ADDRESS GENERAL SHAREHOLDERS 'MEETING 2017

Ana Botín – Group Executive Chairman

President of the Government of Cantabria.

Mayor of Santander, fellow distinguished guests.

Ladies and Gentlemen. Shareholders.

Good morning and thank you very much for attending this General Meeting today.

Let me start with a question. It is the same question I asked my colleagues across the Group during our annual convention.

Think for a moment about the meaning of the word "prosperity". I received all kinds of answers.

- Some said progress meant overcoming adversity.
- Others that it meant continuous improvement and achieving balance.
- Some said prosperity was linked to learning.
- Others that it meant making people happy, helping them reach their goals.

Why do I ask this question? Because it cuts to the heart of our purpose, our mission, the reason we work every day at Banco Santander.

We want our company to prosper by helping our 190,000 employees, our 125 million customers, our 4 million shareholders and society at large to prosper.

We want to contribute, as one of our team said, so that when we look back we see that we have all reached a better place.

In 1957, our bank's centenary year, my grandfather, Emilio Botín Sanz de Sautuola y López spoke of the bank's traditions, "its principles of prudence and its sense of duty above all kinds of personal ambition."

Our transformation since 2015 is a precise reflection of this sense of responsibility, and the importance of how we do things.

I hope that when the bank celebrates its 200th birthday, our successors will be able to say the same.

This morning I will discuss our most recent results and our strategic priorities. And howwe are going to do things to make our bank even more profitable in a sustainable way

I will end with a few words about how we see the future.

2016 brought new challenges for the economy and for the banking sector.

Internationally, we saw substantial changes to the growth patterns in countries as significant as China. We continue to see historically low interest rates and currency depreciation, and in some countries continuous and rising regulatory and tax pressure. In the financial sector, we are seeing increasing competition from new players.

In our own markets, we have had the UK referendum, elections in Spain and the United States, and political developments in Brazil.

All this has led to a very volatile year in the markets. As expected, we have not been immune to its effects.

However, with an improved franchise, more cohesive teams, a clear strategy and stronger execution, we have been able to achieve excellent results in 2016.

At the Group level, in 2016 we achieved our commercial and financial targets and met the profitability metrics we promised to our shareholders in the right way.

We registered an attributable profit of 6,204 million euros, a 4% increase. Take out the negative impact of the currencies of the countries in which we operate, and this increase is 15%.

We achieved it by controlling costs and lowering our cost of credit, leading to a higher gross margin.

We improved our customer relationships in all our units, by offering better products and services. As a result, we have:

- More customers. We increased the total number by 4 million, to 125 million.
- More loyal customers. We increased the number of loyal customers by 10%, to 15.2 million.
- And more satisfied customers. We are now leaders in customer satisfaction in most of our core markets.

We increased our profits in nine of our top ten markets, achieving a double-digit pre-tax increase in most of them.

Our Chief Executive will provide further details.

Ladies and Gentlemen.

Our good results in 2016 make us one of the few international banks that can do 3 things at once:

- Finance profitable growth, by increasing lending for our customers and improving service.
- Accumulate capital.
- Continue to increase the dividend for shareholders.

Regarding our capital:

In three years we have increased our capital by 19.5 billion Euros, 12 billion raised organically and 7.5 billion from the market.

We ended 2016 with a CET1 capital ratio of 10.55%, 50 basis points more than in 2015.

We have exceeded our own capital goals and the demands of regulators.

But it's not just the strength of our capital that matters, but also its quality and the strength of our balance sheet.

Most of our assets are loans to customers and our main sources of financing are stable customer deposits.

In 2016 we increased lending by 2% and deposits by 5%. [In constant euros]

We also improved the quality of our credit:

- Our cost of credit improved by 7 bp, to 1.18%.
- And the Group's non-performing loans ratio fell by 43 bp to 3.93%.

Based on our performance in 2016, we maintained our usual four dividend payments to shareholders.

We have already paid three of them. Two in cash, worth 5.5 cents per share each, and another 4.5 cents per share under the Santander Dividendo Elección (scrip).

The fourth and last will be 5.5 cents, to be paid in May in cash, if approved at this General Meeting. With this, the total remuneration would amount to 21 euro cents per share.

We fulfilled our commitment by increasing the total dividend per share by 5% and the cash dividend per share by 8%.

So far this year, our total return to shareholders is 17%, much higher than the 6% average for European banks, and the best among our peers.

From the end of 2015 to 31st March this year, our total return to shareholders is 34%, compared to 4% for the index of European banks.

This good performance is reflected in the confidence of investors: we are the best rated bank in Europe at 1.3 times tangible value per share, compared to our peers’ average of 0.9 times.

For 2017 and in accordance with the policy approved by the board of directors, the board’s intention is to increase the total dividend per share again to 22 cents per share.

We will put this to the AGM for approval with the year’s results distribution proposal.

This will be paid out in three dividends in cash, valued at 6 cents per share each, and one under the Santander Dividendo Elección program, at 4 cents.

This way, the total dividend per share will continue to increase by almost 5% and the amount paid in cash will grow by around 9%.

We thus maintain our policy of increasing the cash dividend, which is positive in two ways.
First, it allows shareholders to choose how to invest their dividend. Second, it does not dilute their shares.

Regarding our corporate governance:

As Chairman of the Board of Directors I am required to tell the Shareholders' Meeting about the Group's corporate governance.

We have included in the Regulations of the Board of Directors the requirement that the majority of its members be independent, as they are today.

The board committees are composed of non-executive directors, and chaired by an independent director. Most committee members are independent, except in the case of the audit committee, where all are independent.

Only the executive committee, because of its special nature, departs from this rule, though half of its members are external directors.

Homaira Akbari's appointment to the board significantly strengthens the bank’s knowledge and experience in two key areas: digital transformation and international business background.

The functions of the audit committee have been extended and Belen Romana has been appointed its Chairman.

The innovation and technology committee has been strengthened, reflecting the board’s recognition of its importance.

Lastly, the International Advisory Board has begun work. Its new members are reported at this Shareholders' Meeting. Their backgrounds, qualifications and dedication are of great value to the board and the executive team as we turn the challenges posed by technology into opportunities.

I want to thank Ángel Jado for his dedication to the Bank during his long service as a member of the board, and all the board members for their dedication and commitment, and for their support for our strategy which we have defined together.

I would like to focus on the three main elements of our competitive advantage.

1. First, our critical mass.

Our focus is retail banking, mostly in 10 markets, where we have been for a long time; which we know very well; and where we are, or can be, one of the leaders.

We have 125 million customers in countries and regions with a billion inhabitants. We have the scale we need in big markets and the opportunity to achieve profitable growth.

2. The second advantage of our model is geographic diversification, which covers Europe and the Americas, and gives us a highly attractive and differentiated profile.

- First, it gives us a balance between mature and emerging economies.

Over the years, we have seen our businesses in Spain, the United Kingdom and Brazil take turns as the major contributor to the Group's profits.

- Second, thanks to this balance, our results are more stable and predictable, which means we need less capital than our peers.

We have studied the markets where we are, and we are where we want to be.

Our priority is to maximize the investments we have already made.

We are committed to the United States which is the largest financial market in the world, and an attractive market, where we know what needsto be done to compete successfully.

We have improved our team and our corporate governance.

And we are very pleased with the progress made over the past year, which has been recognized by the local supervisors.

Our bank in the United States, which stands out for its financial strength, has increased digital customers by 26% and deposits by 4%. We are laying the foundationsfor improving profitability.

Our consumer finance business in the US generated a return of 18%, even while shifting the business to a lower risk profile.

We are executing the strategy we promised. Our goal is to be a super-regional bank in America. We have the platform and the team to achieve it.

3. The third and final factor is our subsidiaries model which provides us with two advantages and an opportunity.

The first advantage is that it minimizes risks, since all of our banks in each market are autonomous in capital and liquidity

The second is that it makes us strong locally. It allows us to be close to our customers and to respond to their needs with agility.

The great opportunity that it represents is greater collaboration between the countries and businesses of the Group.

Better connections between our subsidiaries lead to the exchange of knowledge and experience, and in turn, better results and greater efficiency.

As Ortega y Gasset said: "Men do not live together for the sake of it, but to undertake great ventures together."

There are many projects we can do better together.

For example, our Santander Wallet app allows customers to pay in stores using their phones, among other innovations. More than 400,000 customers in Spain and Brazil are already taking advantage of this service. It will soon be available in Mexico and Chile.

The corporate center plays a vital role in increasing active collaboration.

It brings value to the Group and allows for economies of scale. We have cut its cost by 18% in 2016, and by 35% over the past 3 years.

The proof of its value is that in 2016 we maintained a cost-income ratio of c.48%, the best among the global banks.

On this basis, allow me to explain how we are going to achieve our goal of profitable and sustainable growth. The key is to continue executing our strategic plan.

We want to be the best retail bank in Europe and the Americas, earning the lasting loyalty of our people, customers, shareholders and communities. We want to gain that trust by acting in a way that is Simple, Personal and Fair and by helping people and businesses prosper.

As important as what we achieve is how we achieve it.

This is the path that we are going to follow:

First, our employees

Our success is based on the 190,000 professionals who work for the Group. [More than the entire population of Santander, which is 172,656]
We know that we are all more effective the more we enjoy what we do.

To attract the best and increase everyone’s commitment, we are going to:

-Improve continuous education training.
- Listen more to our employees and give them the tools and opportunities to work more flexibly.
- Pay people for “how” they achieve results, and reward those who best represent our corporate behaviors.
- And continue to put technology at the service of people, our teams and our customers.

Our metrics tell us we are on the right track.

- We are in the top 3 best banks to work for in four of our markets.
- Our annual engagement survey, in which 85% of our employees participated, showed that our teams are more committed to the organization.
- And 79% of our employees identify with our Simple, Personal, Fair culture.

We are going to continue with this, and our target this year isfor the level of commitment to reach 80%, seven percent higher than the best companies.

Second, our customers.

We have a base of 125 million customers that allows for profitable growth.

Now, our goal is to provide them with better service so they become better customers

Because a loyal customer is four times more profitable than one who is not. With our business customers, the multiple is even higher.

Loyalty means we are a client’s main bank for all their banking operations.

The 1|2|3 strategy, which we have in the United Kingdom, Spain and other countries, has encouraged these better relationships.

Satisfied customers get the products and services they need when they need them. They know their bank is always there, adapting to their tastes and lifestyle.

On the screen, you can see our objectives for 2017 and 2018.

To achieve them, we will continue the commercial transformation we began in 2015 and to invest in technology, spending 1,900 million euros per year.

We are working on three fronts:

- First, transforming our traditional products and services. Our ContaSuper in Brazil, a digital account and card for the unbanked, is one example.
- Second is Openbank, a fully digital bank that we will relaunch in the coming days.
- The third, is Santander Digital and Santander InnoVentures, our EUR 200 million investment fund.

Through Santander Digital, we encourage active collaboration between countries for the benefit of all.

By investing in technology today, we are securing our future.

Our shareholders

Our shareholder base is broad and diversified: 4 million shareholders who rely on Santander every day in more than 100 countries, mainly in Europe and the Americas.

Every day, we work hard to give each one of them personal attention, with the transparency which characterizes our entire relationship.

In 2016 we delivered on our commitments. We increased:

- The cash dividend.
- Earnings per share.
- And tangible value per share.

Our plan for 2017 is to further improve all of these metrics.

Finally, I would like to talk about our commitment to society.

Santander is a responsible company that shares the concerns of the society in which it operates.

Let me share with you some figures which illustrate our commitment:

- Around 16 billion euros in taxes and social contributions collected and paid, directly by the group and through third parties.
- 209 million euros of social investments in communities.
- Direct support to 1.7 million people.

We are the best bank in Europe and the sixth best in the world in the Dow Jones Sustainability Index.

We will strengthen our commitment to society in 2017/18:

- We have raised our target for 2018. We want to help 5 million people through our financial inclusion, entrepreneurship and social action programs.

We are going to build on our university program, already the largest supporter of higher education worldwide, by focusing on entrepreneurship and job creation. Adapting to climate change and lessening its impact is a priority for Banco Santander. We will continue to reduce our environmental footprint.

Finally, I would like to share with you how we see Banco Santander in the coming years.

I have already reminded you of ourstrategic objectivesfor 2017/18 and we reiterate them today, as you can see on the screen.

Though we anticipate that volatility and factors outside the Group may affect us in some countries, we are confident that we will achieve them.

The bank’s good performance over the last year and the positive trends arising from our new strategy allow me to tell you today: we are going to do even better.

We have a huge challenge ahead of us: digital transformation. Not only are we going to have to do the same things in different ways, but we are also going to have to do things we never imagined before.

Ruskin said that education is not making a child learn what he or she doesn't know. It is making that child into a person who didn’t exist before.

We want to become a new bank, capable of providing services that we had not previously imagined.

We have 125 million customers in Europe and America, a robust infrastructure, great risk experience and the team we want and the ability to keep attracting the talent we need.

We have a great platform to keep growing profitably.

Furthermore, if IMF estimates are met, 2017 will be the first year since 2010 when there will be economic growth in our top 10 markets.

Allow me to finish with Spain.

Spain is a key market for us.

It is the country of our roots, our headquarters and where we continue to have great potential.

The Spanish economy has done very well over the last two years, exceeding most forecasts.

During the past two years, Spain has created a million jobs.

This growth is based on strong foundations:

- Companies are financially healthier and more competitive.
- Families have more to spend and invest, thanks to rising employment and lowering debt.

Even in a less favorable external and budgetary environment, we should be able to continue growing at a rate of around 2.5%, significantly higher than the Eurozone average.

And to continue to invest in education, supporting entrepreneurs and job creation, so we can ensure that everyone who wants a job can find a job.

Few countries have the experience and position Spain has in Europe and Latin America, with access to more than 1 billion people, with a unique combination of strength, tradition and dynamism.

In this time of great change, the European model has much to offer in terms of its values, institutional frameworks and sustainable innovation.

Spain has opportunities not just to do better economically, but also to increase its institutional weight and its contribution to the major challenges facing our region and the world.

I want to make a special mention of this region of Cantabria.

Our bank carries the name of Santander around the world.
We do it with pleasure and pride.

Our commitment to this city and to this region remains as strong as ever. We show it through our continued support for the economic, cultural and social initiatives that you know so well.

Today I’d like to share with you something I think you’ll enjoy.

A few weeks ago, a list was published of the world’s most valuable companies

The home towns of the top five were: Cupertino, Mountain View, Redmond, Omaha and Seattle.

These are not huge cities, but rather cities of human scale. The kind of places where people understand what the novelist Jose Maria de Pereda, who gave his name to the promenade outside our headquarters, meant when he said: "Experience consists not of what we have lived, but of what we have thought."

The development of our bank isthe result of many thoughts, many experiences and many reflections that have had their origin here, in this city.

Banco Santander is not yet among the top five most valuable companies in the world, which are Apple, Google (now Alphabet), Microsoft, Berkshire Hathaway and Amazon.

But we have a longer story to be proud of. So in this, as in so many other things, this bank, from this special city, has also been a pioneer.

We have been pioneers in understanding that to build the future I have described, after the complex adjustment of recent years, requires a transformation. To continue to prosper requires us to make ambitious changes.

Building on our economic recovery so that everyone benefits is up to all of us, including companies. It requires collaboration between all institutions.

Rest assured that we will do our part. We will help our employees and customers, people and businesses. We will contribute to their education, make it easier for them to buy homes, support them in what they do and help turn their plans for the future into reality.

We can be proud of our recent performance and we are confident about our prospects for this coming year.

As Henry Ford said: "Coming together is a beginning; keeping together is progress; working together is success."

We are going to work together to be a simple, personal and fair bank. As we did in 2016.

I want to thank specially each and every one of our team members for their hard work and commitment. They are the ones who make Santander a great bank.

When we do our job, our employees grow professionally, our clients trust us more and they prosper together with our shareholders, and our communities.

Returning to where I began, I hope that it is clear that whatever each of us means by the word "prosperity", Santander is helping us achieve it.

Whether we think of prosperity in terms of self-improvement, balance, learning or helping other people reach their goals.

Ladies and Gentlemen shareholders, thank you for your support and your commitment to contributing to the prosperity of all.

Many thanks.

Speech of Mr. José Antonio Álvarez, Chief Executive Officer of Banco Santander, at the Annual General Shareholders’ Meeting, April 7, 2017

Mr. President of the government of Cantabria.

Mayor of Santander and authorities here today.

Shareholders of Banco Santander, ladies and gentlemen.

Good morning and thank you for attending Santander's AGM.

The Chairman has commented on the economic environment, the main lines of ourbusiness model, strategy and evolution, as well as the extent to which we have met our goals.

I will divide my speech as follows:

1) First, I will give you greater details of the Group's performance in 2016.

2) I will then share with you my views on the main initiatives and the results of the units in 2016, as well as the management priorities for 2017.

3) Lastly, I will dedicate a few minutes to the outlook for this year.

1. THE SANTANDER GROUP’S EVOLUTION IN 2016

Our strategy and business model in 2016 continued to generate value for our customers and shareholders. Our geographic diversification and leadership in cost/income efficiency gives us a clear competitive advantage. This has enabled us to counter a difficult macroeconomic environment, particularly for banks, bouts of volatility and the higher tax pressure in some countries.

In this context, we produced solid financial results. We are generating sustainable and predictable returns, meeting our financial and commercial objectives.

As the chairman has already mentioned, we ended 2016 with an attributable profit of EUR 6,204 million, 4% more than in 2015 and 15% higher on a currency-neutral basis. The exchange-rate impact was again negative last year.

Our profit puts us among the top part of the 17 global banks that are our peers. Moreover, if we focus just on European banks, our fourth quarter profit was the highest.

This profit includes some non-recurring results for a net negative amount of EUR 417 million compared to EUR 600 million negative in 2015. These figures are the net between positive capital gains and negative results of restructuring costs and other provisions.

The underlying profit before the non-recurring results and taxes (the tax rate rose to 30%), was 12% higher at EUR 11,288 million on a currency-neutral basis.

These good results were due to an improved performance in most units and to the positive evolution of the main income statement lines:

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I will now turn to the balance sheet:

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More over, we have combined the generation of capital with high profitability. In underlying terms, our return on tangible equity (RoTE) is 11%, comparing well with that of our peers.

In short, in 2016:

- Both profit and dividends increased.
- We grew in volumes on a currency-neutral basis.
- The balance sheet structure remained balanced.
- And we significantly improved our solvency and credit quality.

All of this was achieved while progressing in our commercial transformation, fostering customer relations and improving their experience of the bank.

2. EVOLUTION BY BUSINESS AREAS

I will now briefly look at the evolution of the main units in 2016 and the priorities for 2017.

The strategy for the units in MATURE MARKETS was to increase the number of loyal customers, gain market share, control costs and improve credit quality.

At SANTANDER ESPAÑA we continued to focus on building a deeper and lasting relationship with its customers. The 1|2|3 strategy is already yielding good results:

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Of note in the UNITED KINGDOM in an environment of greater uncertainty in the second half of the year was our solid business evolution, with 1|2|3 customers 5 reaching 5.1 million and growth in loans to companies. We remained focused on operational excellence, with a continuous improvement in our mobile phone channels and online banking. The number of digital clients rose 25%.

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SANTANDER CONSUMER FINANCE offers a unique value proposal and holds a clear leadership position in Europe. In 2016, we continued to gain market share, underpinned by a solid business model.

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In the UNITED STATES we integrated into one holding (Santander Holding) all our operations in the country and we made significant progress in complying with regulatory requirements. In addition, we continued to work on the transformation programme to improve risk management and technological and operational capacities.

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Our bank in PORTUGAL is the most solid and profitable in the country.

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Business volumes in DEVELOPING MARKETS grew at a faster pace than in mature ones, interest rates were higher and also profitability. In this environment, Santander has local critical mass, strong commercial models and active risk management, all of which produced very good results in all units.

Beginning with BRAZIL, and in an environment of recession, profit was excellent, due to the franchise improvements made in the last few years, good business dynamics and progress in digitalisation. The number of digital clients increased 45% to more than six million.

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The strategy in MEXICO was very centred on customer retention, the commercial transformation and innovation. We were very busy in launching products and commercial agreements such as the Santander Plus programme (similar to the 1|2|3 account in Spain), which has already attracted more than 1.1 million customers. We also launched the Santander-Aeroméxico card, of which more than 430,000 were issued.

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At SANTANDER CHILE the priority was to maintain market leadership and improve the quality of service. We started from a position of disadvantage compared to our competitors but managed to close the gap in the last few years. In 2016, we topped the customer satisfaction ranking. We gained market share and continue to be the leaders in lending and second in deposits.

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In ARGENTINA after the change in the institutional framework, we want to exploit the country's high growth potential and a financial system which is very transactional. This is why we decided to bolster our position in the country by acquiring Citi’s retail business

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In POLAND we continue to be the reference bank in innovation and digital channels. We increased the number of loyal customers, particularly companies, and our credit growth is well above that of the sector as a whole.

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Lastly, the units in URUGUAY and PERU increased their profits 32% and 21%, respectively (on a currency neutral basis). In Uruguay’s case, this was due to significant growth in gross income and in Peru’s to lower provisions.

I will end this overview of the business areas with some comments on GLOBAL CORPORATE BANKING whose results are included in the profit figures I have given for each of the countries.

The main activity of this business is:

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We are leaders in countries such Spain and Brazil, as well as number one in some products for the whole of Latin America.

Profit was 30% higher in 2016 (on a currency neutral basis), underpinned by the strength and diversification of revenues. The latter represent 13% of the Group’s total: 86% of revenues come from customers.

Looking ahead, we will continue to develop this business in the UK and US, while strengthening our presence in countries where we already are leaders.

We will also continue to bolster connectivity with retail banking clients and progress toward a model that is lighter and more efficient in capital.

I would like to point out that these results would not have been possible without the CORPORATE CENTRE’S contribution. We continued to work in 2016 on creating a more agile centre and one that contributes more value to the Group.

We are optimising and digitalising processes and have restructured functions and posts in order to improve productivity and efficiency, while our policies, models and control frameworks enable the Group to have solid governance.

3. ENVIRONMENT, OBJECTIVES AND CONCLUSION

Ladies and gentlemen, shareholders,

After detailing the Group’s performance and that of the main units, I will now end with a look at the future.

2016 has been a year of sensible changes in the economic and political arena and 2017 still offers some uncertainties in these areas.

There are some positive aspects, however, that invite optimism abut the near future.

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We are thus seeing the positive trends of the Group in 2016 being maintained in the first months of this year.

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These trends allow us to be optimistic about achieving the goals we announced to investors last September, and which the Chairman has shown.

In order to attain them, we have set the following financial priorities for 2017:

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Ladies and gentlemen, shareholders

Although our share price has increased significantly in the earlier months of 2017, I I believe that our share price today still does not reflect the strength of our balance sheet and the potential in the long term of our Group results:

I am confident that the diversification and quality of our businesses, their growth capacity and profitability potential will be reflected in a higher share price.

Lastly, I would like to thank all the Group’s professionals for their efforts in transforming and improving our bank. The achievements in 2016 and attaining the goals in 2017 would not be possible without the contribution of each and every one of them.

As well as having the best professionals, we have also drawn up succession plans in key posts in order to guarantee business continuity in the future.

We will continue to work every day to help people and businesses prosper, and to turn Santander into the best retail and commercial bank by earning the lasting loyalty of our customers, communities and, in particular, all our shareholders.

I firmly believe that, with the efforts of all of us, the engagement of our employees and the confidence of our customers and all of you, we can attain all our goals.

Ana Botín: “The Board’s intention is to increase the total dividend per share by 5% again in 2017”

"Dividend would total EUR 22 cents, paid in three cashdividends valued at 6 cents per share each, and one under the Santander Dividendo Elección program, at 4 cents. The amount paid in cash would grow by around 9%". Between 2015 and 2017, total cash dividend per share will have increased 20%

In 2016 we fulfilled our commitment: we increased the cash dividend per share, profit per share and the tangible value per share. Our plan for 2017 is to further improve them.

"We will continue to invest in technology, spending 1,900 million euros per year".

Santander's Annual Shareholders’ Meeting approves the reelection as board members of Ana Botín, José Antonio Álvarez, Rodrigo Echenique, Esther Giménez-Salinas and Belén Romana. Shareholders also approve the appointment of Homaira Akbari to the board.

• "So far this year, the total return to our shareholders is 17%, much higher than the 6% average for European banks, and the best among our peers. This good performance reflects investor confidence in our strategy and our team".

• 2017 will be the first year since 2010 with economic growth in our top 10 markets. We reiterate our goals for 2017 and 2018.

• Spain has the chance not just to do better economically, but also to increase its institutional importance and its contribution to the major challenges facing our region and the world.

• "In three years we have increased our capital by 19.5 billion Euros, 12 billion raised organically and 7.5 billion from the market. We closed 2016 with a CET1 capital ratio of 10.55%, that is, 50 basis points more than 2015. We have exceeded our own capital goals and the demands of regulators".

Madrid, 7 April 2017 Banco Santander's Group executive chairman, Ana Botín, chaired the Annual General Meeting today which approved the bank's 2016 accounts. Botín highlighted that “with an improved franchise, more cohesive teams, a clear strategy and stronger execution, we have been able to achieve excellent results in 2016", despite volatility in markets and the "new challenges" for the economy and the banking sector. "We again achieved our commercial and financial targets, and met the profit metrics we promised to our shareholders in the right way", Botín said, adding that “the good results obtained in 2016 make us one of the few banks that can do three things at once: finance profitable growth, accumulate capital and continue to increase the dividend we pay our shareholders".

Botín recalled that Banco Santander registered attributable profit in 2016 of EUR 6,204 million, an increase of 4%, and that underlying profit, without the negative impact of the currencies of the countries in which the Group operates, rose 15%. The executive chairman of Banco Santander indicated that "in 2016, we fulfilled the commitment made to our shareholders: we increased the cash dividend per share, profit per share and the tangible value per share. Our plan for 2017 is to further improve them". Santander's executive chairman also pointed out the progress made in terms of customer loyalty, which is at the center of Group´s current strategy: "We improved our relationship with customers in all our units, offering better products and services. As a result we have more customers, which are more loyal and more satisfied".

Dividend

Botín underscored that the Bank increased by 5% the total dividend per share against 2016 results, and the cash dividend 8%, to a total of 21 euro cents per share. Shareholders have already received three payments: two in cash, worth 5.5 cents per share each, and another 4.5 cents under the Santander Dividendo Elección (scrip) program. The fourth, for the same amount as the two in cash, will be paid in May. She pointed out that "So far this year, the total return to our shareholders is 17%, much higher than the 6% average for European banks, and the best among our peers. This good performance reflects investor confidence in our strategy and our team".

Regarding the dividend against 2017 results, Botín said that "for this year, and according to the policy approved by the board of the directors, the board’s intention is to increase the total dividend per share again to 22 cents per share, and that is what we will put to this AGM" next year. The dividend will be paid out in three cash dividends valued at six euro cents per share each, and one under the Santander Dividendo Elección program, at four cents. Botín explained: "in this way, the total dividend per share will continue to increase by almost 5% and the amount paid in cash will grow by around 9%".

"We thus maintain our policy of increasing the cash dividend, which is positive in two respects: first, it allows shareholders to choose how to invest the dividend they receives and second, it does not dilute their shares, Ana Botín added.

Botín also referred to Santanders capital position: "in three years, we have increased our capital by 19.5 billion Euros, 12 billion raised organically and 7.5 billion from the market, she said, adding that "we ended 2016 with a CET1 of 10.55%, 50 basis points more than in 2015. We have exceeded our own capital goals and the demands of regulators. In her opinion, "it's not just the strength of our capital that matters, but also its quality and the strength of our balance sheet. Most of our assets are loans to customers and our main source of financing are stable customer deposits."

Growth and goals

Santander's Group executive chairman reiterated the goals set for the bank in 2018: "Though we anticipate that volatility and factors outside the Group will affect us in some countries, we are confident that we will achieve them", she indicated. Botín pointed out that "the Bank's good performance over the last year and the positive trends arising from our new strategy allow me today to say this: we are going to get better."

Along with the rest of the sector, Santander has "a huge challenge ahead of us: digital transformation. Not only are we going to have to do the same things in different ways, but we are also going to have to do things we never before imagined." In this respect, she confirmed that the Bank will continue to invest in technology, spending 1,900 million euros per year to carry out the transformation. She explained that the Group is working on three fronts: "first, transforming our traditional products and services; second, with Openbank, a fully digital bank that we will relaunch in the coming days; and third, through Santander Digital and our 200 million investment fund Santander Innoventures."

Looking forward, Botín is confident that "we have a great platform to keep growing". She identified Santander's three main competitive advantages: "our 125 million customers, our focus on commercial banking, mostly in 10 markets; geographic diversification, with a balance between mature and emerging economies which makes our results more stable and predictable, which means we need less capital than our peers; and the subsidiaries model, which minimizes risks, makes us strong locally, but also presents a great opportunity for more collaboration between the countries and businesses of the Group". In this sense, she explained that “the corporate centre plays a vital role: it brings value to the Group and allows for economies of scale while at the same time we have reduced the cost of it by 18% in 2016 and 35% in three years." She underscored that “we have studied the markets where we are and we are where we want to be."

Botín indicated that "the key to reaching our goal of profitable and sustainable growth is to continue executing our strategic plan." She added that Santander wants to be "the best commercial bank in Europe and America, gaining the trust of our employees, customers, shareholders and society in general by acting in way that is Simple, Personal and Fair, by helping people and businesses prosper" and she insisted that “as important as what we achieve is how we achieve it."

Corporate governance and commitment to society

Santander's Group executive chairman referred to some of the changes made by the bank in terms of corporate governance. "We have included in the Regulations of the Board of Directors the requirement that the majority of its members be independent, as it is today". She also said that the Bank has strengthened the innovation and technology committee, so that it reflects "the board’s recognition of its importance." She reminded also Homaira Akbari’s appointment as board director and the start up of the International Advisory Board.

"Santander is a responsible company that’s concerned about the society in which it operates", Botín said. She explained that Santander will strengthen its commitment to society in the next two years. "We have raised the goal for 2018. We want to help 5 million people thorugh our financial inclusion and social action programs." The executive chairman also said that the Bank is going to build on its university program, what makes Santander the largest supporter of higher education globally, by focusing on entrepreneurship and job creation.

Spain

Botín reasserted the bank's commitment to Spain: "It is the country where our roots are, our headquarters and where we have great potential." She said that “the Spanish economy has done very well over the last two years. This growth has been based on strong foundations: Companies are financially healthier and families have more to spend and invest”. She added: These foundations should enable us to continue growing at a rate of around 2.5%. Continuing to invest in education, supporting business and job creation, we can make sure that everyone who wantstowork can work“. In her opinion, “few countries have the experience and position Spain has in Europe and Latin America, which gives us access to more than 1.1 billion people, with a unique combination of soundness, tradition and dynamism.” She also said that “Spain has the chance not just to do better economically, but also to increase its institutional importance and its contribution to the major challenges facing our region and the world: education, higher quality employment and financial inclusion.”

The AGM approved the re-election as board members of Ana Botín, José Antonio Álvarez, Rodrigo Echenique, Esther Giménez-Salinas and Belén Romana. Shareholders also approved the appointment of Homaira Akbari to the board.

José Antonio Álvarez: “The positive trends of 2016 continue in the first months of this year”

Banco Santander's CEO, José Antonio Álvarez, provided an in-depth review of the Group's units in the countries and the global businesses. He summed up 2016 saying: “profit and dividend increased; we grew volumes excluding the exchange rate effect; the balance sheet continued to have a balanced structure; and we have significantly improved our solvency and credit quality". He added: "All that was done while at the same time moving ahead in our commercial transformation, enhancing our customer relationships and improving their experience with the bank”. Álvarez showed confidence in Santander’s ability to deliver on its targets. "We are seeing that the positive trends of 2016 continue in the first months of this year: we are increasing loyal and digital customers; costs remain contained as in previous quarters, credit quality is improving and we are generating organic capital". Santander's CEO set out the bank’s financial priorities for 2017:

- Accelerate revenue growth, mainly in emerging economies.
- Grow market share in mature economies.
- Keep costs under control, with an overall growth below average inflation in the countries.
- Continue to improve the cost of credit, with falling provisions as the cycle improves in countries such as Brazil and Spain.
- Risk Weighted Assets (RWA) growth below the Group’s lending and profit growth.

Santander, the first bank to certify its sustainability certificate at its Annual General Meeting

Madrid, 10 April 2017 Banco Santander has been granted AENOR´s certification for Sustainable Events management for the sustainability of its Annual General Meeting. With this certification, Banco Santander becomes the first financial institution to be granted this award, which is based on the UNE-ISO 20121 standard.

The UNE-ISO 20121 establishes requirements for the development of a sustainability management system for any event or activity, such as an AGM, conference, sporting event or music festival.

AENOR has certified that all of the processes associated with Santander´s Annual General Meeting- for its entire life cycle from planning to after the event has taken placehave followed sustainability criteria that facilitate a reduction in its impact and as well as the generation of economic, environmental and social benefits in the community where it took place.

This certification foments a reduction in consumption of resources such as water, energy and waste, among others. Furthermore, it encourages the use of local suppliers and workers at risk of exclusion, as well as the use of collective transportation.

It is the most direct way to demonstrate the public and ethical, environmental and sustainability commitment of the entity, while it helps to enhance its reputation and the coherence of its social responsibility policy; for example, fomenting commitments to suppliers.

The UNE-ISO 20121 standard provides criteria for different phases and activities: design, planning, execution, revision and activities that occur after the sustainable event.

About AENOR

AENOR, through certification and evaluation, contributes to improving the quality and competitiveness of companies and their products and services. AENOR is the leading certification organization in Spain and among the 10 main certification organizations in the world. Currently, nearly 70,000 employment providers have AENOR cerficiations which support organizations in areas such as Quality, Environmental Management, Innovation, Work Safety and Social Responsibility. AENOR is a global entity that carries out activities in 70 countries involving certification, training, inspection, analysis, validation and verification of projects that reduce emissions, accompanying companies in their expansión. AENOR has 20 centres in Spain.

Santander permite ya sacar dinero con cualquier móvil en el 40% de su red de cajeros

Madrid, 11 de abril de 2017. Banco Santander mantiene su apuesta por la innovación y la sencillez en las operaciones más cotidianas y se convierte en la primera entidad en España que permite a sus clientes operar en cajeros para reintegros e ingresos con tecnología contactless, tanto con teléfonos Android y iPhone. Desde el pasado 6 de abril, la entidad cuenta ya con una red de 1.900 cajeros en toda España, el 40% de su red actual, equipados con esta tecnología. A finales de año, habrá llegado a 2.300 puntos en toda España.

Con este servicio, Santander mejora la operatividad y la seguridad de las extracciones de efectivo para sus clientes, que contarán con sus tarjetas físicas y un back up en el móvil. Eso les permitirá disponer de las tarjetas de forma inmediata desde el momento de su emisión, aunque todavía no hayan recibido el plástico. Además, la seguridad de las operaciones va certificada por huella dactilar (ya disponible en iPhone y, a partir de junio, en Android a través de Santander Wallet.

Entre otras funcionalidades, además de extraer dinero en efectivo, los nuevos cajeros permitirán ingresar dinero en la cuenta corriente del cliente (o de otro cliente del Santander) con o sin tarjeta, devolverán el cambio preciso con monedas y billetes o pagarán recibos, tasas y tributos con tarjeta o en efectivo (con devolución de cambio) desde el mismo cajero.

A partir de junio, se incluirá la posibilidad de generar un código desde la aplicación del banco para sacar dinero sin tarjeta y poder enviarlo a un tercero.

Desde el pasado 1 de diciembre, Banco Santander es la única entidad que permite a sus clientes realizar pagos a través de cualquier dispositivo Android (Santander Wallet) o iOS (Apple Pay).

188,182 professionals.

We launched MyContribution, the new corporate model of performance management that strengthens the Bank’s culture as the driver of transformation. MyContribution balances the objectives on behavour (40%) and business and performance (60%) for the Corporate Centre.

In Flexiworking, the programme aimed at creating a new way of working, new spaces are being forged that strengthen cooperation.

Development of the first phase of StarmeUp, the first global recognition network to spur cooperation and recognise those employees who apply the corporate behaviour to their daily working. Employee participation was 47%.

The BeHealthy week was held throughout the Group, in order to promote a healthier life style based on the four points of the programme: Know your numbers, Eat, Move, Be balanced.

128 million customers.

The commercial transformation programme started in 2015 continues to drive growth in the number of customers (+1.5 million loyal ones and +4.2 million digital ones in the last 12 months).

Our goal is to keep on improving customer satisfaction. In eight of our core countries we are already among the Top 3 in local rankings. We continue to promote various initiatives, such as opening innovative WorkCafé branches in Chile or Smart Red in Spain and other countries.

In customer loyalty, the 1|2|3 strategy is doing well in various countries, with differentiated value proposals. Also noteworthy was the launch and consolidation of other loyalty products, such as the American Airlines cards, AAdvantage in Brazil and Santander Aeroméxico.

Of note in digitalisation was the continuous development of our value offer, with new proposals such as the Investment Hub in the UK (online funds platform) and the good functioning of ContaSuper in Brazil, a digital account and card for those without a bank.

4 million shareholders.

The Annual General Meeting was attended by shareholders accounting for 64.03% of the Bank’s share capital, the highest attendance rate of the Bank’s recent history. The Bank’s corporate management received more than 97% support from those at the meeting.

Banco Santander is the first bank to receive the AENOR certificate for management of sustainable events, which certifies the sustainability of its general shareholders’ meeting.

Institutional Investor, one of the most prestigious publications in the investor and finance world, assessed our shareholders and investors section in our corporate web as the second best in Europe.

1.7 million people helped in 2016

The World Innovation Summit for Education (WISE) was held at the Group’s headquarters in Madrid. WISE is the main global initiative for fostering innovation and cooperation in education.

Santander Impact, a digital space, was created. It shows the initiatives of Santander Universities in all the countries in which it operates, visualising the impact of its academic, social and sponsorship projects on people’s progress.

In Poland, a financial education portal was launched, which is easy to access and adapted for people with sight difficulties. In Spain, Santander was the first Spanish company to obtain the certificate of excellence in management of corporate volunteering in the category of Excellence Plus.