Lifts ROTE target to between 1517 in 20232025 period
Raises payout in threeyear strategy to 50 from 40
Bank aims to add 40 million new customers by 2025
Sees NII growing a CAGR between 6 and 7 between 20222025
Sees efficiency ratio of 42, cost of risk of 100 to 110 bps

MADRID, Feb 28 Reuters Spain39;s Santander said it plans to return half its profits to shareholders as it announced ambitious profitability targets for the next three years, betting on customer growth and higher interest rates in Europe to boost revenue.

Santander has relied in the past on Latin America to cope with tough conditions for lenders in Europe since the financial crisis but banks across Europe are beginning to benefit from higher borrowing costs despite economic uncertainty.

We do have tailwinds for the first time in eight years, we are running a business in Europe where we are not charging deposits and not giving loans close to zero, Santander Chairperson Ana Botin told investors at the bank39;s 20232025 strategy update in London.

Its shares rose almost 5 by 1250 GMT on news of the planned payouts and after the bank also said it aimed to achieve a return on tangible equity ROTE of 1517 between 2023 and 2025, compared with 13.4 in 2022.

While the payout target increased to 50 from current 40, in line with consensus but below our expectations, we flag the bank39;s significantly higher revenue growth ambitions and profitability targets which could offer absolute shareholder…