SecProbe.io

Mail Stop 4561

September 26, 2006

By U.S. Mail and facsimile  to 011-34-91- 257-1282.

José Antonio Alvarez
Chief Financial Officer
Banco Santander Central Hispano, S.A.
Ciudad Grupo Santander
28660 Boadilla del Monte
Madrid, Spain

Re: Banco Santander Central Hispano, S.A.
Form 20-F for the Fiscal Year Ended December 31, 2005
 File No. 001-12518

Dear Mr. Alvarez:

We have reviewed your filing and have the following comments.  Where
indicated, we think you should re vise your document in response to these comments.  If
you disagree, we will consider your explanation as to why our comments are inapplicable
or a revision is unnecessary.  Please be as detailed as necessary in your explanation.  In
our comment, we may ask you to provide us with supplemental information so we may better understand your disclosure.  After review ing this information, we may or may not
raise additional comments.

 Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  We look forward to  working with you in these respects.  We
welcome any questions you may have about our comments or any other aspect of our review.  Feel free to call us at the telephone numbers listed at the end of this letter.

 Consolidated Financial Statements

Consolidated Income Statements, page F-3

1. We note that you have presented a lin e item entitled “Gross Income” on your
Consolidated Income Statement.  Please explain to us why you consider this

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 2
subtotal necessary to expl ain the elements of your financial performance.
Furthermore, please explain how the descri ption of this subtot al is appropriate
given that it is comprised of both income and expense items.

2. We note that you have classified your expenses by function on the face of your Consolidated Income Statement.  Wh ile paragraph 88 of IAS 1 permits the
classification of expenses by either na ture or function, paragraph 9 of IAS 30
requires banks to group their income and expenses by nature.  Please revise your
Consolidated Income Statement to properl y classify your expenses according to
their nature.

3. We note that you have presented a subtot al entitled “Net Operating Income” on
your Consolidated Income Statement.  Please tell us how you determined that it
was appropriate to exclude impairment losses and provisions from Net Operating Income, thereby implying that such expe nses are non-operating in nature.  Refer
to paragraph BC13 of IAS 1.

4. Please revise your income statement to present basic and diluted earnings per
share for all periods presented.  Refer to paragraph 66 of IAS 33.

Consolidated Statements of Changes in Equity, page F-4

5. It appears that your Consolidated Statements of Ch anges in Equity presents only
the changes in equity attributable to the items noted in paragraph 96 of IAS 1.
Under paragraph 96, such a presentation re quires this statem ent to be titled
“Statement of recognized income and expe nse.”  Please revise the title of this
statement accordingly or tell us why you be lieve the current title is appropriate.

Consolidated Cash Flow Statements, page F-5

6. We note that you present interest/dividends  paid as a financing activity.  Please
explain to us how the cla ssification of interest paid as a financing activity
impacted your net cash flows from operati ng activities.  For example, given that
your consolidated net profit for the year  includes amounts reported as interest
expense, we would expect to see an ad justment in the operating section of your
Cash Flow Statement to reflect the amount of  interest paid that has been classified
as a financing activity.

7. Please revise to separately present ca sh flows from interest and dividends
received and cash paid for income taxes.  Refer to paragraphs 31 and 35 of IAS 7.

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 3

Notes to the financial statements

Note 2 – Accounting policies and rules and measurement basis

d) Measurement of financial assets and liabilities and recogn ition of fair value
iii. Valuation techniques, page F-17

8. Please revise to provide all of the disc losures required by paragraphs 92-93 of
IAS 32 with respect to the methods used  to determine the fair value of your
financial instruments.

v.  Hedging transactions, page F-19

9. Please revise to disclose your accounting policy for the discontinuance of hedge
accounting.

g) Impairment of Financial Assets
ii. Debt instruments measured at amortised cost, page F-21

10. We note your disclosure beginning at the bottom of page F-21 regarding
impairment losses arising from credit risk.  We also note that you provide
enhanced disclosures of your methodology for determining these losses on page F-126 as part of your notes to your US GAAP reconciliation.  Given the
significant judgment involved in estima ting your allowance for credit losses we
believe that a more robust discussion of your estimation methodology should be
prominently disclosed in your financial st atement footnotes.  Accordingly, please
revise your footnote disclosure  regarding impairment of financial assets to fully
describe your methodology for determining your allowance for credit losses associated with debt instruments measur ed at amortised cost.  Such accounting
policy disclosure should provide sufficient de tail to enable a reader to understand
and evaluate each element of your allowance.

iii.  Debt or equity instruments classified as available for sale, page F-22

11. Please revise to clarify, if true, that  you do not reverse impairment losses
recognized on equity instruments.  Refer to paragraph 69 of IAS 39.

j) Reinsurance assets an d Liabilities under insuran ce contracts, page F-23

12. Please revise to clarify the method used to evaluate your reinsurance assets for
impairment and when you perform this eval uation.  Refer to paragraph 20 of IFRS
4.

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 4

v)  Post Employment Benefits, page F-30

13. We note that you utilize the corridor appr oach in recording actuarial gains and
losses, and that you divide by five and recognize in the income statement any
amounts exceeding 10% of either the plan obligations or plan assets, whichever
amount is higher.  Please revise to cl arify how you determined the period over
which actuarial gains and losses should  be recognized in accordance with
paragraph 93 of IAS 19.  For example, please explain whether the recognition of
actuarial gains and losses is based on the expected remaining working lives of the
employees participating in the plan or some other systematic method..  Additionally, please disclose why you belie ve 5 years to be an appropriate
estimate.

Note 11 – Hedging Derivatives, page F-57

14. Please revise to provide the disclosure s required by paragrap hs 58 and 59 of IAS
32 for each major hedging relationship.  Alternatively, please provide the
disclosures required by paragraphs 22-24 of IFRS 7.

Note 13 –  Investments – Associates, page F-58

15. Please revise to provide all of the disc losures required by paragraph 37 of IAS 28
with respect to your investments in associates.

Note 15 – Liabilities under insurance contracts and Rein surance assets, page F-60

16. Please revise to disclose the informati on required by paragraph 37 (c), (d) and (e)
of IFRS 4.

Note 16 – Tangible assets, page F-61

17. Please revise to disclose the information required by paragraphs 75(f)-(h) of IAS 40 with respect to your investment properties.

18. We note that you classify your tangible assets as either for your own use, investment property or other assets leased out under an operating lease.  It is not
clear to us why you differentiate proper ty leased out under an operating lease
from investment property.  Paragraph 8 of  IAS 40 provides a building leased out
under one or more operating leases as an example of investment property.  Please
revise to clarify whether you consider such  property to be investment property.  In
addition, please disclose the fair value of such property in accordance with paragraph 79(e) of IAS 40.

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 5

Note 17 –  Intangible assets, page F-62

19. Please revise to disclose the reasons supporting the indefinite life assigned to your brand name (Abbey) intangible asset.  Refer to paragraph 122(a) of IAS 38.

Note 25 – Provisions, page F-71

20. Please revise to provide all of the disc losures required by paragraph 120A of IAS
19 for each defined benefit plan .

21. Please revise to disclose whether you participate in any multi-employer pension plans.  If so, please revise to disclo se the information required by paragraph 29
and 120A of IAS 19.

Note 29 – Valuation adjustments, page F-79

22. You have provided a rollforward of the va luation adjustments related to the net
amount of unrealized change s in the fair value of av ailable-for-sale financial
assets at the top of page F-80.  Please clarify for us th e nature of the line item
entitled “Taxes transferred to income” and explain how you determined the
amounts to be reclassified into income for each year presented.

Note 49 – Personnel expenses

c)  Share based payments, page F-91

23. Please revise to disclose how you applie d the guidance in paragraphs 25B and
25C of IFRS 1 to your share- based payment transactions.

24. Your disclosure in note 49 on page F- 90 indicates that you did not record any
share-based compensation expense duri ng 2004.  The description of your stock
option and compensation plans on page 120 indicates that most of the options
granted under the plans were subject to  vesting provisions.  For example, it
appears that options issued  under your Investment Bank Plan vested over a 2-year
period where 50% vested on June 16, 2003 and 50% vested on June 16, 2004.
Please tell us how you considered the gui dance in paragraph 15 of IFRS 2 in
determining that no compensation expense should be recognized during 2004 as a
result of such vesting provisions.

25. Please revise to provide all of the disclosures required by paragraphs 44-52 of
IFRS 2 with respect to your share-base d payment transactions.  We note that you
have provided some of the information required by paragraph 45(a) of IFRS 2 on
page 120.  However, such disclosures must be provided within your financial

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 6
statements and explanatory notes in or der to fulfill the IFRS disclosure
requirements.

Note 54 – Geographical and Segment Reporting, page F-96

26. Please revise to disclose whether your ge ographic segments have been determined
based on the location of customers or the location of assets.  In addition, please
provide the disclosures required by paragr aph 71 or 72 of IAS 14, as applicable.

27. Please revise to present the following information for each reportable segment:

• Total assets held for sale at each re porting period as required by paragraph 41
(d) of IFRS 5;

• Net income attributable to continuing operations separately from discontinued
operations as required by paragraph 52 of IAS 14; and

• Total amount of expenditures made for asse ts expected to be used during more
than one period as required by paragraph 57 of IAS 14.

Note 57 –  Transition to International Financial Reporting Standards, page F-108

28. We note that you recorded adjustments to  your allowance for credit losses and
your provision for pensions at the date of  transition to IFRS. Please tell us how
you considered the guidance in paragra phs 31-33 of IFRS 1 in determining
whether such changes in estimates represented errors in previously issued financial statements.  In addition, please  revise to more cl early disclose the
differences between your current and fo rmer accounting policies that caused a
revision to such estimates.

29. We note that you recorded adjustments to your opening balance sheet at the date
of transition to IFRS relate d to derivative tran sactions.  Please re vise to clearly
disclose that hedging relationships designated under previous  GAAP that do not
qualify for hedge accounting under IAS 39 are not reflected in your opening IFRS balance sheet.  Refer to paragraphs 29-30 of IFRS 1.

Note 58.3 – Net Income and Stockholder’s Equi ty reconciliations between IFRS and U.S.
GAAP

30. We note that your reconciliations of net income and stockholders’ equity between
IFRS and US GAAP do not contain a reconc iling item related to pensions.  Please
explain to us how you considered th e guidance in IAS 19 and SFAS 87 in

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 7
determining whether there were any differences in your accounting for pensions under IFRS as compared to US GAAP.

Notes to the Net Income and to  the Stockholders’ Reconciliation

31. Please note that the reconcil iations of net income and shareholders’ equity should
be in sufficient detail to allow an investor  to determine the differences between an
income statement and balance sheet pr epared using IFRS (or prior GAAP) and
those prepared using US GAAP.  With this  in mind please revise the explanatory
notes accompanying your reconciliations to:

• Clearly identify the primary differences contributing to each reconciling item,

• Quantify individual components to the exte nt that various fa ctors contributed
to the reconciling item, and

• Clearly describe the relevant accoun ting policies under both IFRS and US
GAAP, highlight the major differences, and specifically explain how such
differences resulted in a reconciling item.

a)  Allowances for credit losses, page F-126

32. We note your disclosure that reconcili ng items exist between IFRS and US GAAP
with respect to your allowance for credit losses related to the determination of
allowance losses not allocated to specif ic loans.  Please provide us with:

• a detailed description of your gr oup methodology for the estimation of
incurred but not identified loan losses under IFRS;

• a detailed description of  your methodology for calculating a general loan loss
reserve under US GAAP on a group-wide basis;

• explanation as to what you mean when  you state that the loan loss allowance
under US GAAP should represent the best  estimate of proba ble losses in
“possible scenarios”;

• an enhanced discussion of the statistical  percentages obtained from historical
trends as determined by the Bank of Sp ain guidance and an explanation as to
why these statistical pe rcentages would be cons idered in your methodology
under IFRS but not under US GAAP; and

• the specific US GAAP and IFRS guidance relied upon to support your
conclusion that differences in applica tion and estimation of the allowance for
loan losses exist.

José Antonio Alvarez
Banco Santander Central Hispano, S.A.
September 26, 2006 Page 8

b)  Investment securities, page F-127

33. Please revise to more clearly explain the adjustment presented to reconcile
amounts related to investment securitie s under IFRS to amounts reported under
US GAAP. Specifically address the fo llowing in your revised disclosures:

• Clarify exactly how your equity investme nts of more than 3% and less than
20% are classified (i.e. trading, availa ble-for-sale or held-to-maturity) and
accounted for (i.e. cost, fair value or lower of cost or market) under SFAS
115;

• Clarify how such investments are cl assified and accounted for under IFRS;

• Explain how your prior accounting fo r these investments under Spanish
GAAP would have an impact on the amounts recorded under IFRS that would result in a reconciling item to US GAA P.  We note that paragraph 104 of IAS
39 requires the standard to be applied retr ospectively.  Therefore it is not clear
to us why the ca