Santander Bancorp 8-K Santander Bancorp Reports Record Financial Earnings

SANTANDER BANCORP
SELECTED CONSOLIDATED FINANCIAL INFORMATION:
(DOLLARS IN THOUSANDS)
		QTD		QTD		QTD
						As restated
		Mar. 31,		Dec. 31,		Mar. 31,	1Q04/4Q03	1Q04/1Q03
		2004		2003		2003	Variation	Variation
Interest Income	$	85,827	$	86,140	$	79,022	-0.36%	8.61%
Tax equivalent adjustment		4,740		5,184		4,391	-8.56%	7.95%
Interest income on a tax equivalent basis		90,567		91,324		83,413	-0.83%	8.58%
Interest expense		31,851		31,384		35,395	1.49%	-10.01%
Net interest income on a tax equivalent basis		58,716		59,940		48,018	-2.04%	22.28%
Provision for loan losses		8,750		15,000		12,065	-41.67%	-27.48%
Net interest income on a tax equivalent basis after provision		49,966		44,940		35,953	11.18%	38.98%
Other operating income		24,763		24,053		23,778	2.95%	4.14%
Gain on sale of securities		8,903		779		4,669	1042.88%	90.68%
Gain on sale of loans		212		2,982		290	-92.89%	-26.90%
Gain on sale of building		2,754		-		-	N/A	N/A
Other operating expenses		54,174		57,532		54,509	-5.84%	-0.61%
Income on a tax equivalent basis before income taxes		32,424		15,222		10,181	113.01%	218.48%
Provision (credit) for income taxes		2,469		(5,704)		652	-143.29%	278.68%
Tax equivalent adjustment		4,740		5,184		4,391	-8.56%	7.95%
NET INCOME (LOSS)	$	25,215	$	15,742	$	5,138	60.18%	390.76%
SELECTED RATIOS:
Per share data (1):
Earnings (loss) per common share	$	0.59	$	0.28	$	0.09
Average common shares
outstanding		42,398,954		42,398,954		42,258,960
Common shares outstanding
at end of period		42,398,954		42,398,954		42,398,954
Cash Dividends per Share:
Preferred Stock*	$	-	$	1.41	$	0.44
Common Stock	$	0.11	$	0.11	$	0.11
(1) Per share data is based on the average number of shares
outstanding during the period.
Basic and diluted earnings per share are the same.
*Including redemption premium in Dec. 2003

SANTANDER BANCORP
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2004 AND 2003 AND DECEMBER 31, 2003
(Dollars in thousands, except per share data)
ASSETS
				As restated
		(Unaudited)		(Unaudited)		(Audited)		Variance
		31-Mar-04		31-Mar-03		31-Dec-03		03/04-12/03
CASH AND CASH EQUIVALENTS:
Cash and due from banks	$	131,001	$	121,552	$	99,183	$	0.32
Interest bearing deposits		51,671		197,782		15,300		2.38
Federal funds sold and securities purchased under agreements to resell		295,725		342,350		278,750		0.06
Total cash and cash equivalents		478,397		661,684		393,233		0.22
INTEREST BEARING DEPOSITS	$	10,000	$	-		10,000		N/A
TRADING SECURITIES		57,808		20,259		42,547		0.36
INVESTMENT SECURITIES AVAILABLE FOR SALE, at fair value		1,347,181		964,660		1,664,311		(0.19)
INVESTMENT SECURITIES HELD TO MATURITY, at amortized cost		832,627		905,574		833,127		(0.00)
LOANS HELD FOR SALE, net		294,874		226,311		297,201		(0.01)
LOANS, net		4,147,714		3,873,606		3,917,566		0.06
ALLOWANCE FOR LOAN LOSSES		(72,802)		(58,967)		(70,572)		0.03
PREMISES AND EQUIPMENT, net		51,747		62,646		61,107		(0.15)
ACCRUED INTEREST RECEIVABLE		36,472		38,481		36,398		0.00
GOODWILL		34,791		34,791		34,791		0.00
INTANGIBLE ASSETS		4,454		5,864		4,662		(0.04)
OTHER ASSETS		178,587		115,155		142,050		0.26
	$	7,401,850	$	6,850,064	$	7,366,421	$	0.00
LIABILITIES AND STOCKHOLDERS' EQUITY
DEPOSITS:
Non-interest bearing	$	704,974	$	627,604	$	700,413		0.01
Interest bearing		3,443,773		3,393,197		3,441,815		0.00
Total deposits		4,148,747		4,020,801		4,142,228		0.00
FEDERAL FUNDS PURCHASED AND OTHER BORROWINGS		315,000		224,700		350,000		(0.10)
SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE		1,686,090		1,270,492		1,808,238		(0.07)
COMMERCIAL PAPER ISSUED		374,753		249,798		254,904		0.47
TERM NOTES		180,750		304,794		165,966		0.09
CAPITAL NOTES		15,925		28,925		15,925		0.00
ACCRUED INTEREST PAYABLE		23,884		26,994		18,728		0.28
OTHER LIABILITIES		148,377		121,643		129,600		0.14
	$	6,893,526	$	6,248,147	$	6,885,589		0.00
STOCKHOLDERS' EQUITY:
Series A Preferred stock, $25 par value; 10,000,000 shares authorized;
2,610,008 shares issued and outstanding in March 2003		-		65,250		-		N/A
Common stock, $2.50 par value; 200,000,000 shares authorized;
46,410,214 shares issued;
42,398,954 shares outstanding in March 2004, 2003 and December 2003.		116,026		116,026		116,026		0.00
Capital paid in excess of par value		211,742		211,742		211,742		0.00
Treasury stock at cost, 4,011,260 shares in March 2004, 2003 and December 2003.		(67,552)		(67,552)		(67,552)		0.00
Accumulated other comprehensive loss, net of taxes		(12,521)		(11,341)		(19,465)		(0.36)
Retained earnings-
Reserve fund		119,432		116,482		119,432		0.00
Undivided profits		141,197		171,310		120,649		0.17
Total stockholders' equity		508,324		601,917		480,832		0.06
	$	7,401,850	$	6,850,064	$	7,366,421		0.00

SANTANDER BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTERS ENDED MARCH 31, 2004 AND 2003
(Dollars in thousands, except per share data)
	For the quarters ended
				As restated
		(Unaudited)		(Unaudited)
		March 31,		March 31,
		2004		2003
INTEREST INCOME:
Loans	$	57,900	$	60,262
Investment securities		27,215		18,153
Interest bearing deposits		132		217
Federal funds sold and securities purchased under
agreements to resell		580		390
Total interest income		85,827		79,022
INTEREST EXPENSE:
Deposits		13,180		16,067
Securities sold under agreements to repurchase
and other borrowings		18,649		19,110
Subordinated capital notes		22		218
Total interest expense		31,851		35,395
Net interest income		53,976		43,627
PROVISION FOR LOAN LOSSES		8,750		12,065
Net interest income after provision for loan losses		45,226		31,562
OTHER INCOME:
Bank service charges, fees and other		9,645		10,231
Broker/dealer, asset management and insurance fees		12,556		11,471
Gain on sale of securities		8,903		4,669
Gain on sale of mortgage servicing rights		91		125
Gain on sale of loans		212		290
Gain on sale of building		2,754		-
Other income		2,471		1,951
Total other income		36,632		28,737
OTHER OPERATING EXPENSES:
Salaries and employee benefits		23,549		21,825
Occupancy costs		3,400		3,276
Equipment expenses		2,164		2,344
EDP servicing, amortization and technical expenses		8,231		8,301
Communication expenses		2,109		1,599
Business promotion		1,680		2,026
Other taxes		2,275		2,569
Other operating expenses		10,766		12,569
Total other operating expenses		54,174		54,509
Income before provision for income tax		27,684		5,790
PROVISION FOR INCOME TAX		2,469		652
NET INCOME		25,215		5,138
DIVIDENDS TO PREFERRED SHAREHOLDERS		-		1,142
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS		25,215		3,996
EARNINGS PER COMMON SHARE	$	0.59	$	0.09

SANTANDER BANCORP
		QTD		QTD		2003
				As restated
		March 31,		March 31,		Year to	Fourth
SELECTED RATIOS		2004		2003		Date	Quarter
Net interest margin (1)		3.42%		3.17%		3.30%	3.48%
Return on average assets (2)		1.40%		0.32%		0.59%	0.87%
Return on average common equity (2)		21.01%		3.02%		6.08%	8.89%
Efficiency Ratio (1,3)		67.71%		75.62%		70.10%	66.15%
Fee income to revenues		29.95%		26.67%		26.92%	24.41%
Capital:
Total capital to risk-adjusted assets		10.97%		13.16%		0.00%	10.41%
Tier I capital to risk-adjusted assets		9.39%		11.91%		0.00%	8.84%
Leverage ratio		6.33%		8.29%		0.00%	6.04%
Non-performing loans to total loans		2.11%		2.88%		0.00%	2.33%
Non-performing loans plus accruing loans
past-due 90 days or more to loans		2.18%		2.94%		0.00%	2.39%
Allowance for loan losses to non-
performing loans		77.74%		49.94%		0.00%	71.74%
Allowance for loans losses to period-
end loans		1.64%		1.44%		0.00%	1.67%
OTHER SELECTED FINANCIAL DATA		31-Mar-04		31-Mar-03		31-Dec-03
		(dollars in millions)
Customer Financial Assets Under Control:
Bank deposits (excluding brokered deposits)	$	3,788.7	$	3,755.6	$	3,782.8
Broker-dealer customer accounts		4,053.1		3,176.8		3,727.4
Mutual fund and assets managed		2,065.8		1,360.5		1,859.0
Trust, institutional and private accounts assets under management		1,326.4		929.9		1,300.6
Total	$	11,234.0	$	9,222.8	$	10,669.7
(1) On a tax-equivalent basis.
(2) Ratios for the quarters are annualized.
(3) Operating expenses divided by net interest income, excluding
on a tax equivalent basis, plus other income,
gain on sale of securities (and gain on sale of building for 1Q04).