Good morning, ladies and gentlemen, shareholders. We're going to begin the general meeting of Santander Bank in accordance with the law and our company bylaws. The official notice of the call to the meeting was published on March 4, 2019, on the webpage of the CNMV, on the company registered official gazette and in the webpage of Santander corporate page. It's also it was also published in the dailies, Aleta and El Gallio Montanez. Notice to the call this meeting was provided to the attendees when coming into the meeting and is available to you in the shareholders' office and at the NORDERRI's desk.
I must also inform the shareholders that the minutes of this meeting will be drawn up by a notary. For that, we have with us notary Juan Didios Valenzuela Garcia, whom I'd like to introduce to the shareholders. Mr. Notary, could you please stand up? I give the floor to the secretary to report on the number of attending shareholders in this meeting that have the right to vote.
The share capital with voting rights is EUR 8,118,286 €1,971 represented by 16,236,573,942 shares with a face value of €0.50 each. The necessary quarter for to duly convene the meeting on second call is 25%, which is equivalent to a subscribed voting capital of EUR 2029,573,743 represented by 4,059,143,486 shares. In this meeting, we have a total of 758,299 shareholders, all of them with the right to vote. And out of these, 93,465 are in prison and 664,854 are in proxy, holding a total of 11,000,000,000 112,000,000,186,000 shares, out of which, 518,000,000,000, 880 8553 shares. In other words, 3.196 percent of the share capital correspond to attending shareholders and 10,000 63.10 percent of the share capital correspond to represented shareholders.
Therefore, in this meeting, we have shareholders that possess 8.505 percent of the shares entitled to vote. Out of the present shareholders, 92,166 Shareholders holding 394,213,543 shares that represent 2.28 And of the share capital, our remote voters, they voted before the meeting. And out of these, 303,566 shares have after vote by delivery or mail, 18,000 shareholders who hold 92,276,806 shares have cast their vote electronically. Likewise, among the present shareholders, a total of 28 shareholders holding 420 3,683 shares that represent 0.003 percent of their share capital are attending remotely through telematic means that allow their connection in real time with this venue where this meeting is taking place. Remote voters who have voted before the meeting, so ones that are voting remotely through electronic means are considered to be present in this meeting.
[SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] In accordance with the information read by the secretary, we hereby declare validly convened this OGSM. And from this point onwards, As per the call to the meeting and on our website, the shareholders who are remotely attending this meeting may exercise voting rights regarding proposals as to points 1213, which the board would have this general shareholders meeting approved as well as Exercise the right to a consult to vote on item 14. Should proposals be made in regards to issues not included in our agenda, remote participants may cast their votes when the secretary reads their proposals. And in any case, remote participants regarding all the proposals, be they included or not in our agenda, will come to an end when after The secretary reads the summaries and we begin voting commences in this venue. The nori will take good note of the number of votes and their meaning, votes cast here, votes cast remotely and will so report to the authorities so that they be taken into account with regards reporting on the results.
I also would like to let you know that as of now and until the end of the time allotted, remote assistance and remote attendants rather may send via written form, their intervention, their speech, their request for information, their clarifications or their proposals. As these Written documents are received. They will be available to all parties present at the notary's desk, and remote participants will also be able to access them on the bank's website. And now and to our legal effects, I give the floor to the notary. Now in order to not disrupt good order and notwithstanding the the right to intervene of all shareholders where they may make the comments which they deem appropriate for the consideration of the persons gathered here, whoever may have reservations or wish to protest the manifestations regarding the number of shareholders attending, share capital present, Please come to the notaries desk who will take due note of these comments and observations and we'll put them on the record.
The floor goes to the notary. Good morning, all. In accordance with Article 101 of the Trade Register as Notary of the Board, I let the assembled parties know that should any shareholder wish to express reservations or protest regarding the manifestations As per the number of shareholders or capital stock present, they may do so now. Thank you. We continue now with the GSM.
In order to carry out our meeting in an orderly fashion, we request all Ladies and gentlemen, shareholders or their proxy holders who are with us today who wish to take the floor and who wish to request information or qualifications in accordance with the law to kindly identify themselves, proceed to the notary's desk, Let him know your name and last name, the number of shares held or shares represented. Those shareholders who are off-site in any one of the areas or venues and who are following the GSM via the Internet may also wish to register and so request of the notary. Also available at the information points are copies of the annual report for 2018. You can also access via remote the website of the banks where you will find said annual report for 2018, which includes consolidated accounts And the management report also consolidated, which includes non financial consolidated information together with the independent assessment report. The policy with regards to the distributions of directors for 2019, 2020 and 2021 as well as the Annual report regarding remunerations of directors, which will be voted, consultative, and the yearly report for corporate governance.
You can see that in the chapter called governance in the addendum adjusted to the CNMP. Said annual accounts for 2018 includes reports from the Boarders Committee, the audit, the remunerations committee, the nominations committee, and this includes the a report regarding remuneration policies for the directors as well as a report regarding related party transactions. And thanks to the social media, we can also view on this said website the annual accounts, management reports, including non financial information and audit reports for Banco Santander S. A. And the group with regards to fiscal year ending on 31 December 2018.
Finally, all of these documents are available at the registered office and on the bank's website at least as of March 4, which is when this call was published. Thank you so much. And now we are going to hear about relevant information, reports that will doubtless be of interest.
President of the Government of Cantabria, Mayor, other distinguished guests Good morning. Good morning, and thank you very much for joining us today in this Annual General Meeting. 2018 has been a great year in which we have successfully completed the plan which we started in 2015. We announced then our strategy, a strategy based on customer loyalty and digital transformation. And we have worked with a clear vision to strengthen the trust and loyalty of our people, of our customers, shareholders and also the communities where we operate and with an aim to help people and businesses prosper.
During this period, including last year, we have grown to become one of the most profitable and efficient banks in the world, and our balance sheet is even stronger. All of this we achieved in a competitive environment for our industry, which is more challenging than expected. We are one of the few banks in Europe that has grown revenues since 2015. Customer revenues increased 24% and constant euros to almost €46,000,000,000 And we have achieved this in a sustainable way, increasing the number of loyalty customers by 44% to close to 20,000,000 and almost doubling the total number of digital customers to 32,000,000.
This is because We are nurturing talent by developing, making a more profitable result. Our attributable increased from €6,000,000,000 in 2015 to €7,800,000,000 in 2018, reaching an RoTE of 11.7 with an efficiency ratio of 47%, the best among our comparable peers. And today, we are even stronger. We have exceeded Our capital target for 2018, reaching 11.3 of 11.30 of core Tier 1 capital maximum quality. Please remember that back in 2014, before that capital increase, it was an 8.27%.
So to summarize, apart from strengthening our capital base by €18,000,000,000 we have grown our business and its profitability while delivering increased cash dividends per share paid to our shareholders, an accomplishment few of our competitors can claim in this period. Our strategy then has produced results, tangible results. A motivated team can gain the trust of more customers, which in turn creates greater value for our shareholders and allows us to continue supporting the communities in which we operate. Today, the Santander team has a common culture based on the shared goal of always striving to do things in a simple, personal way which joins us together, which changes the way we work. We are now among the top 3 banks to work for in 7 of our main markets, 4 more than in 2015.
But none of this would be possible without the great work of our people. The 100,000 persons, all of you, who are in contact with our customers and the other 100,000 of you who make everything work from your support roles. Each and every one of you matters. All of you are important. All of you make a difference.
Thank you for your commitment. Our success is based mainly We nurture talent by developing initiatives To identify and ward the professionals who best represent this culture. Age For instance, we have our young leaders program, which allows us to help 280 young persons develop, Some of whom are with us today. Welcome to all of you. And we've advanced in terms of diversity.
We want to be best practice. 55% of our work women. But we only occupy 20% of the group's management positions. But here's a positive piece of information. Here in Santander, Spain Today, we women are a majority among our regional directors, 7 out of 13.
And by the way, Rosio Bierba, who is with us today, a territorial here in Cantabria. And we rank at the top of the Bloomberg Gender Equality Index. We know, however, that there is still much to be done. Our goal is that in the medium term, the number of women positions in the group be at least 30%. And of course, any evidence of a gender pay gap is eliminated.
We want to be the best bank for our customers. We want to create lasting relationships with them. We want Santander to be their primary bank. And today, we have 144,000,000 customers, 23,000,000 more than in 2015. So delivering for our more than 4,000,000 shareholders means ensuring that the money they have placed into our trust increases its value.
Since September 2015, when we announced our strategy, total return to our shareholders is of 15% than the European Bank Index. With the approval of the 4th dividend in this meeting in 2018, We will pay shareholders a total dividend of $0.23 per share. This represents an annual increase of 4.5% of the total dividend and 9% in the cash dividend. Since we launched our strategic plan in 20 our shareholders have received €0.80 per share in dividends, which represents in cumulative terms, including 2018, a return on investment of 18% of their total investment. And finally, And this is very important.
The market has not flourished, but in relative terms, The difference with the 2nd largest bank in Europe is 30%, 26 percentage points more than when we presented our plan in September 2015. These results allow us to further support the communities in which we operate. In 2018, we helped over 270,000 entrepreneurs in developing countries, And we continue to be the company that most resources devotes to supporting higher education in the world. We want, of course, to ensure that what we do today does not compromise our tomorrow, our future. This is why we proactively support a transition to a low carbon economy and fight against climate change.
We are proud to be a leading bank in project finance for renewable energy projects and 1 the 3rd bank in the world, the 1st in Europe with regards terms of sustainability, and this is according to the Dow Jones Sustainability Index. And today, there are 2 new issues to take into account. We wish to eliminate all single use plastics in all of our buildings in the world by 2021. Also by 2021, we want to ensure that 60% of the electricity we consume stem from renewables and 100% in 2025 in all of those countries where it is possible to certify the origin of power. Throughout 2018, we have continued to strengthen our internal governance.
We have created the Responsible Banking, Sustainability and Culture Board Committee, whose chairman and majority of members are independent. We've also strengthened the independence of the audit committee, demanding this independence to all its members. And we have strengthened the role of the nomination committee with regards corporate governance, which before pertain to another committee, in line with the new guidelines approved by the CNMB. Our executive committee has a majority of external directors, 3 of whom are independent. And this creates the right balance between its daily functions and the recommendation that the makeup should be similar to that of the board.
As you know, in January, the Banco Santander Board agreed not to continue with the appointment of Andrea Orsau as CEO of the group. The board considered that it would be unacceptable For a bank, a retail and commercial bank such as Santander, taking into account our values and responsibility towards all our stakeholders To bear such a high cost, the high cost of hiring one person even of Mr. Orsolf's talent, Jose Antonio Alvarez will continue in his role as Chief Executive Officer as well as Vice Chairman of the Board. And we will continue working together and delivering positive results as we have done during the last years. To accelerate the execution of our strategy, We have simplified our organizational structure.
The main objectives are to increase collaboration and accelerate decision making to generate more and more values as a group. These are the main objectives of this change. Our management focus will continue to be based in our 10 main markets, grouped now in 3 geographies: and Scott Powell. Finally, we are proposing today that Mr. Henrique de Castro be appointed as Director.
Enrique de Castro will support our digital transformation, thanks to his experience in senior management positions in technology companies and his knowledge of the digital world and customer, Bemvindo. We want to ensure that the makeup of the board is balanced and diverse. We have a good balance between executive and external directors, most of whom are independent. 33% of the members of the board come from outside of Spain compared with 7% of the board prior to my appointment. 33 of us percent rather are women, but we want to go one step further.
And we have set a goal that by 2021, the board has between 40% 60% of each gender, 40% 60%. So I think it's fair to say that we have achieved our 3 year plan, all the while improving the bank for our customers, while also building all the while a more responsible bank in all areas. Because the Bank of the 21st Century has to be responsible to earn the 1st of all, the first step is to have a meaningful purpose, 1 in our case, which is to help people and businesses prosper. This commitment as a responsible bank demands of us that we address 2 major challenges. The first challenge is the new business environment.
The transformation of society and of the economy is unprecedented. We live in a competitive environment, We Companies, that is changing, one that has all of us assuming greater responsibility. So how are we doing this? Well, first, by even further strengthening our culture and the capabilities of our teams, building a more effective organization and a best in class corporate governance to ensure that we do contribute, that we do address these changes that society as a whole expects. And the second challenge is to support and foster inclusive and sustainable growth.
We want everyone to have access to financial services. And this is a challenge, especially in Latin America, but not only there. In Latin America today, There are over 300,000,000 persons who are not fully integrated into the system. We have set the ambition of financially empowering 10,000,000 people from now Investing in inclusion and empowering people is the right thing to do, but furthermore, It is profitable. We will generate results in a responsible way while fulfilling our purpose as a bank.
And forward looking, We are going to continue to elaborate on the strategy that we have followed during the last years. This is our best option looking forward. We want to accelerate our transformation, and we will do it as we have done so far. We will leverage our main strengths. Our global scale is the result of being leaders in our local markets.
And this allows us to face the many challenges of the future but with confidence. This scale, together with our geographic diversification and our retail oriented business model, allows us to generate more predictable results than our peers while allowing us to continue to grow. And for the next few years, we have set ambitious targets, always with the objective of growing our earnings and the tangible net asset value per share. We want to be more profitable and reach an ROTE of 13 to 15. We want to be even more efficient and improve our cost to income ratio so that it'd be between 42% 45%, and this will drive us to generate more capital to reach our target of that 11% to 12% fully loaded CET1 capital while maintaining that announced strategy to increase to 40% to 50% our dividend payout ratio.
This plan is based on 3 pillars. We need to continue to improve our operational performance.
And profitability. And we're going to do so leveraging even more shared services and technology across the group. As a result, we expect to raise our European's business ROTE from 11% at present to 12% to 14% in the medium term. Now obviously, we have the situation on Brexit, which continues to cause uncertainty. We have done all we can to prepare for the U.
K. Withdrawal from the EU with or without a deal. Whatever happens, we will be there to support our customers. In terms of the integration of Banco Popular, it is progressing ahead of plan. We have already completed the integration of the headquarters, And the objective is to complete the full branch network integration in July 2019.
The business is also progressing well with good growth in both SMEs and also consumer loans. The United States represents 1 third of the global financial market. But even more important for us, It has strong links with both Europe and Latin America, where we are the leading bank. During the last three years, we have made excellent progress in resolving legacy regulatory issues, while also strengthening the foundations for growth with an excellent team. Today, we have the base to generate profitable growth over the next few years and build a successful franchise, leveraging our scale and the strong links between the United States and the other geographies and businesses of the group.
And in 2018, U. S. Attributable profit after tax rose by 74% in constant euros. Again, in the Q1 of 2019, it will be the geography with highest growth, more than doubling profits obtained during the last quarter of 2018. Our target is to raise Santander U.
S. RoTE from the current 8% to 11% to 13% in the medium term adjusted to a normalized capital level. In Latin America, which is a highly attractive region, we are the leading private bank. Our objective is to continue supporting the economic and demographic growth in the region and as a result, further improve the group's growth and profitability there. Our aim is to raise combined ROTE of the region from 19% today to 20% to 22% in the medium term.
Q1 of 2019 is a good starting point to reach these goals. Despite 31 basis points of negative regulatory impact with preliminary data. We closed the Q1 of 2019 with a higher than 11.20% CET1 according to that preliminary data. The environment in which we operate continues to be complicated, but we are growing credits and deposits, increasing the number of digital clients and reducing delinquency rates. The CEO will further develop on this quarter's evolution.
Today, we have announced our intention to buy the stake of minority shareholders in Santander Mexico. We believe in Mexico, in the potential of its financial industry and the potential of Santander in Mexico, which today is one of the leading banks in the country. If all minority shareholders were to take up the deal, this acquisition of 25% of Santander Mexico would entail an investment of almost €2,500,000,000 that we will pay with new shares of Santander BAG. And this deal would have a positive impact on the group's capital. For our shareholders, this deal meets our strategic and financial criteria has an attractive return on invested capital and allows to increase in the future, the net profit of the group and the organic generation of capital.
For minority Santo del Mexico shareholders, is an opportunity to monetize their securities with an attractive premium of 14%, gaining exposure to a global diversified bank and with growing results and more predictable than our peers. The second pillar of our plan is digital transformation because gaining the trust of our customers requires in the digital era offering domestic experience at any time through any channel and at competitive prices. And we want to be the best global and open platform of financial services. For that, we are working on 2 roads in parallel but coordinated. On the one hand, transform our banks, our supertankers, as we call them, digitizing and automating all our processes and integrating new technologies.
We can leverage our global scale and share the benefits of our investments to increase collaboration. Investing in digital transformation in a global way has already delivered efficiencies of €680,000,000 in 2018. And in the medium term, Our objective is to generate additional recurrent efficiencies of nearly €1,200,000,000 Out of these savings, €1,000,000,000 will be generated in Europe in our net efficiencies compared to 2018 year end and 250,000,000 will come from Popular. And the remaining amount will be through the optimization of our technology resources and operations across Europe. To generate even more value as a group, we have launched Santander Global Payments Business, a new global business unit that will manage the payments businesses of Santander Group, Global Trade Services and Global Merchant Services.
Payments are the basis of our loyalty strategy, and this is a market expected to grow 9% annually. Today, we already have more than 80,000,000 active credit cards worldwide and manage €500,000,000,000 transfers and payments per year. But even more important, we already have 4,000,000 SMEs and 1,200,000 merchants as customers. At the same time, We continue developing new businesses with high potential. Our speedboats, which share their experiences with the large supertanker banks in the group, but also competing in new markets.
OpenBank, our 100% digital bank, which as you know was relaunched in Spain in 2017, has almost 1,200,000 customers, but even more important, 38% of its active customers are loyal customers. This is not normal in these digital banks and there's a huge difference that sets us apart from all the other digital banks. And in the medium term, we expect the Open Bank to expand to a total of 10 countries in Europe this year. Another successful Speed Road is super digital, the financial solution for the millions of people in Latin America with an access to traditional bank accounts. This business already has 500,000 active customers in Brazil, Mexico and Chile and allows us to serve this segment in a profitable way.
We aim to reach 5,000,000 customers in Latin America in the medium term. The 3rd pillar of our plan is to continue improving our capital allocation to drive further improvement in profitability. To achieve that goal, we have established more ambitious profitability targets by segment, increasing the thresholds of required profitability. And we have linked the variable remuneration of our management with the new capital and profitability medium term goals. A little over a week ago, we announced our new strategic plan, which I have just summarized.
Although we have to execute against that backdrop of continued and profound geopolitical, technological and environmental changes, I am fully confident that we will achieve this plan. In Spain, The electoral campaign begins today. Like most of our citizens, I am proud of the country that I call home, a country that has come a long way in the last 25 years. Spain today has great strengths. Among them are the Spanish people, but also some of the best public services in the world and we have a great potential for the future.
But to safeguard our prosperity in the future, we need world class education. I always say that education is not everything, but it is almost everything. And it has to be the priority. Whoever wins, whoever rules, we need a permanent commitment to education. To invest more in education, we need an economy that generates the resources to fund leading public services.
A strong economy is the goose that lays the golden egg. We all want social justice and equal opportunities. But to get there, we must generate economic growth. The purpose is not just to grow, but to ensure that the benefits of economic growth reach everyone. On economic policy, we all know what works.
And above all, we know what does not work. What works is budget sustainability, an environment that pensions for workers to have a decent life, but that in turn are sustainable. And if we want to attract national and foreign investment, which Spain needs, Institutional stability and strength are critical. Also having an environment that supports entrepreneurs and investors who create jobs. We are, according to the economics data of 2018, 1 of the 24 democracies in the world.
So if we want a Spain that works for all, we need an economic policy that works for all. This is why I would like to ask politicians to talk straight. I would like to ask them to speak straight, speak clearly. After the elections, we need to flee from short term measures and promote a reformist agenda with a long term vision that fosters inclusive growth and social cohesion, which is only possible if business owners invest and create jobs. If recent polls are accurate, this will not be the test of a single party.
We need an alliance for inclusive growth. It will be necessary to reach agreements between the different political forces, and this requires a strong sense of responsibility and maturity. We know how to do it. We have proven it in the past. Spain must also regain prominence in the European construction, working for greater integration and participating in the decisions that decisions is also our job.
Building Europe has to do with national politics. Spain Europe is the solution rather than the problem, and Spain is a European country. The globalization, the digital revolution, the impact of the financial crisis, All of this has created a surge in support for policies and politicians who are questioning and sometimes wish to undermine the liberal economic order on which in Europe have been built over the last few decades. Brexit is our cannery in the mine, warning us of the dangers of ignoring these trends or dismissing the concerns that many millions of people have about their jobs. They're truly concerned about losing their jobs, their prosperity and their future.
Europe is not perfect, but it is the best model of proven democracy, a model based on an open and inclusive and And this will not be possible without a strong and profitable financial sector. We know that in Europe, 90% of SME loans granted by the private sector comes from banks. Therefore, banks are essential to ensure that Europe continues to be an area of prosperity and sustainable growth. And in order for European banks to continue to fulfill our mission, We need to complete the banking union and break the link between sovereign risk and the financial sector, ensuring we have regulation that successfully balances the need for caution with the need to ensure that companies have access to credit to invest in the future and not permanently question the legal and regulatory framework are some of the pending tasks. Growing sustainably also demands tackling the digital talent from a European perspective.
We have the economic and human capital to not miss this train. Today, we are behind China and the United States. There is no higher priority for the new European Commission. The aim should be to put technology at the service of citizens and not the other way around. And we need a fair competition framework for the digital era to get there.
Same activities, same rules in data processing, in taxation, in payments, in transport, in all sectors of the economy. Shareholders, we are a company that aims to endure. To do this, it is essential to have a vision and deliver results, but also to do that in a responsible way with a purpose that creates value that benefits us all. And while we strive to do all this, we do not forget down there, our headquarters, our home city, a city that was reborn after the devastating fire of 1941. Thousands of homes and businesses burned down.
Thousands of people were left homeless and lost their jobs. Paco Santander supported the victims in helping the city and its inhabitants to rebuild their prosperity. It donated money and was one of the main institutions that financed the reconstruction of the city. The fire that devastated Santander was a few meters from our headquarters in Paseo Pereda, which was safe from the flames. And to ensure that this building, which dates from the beginning of the 20th century continues to be one of Santander's symbols.
Contributing to the world's knowledge of its culture, customs and people, we have begun its transformation. Soon, we will present plans for a complete renovation of the Pareta building to the Mayor's office. This will be a gift from the bank to the city and the region of Cantabria, a region that connected us in the past and will continue to do so in the future. The new pereza will be open to the public and will be devoted to culture and technology. It will offer the best restaurant and leisure options.
It will be the meeting point for both inhabitants of Santander and tourists. An iconic protected building that will result in a space where the past and the future will meet, it will be shown in an interactive way. It will be a contemporary venue and an experience that represents the principles of our bank and what we seek to offer our customers. And I would like to thank Mayor Gema Iual and her team for their involvement in taking this important project forward. I would also like to President Revila and his team for their support.
Both the Pereda And the project we're working on, on the building behind the Banco Mercantil building project are symbols of our commitment to Cantavia and the city of Santander at a time of transformation and challenges everyone. Our work is worthwhile when we see this impact. And when we say that our purpose is to help people and businesses prosper, we mean it. And our commitment to this city and to Cantabria is an example of how we turn these words into reality. Thank you.
And now we give the floor Distinguished authorities, Ladies and gentlemen, shareholders on, good morning and thank you for attending the Annual General Meeting. I am going to focus on 3 points. First, I will briefly look at the economic environment in 2018 and the main challenges that we face as a bank. I will then turn to the performance of the group's results as on other occasions and the group's results, the various units in 2018. And lastly, I will devote some minutes to discuss how this year has begun 2019 and explain the drivers that will be used to achieve the medium term objectives that we announced a few days ago at the Investor Day.
Before beginning, I would like to express my to the more than 4,000,000 shareholders who have placed their confidence in Banco Santander. We have a solid project for generating value, which based on profitability, efficiency and innovation. And our goal is to keep on consolidating our long term relationship with each and every one of you. And I also want to address the more than 200,000 professionals who work for the group. All of them play a key role in the excellence of our results.
And thanks to their commitment, dedication, passion and effort, we continue to improve every day. I will begin by commenting on the macroeconomic context of last year in order to better understand the framework in which we carried out our business. The trend starts at the 8th of 2018. They were positive and gave us reason to be optimistic. However, as the year passed, There was a change in market sentiment, and there were bouts of instability reflecting, For instance, the trade tensions between the U.
S. And China, the lack of an agreement by the U. K. Parliament on Brexit, The orientation of Italy's fiscal policy and some others of varying intensity, particularly in emerging markets such as Argentina, Turkey and to a lesser degree, Mexico and Brazil affected by their respective electoral cycles. This represented a greater slowdown in economic growth and initially envisaged.
The Federal Reserve and the U. S. A. Slowed the gradual rise in interest rates and the European Central Bank held its rates with Euribor rates negative for longer than previously estimated. All of this resulted, doubtless, on greater pressure on the financial sectors' revenue.
Despite all this, the countries where the group operates their business grew with the exception of Argentina, although the performance was varied. And to this macroeconomic context, We need to think about additional financial sector that we face. 1st, We need to digitalize in order to improve customer service, in order to adapt to multichannel demands. This will boost customer loyalty and transactional levels and thus business productivity. This digital disruption has intensified competition in the last few years with the entry of the so called FinTechs in providing some financial services, hence the importance of establishing rules of fair play, which our Chairwoman referred to, which are the same for all players, both regarding regulatory aspects as well as in the tax sphere.
And in this sense, we must use the best technology available to solve our customers' real financial problems and needs. Although currently, this increased investment in digital transformation represent a further pressure on costs in the medium term, It will help us improve and notably our levels of efficiency. Above all, by developing new products and services tailored to our customers' current and future needs. 2nd, there is the increase in regulation, which while helping make the financial sector more solvent in terms of capital, liquidity and governance, must avoid excesses of bureaucracy and asymmetries translating into higher costs and a reduced competitive capacity for European banks in relation to other geographies. Additionally, progress must be made in creating a single Banking market in Europe, which will enable the financial sector to achieve greater economies of scale as the U.
S. Does, thereby improving the quality of services, costs and thus, profitability. There will still be mergers and acquisitions at the local level. However, for the sector's consolidation at the pan European level, in order to create strong profitable banks With simpler structures and more nimble processes, we need to progress in this mentioned banking union. Thanks to Santander's transformation process over the past years, I believe and I assure you that we are in a good position to tackle these challenges and manage them proactively and efficiently.
Shareholders, ladies and gentlemen, The Chairman has presented the group's performance over the past 3 years, and I am going to focus on 2018. We generated an attributable profit of €7,810,000, which is 32% higher in constant euros and 18, 18 percent, in euros at current prices, mainly due to the impact of the depreciation of the Brazilian real and the Argentinian peso. Furthermore, these results were impacted by nonrecurring charges largely related to integration processes in Spain, Portugal and the Corporate Center. The underlying profit, which is before capital gains and provisions, was €8,064,000,000 with double digit growth in the U. S, Brazil, Spain, Mexico and Portugal in their respective currencies.
As for the balance sheet, loans And customer funds increased by 4% in constant euros and rose in 8 of the 10 core units, mainly in Latin America, as demand for loans in Europe remained relatively low. All of this enabled us to end 2018 with 1 of the best ROTEs of our peers and an RORWA clearly higher than that of 2017. In terms of value creation for shareholders, Growth in the TNAV, that's tangible equity, together with a cash dividend per share was 8% in 2018. However, and due to the already mentioned macroeconomic circumstances as well as sector specific impacts, The share price performance was not as expected in 2018. Even so, the total return for Santander shareholders in 2018 was clearly the best of its peers in the Eurozone.
As regards the units and their performance, 2018 saw a constant improvement in profits and in the main metrics in almost all countries. I will begin with Europe. In Spain, specifically, the integration of Popular is ahead of schedule. We have completed in 2018 the legal integration. We have unified central services and territorial teams.
We now have a single platform, and we have begun to integrate the branch network. By the end of this month, we will have integrated some 600 branches in Galicia, Asturias, Cantabria, the Basque Country and Catalonia. 600 branches, as I said, which represent 40%, 40% of the total. We aim to complete migration in July. And we recently reaffirmed the profitability goal we announced at the time of the acquisition, even though we have less interest rates and demand for loans than we envisaged at the time.
But we have not just devoted our efforts to integration. We have also continued with our new strategy of digitalization and transformation. We strengthened our position in payments by mobile with the launch of Smart Bank, which is a new way of relating to our more than 600,000 millennial customers, while showing good commercial dynamics in insurance, car turnover and loans to SMEs. We are taking advantage of Popular's notable position in ISEMIs to boost our market share in this segment, while remaining leaders in business with large companies and private banking. At the end of 2018, we had more than 17,17,000,000 customers, of whom 4,800,000 are digital.
This is in Spain. All of these actions are reflected in our results of €1,730,000,000 which is 21% higher than in the previous year. Santander Consumer Finance continues to be Europe's leading consumer finance entity. Its business model is based on geographic diversification, efficiency and systems for risk and recovery that enable us to maintain NPL ratios and cost of credit at historic lows. We have progressed in optimizing, transforming and digitalizing the area.
As a result, we have grown lending by 7%, which is well above the market, which remains pretty well flat. We had high profitability and profit increased for the 9th year running to €1,296,000,000 In Portugal, we completed the integration of Popular's business in an exemplary manner. This, thanks to the cooperation of teams in Spain and Portugal. This process enabled us to boost our position as the country's largest privately owned bank by assets and loans in domestic business. All of this is underscored by good results.
The underlying profit is €480,000,000 up by around 10%. Poland now is registering 1 of Europe's highest GDP growth rates. In this environment, we acquired the retail and SME business of Deutsche Bank Polska, which positions us as the 2nd largest bank in the country. Furthermore, our bank, Bank Zahodname, adopted the Santander brand, modernized its branch network and all the while continues to be leaders in digital banking. So with regard to results, customer revenue was 6% higher, And underlying profit then is close to €300,000,000 Finally, And against a backdrop of uncertainty over Brexit, business in the U.
K. Was carried out in an environment of moderate growth in terms of GDP and greater competition. In this context, the bank worked on installing the new structure as required by the regulator, which separates retail from wholesale banking and this in order to minimize any disruption to the customers. Underlying profits teen was impacted by the competitive pressure on revenue and by costs for regulatory, strategic and digital transformation projects, in line with our strategy that focuses on customer loyalty and digital and operational excellence. As a result, it was 8 lower in local currency and the number is €1,362,000,000 Looking ahead, we will be keeping a watchful eye on the various scenarios arising from the U.
K. Decision to leave the European Union. Ladies and gentlemen, Shareholders all, please be aware that we are prepared for all of them and that we will continue to give the best service to our customers. I will now turn to the United States, which is in a more advanced phase of the economic cycle with sustained GDP growth and unemployment rate at historic lows and inflation under control.
In this environment, 2018 a great year for our franchise as we began to reap the rewards of the efforts made in previous years in transformation, regulatory compliance and optimizing the capital structure. We passed the federal reserve stress test, improved the trends in business volumes and promoting a strong increase in profit to €552,000,000 I am very optimistic we will continue to significantly improve profitability, one of our priorities for the coming years in this geography. Lastly, In Latin America, a region that offers a high volume growth potential and strong banking opportunities, We have had a good year despite the depreciation of some currencies, mainly the Argentinian peso. Brazil enjoyed an excellent year. Thanks to the growing strength of our franchise, a strategy focused on improving customer experience and satisfaction and double digit growth in loans and funds.
We gained market share in segments such as auto finance, acquiring and cards. In less than 4 years and despite the country's tough recession, we doubled the profit in local currency to EUR 2,605,000,000 in 2018 and increased return on capital from 14% to 20%, and there is still room to increase our positioning. Another figure to keep in mind, since 2015, when the strategic plan began, the number of loyal customers has risen by 65%, and the number of digital customers more than doubled to almost 11 0.5000000. In Mexico, a country that like Brazil offers considerable growth possibilities, we continue to strengthening our distribution capacity by investing in technological and digital development and in transforming the branch network. We launched many products and apps in order to respond to each segment's needs.
This produced a significant increase in loyal and digital customers, growth in business volumes of more than 10% an increased capturing of payrolls more than 500,000 in the year. Profit was up 14% in local currency at EUR 760,000,000 as a result. As the Chairman mentioned, this morning, we announced an operation to repurchase minority shareholder stakes in Santander, Mexico. This is a transaction which will allow us to improve the group's growth profile by investing in a country with growth and high profitability. We estimate around a 15% return on investment in the medium term above the cost of capital.
Following this deal, Mexico will increase its contribution to the group's profit from 8% to 10%. As we've been saying, Santander Mexico is deep into an investment plan with the aim improving operational capacity, mainly in retail banking. Following the completion this process, we will have a more competitive franchise with the ability to continue to gain market chair. Therefore, we are optimistic regarding future prospects. We hope to complete this operation in the second half of this year.
Chile continued to transform its commercial network with more work cafe offices and the launch of a new branch format in the Q4. We also stepped up our specialized proposals such as Santander Life and Life 2.0, which offer customers a new way of relating to the bank. In a more dynamic economic environment, we increased growth in business with large companies and SMEs. Attributable profit rose 8% in local currency to €614,000,000 driven by the good performance of customer revenue. Environment marked by instability in fiscal and monetary adjustments made in order to guarantee the country's future stability.
In this context, Santander Rio's business and customer revenue performed well, and we made progress in the digital transformation. This was not reflected, however, in the bank's profit, which fell 54% to €84,000,000 as it was affected by the high inflation accounting adjustment. The profit of the units of Uruguay, Peru and Colombia grew strongly, rising more than 30% in their local currencies. In aggregate terms, leverage on growth and revenue and by the commercial transformation. I will end the 2018 review looking at our global businesses.
Santander Corporate and Investment Banking, our wholesale banking business, focused on improving profitability and using capital efficiently. We strengthened our leadership position in Latin America and Europe, developed our U. K. And U. S.
Franchises and strengthened collaboration with our commercial banking networks. Profit increased 8% in constant euros to EUR 1,705,000,000. At the end of 2017, we created the Wealth Management division, which integrates private banking and asset management. During 2018, we improved our offering to customers in both businesses in order for them to be more global, better coordinated and more based on each one's specific needs. The division's total contribution to the group's profit was BRL 1 point €15,000,000,000 including the total fee income generated by this business, 13% more than in 2017.
In 2019, an insurance business will join this division, a business that offers 1 of the banking industry's best growth prospects. Next, I will outline how we have begun the New Year and the new medium term strategic plan. We are in an environment of reduced economic growth, as recently published by the IMF in its Spring World Economic Outlook, which projects lower growth for 70% of the global economy in 2019. Additionally, interest rates in Europe lower than previously envisaged. In this context and based on provisional figures, We have seen continuation of the trends with which we ended 2018.
In Business Dynamics, the number of customers continued to increase. Of note was a more than 1,500,000 rise in digital customers in the quarter. This is reflected in the growth in business volumes, both in loans and deposits, which grew by around 5% year on year. Of note were Latin American countries in loans and rises in almost all countries in deposits. Furthermore, we are combining this growth with a good quality balance sheet.
As a result, the NPL ratio continued to fall slightly. Quarterly P and L is affected by lower wholesale revenues in a difficult market environment for the sector and due to the considerable inflation adjustment in Argentina. Excluding these impacts, We saw growth in customer revenue in line with expectations. Costs beginning to reflect the synergy realization from integrations in Europe, better operational leverage in the U. S.
While keeping costs under control in the units where we are investing to increase distribution capacities such as in Mexico. Cost of credit remained at the levels of the last few quarters, still below 1%. Finally, net charges totaling approximately €100,000,000 which includes the current optimization processes that we're carrying out in the U. K. And Poland.
And lastly, as regards solvency, we organically generated an estimated 20 basis points in the quarter, well above the average quarterly generation. This gives us an optimum starting point for attaining the new medium term goals announced at the Investor Day in London on April 3. The Chairman has just explained the main objectives and strategies of the main geographic areas. I will set out the main drivers we will use to achieve them. 1st, we want to improve our operational capacity and at the same time manage our cost base more efficiently, carrying out the ongoing integrations in an exemplary way and fostering the use of shared services, especially in Europe.
Secondly, we are going to speed up the bank's digital and technological transformation. This is underscored by the heavy investment of €20,000,000,000 over the next 4 years. We want to improve customer satisfaction and loyalty, increasing market share and generate new revenue sources in order to achieve growth greater than that of our peers. Specifically, We have set the following goals: increase the number of loyal customers to 26,000,000 compared to 20,000,000 in 2018 50,000,000 digital customers. We have 32 in 2018 and at least 50% of sales to be done online.
This figure reached 32% in 2018. Number 2, we want to make us one of the top 3 in customer satisfaction in all the countries where we operate. Strengthen the already existing global businesses, Santander Corporate and Investment Banking and Wealth Management, in order to foster cooperation between countries and generate greater transversal revenue develop our global AMEN's service platforms. Based on our experience in Brazil, we will launch the platform for global merchant services and the rest of Latin America and in Europe. We will begin with Mexico this year.
We will also launch Global Trade Services, which will provide the best comprehensive services for SMEs and corporates offering them products previously only available to large companies. 3rd lever, we will assign capital to the most profitable segments and businesses. Therefore, and given the greater growth expected in the region, Latin America will account for at least 30% in the medium term. These drivers should be reflected in growth in net interest income and volumes of around 5% a year increase in fee income higher than that in volumes enhanced efficiency in order to continue being the sector's reference bank maintain the cost of credit at minimum levels. As a result of all these actions, we are confident in reaching our underlying ROTE target of 13% to 15%.
The evolution of interest rates and monetary policy will determine in which part of the range we will be in. And lastly, let me reaffirm our commitment to the group's employees. We aim to be one of the 10 best companies to work for in at least 6 countries, which will be reflected in more motivated and committed professionals. Our responsibility to society: fostering the financial inclusion of those groups with lower income. We will continue to offer them products that are better tailored to their needs and facilitate access to financial education.
Our objective is to financially empower 10,000,000 people with these initiatives by 2025. As we did with our previous plan, we firmly believe we will achieve these goals. The beginning of this phase is a new challenge for everyone. We will continue working to achieve a level of profitability, efficiency and value creation in line with the market's demand and that of our shareholders. Shareholders, ladies and gentlemen, thank you for putting your trust in Safranco Santander.
Next, we will hear from the Chairman of the Appointments Committee and the Remunerations Committee that will report to the Board on the activities of these 2 committees and more specifically, the proposals for reelection appointments submitted to the meeting, the remuneration policy of the Board and the other proposals in terms of remuneration that will be voted on. Next, the Chairman of the Audit Committee will take the floor to report on the activities of the committee and more specifically on the outcomes of the audit and how the committee has contributed to the integration integrity of the financial information that is presented for your approval under Item A of the agenda, I give the floor to the Chairman of Emergence and Appointments Committee.
As in previous years, I will make my remarks in English and these will be translated. I am addressing you as the President has said in my as Lead Independent Director and also as Chairman of the Appointments and Remuneration Committees. Each of the committees has drawn up a report on its activities during 2018, which has been approved by the Board of Directors. In previous years, the reports were issued separately, but this year they have been included as part of the corporate governance chapter of the consolidated directors report, which is part of the 2018 annual report and which has been made available to shareholders on the bank's website and at its registered office since the notice of this general meeting was published on the 4th March. Both committees consider that their respective reports are transparent and that they provide comprehensive information on their terms of reference, membership and activities carried out in 2018.
In particular, the summary of the activities of the appointments committee is focused on the group's selection and succession policy and the renewal of the Board and its committees the succession plan for executive directors and senior management The annual verification of the status of each director, the periodic suitability assessment of directors and senior management, including the examination of their potential conflicts of interest and the oversight of the group's internal governance.
In particular,
I would like to highlight that early this year, the Board decided to broaden the mandate of the Appointments Committee with respect to corporate governance matters, taking responsibility for functions that previously were the responsibility of the Risk Supervision, Regulation and Compliance Committee according to best practice and in particular, the most recent guidelines issued by the CNMV. For the remuneration committee, the summary of its activities is presented in relation to the remuneration of directors, other members of senior management and other executives whose activities may have a significant impact on the risk decisions of the group as well as the directors remuneration policy to which I will refer
later.
The effectiveness of these committees during 2018 was considered as part of the overall internal assessment of Board effectiveness carried out internally this year. The committees considered the findings resulting from the review and concluded that their performance in 2018 was satisfactory. With respect to item 3 on the agenda for today's meeting relating to the appointment and reelection of directors, the Appointments Committee supported the proposed and reelection of these directors after having reviewed the Board's skills, requirements and diversity goals and the bank's continuing commitment to diversity and inclusion. I would like to draw particular attention to the proposal to appoint Mr. Henrique de Castro, who brings to the Board experience of the technology and digital industries along with significant experience in the U.
S. Market, evidencing our commitment to attracting international experience and to introduce skills which are best aligned with the strategic objectives of the group. With respect to gender diversity, the committee has met its target of having appointed at least 30% of women onto the Board of Directors and has established a new objective that by 2021, the Board will aim to ensure that persons of either gender do not exceed 60% nor represent fewer than 40% of the members of the Board. With respect to remuneration related matters, the Board of Directors has recommended for your approval today items 9 to 12 and item 14 on the agenda. For item 9 on the agenda, shareholders' approval is requested for the director remuneration in the consolidated directors report and is essentially a continuation of the 2018 policy.
It includes, First, the remuneration of the directors for their roles which is within the aggregate amount permitted for these purposes which is recommended for your approval under Item 10 of the agenda. And secondly, the remuneration of senior executives for performance of their executive duties which combines fixed and variable components. The variable remuneration consists of a single incentive linked to a short term variable remuneration plan, which is performance tested against the group's annual business objectives and a long term variable remuneration plan, which is 36% of the total award and which is tested against the group's long term objectives and the payment of which is deferred over 5 years from the date of the award. In the opinion of the remuneration committee, which has been advised on these matters by independent experts, the remuneration policy, The contractual terms of the directors and the specific remuneration of directors are aligned with the group's financial performance and consistent with market standards at comparable companies. 12 on the agenda.
Shareholders approval is requested for the remuneration plans requiring the delivery of shares or share options. I would like to highlight the introduction of a digital transformation award which is intended to attract and retain the best talent to advance, accelerate and deepen the digital transformation of the Santander Group, which is one of our strategic priorities. The Digital Transformation Award is aimed at no more than 250 employees of the Santander Group. Please note that the directors of Banco Santander are excluded from this award and the award will only vest if key milestones are achieved. For item 14 on the agenda, we submit for your non binding vote the Annual Report on Directors' Remuneration, which has been approved by the Board of Directors.
The report has also been included in the corporate governance chapter of the consolidated Director's Report. In light of the above, the remuneration committee recommends approval of the proposals 9 to 12 and proposal on the agenda as submitted to this general meeting. The proposals have been made available to shareholders on the bank's website at its registered office since this general meeting was called. In addition, today, on entering these premises, shareholders were handed copies of the wording of these proposals. With regard to my activities as lead director, I have increased the number of meetings with the non executive directors during 2018 to ensure that the views of independent directors are fully heard and represented.
And I have also increased my interaction with investors and shareholders. In this regard, as I did last year, during the last few months, I have been meeting with institutional investors and analysts in Europe and North America, receiving their feedback and comments, in particular with respect to the effectiveness of the governance of the group. Finally, I would like to comment on the process followed by the appointment of Mr. Andrea Rochel as Chief Executive Officer of the group and the subsequent decision not to proceed with the appointment. This process began after Rodrigo Echiniqua announced his intention to retire as Executive Chairman of Santander Spain.
The appointments committee and the Board agreed that Jose Antonio Alvarez was best placed to fill this key role within the group. This in turn necessitated the appointment of a new CEO. And as a result, we reviewed the suitability of a number of internal and external candidates for the role. The nominations committee, the remuneration committee and the Board, with the assistance of external advisers, were engaged in the succession planning to identify a successor for Jose Antonio Alvarez as Group CEO. The government's process was rigorous and progress was reviewed regularly as is normal for a decision of this kind.
The appointment was subject not only to relevant authorizations, but also to compliance with the provisions governing termination of Mr. Rochelle's employment contract with UBS and would in no event be effective before the 1st January 2019. When we announced the appointment at the end of September, the Board agreed the future annual compensation which the new CEO would receive, which was in line with that of Antonio Alvarez. However, at that time, it was not possible to determine the final cost of the group's share of deferred remuneration paid to Mr. Ochshell by his previous employer, which would have been foregone.
The Board therefore proceeded with the appointment on the basis of considered estimate of the likely cost to Santander based on advice, precedent and expectations of mitigation due to the nature of the relationship between the two organizations and very specifically because Santander has been an important client of UBS for many years. In January, the Board decided not to proceed with the appointment of the CEO because the costs of compensating him would be a sum significantly above the board's original expectation at the time of his appointment. The Board considered it unacceptable for a retail and commercial bank like Santander to pay this amount to hire a single executive, especially considering our culture, our values and our responsibility to society in the countries in which we operate, regardless of the level of experience and seniority of the candidate. The Board decided to proceed with the appointment, shareholders would have had the opportunity to vote on the appointment and on the remuneration at this Annual General Meeting. I believe difficult decisions like this one demonstrate the strength of the group's corporate governance and the care the Board takes to work in the best interests of the Bank and its shareholders.
Ladies and gentlemen, I would like to conclude by saying that the members of the 2 on which I have commented have worked diligently to set a high standard in the transparency of the information provided to you as shareholders, And I hope that you have found it useful and easy to understand.
I give the floor to the Chairman of the Audit Committee. Good morning, ladies and gentlemen, shareholders. As the Chairman said, I will address you as Chairman of the Board of Directors, not a committee. According to our bylaws and the rules of the Board, the committee must report to the AGM under the development of its function, areas under its competence and how the audit committee has contributed to the integrity of the financial information. Traditionally, the audit committee reported to presented to the shareholders a separate report where we gave details the most important aspects of its composition functions and most relevant activities during the year.
This year, Given the possibility granted by the CNMV of presenting it in a different format, The audit committee is one of the chapters of the annual report made available to you in the web corporate page in the corporate page. The consolidated management report includes, in one single document, reports that before were presented separately like the annual corporate governance report, the annual remunerations report and the sustainability report because we think it makes it easier for you to understand, and thus, we avoid also repetitions. I also wanted to say Of course, later on, the secretary will give you more information. But I will just add that at the beginning of the years, we changed the rules of the board on 2 aspects. First of all, it was established that the other committee must be made up simply by independent directors, something that was already happening, but it was not established as a rule in the board's regulation.
On the other hand, the committee now must review not only financial information, but non financial information as well. That is the result of the entry into force of the law that changes the code of commerce. The also changes in the audit account law. The audit committee has been assessing functioning in the past year, reaching the conclusion that it has carried out effectively its functions to support and advise the Board. In the annual report, we gave a brief description of the activities developed by the audit committee throughout 2018, grouping them around the basic functions that we need to carry out.
Now I will give you a brief summary of the main aspects that you will see in more detail in our report. In 2018, The Audit Committee made on 13 occasions in which it spent 19% of its time to the annual accounts and Financial information, 17% to the external audit, 34% of the time to internal audit, 11% to internal control systems in the group and the remaining 9% to the other functions. Next, I will mention very briefly the most the salient actions under each one of these functions. Firstly, with regards to financial information, After reviewing it, the audit committee reported favorably on the annual accounts and management reports of the bank and of its consolidated group corresponding to 2018. Accounts that later on are drawn up by the Board and that today are submitted for your approval Under Item 1A of the agenda, the annual reports were reviewed by PricewaterhouseCooper's external auditor of the bank that issued its reports with an absolutely clean opinion, with unqualified opinion On the group and as well as on different businesses of the group and the intermediate financial statements and the financial information that a listed company, we make available to market.
We also received an unqualified opinion. The Controller participates in all our meetings, and therefore, it is aware of how we stick to the applicable accounting standards. The committee was informed on the implementation of MIF-nine standard in force since February 2018. This year, as a consequence of changes in the legislation, because of the transposition of the EU regulation on the non financial information and how we must report on it. We are also Submitting to your approval under Item 1B, our non financial information report.
This information is part of the consolidated report where we give information on the business model, environmental and social aspects, personnel aspects, tax aspects, respect of human rights or the against corruption. Lastly, and with regards to the oversight of the process to draw up the financial information, in 2018, the committee was on the assessment and certification process of the internal control model of the group. And the conclusions on its effectiveness were we did not detect any material weaknesses. In this regard, price water has cooperated report on the design and effectiveness of the internal control system verifies its effectiveness. Secondly, and with regards to the independence of the external auditor, the committee has checked that the different auditing services comply with what is required on this aspect and with the internal policy approved by the committee and by the I also verified the percentages of the accrued fees for different for services other than auditing services and also the fees paid by the group As a percentage of their total fees in the world of this auditing company, we also studied the related party transactions.
After all this, we issued a favorable report on the independence of the external auditor. He was present in 11 of the 13 meetings of the committee held in 2018, which has allowed us to carry out the function of acting as a communication channel between the external auditor and the Board. Moreover, on two occasions, the committee met with the external auditor without the presence of the bank's managers to learn about its concerns with regards to the audit work and examined the collaboration given by group employees and providing the information, all of that has contributed to include the quality of the audit work as well as of the financial information that is made available to the market to investors. Moreover, the external auditor reported to the Board on 2 occasions to present its report on the annual reports and quarterly information on July June 30. After 3 years in which was appointed the group's and the bank's auditor, the audit committee has reported favorably other proposal to this contract to audit the accounts of the year 2019, which was raised to the Board and is submitted today to your approval Item 4 of the agenda.
In this proposal, the committee has taken into account several like the resources and experience of price, the coverage of its network, its long experience and the specific knowledge on financial information standards, its independence of quality efficiency of the services rendered as well as the information that They have provided the different inspections, all of that according to what is established in our rules. Also with regards to internal audit, I should point out that the heads of this function were also present in 11 of the 13 meetings held by the committee in 2018. Amongst other things, they reported on the internal audit plan for the year is degree of execution and reports issued as well as degree of and compliance of the recommendations. Also, the committee met with the internal auditor without the presence of other bank managers in order to analyze matters that have to do with the functioning of internal audit and make sure that it has the necessary resources to develop its functions. The committee has reviewed the application of the measures included in the internal audit strategic plan for the period 2016, 'eighteen.
And as a third line of defense, it wishes to contribute to the good governance of the operation and risk control. The committee, moreover, gave a satisfactory opinion on the development of its mission as internal control independent of the business as well as the development. The performance of the Global Head of Audit, which was communicated to the remuneration committee and the Board in order for them to determine their remuneration. I should also mention that we received the information on the group's presence in offshore territories, verifying that we're still making progress in reducing these institutions well as in controlling and supervising them. Also, to comply with the good tax practices that the bank is a part of since 2010, the committee was informed by the tax personnel, the group on the tax policies applied by the group.
Committee held joint meetings and allowed them to obtain an integrated view of the main risks assessed. Moreover, we've increased the coordination with the audit committee of the main subsidiary. Several of its chairmen participated in meetings of the committee, and I myself have had meetings with them in their countries. In order to learn more about the different functioning of the committees and how they are aligned with the governance committee that rules the relationship between the parent company and its subsidiaries. I'd like to finish by conveying my satisfaction and that of the committee for the quality and extension of the information that was facilitated to all the shareholders for the purpose of this AGM.
We believe that this new format of the annual report in 2018, which includes
Very good. We now have time for 1 minute speeches. Among those present in person or by proxy, 39 shareholders have requested the floor. They will speak in the order they are called. The aim is that All of the requesting parties may make their 1 minute speeches and if necessary, request information or clarification as they may wish regarding the items or perhaps make proposals, I kindly request you to be clear and concise.
And specifically, I remind you that you must limit your comments to those issues that are germane to this meeting. In my capacity and in accordance with Article 29 of my bylaws, I will direct the debate, and I will end it when I deem the issue to have been sufficiently discussed. In compliance with Article 17 of the board bylaws, the time initially allocated to each One minute speech is actually 5 minutes per shareholder. In view of the number of persons requesting, it is not mandatory to avail yourselves of those 5 minutes, but I do request that you stick to those 5 minutes, and I will let you know. Monica Delgado Fernandez.
Good morning, Madam Chair, directors, I'm Monica Delgado. I am here, and I represent 770 shares. And the fact is, ma'am, I'm very happy with the results obtained by the bank because When I see the news, I have the feeling that the financial system is about to tumble down and there's no tomorrow. I see that the bank's results continue to be good. Actually, in your speech, you have talked at length about the new strategic plan, the forward looking plan for Banco Santander, But you have not made too many references to the past.
And thus, I would like to ask you whether you are satisfied With the bank's compliance over the past 3 years, with the bank's performance over the past 3 years, which have been difficult, And if you are satisfied, do you think that we shareholders can Be certain that the bank is going to continue to comply in the future. Thank you very much. Maria Theresa Eschari has the floor.
Good morning. My name is Maria Teresa Echari. I just wanted to the floor to thank the Board of Directors for having increased the dividend last year. I understand that the dividendo election is very interesting because it allows us to decide what we want to do. And please, I just want to ask you not to ever forget about the small shareholders Because for us, the dividend is of the essence because we're getting nothing from our deposits.
[SPEAKER UNIDENTIFIED COMPANY
REPRESENTATIVE:] Thank you. Now the floor goes to Julian Arana Mendieta. Good morning. Good morning, madam chair. I think we all know that the bank has a long standing with Latin America at all levels.
For sure, our bank over there is a pillar and that is a land of growth. Do you think this is going to continue to be the case? Do you think that we are not going to be by the political instability in these countries. And you know, I read this morning that we're going to buy Mexico, the bank in Mexico. I think that if we think that Mexico is going to be successful, if we have a strong bank there, well, this might be a good investment.
Having said this, could you please elaborate on how that transaction is going to be Thank
you very much, Mr. Shareholder. I'll give the floor now to Mr. Manuel Huertas Teran. Madam Chair, Directors, I come to this meeting with 4,700 shares.
Now I want I'm here to congratulate you for canceling the hiring of who of the CEO to be. I think we have excellent people. You can do the job extremely well. We don't need anyone else. Yourself and Mr.
Alvarez are doing an excellent job, and thank you so much for not going ahead with hiring Mr. Orsall. I'm very pleased he is not
The floor now goes to Ana Barreiro Lopez. Good morning. I'm Anna Barera, and I am here today at this meeting as Director of the International Institute of Law and the Environment. I speak on behalf of this body, And I speak on behalf of this and another organization, ShareAction. My question has to do with 1b, which is examination and if appropriate approval of the consolidated statement of non financial information for the financial year 31 December 2018 and which is part of the consolidated directors report.
11, 18 of 28 December regarding non financial information and diversity, which this board has made a reference to has increased the information which this report is to include non financial. This information is absolutely essential if we are to know how companies behave with regards environmental issues including climate change as well as risks that have to do with all of this. And thus, My organization has carried out a detailed analysis of this information, which the group presents to the shareholders. I'm going to try to limit myself to the time allotted. Pages 6566 address the issue of the financing of sustainable projects and 60 6 and 67 address environmental and social challenges or risks.
And this report on a number of occasions brings to mind that this bank has updated its sectorial policies, Among them, the one that has to do with power. In accordance with what 1118 mandates, companies with regards, among others, climate change, the importance of greenhouse emissions generated as a result of corporate activities. 1 of the activities of Santander is to provide products and services to in the sector of power or energy. And thus, this policy does not include clear criteria that would have it stop funding coal mining and power generation Carbon based despite the fact that some European banks have already implemented these criteria. Furthermore, Santander can provide services and products to existing customers who stop using coal based energy and carry out transactions for coal plants if and when they reduce their CO2 emissions by 20% or achieve full compliance or not exceed 80 grams of CO2 per kilogram.
Despite the fact that the report includes clear examples of the financing of sustainable projects and despite the fact that you yourself, Madam have informed us at the beginning of this session that Santander is the 1st bank in financing or funding renewables projects. This report does not include information regarding the funding of projects that include fossil fuels and this is essential if we are to truly assess the threats to the climate as recommended by the task force on climate related financial disclosures. So for instance, in accordance with Bank Track's report, which is called Banking on Climate Change, Santander destined 14,000,000,973 U. S. Dollars to projects that have to do with the life cycle of fossil fuels as of the signing of the Paris agreements.
I would request, Madam Shareholder, that you please limit yourself to the 5 minutes. You have one more minute. Thank you. Let me summarize. The report includes information regarding the contribution of this bank to the 2020 sustainable development objectives.
And now, members of the board and shareholders, please remember that climate change affects all of us, yourselves included. We are none of us free. But furthermore, decisions to be adopted today as well as decisions to be adopted on a daily basis affect the future of the bank because climate change is affecting the financial sector as well. Do not forget. And here come the questions.
What projects have been or will be financed by the Santander that will continue to affect greenhouse gas emissions? Second question, how has the Santander measured the climate threat that it is exposed to upon funding these types of projects in accordance with legislation and in accordance with recommendations? 3rd question, How is Santander contributing to achieving the objectives set forth by Agenda 2020? And what are the indicators? And finally, 4th, Will the Santander inform about the material impact of the updating of its policy regarding funding, Keeping in mind who the current clients are, will Santander determine stricter measures for existing Clients, thank you very much, and I thank you especially for having allowed me to go over the time line.
Thank you very much, Mr. Shareholder. I give the floor now to Kuga Gogolevsky. Kuga Bobolevsky, are you in the room, sir? It's your turn now.
Hello. Good day to everyone. My name is Kuka Gondalesque, and I represent an organization, a coalition that is called Foundation Dura Fquequena. In Spanish, it would be development, yes. Now the name, I think, says it all.
I do not agree with the chair on the number one priority For the EU Commission, for me and for younger people younger than I, the number one aim is Climatic change. 2 companies in Poland extract 60,000,000,000 tons of coal a year. The Polska Energy Group, PGA, a state owned company that produces electricity and they have lignite plants. And this is what they use as a source of energy, lignite. And actually, they're thinking of operating new mines and build and continue to mine coal.
Now why am I saying this? The World Bank It is the it's financing both companies. And it is financing these companies and other companies that also pollute. So my question is what is going to happen? What is going to be the energy policy in view of climatic change?
Because today, you talked about cybersecurity development and a commitment with the communities where you operate, but I haven't heard much about climatic change. And I think this is one of the great challenges that we're facing. And I already sent you my questions, which are when will Santander Bank have a policy that is in line with the need to reduce greenhouse effect gases at a global scale with a clear time line, with details And What are you going to do to contribute to make sure temperature does not continue to increase? When are you going to publish a strategy to gradually reduce Emissions, I think that your competitors in several of the markets where you operate already have clear plans as to how to gradually reduce these actions that contribute to the rising temperature. So when are you going to publish information?
When are you going to have a policy that establishes that the company's approval will not be financed, when will the bank publish a policy that will forbid to finance companies for projects 4 lignite or coal plants in the world. Thank you. And I hope to hear good answers from you.
Thank you, sir. The floor to Clara Pardo. Good morning, ladies and gentlemen, Madam Chair, members of the board, I represent 59,493 shares As President of the ONG Manos Unidas, I'd like to say thank you for allowing me to address all of your good selves today. I want to say thank you to Banco Santander. Thank you for your help to the needy.
Manos Unidos is an NGO. The Catholic church established us and we are 60 years old this year. We have been working 60 years in 60 countries With some 600 projects yearly, which literally change the lives of a 1000000 and a half people every year. Also raised awareness in Spain regarding hunger in the world, which affects over 821,000,000 persons. This is according to the FAO.
So we insist on how important that is for companies such as Santander, who must continue to responsibly assist in the achievement of a fairer world, a better world for all. Corporate social responsibility is today a linchpin of any company because it responds to societal needs and it responds also to the needs of large and small companies who are to continue to contribute in social, economic and environmental terms. We believe that Santander, for years now, has been doing its job. And thus, the relationship between Santander and Manos Unidos is a very Close knit relationship. We have been working together for years.
If my memory does not fail me, it began even before the Santander built its CSR policy at the end of 2,002 and it has been kept alive over years. In 2018, Manos Unides received funds and assistance from Santander basically from the Fundo Santander Responsable Solidario to launch A number of development efforts, €500,000 in countries such as Peru, India, Salvador, Cameroon, Nicaragua and Spain. Practically 50,000 persons have benefited from these actions. The scope of these projects does not respond to one single pattern, battered women, youth, human rights, Health, education. So once again, thank you, Santander.
I would like and this is my question. I would like to know what the criteria are by the bank to back NGOs and to launch their commitment. Thank you.
[SPEAKER UNIDENTIFIED
COMPANY REPRESENTATIVE:]
Thank you, madam shareholder. I give the floor now to Mr. Antonio Javier Calzado Aranda. Good morning, Madam Chair, members of the Board of Santander Bank authorities, dear shareholders who are following the meeting Here in person in the Sardineda room. And I would also like to greet Those of you who are following this meeting in the Cantabria room and the Bahia room, the adjacent rooms.
My name is Antonio Javier Casa Doranda, and I own 5,000 Santander shares. I come from Ciudad Real. This is the first time that I attend in person a general shareholders meeting of the bank. I have traveled 1300 kilometers to come here, and I feel very frustrated because I've had to hear the speeches of the Chairwoman and CEO through a screen. For that, I could be sitting in my living room, very comfortably sitting in my living room, as many shareholders are doing so, the ones who are following us online or via streaming because they decided to do that, that way.
But I to travel the 1300 kilometers to be here in person. And I asked about all the procedures that I had to fulfill. I asked the Santander branch. And I also consulted your relations with shareholders office. And I called and they told me I only had to come with a letter of invitation.
And when I came here, I was told that I could not sit in the main room that the room was full, that I should have reserved a seat. So I think they could have warned me about this either at my branch when I asked about attending this meeting and also when I called the Investors Office. So I want to ask you, Are there Class A and Class B shareholders? Do we have preferred shareholders and other types of shareholders, 2nd class Shareholders, Madam Chair, in your speech, you asked that the government That stems from the elections. It should do its work with responsibility, thinking about society and guaranteeing social cohesion.
I would like to ask you, Madam Chair and members of the board, that equally, you should also treat all of us in the same way, we shareholders, the owners of the bank. This is the most important body of the bank, the shareholders meeting. So please guarantee that all of us who fulfill the requirements to attend this meeting have the right to do so with the same conditions and with the same rights as any other shareholder. And for that, I ask you, Madam Chair and members of the Board, that you implement the mechanisms that can guarantee that people will have the same rights when attending this meeting. Perhaps you need to increase the number of seats or the meet in a larger room, but we should all have the same right to sit in this main room in this beautiful, beautiful city.
Now to finish, Madam Chair, in your speech, I understood that the next government in Spain will be formed by more than one political party, not by a single political party as has been the case for many years. And I, as a citizen, would like to know if you have information that the rest of us are unaware of to make that statement that the next government will be a coalition government or we'll have components for more than one political party. Thank you.
Thank you very much. I'm going to Thank you very much for having come. I hope it's the first but not the last time you join us. I know that Ciudad Real is very far away. Has larger venues, I think not.
But we are definitely going to take a close look at those criteria because you are right. You have come from a long way, and you deserve to be As to elections, I do not have any information which other Spanish citizens have or don't. I think what And the floor now goes to Mr. Hans Martin,
Yes.
Thank you. Fellow shareholders, my name is Hans Martin Bullman. I'm talking here and I'm being here not as an NGO, but VIP. We help the Association of Institutional Shareholders and have tried to keep content from shareholders. We are a bank.
Banco Santander is a bank, is in many aspects one of the biggest, one of the most important banks, not only in Europe. All what you told us this morning, Mrs. Botin? We're so positive, so nice, so happy. But where is my share price?
Share price is decreasing, decreasing and decreasing. You have to change this. You have to talk about the share price. You have to take note of our share price, your and our share price. If you increase the profitability of the bank by 50% in 2, 3, 4 years, Don't forget the share price.
The bank A cockobond is not a coconut. A cockobond is a famous tool to finance. And the Cocobond had had always a certain strategy and follow-up. You changed the market issues. Why did you do this?
Did you offer our reputation? Or do you want to change the Cocobont attitudes? You change things. And one thing you changed is a very good one. Some of the speakers coming from NGOs did not yet remark this, I think.
The committee you invented, I have to look for the papers to quote it correctly. It's the Responsible Banking Sustainability and Culture Committee. Talk more in public, not only today, talk more about this content. You are doing even business with it. You issued a green bond for a client together with an Italian bank.
You had done this very successfully. Perhaps you are looking for further banks. I, as you remarked, certainly coming from Germany. There are a couple of banks on the market in different colors, perhaps becoming red. Just an offer for a comment.
Andrea Orssell. That's only a name. Andrea Orzel was a banker. It was disclosed in September by Franco Santander to come. I asked myself, did Santander change the strategy of the bank?
Do you want to go investment banking? Please point it out, make it clear. Do you change the bank in this way? Won't you? Won't did somebody change the bank in this way?
If you would not have been the January this year, if you would not have disclosed Not to pay €50,000,000 to somebody who had not yet worked any day, Just as a welcome pay, you would have been whipped away, everybody on the Board. It's good that you stopped, but it's a mega disclosure accident that you disclosed what you disclosed in September last year. That's not a family and friend decision to choose a new CEO. The Board is like a democratic government. All the Board is a democratic government.
Lead it. Sure, by share and lead. Now we have Shadi Antonio Alvarez. Welcome back. You will be with us for a certain time.
You have a certain period Or we have to look every day at the Internet if you are there. You will go digitalization. I will not take more time. I will not raise this question, but I give you the chance to talk about With 2 small remarks. Stop battling.
Start business in the board. Experience and know how is like a grain, outgrowing new wisdom, hopefully increasing share price. Thank you.
Thank you very much, Mr. Shareholder. The following shareholder to take the floor is Mr. Alvaro Bichina y Mujica. Good day, everyone.
I'm Alvaro Anicinae, and I own 1,001 shares. Madam Chair, I heard in your speech that you talked quite a lot about responsible banking. I think it's Excellent that you take advantage of the size and position of your organization to have a positive impact on society. I love being a shareholder of this type of company. Often, we read in newspapers that Large companies like the one you lead pay very few taxes in comparison to small businesses or individuals.
I understand that this might be misleading. I think that the bank already pays quite a lot, and that is money that does not reach shareholders, what I would like to know is if you can explain how much we pay in taxes. Thank you.
Thank you very much. And now the floor goes to Manuel Argente Benedicto. Good morning. I am going to try to speak Very briefly, just 3 or 4 very clear questions. But first, let me say that I also come from far away.
I come from Zaragoza, which is not as far as Ciudad Real, but I too, you know, was surprised. I came with lead time, and I was surprised. I wasn't able to enter this venue, and I also watched you on So I have a question, Madam Chair. All of the persons in this hall right now are shareholders? That's my question.
Because if not, Well, what is going on? Are there persons there who are sitting where shareholders should be seated? I didn't think of posing this question, but I thought it was germane. Now even though we've heard about information from Specific information from the CEO. I'd like to ask about the onboarding of Popular.
We've heard that everything is coming along well, but I'm a small, tiny shareholder. And I'm also a customer of Banco Popular. When are we going to know whether that merger is complete, whether that migration of accounts and deposits and so on, when is it going to be complete? And I'm going to focus here. 1 of the items talks about the recent change in the organizational structure of the bank because it says that there's been a change.
What does this actually mean for small shareholders in Spain specifically? I see here specifically Another one of the items, item 12. It says Approval of the group's bid house. I don't know what that is, but it seems to me that that's like a leveraged buyout. So I wonder, is that good or bad?
Who is this good for? Who is it bad for? Is that going to be good for us small shareholders? Or is that only going to be Good for big shareholders. And then 12E, I see and it says Literally plan for employees of Santander U.
K. Group Holdings, Plc And other companies of the group in the United Kingdom, it says plan for employees. And what about Spain's employees? Is there a special plan for Spanish employees? Because I'm not seeing Spanish employees mentioned there, it just says U.
K. And finally, and this is my final question, 13, Item 13, it says, and I read, authorization to the Board of Directors to interpret, remedy, Supplement, implement and develop the resolutions approved by the shareholders at the meeting. When I read this, I said, question mark, question mark, question mark because I'm reading it, but I'm not in agreement with it. And I put that down in writing, agreements taken At a meeting of this kind, any meeting, well, I understand that the meeting is So is somebody going to censor what we're agreeing on? I think that that's outrageous.
Good day, Madam Chair. I want to congratulate you because In Santander, we no longer see any sign from Popular Bank. It's gone. The former shareholder was Ask the question. I was going to ask you about the integration between Popular and Santander.
But could you give us more details? Because It is something that does concern us here in Santander, the integration of Popular. But I have another question still. Is it true that the bank is going to bring to the headquarters in Pereda Street the collection, the painting collection wonderful painting collection that you have at Urquijo Bank. If so, congratulations to you because you have chosen 2 magnificent architects for the restoration of these two buildings, of Santander and that of Mercantile Bank.
Thank you, sir. The floor goes to Francisco Javier Martin Sanchez. Good morning, Madam Chair, Directors, shareholders, I'm Francisco Javier Martin. We shareholders focus on the share price and the dividend. Last year's dividend was fine.
The share was not that fine. My question is, Mrs. Butin, What does the future hold for our share? And do you think that the strategy presented, do you think it's really going to help the share price go up?
Thank you, Mr. Shareholder. I give the floor now to Maria del Carmen Gracia. Good day, Madam Chair. I want to congratulate you for your work and for being a woman leading such an important bank.
I just wanted to know if it is true that You are unable to get the a good return for the money you make? Because I read in the Internet that a great investor does not invest in this bank because they think that you are unable to make the most of the money you have in order to make the share an interesting asset to buy.
Thank you, ma'am. The floor goes to Mr. Javier Valero Quiros. Good morning. Good morning, Mrs.
Botin and Directors. I'm Javier Bolero. Madam Chair, ever since you are at the helm of the bank, there have been 2 capital increases, 2015 2017, that was for the acquisition of Banco Popular. In 2015, that was during the Christmas season, suddenly, and small shareholders could not participate. In 2017, we could.
So I think that we cannot complain about the facts as they are because dividends have gone swimmingly. I'm not really sure what the numbers are, But over the past 3 years, I know that the results have been good. The share price, of course, could have been better. But Santander is a haven, I'm asking. Thank you.
Krista?
Thank you, Mr. Shareholder. I give the floor to Mr. Javier Blanca Cerrado. Hello.
My name is Javier Blancas. I come to this meeting representing Adikai's small savers, customers and Retail shareholders of Santander. Banco Santander is listed at EUR 4.38 per share, EUR 2 below what it would be if we distributed the net worth of the bank among all the shares. In February 2017, it was also EUR 2 below its book value. That was also the share price of Poplar.
Are the accounts that you're announcing and publishing today, are they as reliable as those of the Popular. Price Waterhouse Coopers is now being in looked at Intubica as an auditor of Popular. And you're using exactly the same auditor. Should we be worried? And here, it refers for a provision for risk of litigation because of the acquisition of Banco Popular for EUR 1.
It's referring here to the process, but the Iekai is part of this process in court. And It mentions the difficulties to value the risk. It is not difficult to value the risk. Popular closed their annual accounts with a net worth of EUR 5,700,000,000. That is the risk.
That is a net worth that Santander bought for EUR 1, taking away that debt net worth from the Popular shareholders. In the Deloitte report, it was said that Popular could not go on with its activities in the bank because it would lose its license. Nevertheless, the L'Oreal report at no time clarifies what was the true injection of capital that Santander had to do in Popular because And in the other bailout in Spain, many banks have been bailed out with a fraud. Our taxpayers have lost a lot of money. In the case of Popular, with the intervention of Santander, the next year, they have a net worth of EUR 5,700,000,000 that those things don't match.
The shareholders of Popular should be today among the shareholders It was a ridiculous offer for those shares that were acquired in 2016. That offer was just to avoid further trouble in court. But it's not only the Popular shareholders that have suffered by Santander, also the customers of Popular. In Page 560 of the annual report of Santander, it has mentions clause floor clauses, and they will be you will pay those that are admitted. Well, the claim presented Regarding floor clauses, Popular did not pay back any of that money.
It says here this money is to pay for claims. These claims will be lost. These were never paid by Popular. And what the annual report does not say is that in the procedure of a class action suit. In November 2018, the court in Madrid ruled in favor of consumers.
And in March 2019, It clarified to all the banks that it was not going to emit clarifications and that they had to appeal to the Supreme Court. So the question is, is Santander going to appeal to the Supreme Court in this class action suit for the floor clauses. Also, there are other customers affected By because they were charged for certain fees when asking for a loan, etcetera. And then court said that, that was not acceptable. What are you going to do in that case, too?
Thank you. And lastly, I'd like to remind the board that if you want to attract shareholders among your customers, the reputational image, the solvency image of the institution is tarnished if they don't pay their claims.
Thank you very much, Mr. Shareholder. The floor goes to Mrs. Anna Sabreros. Madam Chair, ladies and gentlemen of the Board, ladies and gentlemen, shareholder, good day.
I'm Anna Sebreco Ruiz, and I am here also as a representative of Adikai. And I represent small owners and shareholders who have delegated their votes. There's a number of issues which we believe to be and which we believe have to be dealt with by this board. First, the share price, which is at €4.48 per share. But the theoretical book value of the share, should we divide the net value among the number of shares, would be EUR 6 €0.61 per share.
This negative valuation that investors have agreed upon does not say much for the reliability of the amounts discussed today. In February 2019, the Instituto de Contabiria de Quintas has taken Pricewaterhouse to court for the Popular accounts in 2016. And excuse me, I am Confused here, says the speaker. The person who addressed us before confirmed that this is the same consultancy that is in charge of Banco Santander accounts in 2019. And further, in the annual report, we hear about provision to prepare for possible litigation in the case of Popular, and the amount is €1.
We are involved in the criminal suit or where we see that there are thousands of persons affected. And the contentious portion, which is in the hands of Addikai and its partners, underscoring the difficulties in assessing this risk. Well, this is a very straightforward risk to assess. If we look at the Banco Popular numbers for 'seventeen, net worth was €5,700,000,000 despite the activities in 2016 where the net worth was €10,000,000,000 That amount is what Banco Santander has snatched in exchange for €1,000,000 from its shareholders over €5,700,000,000 But shareholders of Banco Popular are not the only ones who have been Adversely affected by Banco Santander. If we see the annual report With regards provisions, it specifically says that provisions in the case of litigation, the calculations will take into account the number of claims to be received and among those, those that are admitted.
But Banco Popular has not admitted or We cannot understand how this has happened. And the annual report does not make a reference to 4712010 of Madrid regarding the class action shoot and incorporating retroactivity as set forth by the European Court of Law. And in 2019, there has been foregoing of all of the claims set forth and involving banks. So we wonder whether we will or will not be taking this to court. Apart from floor clauses, we have to talk about different fees, which have not been taken into account.
Banco Santander and Banco Popular, both In the face, rather, of Banco Popular, Alicay has also brought class action suits, which have not been taken care of. And thus, we have to bring New cases to court. So we wonder whether the board of Banco Santander wants to attract shareholders among its customers. And so far as it does not pay closer attention to potential claims, this situation is going to continue to adversely affect the image of the company, the image of the banking group. Thank you.
[SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Thank you very much, madam shareholder. I give the floor now to Mr. Julian Garcia Caballo. Thank you, Madam Chair and shareholders, directors. In your speech apart from giving us different indicators and figures, which were very good indeed.
You referred to something that Called my attention, but you've divided it into 2 parts. I think you've understood I understood that you have 200,000 employees. Did I understand you correctly? 200,000 employees. Many provincial capitals don't have that many inhabitants.
If everyone from Santander, children and retired had to work for the bank, we would be missing thousands of people. We couldn't complete your staff. So it's a very significant number. And I think that very few companies can brag that they employ so many people. Of course, we are in a global world.
And in order to maintain this type of company, I know there's need to hire many people. And we're competing with many companies who are hiring talent like Google and other companies that are, as I say, attracting talent. So my question is what is a bank doing to attract that talent to the bank? More so taking into account that the banking industry cannot be considered as one of the most attractive sectors for this type of talent. So what is it about doing to attract these very good employees, talented employees?
You also talked a lot about women. I'm very grateful for that because I am the father of several daughters. And of course, I want my daughters to have a brighter future. But you made some projections and gave us some ratios regarding women. That's all good and fine.
But what actions are you taking to make this happen so that you can reach those indicators of the participation of women in your company. Wanting to do it is Very good. But I guess you need an action plan to achieve it so that women who truly have the potential can get as high Azman. Thank you.
[SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Thank you. Thank you. Thank you, sir. And the floor goes to Carolina Reira. Good day to all.
Firstly, and on behalf of the Fundacion Oso Pardo, Thank you to the bank for allowing me to address this audience. Secondly, I would like to ask Mrs. Butin, a very specific question regarding the environment and biodiversity. We know that some human activities affect The biosphere adversely. The biosphere belongs to all and to future generations too.
But we human beings can also contribute to recovering habitats that seem to have been lost. And we can help species that were about to go extinct to recover life. And this is the model of action which is Encouraged by the Fundacion Banco Santander because they participate in the recovery of Villamino in Leon, a mining region and also looking at the habitat where brown bears live in the Pyrenees. We have a network of small forests, which is based on vegetable species, contributing thus to the increase and diversification of the nutrients for brown bears. We at the foundation believe that the bank has contributed so much.
We thank the bank and we thank other organizations in our country. And thus, I would request to Madam Chair that you please Thank you. Thank you. Thank you very much. And the floor goes to Miguel Angel Vasquez.
Madam Chair, Board and suffering shareholders, good day to you all. My name is Miguel Angel Vasquez Garcia, 182,303 shares I own, shareholder of Santander For 60 years, I was also affected by the integration of Banesto and the bankruptcy of Vanessa. During all these years, I have never sold a share, a single share, and I have always participated in the many capital increases carried out by the bank. Well, I'm going to give you The stick and the carrot. The carrot is in favor of the bank.
The bank is not at all guilty of what happened at Popular. I was a great shareholder. 200,000 shares I owned, and I don't blame Santander. Who was to blame? Whoever authorized the deal?
Nevertheless, when we talk about the stake, You are governing for a fund that is called BlackRock, and you don't watch out and look out for shareholders, minority shareholders, you're only looking out for those investors. And ever since you became Chairman after the death of your father, May he rest in peace. I miss him very much. When you became Chairman, the shares of Santander were worth €7.70 Today, the share price is €4.52 yesterday, €4.48, which means a loss of EUR0.285 per share. Now that loss is not offset by the dividends during year period as Chairman.
Do you think it is fair as Chairman? And do you think the you and your Board directors should earn what you make. I think you should lower your salary by 82.5%, which is by how much our share price has gone down. 3x, you've increased your salaries. You apply 200%, the maximum that is applicable for debentures For the bonuses, sorry.
The recommendation from the official Authorities is 100%, not 200%. It wouldn't matter if we had lots of profits. That would be fine, but we're not getting very good profit and you are getting paid as much as you're allowed to. So when you took office, you did 2 capital increases and minority shareholders were excluded from that increase. We had the no preemptive rights, and our dividend went from 0.60 to 0 point 20, in other words, a third of what your father gave us arguing that you were going to give it all in cash, which has not been the case After having done 7 script dividends ever since you are Chairman, I, of course, underwrote this.
I have no problem in doing so. But Iberdrola, for example, or Repsol do it differently. They always make sure that the share price does not lose value because at Iberdrola, their share price is worth the same and they do a scrip dividend, but the share price does not lose value. And the same thing can be said about MAPFRE or Repsol. Well, MAPFRE gives it all in cash.
No scrip. Mr. Shareholders, please, you need to finish up. Just a second. Don't worry.
We've heard lots of silly things said, And they spoke as much as they wanted. If you don't like what I say, that is not my fault. Just a second. I lost my favor. What can I tell you, Mrs?
Butin? I prefer 0.60 dividend that your father gave us and the 0.20 that you have been paying out lately, although it has increased a bit this year. Thank you for listening to me, fellow shareholders. And please watch out look out for the minority shareholders. One day you will need them.
One day you will have to resort to retail shareholders Because one day, that BlackRock Fund won't support you anymore. I always liked it that the Board of Directors was involved in shares and that they should be paid more in shares than in cash. To increase your bonuses and salaries, you need to make more money for the bank. The shares were multiplied in number. So the return per share went down.
So the last year in the year when your father was Chairman, we made more money as shareholders and what we're making now and what we've made all these years together. Please, Mr. Shareholder, you need to finish up. I give you an a minute. Please, please finish.
I really am very upset that I am cut short because this happened to me at Bilbao Bank AGM. Trade unions are giving as much time as they want. NGOs are giving as much time as they want, but we shareholders are not enough time. No, we'll give you exactly the same amount of minutes as all the others. There were people who are talking for 10, 12 minutes about silly things, that's not fair and things that have nothing to do like the bear, what's next, talking about dogs.
We're here to talk about things that affect the bank to defend retail shareholders. And I defend them when they are right, like with the Popular. It was Rod's case, not your fault. No, it was his fault, the Chairman of Popular's fault. Please, we can continue with this conversation on some other occasion.
You say very interesting things that I can have a response to. You know me well from Banasto. You know me well, right? We've already had this discussion in Banasto's meetings. Dialog is always useful and constructive, but we need to respect everyone.
And your father visited me, and that's for a reason.
Very good. And now Sergio Serrato has the floor. Good day to all. Madam Chair, members of the board, I'm here to congratulate you for your management of the bank in Brazil. This is a very difficult country, and you're making a lot of money.
So, you know, we know it's not easy. Thank you. Thank you. We have to acknowledge your hard work. I have three questions.
2 have to do with Brazil. 1 has to do with your recent announcement about actions in Mexico. First, could you please explain how we achieve these outstanding results? And are they going to be outstanding and long lasting in Brazil? And secondly, even if we grow more there, can we expect the bank to continue to be balanced and diversified?
And please, could you explain a little bit more what the Mexico transaction entails? Thank you, sir.
I give the floor to Santiago Alvarez, Barron. Good day, Members of the Board and Chairman, my name is Santiago Bolon, and I represent 200 7,000 shares. Santander is a brilliant bank. And that is why I would like To mention 2 things, and I'd like to hear a response from you about this because I I'm aware of how complex these two subjects are. Money laundering, that's the first thing.
I have sent the Secretary an article referring to and it says, This is how some multinationals cheat on the tax authorities. A liquidated And it says that our company liquidated in 2010 had 2 Current accounts opened until very recently at Santander Bank. Despite the fact that it was liquidated, they were paying through those accounts to their suppliers and this liquidated account is part is from the Carlyle Group that recently bought a significant stake in SEBSA. And the Santander Bank, it seems, had no knowledge that, that company that had accounts in the bank was liquidated. So based on that, the Santander bank will cross check its information with the tax authorities to ensure that Nundis doesn't happen Again, my second point is accounts that were opened at the Banco Central Hispanoamericano do not have the opening contract.
So years ago, an account was opened at the Central Bank and then it merged with Hispano and then it was absorbed by Santander. And the bank says that it must be taken into account that during that time, the bank has gone through several and there have been lots of migrations of branches from one local premise to another. Also during the past few decades, there has been a notorious change in which the contracts are we've gone from physical paper to digital. And in this and consequently, There are there's some old data that the bank no longer has control over. They don't have this data.
So are you going to do anything about this? The Santander Bank hasn't solved these situations where there is an opening contract. There are more cases. Santander doesn't scan all the new and old documents. We support the Santander Bank.
We want it to continue to be an international benchmark. But I think these things are not very good for our great bank. Thank you very much.
Thank you so much. And the floor now goes to Miguel Angel Hernandez Marco. Good morning, ladies and gentlemen, Madam Chair, my question has to do with the objectives and strategy of the bank in the U. S. A, which you have made a reference to in your presentation.
I know that our bank has improved over the last few years, has improved its performance in the U. S. But I have the feeling that we still have our work cut out for us to be one of the relevant banks there. Are we able and in a position to grow? And how, if so?
I think that the U. S. Economy is very important, but I think that it's also very important to be a strong bank in order to be able to leverage that economy. So this would be perhaps a piggyback question. Are you ready to enter the U.
S. Economy? How are we going to do it? How is this going to affect the bank globally? Thank you very much.
Thank you, Mr. Shareholder. I give the floor to Mr. Oscar Fernandez Montoya. Sorry.
I'm sorry. I was in the other room. That's why I'm a bit late. My name is Oscar Hernandez. I represent a group of handicapped people who work at the in the tax agency.
Service acquired by the company Konnecta in July 2018, a company that belonged until December of 2018 to Santander Bank. So my question is about The group of disabled people that I belong to, the Konnecta company back then belonged to Santander, and they laid us off without meeting Article 19 on the law of public
Jobs.
And so we asked for explanations and we have not been given an answer, Neither as a shareholder nor as a former employee of that company. The only response we've had was that of the higher court of justice ruling that we were right, a ruling that was sent to you, but still we've received no response. After sending you the ruling in our favor, these shares were sold, the shares of the Konnecta company, I mean. Can you tell us whether it was based on the ruling of the higher court of justice so as not to relate the Santander Bank in this very shameful event. Last year, you gave Ignacio Trevino, somebody who I know and somebody who represents a group of disabled like myself.
And He came here last year to praise the work of Santander. I cannot praise your work. We are a small group, 100 families. And all of them are not as fortunate as I am. These people have not been able to collect unemployment benefits.
And the company did not comply with Article 131 on public contracts. These people have not yet paid these employees. Banco Santander, although it is no longer related to this company, are you going to do something about this? Is your performance going to be as shameful as it has been until now regarding this matter. Thank you.
[SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Thank you, sir. And the floor now goes to Jose Antonio, Riz Iglesias. Hello. Good morning. After Hearing these very interesting comments and presentations, I have a question regarding how shareholders are actually This is for Madam Chair.
But before I do anything else, let me share my thoughts with you. I think it's clear that as of You're taking over the position you hold, which is in September 2014. You are keener To focus on cash dividends, not scrip, some shareholders apparently like this alternative. I personally, And I'm not alone. I would prefer a cash payout.
I can understand that this encourages the purchase of shares, not only in the case of international investors, but also in the case of minority, such as myself, which should, I think, have us understand that what is most important to us is the share. Well, that share price should grow. Apparently, This is the change that is in the wind. So having said this, my question is as follows, and this is a question for Madam Chair. This type of cash dividend, basically, is it going to be a priority for the bank?
And secondly, as a follow-up question, how would this strategy fit into what you have presented recently in London during the Investor Day. Thank you.
Thank you, Mr. Shareholder. I give the floor to Benigno Bueno Gutierrez. Good day. As I was there Lining up to sign in order to be given the floor.
I saw Some of your slides, and I focused on that, the one from OpenBank. And I agree with what you OpenBank is efficient, simple, agile. And when you need Someone's help in OpenBank. They're very good professionals. So I have to say I agree with what you said about OpenBank.
That's not the reason why I asked to take the floor. The reason I wanted to take the floor is to talk about the hiring of Mr. Orsau that was already mentioned here. And I think that this has given a lot of a discredit to our institution. Particularly after the explanation that we heard today from Mr.
Carnegie Brown, it looked like a game that was going on between the 2. I understand that the first step to recover the prestige that we have lost and which is so important for in a financial institution is that you, Chairwoman, should represent your notice. If you don't resign, there will be the opinion among people that the personal for you is more important than the professional side of things. And that is going to hurt our share price, As some shareholders have already mentioned, Madam Chair, I think you should consider resigning to regain our reputation and tell Mr. Carnegie Brown that he has had enough time to address This meeting for many years, we are in Spain.
You should speak Spanish.
Please.
The floor goes to Mr. Felipe Isquierdo. Good morning. Ladies and gentlemen, shareholders, I'm Felipe Scardo. Members of the Board, I would like to say that with regards to the items on the agenda, I have nothing to say, although I would underscore that there is something which is important and which I believe you are not dealing with appropriately.
And this is actually The way you treat the minority investors who participated in the capital increase in May 16, Banco Santander knew that the bank was not a sensible alternative. We heard that as a consequence, the Santander cannot say that it did not know of the fact. Those investors were tricked. And we know today that the accounts were, at the very least, grossly incorrect. In July 2018, the chair of that bank said things such as Banco Popular lied.
It was disastrous. You have no liquidity issue if you have creditworthiness assumed. And also with regards to accounts in April, that reformulation was begun launched by Urea Menendez, and the result was that not everything was clear on the board. 7 courts have sentenced in favor of the minority shareholders. And I know because I am The lawyer who actually filed suit for the first time in Spain, I am also the lawyer who has been successful in a suit in Barcelona, and it is because I am familiar with procedures.
And this is why I request of you that you please Turn your management style upside down. Madam Chair, I respectfully but forcefully request This of you, you are damaging current and potential customers, and that damage calls for A quick reaction. We see that it is a break off. At the very least, we could say that it is odd that the lawyers hired by the bank that bought the bank for €1, defend the solid nature of those accounts. Remember, The law firm was Urea Menendez.
Now one of our great philosophers said that we need to be persuasive, But we need to be right, and we need to know the law. And definitely, on this occasion, the bank is not right, and it does not know the law. So again, Please provide a feasible solution, accept that you will have to pay, and thus, you will recover the trust and the confidence that has been lost by shareholders and by the market in general. So a case in point, the amount my claimed was €28,000 Santander has taken this all the way up to the Supreme. Just in lawyers' fees, Just in lawyers' fees, the amount to be paid is much less than what has been paid to those lawyers.
So if you extrapolate to €1,000,000,000 we will see that the bank will have to pay over €2,000,000,000 and the bank knows it will have to pay for that. So please, Ladies and gentlemen of the board, do not do what ostriches do because the problem will only get worse. And when you want to react, it will be too late, and the bank will be cornered. It was in your hands to avoid this. Tempus, temporis.
Thank
you very much, Mr. Shareholder. I give the floor now to Mr. Luis Ollos Perote. Good day.
My name is Luiz Ollos. I am a shareholder. I'm from Cantabria, and I am have been a customer of Santander Bank for many years. I wanted to ask you that in all the AGMs, you always talk about how important diversification is and geographical differences and presence of the bank with the footprint in many countries. I confess that when I travel abroad, and that is very often, I'm very pleased to see the amount of new branches that are being opened abroad and how much the bank is growing abroad.
Now what really concerns me is the profitability of that geographical expansion outside our borders. Is that profitability will remain the same? And if so, How what are you doing to increase that profitability so that all those businesses that we have abroad and other geographies are truly profitable for the bank. On the other hand, I would like to ask If you are going to continue with the dividendo electron, which I think is a good choice. I like it.
Are you going to continue with our policy? That is all. Thank you. [SPEAKER UNIDENTIFIED
COMPANY REPRESENTATIVE:] Thank you, sir. And now the floor goes to Pablo Hernandez and Trapaga. Good morning, Madam Chair, members of the board. The more recent results of the bank show that Profits are good in Latin America. But furthermore, in the report, I have read in the chair's letter that countries such as Mexico and Brazil, there are micro loans, micro credits to persons who have very low income levels.
This is great. This speaks well of you. But as a shareholder, I wonder how do we strike a balance? Because we understand that those persons who have less are certainly assisted by these types of products. But is this good for the bank and for shareholders?
Thank you, Mr. Shareholder. I give the floor to Ignacio Bellia Muguruza. Hello. My name is Ignacio Bellia Morogorroza.
I own 13,378 shares. Madam Chair, Directors, first of all, I want to congratulate you for meeting the plan of the last 3 years. And I wish you lots of luck in order to meet your targets set in the new plan because if you do well, we would we will do even better. I wanted to ask you about the share capital of the group. I know that after the crisis, all banks are now forced to have more capital to avoid cases like Bankia happening again.
And I do know that the capital target was one of the priorities of your former engineer plan. That is why I would like you to explain the developments in terms of capital specifically and if we shareholders can feel comfortable or if we will have to ask to be asked to contribute again. Thank you.
Thank you, Mr. Shareholder. Good morning. I'm sorry. I was out in the dog house, and I had to run here.
I have to say hello to Albank employees. Hello to managers, directives, executives, members of The board, Madam Chair. Now we talk about social management. I want to say that I want To address the following issue, I would like you and the entire board to be removed from your positions, more especially yours, Mr. Benjumea and Mr.
Eshinike. I would like you to be removed. The last time this meeting was held, I addressed a fraud to the 250,000,000 because of the sale of the Mijas development. And you have done nothing for those 50,000,000 to be returned. And that is because the parties accountable are members of the executive board.
You do not do what you should be doing. You do not defend the rights of shareholders. You defend your rights and those of your men at arms. So it is up to you to ensure that you and those persons I have described be removed. But that would not be the only reason why I request that you be removed.
You are abusive. You want to have as many votes possible in order to ensure that your recommendations are carried out. And you have asked an ordinary to not account for those delegations which are spuriously captured in detriment of those who can do nothing about it. And you also make use of delegations or proxies in the case of conflict of interest. You delegate into a delegation, I am going to be bringing that case to court as well.
Mrs. Butin, you, Unfortunately for shareholders, nobody wants you at the head of the bank. The shareholders, the markets, The Financial Times actually criticized your designation and proof of the pudding is the price of the share. It has been a tumbling down. Over 40% has been lost.
And what about Mr. Osell? The excuses for that non designation are to be believed by no one. You would not be paid anywhere else in the world, even onetenth of the €11,000,000 that you collect every year at the Banco Santander, especially when we shareholders have invested over €500,000,000 in order to ensure that the bot team continue to be at the head. Only €300,000,000 have been used for Mr.
Korcosdegi And Mr. Amos Atigi hand over the reins to your power. Mr. Kokosti was 51 at that time. He received €100,000,000 to pave the way to all of yourselves.
And We've seen recently something published which we knew of, the acquisition by Santander of political and judicial issues. We have heard about a member of The Socialist Party having addressed the issue of having solved Mr. Botein and Mr. Shaniqua's problems, the so called Botin doctrine. They were not jailed because of that tax fraud.
But Santander, for years, sold over a number of years, 1,000,000,000 to Madoff, although the entity had 3 reports from employees spelling out that this was a scam. This was a Ponzi scheme. So Mrs. Botin and shareholders, please explain to everyone your visits to Mr. Madoff In the lipstick building, why?
And your defense of Madoff, you defended him fully aware of the fact that Madoff's products and results were the result of a full fledged scam. Mrs. Botein, your life is like an image campaign. It will only serve you to shine in your financial funeral because we do not want to continue to have you in that position. We know What the readings are in the U.
S. And in the U. K. We know about the collaboration in tax rod because of the dividends in Germany or the Popular case. Mr.
Shareholder, your time is up. I am allowing you one more minute. What is the image of the bank? How is the bank perceived when its chair is involved in the HSBC Switzerland? Think about Ray Dalio, who is a multimillionaire, but he believes that he should be paying more taxes.
And Mr. Matou, as a member of the board, when he was with the BNP and currently being investigated for possible money laundering in Switzerland of the millions of the Botein family. And Mr. Ben Jumehan, who is also Mr. Shareholder, would you please come to the end of your comments?
Mr. Eshanike, of those criticisms, Mr. Vijayar Mir, who fortunately has left the board, those Mexican scandals. And Mr. Munson, your friend, who had to leave Intra because of the losses.
Mr. Shareholder, your time is up. Thank you so much. I request Your removal and I request also that social action of responsibility, the entire board. Thank you very much.
Mr. Shareholder, your time is up. Thank you.
I give the floor to Iker Miranda Serrano. Hello, good day. As an entrepreneur and as an owner of 9 shares, I started working in an industrial company. I started from the bottom as an IT technician And now I am Chairman. But like many other companies, because of low demand during the crisis, We had to close with 133 employees 5 months without getting paid.
And these are very difficult situations, which made me take the decision to become an entrepreneur myself. With a project and with capital, we look for financing. But we were encountered with a very difficult reality. No institution would finance anything without any personal guarantees, although That was, of course, something that was very difficult to overcome. So we got in touch with the Vitoria Santander branch, And we met her its manager, Yasmin.
She looked for a solution for us. The bank would work to look for those guarantees. And that was almost the dream of any entrepreneur finding a single window to get all your problems solved. So she, the branch manager, got in touch with an organization that lend us the collateral that we needed. Thanks to your support.
We were able to make our project come true. It was a real solution for us. Obviously, the other 3 institutions, once we already got that guarantee, we also wanted to participate in our project, those banks. But the work done by Jasmine, and nobody else did for us. No other bank could.
And so in this life, apart from education, as the Chairman said, Effort and work, you also need to be luck. Lady luck has to be with you. Some people have it, others don't. My parents had no education, and they made every single effort they could to make sure I got an education, but we were missing luck. With the help of the bank and with the help of Yasmin, the branch manager, I was able to build an innovative and exclusive product in Europe.
What I want to say is that this proves that the image conveyed by the bank has very little to do with reality apart from salaries and premium and all these other news that we hear about. Santander truly makes an effort to help people and make their projects come true. Apart from this technology, social media and the use of big data to have repercussion. I'm sure the bank does it and has enough means to do so. It is necessary to reach people and look for solutions as Jasmine did for us.
And all this story is to tell you that I have an idea why not have a single shot window Single shop window. For entrepreneurs, you already did it for me. Being an entrepreneur is very difficult. Why not reach agreements with with chambers of commerce and other institutions to promote the funds that the bank has for entrepreneurs. Many entrepreneurs, when we have an idea for a project, whether it is voluntarily or forcefully because the companies where we work for had to close, we go to these institutions when we have a project at hand.
And they give us a dossier like this one where they explain to us all the subsidies and lines of funding that an entrepreneur has to carry out his project. We must take into account that the digital banks are right around the corner. But Santander has something that the others don't have. You have people who look for solutions. I think it would be very positive to the image of a single window, a single stop, single point where people can get helped to do their projects.
You already do it, more or less. And I want to congratulate you. Thank you for the excellent people you employ. And to finish, I would like to thank you for allowing me to be here with only 9 shares that I own to present this proposal. And please never
Thank you very much. Thank you, Mr. Shareholder. And I could not agree with you more. On behalf of the 200,000 employees, All of us in Santander, thank you for your kind words, and I will afterwards react to your proposal.
The floor goes to Jose Ignacio Ubillavolado. Good morning. I am Jose Ignacio Villavolado, and I am here today with a very straightforward question. This is something that I think is very important for all of us here. Madam Chair, what does Banco Santander want to do with dividend.
Thank you for your answer. And I hope I truly hope that the bank achieves everything. I hope that everything goes well for the bank and us, the shareholders. Thank you.
Thank you, Mr. Shareholder. Next, I give the floor to Mr. Enrique Sebastian Molina. Good day, Madam Chair, ladies and gentlemen, members of the Board, ladies and gentlemen, shareholders.
I am addressing you as a member of the armed banking campaign promoted by CETEM, the Center For Peace studies, the Observatory of Debt. I am speaking on behalf of 24 shareholders that for the 10th year in a row have been delegated with many shares to come once again to this meeting to complain about the investments in arms that the bank is doing. We have the Center for peace studies, and we have identified 18 companies that build weapons that have been financed by Santander Bank for a total amount of more than €2,400,000 All of these are companies that based on their commercial interest overlook the terrible consequences of produced by their products. They're exporting weapons to the North of Africa and Far East. They contribute to the escalation of conflicts in these areas and put at risk the lives of people who live there and many people have to flee their countries.
In the last few years, forceful migration, well, it has risen considerably. This is a drama that nobody can turn its back on. And we want to dedicate this intervention to 2 specific examples, which show the complexity of that Santander has to do with all these terrible happenings in the world. In 2018, Vaca Santander financed by more with more than €54,000,000 Indrac company, 20% of its production is and it controls 80% of the Spanish missiles. Also, it is one of the main companies responsible for building the wall Spain and Malia and Morocco and Telta and Morocco.
Then the second example is a company like Santander from 2013 has received from Santander more than €165,000,000 in credit. Maxam is one of the military companies, one of the largest in the world. In the past, it was responsible for cluster bombs, but it had to stop production when their production was forbidden. Maxime also sells explosives to Saudi Arabia. And I think it is obvious for anyone in this room that the regime does not comply with the treaties on human rights that Paco Santander say they follow.
It is no secret either that Saudi Arabia has been involved for many years in the war in Yemen with thousands of deaths ever since Saudi bombing started. And these are just a few examples. Sadly, we can continue to analyze the other weapons or arms companies that are financed by Santander and that infringe human rights. So, chairwomen, Shareholders, please face up to this reality that we've been talking about here for more than 10 years. It's not every It's not only growing and making money.
We have to see at the cost of what we're growing and making money, be no longer part of the problem and become part of
Thank you, sir. The floor goes to Nuria Garcia Castellon. Good morning, Madam Chair, members of the board, ladies and gentlemen, shareholders, I speak as a member of the campaign, Vanka Armada. A number of different NGOs are involved. A number of acronyms have just been read out.
I speak on behalf of 24 shareholders who have delegated a total of 75,173 shares. We want to be heard today. We want to denounce investments in nuclear weapons, which the bank continues to carry out. You said last year, ma'am, that the team of Banco Santander takes into account social and environmental aspects whenever investments are to be made. This is the 10th year running that we speak out.
This bank continues to be one of the leading to invest in nuclear weapons manufacturing. The total invested as of 'thirteen is of €2,400,000,000 This is according to a research center. Banco Santander is the 2nd Spanish bank But most events in these lethal weapons, despite your guidelines where it is established that your banking entity will not have any kind of a commercial relationship with entities that participate in anything related to weapons. We know that you have financed the following organizations: Honeywell International. This is one of the companies that is most involved in nuclear activities, practically €130,000,000 Leonardo, for the development of transportation of missiles, EUR 180,000,000 Boeing, Flor, Thales, these are some of the companies that manufacture and export nuclear weapons, which have also benefited from loans and credits As you can see, Mrs.
Botin, we are concerned about the dangerous relationship between Eurobank and companies that manufacture nuclear weapons. This is especially worrisome in the current scenario after the U. S. And Russian governments have announced that they are going to be withdrawing from the mid range nuclear weapons agreement, an agreement which during the Cold War was very useful. The consequences in terms of human lives lost, The effect on the world would be tremendous.
The effects would be much worse than what we saw in Hiroshima and Nagasaki during the Second World War. So members of the board, ladies and gentlemen, Do you not think the time has come to no longer finance these weapons of mass destruction as other banking entities and financial entities have done in Europe? Ladies and gentlemen, shareholders, if all you want is to grow your dividend, continue to invest in the weapons sector. But you must be aware of the fact that this lack of responsibility has all of us, including yourselves, living in a world which is less and less safe. Be aware of the fact that civil society and especially our campaign will continue to remind you and The rest of the armed banking sector.
Mrs. Butin, we ask you and all of the parties present to leave today and for good behind you the funding of companies that build nuclear weapons. Thank you for your attention, and we really hope not to have to come back next year.
Thank you very much, Mrs. Shareholder. And now I give the floor to Mr. Manuel Alejandro Villarubia Cortez, Good day, everyone. The first thing I wanted to do is make a remark on What the colleague from Ciudad Real said that he had to sit in the adjacent room and not in the main room.
I come from Madrid. I called the line for shareholders The second day that the Affirmity was convened and I'm sitting at the back too. So I think I have half of the shares he has and I'm sitting in the main room although at the back. So don't worry. I mean, it's just a matter of luck, I guess.
So next, I'd like to agree with what Mr. Bruce Carnegie Brown said about not hiring as a CEO Mr. Mr. Arcel, not hiring Mr. Arcel.
I agree with what Mr. Carnegie Brown said, particularly when he said The philosophy of the bank is not to spend so much money hiring an employee. I fully agree with that. And regarding my questions, And I'm really surprised nobody has asked yet about this, and that's Brexit. The U.
K. Is a very important country, For the bank, it is a country that is in turmoil. We don't know very well what is going to happen. The chairwoman was living there for several years. So I'm sure she knows much more about the situation than we do.
And I'd like to ask her, how do you see Brexit? What do you think is going to happen? And do you think that we're ready for whatever may happen? That's all. Thank you.
Thank you, sir. And the floor now goes to Mrs. Natalia Perro Perez. Thank you so much, ladies and gentlemen. I'm Natalia Perro, Secretary General of Caritas Spain, and I represent the shares that belong to this entity.
Thank you to Madam Chair. Thank you to the members of the board for having made it possible that we be here today, the President of Caritas Espagnolo, Manuel Vuitton and myself. And thank you also at this point in time, all of the persons, all of the employees of the Banco Santander, all of the employees of Caritas who make it possible for this close working relationship between Banco Santander and Caritas actually being something of import. Definitely, it is very important for Caritas. We have alliances with companies and institutions, which ensure that our activities make a difference for those who have leased.
We also can talk about the causes underlying poverty and exclusion, and we can jointly look for long lasting solutions and we can carry out the kind of social and economic actions that truly do generate opportunities for these have nots. Caritas is the church and thus has 6,000 parishes and another 1,000 venues, 70 of which are here In Santander, in Cantabria, we also have a presence, thanks to our international network in over 160 countries. These doors are opened, but not only to people who want food or clothes or the payment of people who have no jobs. We work with people who have no homes. We work with people who are victims of trafficking in persons in Spain and in other countries, thanks to Caritas, the world over.
So in a nutshell, As we've said on other occasions, we in Caritas also work for people and with people. Thanks to our territorial structure, Our organization also encourages the establishment of centers where these persons can get together. We work with them in order to share and generate legislative changes, changes of all kind that will make their lives easier. CARITAS Spain relies on 80,000 volunteers, 4,000 employees and the support of donors and institutions, Institutions such as the Banco Santander, which have allowed us last year to establish 37 companies among other initiatives. All of us are committed as well as those 3,000,000 persons who were assisted by us in Spain and abroad last year.
€354,000,000 were invested, and the private contribution was of 73%. And finally, now thank you again for this collaboration. But let me underscore that these are different times. These collaborations have to grow. And the commitment that we request of yourselves, of the board, of the chair is to help us explain that this commitment exists to the partners, donors, workers, customers, collaborators, with each and every one of the companies involved because we believe that these companies are where persons are who may commit.
This is where the engine of change is for a society that needs a change. Thank you all. We can talk about dreams come true, initiatives underway and lives rebuilt. We count on you. We thank you for your commitment and appreciate the time you have allowed us.
Thank you.
Thank you, Madam
Shareholder.
Thank you so much. The growth of your business in generating for your shareholders is important, but not at any price. I'd like to congratulate you for the new challenges that you've set for yourselves, although MetroMed is an excellent necessary initiative. It is important that large companies like yours set the example and commit to reduce their impact on the environment. Apart from what you've already said, my questions are as follows.
What are transactions are you doing today to favor sustainable development. How does that fit with your strategy? Thank you very much, and good day.
Thank you very much. Thank you very much, Madam shareholder. Does any other shareholder wish to take the floor? Participants that no more contributions are to be accepted. We now are going to watch a video, which we hope is of interest.
Thank you. The floor goes to the secretary to report regarding modifications and amendments in the bylaws as agreed and this as of the last meeting. I inform you that the Board met on 26 February 19 and agreed to a number of modifications, articles 5, 6, 13, 16, 17 18, 19, 20 T1, 2022, 2026, 2029, 30 1, 30 2 and 30 3. These amendments are with the aim of modifying some aspects incorporating best practices and some changes which result from the modification of trade law and capital companies laws of 18 December and the technical guide onenineteen of the CNMB regarding Remunerations committees. Among them, the modifications include the following: to establish that the audit committee is made up exclusively by independence and strengthen its task regarding non financial activities.
Also broaden the nominations committee assuming tasks which so far only corresponded to the BRC. I expressly set forth that the lead director will be the director of nominations committee. Also, the remunerations and nominations, including the following entities determine that different personnel will participate in responsible banking, sustainability and culture and innovation and technology and the collaboration with Leach 1 as well as forecasting presence of any person who is not within the group but who should be. We also believe that this should be made up of independence and presided by a member of the Board of that nature. Also, the member will be a member of all of the committees.
These were duly introduced into a writ, March 2019 and have been included on March 18, 2019. Further, We hereby recommend that Page 150 of the individual accounts include sanctions that were imposed during 2018. And we have seen sanctions or fines for these noncompliances, Law 2688 regarding the carrying out of forbidden acts with regards roundings And Article 19.2, which has to do with pre contractual and settlement in mortgages which will be published in the official state bulletin owned by the Bank of Spain with regards legislation in force. And as to issuing bonds, other values, including warrants and convertibles into shares which have been conferred as of Article 10A of the Board of March 27, 2015. We hereby report that it was agreed on February 4, 2019 to issue preferential shares, which may be convertible into ordinary shares, new issuance.
Said issuance was carried out by means of that The corresponding information as provided and the exclusion of the rights to preferential subscription and the corresponding report With regards to the reasonableness of data included in those reports and the suitability of conversion of those forms in order to prevent a possible dilution of shareholders were incorporated on February 7, 19, onto the bank's website and as of then are available to shareholders at the offices of the bank. They may be visited, and they are available at the notary's desk.
Next, I'd like to answer the questions from the shareholders. The shareholder Monica Delgado Fernandez, who asked whether we are satisfied about what we've done in the last 3 years if we feel comfortable that this performance of the bank will continue. As I said in my speech, We have met all our financial targets that we set for ourselves 3 years ago. The reason why we think that we will continue to comply with our targets is that because we have achieved these results in a sustainable fashion, we've done so by growing the number of loyal The number of digital customers has doubled to 32,000,000, and we have achieved well balanced growth, we've grown our revenue. We've also improved the return, and we have strengthened the capital base of the bank.
Therefore, We are very comfortable and we are very confident that with the great team we have in the we will continue to comply with the plan that we presented a few days ago. The next Remarks were from Maria Teresa Chari, who asked well, she asked about the dividend And how important the dividend is for minority shareholders, believe me, we are aware of this importance. We give dividends top priority. We have increased it by 4.5% in total and the cash by 9% if, of course, this AGM approves it. That's EUR 0.23 out of which EUR 0.20 will be paid in cash.
That includes The scrip dividend that the shareholders have decided to collect in cash, EUR 32,000,000,000 And we will continue to try, as I said earlier, to increase the dividend in the future. The next remark was from Julien Arana Gandeta on Latin America. If we will continue to grow in Latin America, if we're concerned about instability and also asked about the acquisition of minority stakes in Mexico. All countries have ups and downs. This is not something that only affects developing markets exclusively.
We also see instability in develop the markets more and more, particularly on the political side of things. And therefore, that is part of the business and it is part of our work to anticipate and manage the banks in good and not that so good times. And I think as a proof of what we're able to do, we've had 3 very difficult years in Brazil. And in that period, we have by 2 double the profit of the bank there. It's not always possible to do things that well, but we are ready to face instability.
Regarding the acquisition of minority stakes in Mexico, we think it is a very good deal right now. Mexico is a country with huge growth potential And we're always thinking about the midterm. We're in Mexico to stay, and we think that this is the right time to do this deal. And as I explained, it is good for the shareholders of Santander as well as for the Santander Mexico shareholders. And the next remark was from Mr.
Manuel Huerta Teran, who asked about the CEO, the Chairman of the Appointments and Remunerations Committee already in his report summarized what the process was like and how decisions were made. It was very difficult decision, but the right one in the opinion of the Board for the shareholders. And we had 2 long meetings, one in January when we announced our earnings. And then also in London, a few days ago in the Investor Day, on those two occasions, We were not asked a single question about this issue. And the investors showed that they continue to trust the managers of
The following speech was by shareholder Anna Barreiro Lopez, who asked about the Banco Santander policy and other issues regarding coal and the environment. We are fully committed, and I have said that this was, in fact, one of our priorities As a responsible bank, we want to contribute to the orderly transition towards low carbon economy. Our policy is to back our customers throughout the process. And this is important because we bear in mind the social needs of every country because not all countries are equal. Not all countries can advance at the same speed.
And what is very important is, of course, to roll in the same direction. We are very careful. And every year, we study our policies, our energy And our metal policies, for instance, address the issues of efficiency and emissions that projects must satisfy, The shareholder mentioned, and those are the data. We request for existing customers that The approved transactions notably improved the environmental impacts and the bank track report, which you referred to about banking and climate change, has Santander being the 3rd bank with the least activities that have do with fossil fuels among the 33 banks analyzed. We are stricter with regards to coal related activity, so we are not going to finance any new project of central plants that are that run on coal or mines.
We are very active in terms of renewables. In 2018, we are the bank that participated in most transactions the world over, project finance for renewables. And we have contributed to funding renewable energy projects with a capacity equivalent to 5,700,000 homes. So we think that the best way of contributing to this phenomenon, which we agree I agree is an absolute priority for all of us is by backing innovation and backing our customers as the transition takes place towards a new economy. I said that we have established a new committee, which is going to deal with this specific issue.
As of 2,001, we've asked about The environmental footprint, yes, we do measure it as of 2,001. As of 2011, the group has a number of different plans for Energy Efficiency and Sustainability. And as of 2021, we will be avoiding single use plastics in every single one of our buildings, and we are going to increase the use of renewable energies. In 2025, also, we want to achieve this in as many countries as possible where we can guarantee the origin of the energy we consume. And we will continue to set increasingly ambitious objectives in line with the demands that society makes us aware of.
We have been asked about projects that will be financed. In the case of some clients, for reasons of confidentiality, we cannot talk about specific customers, of course. That's privacy legislation. I think that I have answered all of those questions. Then Guga Goebolevsky, I believe that I have just responded to all of the questions and comments which were made.
I have grouped them together. There was Clara Pardo's contribution from Manos Unidos. She asked well, 1st and foremost, thank you for your kind words. Let us assure you that we know that By working with organizations as your own is one of the best ways possible of contributing to society and to the communities where we have a presence. There are different criteria.
Things are not the same everywhere, but in Spain and in the U. K. For instance, our criteria is that of branch managers, regional managers who recommend specific projects in which to participate. We also have a program, which is very popular, which is called euros from your payroll. We, employees, contribute to projects which are voted.
And the more popular ones among employees, well, that's where we contribute. What the Employee contributes is matched by the bank, and what we do is ensure that projects that we have participation in be managed efficiently and rigorously. In 2018, apart from the bank's contributions to higher education, €179,000,000 We contributed €58,000,000 group wide to projects of this nature and that the world over. Mr. Calzado, I answered.
Mr. Martin had a number of questions. Well, firstly, that in time, when the time came to amortize or not, we would abide by economic criteria, which is what we did. As to responsible banking, I agree with you completely. This is something we need to talk about more and better.
Again, we have a board committee, which is going to help us to further delve into the issue. And what do we mean when we say responsible banking? Will every one of the 200,000 employees of the group every single day, every single day do things right. We're measuring this. We're going to continue to measure it, we will be increasingly demanding and doing things the way we should, simple, personal and fair for our There is going to be no change in the bank strategy.
We said that before. We repeat it now. And the CEO is going to be in that position indefinitely. As to your question about German banks, we are not interested. I think that was the question that was asked.
And the next shareholder was Alvaro Vicina Mujica, who asked about taxes. Taxes are very important. Again, being responsible means that you contribute wherever profits are generated and in accordance with legislation in place. I would just say that in 2018, we paid 7,500,000,000 in taxes, of which 3,400,000,000 correspond to corporate tax and the difference nearly 3,600,000,000, That is contributions into the social security system. Spain represents 18% of group profits and in Spain, it was €1,700,000,000 of which 474,000,000 were corporate tax.
Another question was posed about the integration of Popular and the question was also Post about the art collection. Is the art collection going to come to Pareto? Yes, it is. We want the bank's collection to live here. And about the integration of Popular, it was very important To address the concerns of the millions of customers, there was an ongoing conversation.
They now can access ATMs, a much larger network than before and products and services are available to them, which before they had no access to. Now Mr. Manuel Archanta, who had a number of questions. The first, if everyone is a shareholder here, In the hall, there is a majority of shareholders, but there are also some guests. There are executives.
There are employees. As to the integration of So far to date, we have integrated Central Services, the branch network, Cantabria, Asturias, Galicia and the Basque Country. And as to the organizational structure of the bank and what it actually represents For private parties in Spain, well, this is actually important for all shareholders, Spanish or not, for all customers. What we want to do is execute as quickly as possible, be more profitable, provide better services, do something which we are already doing, which is collaborate among the different units. We have best practices everywhere.
We are working along these lines. What it means to be a part of the group in terms of savings for 2018, but we want to do more, not only share. We want to do things together in operational terms. We want to build the business. We're looking to the future.
We believe that this will be good at the end of the day, not only for shareholders, but also for customers. That is why we work. That is our objective. The question about buyouts and rules in place, This is very important that we want to attract talent, giving shares to offset the losses in remunerations in previously held positions. As to the plan that you saw in the report For employees, that special U.
K. Employees plan, yes, you're right. But we have incentives in Spain different from those in the U. K. In the U.
K, it's included in the report because it has to do with share acquisition. As to agreements reached at a board At this venue, are there changes? Are there adaptations? No. But technical adaptations need to be implemented so that they can be included in the official documents.
The next shareholder is Francisco Javier Martin Sanchez, again asked about the bank's strategy and the market in Europe and in Spain And about the evolution in the share price. About the shares, I would say, firstly, We understand clearly, as board members, as shareholders, that at the end of the day, the market Prepares a report card, but there are three thoughts to bear in mind. We live in a market economy, and what you want is to be number 1. But We have to play the game wherever the game is called. So we are back number 1 in the euro zone in terms of market value.
When We began this plan, this 3 year plan, the new plan. The difference visavis2nd was tiny. Now the distance is 30% in terms of value. Secondly, so far to date, Profitability is close to 15% if you compare with 12% for European banks and total returns Because at the end of the day, this is very important also. We have guaranteed 13%, which is much more than the European Bank Index.
And then another thing that we can control is what we do and results. As I said, We made good on all of the promised results included in the 3 year plan. But to summarize, what the bank has done over the past 3 years and Shares do not reflect that share price does not reflect that as we've grown our net profits by 30% as of 2015, we have strengthened capital by €18,000,000,000 Apart from other instruments, subordinate instruments, and we have improved profitability from 10% to 11.7% last year. As I said before, we do things the right way, and we guarantee that these are sustainable results. So if we look to the future, We are confident that we will continue to achieve these good results, good results for everyone involved.
And another point which is important is that the market, The stock market is complicated, especially for European banks, for Europe. And that's why I talked about Spain and Europe because this affects all of us, the shareholders of the bank, and it affects the bank because at the end of the day, What analysts do is they put it into the European Bank's drawer. This is important. Europe, as I said, there are political uncertainties, not only in the U. K.
We have negative interest rates. There's a series of facts which explain that European Banking at this point in time is not well assessed, and this is something that does not depend on us. We are one of the European banks that has a recommended buy at this point in time, and we hope to be further differentiated into the future.
Following question was from Maria Carmen Gracia, who asked whether the return of the bank is enough For the shares to continue to improve, she was also interested on this point. The return, as I just mentioned, of the bank has improved great deal in the past few years and has improved with much more capital. Obviously, that is even more difficult from 10% to 11.7%. And we've also improved the dividend significantly. As I just said, this year, the Cash dividend will go up 9% per share.
The next remarks were from Mr. Birbalero Quirox who asked about the dividend, too. The dividend ever since the capital increases that we've done in the past few years, Those who bought shares in the capital increase of January 2015 have received until now €1.15 per share. That is the equivalent to 18.8%, which is not bad at all of their investment in the last 4 years. Those who bought I also bought in the June 17 capital increase, when we acquired Popular, have received a total of EUR 0.45 per share.
That is the equivalent of 9.3% of their investment. That's in less than 2 years. Return on the subscription price was 4.85, I remind you. The next shareholder, Mr. Javier Lanta Serrano, who asked A set of questions.
In terms of the share price, I already answered that, but he more specifically said against the tangible book value. Today, it's onetime. Many of the European banks at our 0.6, 0.5, This is what the market is valuing Spanish European banks today. I remind you that shares go up and down. It was 7 a few years ago in 2014.
And then it reached almost 7 in April 20 Today, as I explained, we're making more money. We have more capital. We have improved our profitability. We have more sustainable earnings. And the market gives us a 4% in share price.
So that reflects the perception of the market of European banks. It is important that we are aware that banks are important. That's why I said it in my speech that they everyone should appreciate the role and mission that banks play in Europe. Now I'm going to refer to your questions on the Popular Bank and the intervention. In terms of the resolution process, It was the single European Resolution Board that agreed to resolve Santander sorry, Popular.
Santander followed the process of the authorities. It was the Popular Board that decided that the bank was not viable, that we ourselves were able to verify the situation of Popular, we had to inject that EUR 30,000,000,000 in liquidity, and that is part of the euros of the capital increase. These decisions of resolving Popular were measures adopted by the European competent body, the European Single Resolution Board. Now the popular customers, we are making sure, receive the best service. In terms of the loyalty bond, that we launched a few months after, That was done for only commercial purposes.
It was not a measure to avoid lawsuits. These bonds were offered only, as you know, to shareholders and holders of subordinate shares of Popular, who were also customers of the Santander Group in Spain, and they had to fulfill certain requirements because we were looking to lock them in to make them loyal customers. The criteria to benefit from the bonds were very clear and transparent. And And I am aware that every case was studied individually to make sure that all the customers received a fair treatment. Customer of the group that had invested less than $100,000 in the group shares has already recovered 80 percent of their investment if we compare their investment to the current value of the bond.
And the acceptance was 78% or the take up 78%. In terms of the question about the auditor, The auditor of Santander appointed before the acquisition of Popular had a contract until 2018, And he followed the applicable regulation, and his work is not affected by the work carried out in the Popular by other teams from the same firm. In terms of the litigation provisions, they are in note 25 of the annual report. And in the opinion of the Board, the provisions for litigations are enough are sufficient. Also, they asked about the arrangement fees.
In terms of the expenses on mortgages, I remind you that have a mortgage that is one of the best functioning in Europe. It's been very important to the success of the Spanish economy. In the last 10 years, the average interest on mortgages in Spain was 2.23%, which is almost half of the EU average, which is 3 This is data from the Bank of Spain and the ECB. 70% of households own their own home, And that was the starting point for many small businesses in Spain. In terms of the question, well, the bank considers that the arrangement fees that we have charged have always been legal.
In line with the guidelines of the Bank of Spain, the Supreme Court has ruled against having to pay all the expenses, but that does not mean that the bank has to take on all these expenses. This stamp duty is paid by the customer following the doctrine of the Supreme Court on November of last year that the duty stampede has to be paid by the customer and not the bank. And in 2018, it is established that for future operations, the tax has to be paid by the bank, and that is how we have been doing. And we are dealing with claims according to the criteria set by the courts and each case's circumstances. In terms of rulings in favor and against, the shareholder mentioned a ruling against.
Well, there have been rulings in favor, others against, Of course. And I think with that, I answer all the questions on that point. In terms of floor clauses, they only affect the Santander since the acquisition of the Popular. We've already established the required mechanism to provide a response to the situation. Popular eliminated its mortgages from their mortgages in January 2016, although from 2013, it did not have any clauses to the new mortgages.
And these, we think, were legal because they were solved with transparency. The decisions of the courts are not being contrary, Generally speaking, they are taking into account the specific circumstances in each case.
As to appeals, I think I've answered all of Javier Blanca Serrano's questions. Mrs. Anna Sabrero also talked about accounts, Reliable accounts, of course, our accounts are reliable, yes. As to appeals, well, we take whatever decisions are appropriate on a case by case basis. I think that I have answered the questions posed by Ana Sombreros.
The next shareholder was Mr. Julian Garcia Caballo. He asked about talent and diversity. We are 200,000 employees, as you rightly pointed out, And what we are doing to recruit the best possible talent, which is key to our success, Well, first, we work hard with regards to culture. We want to have the kind of a culture where people want to work.
We want to be one of the best places to work in those countries where we have a presence, and we are successful in 7 of the 10 countries where we have a presence. And we are currently looking not only at achieving financial objectives. So it's not only about the numbers, and of course, numbers are very important. But with regard to incentives for the team in general, how to achieve those objectives? Again, This is something that allows us to attract the kind of people we seek to attract.
And yes, diversity, not only gender, but All kinds of diversity are very important for the board and for management in general. We are doing our utmost to speed up this change to be a more diverse team. As to the presence of women, we have mentoring programs in place. In a number of countries, we actually have a specific requisite that wherever there is going to be promotion, we need to have gender diversity, even if this has us recruiting from outside of the bank. And we have set forth as I said, we have set forth that on the board, we want to have between 40% 60% diversity, this by 2021.
And then Mrs. Carolina Rueta From the Brown Bear Foundation, unfortunately, our friend has gone who loves bears. We're going to continue. But as I say, it's our teams who have the last say, so it's wonderful that we're close by. We want to be there in our branches.
We continue to back up. And I remind you that We had only 80 bears. Now we have 340 bears. The president of this region of Cantabria is passionate about bears, so it's a shame that he left. We're delighted to contribute to your project, ma'am.
Now Miguel Angel Vasquez, who asked a number of questions. Well, I think that we have dealt sufficiently with share related issues. We do not control the markets. The markets have their own life. And the problem now is that Europe is not fashionable.
European banks are not growing. And we are a European bank, but we have a presence in the Americas. And this exactly what allows us to continue to generate results throughout the cycle. We are going to continue to invest, as we said. We're going to be rebuying back in Mexico.
And as to Our members of the board, remuneration issues, The board and the remunerations committee tracks this very closely. The Sum total in the short term has grown by 6%, whereas group profits have increased by 7%. But I would add that total remuneration represents 0.20 of profits. In 2015, it was 0.28. And I would add that we do track this very closely because we want to ensure that compensations and remunerations are aligned with the market.
And we have introduced major changes. A goodly portion is now deferred and is subject to midterm plans. So if the plans are not these numbers will be reduced. And a goodly portion actually now is in bank shares. So we are perfectly aligned.
And this is not only for executives. This is not only for directors. This is for all of top management. This is, as I say, we are tracking the bank and the bank's performance very closely. As to the scrip and minorities, I think he said that he liked script and asked about that.
Well, when we just announced a couple of days ago in January when we talked about results, Well, we said that we want to continue to use the script, but We also are