Santander has reported a 37% drop in UK pre-tax profits for 2019 as a PPI bill and restucturing costs proved a drag for the bank.
Profits were down to £981m, with £169m wiped off to compensate PPI customers along with a further £155m restructuring bill.
That restructuring saw Santander close 140 branches in the UK last year, leaving it with 616 remaining branches.
Nathan Bostock, UK chief executive at Santander, said: “Our 2019 results were impacted by the ongoing competitive income pressure on mortgages and PPI charges but they also include the investment we are making as part of our plan to transform the bank for the future.
“The environment for the banking sector remains challenging, with ongoing competitive pressures and a demanding regulatory agenda.”
On the mortgage front Santander reported more success. Overall mortgage lending in 2019 increased by £7.4bn to £165.4bn.
Home movers accounted for the majority of the bank’s business making up 44% of borrowing. They were followed by remortgagers (32%), first-time buyers (19%) and buy-to-let borrowers (5%).
Bostock added: “We have continued to support our customers and I am pleased that we delivered our strongest net mortgage growth in a decade, reinforcing our position as the UK’s third largest mortgage lender.”
The Santander boss also took the opportunity the express his thoughts on the upcoming interest rate decision from the Bank of England.
There have been indications from some of the Monetary Policy Committee that a cut could be on the cards. However this noise has died down in recent weeks.
Bostock told the London Evening Standard that whilst the BoE may have data he doesn’t it should sit tight for now.
“The logical thing would be to remain flat,” he told the Standard.
The BoE will announce its decision on interest rates later today.