Santander breaks silence over 'pulling out of UK' with millions of customers at risk

Santander has broken its silence over claims it is considering pulling out of the UK market. A major high street bank is considering pulling out of the UK - leaving 14 million customers in limbo, according to reports in the Financial Times.

The potential move is part of a strategic review, driven by frustration over regulatory constraints. The Spanish banking giant is exploring several strategic options, including a complete exit from Britain, the FT reported on January 19.

Sources familiar with the matter indicated the review is at an early stage, with no imminent deal or announcement expected.The bank is reportedly examining the exit as it seeks to focus on regions with higher growth potential.

READ MORE Met Office warns over 'powerful' weather shift and issues exact date it starts

A former Santander executive has warned that a UK exit has "always been a possibility," particularly under the leadership of executive chair Ana Botín. But a statement from Santander said: "The UK is a core market for Santander, and this has not changed."

It comes afer Santander put aside £295 million to cover potential payouts to car loan customers as the bank issued its first estimate of the financial fallout from the growing car loan mis-selling scandal, which has affected swathes of drivers, motorists and road users.

The figures were released alongside the bank’s third-quarter results, which were delayed after a court of appeal ruling said it was unlawful for two lenders to have paid a “secret” commission to car dealers without borrowers’ knowledge.

The provision dented the bank’s pre-tax profits, which fell to £143 million in the quarter, down from £413 million in the second quarter. Analysts at RBC had previously estimated that the FCA investigation and court judgment could together end up costing Santander up to £1.4 billion.

The company said: “Increased income from active price management, and a steadily improving economic environment were offset by a provision relating to historical motor finance commission payments.”