2022 Annual Review

Executive Chair’s Letter

01Executive Chair’s Letter

Executive Chair’s Letter

Ana Botín

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Chief Executive Officer’s Letter

02Chief Executive Officer’s Letter

Chief Executive Officer’s Letter

José Antonio Álvarez

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Santander in 2022

03Santander in 2022

Santander in 2022

Santander Today

2022 Results

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Santander tomorrow

04Santander tomorrow

Santander tomorrow

Strategy and targets

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DataHub

05DataHub

DataHub

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About us

Business Areas

Group's key data

Santander Today

About us

Santander is a commercial bank, founded in 1857 and headquartered in Spain. We have a meaningful presence in 10 core markets in Europe, North America and South America.

We are one of the largest banks in the world by market capitalization, listed in stock exchanges of Spain, Mexico, Poland, the United States, and the United Kingdom.

We provide service through our 9,019 branches and online channels that offer banking products, operations and services to individuals, SMEs, and corporates.

We have 160 million customers, 206,462 employees and close to 4 million shareholders around the world.

As a responsible bank, we focus on areas where our activity can have the greatest impact and support an inclusive and sustainable growth.

an engaged talented team

generates

customer loyalty

leading to

strong financial results for our shareholders

so we deliver

support for our communities

which motivates

We create value for all

Our purpose

To help people and businesses prosper

Our aim

To be the best open financial services platform by acting responsibly and earning the lasting loyalty of our people, customers, shareholders and communities

Our how

Everything we do should be simple

Everything we do should be

Corporate behaviours

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Think
customer

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We care about our customers, so we go the extra mile to earn their trust and loyalty

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Embrace
change

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We embrace new challenges, and we see new ways of doing things as an opportunity to grow

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Act
now

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We take accountability and manage risks, accordingly, always keeping things simple

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Move
together

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We seek opportunities to promote collaboration and work together to achieve common goals

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Speak
up

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We feel free to raise any idea, ask any question or escalate any issues or risks, building an environment of respect and trust

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Corporate core strenghts of our corporate governance

Broad and balanced shareholder base

Shareholders

3,915,381

3,915,388

Share capital distribution by type of shareholder

Share capital distribution by geographic regions

*Shares owned or represented by directors.

30/12/2022. Source: Banco Santander, S.A. Shareholder Register.

Effective, balanced and diverse board of directors

Robust structure of area-specific committees to advise the board

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Balanced composition of board and committees

Board

13.33%

66.67%

20%

Remuneration committee

80%

20%

Executive committee

28.57%

42.86%

28.57%

Nomination committee

100%

Risk supervision, regulation and compliance committee

80%

20%

Innovation and technology committee

25%

62.5%

12.5%

Audit committee

100%

Responsible banking, sustainability and culture committee

100%

Executive

Independents

Other external

Effective engagement with our shareholders

Annual General Meeting quorum

0.0

65.0

0.0

60.3

0.0

67.7

0.0

68.8

April 2020

October 2020

2021

2022

Focus on responsible business practices and attention to all stakeholders' interest

A proactive risk and compliance management

Santander's key types of risk

How we manage risks in Santander

A solid risk culture

Santander's key types of risk

Credit risk

Risk of potential loss assumed by Grupo Santander resulting from the failure of our counterparties to meet their contractual obligations.

Market risk

The risk that arises as a consequence of changes in market factors, such as interest or exchange rates, equities and commodities, among others, which can affect profits or capital.

Liquidity risk

The risk of insufficient liquid financial resources to meet our obligations when they fall due, or too costly to obtain.

Structural risk

The risk of changes in the value or margin generation of the assets or liabilities in the banking book resulting from changes in market factors and balance sheet behaviour. It covers insurance and pension risks as well as the risk that Grupo Santander will not have sufficient capital to meet internal business targets, regulatory requirements or market expectations.

Strategic risk

Risk of loss or damage arising from strategic decisions or their poor implementation, that impact the medium and long term interests of our key stakeholders, or from an inability to adapt to external developments.

Operational risk

The risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. It includes legal, regulatory compliance and conduct risks.

Financial crime risk

Risk arising from actions or the use of the Group's means, products and services in criminal or illegal activities. These activities include, among others, money laundering, terrorist financing, violation of international sanctions programs, corruption, bribes and tax evasion.

Model risk

Risk of loss arising from inaccurate forecasting that can result in poor decision-making, or models inappropriately implemented or used.

Reputational risk

Risk of actual or potential losses due to the bank's reputation among employees, customers, shareholders, investors and broader society.

Common Risk Principles aligned with regulatory requirements and inspired by best market practices

All Grupo Santander employees
are risk managers.

Involvement of senior managers through their conduct, actions and communications.

Our organisational structure ensures
sufficient independence between the risk management and control functions.

A forward-looking, comprehensive
approach to risk management and control for all businesses and risk types.

Complete and timely information to
identify, assess, manage and disclose risks to the appropriate level.

3 lines of defence model with a clear assignment of responsibilities

1 .

Formed by businesses and functions that take or originate exposure to risk.

2 .

Formed by the risk and compliance and conduct functions, it independently oversees and challenges the first line's risk management.

3 .

The internal audit is independent of any other function or unit. Its goal is to provide the board of directors and senior managers with high-quality and efficient controls, governance, and risk management systems.

Clearly defined management and control processes

Planning

Is the process of setting business objectives considering the levels of risk that ths business is willing and able to accept.

Assesment

To determine likelihood, impact and
materiality of risks.

Monitoring

An essential business-as-usual activity to detect any deviation from our plan.

Mitigation

If performance deviations are detected, mitigation actions are considered to bring performance back within acceptable levels.

Identification

Risk identification is a key component of effective risk management and control.

Decision making & execution

Decision are required to manage the business's risk profile within the limits agreed.

Reporting

The risk reporting process includes the production and submission of accurate and relevant management information.

What is it?

It is a pillar of Grupo Santander's culture, The Santander Way, and an essential lever in the Group's mission to contribute to the progress of people and businesses.

Risk Pro represents, above all, individual responsibility for the risks we assume and our contribution to the identification, assessment and management of all risks in an appropriate and professional manner. All risks, anytime, anywhere, by each and every one of us.

Responsible banking

3 main priorities as a responsible bank:

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Main markets

Europe

Spain

Portugal

Poland

North America

Mexico

South America

Brazil

Chile

Argentina

Others

Uruguay

Peru

Colombia

Digital Consumer Bank

Santander Consumer Finance
(Consumer / Auto business )

Openbank

Global businesses and platforms

Corporate & Investment Banking

We support companies and institutions with tailor-made services and value-added products taking into account their level of complexity and sophistication.

Wealth Management & Insurance

We combine the private banking, asset management and insurance businesses to offer our clients investment and hedging solutions that best suit their real needs.

Payments

Simple and accessible digital payment solutions

PagoNxt

Cards & Digital Solutions

Group's key data

02. Chief Executive Officer's Letter

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03. Santander in 2022 | 2022 Results