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March 12, 2012

Ms. Suzanne Hayes

Assistant Director

Division of Corporation Finance

U.S. Securities and Exchange Commission

100 F Street, N.E.; mail stop 4561

Washington, D.C. 20549

U.S.A.

Re: Banco Santander, S.A.

Form 20-F for Fiscal Year Ended December 31, 2010

Filed June 6, 2011

Form 6-K Furnished October 31, 2011

Form 6-K Furnished January 31, 2012

Form 6-K Furnished February 7, 2012

File No. 001-12518

Dear Ms. Hayes:

On behalf of Banco Santander, S.A. (“Santander” or the “Bank”), I hereby submit Santander’s responses to the comments of the staff of the Division of Corporation Finance (the “Staff”) of the United States Securities and Exchange Commission (the “Commission”) set forth in your letter dated February 10, 2012 in connection with the above referenced Annual Report on Form 20-F (the “20-F”) and Form 6-Ks of Santander.

I set forth below our responses to each of the Staff’s comments, indicating each comment in boldface text with our response below.  All references to page numbers in Santander’s responses are to pages in the filed version of the 20-F and 6-Ks. I have also underlined and italicized our proposed changes to our Form 20-F and to our consolidated financial statements that will be included in future filings and I have struck through the text that will be deleted in future filings.

****************************

Form 20-F for Fiscal Year Ended December 31, 2010

Risk Factors, page 13

Credit, market and liquidity risks may have an adverse effect on our credit ratings…, page 20

1. We note your response to prior comment four and reissue the comment in part. Please expand your risk factor to quantify, absent other changes, the effect that a one- and two-notch downgrade would have on your collateral obligations under your derivative contracts. If you believe that you are unable to quantify what those collateral obligations would be, please expand your disclosure in this risk factor to explain in detail why you are unable to quantify such obligations.

We have sought to address the Staff's comment and indicate below our proposed disclosure. In future filings we will add further disclosure on the effect on our derivatives contracts of recent downgrades, including quantification of the effect on our collateral obligations under those contracts. In addition, our proposed disclosure provides a qualitative explanation of the impact of future downgrades.  As the Group conducts substantially all of its material derivative activities through Banco Santander S.A. and Santander UK, our disclosure is focused on those entities. We explain in detail the impact of further downgrades of Banco Santander S.A. and Santander UK's credit ratings which cannot be reliably quantified because, as described in further detail in our proposed disclosure, the impact of any downgrade would largely depend on the response of Banco Santander, Santander UK and the counterparties to such derivative contracts and could involve any combination of posting additional collateral, providing guarantees, closing out positions, renegotiating terms and assignment of contracts.

1

“Credit, market and liquidity risks may have an adverse effect on our credit ratings and our cost of funds. Any reduction in our credit rating would likely increase our cost of funding, require us to post additional collateral or take other actions under some of our derivative contracts and adversely affect our interest margins and results of operations.

Credit ratings affect the cost and other terms upon which we are able to obtain funding.  Rating agencies regularly evaluate us and their ratings of our long-term debt are based on a number of factors, including our financial strength as well as conditions affecting the financial services industry generally.

Any downgrade in our ratings would likely increase our borrowing costs, and require us to post additional collateral or take other actions under some of our derivative contracts, and could limit our access to capital markets and adversely affect our commercial business. For example, a ratings downgrade could adversely affect our ability to sell or market certain of our products, such as subordinated securities, engage in certain longer-term and derivatives transactions and retain our customers, particularly customers who need a minimum rating threshold in order to invest. This, in turn, could reduce our liquidity and have an adverse effect on our operating results and financial condition. Under the terms of certain of our derivative contracts, we may be required to maintain a minimum credit rating or terminate such contracts.

Banco Santander S.A.’s long-term debt is currently rated investment grade by the major rating agencies Aa3 by Moody’s Investors Service España, S.A., A+ by Standard & Poor’s Ratings Services and A by Fitch Ratings Ltd. all of which have a negative outlook due to the difficult economic environment in Spain. All three agencies downgraded Banco Santander S.A.’s rating in October 2011 and February 2012 together with that of the other main Spanish banks, due to the tougher-than-previously-anticipated macroeconomic and financial environment in Spain with dimming growth prospects in the near term, depressed real estate market activity and heightened turbulence in the capital markets. Santander UK’s long-term debt is currently rated investment grade by the major rating agencies A1 with outlook under review by Moody’s Investors Service, A+ with negative outlook by Standard & Poor’s Ratings Services and A+ with stable outlook by Fitch Ratings. Standard & Poor’s Ratings Services downgraded Santander UK’s rating in February 2012 from AA- to A+ with negative outlook, following their downgrading of Banco Santander S.A. because the rating for both entities is equalised under Standard & Poor’s rating criteria of ‘core subsidiaries’ .

The Group conducts substantially all of its material derivative activities through Banco Santander S.A. and Santander UK. Following the credit rating downgrades described above, Banco Santander S.A. posted a total of approximately €250 million of additional collateral pursuant to derivative and other financial contracts while the impact on Santander UK was not significant. Under the terms of certain derivative and other financial contracts, in the event of a further downgrade of Banco Santander S.A.’s or a downgrade of Santander UK’s long-term debt rating, counterparties to those agreements may require Banco Santander S.A. or Santander UK, as appropriate, to provide additional collateral, terminate these contracts or provide other remedies.

If the rating agencies were to downgrade their long-term senior debt ratings for Banco Santander S.A. by one or two incremental notches, we expect that the amount of additional collateral we would post would likely be line with the collateral posted in response to Banco Santander S.A.’s most recent downgrades. An additional downgrade of Santander UK’s long-term senior debt ratings would lower Santander UK’s credit ratings below the minimum allowed by certain of its derivative and other financial contracts and could require that such counterparty contracts be renegotiated. The impact of any such downgrade cannot be accurately predicted as the impact would largely depend on the response of Santander UK, the Group and the respective counterparties. For example, as a result of the renegotiations, Santander UK could be required to cancel derivative contracts, post additional collateral, sell its position to another party that holds the required minimum credit ratings and/or provide a guarantee from an entity that holds the required minimum credit ratings, among others. It is not possible to know in advance what actions Santander UK, the Group and the respective counterparties would undertake in the event of a further downgrade of Santander UK’s credit ratings. We expect that any such downgrade would have a material adverse effect on the Group’s financial condition and results of operations, significantly larger than the impact of the downgrades of Banco Santander S.A.’s credit ratings in October 2011and February 2012 and of Santander UK in February 2012.  In addition, if due to future downgrades, Banco Santander S.A. or Santander UK were required to cancel their derivative contracts with certain counterparties and were unable to replace such contracts, the Group’s market risk profile could be altered.

2

While certain potential impacts are contractual and quantifiable, the full consequences of a credit ratings downgrade to a financial institution are inherently uncertain, as they depend upon numerous dynamic, complex and inter-related factors and assumptions, including market conditions at the time of any downgrade, whether any downgrade of a firm’s long-term credit ratings precipitates downgrades to its short-term credit ratings, and assumptions about the potential behaviors of various customers, investors and counterparties. For a further discussion of our liquidity matters, see “Operating and Financial Review and Prospects — Funding and capital resources.”

In light of the difficulties in the financial services industry and the financial markets, there can be no assurance that the rating agencies will maintain their current ratings or outlooks, or with regard to those rating agencies that have a negative outlook on the Group, there can be no assurances that such agencies will revise such outlooks upward. The Group’s failure to maintain favorable ratings and outlooks would likely increase its cost of funding and adversely affect the Group’s interest margins and results of operations.

Exposure to sovereign counterparties by credit rating, page 58

2. Refer to your response to prior comment six. Please revise your proposed disclosure in future filings to quantify and clarify which columns include the following:

·

derivative exposure, other than CDS contracts already included in your proposed disclosure;

·

repurchase agreement exposure;

·

off-balance sheet exposure; and

·

collateral netted against amounts disclosed.

We acknowledge the Staff’s comment and we present below the revised proposed disclosure to be included in our future fillings with figures as at December 31, 2011:

“The detail of Santander Group's total risk exposure (excluding the value of any collateral associated with the corresponding balances) to the peripheral countries of the euro zone at 31 December 2011, based on the country of the issuer or borrower in terms of sovereign risk and private sector exposure, is as follows:”

3

Sovereign risk by country of issuer/borrower (**)

Millions of euros

Debt instruments

Loans and advances to customers  (*)

Derivatives

Total on-balance-sheet exposure

Contingent liabilities and commitments (off-balance exposure)

Total exposure

Balances with central banks

Financial assets held for trading and Other financial assets at fair value through profit or loss

Available-for-sale financial assets

Loans and receivables

Direct exposure

Indirect exposure (CDSs)

Spain

4,841

8,060

29,975

1,274

12,147

225

-

56,522

2,848

59,370

Portugal

1,359

83

1,741

-

847

846

-

4,876

272

5,148

Italy

9

406

247

-

-

15

(15)

662

-

662

Greece

-

-

84

-

-

-

-

84

-

84

Ireland

-

-

-

-

-

139

-

139

-

139

(*) Presented excluding valuation adjustments and impairment losses recognised.

(**) Repurchase agreement exposure is disclosed in “Balances with central banks”, “Loans and advances to credit institutions“ and in “Loans and advances to customers”.

Private sector exposure by country of issuer/borrower (**)

Millions of euros

Debt instruments

Derivatives

Contingent liabilities and commitments (off-balance exposure)

Loans and advances to credit institutions

Financial assets held for trading and Other financial assets at fair value through profit or loss

Available-for-sale financial assets

Loans and receivables

Loans and advances to customers (*)

Direct exposure

Indirect exposure (CDSs)

Total on-balance-sheet exposure

Total exposure

Spain

5,547

2,069

5,385

955

202,411

3,226

(46)

219,547

63,025

282,572

Portugal

-

862

907

1,935

23,337

468

(8)

27,501

7,706

35,207

Italy

-

359

88

98

11,705

(308)

(4)

11,938

3,402

15,340

Greece

-

-

-

-

170

64

-

234

138

372

Ireland

-

211

281

150

491

286

-

1,419

110

1,529

(*) Presented excluding valuation adjustments and impairment losses recognised.

(**)Repurchase agreement exposure is disclosed in “Loans and advances to credit institutions“ and “Loans and advances to customers”.

4

The following information presents the notional amount of the CDSs at 31 December 2011 detailed in the foregoing tables:

Millions of euros

Notional amount

Fair value

Bought

Sold

Net

Bought

Sold

Net

Spain

Sovereign

-

-

-

-

-

-

Private

3,288

4,122

(834)

96

(142)

(46)

Portugal

Sovereign

211

211

-

60

(60)

-

Private

409

448

(39)

93

(101)

(8)

Italy

Sovereign

429

614

(185)

46

(61)

(15)

Private

1,106

1,129

(23)

114

(118)

(4)

Greece

Sovereign

223

223

-

158

(158)

-

Private

54

44

10

9

(9)

-

Ireland

Sovereign

9

9

-

1

(1)

-

Private

60

60

-

5

(5)

-

In order to respond to your specific points:

·

Derivative exposure, other than CDS, is now included in the column “Derivatives – Direct exposure” of the tables above;

·

Repurchase agreement exposure is disclosed in the “Balances with central banks”, “Loans and advances to credit institutions“ and “Loans and advances to customers” columns.

·

Our off-balance sheet exposure was already presented in our letter dated October 28th, 2011; however we have also clarified this aspect in the tables above in order to enhance clarity.

·

We present the information excluding any collateral netted against the amount disclosed.

5

Item 5. Operating and Financial Review and Prospects, page 94

Results of Operations for Santander, page 103

Income Tax, page 112

3. Refer to your response to prior comment 11. Please address the following:

·

We note that your statutory tax rate disclosed in Note 27 is 30 percent. Please revise your disclosure in future filings to clarify whether this tax rate is based solely on your statutory rate in Spain. If so, given your explanation that the mix of income generated in foreign countries with higher tax rates was the cause of your effective income tax rate increase in 2010, please tell us how you determined that this presentation provided the most meaningful information to financial statement readers. Refer to paragraph 85 of IAS 12.

·

We also note that your response indicates the reason for the higher effective rate in 2010 is due to a higher proportion of income being derived from your businesses in Latin America, the United Kingdom, and the US, which have higher tax rates than Spain. However, the effect of different tax rates disclosed in Note 27 is a net decrease from the statutory tax rate of 30 percent, which seems to indicate you are deriving income from foreign jurisdictions with lower tax rates than Spain. Please reconcile this apparent inconsistency.

·

Expand your disclosure to separately disclose the effect of the income tax rates of foreign jurisdictions so that a reader may understand the significant factors that affect your income tax expense. Clearly disclose the basis of these adjustments (i.e., whether they are the statutory tax rates or the effective tax rates) in each of the countries for which you incur a material amount of tax expense. Refer to paragraph 84 of IAS 12.

·

Also, please clarify in your proposed disclosure how your effective tax rate remains below the statutory rate of Spain, especially when you derive a higher proportion of income from foreign jurisdictions with an even higher statutory tax rate than Spain. Please expand your disclosure to separately describe the nature of material pe