HispanicBusiness

Santander saw annual net profits plunge by 59 per cent to 2.2 billion euros (3 billion dollars) in 2012, Spain's largest bank said Thursday.

Santander said the drop was the result of having set aside 18.8 billion euros for bad loans and potential property losses in order to meet the government's provisioning requirements.

The share of bad loans at Santander's Spanish branches rose to 6.7 per cent, from 5.5 per cent in 2011.

Santander chairman Emilio Botin said the bank's results would improve in 2013, "with the exceptional write-offs behind us."

Botin said diversification remained a key to growth.

Half of Santander's 2012 profits came from Latin America, despite profits from that region dropping by nearly 8 per cent, due in part to weaker results in Brazil and Chile.

The eurozone has granted more than 40 billion euros in aid for the Spanish banking sector, which was left burdened with toxic assets after the collapse of the country's property sector during the global crisis. Santander is not among banks receiving aid.