Banco Santiago, S.A. (SAN)

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Banco Santander Santiago (SAN), previously known as Banco Santander-Chile, is the largest private bank in Chile (total assets of Ch$14,843 billion or US$27.8 billion at yearend 2006) and is 77% owned by Banco Santander Central Hispano, the largest bank in Spain. The company, formed by the 2002 merger between the former Banco Santander-Chile and Banco Santiago, offers both corporate and retail banking to its client base, and has roughly a 22% market share in loans and deposits. The bank provides a full range of financial services to corporate and individual customers through two major business units: Retail Banking and Wholesale Banking. Banco Santander Santiago offers Chilean peso and foreign currency-denominated loans (which finance a variety of commercial transactions), trade financing, foreign currency forward contracts, credit lines, and retail banking services, such as mortgage financing. In addition to its traditional banking operations, Santander extends a range of financial services, including financial leasing, financial advisory services, mutual fund management, securities brokerage, insurance brokerage, and investment management. The bank's clientele varies from large corporations to lower middle-class individuals.

In 2006, 78% of net revenue (total revenue less interest expense) of Ch$790 million (US$1.5 billion) was generated from interest-bearing sources, while the remaining 22% of net revenue came from fee-based and other non-interest sources. Santander, the largest bank in Chile in terms of total deposits and loans, also boasts of the largest distribution network in the country with 397 branches and 1,588 ATMs at yearend 2006. As of December 31, 2006, Santander's total asset base stood at Ch$14,843 billion (US$27.8 billion), total deposits at Ch$9,392 billion (US$17.6 billion), loans outstanding net of reserves at Ch$11,615 billion (US$21.7 billion), and shareholders equity at Ch$1,245 billion (US$2.3 billion). Santander is the highest credit-rated Latin American bank. Currently, Santander s credit ratings are A by Standard & Poor's, A by Fitch, and Aa3 by Moody's (recently upgraded from A2 following a change in rating methodology).

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