FINANCIAL INSTITUTIONS

CREDIT OPINION7 January 2020

New Issue

RATINGS

Santander Consumer Bank AGDomicile Germany

Long Term CRR A2

Type LT Counterparty RiskRating - Fgn Curr

Outlook Not Assigned

Long Term Debt Not Assigned

Long Term Deposit A3

Type LT Bank Deposits - FgnCurr

Outlook Positive

Please see the ratings section at the end of this reportfor more information. The ratings and outlook shownreflect information as of the publication date.

Contacts

Bernhard Held, CFA +49.69.70730.973VP-Sr Credit Officerbernhard.held@moodys.com

Alexander Hendricks,CFA

+49.69.70730.779

Associate Managing Directoralexander.hendricks@moodys.com

CLIENT SERVICES

Americas 1-212-553-1653

Asia Pacific 852-3551-3077

Japan 81-3-5408-4100

EMEA 44-20-7772-5454

Santander Consumer Bank AGCredit analysis following rating assignment

SummaryWe assign A3(positive)/P-2 deposit and issuer ratings to Santander Consumer Bank AG(SCB). We also assign a baa1 Baseline Credit Assessment (BCA) and Adjusted BCA to thebank, an A1(cr)/P-1(cr) Counterparty Risk (CR) Assessment and A2/P-1 Counterparty RiskRatings (CRRs).

The ratings reflect (1) SCB’s baa1 BCA and Adjusted BCA; and (2) the results of our Loss GivenFailure (LGF) analysis, which take into account the severity of loss in resolution and lead toone notch of rating uplift for the deposit and issuer ratings from the baa1 Adjusted BCA.We assume a high probability of SCB receiving support, if necessary, from its parent bankSantander Consumer Finance S.A. (SCF, A2 stable/A2 stable, baa2)1. However, this does notyield a rating uplift because SCB’s BCA is already at the same level as the baa1 Adjusted BCAof its parent SCF.

SCB's baa1 BCA reflects its market position as one of Germany’s largest consumer financelenders and its solid credit-risk profile, which benefits from sound capitalisation and assetrisk, resilient profitability, and a satisfactory funding profile. The BCA also reflects the bank’slimited business diversification and resulting monoline business model adjustment given itsstrong reliance on consumer lending for its revenues and profits.

Exhibit 1

Rating Scorecard - Key financial ratios

2.1%

14.9%0.9%

20.1% 9.5%

0%

4%

8%

12%

16%

20%

24%

28%

32%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Asset Risk:Problem Loans/

Gross Loans

Capital:Tangible Common

Equity/Risk-WeightedAssets

Profitability:Net Income/

Tangible Assets

Funding Structure:Market Funds/

Tangible BankingAssets

Liquid Resources:Liquid Banking

Assets/TangibleBanking Assets

Solvency Factors (LHS) Liquidity Factors (RHS)

SCB AG (BCA: baa1) Median baa1-rated banks

So

lve

ncy F

acto

rs

Liq

uid

ity F

acto

rs

Source: Moody's Financial Metrics

MOODY'S INVESTORS SERVICE FINANCIAL INSTITUTIONS

Credit strengths

» Overall solid solvency implies satisfactory resilience to shocks, particularly because of sound capitalisation, as well as steadilyimproving asset quality and good profitability compared with that of its domestic peers.

» An agreed framework for capital increases and subscription of junior senior unsecured instruments will allow SCB to absorb risk-weighted assets (RWA) and balance-sheet growth while maintaining its financial metrics.

» SCB has an only modest reliance on market funds as it mostly relies on granular deposits for its funding.

Credit challenges

» SCB’s profile as a consumer lending specialist, including related high concentration in auto loans and stock financing for car dealersrelative to its capital, implies vulnerability to sector-related stress and product-specific risks.

» Weakening operating environment in Germany will require further strengthening of the bank's solvency and liquidity metrics tomaintain its baa1 financial profile.

» Its level of unencumbered liquid assets is a relative weakness in an overall solid credit profile.

Outlook

» The outlook on SCB’s ratings is positive, reflecting our expectation that the bank may benefit from the inclusion of additional loss-absorbing debt instruments in its liability structure.

Factors that could lead to an upgrade

» An upgrade of SCB's ratings could be prompted by: 1) a higher BCA and Adjusted BCA; and/or 2) a change in SCB's liability structurethat could prompt a better result from our Advanced LGF analysis, for example through the issuance of additional volumes of juniorsenior unsecured and subordinated bonds.

» Although considered unlikely, an upgrade of SCB's baa1 BCA could be prompted by a successful diversification of revenues andprofits to reduce its reliance on its main line of business, consumer finance; a material increase in its capitalisation beyond ourcurrent expectation; or if SCB meaningfully raises its level of unencumbered liquidity.

Factors that could lead to a downgrade

» A downgrade of SCB's issuer and deposit ratings could be prompted by: 1) a BCA downgrade, unless the downgrade was offset byaffiliate support; or 2) a weaker result from our Advanced LGF analysis as a result of a declining layer of instruments designed toabsorb losses in the case of failure. The latter is currently very unlikely, as reflected by the positive outlook.

» SCB's BCA could be downgraded if SCB fails to improve its solvency and liquidity profile through stronger profits without assumingadditional exposure to cyclical risks or to higher risk segments of the automotive finance spectrum, or meaningfully improvingcapital and liquidity buffers.

» A downgrade of the BCA of Santander or of the Adjusted BCA of SCF would only result in a downgrade of SCB’s Adjusted BCA andlong-term ratings if SCB’s operations became less independent from and instead more tightly integrated into the operations of itsparent banks.

This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page onwww.moodys.com for the most updated credit rating action information and rating history.

2 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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Key Indicators

Exhibit 2

Santander Consumer Bank AG (Unconsolidated Financials) [1]

12-182 12-172 12-162 12-152 12-142 CAGR/Avg.3

Total Assets (EUR Billion) 35.1 34.0 34.2 42.1 38.6 (2.4)4

Total Assets (USD Billion) 40.1 40.9 36.1 45.8 46.8 (3.8)4

Tangible Common Equity (EUR Billion) 2.9 2.9 2.8 2.7 2.7 1.34

Tangible Common Equity (USD Billion) 3.3 3.4 3.0 3.0 3.3 (0.1)4

Problem Loans / Gross Loans (%) 1.9 2.1 2.1 3.0 3.2 2.55

Tangible Common Equity / Risk Weighted Assets (%) 14.9 13.7 14.0 13.7 13.2 13.96

Problem Loans / (Tangible Common Equity + Loan Loss Reserve) (%) 17.1 19.2 19.4 25.5 27.6 21.85

Net Interest Margin (%) 3.3 3.3 3.0 2.9 3.1 3.15

PPI / Average RWA (%) 2.6 2.3 3.1 3.3 3.3 2.96

Net Income / Tangible Assets (%) 0.9 0.8 1.1 0.9 0.2 0.85

Cost / Income Ratio (%) 61.2 66.4 56.9 55.8 57.5 59.65

Market Funds / Tangible Banking Assets (%) 18.6 19.4 17.4 11.9 5.1 14.55

Liquid Banking Assets / Tangible Banking Assets (%) 12.9 7.6 7.7 22.7 19.3 14.05

Gross Loans / Due to Customers (%) 133.8 139.8 132.7 124.3 120.7 130.35

[1]All figures and ratios are adjusted using Moody's standard adjustments. [2]Basel III - fully-loaded or transitional phase-in; LOCAL GAAP. [3]May include rounding differences due toscale of reported amounts. [4]Compound Annual Growth Rate (%) based on time period presented for the latest accounting regime. [5]Simple average of periods presented for the latestaccounting regime. [6]Simple average of Basel III periods presented.Source: Moody's Investors Service; Company Filings

ProfileSantander Consumer Bank AG (SCB) is a fully owned subsidiary of Santander Consumer Finance S.A., Spain (SCF), and is ultimatelyowned by Banco Santander S.A. (Spain) (A2 stable/A2 stable, baa1). With total assets of €35.1 billion as of December 2018 (excludingretained securitisations), SCB is one of the largest dedicated German consumer lenders with clear focus on retail auto financing and astrong market position within the non-captive automotive finance space.

The bank predominantly provides retail auto financing (49% of lending as of year-end 2018) and various other consumer, retail andcorporate loans (51%). The latter categories include direct retail loans (17% of total loans), mortgage loans (11%) and durables finance(5%). Headquartered in Moenchengladbach in Germany, SCB is Germany’s largest manufacturer-independent financier of cars andsecond-largest auto finance company overall and SCB has strong market positions in non-auto consumer finance, which it marketsthrough its branch network, commercial retail partners (point of sale) and, increasingly, online. SCB acts as the captive auto financecompany for the Volvo and Mazda car brands in Germany, and holds a 51% share in Hyundai Capital Bank Europe GmbH and a 50%share in PSA Bank Deutschland GmbH.

Detailed credit considerationsSound asset risk is likely to show stable developmentSCB’s sound asset profile is reflected in its baa1 Asset Risk score, which includes a two-notch downward adjustment from the a2 initialscore to highlight the risks relating to sector concentrations and operational risk. SCB’s relatively low asset risk is illustrated by modestproblem loans and low loan-loss provisions in recent years.

The most prominent risk is credit risk related to its consumer finance operations. The vast majority of SCB’s loan book is highlygranular, given that it mostly comprises car finance loans and leasing, consumer loans, mortgage loans and its credit card business, allof which constitute lending with small or very small ticket sizes. These portfolios have strongly benefitted from Germany’s extendedperiod of healthy market parameters, in particular, low unemployment and moderate wage growth.

3 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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Key risks not currently reflected in the bank’s problem loan metrics are (1) its high indirect sector exposure relating to the automotiveindustry; and (2) legal risks in the context of court rulings favouring consumers, for example, on the scope of fees and charges. Aneconomic downturn or industry-related stress would adversely affect car dealers to which SCB provides inventory financing facilities.Loans to car buyers and dealers accounted for 49% of all lending as of year-end 2018, representing a high 5.2x of its tangible commonequity (TCE), down from 5.5x as of 31 December 2017. Legal risks affected the bank in 2014 when a German court ruled that feescharged for loan contracts had to be returned to clients, costing the bank more than €400 million in compensation.

SCB’s problem loans relative to gross loans improved steadily over the past years to a moderate 1.9% of gross loans (year-end 2017:2.1%). The good metrics history partly benefits from SCB’s strong receivables collection management and occasional problem loansales. We expect SCB’s stock of problem loans to be hurt by the weakening economic outlook for Germany. While, the low level ofunemployment in Germany will remain supportive of the bank’s credit quality, we believe that the particular challenges to export-oriented sectors, including the automotive industry, may lead to higher credit costs in 2020.

SCB’s lending activities beyond the mobility area include direct retail loans (€5.0 billion as of year-end 2018), mortgage loans (€3.4billion), durables finance (€1.5 billion), direct corporate loans (€1.3 billion) and its credit card business. With this product suite, SCB'sasset profile shows a higher degree of diversification than other entities within the Santander Consumer Finance group.

Exhibit 3

SCB's problem loan ratio fell below 2% in 2018

0%

25%

50%

75%

100%

125%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

2014 2015 2016 2017 2018

Problem Loans / Gross Loans Coverage ratio (right axis)

Problem loan ratio in accordance with Moody's definition. The coverage ratio compares total loan-loss reserves to problem loans.Source: Company reports and Moody's Investors Service

Regulatory capitalisation is sound, providing a suitable buffer under less benign conditionsSCB’s sound capitalisation is reflected in the a1 Capital score, which is in line with the initial score. We assess SCB’s capitalisation assound in the context of the risks that the bank has taken in the field of auto finance secured lending and unsecured consumer lending,and expect its TCE ratio, which stood at 14.9% as of year-end 2018, to remain above 14%.

The Common Equity Tier 1 (CET1) capital ratio was 13.9% as of December 2018, up from 12.5% a year earlier. RWA declined during2018, partly as a result of an asset-backed risk transfer transaction covering €1.6 billion of direct customer loans closed in December2018. SCB aims to raise its CET1 ratio sustainably above 14% to maintain a suitable buffer to its individual capital requirements.Despite the automatic upstreaming of its profit to the German holding company under its profit and loss transfer agreement, SCB hasadequate leeway to decide on the retention of suitable portions of its profit and agrees to any retention or reinvestment of profit bythe parent as part of the group’s 36-month rolling capital planning.

SCB reported a sound and stable regulatory Tier 1 leverage ratio of 7.4% as of the end of December 2018. Based on our leverage metricof TCE/tangible assets, the ratio was 8.1% (December 2017: 8.4%), reflecting the smaller denominator after the netting of self-retainedABS tranches with the corresponding liabilities. SCB uses the Internal Ratings-Based Approach for most of its loan assets.

4 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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Exhibit 4

Risk-weighted capitalisation improved in 2018In % of RWA

Exhibit 5

SCB's regulatory capital requirementsIn % of RWA

14.0% 13.7%

14.9%

13.2%12.5%

13.9%

8.3% 8.5% 8.2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

2016 2017 2018

TCE ratio CET1 ratio (transitional) TCE leverage ratio

TCE = Tangible common equity (Moody's-calculated); CET1 = Common Equity Tier 1; TheTCE leverage ratio compares TCE to tangible banking assets.Sources: Company reports and Moody's Investors Service

11.26%11.63%

12.25%

0%

2%

4%

6%

8%

10%

12%

14%

2017 2018 2019F

Pillar 1 - CET1 Pillar 1 - Tier 1 Pillar 1 - Tier 2

Pillar 2 Capital conservation buffer Countercyclical buffer

Sources: Company reports and Moody's Investors Service

Profitability is sound but under pressure from the low interest rate environmentThe baa1 score for Profitability includes an adjustment for taxes (paid at the holding level) and an adjustment for tangible bankingassets, to account for the assets employed by SCB’s fully owned, but unconsolidated affiliate Santander Consumer Leasing GmbH togenerate its profit, which is included in SCB’s profit and loss account. In addition, we factor into this score the bank’s relatively highstability of revenue and profit, and sound risk charge cover by pre-provision income.

Our assessment illustrates that SCB’s business model affords profits considerably above the average in the German banking market.For 2019-20, we expect revenue, and therefore profit, to stabilise following the conclusion of SCB’s restructuring programme initiatedin 2017, which resulted in a leaner and unified branch network. In line with overall market rates on consumer loans, SCB’s net interestmargin and result have held up well during 2018. With domestic demand and employment having proven resilient so far againsta weaker external trade outlook, we believe that the cyclical and structural challenges for the automotive sector, to which SCB is(foremost indirectly) heavily exposed, constitute the most relevant source of potentially higher loan-loss provisions during the outlookhorizon.

SCB reported a €463 million pretax profit for 2018 (2017: €392 million), which was fully transferred to its German holding companyunder the existing profit and loss transfer agreement. SCB’s local GAAP pretax income is supported by dividend payments fromaffiliates held at equity, foremost by the €40.1 million of earnings transfer from Santander Consumer Leasing GmbH (2017: €49.2million). Moderate loan-loss provisions, at €65 million (2017: €98 million), supported the 2018 pretax result.

During 2018, SCB’s net fee income declined markedly to €110 million from €150 million in 2017, reflecting weaker fee income fromboth securities transactions and insurance brokerage. The bank aims to compensate this, in part, through additional fee income in itsbusiness and corporate banking segment, but also expects the recovery of securities- and insurance-related fee income. With a cost-to-income ratio of 61% in 2018, the bank’s efficiency compares favourably with that of most retail banking focused peers in Germany.

5 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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Exhibit 6

Profitability remains above the average of German banksin € millions, German GAAP

110 547 517 392

440

1,175 1,177 1,157 1,133 1,138

(907) (858) (809) (936) (819)

-1500

-1000

-500

0

500

1000

1500

2000

2500

2014 2015 2016 2017 2018

Net interest Income Net fees and commissions income Trading & other income

Admin. Expenses Risk provisions Extraordinary income and expense

Pre-tax profit

Operating expenses include personnel, administrative expenses, and depreciations and amortisation.Sources: Company reports and Moody's Investors Service

Dependence on market funds is low, but moderately increasing amid growing diversification of funding sourcesSCB’s adequate funding is reflected in the baa1 Funding Structure score, which includes a one-notch downward adjustment based onour expectation of increasing market funding, in particular driven by additional commercial paper issuance and the placement of asecond benchmark-size senior unsecured bearer bond.

SCB has sound funding with a low dependence on market funds. Its lending activities are largely funded by client deposits, which, at€22.6 billion as of year-end 2018, funded 65% of its tangible banking assets. One-third of the client deposits were term deposits, ofwhich €5.7 billion (25% of customer deposits) had maturities over three months.

The bank has not relied on any unsecured bond issuances until 2017, when it issued its first €500 million junior senior unsecured (seniornon-preferred) bond. In October 2019, this was followed by a senior unsecured (senior preferred) bond issuance of the same size. Thebank launched a commercial paper programme in 2018 and increased the usage of its mortgage covered bond programme to €500million (accounted for with 50% of issuance volume in our market funds ratio) during 2019. The €5.4 billion in interbank funds contain€4.9 billion of medium-term repo funds (TLTRO funds) transacted with the European Central Bank (ECB), down from €5.5 billion as ofDecember 2017, following a partial repayment in 2018. We understand that SCB’s management plans to participate in the upcomingthird TLTRO. For the required repo collateral, SCB mostly uses self-originated ABS. The bank has also placed several ABS with investorsin public and previously private transactions, but maintains a sizeable volume of these outstanding bonds on its own balance sheet.

Exhibit 7

Moderate increase in market funding, but deposits remain dominant refinancing tool

17%19% 19%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2016 2017 2018

Equity Other liabilities Issued securities Interbank Deposits Market Funds Ratio* (right axis)

*Market funds ratio = Market funds/tangible banking assets.Sources: Company reports and Moody's Investors Service

6 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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SCB has adequate liquidity buffersThe bank’s assigned Liquid Resources score is ba1, at the same level as its initial score. The ba1 score reflects our expectation that SCB’son-balance-sheet liquid resources will remain below 10% of tangible banking assets. At the same time, SCB exhibits a strong degree ofcompliance with the regulatory liquidity coverage ratio requirements, and has the possibility to generate additional liquidity foremostthrough its asset-backed-securities programmes and its mortgage- covered bond programme.

Overall, the bank maintains adequate liquidity buffers, as illustrated by the 169% liquidity coverage ratio reported as of year-end 2018.Analytically, we deduct from liquid resources the bank’s €1.5 billion of claims against financial institutions, which consist almost fully ofterm deposits with affiliates. These claims serve as the refinancing of the affiliates’ assets, including, for instance the lease assets heldby Santander Consumer Leasing GmbH, which in practice limits their availability at short notice.

The bank’s €8.0 billion fixed-income securities portfolio as of December 2018 consisted entirely of retained ABS tranches sponsoredby SCB, which the bank continues to hold on its balance sheet. Thereof, the bank had placed €5.2 billion with the ECB as collateral fora total of €4.9 billion of funds sourced through the TLTRO. The remaining fixed-income instruments are not eligible for central bankrepo transactions, but could in principle be sold or pledged more quickly than the underlying auto and consumer loans. Under SCB’smortgage-covered bond programme, the bank had around €0.3 billion of additional issuance capacity as of year-end 2018, beforefalling under the 8% over-collateralisation requirement to maintain the current rating level.

Exhibit 8

SCB maintains adequate liquidity buffersIn % of tangible banking assets

8% 8%

13%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2016 2017 2018

Other assets Loans Securities/Investments Interbank Cash Liquid Banking Asset Ratio (right axis)

*Liquid banking assets ratio = Liquid assets/tangible banking assets.Sources: Company reports and Moody's Investors Service

Lack of business diversification constrains the BCAWe apply a downward adjustment by one notch to the scorecard outcome for SCB’s lack of business diversification because the bank isalmost exclusively involved in consumer finance. This qualitative adjustment to the BCA reflects the bank's reliance on a single line ofbusiness (and market segment) for most of its revenue and profit. If SCB develops its business profile towards a more universal bankingmodel, we may review the appropriateness of this adjustment.

We reduce SCB's weighted-average outcome of the assigned Financial Profile factor scores by one full notch. This adjustment reflectsthe bank's strongly focused business profile as a provider of consumer lending products. SCB specialises in unsecured consumer lending,consumer goods finance as well as captive and non-captive auto finance and lending to borrowers related to the automobile industry.We, therefore, classify SCB as a monoline bank according to our approach for business diversification.

Business diversification is an important gauge of a bank's sensitivity to stress in a single business line. Business diversification is relatedto earnings stability in the sense that earnings diversification across distinct and relatively uncorrelated lines of business increases thereliability of a bank's earnings streams and its potential to absorb shocks affecting a business line.

7 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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SCB's high reliance on consumer and car finance-related earnings streams limits its potential for earnings diversification and exposesit to unexpected shocks outside its direct control. At the same time, SCB benefits from its specialist risk management know-how inmanaging related business cycle and operational risks.

Macro Profile of Strong+SCB is focused on the German market, and the bank's assigned Strong+ Weighted Macro Profile is at the same level as the Strong+Macro Profile of Germany.

Environmental, social and governance considerationsIn line with our general view on the banking sector, SCB has a low exposure to environmental risks2 (see our environmental risksheat map for further information). Given the concentration on auto finance, the bank is particularly exposed to the challenges theautomotive industry faces related to carbon transition. SCB could face credit losses in the event of higher car dealer default rates, in thecase these fail to adapt to the changing industry landscape. SCB could also face a stronger-than-expected decline in the value of loancollateral from both conventional combustion engines and new loans backed by alternative fuel vehicles if the technological changehappens in an abrupt and disruptive way rather than in a smooth transition process.

Regarding social risks3, we place SCB in line with our general view for the banking sector, which indicates a moderate exposure (see oursocial risks heat map). SCB has a high exposure to consumer lending, which carries higher margins than residential mortgage lending,but is also particularly exposed to challenges by consumer protection associations.

Governance4 is highly relevant for SCB, as it is to all banks. SCB has an appropriate risk management framework commensurate with itsrisk appetite. As such, we do not have specific governance concerns for SCB. Nonetheless, corporate governance remains a key creditconsideration and continues to be a subject of our ongoing monitoring

Support and structural considerationsAffiliate supportWe consider that there is a high probability that SCF would support SCB in case of need. However, this assumption does not yield anyuplift for SCB’s ratings because the bank’s baa1 BCA is already at the same level as its parent bank’s Adjusted BCA. Support from SCF isillustrated by its high degree of involvement in the strategy and management of SCB's operations.

Loss Given Failure (LGF) analysisSCB is subject to the European Union Bank Recovery and Resolution Directive (BRRD), which we consider to be an operationalresolution regime. We, therefore, apply our Advanced LGF analysis, taking into account the risks faced by the different debt and depositclasses across the liability structure, should the bank enter resolution. We assume residual TCE of 3% and post-failure losses of 8% oftangible banking assets, a 25% runoff in “junior” wholesale deposits and a 5% runoff in preferred deposits. These ratios are in line withour standard assumptions. In addition, we assume a 10% share of wholesale deposits relative to total deposits, which is our standardassumption for banks relying mostly on retail deposits.

» For deposits of SCB, our LGF analysis indicates a low loss-given-failure, leading to a one-notch uplift from its baa1 Adjusted BCA.

» For the issuer rating — which is the equivalent rating level to senior unsecured debt — our LGF analysis also indicates a low loss-given-failure, leading to a one-notch uplift from its baa1 Adjusted BCA.

Government supportGerman banks operate in an environment of weak prospects for financial assistance from the government. We, therefore, generallyassume a “low” probability of support for banks that are not considered to be of global or domestic systemic relevance, including SCB.As a result, we do not apply a rating uplift from government support in our ratings for SCB.

Counterparty Risk Ratings (CRRs)CRRs are opinions of the ability of entities to honour the uncollateralised portion of non-debt counterparty financial liabilities (CRRliabilities) and also reflect the expected financial losses in the event such liabilities are not honoured. CRR liabilities typically relate totransactions with unrelated parties. Examples of CRR liabilities include the uncollateralised portion of payables arising from derivatives

8 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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transactions and the uncollateralised portion of liabilities under sale and repurchase agreements. The CRR is distinct from ratingsassigned to senior unsecured debt instruments and from issuer ratings. This is because the CRR reflects the expected loss on seniornon-debt counterparty financial liabilities that, in a resolution, might benefit from preferential treatment compared with seniorunsecured debt.

SCB's CRRs are positioned at A2/P-1SCB’s CRRs are positioned two notches above the Adjusted BCA of baa1, reflecting the very low loss given failure supported by thesignificantly increasing amount of subordinated instruments, in particular at the junior senior unsecured debt level.

Counterparty Risk (CR) AssessmentCR Assessments are opinions of how counterparty obligations are likely to be treated if a bank fails. They are distinct from debt anddeposit ratings in that they (1) consider only the risk of default rather than both the likelihood of default and the expected financial losssuffered in the event of default, and (2) apply to counterparty obligations and contractual commitments rather than debt or depositinstruments. The CR Assessment is an opinion of the counterparty risk related to a bank's covered bonds, contractual performanceobligations (servicing), derivatives (for example, swaps), letters of credit, guarantees and liquidity facilities.

SCB’s CR Assessment is positioned at A1(cr)/P-1(cr)SCB’s CR Assessment is positioned three notches above the Adjusted BCA of baa1, based on the buffer against default provided to thesenior obligations represented by the CR Assessment by more subordinated instruments — including the bank’s junior deposits andsenior unsecured debt. To determine the CR Assessment we focus purely on subordination, taking no account of the volume of theinstrument class.

Methodology and scorecardRating methodologyThe principal rating methodology used to rate SCB was our Banks rating methodology, published in November 2019.

About Moody’s Bank ScorecardOur Bank Scorecard is designed to capture, express and explain in summary form our Rating Committee's judgement. When readin conjunction with our research, a fulsome presentation of our judgement is expressed. As a result, the output of our scorecardmay materially differ from that suggested by raw data alone (though it has been calibrated to avoid the frequent need for strongdivergence). The scorecard output and the individual scores are discussed in rating committees and may be adjusted up or down toreflect conditions specific to each rated entity.

9 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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Rating methodology and scorecard factors

Exhibit 9

Santander Consumer Bank AG

Macro FactorsWeighted Macro Profile Strong + 100%

Factor HistoricRatio

InitialScore

ExpectedTrend

Assigned Score Key driver #1 Key driver #2

SolvencyAsset RiskProblem Loans / Gross Loans 2.1% a2 ←→ baa1 Sector concentration Operational risk

CapitalTangible Common Equity / Risk Weighted Assets(Basel III - transitional phase-in)

14.9% a1 ←→ a1 Capital retention Expected trend

ProfitabilityNet Income / Tangible Assets 0.9% baa1 ←→ baa1 Expected trend Loan loss

charge coverageCombined Solvency Score a2 a3LiquidityFunding StructureMarket Funds / Tangible Banking Assets 18.6% a3 ←→ baa1 Deposit quality Expected trend

Liquid ResourcesLiquid Banking Assets / Tangible Banking Assets 12.9% ba1 ←→ ba1 Stock of liquid assets Asset encumbrance

Combined Liquidity Score baa2 baa2Financial Profile baa1Qualitative Adjustments Adjustment

Business Diversification -1Opacity and Complexity 0Corporate Behavior 0

Total Qualitative Adjustments -1Sovereign or Affiliate constraint AaaBCA Scorecard-indicated Outcome - Range baa1 - baa3Assigned BCA baa1Affiliate Support notching 0Adjusted BCA baa1

Balance Sheet is not applicable.

10 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

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De Jure waterfall De Facto waterfall NotchingDebt ClassInstrumentvolume +

subordination

Sub-ordination

Instrumentvolume +

subordination

Sub-ordination

De Jure De FactoLGF

NotchingGuidance

vs.Adjusted

BCA

AssignedLGF

notching

AdditionalNotching

PreliminaryRating

Assessment

Counterparty Risk Rating - - - - - - - 2 0 a2Counterparty Risk Assessment - - - - - - - 3 0 a1 (cr)Deposits - - - - - - - 1 0 a3

Instrument Class Loss GivenFailure notching

Additionalnotching

Preliminary RatingAssessment

GovernmentSupport notching

Local CurrencyRating

ForeignCurrency

RatingCounterparty Risk Rating 2 0 a2 0 A2 A2Counterparty Risk Assessment 3 0 a1 (cr) 0 A1(cr)Deposits 1 0 a3 0 A3 A3[1]Where dashes are shown for a particular factor (or sub-factor), the score is based on non-public information.Source: Moody’s Investors Service

Ratings

Exhibit 10

Category Moody's RatingSANTANDER CONSUMER BANK AG

Outlook PositiveCounterparty Risk Rating A2/P-1Bank Deposits A3/P-2Baseline Credit Assessment baa1Adjusted Baseline Credit Assessment baa1Counterparty Risk Assessment A1(cr)/P-1(cr)Issuer Rating A3

PARENT: SANTANDER CONSUMER FINANCE S.A.

Outlook StableCounterparty Risk Rating A2/P-1Bank Deposits -Dom Curr A2/P-1Baseline Credit Assessment baa2Adjusted Baseline Credit Assessment baa1Counterparty Risk Assessment A3(cr)/P-2(cr)Senior Unsecured A2Junior Senior Unsecured -Dom Curr Baa1Subordinate -Dom Curr Baa2Pref. Stock Non-cumulative -Dom Curr Ba1 (hyb)Commercial Paper -Dom Curr P-1

Source: Moody's Investors Service

11 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

MOODY'S INVESTORS SERVICE FINANCIAL INSTITUTIONS

Endnotes1 The ratings shown in this report are the banks’ deposit rating and outlook, senior unsecured rating and outlook, and BCA.

2 Environmental risks can be defined as environmental hazards encompassing the impacts of air pollution, soil/water pollution, water shortages and naturaland man-made hazards (physical risks). Additionally, regulatory or policy risks, like the impact of carbon regulation or other regulatory restrictions,including the related transition risks like policy, legal, technology and market shifts, that could impair the evaluation of assets are an important factor.Certain banks could face a higher risk from concentrated lending to individual sectors or operations exposed to the aforementioned risks.

3 Social risk considerations represent a broad spectrum, including customer relations, human capital, demographic and societal trends, health and safetyand responsible production. The most relevant social risks for banks arise from the way they interact with their customers. Social risks are particularly highin the area of data security and customer privacy, which is partly mitigated by sizeable technology investments and banks’ long track record of handlingsensitive client data. Fines and reputational damage because of product mis-selling or other types of misconduct is a further social risk. Social trends arealso relevant in a number of areas, such as shifting customer preferences towards digital banking services increasing information technology costs, ageingpopulation concerns in several countries affecting the demand for financial services, or socially driven policy agendas translating into regulations thataffect banks’ revenue bases.

4 Corporate governance is a well-established key driver for banks and related risks are typically included in our evaluation of the banks' financial profile.Further, factors like specific corporate behaviour, key person risk, insider and related-party risk, strategy and management risk factors and dividend policy,may be captured in individual adjustments to the BCA, if deemed applicable. Corporate governance weaknesses can lead to a deterioration in a company’scredit quality, while governance strengths can benefit its credit profile. When credit quality deteriorates because of poor governance, such as a break downin controls resulting in financial misconduct, it can take a long time to recover. Governance risks are also largely internal rather than externally driven.

12 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

MOODY'S INVESTORS SERVICE FINANCIAL INSTITUTIONS

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REPORT NUMBER 1206070

13 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment

MOODY'S INVESTORS SERVICE FINANCIAL INSTITUTIONS

Contacts

Hannah Dimpker +49.69.70730.978Associate Analysthannah.dimpker@moodys.com

CLIENT SERVICES

Americas 1-212-553-1653

Asia Pacific 852-3551-3077

Japan 81-3-5408-4100

EMEA 44-20-7772-5454

14 7 January 2020 Santander Consumer Bank AG: Credit analysis following rating assignment