SCH Letter to Intermediaries

Banco Santander Central Hispano SA
10 September 2004


            Santander letter to independent financial intermediaries

   NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED
                 STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN

The following is the text of a letter being sent today by Juan Rodriguez
Inciarte, Executive Vice President, Banco Santander Central Hispano
('Santander') to independent financial intermediaries in the UK:

'I am sure you are aware of Santander's recommended acquisition of Abbey
National plc ('Abbey'), which was announced on 26 July 2004.

I am pleased to be able to tell you that, as announced, the Scheme Document is
due to be posted to Abbey shareholders later this month and that, in the absence
of any unexpected delays in obtaining the necessary approvals, we are now aiming
to complete the transaction in November.

Given the importance of financial intermediaries to Abbey's continuing business,
I therefore thought this would be a good moment to:

• Give you some background information on Santander, which is a 150 year
  old global bank;

• Tell you about our plans to accelerate the Abbey turnaround; and

• Explain why Abbey's relationships with intermediaries are important to
  us.

Firstly, some background details about Santander.

We were established in 1857 in the Spanish port town of Santander. Since then we
have grown to become one of the largest banks in the world, with approximately
41 million customers and a presence in more than 40 countries.

Today Santander is the second largest bank in the Euro zone and the 16th largest
in the world by market capitalisation. Last year we delivered our highest profit
ever - €2.6 billion (£1.8 billion)*. Between 1994 and 2003 we delivered to our
shareholders more than 10% compound annual dividend growth.

Our offer to acquire Abbey is based on our belief that Abbey has a strong
franchise, with a leading position in the UK mortgage market and an extensive
distribution network. For our part, Santander will bring additional skills,
products and resources to Abbey, along with global experience and a track record
of achieving growth in a variety of markets and cultures. We believe that in
acquiring Abbey we will be preserving and strengthening an independent force in
the UK market for mortgage, banking and investment services.

Together Santander and Abbey have the opportunity to become a strong
pan-European player in retail banking.

A key part of this ambition will be the way we build on Abbey's existing
relationship with intermediaries. Around 50% of mortgages in the UK are sold
through intermediaries1 and in an independent survey 26% of intermediaries
believed that Abbey had the strongest presence in the UK mortgage market
(putting Abbey in joint first position)2. Abbey also has strong intermediary
market positions in both protection and wrap/investments. These figures
underline how important you will be to our future success as well as the
importance of an independent Abbey to the competitiveness of the UK mortgage and
other financial services markets.

Our aim is to drive forward business in all of our channels, maximising business
through Abbey's existing brand in the intermediary market, Abbey For
Intermediaries and increasing branch based business volumes. To help in this
effort we are committed to implementing substantial changes to the technology
environment within Abbey.

The IT platforms we are introducing in our different retail operations offer
significant advantages over many legacy systems. We believe that by bringing
these systems to Abbey, we can improve efficiency and customer service -
irrespective of whether the customer is a retail client or an intermediary. For
example, we have made significant gains in the time it takes us to process many
routine transactions. Our philosophy is to invest in customer facing areas
whilst extracting maximum efficiency from back office operations. We believe
this will make a real difference to Abbey and its competitive position in the UK
market. It should be noted that we have successfully implemented such technology
based efficiency programmes in other countries we operate in.

Of course, Abbey will remain a UK based bank, regulated by its existing
financial services regulators in the UK, and Santander looks forward to
leveraging the existing Abbey franchise.

It is important to note here that we call ourselves a 'Multi-local retail bank',
by which we mean that we adapt to local circumstances in the various countries
in which we operate. This is what we intend to do with Abbey in the UK. We are
fully aware of the competitive nature of the UK market for financial services
and we believe our acquisition of Abbey will strengthen competition for the
benefit of all.

We remain committed to completing our recommended acquisition of Abbey as soon
as possible once the necessary clearances and approvals are obtained. We expect
to obtain the necessary competition clearance from the European Commission on 17
September. We have no retail business or branches in the UK and therefore face
no competition issues in those regards.

We believe our proposed acquisition of Abbey provides value, certainty and
immediacy and as such we believe it will prove attractive to customers,
employees, shareholders and intermediaries alike.

I do hope this letter marks the beginning of a long-lasting and mutually
beneficial relationship.

My very best wishes.

Yours sincerely,


Juan Rodriguez Inciarte
Executive Vice President
Banco Santander Central Hispano, S.A.


* Based on an average exchange rate during 2003 of €1.44547: £1.00


Sources and bases of information:

1. The figure for the amount of mortgages in the UK sold through intermediaries 
   is derived from a Mintel Report dated April 2004 at page 50.

2. Intermediaries' views on Abbey's presence in the UK mortgage market are 
   derived from Datamonitor's Intermediary Survey dated December 2003 at 
   page 172.


The members of the Comision Ejecutiva (executive committee of the board of
directors) of Santander and Sr. D. Juan Rodriguez Inciarte and Sr. D. Francisco
Gomez Roldan, each being a senior executive of Santander, (together the
'Relevant Santander Persons') accept responsibility for the information
contained in this document, except that the only responsibility accepted by the
Relevant Santander Persons in respect of the information contained in this
document relating to Abbey, which has been compiled from published sources, is
to ensure that such information has been correctly and fairly reproduced and
presented. Subject as aforesaid, to the best of the knowledge and belief of the
Relevant Santander Persons (who have taken all reasonable care to ensure that
such is the case), the information contained in this document is in accordance
with the facts and does not omit anything likely to affect the import of such
information.'


Enquiries:

Banco Santander:
Keith Grant (Head of International Media)      [phone]
Peter Greiff (International Media Relations)   [phone]

The Maitland Consultancy:                      [phone]
Angus Maitland
Martin Leeburn
Philip Gawith

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