Banco Santander, the Spanish banking group, said today it has agreed with Skandinaviska Enskilda Banken (SEB Group) to buy SEB’s commercial banking business in Germany for around €555 million (around $700 million).

After the purchase is completed, the number of branches of Santander Consumer Bank’s network in Germany will be almost doubled, the firm said in a statement. The statement did not elaborate as to whether the deal involved the purchase of any wealth management or related banking activities in Germany.

In the statement, Santander said the acquisition “will have an impact of about 10 basis points” on Santander's core capital ratio, which stood at 8.8 per cent at the end of March this year.

The purchase is expected to be concluded in 2011, subject to regulatory approval.

Santander has been expanding its European footprint in recent years, such as through the purchase of UK lender and financial services group Abbey in 2004; it subsequently bought Bradford & Bingley, the mortgage lender that was pounded by the credit crunch, in 2008. The bank does operate a wealth management arm in the UK through its Santander Private Banking UK arm.