaurus, A.I.E. Spain 99.99% 0.01% 100.00% 100.00% Renting 33 2 25

Aviación Intercontinental, A.I.E. Spain 65.00% 0.00% 65.00% 65.00% Renting 76 4 35

Aviación Regional Cántabra, A.I.E.

Spain 73.58% 0.00% 73.58% 73.58% Renting 19 10 12

Aviación Scorpius, A.I.E. Spain 99.99% 0.01% 100.00% 100.00% Renting 36 3 26

Aviación Tritón, A.I.E. Spain 99.99% 0.01% 100.00% 100.00% Renting 21 2 19

Aymoré Crédito, Financiamento e Investimento S.A.

Brazil 0.00% 89.38% 100.00% 100.00% Finance 414 15 356

Banca PSA Italia S.p.a. Italy 0.00% 50.00% 50.00% 50.00% Banking 193 26 96

Banco Bandepe S.A. Brazil 0.00% 89.38% 100.00% 100.00% Banking 859 76 804

Banco de Albacete, S.A. Spain 100.00% 0.00% 100.00% 100.00% Banking 15 0 9

Banco de Asunción, S.A. en liquidación voluntaria (j)

Paraguay 0.00% 99.33% 99.33% 99.33% Banking 0 0 0

Banco Madesant - Sociedade Unipessoal, S.A.

Portugal 0.00% 100.00% 100.00% 100.00% Banking 1,097 2 1,101

Banco Olé Bonsucesso Consignado S.A.

Brazil 0.00% 53.63% 60.00% 60.00% Banking 193 4 122

Banco PSA Finance Brasil S.A. Brazil 0.00% 44.69% 50.00% - Finance 76 3 36

Banco Santander - Chile Chile 0.00% 67.12% 67.18% 67.18% Banking 3,587 668 3,237

Annexes I, II and III included in this Report differ from the ones included in the formulated consolidated annual accounts since the former ones contain information about the most significant companies that form the Group, whereas the Annexes in the consolidated annual accounts, available for all the shareholders from the calling date of the Ordinary General Shareholders Meeting, where they will be subject to their approval, include the inventory of all the Group companies.

The selection criteria consists of including all companies whose activity is Banking or Insurance, as well as those whose local equity is greater than 20 million Euros in absolute value, excluding holding companies that do not consolidate or do not have significant transactions with third parties.

215Auditors’ report And AnnuAl consolidAted Accounts 2016






Carrying amount

Banco Santander (Brasil) S.A. Brazil 13.86% 75.52% 90.00% 89.86% Banking 16,348 1,610 10,197

Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México

Mexico 0.00% 75.05% 99.99% 99.99% Banking 4,200 723 3,695

Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México como Fiduciaria del Fideicomiso 100740

Mexico 0.00% 75.05% 100.00% 100.00% Finance 163 16 134

Banco Santander (Panamá), S.A. Panamá 0.00% 100.00% 100.00% 100.00% Banking 51 6 51

Banco Santander (Suisse) SA Suisse 0.00% 100.00% 100.00% 100.00% Banking 573 27 325

Banco Santander Bahamas International Limited

Bahamas 0.00% 100.00% 100.00% 100.00% Banking 522 10 532

Banco Santander Consumer Portugal, S.A.

Portugal 0.00% 100.00% 100.00% 100.00% Banking 137 26 128

Banco Santander de Negocios Colombia S.A.

Colombia 0.00% 100.00% 100.00% 99.99% Finance 74 -1 72

Banco Santander International USA 0.00% 100.00% 100.00% 100.00% Banking 878 58 935

Banco Santander Perú S.A. Peru 99.00% 1.00% 100.00% 100.00% Banking 153 19 121

Banco Santander Puerto Rico Puerto Rico 0.00% 100.00% 100.00% 100.00% Banking 829 24 853

Banco Santander Río S.A. Argentina 0.00% 99.30% 99.20% 98.44% Banking 968 310 421

Banco Santander Totta, S.A. Portugal 0.00% 99.85% 99.95% 99.94% Banking 2,483 351 3,415

Banco Santander, S.A. Uruguay 97.75% 2.25% 100.00% 100.00% Banking 367 15 191

Banif International Bank, Ltd Bahamas 0.00% 99.85% 100.00% 100.00% Banking 1 -4 2

Bank Zachodni WBK S.A. Poland 69.41% 0.00% 69.41% 69.41% Banking 3,843 472 4,171

BRS Investments S.A. Argentina 0.00% 100.00% 100.00% 100.00% Finance 37 10 73

BZ WBK Finanse Sp. z o.o. Poland 0.00% 69.41% 100.00% 100.00% Financial services

42 5 20

BZ WBK Leasing S.A. Poland 0.00% 69.41% 100.00% 100.00% Leasing 105 4 23

BZ WBK Towarzystwo Funduszy Inwestycyjnych S.A.

Poland 50.00% 34.71% 100.00% 100.00% Fund management company

10 11 39

Carfax (Guernsey) Limited (i) Guernsey 0.00% 100.00% 100.00% 100.00% Insurance brokerage

24 0 23

Carfinco Inc. Canada 0.00% 96.42% 100.00% 100.00% Finance 39 4 189

Cartera Mobiliaria, S.A., SICAV Spain 0.00% 82.46% 85.29% 95.46% Securities investment

733 1 468

Casa de Bolsa Santander, S.A. de C.V., Grupo Financiero Santander México

Mexico 0.00% 75.03% 99.97% 99.97% Brokerage 46 1 35

Cater Allen Limited United Kingdom

0.00% 100.00% 100.00% 100.00% Banking 351 77 260

CCAP Auto Lease Ltd. USA 0.00% 58.79% 100.00% 100.00% Leasing 630 631 0

Central Eólica Coqueirinho S.A. Brazil 0.00% 77.59% 100.00% 100.00% Electricity production

25 -2 19

Central Eólica Corrupião S.A. Brazil 0.00% 77.59% 100.00% 100.00% Electricity production

23 -1 18

Central Eólica Inhambu S.A. Brazil 0.00% 77.59% 100.00% 100.00% Electricity production

29 -2 22

Central Eólica Tamanduá Mirim S.A.

Brazil 0.00% 77.59% 100.00% 100.00% Electricity production

27 -2 20

Certidesa, S.L. Spain 0.00% 100.00% 100.00% 100.00% Airplane renting

-44 -6 0

216

Appendix







Carrying amount

Chrysler Capital Auto Funding II LLC

USA 0.00% 58.79% 100.00% - Finance 0 -27 0

Chrysler Capital Master Auto Receivables Funding 2 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance -47 -122 0

Chrysler Capital Master Auto Receivables Funding LLC

USA 0.00% 58.79% 100.00% 100.00% Finance -134 24 0

Compagnie Generale de Credit Aux Particuliers - Credipar S.A.

France 0.00% 50.00% 100.00% 100.00% Banking 363 185 428

Compagnie Pour la Location de Vehicules - CLV

France 0.00% 50.00% 100.00% 100.00% Finance 33 7 22

Drive Auto Receivables Trust 2015-C

USA - (b) - - Securitisation -25 -2 0

Drive Auto Receivables Trust 2015-D

USA - (b) - - Securitisation -53 15 0

Drive Auto Receivables Trust 2016-A

USA - (b) - - Securitisation 0 -47 0

Drive Auto Receivables Trust 2016-B


Drive Auto Receivables Trust 2016-C


Evidence Previdência S.A. Brazil 0.00% 89.38% 100.00% 100.00% Holding Company

64 9 73

Financiera El Corte Inglés, E.F.C., S.A.

Spain 0.00% 51.00% 51.00% 51.00% Finance 214 66 140

Fuencarral Agrupanorte, S.L. Unipersonal

Spain 0.00% 70.27% 100.00% 100.00% Property 92 8 101

Fundo de Investimento Imobiliário-FII

Brazil 0.00% 89.38% 100.00% - Investment fund

172 -1 153

Geoban, S.A. Spain 100.00% 0.00% 100.00% 100.00% Services 24 4 24

Gestora Patrimonial Calle Francisco Sancha 12, S.L.

Spain 68.80% 0.00% 68.80% 68.80% Securities and real estate management

12 85 8

Getnet Adquirência e Serviços para Meios de Pagamento S.A.

Brazil 0.00% 79.10% 88.50% 88.50% Payment services

350 78 339

Hipototta No. 4 FTC Portugal - (b) - - Securitisation 37 10 0

Hipototta No. 5 FTC Portugal - (b) - - Securitisation 28 9 0

Hune Rental, S.L. (c) Spain 64.44% 0.00% 64.44% - Machinery rent

-230 -6 30

Ingeniería de Software Bancario, S.L.

Spain 100.00% 0.00% 100.00% 100.00% It services 187 10 145

Inmo Francia 2, S.A. Spain 100.00% 0.00% 100.00% 100.00% Property 54 0 54

Inversiones Capital Global, S.A. Unipersonal

Spain 100.00% 0.00% 100.00% 100.00% Holding Company

536 -18 494

Isban Chile S.A. Chile 0.00% 100.00% 100.00% 100.00% It services 21 1 20

Isban México, S.A. de C.V. Mexico 0.00% 100.00% 100.00% 100.00% It services 55 3 61

Laparanza, S.A. Spain 61.59% 0.00% 61.59% 61.59% Agricultural holding

28 0 16

Luri 6, S.A. Spain 100.00% 0.00% 100.00% 100.00% Real estate investment

1,148 87 1,444

Merlion Aviation One Limited Ireland 51.00% 0.00% 51.00% 51.00% Renting 39 0 0

Metrovacesa Inmuebles y Promociones, S.L.

Spain 0.00% 70.27% 100.00% 100.00% Property 32 0 32

Metrovacesa Promoción y Arrendamiento, S.A.

Spain 52.50% 17.77% 70.27% - Real state development

317 -18 229

Metrovacesa Suelo y Promoción, S.A.

Spain 52.50% 17.77% 70.27% - Real state development

1,033 -14 804

Naviera Trans Iron, S.L. Spain 100.00% 0.00% 100.00% 100.00% Leasing 22 1 21







Carrying amount

Naviera Trans Wind, S.L. Spain 99.99% 0.01% 100.00% 100.00% Renting 37 2 43

Norbest AS Norway 7.94% 92.06% 100.00% 100.00% Securities investment

95 -1 94

Novimovest – Fundo de Investimento Imobiliário

Portugal 0.00% 78.96% 79.08% 78.59% Investment fund

323 8 254

Open Bank, S.A. Spain 100.00% 0.00% 100.00% 100.00% Banking 222 9 237

Optimal Investment Services SA Suisse 100.00% 0.00% 100.00% 100.00% Fund management company

26 -1 29

Optimal Multiadvisors Ltd / Optimal Strategic US Equity Series (consolidado) (c)

Bahamas 0.00% 55.62% 56.10% 56.10% Fund management company

49 0 0

PBE Companies, LLC USA 0.00% 100.00% 100.00% 100.00% Property 118 2 106

Produban Servicios Informáticos Generales, S.L.

Spain 99.96% 0.04% 100.00% 100.00% Services 196 9 202

Promociones Vallebramen, S.L. Spain 0.00% 70.27% 100.00% 100.00% Property -29 3 0

PSA Bank Deutschland GmbH Germany 0.00% 50.00% 50.00% 50.00% Banking 400 33 199

PSA Banque France France 0.00% 50.00% 50.00% 50.00% Banking 790 282 463

PSA Finance Arrendamento Mercantil S.A.

Brazil 0.00% 89.37% 100.00% - Leasing 103 6 74

PSA Finance Belux S.A. Belgium 0.00% 50.00% 50.00% - Finance 84 15 41

PSA Finance Polska Sp. z o.o. Poland 0.00% 40.82% 50.00% - Finance 33 1 11

PSA Finance Suisse, S.A. Suisse 0.00% 50.00% 100.00% 100.00% Leasing 24 3 15

PSA Finance UK Limited United Kingdom

0.00% 50.00% 50.00% 50.00% Finance 297 70 127

PSA Financial Services Nederland B.V.

Holland 0.00% 50.00% 50.00% - Finance 52 9 22

PSA Financial Services Spain, E.F.C., S.A.

Spain 0.00% 50.00% 50.00% 50.00% Finance 357 34 174

Punta Lima, LLC USA 0.00% 100.00% 100.00% 100.00% Leasing 31 -1 36

Retop S.A. (f) Uruguay 100.00% 0.00% 100.00% 100.00% Finance 13 15 63

Riobank International (Uruguay) SAIFE (j)

Uruguay 0.00% 100.00% 100.00% 100.00% Banking 0 0 0

Santander Agente de Valores Limitada

Chile 0.00% 67.43% 100.00% 100.00% Brokerage 55 17 48

Santander Ahorro Inmobiliario 1, S.I.I., S.A.

Spain 59.75% 9.45% 73.41% 40.02% Real estate investment

37 -2 28

Santander Ahorro Inmobiliario 2, S.I.I., S.A.

Spain 87.12% 7.68% 95.22% 85.51% Real estate investment

31 -5 26

Santander Asset Finance (December) Limited

United Kingdom

0.00% 100.00% 100.00% 100.00% Leasing 46 6 0

Santander Asset Finance plc United Kingdom

0.00% 100.00% 100.00% 100.00% Leasing 204 2 169

Santander Asset Management - Sociedade Gestora de Fundos de Investimento Mobiliário, S.A.

Portugal 100.00% 0.00% 100.00% 100.00% Fund management company

27 0 26

Santander BanCorp Puerto Rico 0.00% 100.00% 100.00% 100.00% Holding Company

970 23 993

Santander Bank & Trust Ltd. Bahamas 0.00% 100.00% 100.00% 100.00% Banking 794 -2 403

Santander Bank, National Association

USA 0.00% 100.00% 100.00% 100.00% Banking 12,585 144 12,730

Santander Benelux, S.A./N.V. Belgium 0.00% 100.00% 100.00% 100.00% Banking 1,164 22 1,170

Santander Brasil Administradora de Consórcio Ltda.

Brazil 0.00% 89.38% 100.00% 100.00% Services 31 9 36

Santander Brasil, EFC, S.A. Spain 0.00% 89.38% 100.00% 100.00% Finance 775 -15 665

Santander Capitalização S.A. Brazil 0.00% 89.38% 100.00% 100.00% Insurance 58 32 80

218

Appendix







Carrying amount

Santander Cards Limited United Kingdom

0.00% 100.00% 100.00% 100.00% Cards 108 0 108

Santander Cards UK Limited United Kingdom

0.00% 100.00% 100.00% 100.00% Finance 167 1 125

Santander Consumer (UK) plc United Kingdom

0.00% 100.00% 100.00% 100.00% Finance 562 103 304

Santander Consumer ABS Funding 3 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance -3 -26 0

Santander Consumer Auto Receivables Funding 2011-A LLC

USA 0.00% 58.79% 100.00% 100.00% Finance 250 45 0

Santander Consumer Auto Receivables Funding 2013-L1 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance -135 -61 0

Santander Consumer Auto Receivables Funding 2014-B1 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance 29 28 0


USA 0.00% 58.79% 100.00% 100.00% Finance 12 13 0


USA 0.00% 58.79% 100.00% 100.00% Finance 6 21 0


USA 0.00% 58.79% 100.00% 100.00% Finance 15 26 0


USA 0.00% 58.79% 100.00% 100.00% Finance -45 -4 0


USA 0.00% 58.79% 100.00% 100.00% Finance -16 -25 0


USA 0.00% 58.79% 100.00% 100.00% Finance -12 -26 0


USA 0.00% 58.79% 100.00% 100.00% Finance 0 -28 0


USA 0.00% 58.79% 100.00% 100.00% Finance 0 -40 0


USA 0.00% 58.79% 100.00% 100.00% Finance 0 -44 0


USA 0.00% 58.79% 100.00% - Finance 0 -41 0


USA 0.00% 58.79% 100.00% 100.00% Finance 0 -25 0


USA 0.00% 58.79% 100.00% - Finance 0 -20 0

Santander Consumer Bank AG Germany 0.00% 100.00% 100.00% 100.00% Banking 3,063 530 4,820

Santander Consumer Bank AS Norway 0.00% 100.00% 100.00% 100.00% Finance 1,507 268 1,814

Santander Consumer Bank GmbH

Austria 0.00% 100.00% 100.00% 100.00% Banking 326 33 363

Santander Consumer Bank S.A. Poland 0.00% 81.65% 100.00% 100.00% Banking 511 102 507

Santander Consumer Bank S.p.A. Italy 0.00% 100.00% 100.00% 100.00% Banking 613 67 603

Santander Consumer Banque S.A.

France 0.00% 100.00% 100.00% 100.00% Banking 432 57 490

Santander Consumer Captive Auto Funding LLC

USA 0.00% 58.79% 100.00% 100.00% Finance -18 -10 0

Santander Consumer Chile S.A. Chile 51.00% 0.00% 51.00% 51.00% Finance 56 12 17

Santander Consumer Credit Services Limited

United Kingdom

0.00% 100.00% 100.00% 100.00% Finance -36 0 0

Santander Consumer Finance Benelux B.V.

Holland 0.00% 100.00% 100.00% 100.00% Finance 98 22 190

Santander Consumer Finance Oy Finland 0.00% 100.00% 100.00% 100.00% Finance 143 44 130

Santander Consumer Finance, S.A.

Spain 63.19% 36.81% 100.00% 100.00% Banking 9,238 621 7,377







Carrying amount

Santander Consumer Funding 3 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance 205 -20 0

Santander Consumer International Puerto Rico LLC

Puerto Rico 0.00% 58.79% 100.00% 100.00% Services 5 199 5

Santander Consumer Leasing GmbH

Germany 0.00% 100.00% 100.00% 100.00% Leasing 20 46 101

Santander Consumer Receivables 10 LLC

USA 0.00% 58.79% 100.00% 100.00% Finance 484 156 0


USA 0.00% 58.79% 100.00% 100.00% Finance 85 83 0


USA 0.00% 58.79% 100.00% 100.00% Finance 154 81 0


USA 0.00% 58.79% 100.00% 100.00% Finance 125 140 0


USA 0.00% 58.79% 100.00% 100.00% Finance 186 26 0

Santander Consumer Renting, S.L.

Spain 0.00% 100.00% 100.00% 100.00% Leasing 32 5 39

Santander Consumer USA Holdings Inc.

USA 0.00% 58.79% 58.79% 58.94% Holding Company

4,243 727 3,561

Santander Consumer USA Inc. USA 0.00% 58.79% 100.00% 100.00% Finance 3,096 -389 2,631

Santander Consumer, EFC, S.A. Spain 0.00% 100.00% 100.00% 100.00% Finance 413 102 505

Santander Consumo, S.A. de C.V., SOFOM, E.R., Grupo Financiero Santander México

Mexico 0.00% 75.05% 100.00% 100.00% Cards 559 130 517

Santander Corredora de Seguros Limitada

Chile 0.00% 67.20% 100.00% 100.00% Insurance brokerage

88 4 62

Santander Corredores de Bolsa Limitada

Chile 0.00% 83.23% 100.00% 100.00% Brokerage 54 3 48

Santander Corretora de Câmbio e Valores Mobiliários S.A.

Brazil 0.00% 89.38% 100.00% 100.00% Brokerage 142 31 145

Santander Drive Auto Receivables Trust 2012-5

USA - (b) - - Securitisation 140 13 0













Santander Drive Auto Receivables Trust 2013-A














220

Appendix







Carrying amount









Santander Equity Investments Limited

United Kingdom

0.00% 100.00% 100.00% 100.00% Finance 39 8 49

Santander Factoring S.A. Chile 0.00% 99.83% 100.00% 100.00% Factoring 46 2 48

Santander Factoring y Confirming, S.A., E.F.C.

Spain 100.00% 0.00% 100.00% 100.00% Factoring 467 53 126

Santander FI Hedge Strategies Ireland 0.00% 89.38% 100.00% 100.00% Investment company

146 21 150

Santander Financial Exchanges Limited

United Kingdom

100.00% 0.00% 100.00% 100.00% Finance 778 5 311

Santander Financial Services, Inc. Puerto Rico 100.00% 0.00% 100.00% 100.00% Finance 313 18 319

Santander Fintech Limited United Kingdom

100.00% 0.00% 100.00% 100.00% Securitisation 69 -3 59

Santander Fundo de Investimento Amazonas Multimercado Crédito Privado Investimento no Exterior (l)

Brazil 0.00% 89.38% 100.00% 100.00% Investment fund

141 14 139

Santander Fundo de Investimento Diamantina Multimercado Crédito Privado Investimento no Exterior (g)


130 6 122

Santander Fundo de Investimento em Cotas de Fundos de Investimento Contract i Referenciado DI (f)


126 3 121

Santander Fundo de Investimento Financial Curto Prazo (e)


2,686 183 2,563

Santander Fundo de Investimento Guarujá Multimercado Crédito Privado Investimento no Exterior


78 10 79

Santander Fundo de Investimento Renda Fixa Capitalization (e)


203 13 193

Santander Fundo de Investimento Unix Multimercado Crédito Privado (l)


86 11 87

Santander Global Facilities, S.A. de C.V.

Mexico 100.00% 0.00% 100.00% 100.00% Real estate management

95 1 136

Santander Global Facilities, S.L. Spain 100.00% 0.00% 100.00% 100.00% Property 686 3 614

Santander Global Property, S.L. Spain 97.34% 2.66% 100.00% 100.00% Securities investment

254 28 255

Santander Global Sport, S.A. Spain 100.00% 0.00% 100.00% 100.00% Sport activity 31 -2 29

Santander Hipotecario, S.A. de C.V., SOFOM, E.R., Grupo Financiero Santander México

Mexico 0.00% 75.05% 100.00% 100.00% Finance 267 31 223

Santander Holding Vivienda, S.A. de C.V.

Mexico 0.00% 75.05% 100.00% 100.00% Services 27 3 22

Santander Holdings USA, Inc. USA 100.00% 0.00% 100.00% 100.00% Holding Company

18,266 344 11,248

Santander Insurance Agency, U.S., LLC

USA 0.00% 100.00% 100.00% 100.00% Insurance 1 0 1







Carrying amount

Santander Insurance Services UK Limited

United Kingdom

100.00% 0.00% 100.00% 100.00% Asset management

40 1 47

Santander Investment Bank Limited

Bahamas 0.00% 100.00% 100.00% 100.00% Banking 967 -9 899

Santander Investment Bolsa, Sociedad de Valores, S.A. Unipersonal

Spain 0.00% 100.00% 100.00% 100.00% Brokerage 189 3 140

Santander Investment Chile Limitada

Chile 0.00% 100.00% 100.00% 100.00% Finance 567 25 321

Santander Investment Securities Inc.

USA 0.00% 100.00% 100.00% 100.00% Brokerage 155 67 223

Santander Investment, S.A. Spain 100.00% 0.00% 100.00% 100.00% Banking 176 10 191

Santander Lease, S.A., E.F.C. Spain 70.00% 30.00% 100.00% 100.00% Leasing 72 7 35

Santander Leasing S.A. Arrendamento Mercantil

Brazil 0.00% 89.37% 99.99% 99.99% Leasing 1,627 154 1,485

Santander Lending Limited United Kingdom

0.00% 100.00% 100.00% 100.00% Mortgages 210 11 221

Santander Participações S.A. Brazil 0.00% 89.38% 100.00% 100.00% Holding Company

404 46 363

Santander Private Banking Gestión, S.A., S.G.I.I.C.

Spain 100.00% 0.00% 100.00% 100.00% Fund management company

36 7 35

Santander Private Banking s.p.a. Italy 100.00% 0.00% 100.00% 100.00% Banking 45 -4 41

Santander Private Banking UK Limited

United Kingdom

0.00% 100.00% 100.00% 100.00% Property 297 1 406

Santander Real Estate, S.G.I.I.C., S.A.


119 0 118

Santander S.A. - Serviços Técnicos, Administrativos e de Corretagem de Seguros

Brazil 0.00% 93.56% 100.00% 100.00% Insurance brokerage

178 58 201

Santander Securities LLC Puerto Rico 0.00% 100.00% 100.00% 100.00% Brokerage 66 -43 29

Santander Securities Services Brasil Distribuidora de Títulos e Valores Mobiliários S.A.

Brazil 0.00% 100.00% 100.00% 100.00% Brokerage 250 20 256

Santander Securities Services, S.A. Unipersonal

Spain 0.00% 100.00% 100.00% 100.00% Banking 427 34 372

Santander Seguros y Reaseguros, Compañía Aseguradora, S.A.

Spain 100.00% 0.00% 100.00% 100.00% Insurance 970 126 1,188

Santander Totta Seguros, Companhia de Seguros de Vida, S.A.

Portugal 0.00% 99.90% 100.00% 100.00% Insurance 151 12 47

Santander UK Group Holdings plc

United Kingdom

77.67% 22.33% 100.00% 100.00% Finance 14,177 793 20,416

Santander UK Investments United Kingdom

100.00% 0.00% 100.00% 100.00% Finance 51 0 47

Santander UK plc United Kingdom

0.00% 100.00% 100.00% 100.00% Banking 15,040 1,367 14,971

Santander Vivienda, S.A. de C.V. SOFOM, E.R. Grupo Financiero Santander México

Mexico 0.00% 75.05% 100.00% 100.00% Finance 86 -2 63

Santusa Holding, S.L. Spain 69.76% 30.24% 100.00% 100.00% Holding Company

5,199 1,031 6,479

Services and Promotions Miami LLC

USA 0.00% 100.00% 100.00% 100.00% Property 61 4 72

Shiloh III Wind Project, LLC USA 0.00% 100.00% 100.00% 100.00% Electricity production

305 10 266

SIAF LLC USA 0.00% 58.79% 100.00% 100.00% Finance -108 -164 0

Socur, S.A. (f) Uruguay 100.00% 0.00% 100.00% 100.00% Finance 37 27 59

222

Appendix







Carrying amount

Sol Orchard Imperial 1 LLC USA 0.00% 81.90% 100.00% 100.00% Electricity production

36 1 38

Sovereign Lease Holdings, LLC USA 0.00% 100.00% 100.00% 100.00% Financial services

132 4 127

Sovereign Precious Metals, LLC USA 0.00% 100.00% 100.00% 100.00% Precious metal commerce

144 0 14

Sovereign Securities Corporation, LLC

USA 0.00% 100.00% 100.00% 100.00% Inactive 54 0 50

Totta (Ireland), PLC (h) Ireland 0.00% 99.84% 100.00% 100.00% Finance 450 3 450

Totta Urbe - Empresa de Administração e Construções, S.A.

Portugal 0.00% 99.85% 100.00% 100.00% Property 140 2 100

Transolver Finance EFC, S.A. Spain 0.00% 51.00% 51.00% 50.00% Leasing 34 5 17

Wallcesa, S.A. Spain 100.00% 0.00% 100.00% 100.00% Securities investment

-942 0 0

a. Amount per books of each company at 31 December 2016 without considering, where appropriate, the interim dividends that have been made in the year. In the carrying amount (net cost of provision), the Group’s ownership percentage has been applied to the number of each of the holders, without considering the impairment of goodwill incurred in the consolidation process. The data of the foreign companies are converted into euros at the exchange rate at the end of the period.

b. Companies over which effective control is exercised.

c. Data from the latest approved financial statements as at 31 December 2015.

d. Data from the latest approved financial statements as at 31 March 2016.

e. Data from the latest approved financial statements as at 30 June 2016.

f. Data from the latest approved financial statements as at 30 September 2016.

g. Data from the latest approved financial statements as at 31 July 2016.

h. Data from the latest approved financial statements as at 30 November 2016.

i. Company resident in the UK for tax purposes.

j. Company in liquidation as at 31 December 2016.

k. Pursuant to Article 3 of Royal Decree 1159/2010, of 17 September approving the rules for the preparation of consolidated financial statements, in order to determine voting power, the voting power relating to subsidiaries or to other persons acting in their own name but on behalf of Group companies was added to the voting power directly held by the Parent. For these purposes, the number of votes corresponding to the Parent in relation to companies over which it exercises indirect control is the number corresponding to each subsidiary holding a direct ownership interest in such companies.

l. Data from the latest approved financial statements as at 28 February 2016.

1. The preference share issuer companies are detailed in Appendix III, together with other relevant information.


» Appendix ii

Companies in which Santander Group has ownership interests of more than 5%g, associates of Santander Group and joint ventures% of ownership held by the bank % of voting powerf Millions of eurosa

Company Location Direct Indirect 2016 2015 Line of businessType of company Assets

Capital and

Reserves


Aegon Santander Generales Seguros y Reaseguros, S.A.

Spain 0.00% 49.00% 49.00% 49.00% Insurance Multigroup 297 101 12

Aegon Santander Portugal Não Vida - Companhia de Seguros, S.A.

Portugal 0.00% 48.95% 49.00% 49.00% Insurance Multigroup 19 12 2

Aegon Santander Portugal Vida - Companhia de Seguros Vida, S.A.

Portugal 0.00% 48.95% 49.00% 49.00% Insurance Multigroup 88 19 5

Aegon Santander Vida Seguros y Reaseguros, S.A.

Spain 0.00% 49.00% 49.00% 49.00% Insurance Multigroup 259 143 23

Aguas de Fuensanta, S.A.

Spain 36.78% 0.00% 36.78% 36.78% Food Associated 0 -40 0

Allfunds Bank International S.A.

Luxembourg 0.00% 25.25% 50.00% 50.00% Banking Multigroup 213 25 5

Allfunds Bank, S.A. Spain 0.00% 25.25% 50.00% 50.00% Banking Multigroup 939 141 64

Attijariwafa Bank Société Anonyme (consolidado) (b)

Morocco 0.00% 5.26% 5.26% 5.26% Banking - 38,536 3,368 497

Aviva Powszechne Towarzystwo Emerytalne Aviva BZ WBK S.A. (b)

Poland 0.00% 6.94% 10.00% 10.00% Pension fund management company

- 85 52 26

Aviva Towarzystwo Ubezpieczen na Zycie S.A. (b)

Poland 0.00% 6.94% 10.00% 10.00% Insurance - 3,411 238 180

Bagoeta, S.L. (b) Spain 30.61% 0.00% 30.61% - Services - 177 8 -45

Banco Internacional da Guiné-Bissau, S.A. (d) (e)

Guinea Bissau

0.00% 48.92% 49.00% 49.00% Banking - 12 -30 -1

Banco RCI Brasil S.A. Brazil 0.00% 35.65% 39.89% 39.89% Leasing Multigroup 2,924 364 23

Bank of Beijing Consumer Finance Company

China 0.00% 20.00% 20.00% 20.00% Finance Associated 2,166 301 1

Bank of Shanghai Co., Ltd. (consolidado) (b)

China 6.48% 0.00% 6.48% 7.20% Banking - 197,965 10,900 1,782

BZ WBK-Aviva Towarzystwo Ubezpieczen na Zycie S.A.

Poland 0.00% 34.01% 49.00% 49.00% Insurance Associated 232 12 9

BZ WBK-Aviva Towarzystwo Ubezpieczen Ogólnych S.A.

Poland 0.00% 34.01% 49.00% 49.00% Insurance Associated 98 30 16

CNP Santander Insurance Europe Designated Activity Company

Ireland 49.00% 0.00% 49.00% 49.00% Insurance brokerage

Associated 664 61 15

CNP Santander Insurance Life Designated Activity Company

Ireland 49.00% 0.00% 49.00% 49.00% Insurance brokerage

Associated 1,102 133 32

224

Appendix




Capital and

Reserves


Compañía Española de Seguros de Crédito a la Exportación, S.A., Compañía de Seguros y Reaseguros (consolidado) (b)

Spain 20.53% 0.55% 21.08% 21.08% Credit insurance - 835 356 30

Federal Home Loan Bank of Pittsburgh (b)

USA 0.00% 8.66% 8.66% 17.60% Banking - 91,392 4,027 243

Federal Reserve Bank of Boston (b)

USA 0.00% 30.44% 30.44% 30.25% Banking - 108,409 2,393 -736

FIDC RCI Brasil I – Financiamento de Veículos (l)

Brazil - (h) - - Securitisation Multigroup 158 147 12

FIDC RN Brasil – Financiamento de Veículos


Fortune Auto Finance Co., Ltd

China 0.00% 50.00% 50.00% 50.00% Finance Multigroup 1,727 142 42

Gire S.A. Argentina 0.00% 57.92% 58.33% 58.33% Collection and payment services


Hyundai Capital UK Limited

United Kingdom

0.00% 50.01% 50.01% 50.01% Finance Multigroup 1,988 100 28

Imperial Holding S.C.A. (e) (i)

Luxembourg 0.00% 36.36% 36.36% 36.36% Securities investment

- 0 -112 0

Inbond Inversiones 2014, S.L.

Spain 40.00% 0.00% 40.00% 40.00% Financial studies Multigroup 226 222 3

Inversiones ZS América Dos Ltda

Chile 0.00% 49.00% 49.00% 49.00% Securities and real estate investment


Inversiones ZS América SpA

Chile 0.00% 49.00% 49.00% 49.00% Securities and real estate investment


Lusimovest Fundo de Investimento Imobiliário

Portugal 0.00% 25.73% 25.77% - Investment fund Associated 145 92 2

Merlin Properties, SOCIMI, S.A. (consolidado) (k)

Spain 16.83% 5.55% 22.38% - Property Associated - - -

Norchem Holdings e Negócios S.A.

Brazil 0.00% 19.44% 29.00% 29.00% Holding company Associated 37 26 2

Procapital - Investimentos Imobiliários, S.A. (e) (c)

Portugal 0.00% 39.96% 40.00% - Property - 3 -22 0

PSA Corretora de Seguros e Serviços Ltda.

Brazil 0.00% 44.69% 50.00% - Insurance Multigroup 1 0 0

PSA Insurance Europe Limited

Malta 0.00% 50.00% 50.00% 50.00% Insurance Multigroup 72 47 4

PSA Life Insurance Europe Limited

Malta 0.00% 50.00% 50.00% 50.00% Insurance Multigroup 23 9 3

Redsys Servicios de Procesamiento, S.L. (b)

Spain 17.56% 0.00% 17.56% 17.56% Cards Associated 126 24 8

Retama Real Estate, S.A.

Spain 0.00% 50.00% 50.00% 50.00% Services Multigroup 60 -32 -4

Rio Alto Gestão de Créditos e Participações, S.A.

Brazil 0.00% 44.69% 50.00% 50.00% Collection and payment services

- 177 132 56

SAM Investment Holdings Limited (m)

Jersey 0.00% 50.00% 50.00% 50.00% Holding company Multigroup 1,976 853 153




Capital and

Reserves


Santander Asset Management S.A. Administradora General de Fondos

Chile 0.00% 49.99% 49.99% 49.99% Fund management company

Multigroup 33 17 7

Santander Asset Management UK Limited

United Kingdom

0.00% 50.00% 50.00% 50.00% Investment fund and portfolio management

Multigroup 86 29 39

Santander Asset Management, S.A., S.G.I.I.C.


Multigroup 142 50 53

Santander Brasil Asset Management Distribuidora de Títulos e Valores Mobiliários S.A.

Brazil 0.00% 50.50% 50.50% 50.50% Management company

Multigroup 65 40 2

Santander Brasil Gestão de Recursos Ltda.

Brazil 0.00% 50.00% 50.00% 50.00% Real estate investment

Multigroup 627 560 41

Santander Elavon Merchant Services Entidad de Pago, S.L.

Spain 49.00% 0.00% 49.00% 49.00% Payment services Multigroup 266 174 3

Santander Pensiones, S.A., E.G.F.P.

Spain 0.00% 50.00% 50.00% 50.00% Pension fund management company

Multigroup 42 24 19

Saudi Hollandi Bank (consolidado) (b)

Saudi Arabia 0.00% 11.16% 11.16% 11.16% Banking - 27,914 2,584 522

Sociedad de Gestión de Activos Procedentes de la Reestructuración Bancaria, S.A. (b)

Spain 16.62% 0.00% 16.62% 17.28% Financial services - 47,627 -1,218 0

Stephens Ranch Wind Energy Holdco LLC (consolidado)

USA 0.00% 28.80% 28.80% 44.00% Electricity production

- 306 289 -1

Tecnologia Bancária S.A.

Brazil 0.00% 18.54% 19.81% 19.81% Atm Associated 382 113 5

Teka Industrial, S.A. (consolidado) (b)

Spain 0.00% 9.42% 9.42% 9.42% Household appliances

- 611 166 9

Testa Residencial, SOCIMI, S.A. (consolidado)

Spain 34.52% 11.68% 46.21% - Property Associated 1,072 637 -3

Tonopah Solar Energy Holdings I, LLC (consolidado)

USA 0.00% 26.80% 26.80% 26.80% Holding company Multigroup 919 327 -57

Transbank S.A. Chile 0.00% 16.78% 25.00% 25.00% Cards Associated 1,004 63 7

U.C.I., S.A. Spain 50.00% 0.00% 50.00% 50.00% Holding company Multigroup 311 50 25

Unicre-Instituição Financeira de Crédito, S.A.

Portugal 0.00% 21.47% 21.50% 21.50% Finance Associated 324 22 57

Unión de Créditos Inmobiliarios, S.A., EFC

Spain 0.00% 50.00% 50.00% 50.00% Mortgages Multigroup 12,603 361 12

Uro Property Holdings SOCIMI, S.A. (b)

Spain 14.96% 0.00% 14.96% 22.77% Property - 1,718 121 68

Venda de Veículos Fundo de Investimento em Direitos Creditórios (l)


Webmotors S.A. Brazil 0.00% 65.49% 70.00% 70.00% Services Multigroup 42 27 10

226

Appendix




Capital and

Reserves


Zurich Santander Brasil Seguros e Previdência S.A.

Brazil 0.00% 48.79% 48.79% 48.79% Insurance Associated 12,759 654 202

Zurich Santander Brasil Seguros S.A.

Brazil 0.00% 48.79% 48.79% 48.79% Insurance Associated 256 -3 47

Zurich Santander Insurance América, S.L.

Spain 49.00% 0.00% 49.00% 49.00% Holding company Associated 1,519 1,510 246

Zurich Santander Seguros Argentina S.A. (j)

Argentina 0.00% 49.00% 49.00% 49.00% Insurance Associated 70 14 22

Zurich Santander Seguros de Vida Chile S.A.

Chile 0.00% 49.00% 49.00% 49.00% Insurance Associated 301 54 51

Zurich Santander Seguros Generales Chile S.A.

Chile 0.00% 49.00% 49.00% 49.00% Insurance Associated 203 36 14

Zurich Santander Seguros México, S.A.

Mexico 0.00% 49.00% 49.00% 49.00% Insurance Associated 725 44 159

Zurich Santander Seguros Uruguay, S.A.

Uruguay 0.00% 49.00% 49.00% 49.00% Insurance Associated 11 8 1

a. Amounts per the books of each company generally as at 31 December 2016, unless otherwise stated, because the financial statements have not yet been authorized for issue. The data on foreign companies were translated to euros at the year-end exchange rates.

b. Data from the latest approved financial statements as at 31 December 2015

c. Data from the latest approved financial statements as at 30 December 2002.

d. Data from the latest approved financial statements as at 30 April 2002.

e. Company in liquidation as at 31 December 2016.

f. Pursuant to Article 3 of Royal Decree 1159/2010, of 17 September approving the rules for the preparation of consolidated financial statements, in order to determine voting power, the voting power relating to subsidiaries or to other persons acting in their own name but on behalf of Group companies was added to the voting power directly held by the Parent, For these purposes, the number of votes corresponding to the Parent in relation to companies over which it exercises indirect control is the number corresponding to each subsidiary holding a direct ownership interest in such companies.

g. Excluding the Group companies listed in Appendix I and those of negligible interest with respect to the fair presentation that the consolidated financial statements must express (pursuant to Article 48 of the Spanish Commercial Code and Article 260 of the Spanish Limited Liability Companies Law).

h. Companies over which the non-subsidiary investee of the Group exercises effective control.

i. Data from the latest available approved financial statements as at 31 October 2015

j. Data from the latest approved financial statements as at 30 June 2016

k. Recent create company without approved financial stataments available.

l. Data from the latest approved financial statements as at 31 May 2016.

m. Company resident in the UK for tax purposes.


» Appendix iii

Preference share issuer subsidiaries% ownership held

by the bank Millions of eurosa

Company Location Direct IndirectLine of business

Share capital Reserves

Preference share cost


Abbey National Treasury (Structured Solutions) Limited United Kingdom 0.00% 100.00% Finance 0 0 0 0Emisora Santander España, S.A. Unipersonal Spain 100.00% 0.00% Finance 3 0 0 -1Santander Emisora 150, S.A. Unipersonal Spain 100.00% 0.00% Finance 0 1 0 0Santander Finance Capital, S.A. Unipersonal Spain 100.00% 0.00% Finance 0 1 10 1Santander Finance Preferred, S.A. Unipersonal Spain 100.00% 0.00% Finance 0 6 18 0Santander International Preferred, S.A. Unipersonal Spain 100.00% 0.00% Finance 0 0 18 0Sovereign Real Estate Investment Trust USA 0.00% 100.00% Finance 5,451 -3,289 68 37

a. Amounts per the books of each company as at 31 December 2016, translated to euros (in the case of foreign companies) at the year-end exchange rates.

» Appendix iV

Notifications of acquisitions and disposals of investments in 2016(Article 155 of the Spanish Limited Liability Companies Law and Article 125 of the Spanish Securities Market Law).

On 2 November 2016, the CNMV registered a notification from Banco Santander which disclosed that Santander Group’s ownership interest in MERLIN PROPERTIES, SOCIMI, S.A. had fallen exceeded 22.86% on 26 October 2016.

» Appendix V

Other information on the Group’s banksA) Following is certain information on the share capital of the Group’s main banks based on their total assets.

1. Santander UK plc

a) Number of financial equity instruments held by the Group Santander UK plc has issued 31,051,768,866 ordinary shares with a par value of GBP 0.10 each, amounting to GBP 3,105,176,886.6. On 10 January 2014, Cántabro Catalana de Inversiones, S.A. transferred one ordinary share with a par value of GBP 0.10 to Banco Santander, S.A. for GBP 1. Subsequently, on 1 April 2014, Banco Santander, S.A. transferred 24,117,268,866.6 ordinary shares with a par value of GBP 0.10 each to Santander UK Group Holdings Limited for GBP 2,411,726,886.6. Also, on 1 April 2014, Santusa Holding, S.L. transferred 6,934,500,000 shares with a par value of GBP 0.10 each to Santander UK Group Holdings Limited for GBP 693,450,000. As at 31 December 2015, the Group holds all the ordinary share capital (31,051,768,866 ordinary shares with a par value of GBP 0.10 each, amounting to GBP 3,105,176,886.6) through Santander UK Group Holdings Plc.

On 23 October 1995, Santander UK plc issued 10.0625% exchangeable capital securities amounting to GBP 200,000,000, exchangeable into 200,000,000 10.375% non-cumulative sterling preference shares with a par value of GBP 1 each. At 31 December 2016, the Group held 30.10% of the 10.0625% exchangeable capital securities (amounting to GBP 66,147,000) through Banco Santander, S.A.

Also, on 23 October 1995, Santander UK plc issued 10.375% non-cumulative sterling preference shares amounting to GBP 100,000,000 with a par value of GBP 1 each, and on 13 February 1996 Santander UK plc issued additional 10.375% non-cumulative sterling preference shares amounting to GBP 100,000,000 with a par value of GBP 1 each. At 31 December 2016, the Group held 32% of the 10.375% non-cumulative sterling preference shares (amounting to GBP 63,913,355) through Banco Santander, S.A..

On 9 June 1997, Santander UK plc issued 8.625% non-cumulative sterling preference shares amounting to GBP 125,000,000 with a par value of GBP 1 each. At 31 December 2016, the Group held 80.40% of the 8.625% non-cumulative sterling preference shares (amounting to GBP 100,487,938) through Banco Santander, S.A..

On 28 April 2010, pursuant to current legislation, preference shares of Alliance & Leicester Limited (formerly Alliance & Leicester plc) were exchanged for 300,002 redeemable fixed/floating rate series A non-cumulative preference shares of Santander UK plc amounting to GBP 300,002,000, with a par value of GBP 1 each and a liquidation preference of GBP 1,000. On 16 December 2014, Santander UK plc repurchased 265,069 redeemable fixed/floating rate series A non-cumulative preference shares for GBP 265,069,000. On 12 June 2015, Santander UK plc repurchased 21,136 redeemable fixed/floating rate series A non-cumulative preference shares for GBP 22,509,840. On 1 July 2016, Santander UK Plc repurchases 17 redeemable fixed/floating rate series A non-cumulative for GBP 17,000. At 31 December 2016, 13,780 redeemable fixed/floating rate series A non-cumulative preference shares, amounting to GBP 13,780,000, were still outstanding.

228

Appendix


b) Capital increases in progress At 31 December 2016, there were no approved capital increases.

c) Share capital authorized by the shareholders at the general meeting The shareholders at the Annual General Meeting held on 31 March 2016 resolved to unconditionally authorize the company to carry out the following repurchases of share capital.

1) the repurchase of its own 8.625% non-cumulative sterling preference shares subject to the following conditions:

a) The company may repurchase up to 125,000,000 of the 8.625% non-cumulative sterling preference shares.

b) The lowest price that the company may pay for the 8.625% non-cumulative sterling preference shares will be 75% of the average market price of the preference shares for the five days prior to the purchase; and

c) The highest price (excluding costs) that the company may pay for each 8.625% non-cumulative preference sterling share will be 125% of the average market price of the preference shares for the five days prior to the purchase.

It is hereby stated that this authorisation will expire at the date of the company’s next Annual General Meeting unless it is renewed, amended or revoked by the company. However, prior to such expiry, the company may enter into an agreement on the repurchase of its 8.625% preference shares even if the purchase is finalised after this authorisation expires.

2) the repurchase of its own 10.375% non-cumulative sterling preference shares subject to the following conditions:

a) The company may repurchase up to 200,000,000 of the 10.375% preference shares;

b) The lowest price that the company may pay for the 10.375% non-cumulative sterling preference shares will be 75% of the average market price of the preference shares for the five days prior to the purchase; and

c) The highest price (excluding costs) that the company may pay for each 10.375% non-cumulative preference sterling share will be 125% of the average market price of the preference shares for the five days prior to the purchase.

It is hereby stated that this authorisation will expire at the date of the company’s next Annual General Meeting unless it is renewed, amended or revoked by the company. However, prior to such expiry, the company may enter into an agreement on the repurchase of its 10.375% preference shares even if the purchase is finalised after this authorisation expires.

3) the repurchase of its own redeemable fixed/floating rate series A non-cumulative preference shares subject to the following conditions:

a) The company may repurchase up to 13,797 redeemable fixed/floating rate series A non-cumulative preference shares;

b) The lowest price that the company may pay for the redeemable fixed/floating rate series A non-cumulative preference shares will be 75% of the average market price of the preference shares for the five days prior to the purchase; and

c) The highest price (excluding costs) that the company may pay for each of the redeemable fixed/floating rate series A non-cumulative preference shares will be 125% of the average market price of the preference shares for the five days prior to the purchase.

It is hereby stated that this authorisation will expire at the date of the company’s next Annual General Meeting unless it is renewed, amended or revoked by the company. However, prior to such expiry, the company may enter into an agreement on the repurchase of its redeemable fixed/floating rate series A non-cumulative preference shares even if the purchase is finalised after this authorisation expires.

However, prior to such expiry, the company may submit bids or adopt resolutions that could require the allocation of shares and the directors may allocate shares in accordance with any bid or resolution, considering the expiry of the authorisation granted in this resolution.

In accordance with this resolution, any previous authorisations granted to the directors and not exercised for the allocation of shares are hereby revoked and substituted, notwithstanding any allocation of shares or grant of rights already completed, offered or agreed.

d) Rights on founder’s shares, “rights” bonds, convertible debentures and similar securities or rightsNot applicable.

e) Specific circumstances that restrict the availability of reserves Not applicable.

f) Non-Group entities which hold, directly or through subsidiaries, 10% or more of equity Not applicable.

g) Quoted equity instruments Not applicable.

2. Abbey National Treasury Services plc

a) Number of financial equity instruments held by the Group The Group holds ordinary shares amounting to GBP 2,549,000,000 through Santander UK plc (2,548,999,999 ordinary shares with a par value of GBP 1 each) and Abbey National Nominees Limited (1 ordinary share with a par value of GBP 1).


The Group also holds 1,000 tracker shares (shares without voting rights but with preferential dividend rights) amounting to GBP 1,000 and 1,000 B tracker shares amounting to GBP 1,000 through Santander UK plc, both with a par value of GBP 1 each.


c) Capital authorized by the shareholders at the general meeting Not applicable.

d) Rights on founder’s shares, “rights” bonds, convertible debentures and similar securities or rights Not applicable.




3. Banco Santander (Brasil) S.A.

a) Number of financial equity instruments held by the Group The Group holds 3,440,170,512 ordinary shares and 3,273,507,089 preference shares through Banco Santander, S.A. and its subsidiaries Sterrebeeck B.V., Grupo Empresarial Santander, S.L. and Banco Madesant - Sociedade Unipessoal, S.A.

The shares composing the share capital of Banco Santander (Brasil) S.A. have no par value and there are no capital payments payable. At 2016 year-end the bank’s treasury shares consisted of 25,785,923 ordinary shares and 25,785,923 preference shares, with a total of 51,571,846 shares.

In accordance with current Bylaws (Article 5.7) the preference shares do not confer voting rights on their holders, except under the following circumstances:

a) In the event of the transformation, merger, consolidation or spin-off of the company.

b) In the event of approval of agreements between the company and the shareholders, either directly, through third parties or other companies in which the shareholders hold a stake, provided that, due to legal or bylaw provisions, they are submitted to a general meeting.

c) In the event of an assessment of the assets used to increase the company’s share capital.

The General Assembly may, at any moment, decide to convert the preference shares into ordinary shares, establishing a reason for the conversion.

However, the preference shares do have the following advantages (Article 5.6):

a) Their dividends are 10% higher than those on ordinary shares.

b) Priority in the distribution of dividends.

c) Participation, on the same terms as ordinary shares, in capital increases resulting from the capitalisation of reserves and profits and in the distribution of bonus shares arising from the capitalisation of retained earnings, reserves or any other funds.

d) Priority in the reimbursement of capital in the event of the dissolution of the company.

e) In the event of a public offering due to a change in control of the company, the holders of preference shares are guaranteed the right to sell the shares at the same price paid for the block of shares that changed hands as part of the change of control, i.e. they are treated the same as shareholders with voting rights.


c) Capital authorized by the shareholders at the general meeting The company is authorized to increase share capital, subject to approval by the Board of Directors, up to a limit of 9,090,909,090 ordinary shares or preference shares, and without the need to maintain any ratio between any of the different classes of shares, provided they remain within the limits of the maximum number of preference shares established by Law.

At present the share capital consists of 7,563,082,417 shares (3,850,970,714 ordinary shares and 3,712,111,703 preference shares).

d) Rights on founder’s shares, “rights” bonds, convertible debentures and similar securities or rights At the general meeting held on 21 December 2016 the shareholders approved the rules relating to the 2016 deferred remuneration plans for the directors, management and other employees of the company and of companies under its control. The delivery of the shares is linked to the achievement of certain targets.

e) Specific circumstances that restrict the availability of reserves The only restriction on the availability of Banco Santander (Brasil) S.A.’s reserves relates to the legal reserve (restricted reserves), which can only be used to offset losses or to increase capital.

The legal reserve is provided for in Article 196 of the Spanish Public Limited Liability Companies Law, which establishes that before being allocated to any other purpose, 5% of profits must be transferred to the legal reserve, which must not exceed 20% of share capital.


230

Appendix


5. Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México

a) Number of financial equity instruments held by the Group The Group, through the companies Grupo Financiero Santander México, S.A.B. de C.V. And Santander Global Facilities, S.A. de C.V. (Mexico) holds 80,848,278,413 common shares, which constitute 99.99% of the capital stock of Banco Santander (Mexico), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México, as of December 31, 2016.

b) Capital increases in progress By Ordinary and Extraordinary Shareholders’ Meeting held on December 5, 2016, it was approved to increase the Company’s capital stock, up to the amount of $ 786,283,883.00 MN, (Seven hundred eighty-six million two hundred eighty-three thousand eight hundred and eighty-three pesos 00 / 100 MN) through the issuance of 7,862,838,825 new shares representing the “F” Series of the Company’s capital, all of them ordinary, nominative shares with a par value of $ 0.10 MN each, which will be held in treasury Company as authorized capital to guarantee the possible conversion of obligations into shares in relation to the Issue agreed by said Assembly.

c) Capital autorizado por la junta de accionistasAt the General Shareholders’ Meeting held on December 5, 2016, the increase in the authorized capital stock of Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México, was approved, up to the amount of $ 786,283,883.00 MN, (Seven hundred eighty-six million two hundred eighty-three thousand eight hundred and eighty-three pesos 00/100 MN), through the issuance of 7,862,838,825 new shares representing the Series “F”, which will be held in treasury of the Company as authorized capital for Guarantee the possible conversion of obligations into shares in relation to the Issue agreed by the Assembly.

In relation to the foregoing, until the shares are subscribed, they will remain in the treasury of the company, so that the subscribed and paid-up capital stock continues to be in the amount of 8,085,540,380.30 Mexican pesos, represented by a total Of 80,855,403,803 shares, fully subscribed and paid, with a nominal value of 0.10 Mexican pesos per share.

d) Rights on founder’s shares, bonds or debt issues, convertible debentures and similar securities or rights (i) At the Board of Directors meeting held on 22 October 2015

the directors acknowledged their awareness of the situation of the debt issue of Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México that had been ratified at the board meeting held on 17 October 2013 for the issue of debt up to USD 6,500 million in local or international markets. They stipulated that the debt should be senior or subordinated for a maximum term of 15 years and that debt instruments that qualify as capital under current legislation should be included, and resolved that such issue may be instrumented individually or through various issue programmes.

At present, the detail of Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México debt issue is as follows:

g) Quoted capital instruments All the shares are listed on the Brazilian Securities, Commodities and Futures Exchange (BM&FBOVESPA) and the share deposit certificates (units) are listed on the New York Stock Exchange (NYSE).

4. Santander Bank, National Association

a) Number of financial equity instruments held by the GroupAt 31 December 2016 the Group held 530,391,043 ordinary shares that carry the same voting and dividend acquisition rights over Santander Holdings USA, Inc. (SHUSA). This holding company and Independence Community Bank Corp. (ICBC) hold 1,237 ordinary shares with a par value of USD 1 each, which carry the same voting rights. These shares constitute all the share capital of Santander Bank, National Association (SBNA).

SHUSA holds an 80.84% ownership interest in SBNA, and the remaining 19.16% belongs to ICBC. ICBC is wholly owned by SHUSA. There is no shareholders’ meeting for the ordinary shares of SBNA.

b) Capital increases in progress At 31 December 2016 there were no approved capital increases.







(v) At a meeting of the Board of Directors of Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México on October 27, 2016, the issuance of debt was approved for up to US $ 500 million dollars or its equivalent in pesos in Mexico. The Ordinary and Extraordinary Shareholders’ Meeting of Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México éxico, dated December 5, 2016, approved, among others, the issuance of a financial instrument that complies with the regulatory capital requirements established by the Basel III criteria and which was considered as Basic non-core capital, for up to US $ 500 million.

On December 29, 2016, Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México, issued a private issue abroad of subordinated, non-preferred, perpetual and convertible bonds Social, for a total amount of US $ 500,000,000 dollars, which had the character of a back-to-back issuance, as a guarantee of liquidity of the non-preferred, perpetual and subordinated subordinated debentures, issued by Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México.

e) Specific circumstances that restrict the availability of reserves Pursuant to the Mexican Credit Institutions Law and the general provisions applicable to credit institutions, the Mexican Companies Law and the institutions’ own Bylaws, universal banking institutions are required to constitute or increase capital reserves for the purposes of ensuring solvency and protecting payment systems and savers.

The bank increases its legal reserve annually directly from the profit obtained in the year.

The bank must recognise the various reserves as stipulated in the legal provisions applicable to credit institutions. Credit loss reserves are calculated on the basis of the credit rating assigned to each loan and are released when the rating of the related loan improves or when the loan is settled.

Instrument Type Term Amount Undrawn balance

Issue programme in connection with stock market certificates and term deposit certificates of deposit Revolving 19/feb/2021

Up to MXN 55,000,000,000.00

Up to MXN 45,000,000,000

Private structured bank bond certificate without public offer Non-revolving (*) 24/feb/2021

Up to MXN 20,000,000,000.00

Up to MXN 5,710,000,000.00

Private structured bank bond certificate

Authorization in process by CNBV

Up to MXN 10,000,000,000.00 In process

Senior Bond Non-resolving 09/nov/2022Up to USD 1,000,000,000,000 N/A

Capital Instruments Non-solving 30/jan/2024Up to USD 1,300,000,000,000 N/A

Issue of Tier II subordinated debt in international markets Non-revolving Perpetual

Up to USD 500,000,000,000 N/A

* The issue of private structured bank bonds is non-revolving. Once the amount established in the related certificate is placed, a new certificate is issued for the authorized amount.

(ii) The Board of Directors at its meeting held on January 27, 2011 approved the general conditions for the issuance of senior debt in international markets. On October 18, 2012, the issuance of $ 500 million and $ 1 billion was authorized for a period of 5 to 10 years. The issue was approved with the purpose of obtaining resources to fund the increase of business assets and the Bank’s liquidity management. Pursuant to these resolutions adopted by the Board of Directors, on November 9, 2012, a debt of US $ 1.

(iii) On December 27, 2013, Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México, issued a total amount of US $ 1,300,000,000 in subordinated notes that meet the capital requirements provided By the Basel III criteria for complementary capital / Tier 2 at a rate of 5.95% maturing on 30 January 2024. The parent company of Banco Santander (Mexico), SA, Institución de Banca Múltiple, Grupo Financiero Santander México, Banco Santander, S.A, Spain, agreed to purchase 975,000,000 American dollars, i.e., 75% of the total amount of the notes.

These notes were offered through a private placement to qualified institutional buyers only in accordance with Rule 144A under the US Securities Act of 1933 and subsequent amendments thereto. Outside the US, they were offered in accordance with Regulation S of the Securities Act.

The issue was approved with a view to increasing the efficiency of the bank’s capital structure, adapting the bank’s profile with regard to capitalisation to that of its competitors and obtaining greater returns on capital with the same strength of capital and capacity for growth of risk-weighted assets.

(iv) The shareholders at the general meeting held on 14 May 2012 ratified the resolution adopted by the shareholders at the extraordinary general meeting held on 17 March 2009, which approved the arrangement of a collective loan from the shareholders for USD 1,000,000,000 through the placement of unsecured subordinated non-preference debentures not convertible into shares. This issue had not yet been launched at the reporting date.

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f) Non-Group entities which hold, directly or through subsidiaries, 10% or more of equityNot applicable.


8. Banco Santander - Chile

a) Number of financial equity instruments held by the Group The Group holds a 67% ownership interest in its subsidiary in Chile corresponding to 126,593,017,845 ordinary shares of Banco Santander - Chile through its subsidiaries: Santander Chile Holding S.A. with 66,822,519,695 ordinary shares, Teatinos Siglo XXI Inversiones S.A., with 59,770,481,573 ordinary shares and Santander Inversiones S.A. with 16,577 fully subscribed and paid ordinary shares that carry the same voting and dividend rights.


c) Capital authorized by the shareholders at the general meeting share capital at 31 december 2016 amounted to clp 891,302,881,691.


e) Specific circumstances that restrict the availability of reserves Remittances to foreign investors in relation to investments made under the Statute of Foreign Investment (Decree-Law 600/1974) and the amendments thereto require the prior authorisation of the foreign investment committee.


g) Quoted equity instruments All the shares are listed on the Chilean stock exchanges and, through American Depositary Receipts (ADRs), on the New York Stock Exchange (NYSE).


g) Quoted capital instruments Not applicable.

6. Banco Santander Totta, S.A

a) Number of equity instruments held by the Group The Group holds 1,256,078,158 ordinary shares through its subsidiaries: Santander Totta, SGPS, S.A. with 1,241,179,513 shares, Taxagest Sociedade Gestora de Participações Sociais, S.A. with 14,593,315 shares, and Banco Santander Totta, S.A. with 305,330 treasury shares, all of which have a par value of EUR 1 each and identical voting and dividend rights and are subscribed and paid in full.




e) Specific circumstances that restrict the availability of reserves Under Article 296 of the Portuguese Companies’ Code, the legal and merger reserves can only be used to offset losses or to increase capital.

non-current asset revaluation reserves are regulated by decree- law 31/98, under which losses can be offset or capital increased by the amounts for which the underlying asset is depreciated, amortised or sold.



7. Santander Consumer Bank AG

a) Number of financial equity instruments held by the GroupAt 31 December 2016, through Santander Consumer Holding GmbH, the Group held 30,002 ordinary shares with a par value of EUR 1,000 each, all of which carry the same voting rights.




» Appendix Vi

Annual banking reportThe Group’s total tax contribution in 2016 (taxes incurred directly by the Group and the collection of taxes incurred by third parties generated in the course of its economic activities) exceeded EUR 15,800 million of which more than EUR 6,000 million correspond to own taxes (Corporate income tax, non-recoverable VAT and other indirect taxes, payments to the Social Security on behalf of the employer and other taxes on payroll and other taxes and levies).

This Annual Banking Report was prepared in compliance with Article 89 of Directive 2013/36/EU of the European Parliament and of the Council, of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, and its transposition into Spanish law pursuant to Article 87 of Law 10/2014, of 26 June on the regulation, supervision and capital adequacy of credit institutions.

Pursuant to the aforementioned Article, from 1 January 2015, credit institutions must send the Bank of Spain and publish annually a report as an appendix to the financial statements audited in accordance with the legislation regulating audits of financial statements, which specifies, by country in which they are established, the following information on a consolidated basis for each year:

a) Name(s), nature of activities and geographical location.b) Turnover.c) Number of employees on a full time equivalent basis.d) Gross profit or loss before tax.e) Tax on profit or loss.f) Public subsidies received.

Following is a detail of the criteria used to prepare the annual banking report for 2016:

a) Name(s), nature of activities and geographical locationThe aforementioned information is available in Appendices I and III to the Group’s consolidated financial statements, which contain details of the companies operating in each jurisdiction, including, among other information, their name(s), geographical location and the nature of their activities.

As can be seen in the aforementioned Appendices, the main activity carried on by the Group in the various jurisdictions in which it operates is commercial banking. The Group operates mainly in ten markets through a model of subsidiaries that are autonomous in capital and liquidity terms, which has clear strategic and regulatory advantages, since it limits the risk of contagion between Group units, imposes a double layer of global and local oversight and facilitates crisis management and resolution. The number of Group offices totals 12,235 (the largest commercial network of any international bank) and these offices provide our customers with all their basic financial needs.

9. Bank Zachodni WBK S. A.

a) Number of financial equity instruments held by the GroupAt 31 December 2016, Banco Santander, S.A. held 68,880,774 ordinary shares with a par value of PLN 10 each, all of which carry the same voting rights.

b) Capital increases in progress At 31 december 2016, there were no approved capital increases.

c) Capital authorized by the shareholders at the general meeting not applicable.

d) Rights on founder’s shares, “rights” bonds, convertible debentures and similar securities or rights At the general meeting held on 30 June 2014 the shareholders resolved to approve the “Incentive Scheme V” as an initiative to attract, motivate and retain the bank’s employees. Delivery of the shares is tied to the achievement of certain targets in the years from 2014 to 2016. The bank considers that the exercise of these rights might give rise to the issuance of no more than 250,000 shares.



g) Quoted equity instruments All the shares of Bank Zachodni WBK s.A. are listed on the Warsaw stock exchange.

B) the restrictions on the ability to access or use the assets and settle the liabilities of the Group, as required under paragraph 13 of iFrs 12, are described below.

In certain jurisdictions, restrictions have been established on the distribution of dividends on the basis of the new, much more stringent capital adequacy regulations. However, there is currently no evidence of any practical or legal impediment to the transfer of funds by Group subsidiaries to the Parent in the form of dividends, loans or advances, repatriation of capital or any other means.

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The foregoing amounts are part of the statement of cash flows (EUR 2,872 million during 2016, an effective rate 26.7%) and, therefore, differ from the income tax expense recognised in the consolidated income statement (EUR 3,282 million during 2016, an effective rate 30.5%). Such is the case because the tax legislation of each country establishes:

•the time at which taxes must be paid and, normally, there is a timing mismatch between the dates of payment and the date of generation of the income bearing the tax.

•its own criteria for calculating the tax and establishes temporary or permanent restrictions on expense deduction, exemptions, relief or deferrals of certain income, thereby generating the related differences between the accounting profit (or loss) and taxable profit (or tax loss) which is ultimately taxed; tax loss carryforwards from prior years, tax credits and/or relief, etc. must also be added to this. Also, in certain cases special regimes are established, such as the tax consolidation of companies in the same jurisdiction, etc.

f) Public subsidies receivedIn the context of the disclosures required by current legislation, this term was interpreted to mean any aid or subsidy in line with the European Commission’s State Aid Guide and, in such context, the Group companies did not receive public subsidies in 2016.

b) TurnoverFor the purposes of this report, turnover is considered to be gross income, as defined and presented in the consolidated income statement that forms part of the Group’s consolidated financial statements.

c) Number of employees on a full time equivalent basisThe data on employees on a full time equivalent basis were obtained from the average headcount of each jurisdiction.

d) Gross profit or loss before taxFor the purposes of this report, gross profit or loss before tax is considered to be profit or loss before tax, as defined and presented in the consolidated income statement that forms part of the Group’s consolidated financial statements.

e) Tax on profit or lossIn the absence of specific criteria, this is the amount of tax effectively paid in respect of the taxes the effect of which is recognised in Income tax in the consolidated income statement.

Taxes effectively paid in the year by each of the companies in each jurisdiction include:

•supplementary payments relating to income tax returns, normally for prior years.

•advances, prepayments, withholdings made or borne in respect of tax on profit or loss for the year. Given their scantly representative amount, it was decided that taxes borne abroad would be included in the jurisdiction of the company that bore them.

•refunds collected in the year with respect to returns for prior years that resulted in a refund.

•where appropriate, the tax payable arising from tax assessments and litigation relating to these taxes.


The detail of the information for 2016 is as follows:

2016

JurisdictionTurnover

(millions of euros) Employees

Gross profit or loss before tax (millions

of euros)

Tax on profit

or loss (millions of euros)

Germany 1,537 4,792 505 15

Argentina 1,320 7,774 461 91

Australia 4 6 1 -

Austria 142 373 63 10

The Bahamas (5) 43 (20) -

Belgium 87 170 51 5

Brazil1 11,222 45,245 2,796 1,133

Canada 38 186 6 2

Chile 2,434 11,996 941 163

China 64 214 (7) (1)

Colombia 12 94 - 1

Spain2 4,967 28,976 (821) (114)

United States3 7,368 15,621 995 (122)

Denmark 145 215 77 21

Finland 92 148 56 17

France 495 897 266 109

Hungary - 21 - -

Ireland 69 6 40 -

Isle of Man 6 18 3 (1)

Cayman Islands (1) - (1) -

Italy 381 834 165 (1)

Jersey (42) 486 (45) 1

Luxemburg 3 - 3 -

Malta 3 - 3 -

Mexico4 3,350 17,735 1,119 473

Norway 326 491 158 32

The Netherlands 88 269 45 36

Panama 6 5 5 -

Paraguay - - - -

Peru 53 151 26 9

Poland 1,682 14,610 703 236

Portugal5 1,322 6,898 591 79

Puerto Rico 349 1,559 (11) 16

United Kingdom 6,104 24,107 2,362 622

Singapore 3 12 (2) 1

Sweden 159 317 67 3

Switzerland 103 205 42 12

Uruguay 346 1,674 125 24

Consolidated Group total 44,232 186,148 10,768 2,872

1. Including the information relating to a branch in the Cayman Islands the profits of which are taxed in full in Brazil. The contribution of this branch profit before tax from continuing operations 2016 is EUR 347 million.

2. Includes the corporate center. During 2016, there have been tax refunds in relation to fiscal years 2014 and 2015, the latter in advance- ; so deducting its effect the amount of taxes paid would have been EUR: +175 million.

3. Tax accrued in the year in this jurisdiction amounted to approximately EUR 300 million due mainly to the difference in deferred taxes.

4. Including the information on a branch in the Bahamas the profits of which are taxed in full in Mexico. In 2016 the contribution of this branch to operating profit before tax from continuing operations was EUR 15 million.

5. Including the information relating to the branch in the UK, which is taxed both in the UK and in Portugal. In 2016 the contribution of this branch to profit before tax from continuing operations was EUR 84 million.

At 31 December 2016, the Group’s return on assets (ROA) was 0.56%.

appendix - santanderannualreport.com · 214 appendix auditors’ report and nnu l consolid ted...

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