Santander Holdings USA, Inc.

Current report

Risks Relating to the Proposed Transaction with Webster

Current report

We Are Expected to Incur Significant Non-Recurring Costs Related to the Proposed Transaction with Webster and the Subsequent Integration of our Respective Businesses.

Current report

We have incurred and expect to incur a number of non-recurring costs associated with the proposed transaction with Webster. These costs include legal, accounting and financial advisory costs and severance/employee-benefit related costs in connection with the transaction. Some of these costs are payable by us regardless of whether or not the transaction is completed.

Current report

We also expected to incur significant costs in connection with the subsequent integration of our and Webster’s respective businesses. There are a number of processes, policies, procedures, operations, technologies and systems that may need to be integrated, including procurement, accounting and finance, legal, payroll, compliance, treasury management, branch operations, vendor management, risk management, lines of business, pricing and benefits. Many of such integration costs are, by their nature, difficult to estimate, and the timing of such costs is uncertain at present.

Current report

We May Fail to Realize All of the Anticipated Benefits of the Proposed Transaction with Webster, and Consolidating our Businesses May be More Difficult, Costly or Time Consuming Than Expected.

Current report

We may fail to realize the anticipated benefits from consolidating our business and Webster’s. To realize these anticipated benefits, we and Webster must successfully integrate our businesses. If we or Webster take longer to, or are not able to, achieve these objectives, the anticipated benefits of the transaction, including the cost synergies expected to be realized, may not be realized fully or at all, or may take longer to realize than expected.

Current report

It is possible that the integration process could take longer or be more costly than anticipated, or could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain relationships with clients, customers, depositors and employees or achieve the anticipated benefits of the transaction. Integration efforts between the two companies will also divert management attention and resources. These integration matters could have an adverse effect on our business following closing of the transaction.

Current report

The Proposed Transaction is Subject to Conditions, Some or All of Which May Not Be Satisfied, Satisfied on a Timely Basis, if at All, or Waived. Failure to Close the Transaction Could Have a Material Adverse Effect on Us.

Current report

Closing of the transaction is subject to a number of conditions, including, among other things, receipt of Webster’s stockholders’ approval and the requisite regulatory approvals, which make closing and timing of closing of the proposed transaction uncertain. The failure to satisfy all of such required conditions could delay closing of the transaction for a significant period of time or prevent it from occurring at all.

Current report

Any delay in closing the transaction could significantly reduce or delay the realization of the anticipated benefits we expect to achieve if we successfully close the transaction within the expected timeframe. There can be no assurance that the conditions to closing the transaction will be satisfied or waived or that the transaction will close. In addition, subject to limited exceptions, either Santander or Webster may terminate the Transaction Agreement if the transaction has not occurred on or before the end date.

Current report

In addition, delays in closing the transaction could, among other things, result in additional transaction costs, loss of revenue or other negative effects associated with uncertainty about closing the transaction, and could materially and adversely impact our ongoing business, financial condition or results of operations following closing of the transaction.

Current report

Regulatory Authorities May Impose Conditions on the Transaction that Could Have an Adverse Effect on Us.

Current report

To close the transaction, we need to obtain approvals, consents from, or make filings with, several U.S. and European regulatory authorities. These regulatory authorities may impose conditions on the closing of the transaction or require changes to the terms of the transaction. There can be no assurance that all of the requisite regulatory approvals will be obtained and, if obtained, there can be no assurance regarding the timing of such approvals, our ability to obtain such approvals on satisfactory terms or the absence of litigation challenging such approvals. In addition, there can be no assurance that such requisite regulatory approvals will not impose conditions or requirements that, individually or in the aggregate, would or could reasonably be expected to have an adverse effect on the assets or business acquired or our financial condition or results of operations following closing of the transaction. Santander is not obligated to close the transaction if any requisite regulatory approval would result in the imposition of a materially burdensome regulatory condition.

Current report

Upon Closing of the Transaction, Certain Change-of-Control Rights Under Agreements to Which Webster Is a Party Will or May Be Triggered, Which May Result in Third Parties Terminating or Altering Existing Contracts or Relationships with Webster or, Following Closing of the Transaction, Us.

Current report

Webster has contracts with third parties which will or may require Webster to obtain consents from such third parties in connection with the transaction. If these consents are not obtained, the counterparties to these contracts may have the ability to terminate, reduce the scope of or otherwise seek to vary the terms of their relationships or the terms of such contracts with Webster in anticipation of the transaction, or with us following closing of the transaction. The pursuit of such rights may result in Webster, or, following closing of the transaction, us, suffering a loss of potential future revenue, incurring liabilities in connection with breaches of agreements or losing rights that are material to Webster’s business and ours. Any such disruptions could limit our ability to achieve the anticipated benefits of the transaction.

Current report

In Connection with the Closing of the Transaction, We Expect to Assume Webster’s Outstanding Debt Obligations and That Each Outstanding Share of Webster’s Preferred Stock Will Be Converted Into the Right to Receive One Share of Newly Created Series of Our Preferred Stock, which May Adversely Affect Our Financial Position and Operating Flexibility.

Current report

In connection with the proposed transaction, we expect to assume Webster’s outstanding indebtedness. Additionally, we expect that each outstanding share of Webster’s Series F and Series G preferred stock will be converted into the right to receive one share of newly created series of our preferred stock, which will have substantially the same terms as Webster’s outstanding Series F and Series G preferred stock, respectively. Our assumption of Webster’s existing debt, together with any future incurrence of additional indebtedness, and our issuance of newly created series of our preferred stock, could have important consequences. For example, they may have the effect of, among other things, reducing our flexibility to respond to changing business and economic conditions, increasing borrowing costs, making it difficult for us to satisfy our financial obligations, including making applicable scheduled principal and interest payments on our indebtedness, limiting our ability to obtain additional financing and require a substantial portion of cash flow to be dedicated to the payment of principal and interest on our indebtedness and dividends on the preferred stock, thereby reducing our ability to use cash flows to fund our operations, capital expenditures and future business opportunities. Any of these factors could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Current report

Additionally, unless Webster’s preferred stock is redeemed in full, we will become subject to certain reporting and corporate governance requirements not previously applicable to us, including the rules and regulations of the applicable listing standards of the New York Stock Exchange. We expect that compliance with these requirements would increase our legal, accounting, and financial compliance costs, make some activities more difficult, time consuming, and costly, and place increased burdens on our personnel, systems, and resources.

Previous report

Recent Executive Orders Related to Tariffs May Result in Increased Risks to our Businesses

Previous report

Several actions related to international trade have taken place in recent months, including reciprocal tariffs among global trade partners. The announcements of these new tariffs as well as exemptions and temporary postponements of certain tariffs, and retaliative tariffs and similar measures announced by some foreign countries, have led to significant volatility in U.S. and global financial markets and concerns related to the possibility of recessionary conditions. If there is an economic downturn or continued significant disruption in financial markets, we may experience increased likelihood of risks to our businesses, including reduced demand for our products and services, reduced capability of our borrowers to timely or fully comply with their existing obligations, adverse effects on the value and liquidity of investment securities we hold or issue, and greater uncertainty related to financial estimates we use in our businesses.

Previous report

Some observers have suggested that tariffs could lead to significantly increased prices for goods and services in the U.S. Any such increased prices could increase our operating costs, decrease the purchasing power of customers leading to a greater potential for delinquencies in our credit portfolios and reduced demand for our products and services, and reduce our overall economic growth.

Previous report

Our auto lending business is a significant source of our lending and funding. We may experience reduced demand for auto lending products and services in the event that tariffs have negative effects on the auto industry and the U.S. economy in general, including reduced auto sales as a result of, among other things, fewer vehicles being manufactured due to supply chain disruptions and higher manufacturing costs, reduced consumer demand for vehicles due to increased manufacturing costs and corresponding higher prices, and a decrease in automobile sales and loan volumes due to the closure and overall reduction in dealerships operating in the U.S. as a result of an economic downturn.