Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 833

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 833
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 the macroeconomic scenarios. Also collective analysis techniques, when the potential impairment in a group of clients cannot be identified individually. With the elements indicated above, Grupo Santander has evaluated in each of the geographical areas the evolution of the credit quality of its customers, for the purposes of classifying them into stages and consequently calculating expected loss. Management overlays During fiscal year 2024, the Group has strengthened its` overlay governance by creating a corporate guide for post Model adjustments (PMAs), which has enabled a better design, monitoring and implementation of the overlays. In addition, the adjustments associated with the uncertainty resulting from the inflationary macroeconomic context of the past years have been gradually withdrawn. On the other hand, among the most relevant overlays, losses associated with climatic events have been anticipated, such as the Valencia flood suffered at the end of October 2024 for Santander España. The amount of overlays at the end of the 2024 financial year is not material compared to total Group loan-loss reserves. Exposure and loan-loss reserves Then, considering the most relevant units of the Group (United Kingdom, Spain, United States, Brazil, also Chile, Mexico, Portugal, Poland, Argentina and Santander Consumer Finance), which represent approximately 95% of the total Group's provisions. The table below shows the loan-loss reserves associated with each stage as of 31 December 2024, 2023 and 2022. In addition, depending on the transactions credit quality, the exposure is divided into fourcategories according to Standard & Poor's rating scale:

| Exposure and loan-loss reserves by stage |     |      |         |         |     |        |         |     |        |         |     |         |       |
| EUR million                              |     |      |         |         |     |        |         |     |        |         |     |         |       |
|                                          |     | 2024 |         |         |     |        |         |     |        |         |     |         |       |
| Credit qualityA                          |     |      |         | Stage 1 |     |        | Stage 2 |     |        | Stage 3 |     |         | Total |
| From AAA to AA-                          |     |      | 108,977 |         |     |  2,599 |         |     |      — |         |     | 111,576 |       |
| From A+ to BB                            |     |      | 431,544 |         |     |