Santander may pay special dividend in 2010

Spain's Santander is considering using a surplus of core capital to pay a special dividend in 2010, Chief Executive Officer Alfredo Saenz said inan interview with the Financial Times on Wednesday.

Santander, the euro zone's largest bank by market capitalisation, is targeting a core capital ratio of 7 percent, though this stood at 7.5 percent at the end of June and would be higher still by the second half of 2010, the newspaper said.

"The organic capital generation of this bank will take us to8.5 percent" Saenz said.

"At this rate, we would then have to make a decision: either we do a bigger payout, an extraordinary dividend, a pay-back, or we stay with 8.5 percent until the legislative clouds have cleared" he told the newspaper.