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SCH crisis fund grows
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January 22, 2002: 5:09 a.m. ET
Spain's biggest bank sets aside more money for Argentina crisis
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MADRID, Spain (CNN) - Santander Central Hispano, Spain's biggest bank, said its profit fell short of expectations after setting aside more money for the Argentina crisis.
SCH and Banco Bilbao Vizcaya Argentaria, Spain's second biggest bank, have seen their shares come under pressure amid concerns about their exposure to defaulters in Argentina and were forced to covert dollar loans to pesos.
The bank plans to set aside  1.29 billion ($1 billion) to cover losses in Argentina, where it owns the fourth-biggest bank Banco Rio. That's up from its previous provision of 1 billion.
SCH said its net income fell 10.1 percent to 2.49 billion last year. Three months ago, SCH said it expected earnings to rise by 16 percent, with analysts polled by Reuters forecasting a profit of 2.61 billion.
The bank cut its 2001 profit forecast in October for the second time last year because of global economic slowdown, a tougher business climate after September's attacks in the U.S. and the Argentine situation.
SCH stock, which fell 17 percent last year, was little changed at 9.09 in early Madrid trading on Tuesday. Its rival BBVA saw its stock tumble 12 percent in 2001.
Both banks have 4 to 5 percent of their total assets in Argentina, which has been forced to give up its peso-dollar peg in an attempt to pull itself out of a long economic crisis which has caused widespread rioting and a string of short-lived governments.
Chairman Emilio Botin has said SCH would leave Argentina if the country's financial system collapses. Moody's Investor Service said banks in Argentina could faces losses of up to $54 billion after the government defaulted on loans. 
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