Santander is having great success with its paid-for 123 account in the UK, with 4.8 million customers putting an average of £1 billion in the collective accounts each month.
The current accounts offers cashback on bills, monthly interest of 3%, and access to deals, at a cost of £5 a month.
However, to reap the rewards customers must deposit £500 a month into the account. If all 4.8 million of Santander’s 123 customers were doing that the bank would rake in deposits of £2.4 billion each month, suggesting not everyone is make use of the account.
The Spanish bank made the figures public as part of its first quarter results, which show falling profits but beat analysts forecasts. Here are the key figures:
- First quarter profit down 5% on last year’s figure to €1.63 billion (£1.26 billion), but this is above average analyst estimates of €1.5 billion (£1.1 billion);
- Profits from the UK business, which contributes 23% earnings, down 4%;
- Loans up 4% to €787 billion (£610.5 billion);
- UK: Lending grew 3%, with 11% increase in financing to businesses and 5% in customer funds;
- Digital customers up 17% to 17.8 million.
Santander blames the fall in profits on “the depreciation against the euro of the currencies of all the countries where the Group is present, except the dollar.” Without this, it says earnings would be up by 8% in the quarter.
Group chair Ana Botin says in the results:
Our commercial transformation continues to perform well in all our main markets, growing loyalty of customers as a result of improvements in service and satisfaction, and embedding our culture of doing things in a Simple, Personal and Fair manner, and helping customers to prosper.
Santander’s figures look pretty good in comparison to Barclays, which on Wednesday announced a 25% drop in first-quarter profits. British banks are lagging behind European counterparts in part because of hefty PPI misselling fines.