Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 563

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 563
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 management and across the Group according to established governance. For this purpose:

• defines liquidity risk and provides detailed measurements of current and emerging liquidity risks;

• sets liquidity risk metrics, and reviews and challenges risk appetite and limits proposed by the first line of defence;

• assesses and challenges commercial and business proposals, and gives senior management and business units the information they need to understand Santander’s liquidity risk;

• oversees the first line of defence’s liquidity risk management and measures how long business will remain within risk appetite limits;

• reports to governing bodies (risk control committee, RSRCC and board of directors) on compliance with risk appetite limits and any exceptions;

• provides a comprehensive overview of our liquidity risk exposure and profile; and

• makes sure that liquidity risk procedures are appropriate to manage the business within risk appetite limits.

The market remained stable throughout 2024. Debt markets operated under normal conditions and we achieved our proposed financing targets. Additionally, our subsidiaries have a sound balance sheet and stable funding structure, supported by a large base of customer deposits, low dependence on short-term funding and liquidity metrics that are well above local and corporate regulatory requirements and within risk appetite limits.

3.7 Key liquidity risk metrics

Our solid liquidity position stands on a decentralized model under which each subsidiary manages its own liquidity autonomously. To measure liquidity risk, we use tools and metrics for the right risk factors. We follow the guidelines set out in the Capital Requirements Regulation (CRR) and the Capital Requirements Directive (CRD) to draw up liquidity risk metrics. We determine liquidity scenarios for internal metrics based on the behaviour of other banks in liquidity crises, regulatory assumptions, and expert opinion.

These are our core monitoring metrics in the Group:

A) Regulatory metrics:

a. Liquidity coverage ratio (LCR) assesses the short-term resilience of our liquidity profile by making sure we have enough high-quality liquid assets to withstand a considerable market stress scenario for 30 calendar days. In 2024, the Group’s LCR remained stable and well above the regulatory threshold.

b. Net stable funding ratio (NSFR) measures long-term liquidity risk. It is the ratio of available stable funding to required stable funding. In 2024, the NSFR of our core subsidiaries and the Group remained above the regulatory requirement of 100% and the internal risk appetite.

B) Internal metrics:

a. Liquidity buffer assesses whether liquid assets are enough for the bank to survive for set time horizons under several liquidity stress scenarios.

b. Wholesale counterparty concentration metric measures the