Last update: 19/05/2025

Shareholders and investors need to understand financial concepts about listed companies. One that really interests them is the “payout”: the share of profits that a company “pays out” to them. Below is everything you need to know about payouts.

A payout is the share of profits that a listed company will pay its shareholders. If the payout set out in the company’s shareholder remuneration policy is 50%, the company will distribute half of its net profits among its shareholders. 

If that policy says the 50% payout should be split between a cash dividend and share buybacks, the formula is:

Payout = (cash dividend + share buyback)/underlying net profit. The payout is expressed as a percentage. 

Remember, a dividend is cash paid to shareholders for their share in the company's profits. A share buyback and the subsequent cancellation of shares are when the company “buys back” its own shares to reduce outstanding share capital and increase its share price.

Why do payouts matter to shareholders?

The payout is an indicator that influences an investor’s decision to buy shares in a company. It shows what share of the company’s profits will be paid to shareholders, whether in a cash dividend, a share buyback or both.

What does this mean? 

A payout policy can also help attract more long-term investment in a listed company. But the company must find the right balance between shareholder returns and reinvesting in its own long-term growth. A payout gives substance to shareholder remuneration policies, which influence investors’ decisions.

Santander’s payout

_{*Existing shareholder remuneration policy defined as c.50% of Group reported profi t (excluding non-cash, non-capital ratios impact items), distributed c.50% in cash dividends and c.50% in share buybacks. The implementation of the shareholder remuneration policy and any share buybacks to distribute CET1 surpluses are subject to future corporate and regulatory decisions and approvals.}

The ordinary general shareholders’ meeting approved a final cash dividend charged against 2024 results in the gross amount of EUR 11.00 cents per share entitled to dividends cash paid from 2 May 2025. Including the interim cash dividend paid in November 2024 (EUR 10.00 cents), the total cash dividend per share paid against 2024 results will be EUR 21.00 cents, around 19% more than the dividends paid against 2023 results.

These dividends are complemented by two share buyback programmes. The first has already been completed for a total of EUR 1,525 million, and the second started on February 2025 after having been approved by the board of directors and having obtained the required regulatory authorization, for a maximum amount of EUR 1,587 million (Click here to access all the information about this second programme). Following the completion of this second programme, the Group will have repurchased 14% of its outstanding shares since we began our buybacks in 2021.

After both actions have been carried out, total shareholder remuneration against 2024 results is therefore expected to be around EUR 6.3 billion, 13% higher than the remuneration against 2023 results, distributed approximately equally between cash dividends and share buybacks.

On 5 February 2025, we announced that the board of directors intends to return up to EUR 10 billion to our shareholders through share buybacks corresponding to 2025 and 2026 results as well as to distribute excesses of our capital¹. With regard to this, on 5 May 2025, Santander announced the sale of c. 49% of Santander Polska to Erste Group Bank and the intention to distribute 50% of the capital released upon completion of the transaction to accelerate its planned share buybacks, equivalent to approximately €3.2 billion, with potential to exceed the previously announced share buyback target, subject to regulatory approval².

_{¹ This share buyback target includes i) buybacks that are part of the existing shareholder remuneration policy, and ii) additional buybacks following the publication of annual results to distribute year-end excesses of CET1 capital, subject to future corporate and regulatory approvals.
² Reference is made to our notice of inside information of 5 May 2025 (official registry number 2728) relating to the sale of c.49% in Santander Bank Polska, S.A. and 50% of Santander’s Polish asset management business TFI to Erste Group Bank AG for a total cash consideration of €7 billion. The transaction is subject to customary conditions including regulatory approvals, including the Polish Financial Supervision Authority (KNF).}