Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 826

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 826
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 and particular circumstances. It assigns a monitoring level, specific management actions, identification of those responsible and a monitoring frequency. In addition to monitoring customer credit quality, Grupo Santander defines control procedures to analyse portfolios and performance, as well as to detect any deviations from planning or approved alert levels. 1.5. Credit risk mitigation techniques Grupo Santander generally approves risk according to a borrower’s ability to make due payment, regardless of any additional collateral or personal guarantees Santander may require to modulate exposure. To determine ability to pay, the Group analyses funds or cash flows from businesses or other regular income, not including guarantors or loan collateral which are always considered at credit approval as a secondary means of recourse. In general, guarantees are to reinforce a credit transaction and mitigate a loss if the borrower defaults. Our techniques to mitigate credit risk cover various types of customer and product. Some are for specific transactions (e.g. real estate guarantees) or a series of transactions (e.g. derivatives netting and collateral). Santander groups them by personal guarantees (with a solvent guarantor), collateral and hedges with credit derivatives. The correct acceptance of these mitigation techniques is established by verifying their legal enforceability in all jurisdictions. The entire process is subject to internal control and effective monitoring of the valuation of the guarantees, especially real estate guarantees. 1.6. Collections & recoveries management Collections & recoveries (C&R), an important area in risk management, develops a global management strategy based on local economic conditions, business models and other recovery-related particulars, with a full approach and general action lines for our subsidiaries. Recovery management follows regulatory requirements set out in the EBA Guidelines on the management of non-performing and forborne exposures. For effective and efficient recoveries management, the area segments customers based on certain aspects, using new digital channels that help create value in Collections & Recoveries function. It follows hi-tech, digital procedures to handle large groups of similar customer profiles and products; but it also adapts management for customers who need an assigned manager and tailored approach. Collections & Recoveries splits recoveries into fourphases: arrears/early delinquency, default, write-offs and foreclosed assets. To recover debt, the Group always seeks alternatives to court action, like forbearance and other arrears management techniques. Write-off category includes debt instruments, due or not, for which recovery is considered remote after an individualized analysis, due to a notorious and irrecoverable deterioration of transaction or customer's solvency. This category