Santander's Record Bonuses for Executives: What Portugal's Bank Staff and Customers Need to Know

Banco Santander distributed over €1M in compensation to 458 senior staff during the 2025 financial year—a 44% jump from the 318 executives who crossed the million-euro threshold in 2024—according to the bank's Prudential Relevance Report reviewed by Europa Press. The spike reflects a record-breaking profit of €14.1B (+12% year-on-year) and a 126% surge in share price, directly feeding the bonuses of top-tier managers and investment bankers.

Why This Matters

• Deferred compensation risk: A significant portion of these payouts is tied to long-term objectives that won't vest until 2029–2031, meaning actual cash delivery depends on future performance.

• Geographic concentration: 38% of million-euro earners are based in the United States, where variable pay has no regulatory cap—a stark contrast to European Union rules.

• Transparency mandate: European Central Bank and ESMA regulations require at least 40% of variable pay to be deferred, pushing Santander to disclose granular breakdowns of executive rewards.

• Local context: While Banco Santander Totta in Portugal follows similar deferral rules, the bulk of high-value bonuses flow to Corporate and Investment Banking units outside the Iberian Peninsula.

Who Got Paid—and How Much

Nearly half of the 458 executives—224 individuals—received between €1M and €1.5M, while 96 collected between €1.5M and €2M. Another 112 staff members secured payouts ranging from €2M to €5M, underscoring the bank's aggressive reward structure for middle-tier risk-takers.

At the upper end, 23 people earned €5M to €10M, two pocketed between €11M and €13M, and a single executive—likely CEO Héctor Grisi or Chair Ana Botín—received between €15M and €16M. Botín's total 2025 package was confirmed at €18.54M (up 34.6% from 2024), comprising €8.3M in shares, a €4.3M cash bonus, €2.5M in other benefits, and a €3.4M fixed salary. Grisi's remuneration rose to €11.43M, a 6.3% increase.

These figures include deferred variable pay calculated at fair value and linked to multi-year performance targets. Under Santander's structure, portions of the 2025 bonus will be paid in tranches through 2029, 2030, and—for some recipients—2031, contingent on sustained financial metrics such as CET1 capital generation, revenue per active customer, and cost control.

Where the Money Went

The geographic breakdown reveals a stark divide in compensation philosophy. The United States accounted for 38% of million-euro earners, followed by the United Kingdom at 15%. Santander attributed this to "more competitive remuneration," a "more flexible labor market," and the absence of EU-style caps on variable pay.

A substantial share of high earners—both in the US and UK and across other markets—work in Corporate and Investment Banking (CIB), which posted a record attributable profit of €2.8B (+7%) in 2024, driven by a 5% revenue increase and robust net interest margins in Global Markets. The CIB unit alone justified much of the bonus pool expansion, as banks traditionally reward deal-makers and traders with a higher share of revenue.

Regulatory Scaffolding: How Brussels and Frankfurt Shape Payouts

European supervisors have tightened oversight of bank bonuses since the 2008 financial crisis, and Santander's 2025 disclosures reflect that pressure. Under ECB and ESMA rules, at least 40% of variable pay for identified staff—those whose roles carry material risk or control functions—must be deferred. For executives at the highest level, that percentage rises further.

Santander's remuneration policy for 2025 also embeds malus and clawback clauses, allowing the bank to withhold or reclaim bonuses if performance targets fail or misconduct surfaces. For instance, if a senior banker's book generates losses in subsequent years, unvested tranches can be canceled.

In December 2024, Santander announced a significant policy shift for Portugal and other European markets: bank tellers will no longer be eligible for general variable pay, receiving only the Programa Próprio de Resultados (PPRS)—an internal performance-sharing scheme. Variable compensation will henceforth be restricted to commercial areas, a move that labor representatives view as a potential devaluation of frontline roles.

The "Identified Staff" Universe

At year-end 2024, Santander classified 1,336 employees as identified staff—an increase of 93 from the prior year—encompassing not just board members and senior management but also traders, risk officers, compliance heads, and anyone whose pay or responsibilities match executive thresholds. Together, this group received €1.27B in total remuneration, averaging just under €1M per person.

The identified-staff designation triggers heightened disclosure and deferral obligations. It also means that bonuses for compliance, audit, and risk managers are decoupled from commercial results in the business units they oversee, aligning with EU principles that control functions must remain independent.

What Drives the Bonus: The Scorecard Mechanics

For 2025, Santander's executive variable pay hinged on a balanced scorecard weighted as follows:

• Transformation (45%): Total client growth (10%), active-client growth (10%), revenue per active client (10%), and cost discipline (15%).

• Capital generation (30%): Measured via the CET1 ratio, a key regulatory capital metric.

• Individual and team objectives (25%): Function-specific KPIs, including risk management, ESG targets, and conduct standards.

This framework ensures that bonuses reward not only short-term profit but also long-term strategic health. For investment professionals at Santander Asset Management UK, individual scorecards further incorporate investment performance, regulatory compliance, and adherence to the firm's behavioral principles.

Impact on Portugal-Based Staff and Shareholders

For employees at Banco Santander Totta, the Portuguese operating unit, the 2025 remuneration policy stipulates that fixed pay must represent at least 33% of total compensation. Variable pay is split 50% in cash and 50% in financial instruments, with half paid in 2026 and the remainder deferred over five years.

The restriction of variable pay to commercial roles—announced in December 2024—means that tellers and back-office staff in Portugal will see a narrower path to bonuses. This structural change affects a significant portion of the Portuguese workforce at Banco Santander Totta, where tellers and support roles represent a substantial share of employment. Such a policy shift could affect morale and turnover in a labor market already constrained by demographic headwinds, particularly in smaller towns and rural areas where branch retention is critical.

Portuguese banking unions, including representatives from the larger sector organizations, have flagged concerns about the teller eligibility changes, raising potential discrimination concerns under Portuguese Law 45/2018, which mandates equal access to employment benefits regardless of role classification. As of early 2026, formal union responses continue to take shape, though the initial reaction has centered on whether the policy violates principles of equal treatment.

In the broader Portuguese banking sector, comparable changes have emerged at other major operators. Caixa Geral de Depósitos (CGD) and Banco Comercial Português (BCP) maintain more inclusive variable-pay eligibility for retail branches, though both have implemented tighter performance thresholds in recent years. Novo Banco, by contrast, has adopted similar commercial-focused restrictions to Santander's approach. The divergence suggests that Santander's move, while significant, reflects a strategic choice rather than an industry-wide mandate—making it particularly relevant for Portuguese employees evaluating employment prospects.

Meanwhile, shareholders benefit from the deferral model, which ties executive wealth to the stock price: if shares underperform, unvested tranches lose value. For Portuguese pension funds and retail investors holding Santander equity, the multi-year vesting schedule creates both upside potential and alignment incentives.

Broader Context: Turnover, Severance, and Golden Hellos

Santander emphasized that the year-on-year increase in million-euro earners also reflects staff turnover effects. The reported figures include severance payments, non-compete indemnities, and sign-on bonuses for new hires—particularly in competitive markets like New York and London, where poaching senior bankers demands upfront cash or guaranteed compensation.

By March 2026, Santander disclosed it had paid €15M to Webster Bank CEO John Ciulla for a one-year stint leading a merger integration—just under Botín's 2025 package and illustrative of the premium the bank places on deal execution.

How Santander Stacks Up Against European Peers

Precise comparisons with other European banks for 2025 are not yet available, as annual reports typically publish in the first half of the following year. However, Santander's compensation philosophy—heavily weighted toward deferred equity and long-term metrics—mirrors practices at peers such as HSBC, BNP Paribas, and Deutsche Bank.

European lenders face stricter bonus caps than their US counterparts, but large international banks have carved out workarounds by concentrating high earners in New York and London subsidiaries, where local rules permit higher variable-to-fixed ratios. Santander's 38% US concentration is consistent with this strategy.

What This Means for Residents

For Portuguese taxpayers and Santander Totta customers, the headline numbers may seem distant, but the underlying mechanics matter. The bank's profitability—fueled by net interest margin expansion as European Central Bank rates remained elevated through mid-2025—translates into higher dividends for shareholders, many of whom are Portuguese pension funds and retail investors.

At the same time, the shift away from teller bonuses and the emphasis on commercial-area incentives could reshape service quality and staff retention at brick-and-mortar branches, especially in smaller towns where digital transformation lags. If frontline employees perceive a growing pay gap with investment bankers, recruitment and training costs may rise, potentially affecting branch staffing levels and opening hours in less densely populated regions.

For Portugal-based executives and risk managers within the identified-staff cohort, the deferral structure offers both opportunity and constraint: upside is tied to multi-year stock performance, but downside risk includes malus provisions and clawback exposure if the bank's capital ratios or conduct standards falter.

Looking Ahead: 2026 and Beyond

Santander's 2025 bonus cycle sets a high bar for 2026. With €14.1B in net profit as the baseline, executives will need to sustain revenue growth in a potentially softening interest-rate environment and navigate geopolitical volatility in key markets like Brazil and Mexico.

The bank has signaled continued investment in digital transformation and ESG metrics, both of which now carry explicit weight in bonus scorecards. As of early 2026, the ECB is conducting ongoing Pillar 2 capital requirement reviews that could influence the total pool available for variable pay in upcoming cycles.

For employees in Portugal, the 2026 remuneration round will test whether the new eligibility rules hold or face union pushback. Labor representatives have already raised formal concerns about the December 2024 policy shift, with negotiations and potential legal challenges anticipated through mid-2026.

Shareholders, meanwhile, will watch whether deferred tranches from the 2025 cycle vest as planned in 2029–2031, a litmus test of whether record profits in one year translate into sustained value creation over the next half-decade.