Spanish banking group Santander SA (SAN.MC) flagged a turning point for its struggling domestic business, shrugging off a slight fall in first quarter earnings.



"Revenues are growing at a good pace throughout the group and in Spain reversed the downward trend of recent quarters. I am convinced that this change will continue in the coming months," Chairman Emilio Botin said in a statement.

While analysts agreed that things looked better in Santander's home market, they said it would be a while before Spain is out of the woods. The country has been a focus of market attention since a property crash unleashed high personal debt levels and high unemployment.

Santander's profit in Spain, which accounts for less than Brazil or Britain at the geographically diversified bank, fell 31 percent year-on-year but rose by 54.3 percent quarter-on-quarter.

"These are basically solid results and I think this quarter will be the worst in terms of comparables because after the weakness of 2010, revenues will be more stable," said Arturo de Frias, analyst at Evolution Securities.

"Spain will start to look better in terms of profitability, but it will still be weak for a while," he added.

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