Good morning. To begin the presentation of results for 2010, I’ll review the main highlights of our management in the year, and then Jose Antonio Alvarez will review the Group’s results, and we’ll go into the different business areas in further detail. Finally, we will conclude with our perspective of the coming quarters. I will start by reviewing the six main highlights of the year, which I will discuss in a moment, and which I will cover in more detail in the next slides. First, the Santander Group’s ability to generate high recurring results in a difficult market environment. Our diversification and management strategies adapted to each market have enabled us to obtain profit of EUR8.18 billion. Secondly, nonperforming loans have improved their trends and such significant units of Santander Consumer Finance, Brazil, or Sovereign have significantly improved their NPL ratios in the year. Third, we have markedly improved our structural liquidity position after attracting this year, a combination of deposits, and medium and long-term issues for a total of a EUR147 billion, which is double what is needed for the business and for maturities in the year. Fourth, we have ended 2010 with very solid capital ratios. Our core capital has increased to 8.8% after increasing 33 basis points in the last quarter. Fifth, we continued to offer high shareholder return and are planning a total payout for the year of EUR0.60 per share. Sixth, today, we have a more diversified portfolio than a year-ago and we have increased our presence in the countries that have a greater growth potential. Let’s now look at each of these highlights in more detail. Profit; starting with profit, in the fourth quarter, we have continued to grow our recurring profit with a total in the quarter of EUR2.1 billion, and for the…

Good morning. Continuing with the CEO’s presentation, I’m going to review the Group’s results and then the business areas. I’d like to remind you that, on the website, you will find presentations with more detail on the main units and Spain. On the slide, you can see our income statement where we usually present it. The first column changes is based on our accounts and the other reflects the exchange and perimeter effect. General conclusion about the statement that the underlying trend is still bringing in consistent solid basic revenues in an environment where there has been a low growth in lending, negative in some mature markets, and with interest rates at record lows, which are, of course, affecting the profitability of the lending business, but at the same time there has been an increase in wholesale financing costs. I’d say that there has been overall very good cost management in the Group. Costs have grown 2% overall. I’ll talk in a little more detail by areas about this later. And recurring provisions have dropped by 8.5%, because a good part of our businesses have already turned the corner in the trend of raising NPLs. Net of these three items has produced the 3% increase in net operating income which is not reflecting in the bottom line, because of that one-off our CEO mentioned, for applying the Bank of Spain’s new circular in Q3, greater tax burden due to the diverse tax pressures in the markets where profits been generated, we’re generating more profit in countries where there is a greater tax burden, and because of higher minority interests, because of the increase especially in Brazil. If we look at the different details in the statement, you can see that there are more commercial revenues, that is net interest income…

Right, we’ve already reviewed the Group’s strategy and its evolution. And my summary is that, 2010 was another good year for Santander. The Bank had met the challenges of a very complex environment and obtained good grades in key aspects, generating high profits, keeping NPLs under control, strengthening liquidity and capital, giving shareholders a high return, and improving the Group’s strategic potential. This gives us a solid starting point for 2011, a year when management will again be tested. We have three focuses for 2011. The first of these is to generate value in three very different business environments, more demanding markets for business such as Spain and Portugal, other developed economies where we expect to have positive news as a result of their recovery such as the US, Germany and the UK, and the emerging economies where no barriers to grow, which will continue to drive business. The second focus is to integrate during 2011 and 2012 the latest acquisitions. This is going to take place not only in 2011, but also in 2012. And thirdly, to maintain a strong liquidity and capital as critical variables for management. And I will look at each one in more detail. The first idea is that Santander will develop a clearly differentiated management of its business drivers on the basis of the macroeconomic and financial environment of each market. In Spain and Portugal, we expect a slight fall in loans while deposits will pickup, which will make us put the maximum emphasis on spreads, costs, and in recoveries. Meanwhile, we will be very demanding in provisions, although we see a reduction in specific ones. In consumer, the UK and the US, we see a moderate recovery in volumes as these economies get back on their feet. Here we will actively manage spreads…

Good morning. As usual, we will continue to review the questions that come in over the webcast, and then we will look at the questions we’ve received over the phone. Well actually we have many coming in over the Internet. I’ll start with the subjects starting with strategy and regulation. There are several questions from Britta Schmidt at Autonomus; Carlos Peixoto, BPI; and Antonio Ramirez, about our plans for an IPO in the UK for going ahead with those plans, if we still think it’s possible to do it in the next semester of 2011, and what kind of evaluation are we thinking we can obtain?

I’ll confirm our intention to carryout the IPO in the second semester, we can confirm that. We had already announced that that was the plan. And we will meet that target second semester, that was the first half of your question. And the second, evaluation, I don’t think now is the time to talk about that. We’ve not given any kind of guidance. This is something that we’ll talk about when the time comes when we’re in the final stages of the IPO.

There is a set of questions about Poland, the Poland project; Britta Schmidt, Carlos Peixoto. When do we expect to close that and finalize that, will we be taking it? Well, you know that we’re awaiting the approval of the local regulator, and when that happens we will let the market know. We can’t really say anything more than we have said with regards to our expectations on that. There’s a lot of questions about Spain too and the restructuring of this industry in Spain; Britta Schmidt, David Vaamonde from Fidentiis, Sergio Gamez from Merrill Lynch, Andrea Filtri from Mediobanca and Benjie Creelan from Maguire. And basically I’m going to try and summarize. And the question is, are we interested in savings banks in terms of an organic growths or acquisitions? Do we think it’s fair to apply different capital requirements to different banks whether listed or not? And what organic growth do we expect for the next three years or do we expect to also grow inorganically through acquisitions? And organic growth for this sector in Spain in general. In terms of volume I suppose they mean, forecasts and prospects for these Spanish banking sector.

Right. As for the Group’s position with regards to the restructuring of the savings banks, I think it’s early days yet, since the process has only just started. And we still need to learn in more detail about how this process is going to evolve. So I’ll just say, for now, that we think there will be opportunities for investors clearly in this process, especially in the initial stages of the capital injections, but it’s I think early days to say whether our Group is going to be interested in playing an active roll in this process or not. As for the different capital requirements, that’s something where clearly of course the market will eventually put everyone in their right place in terms of capital requirements over and above regulatory requirements. But regulatory requirements are pretty similar in both cases, and always dependent on risk profiles and business profiles for each bank. As for organic or inorganic growth prospects, it’s really hard to predict the future. But our current expectation is to grow organically. The Group still has significant potential for organic growth, over and above the acquisitions that are currently in the pipeline of course like Poland and the Royal Bank of Scotland branches, which are still pending finalization. But beyond those acquisitions – and I mentioned SEB, because that’s already closed. Our plan is to grow organically in the next years in order to really draw out all and extract all the value that we can still capture in the UK, and Germany, and the US, and Brazil, where the integration process and the restructuring process continues to draw values. So in the near future we expect mostly to grow organically, mostly.

Okay. And as far strategy and operations, there is a question from Rohith Chandra about whether we’re still thinking about other IPOs apart from the UK, and he specifically mentions Mexico. I don’t know if you want to answer that.

No decision has been made on that, so I can’t really say anything. We’ll have to wait and see what happens. No decision has been made.

Sergio Gamez from Merrill Lynch is asking about management changes. There has been changes in the management of some business units, which represents about half the profits of the Group. Do we expect any new strategic plan for these units or are we going to go on as we have until now?

Well, of course, the individual managers have their own personal style. But beyond that in the two major markets where there has been changes in the management, Brazil and the UK. In both cases the plan is to continue with the same strategy, with the same model, with the same focus for the business, which is the Group’s model, and that’s not changed since the time when we acquired these companies. Although, of course, always adapting to current circumstances.

And finally to end with the strategy subject, two questions that I can combine. Neil Smith and Luis Pena from JB Capital asking about the outlook for 2011; what’s our biggest concern? And how could that impact us? And what outlook do we have for profit growth in 2011?

Well, our outlook is positive, and I think we’ve said it in the presentation, or could be understood from what we said in the presentation that in three quarters of the markets where we have our presence, and that means both mature markets that are undergoing recovery like the US and the UK and Germany, and more specifically in the emerging markets like basically the Latin America, but also Poland when that part of the Group – from these markets we expect to have a very good year. And so, the overall result with these markets that are growing strongly and so we can expect them to bring in significant growth in profit. And those markets where microeconomic circumstances are not yet ideal but which nevertheless for different reasons either because of the perimeter effect or the internal restructuring or our own internal factors, we expect good results too. Excellent, in fact, from the emerging markets again. In Santander Consumer Finance, again, without a geographical perspective, I said already in the presentation as Jose Antonio Alvarez when he talked about this division, we also expect that to bring in significant growth in profit in 2011. In fact, it had a very good 2010 too, because that’s a unit which is ahead of the rest of the business in the cycle. It solved the problems it had in 2008 and 2009 with NLPs and is in really accelerating its growth. So the only concern or you were asking about our biggest concern, and our biggest concern basically is Spain and Portugal, where we still expect to have a difficult 2011, because the economy is still slow and volumes will not recover as yet, that’s why we said since we expect less volume and less business in those markets in comparison with 2008 or 2009, we will focus our efforts on our spreads, our costs, our recoveries, risk quality, so all those aspects of our management. Having said all that, our outlook for next year is optimistic, positive definitely.

Right, moving on to financial management or financial area, there are several questions about capital; Sergio Gamez from Merrill Lynch, Arturo De Frias from Evolution, Marcello from Bernstein, Antonio Ramirez from Keefe and Francisco Riquel from N+1. Questions are what capital levels do we expect to have in 2011? How much capital will you generate organically given that in Q4 you’ve reported 20 basis points of organic capital generation? Does this mean we’re going to increase our guidance from 10 basis points, 15 basis points per quarter? And, basically, are we still not thinking of the capital increase, especially if your UK IPO doesn’t happen? And do we think that organically we can reach 9% or 10% core capital only from profit generation and the scrip dividend?

Okay, the guidance we had issued was 10 basis points, 15 basis points of organic capital generation per quarter. I’d say from now on, probably more like 15 basis points, because of what we’ve said in terms of the growth in volumes we expect basically in mature markets. When I say volumes, I mean volumes in lending will be growing strongly in emerging markets, but overall the Group’s loan portfolio, emerging markets represent less than 20%. Although that percentage will be growing at 20% rates and it’s true so that our loan portfolio mature markets, which is now 80% will be growing very little, and in some cases will even be shrinking, I’d say high as this year. So we expect good organic capital generation probably at around 15 basis points per quarter. We’re certainly not planning a capital increase, because with this kind of rate of capital generation plus scrip dividends, we’re talking about annual capital generation of almost 1%. So really – and using out relatively little. So we think that organically we are generating more than enough capital to continue with the kind of payout policy and to reach ratios at around where we are now which are more than comfortable.

Capital increase, you want to add any thing?

No, not planning a capital increase at all. Not going to do capital increase, no.

There is a question about – Rohith Chandra about – from Citi about the 550 million reduction in capital, whether that has added 10 basis points to core capital in the quarter. The answer is no. It’s true that there are these 500 and some million impact on the capital, because of the adjustment both in equity and fixed income and currency. But those are very similar amount about 500 million, which is offset by increasing goodwill, so net the impact is practically zero. There is a question about the impact of the SEB acquisition on our core capital from Andrew Lim, Matrix, how much core capital is that going to use out? That’s approximately 10 basis points – 8 basis points exactly. And it will take place as we’ve mentioned through out the first semester of 2011. We have more questions about how we expect to close the year, which we’ve already mentioned. Whether we can give an update on the impact of Basel III; no change as we said 70 basis points, 75 basis points used up. We gave you the breakdown previous semester about the different items. Question from Neil Smith, I don’t know, Jose Antonio you would like to elaborate, he is ask – saying that the ECB published its – the case on December 16th, estimating an impact on banks in Europe in general and that Santander sent its own figures. And can we say something about the case and where it might be the impact of Basel III, I’ve already said that. Do you want to elaborate?

I think basically it’s widely known. There is no really and lot else to add to the known impacts of Basel III. We’ve discussed already. It’s true that there is still an ongoing discussion about some elements, not really whether it’s Basel III or what it is, anyway the regulatory framework for the large systemic important entities for countercyclical buffers too, but that still has to be debated by the EU. They’re still discussing what is called the capital directives CRD4 which will transpose to the EU’s regulations, the principles that have been defined by Basel, but that’s still happening. So as far as we know, we’ve given you those numbers of 70 basis points, 75 basis points. And when we have more information we’ll give you a more detailed response.

To finish with capital, question from Andrea Filtri from Mediobanca; are we still thinking that the RBS acquisition will be finalized at the end of this year or the next?

Probably it will be finalized at the beginning of 2012, given the carve-out process which is taking place in our transaction. But in any case that calendar we reported before still applies.

As for the corporate center, there are several analysts, David Vaamonde from Fidentiis, Sergio Gamez from Merrill Lynch, Rohith Chandra from Citigroup, Arturo De Frias from Evolution, Frederic Teschner from Natixis, who are asking basically about two things. The evolution of our net interest income especially in 4T comparison with 3T, can we clarify that trend, and bring the ROS and the outlook for 2011, given the increase in financing costs we are seeing. And what do we expect from the top end and the bottom end of corporate?

Well, as for in the past, I think I explained that difference ‘10 versus ’09, and also Q4 2010 versus Q3 2010. Speaking about our outlook to predict the margins for the corporate center, we have to have several caveats, interest rates, of course, because it’s not the same if they’re raising and if they’re dropping or stable, since there is finance for the holding company which is there. So if interest rates are higher, our net interest income is lower. Also the perimeter has an impact, the size of the holding varies. And so if goodwill is generated or decreased, financing volume increases, and also the cost of finance of course self finance to finance corporate. Basically in principal, with stable interest rates and constant perimeter, we would had some negative impact from raising wholesale financing costs and some negative impact from goodwill generation, because of the investment in Poland. It’s been more difficult to predict the cost of the carryover of our currency hedges, which were particularly well in Q4. But in principal, both Mexico – hedges in Mexico and Chile are closed for the whole of the year, so no changes are expected. Brazil hedge is shorter term, and so we will have an impact from interest rate variations in Brazil, and Pound versus the Euro, that also affects us. Of course if the hedge is greater, the greater it got, but that’s just the usual run of this business, it’s hard to be specific about our number. But you can calculate your estimates from what I’ve said.

As for ALCO portfolios, Francisco Riquel and Antonio Ramirez from Keefe are asking about contribution of these to our net interest income. And Britta Schmidt is asking about issuance plans for 2011. We’ve already talked about maturities in this presentation. Will we be covering or replacing all maturities or not? And what financing costs do we expect in 2011 versus 2010?

Our core portfolios, I think we’ve said that there is approximately – this is basically public debt EUR15 billion in the parent, EUR5 billion in Banesto and EUR3 billion or EUR4 billion in Portugal. In Brazil, there is a portfolio of about EUR9 billion. In Mexico, approximately EUR4 billion. The rest are smaller around EUR1 billion and EUR1.5 billion. Contribution to net interest income in the year I’d say in the Euro area about EUR500 million – EUR550 million, and in different markets or countries, probably around EUR100 million in Mexico and in Brazil maybe about $250 million. So those are the portfolios. Usually the maturities which is the usual question in euro areas, 2.5 years to 3 years; in Brazil shorter; and in Mexico very short term, probably 1.5 years on average. Second question about issuance plans, we said in the presentation – I think our CEO said, that we have – we plan to be quite active in the UK, we have the majority of that special liquidity scheme in the UK. And so we have to replace that special liquidity scheme which was created in 2008, so we’ll be quite active there. More active than last year in Latin America, especially in Chile, because there is strong growth in lending, and so we will be more active. Certainly more active in Brazil and slightly more active in Mexico, but only slightly, not very much, because excess liquidity in the deposit-to-loan ratio is still significant. As for the Euros zone, as we said in the presentation, maturities are some EUR20 billion this year and then the next, and the following about EUR15 billion. We’re deleveraging so we think in principal we will be issuing a lot less. So if it’s EUR25 billion round figures, maturities, we think that commercial gap might be EUR10 billion under ordinary circumstances. And since we’re providing less finance for consumer finance, so in the past a good part of that was financed by the parent, but now it’s increasingly self financing. In 2009, it was EUR14 billion; at the end of 2010, it was EUR9 billion; and we think that it will self financing in 2012. So the parent Portugal and Banesto will have less issuance needs then we’ll issue relatively little. And as for the costs, I think that was the final question, financing 2010-2011. Right now your northern market is – our expectation is that cost will drop, Sovereign risk will drop very significantly, it has been dropping in the last few days, but we expect those drops to continue, and so we expect that there will be more normal, let’s say, more normal. But if only will go back to the levels before the crisis, but at least within the period of this crisis when the financing costs were about 70, 80, 150 basis points depending on the instruments on the terms. So that’s what we would expect for 2011 overall.

Okay. And to finish this chapter, Raoul Leonard from RBS was asking specifically about closing the commercial gap. You’ve just mentioned it, so no need to answer again. As for credit quality in the Group, there is questions from Britta Schmidt, from David Vaamonde, from Marcello Zanardo and from Raoul Leonard to, how do we see the evolution of lending quality? In the year, there has been an increase with net additions in Q4, how do we expect risk quality to evolve? Do we think it’s going to continue to worsen? And what’s the trend we expect for 2011 and 2012, for risk quality?

For the Group overall, we showed you in the presentation, there have been improvements in NLPs in all markets, except Spain and Portugal I think it was. That’s going to be particularly intense in the US, where we’ve had significant improvement, but it will depend on growth in the different segments in emerging countries. In Spain and Portugal, we probably think that they are still going to be some slight increase at least in the first half of the year in Spain. I’m talking just a few basis points. We finished at 4.24 I think, so maybe it will raise to a peak of maybe 4.5 or 4.47, but thereafter it will stabilize and then begin to drop. In Portugal a slight rise, but not significant, we’re at 2.9, so not significant. If we translate this to the Group overall, I can’t actually translate what that means mathematically in the rest of the Group, but probably quite stable or even slightly down, but can’t really calculate off the top of my head exactly all the weight of the different units. And in the UK, I did mention it we don’t have any concern over credit quality.

And specifically as for risk quality for Spain, there are questions about the evolution in Q4, worsening in Q4, anything specific; Francisco Riquel from N+1 is asking this. How do we expect Spain to behave specifically quarter-on-quarter basically? Carlos Peixoto and Fredric Teschner, one from BPI and one from Natixis are asking this question. And specifically on the income statement, Britta Schmidt is asking do we expect provisions to increase or decrease versus – since we’ve used the EUR2.1 billion during the year. Question from Britta Schmidt.

I think I explained this. All goes hand-in-hand. We think that NPL will rise slightly in the first half, in the fourth it could be stable or go down slightly. And the impact on our P&L, we’ve said that’s generic for two quarters. Then we may have a slight bigger impact because of the net, but we think specific provisions should go down. But the net impact on our fixed income statement will be greater, because of their lack of availability of generic provisions from Q3.

There is question from Fredric Teschner in Natixis about our dividend or payout policy. No change, still the same, 50% payout for dividends, to scrip dividend, which will be paid in the dates that had been announced. As for generic provisions in Spain, there are several questions from Rohith Chandra again. Given the use in Q4, how much do we expect to – how long do we expect our generic provisions to last and what will be impact thereafter?

I just said just now, we have two quarters. Of course, the Group’s policy is if when there are capital gains, we usually provision generic provisions, but as I said just now.

There is a question on strategy from Neil Smith. He is saying, that the euro zone has announced the possibility of a European bank levy. Do we think that’s a risk, will it apply to Spanish banks and do we think that it could have some kind of impact on the sector? I don’t know if you want to answer that.

Well, bank levies are not good obviously, but we don’t have any news or any indication that the Spanish government might be thinking of applying one in Spain.

Moving onto real estate exposure, Andrea Filtri from Mediobanca, he is saying thank you very much for this new clearer reporting on risk in the construction sector, no other bank has done it so clearly. So thank you very much Andrea for that praise. And as for specific exposure there are several questions with regards to what it – what this real estate purpose means or it doesn’t mean or what’s the NPL rate, the substandard. All of these specific details are in the appendix or the annex to the presentation. You have all the tables with all that information. I think we’ve given all the information required or even more. But any case we can answer you all your specific questions after this webcast. And there is a question from Andrea Filtri, do we expect to continue buying back assets on what rate? And what is our policy with real estate assets in general?

Well, our policy, I think you know. There have been some small increases, but buyback policy stopped I think 1.5 years ago and we’re still maintaining. We have had some of asset allocations as part of a normal recovery process, allocations generally through the courts.

Continuing with construction and real estate, David Vaamonde is asking about intra-Group balances you mentioned in the presentation when you talked about those EUR440 billion, can you elaborate a little more there and the composition of those EUR440 billion?

Well, I don’t actually have the information to give you the breakdown of the EUR440 billion, because that’s the whole sector and I don’t have the information. But what I can tell you is the intra-Group balance, when we incorporate a company for real estate assets, ours is called Altamira, it buys those assets with a loan awarded by the bank which eventually falls statistically as part of those EUR440 billion. And so as not to count the same as real estate loan and as allocated asset that’s why I say net, in our case it’s EUR4 billion. About EUR4 billion are the loans granted by the bank to Altamira to buy these – or hold these allocated or acquired assets. And in the sector, I suppose there are different practices. There are banks that keep those assets in their balance sheet and others have it in a separate company. And, of course, you can endow that company with capital or with loans. But I can’t really give you more details about what those EUR440 billion the sector contains. In our case, it’s those EUR4 billion in Altamira I’ve mentioned.

There is a question from Andrew Lim from Matrix. He says the following; the coverage ratio of the loans to real estate developers and construction companies is 28%. How can we justify this coverage ratios which is so low?

Well, I think he is referring to doubtful loans plus substandard, the EUR9.5 billion. I think I said during the presentation that 75% by definition – by definition all sub standards have made their payments of interests and principal, and 50% of those classified as dubious or doubtful have covered – have paid the interest plus principal. Therefore, the coverage of 28% over a portfolio were only 25% is in arrears. We think based on our estimates is the right level of coverage for this portfolio. In effect, I remind that 75% has made its payment on a timely basis and 25% are in arrears. But that’s a substandard portfolio because of the sector, because of the client in some cases – and well those are figures that I gave during my presentation.

To finish with the risks department, there is a question on the very slight increase in the charges for provisions in the quarter in Brazil. Nothing special to mention there, this is basically the growth of the portfolio in business as usual. And the different ways of the different credit qualities, but there is nothing specific there in the quarter. Andrea Filtri ask whether we think that the evolution of the results in Brazil is sustainable? Is that growth of profit sustainable in Brazil?

I would say absolutely so. Our forecast for Brazil – and I don’t think we are very original there – is favorable we think that lending will continue to grow despite the increases and reserves and despite the increase in interest rates, we do think Brazil will continue to grow significantly so, and the spreads will be in line with the ones we have now. We think that the scenario to generate revenue in Brazil is favorable, credit quality is improving and will continue to improve. And there is a general pressure on cost, because of wage increases, but we are undergoing an integration process, so we should outperform our competitors there, therefore we do think these profits are sustainable.

Yes, if we now look at the different business areas, in Spain, there are several questions on the net interest income. Let me start with Sergio Gamez from Merrill Lynch. Deposit retention campaigns, what is our best estimate on the retention of deposits and what do we think will happen in the next few quarters? I guess he is referring to the campaign we rolled out on the second half of last year.

Well, more than the campaign the net interest income – the worst about the net interest income in Spain is probably over. That was a period in July to October, because the appreciation of the mortgages stopped, it went down to minimum levels. Now, the Euribor is going up, that’s an important impact as well as the campaign which was a negative effect. On the last quarter, the customer spread has improved by 2 basis points as compared to the previous quarter. We think that the fact that mortgages are growing, the fact that there is less intensity in the campaign for deposits. An increase in spreads on assets that will give rise to increases in the net interest income in the next few quarters. Of course, the first quarter of 2011 will be below the first quarter of 2010, we might tie in the second quarter, and from there on the net interest income will clearly be better than in 2010. That is our outlook and that is – and there we include the results of the campaign to gain more deposits. And there is going to be less competition for deposits and these deposits will re-appreciate with a downward bias. We have about three and a half products per client that we attracted with our deposit campaign, so the performance we think is going to be reasonably good as compared to other retention campaigns.

Rohith Chandra asked about the net interest income and the performance compared to the customer spread; that you just answered that question. Antonio Ramirez is asking about the competitive environment in deposits. Is there going to continue to be pressure on deposits? You just answered that question as well that things are quieter on that front. Brazil; Carol Peixoto is asking about the impact we expect from the increase in compulsory reserve requirements in Brazil and what volume growth do we expect in the year.

The truth is at the impact of this type of increase in reserves we don’t think it’s going to be too large. Federal Bank is saying, in its estimates, that the impact is going to be of 1 basis point and double-digit growth in terms of volume from 15% to 20% volume growth, which is what we’ve been saying the past year. So we’re – we still have the same forecast.

England; UK, Manolo Fernandez [ph] is asking about the performance of the business particularly on the top part of the P&L. Do you see any weakening in revenue or net interest income? And can we give any forecast on whether anything is happening there and what we think will happen this year in the UK?

Well, with regards to the net interest income in the UK, the business spreads remain the same, and assets and liabilities. We don’t see any changes in business spreads, the mortgage spread, as well as the spread on deposits remains as – the same as in previous quarters. What has changed basically is that there is a higher cost because of the liquidity regulation which is introduced in the second quarter of 2010. We think we have absorbed in the year two-thirds of the total cost of this new liquidity regulation, but there is still a third that will be absorbed in 2011. And from there on we’ll go back to business as usual. So that’s part of the impact. But I think it’s 250 million pounds or 300 million pounds that will be the total impact. And we’ve already absorbed in 2010 two-thirds of that. And as I said the commercial activity continues to be the same, we have the same spreads and the same volume of activity that I showed you in the presentation.

And there's a question from Arturo De Frias about the UK, about the commercial contingencies, the provision of EUR74 million that me made. This is reasonable giving the situation in the UK. We’ve another question on – about the UK on the net interest income, but we already answered that question. There is a question from Pierre Alexander on the litigation in the UK. I guess it’s just what we said about the contingencies, otherwise you please get in touch with me and we’ll answer your question. And then, there is a question from Benjie Creelan from Macquarie. If there was a rise in interest rates soon in the UK, would that have a positive or negative impact? How do we see the outlook of interest rates? What impact could interest rates have particularly in the UK?

Well, in general terms, and in the UK more specifically, the rise in interest rates, I can give you the figure, because we did a standard analysis to see how it would change by 100 basis points, while the net interest income would improve by – I think it’s 3% or 4% with a 100 basis points in change. In most of the units, with a greater or lesser intensity we’re at the more or else the same level. The balance sheets are positioned for an increase in interest rates for impact of a 100 basis points. That will be 3% in Continental Europe and 0.5% in the UK will be impact. And the same thing for Sovereign or a little bit more and thus so in the Latin American countries where balance sheets are relatively close. But generally speaking, the balance sheets of the matured countries are positioned to face rises in the interest rate.

Ignacio Cerezo of JP has a question on the impact of the change of perimeter in the P&L. Also in the UK for the time being this is just having a very small impact or almost no impact, so I would say that there is no change, no impact from a change in the perimeter. And there is a question from Ignacio Ulargui on the Bank's view on the regulatory environment in the UK. How do we see the situation – the competitive situation in the UK and how do we think it’s going to evolve the regulations as well as the competition in that country?

I don’t see that there is anything specific in the UK other than Basel or other things that we mentioned for the European Union. Since the UK is part of that, and therefore the regulations will be the same, we’ll follow the same guidelines.

We have a question from Arturo De Frias on generic provisions. What will happen if we run out of them? We will have to make further provisions. It depends on two things, the cost of risk and variation of the book or the order book. We don’t expect changes in that and the evolution of the cost of risk will determine that. But it doesn’t look that we’re going to see significant changes. With regards to Portugal, Andrew Lim from Matrix has a question, asking whether Portugal is if it’s intervened or if it’s bailed out by Europe, will that force Santander to take on more provisions in the loan book in Portugal as has been the case of some banks with loans in Ireland. And Inigo De Guevara [ph] from Avaco [ph] would also like to ask about the net interest income. And Portugal, can we give any outlook on the NI either?

Well, the first question you talked about the loan book. In portfolio the NPL rate is low 2.9%. When you take provisions for loans in other countries is because the quality is bad, the quality of the portfolio in Portugal is good. And even if there were bailout, we think that – well we will have to see the impact that would have on the economy. And if the NPL rate goes up, in that case, we would require making further provisions. But additional one-off thing we don’t think there is going to be a significant change in the portfolio. The net interest income, well the situation is quite similar to Spain, but there are a few differences though. The spread on assets are going up as they are in Spain and significantly so. The deposit market continues to be a very competitive market and competition hasn’t gone down as much as it has in Spain, so it’s still very competitive market. And on the side of volumes, we already mentioned that in the presentation there is a difference which is that mortgages in Portugal and we appreciate it every six months instead of every year as in Spain. So they re-appreciate faster.

And to finish, Benjie Creelan is asking about Brazil. The growth in volume in Brazil, we already mentioned that. And the last question is from Kevin Roger from Sujin [ph], asking about Santander Consumer Finance. The – he says we’ve presented a very strong net interest income, but the fourth quarter compared to the third quarter is flatter, could we give any details on the asset and liability spreads, the evolution, whether we depend on wholesale funding which has grown and the cost of retail deposits which are going up, but there aren’t many of those with the exception of Germany? Would you like to add something to that?

Well, the performance of the business has been very good with an increase in the spreads. The business in Germany is financed 100% by deposits. In the US and in the other countries, we are doing securitizations and therefore a high percentage has been funded with that. And as I mentioned earlier, the funding of the parent company has gone from EUR20 million to EUR9 million, has gone down, and I think the business will fund itself at the end of 2011 or beginning of 2012, developing its own issuance tools in each local franchise. The – we’re very positive with regards to the business in terms of revenue as well as in provisions for 2012, but we think that the business will continue to grow well or very well in 2012.

Very well then, so with this we close. If there are any questions that have not been answered, please do send it and we will answer. Thank you for coming and we’ll see you next quarter.