Retail Banking
The Retail Banking segment is primarily comprised of the Bank's branch locations
and the residential mortgage business. The branch locations offer a wide range
of products and services to customers, and attract deposits by offering a variety
of deposit instruments, including demand and interest-bearing demand deposit
accounts, money market and savings accounts, certificates of deposit (CDs) and
retirement savings products. The branch locations also offer consumer loans
such as credit cards, home equity loans and lines of credit, as well as business
banking and small business loans to individuals. The Retail Banking segment
also includes investment services and provides annuities, mutual funds, managed
monies, and insurance products, and acts as an investment brokerage agent to
the customers of the Retail Banking segment.
Auto Finance & Business Banking
The Auto Finance & Business Banking segment currently provides indirect
consumer leasing as well as commercial loans to dealers and financing for commercial
vehicles and municipal equipment. The Auto Finance and Alliances segment includes
the activity related to the Bank's intercompany agreements with SC.
In conjunction with the Chrysler Agreement, the Bank has an agreement with
SC under which SC provides the Bank with the first right to review and assess
Chrysler dealer floor plan lending opportunities and, if the Bank elects, to
provide the proposed financing. Historically and through September 30, 2014,
SC provided servicing under this arrangement. Effective October 1, 2014, the
servicing of all Chrysler Capital receivables from dealers, including receivables
held by the Bank and by SC, were transferred to the Bank. The agreements executed
in connection with this transfer require SC to provide the Bank first right
to review and assess Chrysler Capital dealer lending opportunities which requires
the Bank to pay SC a relationship management fee based upon the performance
and yields of Chrysler Capital dealer loans held by the Bank. All intercompany
revenue and fees between the Bank and SC are eliminated in the consolidated
results of SHUSA. The terms of this lending relationship were renegotiated between
SBNA and SC in the first quarter of 2016. The terms provide greater fee income
opportunity for SC for leads provided that meet SBNA approved credit criteria.
In 2014, the Bank entered into a flow agreement with SC under which the Bank
has the first right to review and approve all prime and super prime Chrysler
Capital consumer vehicle lease applications. SC could review any applications
declined by the Bank for SC’s own portfolio. SC provided servicing and
receives an origination fee on all leases originated under this agreement. All
intercompany revenue and fees between the Bank and SC are eliminated in the
consolidated results of SHUSA. In April 2015, the Bank and SC determined not
to renew this direct origination agreement, which expired by its terms on May
9, 2015.
Real Estate and Commercial Banking
The Real Estate and Commercial Banking segment offers commercial real estate
loans, multifamily loans, commercial loans, and the Bank's related commercial
deposits. This segment also provides financing and deposits for government entities
and niche product financing for specific industries, including oil and gas and
mortgage warehousing, among others.
Global Corporate Banking ("GCB")
The GCB segment serves the needs of global commercial and institutional customers
by leveraging the international footprint of the Santander group to provide
financing and banking services to corporations with over $500 million in annual
revenues. GCB's offerings and strategy are based on Santander's local and global
capabilities in wholesale banking.
Santander Consumer USA Inc. ("SC")
SC is a specialized consumer finance company focused on vehicle finance and
third-party servicing. SC’s primary business is the indirect origination
of RICs, principally through manufacturer-franchised dealers in connection with
their sale of new and used vehicles to retail consumers. In conjunction with
the Chrysler Agreement, SC offers a full spectrum of auto financing products
and services to Chrysler customers and dealers under the Chrysler Capital brand.
These products and services include consumer RICs and leases, as well as dealer
loans for inventory, construction, real estate, working capital and revolving
lines of credit. SC also originates vehicle loans through a web-based direct
lending program, purchases vehicle RICs from other lenders, and services automobile,
recreational and marine vehicle portfolios for other lenders. Additionally,
SC has several other relationships through which it holds personal loans, private-label
credit cards and other consumer finance products. In the third quarter of 2015,
SC announced that it would exit personal lending, and such assets were accordingly
classified as held for sale. In February 2016, SC announced the sale of substantially
all of the $900 million Lending Club portfolio. The remaining personal lending
portfolio is being actively marketed.
SC has entered into a number of intercompany agreements with the Bank as described
above as part of the Auto Finance & Business Banking segment. All intercompany
revenue and fees between the Bank and SC are eliminated in the consolidated
results of SHUSA.