ANL Abbey Nat.

RNS Number:3629E
Banco Santander Central Hispano SA
21 October 2004


   NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED
                 STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN


   Recommended Acquisition of Abbey National plc ("Abbey") by Banco Santander
                   Central Hispano, S.A. ("Banco Santander")

                    Outcome of General Shareholders' Meeting


Banco Santander is pleased to announce that, at a General Shareholders' Meeting
of Banco Santander held today, the resolutions necessary to implement the
proposed acquisition of Abbey (the "Acquisition"), including the increase in
share capital of Banco Santander, were duly passed.

The Acquisition remains conditional on certain regulatory and other approvals
including the sanction of the High Court of England and Wales. Subject to the
satisfaction or waiver of the remaining conditions, the Acquisition is expected
to become effective on 12 November 2004.

The following is a translation of the announcement released in Spain today by
Banco Santander relating to the statements made at the meeting:

"THE SHAREHOLDERS' MEETING OF GRUPO SANTANDER APPROVES CAPITAL INCREASE FOR THE
                         ACQUISITION OF ABBEY NATIONAL

Lord Burns will remain as Chairman of Abbey and Francisco Gomez Roldan will be
its new Chief Executive.

Santander, 21st October 2004. The Extraordinary General Shareholders' Meeting of
Grupo Santander today approved the capital increase for the acquisition of the
U.K. bank Abbey National. The transaction will involve an issue of up to 1.511
billion new Santander shares, representing approximately 24% of the share
capital.

The takeover of Abbey by Santander - the largest cross-border acquisition in
European retail banking history and the biggest investment ever made by a
Spanish company in Europe - will place the Group among the ten leading banks in
the world by stock market value. Emilio Botin, Chairman of the Group, said:
"This operation will create value for our shareholders and open up new avenues
for continued growth."

The Chairman reaffirmed the Group's stance on cross-border mergers. "We do not
believe in cross-border mergers of equals, because they do not create value.
Without a single, effective management, they make it difficult to integrate
different management cultures and determine clear business lines." And he
stressed: "However, we do believe in, and have successfully undertaken, many
cross-border acquisitions in the Americas and in Europe. And we have proved that
they create value. The Abbey operation is an acquisition, not a merger. And it
is an acquisition that fits perfectly well into our strategy."

He pointed out that "the Abbey transaction is a great opportunity for Grupo
Santander. He recalled that Abbey was the sixth largest bank in the United
Kingdom and number two in mortgage business, with 740 branches and 18 million
customers. "It has an important retail franchise of great potential. We are
convinced that we can improve its management and its earnings". "It is an
activity we know well, one that fits in perfectly with our multi-local banking
strategy focused on retail banking."

"We have approached this transaction with very clear ideas: we are going to do
what we do best - customer banking", he said. "We are going to strengthen
Abbey's business capabilities and enhance the quality and efficiency of its
products and services. We will do all this without closing branches. We will
take advantage of the competitive advantages afforded by our technology
platform, Parthenon, and our cost control".

Regarding the impact of the acquisition on shareholders, Botin said that "In
this transaction, as in all those we have undertaken in the Bank's history, our
objective is to create value." "We are convinced that the purchase of Abbey is a
good operation for our shareholders". "After the purchase of Abbey, there will
be new investors throughout the world interested in our shares".

Botin reviewed some of the measures to be set in motion immediately after the
approval of the transaction, which would benefit U.K. shareholders, such as the
planned listing of Santander shares on the London Stock Exchange, the payment of
Santander's quarterly dividends in sterling, the Santander share trading
mechanism for small shareholders until listing on the London Stock Exchange and
the setting up of a shareholder relations office in the U.K. He also confirmed
that U.K. shareholders would enjoy the same advantages as those presently
available to all other Santander shareholders.

Botin announced that the Bank's Board had decided, subject to the successful
conclusion of the transaction, that Lord Burns would remain as the Chairman of
the Board of Directors of Abbey National and that its new Chief Executive would
be Francisco Gomez Roldan, until now the Group's Chief Financial Officer.

Alfredo Saenz: "All energy can now be focused on retail banking, Abbey's core
business, and developing the franchise's capacity for growth."

The 2nd Vice Chairman and CEO, Alfredo Saenz, began his address by explaining
Grupo Santander's business model, a retail banking business model that is
adapted to each market, built on three basic pillars: obtaining critical mass in
relevant markets; a strong sales and customer service culture and strict cost
control.

The CEO listed the initial priorities for Abbey: reinvigorating its sales
capabilities, strengthening distribution through its branches, reducing
operational costs (especially in technology and the rationalisation of
back-office operations) and finally, the sale of non-strategic assets.

"We believe there is a wide margin for improvement, both in costs and revenues",
he stressed. He recalled that cost savings were estimated to reach 450 million
euros over three years, whilst revenue synergies were estimated to reach 220
million euros in 2007.

Saenz summed up in numbers the size of the enlarged Grupo Santander: among the
top ten banks in the world by stock market capitalisation, based on yesterday's
Grupo Santander share price, of more than 50 billion euros; more than 600
billion euros in assets, with a customer loan portfolio of 335 billion euros and
deposits of 245 billion euros, based on end 2003 figures. The enlarged Group
would have 59 million customers, 9,940 branches and 131,000 employees."


Enquiries:

Banco Santander
Keith Grant (Head of International Media)   + 34 91 289 5206
Peter Greiff                                + 34 91 289 5207

Maitland
Angus Maitland                              + 44 20 7379 5151
Philip Gawith
Martin Leeburn

Brunswick
Rurik Ingram                                + 44 20 7404 5959


The availability of the Acquisition to persons who are not resident in the
United Kingdom may be affected by the laws of the relevant jurisdictions in
which they are located. Persons who are not resident in the United Kingdom
should inform themselves of, and observe, any applicable requirements.

This announcement contains forward-looking statements within the meaning of the
US Private Securities Litigation Reform Act of 1995. Forward looking statements
may be identified by words such as "expects", "anticipates", "intends", "plans",
"believes", "seeks", "estimates", "will" or words of similar meaning and
include, but are not limited to, statements about the expected future business
and financial performance of Banco Santander resulting from and following the
implementation of the Scheme. These statements are based on management's current
expectations and are inherently subject to uncertainties and changes in
circumstance. Among the factors that could cause actual results to differ
materially from those described in the forward looking statements are factors
relating to satisfaction of the Conditions, Banco Santander's ability to
successfully combine the businesses of Banco Santander and Abbey and to realise
expected synergies from the Acquisition, and changes in global, political,
economic, business, competitive, market and regulatory forces. Neither Banco
Santander nor Abbey undertakes any obligations to update the forward-looking
statements to reflect actual results, or any change in events, conditions,
assumptions or other factors.

This announcement does not constitute an offer for sale of any securities or an
offer or an invitation to purchase any securities in any jurisdiction. The New
Banco Santander Shares will only be distributed to existing Abbey Shareholders.
The New Banco Santander Shares to be issued to Abbey Shareholders under the
Scheme have not been, and will not be, registered under the U.S. Securities Act
of 1933, as amended, or under the securities laws of any state, district or
other jurisdiction of the United States, Australia, Japan, Malaysia or Italy and
no regulatory clearances in respect of the registration of New Banco Santander
Shares have been, or will be, applied for in any jurisdiction (other than as set
out in the following paragraph). In the United States, the New Banco Santander
Shares will be issued in reliance upon the exemption from the registration
requirements of the U.S. Securities Act of 1933, as amended, provided by Section
3(a)(10) thereof. Under applicable US securities laws, Abbey Shareholders and
holders of Abbey ADSs who are affiliates of Abbey prior to, or will be
affiliates of Banco Santander after, the Effective Date will be subject to
certain U.S. transfer restrictions relating to the New Banco Santander Shares
and the New Banco Santander ADSs received in connection with the Scheme.

The provincial securities laws in all provinces of Canada, other than Quebec,
require the first trade in the New Banco Santander Shares to be made through an
exchange or a market outside of Canada or to a person or company outside of
Canada or otherwise on a prospectus exempt basis under such laws. In addition,
when selling the shares, holders resident in a province of Canada other than
Quebec must use a dealer appropriately registered in such province or rely on an
exemption from the registration requirements of such province. Banco Santander
will apply for a ruling or order of the Financial Markets Authority in the
Province of Quebec to exempt the first trade or resale of New Banco Santander
Shares issued to Abbey Shareholders resident in the Province of Quebec from the
prospectus and registration requirements of Quebec securities legislation.

Capitalised terms used but not defined in this announcement have the meaning
given in the scheme document dated 17 September 2004 relating to the
Acquisition.





                      This information is provided by RNS
            The company news service from the London Stock Exchange

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