Scottish Highers Business Management Case Study: Santander UK plc is a bank based

Question

Santander UK plc is a bank based in the United Kingdom (UK), wholly owned by the Spanish Santander Group. The bank has around 18,000 employees, 14 million active customers, a retail network of around 450 branches, and 64 business support centers. The bank is the third largest retail mortgage provider and the fifth largest commercial lender in the UK.

Services

Santander UK plc is one of the leading financial service businesses in the UK, offering a wide range of personal and corporate financial services in addition to accounts, such as current, saving and investment accounts, credit facilities, and mortgages. In addition, Santander UK operates online banking services, including a smartphone mobile app.

Branch closures

As a response to long-term trends in customer behavior, Santander UK plc recently downsized its branch network by 50 branches, resulting in over 800 locations. This decision was made amid claims that during the pandemic, many customers are choosing to carry out their banking online.

Santander UK stated that its online banking service allows customers to do all their banking from home. Data shows that more than 90% of everyday banking transactions now take place online, due to the increased preference for digital banking channels.

Financial market

Santander UK faces strong market competition, in particular, due to the rise of the UK mortgage sector. The bank has made significant investments in enhancing its online banking services since the onset of the pandemic to attract new customers. In a recent customer survey commissioned by the government, Santander UK scored 54% for customer satisfaction, among the lowest in the banking sector.

Independent service quality survey results

As part of a regulatory requirement by the government, an independent survey was conducted to ask customers of the 17 largest banks in the UK if they would recommend their bank’s customer service to friends and family.

Customer service ranking of UK banks in 2022

1= monzo 81%  
2= Starling Bank 81%  
3= first direct 79%  
4= Nationwide 78%  
...  
10= Santander 54%

(Exhibit 1 shows an extract of the business banking product portfolio for Santander UK plc.)  
(Exhibit 3 shows a sample of Santander UK plc's Income Statements by banking segment.)  
(Exhibit 2 shows the Santander UK plc branches which have been closed)

Extract of the business banking product portfolio for Santander UK plc

Current Accounts  
For professional, day-to-day banking, where accounts can be setup with an overdraft from £500 to £25,000.

Commercial Mortgages  
Secured against property.

Asset Finance  
Purchase equipment or vehicles using hire purchase.

Loans  
Borrow from £2,000 to £25,000.

2021 financial performance  
Sales Revenue  
Personal banking £m 3,561  
Business banking £m 2,983  
Other £m -130  
Total  £m 4,499  
Profit/(Loss) for the Year (before tax)  
Personal banking £m 1,773  
Business banking £m -202  
Other £m 282  
Total  £m 1,845  
2020 financial performance  
Sales Revenue for the Year  
Personal banking £m 2,998  
Business banking £m 3,078  
Other £m -398  
Total  £m 3,682.

Santander UK plc is a bank based in the United Kingdom (UK), wholly owned by the Spanish Santander Group - Scottish Highers Business Management - Question Question 1 - 2023

Worked Solution & Example Answer:Santander UK plc is a bank based in the United Kingdom (UK), wholly owned by the Spanish Santander Group - Scottish Highers Business Management - Question Question 1 - 2023

Extract of the business banking product portfolio for Santander UK plc.

Customer service ranking of UK banks in 2022.

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