Santander profits grow 13% but outlook unsure
The boss of Santander UK has cautioned over a "more challenging" 2017 after profits rose 13% last year despite a sharp slowdown in customer growth for its flagship current account.
Chief executive Nathan Bostock said the year ahead would be "changeable" as the group warned over a slowdown in corporate lending and more borrowers falling behind with repayments amid the fallout from Brexit.
Santander posted underlying pre-tax profits of £2.03bn for 2016, up from £1.79bn the previous year.
But Spanish owner Banco Santander saw the weak pound knock profits from its UK operation, leaving its British earnings 14.7% lower last year when translated into euros.
Santander UK revealed a marked slowdown in the number of new customers signing up to its popular 123 current account after it raised the monthly fee in January 2016 and halved the interest rate in November.
It added another 483,000 123 customers in 2016, down from around one million in 2015.
Santander said its UK arm also put by another £114m in the fourth quarter of 2016 for the payment protection insurance (PPI) mis-selling scandal.
Mr Bostock hailed a "strong performance" in 2016.