Santander Receives Canadian Approval to Expand Consumer Banking

Spanish bank Banco Santander SA has secured approval from Canada’s government to expand its consumer banking business within the country. This follows its acquisition of auto financing company Carfinco in 2015 and the relaunch of Santander Consumer in 2021. The Office of the Superintendent will now review compliance and capital systems.

Spanish bank Banco Santander SA has received crucial approval from the Canadian government, potentially enabling the expansion of its consumer banking operations in the country, where it currently offers auto loans.

According to the Finance Department's June edition of the Canada Gazette, Santander Consumer Bank has been incorporated as a federally regulated financial institution, effective April 30. This pivotal development was first reported by Bloomberg News.

Santander entered the Canadian market in 2015 by acquiring auto financing company Carfinco and rebranded it as Santander Consumer in 2021. This move holds significant weight in Canada's tightly packed banking sector, dominated by six major banks and several other lenders specializing in everyday banking and short-term loans.

The Office of the Superintendent of Financial Institutions (OSFI), the primary banking regulator, will now begin a detailed review to ensure that Santander meets capital and compliance requirements. If all criteria are satisfied, OSFI will issue an order allowing the bank to conduct its business. This review process can take up to a year.

OSFI has stated it cannot comment on ongoing approvals processes, while Santander has also declined to comment on the matter.

(With inputs from agencies.)