Spain’s two largest domestically-focused lenders reported contrasting second-quarter results on Wednesday. Banco Santander posted a record net profit of €3.43 billion, 7 percent higher than a year earlier, as higher fee income and a reduction in loan-loss provisions offset weaker lending revenue. The group will return additional capital to shareholders through a €1.7 billion share buyback after ending June with a phased-in CET1 ratio of 13 percent and a return on tangible equity of 16.9 percent. Its non-performing loan ratio stood at 2.91 percent. CaixaBank earned €1.48 billion in the quarter, 11 percent less than the same period of 2024, as a sector-wide banking levy and softer net interest income weighed on results. Even so, the figure surpassed the €1.38 billion market consensus. Net interest income matched expectations at €2.64 billion, while six-month profit rose 10.3 percent to €2.95 billion. At end-June the bank reported a fully-loaded CET1 ratio of 12.5 percent, a return on tangible equity of 18.5 percent and a 2.3 percent bad-loan ratio. Smaller peer Unicaja Banco also released earnings, registering a 2.4 percent year-on-year decline in second-quarter profit. The mixed set of results highlights how Spain’s lenders are contending with a cooling interest-rate tailwind, government taxation and still-benign asset quality as they approach the second half of 2025.