Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 818

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 818
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’s risk appetite or have an unknown impact. 2. Senior managers must be involved to promote consistent risk management and control through their conduct, action and communications, as well as reviewing the risk culture and making sure Grupo Santander keeps the risk profile within risk appetite. 3. Independent risk management and control functions , according to the threelines of defence model of Grupo Santander. 4. Grupo Santander takes a forward-looking and comprehensive approach to management and control all businesses and risk types, which should analyse trends over different time periods and under different scenarios. 5. Effective information management to identify, assess, manage and disclose risks at appropriate levels.

1. Key risk types Grupo Santander's risks categorization allows effective risk management, control and reporting, and includes, among others the following risk types: • Credit risk relates to financial loss arising from the default or credit quality deterioration of a customer or counterparty, to which Santander has directly provided credit or assumed a contractual obligation. • Market risk is the risk incurred as a result of the effect of changes in market factors interest rates, exchange rates, equities and commodities, among others, may have on profits or capital. • Liquidity risk is the risk that Santander Group does not have the liquid financial resources to meet its obligations when they fall due or can only obtain them at high cost. • Structural Risk is the risk of changes in the value or margin generation of the assets or liabilities in the banking book resulting from changes in market factors and balance sheet behaviour. It also includes risks associated with insurance and pension activities. • Capital risk , included within the scope of structural risk, is the risk that arises from the possibility of having an inadequate quantity or quality of capital to meet internal business objectives, regulatory requirements or market expectations.

Grupo Santander also takes into account, on an ongoing basis in its risk management, operational (includes fraud, technological, cyber, legal and conduct risks), financial crime (includes, among others, money laundering, terrorism financing, violation of international sanctions, corruption, bribery and tax evasion), model, reputational and strategic risks. Besides, environmental and climate-related risk drivers are considered as factors that could impact the existing risks across significant time horizons. These elements include, on the one hand, those derived from the physical effects of climate change and, on the other hand, those derived from the process of transition to a development model with lower emissions, including legislative, technological or behaviour of economic agents changes. Given the nature of its operations, the Group has no environment-related