Table of Contents

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of April, 2018

Commission File Number: 001-12518

Banco Santander, S.A.

(Exact name of registrant as specified in its charter)

Ciudad Grupo Santander

28660 Boadilla del Monte (Madrid) Spain

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  ☒              Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes  ☐             No  ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes  ☐             No  ☒

Table of Contents

Banco Santander, S.A.

TABLE OF CONTENTS

Table of Contents

Item 1

Santander attributable profit up 10% year-on-year in Q1 2018 to €2,054 million

The Group achieved a Return on Tangible Equity (RoTE) of 12.4% with its CET1 capital ratio reaching 11%

Madrid, 24 April 2018 - PRESS RELEASE

Banco Santander Group Executive Chairman, Ana Botín, said:

“2018 has started well, with the Group generating double digit profit growth driven by strong results in Brazil, Spain and Mexico, and improved performance in the U.S.

“Across all our markets we are executing our strategy successfully, accelerating our digital transformation through increased collaboration across the Group, and leveraging the scale of our business. This, in turn, is delivering more recurrent and sustainable earnings.

“Importantly, we are achieving these results in the right way. We’re focusing on being more simple, personal and fair in all we do. And we are working hard to help people and businesses prosper by supporting inclusive and sustainable growth. These are the foundations on which we are building a more responsible bank - and a bank that earns the lasting loyalty of its people, customers, shareholders and communities.

“The outlook for 2018 remains positive, and I am confident our teams will execute well so we reach our objectives this year, as well as delivering profitable and responsible growth going forward.”

Corporate Communications		1
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

Results Summary (Q118 v Q117)

Banco Santander S.A. (Santander) increased attributable profit during the first quarter of 2018 by 10% compared to the same period of last year, to €2,054 million.

In constant euros (i.e. excluding the impact of currency movements), attributable profit grew 22%, with the focus on customer loyalty resulting in further improvements in the quality and recurrence of the Group’s earnings. Since Q1 2017 the Group has increased total loyal customers (people who see Santander as their main bank) by 3.3 million to 18.8 million.

Gross Income in the first quarter increased by 11% in constant euros to €12,151 million with net interest income and fee income increasing by 11% and 14% respectively. Lending and customer funds increased by 13% and 16% respectively in constant euros.

Operating expenses increased by 13% in constant euros as the Group continued to invest in its commercial and digital transformation, however, the cost-to-income ratio, a key measure of efficiency, remained among the lowest of our peer group at 47.4% (compared to a global peer average of over 65%).

The number of customers using digital services increased by 24% since Q1 2017 to 27.3 million, with the ongoing investment in technology driving an increase in digital service adoption.

A balanced presence across both mature and emerging markets remains one of Banco Santander’s key strengths, with attributable profit increasing in eight of the Group’s ten core markets. During the first quarter of 2018, Europe contributed 51% of Group profit and the Americas, 49%. The lending book also remains well diversified across business segments and geographies.

Corporate Communications		2
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

Santander strengthened its capital further during the quarter, increasing its fully loaded CET1 ratio by 16 basis points to 11% of which 9 bps were generated organically.    

The Group non-performing loan ratio reduced further during the quarter to 4.02%, down 135 basis points since the integration of Popular in June 2017. Cost of credit has fallen to 1.04%, down 13 basis points since Q1 2017.

In the first quarter, Santander completed its agreement with Blackstone to transfer 51% of Popular’s real estate portfolio. Following this transaction, the Group’s net Spanish real estate exposure now stands at €5.2 billion.

Over the last 12 months return on tangible equity, a key measure of profitability, has increased by 29 basis points on a like-for like basis to 12.4%, among the best of our peers.

Tangible net asset value per share was seven basis points lower than Q1 2017 at €4.12 due to the impact of IFRS 9. Excluding this impact it increased to €4.20.    

Earnings per share (EPS) remained flat compared to Q1 2017 at €0.120 due to the impact of the capital increase carried out for the acquisition of Banco Popular. The Group maintains its target of achieving double digit EPS growth in 2018.

At the Group AGM on 23 March 2018 the Bank announced its intention to increase the dividend paid from 2018 profits by 4.5% to 23 cents per share and pay the 2019 dividend entirely in cash.    

Country Summary (Q118 v Q117)

Corporate Communications		3
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

In Brazil attributable profit increased by 7% to €677 million (+27% in constant euros) as the Bank continued to grow loyal customers and improve customer satisfaction. Loans continued to grow faster than market average while the cost of credit improved further (down 49 basis points to 4.35%) due to the resilience of the Bank’s risk models. As a result, RoTE increased during the year to 19.9% from 16.5% at Q1 2017.

In Spain attributable profit increased by 26% to €455 million as the integration of Popular continued to progress on schedule. In March the Bank launched the “1|2|3 Profesional” account, the first joint initiative for Santander and Popular customers. More than 75k accounts have been opened since launch. Costs increased following the incorporation of Popular, however, this was offset by positive trends in commercial revenues and an improvement in the cost of credit.

Santander Consumer Finance increased attributable profit by 3% during the period to €323 million (+4% in constant euros), with new lending increasing in all geographies. Higher net-interest income, combined with strong cost control and historically low NPLs and cost of credit, helped the business maintain best in class profitability, with a RoTE of 16.6%.

In the UK attributable profit fell by 23% to €320 million (-21% in constant euros) as a highly competitive environment placed pressure on revenues, and costs increased due to higher investments in strategic, digital transformation and regulatory projects. Loan loss provisions increased due to single provisions for clients in Global Corporate Banking, however, overall credit quality remained good, with the NPL ratio falling by 14 basis points to 1.17%.

In Mexico attributable profit increased by 7% to €175 million (+14% in constant euros) as the Bank added a further 400,000 loyal customers since Q1 2017. Significant investment in multichannel, digitalisation and commercial initiatives helped drive strong growth in both net interest income and fee income. This, combined with strong credit quality, resulted in an increase in RoTE of 83 basis points to 19.6%.

In Chile attributable profit increased by 2% to €151 million (+8% in constant euros) as a focus on customer satisfaction, loyalty and digital initiatives helped drive good growth in revenues. Loan and fund growth accelerated during the quarter, while cost of credit reduced by 20 basis points from March 2017 to 1.22%.

In Portugal, attributable profit increased by 1% to €127 million with profit growth impacted by a higher tax rate and lower portfolio sales than in Q1 2017. Profit before tax increased by 10% as the ongoing digital transformation enabled an increase in customer loyalty and commercial revenues.    

In the US, attributable profit increased by 32% to €125 million (+52% in constant euros) with strong growth in Santander Consumer USA and Santander Bank. Santander Bank saw an increase in profitability due to further improvements in both the net interest margin and efficiency. Santander Consumer USA saw improvements to its cost of credit and reduced costs.    

In Argentina strong growth in gross income (+35% in constant euros), driven by an increase in volumes and higher fee income, was offset by an increase in costs relating to the Citibank acquisition, leading to a fall in attributable profit of 39% to €66 million (-11% in constant euros). Santander is now the leading privately owned bank in Argentina by both loans and deposits.    

Corporate Communications		4
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

In Poland attributable profit increased by 6% to €63 million (+3% in constant euros) after lending increased across all key products and segments. The deposit base also increased with significant growth in demand. Profit was impacted by a change in the timing of the resolution fund payment to Q1 and lower trading gains.

About Banco Santander    

Banco Santander is the largest bank in the Eurozone with a market capitalisation of €85,441 million at 31 March 2018. It has a strong and focused presence in 10 core markets across Europe and the Americas with more than 4 million shareholders and 200,000 employees serving 139 million customers.

Corporate Communications		5
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

GRUPO SANTANDER. KEY CONSOLIDATED DATA

Note: The financial information in this report was approved by the Board of Directors, following a favourable report from the Audit Committee

Corporate Communications		6
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

Important Information:

In addition to the financial information prepared under International Financial Reporting Standards (“IFRS”), this press release includes certain alternative performance measures (“APMs”) as defined in the Guidelines on Alternative Performance Measures issued by the European Securities and Markets Authority on 5 October 2015 (ESMA/2015/1415es) as well as non-IFRS measures (“Non-IFRS Measures”). The APMs and Non-IFRS Measures are performance measures that have been calculated using the financial information from the Santander Group but that are not defined or detailed in the applicable financial information framework and therefore have neither been audited nor are capable of being completely audited. These APMs and Non-IFRS Measures are been used to allow for a better understanding of the financial performance of the Santander Group but should be considered only as additional information and in no case as a replacement of the financial information prepared under IFRS. Moreover, the way the Santander Group defines and calculates these APMs and Non-IFRS Measures may differ to the way these are calculated by other companies that use similar measures, and therefore they may not be comparable. For further details of the APMs and Non-IFRS Measures used, including its definition or a reconciliation between any applicable management indicators and the financial data presented in the consolidated financial statements prepared under IFRS, please see 2018 1Q Financial Report, published as Relevant Fact on 24 April 2018, Section 26 of the Documento de Registro de Acciones for Banco Santander, S.A. (“Santander”) filed with the Spanish Securities Exchange Commission (the “CNMV”) on July 4, 2017 (the “Share Registration Document”) and Item 3A of the Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission of the United States of America (the “SEC”) on March 31, 2018 (the “Form 20-F”). These documents are available on Santander website (www.bancosantander.com).

The businesses included in each of our geographic segments and the accounting principles under which their results are presented here may differ from the included businesses and local applicable accounting principles of our public subsidiaries in such geographies. Accordingly, the results of operations and trends shown for our geographic segments may differ materially from those of such subsidiaries.

Santander cautions that this press release contains statements that constitute “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expect”, “project”, “anticipate”, “should”, “intend”, “probability”, “risk”, “VaR”, “RORAC”, “RoRWA”, “TNAV”, “target”, “goal”, “objective”, “estimate”, “future” and similar expressions. These forward-looking statements are found in various places throughout this press release and include, without limitation, statements concerning our future business development and economic performance and our shareholder remuneration policy. While these forward-looking statements represent our judgment and future expectations concerning the development of our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: (1) general market, macro-economic, industry, governmental and regulatory trends; (2) movements in local and international securities markets, currency exchange rates and interest rates; (3) competitive pressures; (4) technological developments; and (5) changes in the financial position or credit worthiness of our customers, obligors and counterparties. Numerous factors, including those reflected in the Form 20-F –under “Key Information-Risk Factors”- and in the Share Registration Document –under “Factores de Riesgo”- could affect the future results of Santander and could result in other results deviating materially from those anticipated in the forward-looking statements. Other unknown or unpredictable factors could cause actual results to differ materially from those in the forward-looking statements.

Forward-looking statements speak only as of the date of this press release and are based on the knowledge, information available and views taken on such date; such knowledge, information and views may change at any time. Santander does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise

The information contained in this press release is subject to, and must be read in conjunction with, all other publicly available information, including, where relevant any fuller disclosure document published by Santander. Any person at any time acquiring securities must do so only on the basis of such person’s own judgment as to the merits or the suitability of the securities for its purpose and only on such information as is contained in such public information having taken all such professional or other advice as it considers necessary or appropriate in the circumstances and not in reliance on the information contained in the press release. No investment activity should be undertaken only on the basis of the information contained in this press release. In making this press release available, Santander gives no advice and makes no recommendation to buy, sell or otherwise deal in shares in Santander or in any other securities or investments whatsoever.

Neither this press release nor any of the information contained therein constitutes an offer to sell or the solicitation of an offer to buy any securities. No offering of securities shall be made in the United States except pursuant to registration under the U.S. Securities Act of 1933, as amended, or an exemption therefrom. Nothing contained in this press release is intended to constitute an invitation or inducement to engage in investment activity for the purposes of the prohibition on financial promotion in the U.K. Financial Services and Markets Act 2000.

Statements as to historical performance or financial accretion are not intended to mean that future performance, share price or future earnings (including earnings per share) for any period will necessarily match or exceed those of any prior year. Nothing in this press release should be construed as a profit forecast.

Corporate Communications		7
Ciudad Grupo Santander, edificio Arrecife, planta 2
28660 Boadilla del Monte (Madrid) Tel. +34 91 2895211
[email protected]
www.santander.com - Twitter: @bancosantander

Table of Contents

Item 2

Financial Report 2018
January - march

Table of Contents

January – March 2018 FINANCIAL REPORT 3 Key consolidated data 4 Santander aim 6 Group performance 9 General background 10 Income statement and balance sheet 17 Solvency ratios 18 Risk management 21 Business information 38 Corporate Governance 39 Sustainability 40 The Santander share 41 Financial information. Appendix 59 Alternative performance measures All customers. shareholders and the general public can use Santander’s official social network channels in all the countries in which the Bank operates,

Table of Contents

GRUPO SANTANDER. KEY CONSOLIDATED DATA

(*) Excluding net capital gains and provisions.

(**) Q1’17 data adjusted for the capital increase in July 2017, for like-on-like comparisons with Q4’17 and Q1’18 data.

Note: The financial information in this report was approved by the Board of Directors, following a favourable report from the Audit Committee

Financial Report 2018         3

Table of Contents

SANTANDER AIM

Simple Personal Fair “Helping people and businesses prosper” 81%* 77%* 18.8 (+22%**) 27.3(+24%**) of employees engaged million loyal million digital perceive that employees customers customers their colleagues behave in a more Simple, Personal and Fair way ... m ake o n d sa ur a … ti c e d s s us t e e ed t a y o People i v l o an m t p d e Customers o l r m m o s e e y a r e d l m 201,900 o . . o 139 a g . r e M million n g e . . . d r e a n s u l t t y h i l i n i t i g b w n i n t a r o t h h i og Communities* e g r e Shareholders h p l c er g b o i n i n a m ve r i v i n mu st .d s t a 2.1 nit ment . . s u 4.1 million people y million helped in 2017 44,862* 1,295* 11.00% +11% scholarships agreements with Fully loaded cash dividend granted universities CET1 ratio per share in 2017 and academic institutions growth in 2017 in 21 countries (*) 2017 data (**) % YoY

4         Financial Report 2018

Table of Contents

SANTANDER AIM

Simple Personal Fair Plans were designed to maximise our strengths and improve the opportunities identified in the latest global engagement survey. MyContribution, the performance management model for driving transformation, continued. The first phase was carried out in January, setting the individualised priorities. A collaboration agreement was signed between Santander and Workday in order to put into effect a common Human Resources platform throughout the Group. This will enable enhanced management of the talent pool at the global level and of our professionals in a more Simple, Personal and Fair way. The Leaders Academy Experience was launched. This is a training experience to help leaders play their role in the Bank’s transformation, speed up change and be an example in this new phase. Various strategies continued to be developed under the commercial transformation programme in order to improve customer loyalty and experience. The number of loyal customers rose by 3.3 million and digital ones by 5.2 million. Of note among the commercial actions implemented in the first quarter were the launch of the 1|2|3 Profesional in Spain (the first joint offer from Santander and Popular) and of the Trusted Profile for SMEs in Poland, which enables companies to manage incidents with public administrations remotely. As regards the digital transformation, we launched Santander One Pay FX, making Santander the first bank to offer blockchain-based international payment services to retail customers in several countries. Cockpit, an innovative auto finance platform, in Brazil; CrediSimples, the app for contracting funds and retirement savings plans, in Portugal; and Online Banking individuos in Argentina. In payments via mobile phone, we launched Garmin Pay in Poland, which enables payments to be made using a smartwatch connected to a MasterCard card and Súper Movil in Mexico, a sales channel for pre-approved loans. Santander Spain is the only bank in the country that incorporates all cards in Apple Pay for all segments. The AGM was held, with the participation of more than 660,000 shareholders and a quorum of 64.55% of the share capital, the highest in the Bank’s recent history. Shareholders once again confirmed their confidence in the board, approving 98% of the agreements proposed. The prestigious financial publication, Institutional Investor, in its latest 2018 The All-Europe Executive Team annual ranking, rated Santander’s CEO and CFO as one of the Top 3 in their respective categories (Best CEOs and Best CFOs). Our corporate website and the Analyst Days held in 2017 were rated the second best in Europe. Banco Santander renewed its presence in the Dow Jones Sustainability Index (DJSI), where it has been since 2000 continuously. The Bloomberg Gender-Equality Index ranked Santander as one of the leaders in diversity. A total of EUR 183 million was invested in communities in 2017, with 2.1 million people helped and more than 44,000 scholarships granted. Santander reaffirmed its commitment to universities at the first European summit on education. Furthermore, it also renewed its cooperation with the Fundación General CSIC and assigned EUR 1.5 million to research and innovation projects and a new edition of the W30 and W50 leadership training programmes for female managers, university students and entrepreneurs.

Financial Report 2018         5

Table of Contents

GROUP PERFORMANCE

6         Financial Report 2018

Table of Contents

GROUP PERFORMANCE

Financial Report 2018         7

Table of Contents

MAIN BUSINESS AREAS PERFORMANCE

(Greater detail on pages 21 to 37 and in the appendix)

(Changes in constant euros)

 

		• Continental Europe recorded an attributable profit of EUR 931 million, 21% more year-on-year. Growth was largely due to the increase in commercial revenue and also benefited from Banco Popular’s integration and the greater stake in Santander Asset Management.

All units generated higher profits.

Continental Europe’s profit was 14% higher than in the fourth quarter, due to higher revenue and lower costs.

 

•

United Kingdom: in an environment of some uncertainty arising from Brexit and tough competition, attributable profit was 21% lower year-on-year at EUR 320 million. This was due to pressure on spreads, investments in regulatory and strategic projects, and increased provisions over a first quarter of 2017 with a cost of credit of almost zero.

The first quarter profit was 7% higher than the fourth quarter of 2017. The pressure on spreads on loans and on the SVR (Standard Variable Rate) balances was offset by lower provisions and higher gains on financial transactions.

 

•  Latin America: profit of EUR 1,099 million, 23% higher year-on-year. Growth was underpinned by the good performance of net interest income and fee income, reflecting the rise in volumes, higher spreads and greater loyalty.

Operating expenses grew mainly because of investment plans in Mexico and the expansion and transformation of the retail network in Argentina, partly because of the incorporation of Citibank’s retail network. The rise in provisions was largely due to higher lending volumes and some single cases in GCB.

Profit was 3% higher than in the fourth quarter, despite being affected by some seasonal factors. Of note was the good performance of net interest income, fee income and costs.

 

•	United States: Profit of EUR 125 million, 52% more year-on-year, largely due to higher gains on financial transactions, lower provisions and cost control, which offset the decline in gross income from lower volumes and spreads, and reduced fee income from servicing.

The first quarter profit was also higher than the fourth quarter of 2017, thanks to the good performance of all P&L lines: gross income increased, and costs and provisions declined.

8         Financial Report 2018

Table of Contents

GENERAL BACKGROUND

Grupo Santander developed its business in an economic environment that continued to strengthen. Global growth is expected to be close to 4% in 2018, higher than in recent years. The mature economies where the Bank operates are more upbeat, particularly the Eurozone and the United States, while among developing economies the recovery in Brazil and Argentina is consolidating and Mexico is stronger.

US and Mexican interest rates rose in the first quarter, while Brazil’s continued to fall. The rest of central banks held their benchmark rates flat.

Lastly, the euro strengthened in the first quarter against the currencies of most countries where the Group operates.

(*) Year-on-year change 2017

Financial Report 2018         9

Table of Contents

GRUPO SANTANDER RESULTS

10         Financial Report 2018

Table of Contents

(*) Including :

(**) Data adjusted to capital increase of July 2017.

Financial Report 2018         11

Table of Contents

First quarter results compared to the fourth quarter of 2017

The Group’s first quarter attributable profit of EUR 2,054 million was 33% higher than the fourth quarter, a period affected by non-recurring items amounting to EUR 382 million negative net of taxes, mainly amortisation of SC USA’s goodwill and the capital gain of Allfunds.

Eliminating these effects, growth was 7% (10% excluding the exchange rate impact). Growth was due to:

Evolution of results over the first quarter of 2017

Attributable profit rose 10% year-on-year and 22% excluding the exchange rate impact. The P&L performance by line was as follows (all changes exclude the exchange rate impact).

Gross income

All units increased except for the United Kingdom, affected by pressure on spreads on new lending and standard variable rate (SVR) balances, and the US, hit by lower balances in the auto finance portfolio and tighter spreads. The decline in revenue was offset by lower provisions.

12         Financial Report 2018

Table of Contents

Operating expenses

Of note by units was the fall in real terms of costs in Portugal and the United States, while those at Santander Consumer Finance, Poland and Chile were basically flat. The main rises were in Mexico, due to investments in infrastructure; in Argentina, because of Citibank’s integration, the review of the salary agreement and investments in transformation and technology; and in the UK due to investments in regulatory, strategic and digital transformation projects.

Costs increased slightly in Brazil (due to business growth). In Spain they rose YoY, but declined versus the fourth quarter, showing the first fruits of the optimisation plan.

In short, we are keeping our focus on operational excellence in order to remain a reference in the sector in terms of efficiency, while we continued to enhance the customer experience.

Loan-loss provisions