SecProbe.io

September 29, 2010

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

José Antonio Alvarez Chief Financial Officer Banco Santander, S.A. Ciudad Grupo Santander 28660 Boadilla del Monte Madrid, Spain
Re: Banco Santander, S.A.
Form 20-F for the Fiscal Year Ended December 31, 2009
 File No. 001-12518

Dear Mr. Alvarez:
 We have reviewed your filing and have the following comments.  In some of our
comments, we may ask you to provide us with  information so we may better understand your
disclosure.
 Please respond to this letter within te n business days by providing the requested
information, including a draft of your proposed disclosures to be made in future filings, or by
advising us when you will provide the requested  response.  If you do not believe our comments
apply to your facts and circumstances or do not believe future revisions are appropriate, please
tell us why in your response.
 After reviewing the information you provide in response to these comments, including
the draft of your proposed disclosures, we may have additional comments.
             Form 20-F for the fiscal year ended December 31, 2009

 General

1. We note your disclosure on pages 24 and 26 th at in October 2007, RFS Holdings B.V., a
company owned partially by you, acquired ABN AMRO Holding N.V., which was renamed The Royal Bank of Scotland Holdi ng N.V. in April 2010.  We are aware of a
U.S. Department of Justice press releas e dated May 10, 2010, reporting that the former
ABN AMRO Bank N.V. agreed to forfeit $500 million to the United States in connection
with violations of law that i nvolved illegal U.S. dollar transa ctions on behalf of financial

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 2

institutions and customers from Iran, Libya, Sudan, Cuba, and other countries sanctioned
in programs administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), including a limited nu mber of transactions that occurred in
2007.  Please tell us, to the best of your know ledge, whether the transactions covered by
this agreement include transactions that occurred after ABN AMRO Holding N.V. was
acquired by RFS Holdings B.V.  Describe to us in reasonabl e detail the nature of any
such transactions, the count ries involved, and the aggr egate dollar value of the
transactions related to each country.

2. We note the disclosure on page 166 and else where that you operate in Latin America and
Asia, regions that can be understood to in clude Cuba, Iran, and Syria.  As you know,
Cuba, Iran, and Syria are identified by the U.S.  Department of State as state sponsors of
terrorism, and are subject to U.S. economic sanc tions and export controls.  Please provide
us with information regarding your contacts w ith those countries si nce your letter to us
dated April 27, 2007.  Your response should a ddress both direct c ontacts and contacts
through subsidiaries, affiliates, or other indirect  means.  It should describe any services or
funds you have provided to indi viduals and institutions of those countries, directly or
indirectly, since your letter, and any agreem ents, commercial arrangements, or other
contacts you have had with the governments of  those countries or en tities controlled by
those governments since that time.   Finally, discuss the applicability of Section 104 of the
Comprehensive Iran Sanctions, Accountabi lity, and Divestment Act of 2010 to any
activities related to Iran.

3. Please discuss the materiality of any contacts  with Cuba, Iran, Sudan, and Syria that you
describe in response to the fo regoing comments, and whether those contacts constitute a
material investment risk for your security holders.  You should address materiality in
quantitative terms, including the approxima te dollar amounts of revenues, assets, and
liabilities associated with each of Cuba, Ira n, Sudan, and Syria for the last three fiscal
years and the subsequent interim period.  Als o, address materiality in terms of qualitative
factors that a reasonable i nvestor would deem important in making an investment
decision, including the potential impact of corporate activities upon a company’s
reputation and share value.  As you know, va rious state and municipal governments,
universities, and other inve stors have proposed or adopted divestment or similar
initiatives regarding investment in companie s that do business with U.S.-designated state
sponsors of terrorism.  Your materiality anal ysis should address the potential impact of
the investor sentiment evidenced by such acti ons directed toward companies that have
operations associated with Cuba, Iran, Sudan, and Syria.
 Item 3. Key Information

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 3

A. Selected financial data, page 6

4. We note your disclosure of certain Credit Qual ity Data information and ratios on pages 8
and 9.  In order to promote greater clarity a nd transparency, specifically related to your
loans and lending credit quality, pl ease revise future filings to present the ratio of your
allowances for impaired balances, inclusiv e of country risk but exclusive of the
allowance for contingent liabilit ies, as a percentage of only gr oss loans.  We believe this
would present a more accurate reflection of th e coverage of your allowance related only
to loan losses to total gross lo ans.  To the extent you choos e to continue to present your
other ratios, such as those where the denomin ator includes contingent  liabilities, please
revise to more clearly disclo se their usefulness and limitatio ns in evaluating the credit
quality of your loan portfolio.
 Item 4. Information on the Company

 Recent Events – Downgrade of Greek and Spanish Sovereign Debt Ratings, page 30

5. We note your disclosure related to the recent downgrades of Greek, Spanish and
Portuguese debt ratings and the European Ce ntral Bank’s recent actions to off-set the
negative impacts from the debt ratings downgr ades.  Given these market concerns, and
your significant exposure to sovereign count erparties, please tell us and enhance your
disclosure in future filings to provide fu rther quantitative exposure, by country, to any
country whose credit rating is AA or below.  Further, in light of your exposure to Spain,
please revise this section to quantify your exposure to Spanish sovereign debt.  As part of
your response, please identify th e financial statement line item in which these exposures
are included.
 Non-Accrual of Interest Requirements, page 57

6. Please revise your future filings  to address the following:
a. Clarify whether you have ceased the accrual of interest income on loans classified as
non-accrual and explain the difference betw een a loan classified as non-accrual
versus impaired.  If you have ceased the accru al of interest income, please tell us how
you apply the guidance in paragraph AG 93 of IAS 39.
b. If you continue to accrue inte rest pursuant to paragraph AG93 on loans classified as
“nonaccrual”, please revise your future filings to more accurately label these loans.
Please revise future filings to clarify wh ether you recognize as interest income the
accretion of the net present value of the wr itten down amount of the loan due to the
passage of time based on the original e ffective interest rate of the loan.
c. More thoroughly discuss specifically how  your non-accrual policy affects other
aspects of your loan portfolio, such as pa st due and nonaccrual loans, as well as other
aspects of your credit quality such as char ge-offs, the provision, and the allowance for
loan losses.

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 4

 Bank of Spain Charge-off Requirements, page 61

7. Please address the following regarding your di sclosure here: “Otherwise, the Bank of
Spain requires Spanish banks to charge-off non-performing assets four years after they
were classified as non-performing. Spanish banks may carry fully secured past-due
mortgage loans beyond this four-year deadline  for up to six years if there ar e objective
factors that indicate an impr oved likelihood of recovery.”
a. Tell us how this relates to your following disclosure on page 89, “According to Bank
of Spain’s requirements, non-performing loans must be wholly provisioned (hence all
the credit loss recognized) when they are mo re than 24 months overdue, or after more
than 6 years for secured mortgage loans.”
b. Further, tell us what you mean by “wholly provisioned” and why an impaired loan
would not need to be wholly provisioned to recognize the full amount of credit loss
on the loan at the time it was init ially deemed to be impaired.
c. In light of the fairly long-t erm triggers such as two to six years as referenced above
and in order to provide transparency into  the length of delinquencies within your
portfolio, please tell us and revise your future  filings to provide an aging of your past
due loans by category that quantifies by seri es of buckets to u nderstand the length of
time loans have been past due.  Please provi de sufficient granularity in your buckets
to allow the reader to understand the progression of loans over time.  Provide
narrative disclosure addressing any delinquency trends reflected.

Movements in Allowance for Credit Losses, page 62

8. Please revise future filings to present the ratio of net charge offs against credit loss
allowance to average loans outstanding for a ll periods, as required by Item IV.A of
Industry Guide 3.

9. Please tell us and revise your future filings to  more clearly identify th e factors that led to
the significant increase in charge-offs in 2009 compared to 2008.  In particular, please
clearly address the increase in charge-offs in  commercial loans outside of Spain.  Identify
and discuss the trends you experienced and your  expectations for how and the extent to
which these identified trends will continue to  affect you in terms of future impairment
losses charged to the income statement and future charge-offs.

10. Please address the following regarding the line item titled “Inclusion of acquired
companies’ credit loss allowances” in your ro llforward of the Allowance for credit losses
on page 62.  The same amounts appear to be ti tled “Inclusion of entities in the group in
the year” in your rollforward on page F-86. a. Tell us and revise your future filings to more clearly describe  the nature of the
amounts presented in this line item.

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 5

b. To the extent that this line item represents  allowances related to loans acquired in
business combinations, please tell us how you considered the guidance of paragraph
B41 of IFRS 3.
c. Revise your credit quality di sclosures to more clearly id entify, discuss, and quantify
the impact of your accounting treatment of loans acquired in business combinations
on your allowance, impairment losses charge d to income statement, charge-offs, and
related ratios.  If true, discuss the fact th at since no allowance is recognized on these
loans at the acquisition date, your allowance,  impairment losses charged to income
statement, charge-offs, and related ratios will  be affected and may not be comparable
to prior periods or to your competitors.
 Other Non-Accruing Balances, page 67

11. We note your reference to restructured loans.  Please revise your future filings to address
the following: a. Discuss how you identify loans to be restructured;
b. Quantify the amount of restructured loans (by loan type), and separately disclose the
amounts in accrual and nonaccrual status;
c. Quantify the types of concessions you have  made (e.g. reduction of interest rate,
payment extensions, forgiveness of prin cipal, forbearance or other actions) and
discuss your success with the different t ypes of concessions (qualitatively and
quantitatively);
d. Disclose your policy regarding how many payments the borrower needs to make on
the restructured loans before you retu rn the loan to accrual status; and
e. Discuss how restructured loans impact the timing of the recording of the provisions
for impairment losses.  For example, discu ss whether the largest effect of the loan
modification is recorded during the peri od of the modification or whether the
modification has largely been reserved  for under your normal reserving methodology
prior to the modification.
 Item 5. Operating and Financial Review

 G. Other Disclosures – Higher-Risk Loans, page 126

12. We note your reference to an “affordability rate” here and on page 219.  Please revise
future filings to include a description of this  measure and to discuss in detail how this
measure relates to your lending policies and procedures.
  Item 18. Financial Statements

 Note 2. Accounting Policies and Measurement Bases

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 6

b(v). Basis of consolidati on – Other matters, page F-23

13. We note your disclosure related to “compa nies less than 50% owned by the Group that
constituted a decision-making unit at Decem ber 31, 2009 and which, therefore, were
accounted for as subsidiaries.”  Please tell us and revise future filings to disclose more
information related to these entities as well as your basis under the accounting literature
for consolidation.  In your response and disclosures, plea se specifically address the
purpose of the various entities and descri be the meaning and purpose of your term
“decision-making unit.”
 j. Reinsurance assets an d liabilities under insurance contracts, page F-39

14. Please tell us and revise future filings to disclose the type(s) of insurance offered (e.g.
health, life, etc.) and a description of each t ype(s) offered.  To the extent your accounting
policies vary by type of insurance unde rwritten, please expand to clarify.
 Note 7. Debt Instruments, page F-79

15. We note that approximately 46% and 60% of your  total debt instruments portfolio relates
to securities either issued by fi nancial institutions or other fi xed-income securities.  In an
effort to provide greater transparency and gr anularity in your disclo sure, please consider
disaggregating these categories further into addi tional classes of financial instruments.  In
addition, please consider disc losing the underlying securities ’ credit ratings or issuer
financial condition.  Please provide us w ith your proposed revised future filings
disclosures.

16. We were unable to locate disclosure of the total gross unrealized gains and/or losses for
either your available-for-sale debt instru ments or your available-for-sale equity
instruments, which are disclosed in Note 8 beginning on page F-80.  In the interest of
transparency and consistent w ith the guidance in paragraph 31  of IFRS 7, please revise
your future filings to provide disclosures that will enable a reader to more clearly assess
the extent of your impairment risk expos ure on your available-for-sale investment
portfolio.  For example, consider revising your  disclosure to separately present gross
unrealized losses and gross unrea lized gains on investment secu rities.  Please tell us and,
in order to provide greater transparency to the reader, also consider disclosing the gross
unrealized losses by duration (e.g. less than 12 months and greater than 12 months)
and/or by security type.
               We urge all persons who are res ponsible for the accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are

 José Antonio Alvarez Banco Santander, S.A. September 29, 2010 Page 7

in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.                In responding to our comments, please provide a written statement from the company
acknowledging that: