Santander’s U.S. Auto Lender Tumbles on Delay in Earnings Reportby
Banco Santander SA’s car-financing unit in the U.S. tumbled in New York trading after saying it will delay release of its second-quarter financial report.
Santander Consumer USA Holdings Inc.’s shares fell 15 percent to $10.09 at 9:33 a.m., the most intraday since January 27. The stock declined 25 percent this year through July 22, compared with the 1 percent advance of the Russell 1000 Financial Services Index.
The lender said it was “in discussions with its current and previous independent accountants regarding certain accounting matters, primarily related to the company’s discount accretion and credit loss allowance methodologies,” according to a statement Monday from the Dallas-based company. The resolution may affect prior financial statements, as well, said the bank, which was scheduled to report second-quarter results on Wednesday.
“We expect weakness in the stock given as this is the second delay in filing of its financial statements in the past six months, raising investor concerns regarding processes and controls at the company,” JPMorgan Chase & Co. analysts led by Richard Shane said in a note to investors.
Santander Consumer in March lowered its profit figures for the last three years and the fourth quarter after earlier missing a second deadline for publishing its annual report. In the March 31 filing, the firm acknowledged deficiencies in its reporting, including its method of estimating provisions and in controls to ensure employees have sufficient expertise.