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James Ashton: Santander UK leaves the pain in Spain

James Ashton
Monday 20 August 2012 21:21 BST
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Outlook Some of Spain's biggest companies have gone to great lengths to distance themselves from the debt-laden country.

Santander UK boss Ana Botin, whose father chairs the parent company back home, declared in a recent interview that "we are the most British of the British banks".

Her point is that Santander UK is ring-fenced from Spain, meaning Ms Botin couldn't send money back to Madrid even if she wanted to.

Santander is one of a handful of large Spanish corporates which went rampaging around the world when times were better than they are now. But it has been clever enough to spin off assets to raise funds along the way.

As Spain inches towards a bailout from Europe, other firms might not be so fortunate.

Telefonica, owner of the O2 mobile network in Britain, faces a stark choice according to analysts at Bernstein Research. The company, which relies on Spain for a third of its profits has already axed its dividend and is selling off assets. Better to opt for a €10bn (£6.3bn) rights issue, Bernstein believes. Ouch.

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