Long-time observers of European banking may feel they have heard enough about banking alliances. Time and again these have been launched amid great fanfare only to come to little. BSCH's task is to convince investors that its alliances contain greater substance.
"Before, these investments were financial investments with a little flavour added in terms of meetings and exchange of information," says José Luis del Valle, BSCH's finance director. "They were first-generational alliances. Now we are turning them into second-generational alliances with some co-operation that has to be translated into the bottom line. At the end of the year we want to be able to say this alliance added x amount to the bottom line."
Looking further ahead to an era in which cross-border banking mergers in Europe become reality, the alliances could form the basis of full-blown partnerships. But right now, as Emilio Botín has himself said: "Cross-border mergers of equals is a cock-and-bull story as far as European banking is concerned." That means new ways have to be found of co-operating midway between full mergers and merely financial holdings.
Santander's relationship with Royal Bank of Scotland (RBS) goes back to the late 1980s and it also developed one with San Paolo IMI.