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Last year started with a failed stress test and ended with the bank under scrutiny for everything from its capital management to its subprime auto lending policies. But regaining the confidence of regulators is only half the battle; Santander must also figure out how to regain market share its been losing to competitors.
January 5 -
The Dallas-based subprime auto lender lowered its provision for losses in the fourth quarter even as delinquencies and chargeoffs continued to creep up.
February 3 -
Government investigations of auto lending are beginning to pile up, and they are weighing on investors' perceptions of the fast-growing industry.
January 9 -
Santander Consumer USA, Ally Financial and Capital One are among the companies facing scrutiny over their loans to borrowers with low credit scores.
November 4 -
Santander Holdings USA entered into a written agreement with the Federal Reserve Bank of Boston about managing capital payments after one of its units issued an unauthorized dividend.
September 18
The chairman and chief executive of Santander Consumer USA Holdings has resigned, as the subprime auto lender remains under scrutiny for its lending and securitization practices.
Thomas Dundon is leaving to "pursue new opportunities," Santander Consumer said in a news release, without providing additional details. Dundon will remain on Santander Consumer's board.
Santander Consumer named Chief Financial Officer Jason Kulas the new CEO and named Stephen Ferriss, lead outside director, the interim chairman until the Dallas company's annual meeting on July 15. Kulas' appointment as CEO is "in line with [Santander Consumer's] Board-approved succession plan," the company said in the release.
The changes to Dundon's role "have been amicably agreed and are unrelated to the company's performance or regulatory standing," Kulas said in the release.
Santander Consumer will also buy out Dundon's stake in the company at a cost of more than $928 million. It will pay him $26.83 a share for the nearly 10% stake he holds, according to a filing with the Securities and Exchange Commission.
Dundon helped found the company, formerly Drive Financial Services, in 1994 and he retained an ownership stake after the Spanish banking giant Banco Santander bought a majority stake in 2006. Santander paid $651 million for about 61% of the company.
"This is a great company and with Jason Kulas at the helm, supported by our talented management team, I am confident [it] will become an even stronger player in the consumer finance industry," Dundon said in the release.
However, the company's financial performance has been strong in the last year. Its stock initially fell after its January 2014 IPO, but it has rebounded strongly this year, and its stock price is up nearly 34% over the past 12 months. It has also
Kulas has been CFO of Santander Consumer since 2007. Earlier, he had covered the company as an investment banker at JPMorgan.
Additionally, Jason Grubb, Santander Consumer's chief operating officer of originations, will become president, and chief accounting officer Jennifer Popp has been named interim CFO.
Santander Consumer managed about $46 billion in assets as of March 31. Along with subprime auto loans, it also makes prime auto loans and personal loans.
