Santander Overtakes UBS to Lead European Banks in 2025 Amid Rising Trade Tensions

In a striking shift across the European banking landscape, Swiss banking giant UBS has lost its status as the largest bank in Europe by market capitalization to Spain’s Banco Santander, against a backdrop of escalating trade tensions and U.S. protectionist policies

According to data from FactSet, Santander’s market capitalization reached €91.3 billion (approximately $103.87 billion) as of April 17, 2025, surpassing UBS, whose valuation declined to 79.5 billion Swiss francs (around $97.23 billion)

This decline coincided with President Trump’s April 2 announcement of a 20% tariff on European Union imports, which triggered a sharp 17.2% drop in UBS shares since the beginning of the year. In contrast, Santander's shares surged by nearly 35% over the same period, buoyed by relative stability in European markets

The divergence in performance between the two banks is partly attributed to their differing exposure to the U.S. market. The American market remains a core pillar of UBS’s global wealth management division, whereas it accounts for only about 9% of Santander’s total profits in 2024

UBS also faces additional headwinds from the Swiss franc’s 8% appreciation against the U.S. dollar since the tariffs were imposed, which has negatively impacted Swiss exports. In response, the Swiss National Bank cut interest rates to 0.25% in March 2025 in a bid to support the domestic economy

Meanwhile, European banks—including Santander—have benefited from EU initiatives aimed at boosting defense spending and easing fiscal restrictions, which have helped brighten the sector’s outlook

This dynamic reshuffling among Europe’s top banks highlights how geopolitical shifts and economic policy changes can significantly reshape the power hierarchy of major financial institutions