Company: BCDRF
Filing Date: 2025-03-03
Form Type: 6-K
Source: 0000891478-25-000057
Chunk: 213

Company: Banco Santander, S.A.
Filing Date: 2025-03-03
Form: 6-K
Chunk 213
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• continuous improvement of the IRB regulatory models to meet supervisory expectations and adaptation to the new FRTB regulatory framework;

• review of the model inventory from the point of view of the five global businesses, thus enabling effective model risk management aligned with the Group's strategy.

2024 Pillar 3 Disclosures Report 301

| Index |     | Introduction |     | Capital |     | Risks |     | Risk taker's remunerations |     | Appendices |

11.3. Capital risk The Group takes into account, in the context of structural risk, the risk of not maintaining enough capital to absorb losses from its operations and meet internal business objectives, regulatory requirements or market expectations. The Capital Risk function, as part of the second line of defence, controls and monitors the capital activities of the first line, verifying that capital adequacy and coverage are consistent with our risk profile. It also oversees and monitors those transactions that could be considered significant risk transfer (SRT). Through a range of processes such as capital planning and adequacy and the resulting implementation and monitoring of the budget, along with continuous measurement of capital and reporting and disclosure of information on capital, as shown below: This control and oversight is carried out independently, mainly through the following processes: • Supervision of capital planning and adequac y to ensure that capital levels fit with our risk profile and are adequate and consistent with the group's strategy. • Ongoing supervision of the measurement of the group's regulatory capita l by identifying the key metrics for the calculation, setting tolerance levels and reviewing significant variations and the consistency of the calculations, including individual transactions that impact capital. The performance of capital initiatives is also reviewed and challenged, in line with the risk appetite and planning. • Monitoring the effective risk transfer of those securitisations that allow for the release of risk-weighted assets according to the applicable regulatory criteria. The function aims to provide complete and regular monitoring and control of capital risk by verifying that capital coverage and adequacy reflect the Group's risk profile. Main initiatives in 2024 We continued in 2024 to continuously monitor compliance with the units' capital contribution targets, to outline the various threats and/or opportunities on order to achieve the capital targets for this year.

The impact of market variables on capital levels was also monitored. In this sense, the Bank continues to apply hedging policies to mitigate exchange rate volatility in the CET1 ratio. In parallel, and within the risk appetite framework, the function, together with the first line of defence, established the solv