Last update: 14/05/2025

Listed companies reward their shareholders with a portion of their profits. Cash dividends are the most common form of this reward. But some companies' shareholder remuneration offers up an alternative: the share buyback. Here we tell you about our shareholder remuneration against 2024 results. 

Santander's current shareholder remuneration policy consists of a total remuneration target of approximately 50% of the Group's net attributable profit, divided equally between cash dividends and share buyback programmes.

Shareholder remuneration charged against 2024 results

_{*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).}

What is a share buyback programme and why is it important for shareholders?

Share buyback is a form of remuneration for a company's shareholders. A share buyback is when companies buy back their own shares from the market, cancel them and, ultimately, reduce share capital. With fewer shares in circulation, each shareholder gets both a larger stake in the company and a higher return on future dividends.

What are the benefits of a share buyback

Here are some of the ways that buybacks work to shareholders' advantage under normal market conditions:

• First, since the company’s value remains the same but the supply of shares is lower, the share price will increase. However, that depends on market behaviour. 
• Second, the earnings per share (EPS) should increase because fewer shares are in circulation. Shareholders will have a greater stake in the company’s profits.
• Unless a shareholder chooses to offload their shares, a buyback is a tax-free transaction.

Imagine a listed company with 1,000 shares, and 100 (10%) of them are held by one shareholder. The company runs a share buyback programme and purchases 100 shares, reducing total share capital to 900 shares. The shareholder, whose stake has just increased by 1.11% to 11.11%, is now entitled to more of the company's profits. Also, the share price should become more attractive to investors.

In short, a share buy-back programme allows companies to generate additional value for their shareholders. Under normal market conditions, the portion of profits that listed companies use to buy back their own shares directly benefits the price of the shares.