Santanders(LSE: BNC) (NYSE: SAN.US) first-quarter results made one thing quite clear: the lender is one of the fastest growing companies around.
Indeed, Santanders first-quarter earnings jumped 32% as profits rose in nine out of the ten markets the lender operates in.
Whats more, Santander surprised many analysts by reporting a 41% net increase in earnings within Brazil, where a sharp economic slowdown has strangled the growth of the banks competitors.
Nevertheless, the stand-out region for Santander was the banks home market, Spain.
Stand-out performance
Santanders Spanish income rose 42% during the first quarter and based on figures released over the past week, this strong performance is set to continue.
The Spanish economy is recovering rapidly and economists now expect the regions GDP to grow by 2.9% during 2015. Figures released this morning show that the countrys economy grew by 0.9% during the first quarter of the year,giving Spain thefastest-growing large economy in theeuro area.
Strong management
One thing that stands out about Santanders results is the lack of fines that have been levied on the group.
Other international lenders have been forced to payout billions in fines and legal costs since the financial crisis. Santander, however, has been able to avoid much of the storm. Clearly, the banks management has been trying to look after its reputation and customer interests.
Still, Santander has undergone a complete management overhaul since the death of itsveteran chairman, last year. Now, the bank is managed by Ana Botn, daughter of the previous chairman, and she has completely reshuffled the lenders management team.
Unfortunately, at the same time MsBotn has cut Santanders dividend payout, although she alsoraised 7.5bn in fresh capital.
These actions seem to be contributing to the banks growth. Thanks to the rights issue, Santandersfully loaded core equity tier 1 ratio financial cushion stood at 9.7% at the end of the first quarter. The bank is targeting a tier 1 capital ratio of 10% by the end of 2015, which is lower than average, but still respectable.
Sign of things to come
Santanders first-quarter results were a sign of things to come at the bank over the next two years. City forecastssuggest that Santanders earnings will expand by 14% during 2015, and a further 12% during 2016.
These figures suggest that the bank is trading at a forward P/E of 12 and 2016 P/E of 10.9. However, considering the fact that Santander actually surprised many analysts by its strong performance during the first quarter of this year, I wouldnt rule out further outperformance.
Santanders shares are set to offer a yield of 3.2% this year followed by 3.4% during 2016.
Management is key
Santanders strong management team has helped the bank become one of the markets hottest growth stocks.
And a revolutionary management team is something that we’re always on the lookout for here at The Motley Fool. And we’ve just identified one company that has the potential todriveathree-fold increase in salesin just five years thanks to its forward thinking CEO.
We believethat this is one of the market’s hidden gems
To find out more, simply readthe team’s newFREEreport,”3 Hidden Factors Behind This Daring E-commerce Play“. This issomethingyou do not want to miss and we’re offering you the chance to find out more for free right now — justclick here.
Rupert Hargreaves has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.