The collapsed Portuguese bank, Banif, given away to Santander in December 2015, has managed to generate a million euros a month in profit for the Spanish group last year.
Santander acquired Banif's banking activity at the end of 2015 as the Bank of Portugal yet again was panicked into a deal that saw shareholder value wiped out and future losses underwritten.
Santander Totta saw its profits soar 35.8% last year, to a total of €395.5 million euros. The parent company, the Spanish bank Banco Santander, posted a 4% increase over 2015, to €6.2 billion euros.
The Santander Group is the largest in the eurozone by market value. The result of €6.2 billion for 2016 surpassed the expectations of analysts.
The Portuguese government is still embroiled in the notorious ‘swap’ contracts legal dispute between publically owned transport companies and Santander Totta whose president said he has been in talks with the Portuguese government to agree a deal on these contracts and remains hopeful of a positive outcome.
"I'll just say there have been talks. Whether we will have a result or not, it’s still early to say," said Vieira Monteiro said at today’s press conference in Lisbon to present the bank's results.
Monteiro answered questions about whether he hoped for an agreement on 'swaps' contracts sold to public transport companies, similarly to the deal recently achieved in Madeira where the contracts have been restructured and the lengthy court process ended.
Vieira Monteiro stated that "the bank has always wanted to make an agreement on this matter" and told reporters: "I have some hope of getting there, I have been available for six years to make the agreements. Let me keep that hope."
"Making this agreement with Madeira is a good sign and gives us hope that one day we will also reach an agreement with the Portuguese State," added the Santander Totta president.
Currently, Santander is owned €1.8 billion after the State stopped paying the ever-incresing interest payments due on these 'swaps' contracts that became more expensive as interest rates fell
These contracts hit the headlines when in 2013 the public became aware of the open-ended liabilities of the taxpayer-owned transport companies.
Swaps started a political war, leading to the creation of a Parliamentary Committee of Inquiry and the subsequent dismissals of government officials. The already tainted reputation of the finance minister of the day, Maria Luís Albuquerque, suffered further damage.
