Santander UK has warned of further cost-cutting over the year ahead, despite a hike in annual profits. The Spanish-owned lending giant reported a 14% rise in pre-tax profits to £1.51 billion for 2025.
The increase comes even with the additional provision for motor finance compensation and costs, on top of £295 million for the saga in 2024, having earlier cancelled third-quarter results to assess the impact of the Financial Conduct Authority’s redress scheme. But the bank cautioned, « there continue to be significant uncertainties as to the nature, extent and timing of redress payments ». It added: « The ultimate financial impact could be materially higher or lower than the amount provided. »
In full-year results, it also set the scene for more cost-cutting in 2026, less than a week after it revealed plans to shut another 44 branches, putting nearly 300 jobs at risk.
Santander said it expects further cost efficiencies in 2026, « driven by simplification and automation of our business ».
It said it expects to complete the £2.65 billion TSB deal in the first half of 2026.
The UK bank results came after its Spanish owner, Banco Santander, announced a 12.2 billion US dollar (£8.9 billion) deal to buy American rival Webster Bank.
Banco Santander reported a better-than-expected net income of 3.76 billion euros (£3.24 billion) for the fourth quarter, having brought the results forward by a day due to the announcement of the deal.
