Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 822

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 822
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 defence in local units. The CRO and the CCO are involved in appointing, setting objectives for, reviewing and compensating their country-unit counterparts and assessing whether risks are properly controlled. Country and regional units work closely to effectively strengthen group-subsidiary relations through these common initiatives: • Restructuring based on subsidiary benchmarks, strategic vision, and advanced risk management infrastructures and practices. • Exchange of best practices that will strengthen processes, drive innovation and result in a quantitative impact. • Promoting internal talent and encouraging geographic and functional mobility, which we placed special emphasis on in 2024.

3. Management processes and tools Grupo Santander has these effective risk management processes and tools: 3.1 Risk appetite and structure of limits Risk appetite is the aggregate level and types of risk that Grupo Santander deems prudent for our business strategy, even in unforeseen circumstances. In Grupo Santander, these principles influence risk appetite: • Risk appetite is part of the board's duties . It prepares the risk appetite statement (RAS) for the whole Group every year. In a cascading down process, each subsidiary's board also sets its own risk appetite. • Comprehensiveness and forward-looking approach . Our appetite includes of all material risks that Santander are exposed to and defines our target risk profile for the current and medium term with a forward-looking view considering stress scenarios. • Common standards and embedding in the risk management . The Group shares the same risk appetite model, which sets common requirements for processes, metrics, governance bodies, controls and standards. It also enables an effective and traceable embedding of our appetite into management policies and more granular limits. • Continuous adaptation to market best practices, regulatory requirements and supervisors’ expectations. • Aligning with business plans and strategy . The risk appetite is a key point of reference for strategic and business planning. Grupo Santander verifies that the three-year strategic plans, the annual budget and capital and liquidity planning are within the limits set in the RAS before Santander approves them. Grupo Santander's risk appetite and business model rest on the following elements: • A medium-low and predictable target risk profile, customer focus, internationally diversified operations and a strong market share;

• Stable, recurrent earnings and shareholder remuneration, sustained by a sound base of capital, liquidity and sources of funding; • Autonomous subsidiaries that are self-sufficient in terms of capital and liquidity with risk profiles that won't compromise the Group’s risk profile; • An independent Risk function and a senior management actively engaged in supporting a robust control