Presentation debt sales event Berlin Nov 2015

Benelux

Santander Consumer Finance Benelux B.V.The NetherlandsWinthontlaan 1713526 KV Utrecht

Smit NovakAnnual international conferenceCollections Debt SalesBerlin, 26/27 November 2015

The pre-sale decision making process

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Banco Santander S.A. and Santander Consumer Finance Benelux B.V. advise that this presentation contains representations regarding forecasts and estimates. Said forecasts and estimates are included in several sections of this document and they include, among others, remarks on the development of future business and future returns. Although these forecasts and estimates represent our opinions regarding future business expectations, perhaps certain risks, uncertainties and other relevant factors may lead the earnings to be materially different from what is expected. Included among these factors are (1) the situation of the market, macroeconomic factors, regulatory and government guidelines, (2) variations in domestic and international stock exchanges, exchange rates and interest rates, (3) competitive pressure, (4) technology developments, (5) changes in the financial position and credit standing of our customers, debtors or counterparts. The risk factors and other fundamental factors that we have stated could have an adverse effect on our business and on the performance and earnings described and contained in our past reports, or in those that we shall present in the future, including those filed with regulatory and supervisory entities, including the Securities Exchange Commission of the United States of America.

N.B.: The information contained in this publication has not been audited. However, the preparation of the consolidated accounts has been established on the basis of generally accepted accounting principles and criteria.

Disclaimer

Introduction – Grupo Santander / Consumer

Some market insights


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Agenda

Wrap up and take away

Introducing Santander Group 4

Key figures Santander Group

9M’15 attributable profit 5.1 billionC/I Ratio 47%Assets 1.27 trillionLoans 799 billion Deposits and assets under management 1.1 trillionEmployees 190kBranches c. 13kMarket cap c. 75 billion

Source Investor Day presentations, except attributable profit all figures refer to 1H 2015.

Introducing Santander Consumer Finance 5

Source figures as of June 2015 / internal estimations

Santander Consumer Finance is active in 14 European countries with 14k employees. Critical mass and leadership in auto loans and durables financing. Strong conversion model from indirect to direct customers.

Key figures Benelux

Present in Belgium (Merelbeke) and The Netherlands (Utrecht) with 300 FTE’s

Consumer finance companyAuto finance, Direct and Durables

Some good news to start with… 6

What do the consultants say…

Source: https://www.pwc.co.uk/assets/pdf/investor-insight-survey2015.pdf(public data)


Taken with permission from PwC presentation by Guillermo Barquin on the European NPL market, Madrid – Spain (15.10.2015)



Source: : http://www2.deloitte.com/content/dam/Deloitte/uk/Documents/corporate-finance/deloitte-uk-deleveraging-europe.pdf(public data)


Before going into the details, why do deals fail? 9

What do the consultants say…What do the consultants say…


Before going into the details, why do deals fail? 10

What do the consultants say…What do the consultants say…


Experienced sellers versus first timers 11

…SPA = Sale and Purchase Agreement NDA = Non Discloser Agreement

Main conclusions:

Data quality

Are we making a fundamental error?

Legal stuff (SPA/NDA)

Let’s not forget, it’s a process like any other. 12

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Experienced sellers versus first timers. Managing your internal stakeholders and obtaining their support. Initial analyses and accessing the need for segmentation. Setting internal price expectations. Building the business case and first assumptions.Comparing alternatives, what if scenarios.

The pre-sale decision making process 14

Preparation

Current market circumstances, deals and conditions. Understanding the market and parties.

What are investors looking for? Appetite, any worries? How do I segment the portfolio? Teaser? How do I present the portfolio and deal as to maximize interest?

Impacts of the transaction? Build the P&L. Structure the deal in terms of capital and liquidity.

Documenting the portfolio. How do I reduce the risk for the investor by providing complete

information? Do I have all the information to build a comprehensive data tape? Completeness of files?

Legal investigations. Do I use my own NDA or the buyers one? Planning the Due Diligence. Terms and conditions I would want in the SPA?


Preparation


Decision Prepare Stakeholders

Do your homework, otherwise others will do it for you. (inside-out)

Analyze the case for sale, access strategic options & alternatives.

Treat it as a project (PM/plan/etc.).

Based on your initial expectations – get help?

Work out your what if scenario’s.

Also set non-financial objectives.

Operational impacts and benefits.

Reality check (are expected requirements – DATA – realistic?).

Check to be expected timelines and your available resources.

Determine your baseline / bottom line and stick to it.

Map your internal stakeholders.

Get arguments and facts that appeal to your audience.

Some personal observations 17

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Be careful what you wish for. Your P&L can become addicted to debt sales. One’s you start, it can be difficult to step away.

Double check if all of your internal stakeholders are truly onboard.

Opt for external legal advise. Be careful not to legalize the business discussions.

Stay involved post deal. Work together with your buyer to maximize results.

Mix debt sales with your other collection strategies.

18Questions?

19Appendix - your speaker details

Casper SonnegaHead of Collections Business Unit Benelux

Contact details:

Mobile: +31(0)6 – 10 90 72 23E-mail: [email protected] Website: www.santander.nl

www.linkedin.com/in/caspersonnega

mailto:[email protected]