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Santander shares fall as bank cuts staff and lowers dividend amount

Santander SA (SANT) has cut staff by 2,500 as it cuts its revenue forecast for the next 12 months, and lowered its dividend to 7.25% as it seeks to reduce its $10.9 billion capital deficit.

The company’s share price fell 3.8% to $28.57 in after-hours trading.

S&P 500 index futures dropped 0.7%.

The bank has cut more than 9,000 jobs since mid-October.

Santander has been in talks with the US Department of Justice over a civil money laundering probe into the bank’s activities, which have been widely condemned by the US banking industry.

Santander said in a statement on Tuesday that the bank would no longer take “direct, active steps to support the financial stability of the Santander brand and the US financial system”.

The US Department in October accused Santander of violating sanctions imposed by the European Union, as well as the Bank of England, over the bank having provided financing to Iran, Hezbollah and other groups that have sought to overthrow the government in Tehran.

The bank said it will now focus on improving its compliance, asset quality and governance, while also reviewing its business model.

It said it expects to complete a review of the bank by the end of the year.