Banco Santander is reportedly considering acquiring the publicly traded shares of its US auto finance lender, Santander Consumer USA Holdings Inc., as the US company experiences downward pressure on its stock price on rising concerns over sub-prime lending in the US auto sector.
The share price of Santander Consumer USA Holdings has declined by around a quarter since its January IPO.
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A Bloomberg report suggested that Santander views the unit as an undervalued asset that may perform better off the public markets.
The report cited anonymous sources as saying that it is now reviewing options, including buying back the shares.
Bloomberg also noted that Santander is one of the largest originators of sub-prime car loans in the US and that its shares have been hit by rising worries over the sub-prime auto lending market that is helping to propel the US vehicle market.
Santander sold a quarter of its equity in its US auto loans unit to private equity investors at the height of the financial crisis and those investors decided to offload for a public float in January this year.
The US company says it has active relationships with over 14,000 dealers throughout the US.
