Edgar Filing: BANCO SANTANDER CHILE

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

Commission File Number: 001-14554

Banco Santander Chile

Santander Chile Bank

(Translation of Registrant’s Name into English)

Bandera 140

Santiago, Chile

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F

Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

Table of Contents

Item

1.	Third Quarter Earnings Report published on Oct. 29, 2008 (nominal terms)

2.	Results for the Nine-Month Period ended Sept. 30, 2008 (Spanish version, real terms)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BANCO SANTANDER-CHILE

	By:	/s/ Gonzalo Romero A.
	Name:	Gonzalo Romero A.
	Title:	General Counsel

Date: Nov. 13, 2008

INDEX

SECTION		PAGE

SECTION 1: SUMMARY OF RESULTS AND STRATEGY		2

SECTION 2: BALANCE SHEET		6

SECTION 3: ANALYSIS OF QUARTERLY INCOME STATEMENT		10

SECTION 4: CREDIT RISK RATINGS		18

SECTION 5: SHARE PERFORMANCE		19

SECTION 6: INSTITUTIONAL BACKGROUND		20

ANNEX 1: BALANCE SHEET		21

ANNEX 2: YTD INCOME STATEMENT		22

ANNEX 3: QUARTERLY INCOME STATEMENT		23

ANNEX 4: QUARTERLY EVOLUTION OF MAIN RATIOS AND OTHER INFORMATION		24

ANNEX 5: QUARTERLY EVOLUTION OF BALANCE SHEET		25

ANNEX 6: QUARTERLY EVOLUTION OF INCOME STATEMENT		26

CONTACT INFORMATION	Santiago, Chile
Robert Moreno	Tel: (562) 320-8284
Manager, Investor Relations Department	Fax: (562) 671-6554
Banco Santander Chile	Email: rmorenoh@santander.cl
Bandera 140 Piso 19,	Website: www.santander.cl

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SECTION 1: SUMMARY OF RESULTS AND STRATEGY

SOLID PROFITABILITY TRENDS

* Core revenues: Net interest income + fee income

** Net operating income: Core revenues + provision expense + operating expenses + market related income + other operating income, net

In 3Q08, net income attributable to shareholders totaled Ch$96,497 million (Ch$0.51 per share and US$0.96/ADR), increasing 23.0% QoQ and 13.3% YoY. As a consequence, ROAE in 3Q 2008 reached 28.6% compared to 23.2% in 2Q08 and 26.1% in 3Q07. We have the highest pre-tax return in the Chilean financial system.

Core revenues, that is, Net interest income plus fee income, increased 11.5% QoQ and 24.0% YoY. This strong operational results were partially offset by a larger loss from price level restatement and higher operating costs compared to 3Q07, which were negatively impacted by high inflation.

In our previous earnings report, we outlined our strategic objectives for the second half of 2008 and 2009. Results in 3Q 2008 were in line with these strategic objectives, which reflect our continued focus on expanding profitability through client-driven, plain vanilla banking activities, a conservative stance towards risk and high levels of efficiency. These 4 strategic objectives are also concurrent with today’s global financial crisis and its potential effects on the future growth rates of the Chilean economy.

1.	Proactive management of the balance sheet.

·	Selective loan growth with a focus on upper and middle income individuals and companies.

In 3Q08, total loans increased 4.3% QoQ and 18.4% YoY. Corporate lending increased 4.8% QoQ and 13.5% YoY and lending to the middle market increased 4.7% QoQ and 20.2% YoY. Lending to SMEs increased 4.5% QoQ and 20.1% YoY. The Bank’s solid liquidity position has helped to boost lending to corporations at attractive spreads. This is a trend we expect to continue through 2009.

Total loans to individuals increased 4.0% QoQ and 19.3% YoY. As mentioned in the previous quarter earnings report, loan growth to individuals has been centered in middle and upper income segments to improve the Bank’s loan book risk profile. Loans to upper income individuals increased 43.5% YoY and lending to lower income segments decreased 10.7% YoY in 3Q08.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

·	Focus on customer deposits, liquidity and maintaining strong capitalization ratios.

In 3Q08, inflation continued to exceed market expectations fuelling further rises in short-term interest rates. The Bank actively managed its funding base in the quarter in order to control funding costs. The Bank extended the maturity of its liabilities by issuing bonds in the market and avoided raising expensive short-term inflation indexed deposits. As of September 30, 2008, Santander Chile’s loan to deposit ratio reached 100.2% (excluding portion of mortgage loan funded through bonds and foreign trade loans funded through correspondent banks).

Capitalization ratios remained solid in 3Q08. During the quarter, the Bank issued, in the local market, US$117 million in subordinated bonds to further improve capitalization ratios. This bonds were priced at an attractive yield of 70bp over the 30 year Chilean Central Bank rate. As of September 30, 2008, the Bank’s BIS ratio reached a solid 13.1% with a core capital ratio of 9.7%.

·	Increasing spreads.

A key part of the Bank’s strategy since 2007 has been to focus on spreads in order to sustain profitability in a period of lower economic growth and to compensate for higher funding costs and provisioning levels. Loan spreads to companies have also been increasing as liquidity abroad has become scarcer and more expensive.

As a result of the Bank’s management of the asset and funding mix coupled with rising spreads and higher inflation, in 3Q08 net interest income was up 14.3% QoQ and 28.0% YoY. The Bank’s net interest margin reached a record level of 7.1% in 3Q08 compared to 6.2% in 2Q08 and 6.4% in 3Q07.

2.	Proactive management of risks to balance growth with an expected rise in risks.

As mentioned in previous earning reports, provisions continued to increase. Net provision expense increased 52.8% YoY in 3Q08. Including the sale of charged-off loans, which are recognized as a net gain from financial transactions, net provision expense increased 38.2% YoY in 3Q08. This rise was driven by the growth in retail banking activities, higher charge-offs in consumer loans due to the economic slowdown and high inflation levels seen in the last 12 months and an increase in risk in the middle-market segment following negligible levels in the past three years.

In 3Q08, the Bank continued to focus loan growth in lower risk segments in order to reduce the growth of provision expense. As a result, net provision expense on a sequential basis in 3Q08, grew 2.5% QoQ. Despite this rise in provision expense, in 3Q08 net interest income net of provision expenses increased 19.9% QoQ and 20.2% YoY, reflecting that the Bank’s higher spreads, higher inflation rates and the improved funding mix has more than offset the rise in risks.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

3.	Focus on increasing cross-selling and product usage to boost fees

Net fee income increased 0.3% QoQ and 8.8% YoY in 3Q08, in line with the expansion of cross-selling and product usage. Santander Chile has the largest client base (excluding the state owned bank) in Chile. The total number of clients increased 7.2% YoY to 3.0 million in 3Q08 and the amount of cross-sold clients increased 7.9% YoY in September 2008. In order to continue to expand our fee income base, the Bank is focusing on expanding cross-selling. Santander Chile has advanced IT systems that facilitates cross-selling and that provide commercial teams with easy to use tools for selling bank products.

4.	Tight control of costs. Focus on productivity gains and control of recurring costs. Maximize profitability of new branches.

In 3Q08, the efficiency ratio reached a solid 35.9% improving from 38.8% 2Q08 and 37.9% in 3Q07. Total operating expenses increased 4.1% QoQ and 16.9% YoY. Personnel expenses increased 4.0% QoQ and 18.0% YoY in 3Q08. The QoQ increase in personal expenses was mainly due to CPI adjustments to salaries as a result of the high inflation rates. The Bank’s average headcount increased 2.9% YoY and 0.9% QoQ.

The growth rate of administrative expenses was curbed in the quarter as the Bank has been limiting the opening of new branches in order to maximize the profitability of the existing network and to control costs. Administrative expenses increased 0.6% QoQ and 4.1% YoY in 3Q08. As of September 2008, the Bank’s distribution network totaled 472 offices, increasing 0.9% QoQ and 8.3% YoY. As of September 2008, the Bank had 1,987 ATMs, decreasing 1.4% QoQ and increasing 9.9% YoY. Since 1/3 of the Bank’s branches have been opened in the past three years, there is still room to sustain growth and improve efficiency by maximizing profitability of the newly opened offices. We have the highest level of efficiency among the larger banks in Chile and among the best in emerging markets.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

Banco Santander Chile: Summary of Results

	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (Reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Net interest income		253,221			221,451			197,891			28.0	%		14.3	%
Fee income		56,139			55,946			51,538			8.9	%		0.3	%
Core revenues		309,360			277,397			249,429			24.0	%		11.5	%
Financial transactions, net		33,933			22,019			23,757			42.8	%		54.1	%
Other operating income		(1,094	)		4,850			4,719			(123.2	)%		(122.6	)%
Total operating income		342,199			304,266			277,905			23.1	%		12.5	%
Operating expenses		(122,967	)		(118,112	)		(105,219	)		16.9	%		4.1	%
Provision expense		(72,128	)		(70,374	)		(47,197	)		52.8	%		2.5	%
Net operating income		147,104			115,780			125,489			17.2	%		27.1	%
Net income		96,457			79,573			86,085			12.0	%		21.2	%
Minority interest		(40	)		1,133			889			(104.5	)%		(103.5	)%
Net income attributable to shareholders		96,497			78,440			85,196			13.3	%		23.0	%
Net income/share (Ch$)		0.51			0.42			0.45			13.3	%		23.0	%
Net income/ADR (US$)¹		0.96			0.83			0.92			4.9	%		15.8	%
Total loans		13,791,128			13,216,808			11,645,812			18.4	%		4.3	%
Customer funds		14,074,217			14,619,427			12,738,673			10.5	%		(3.7	)%
Shareholders’ equity		1,500,504			1,373,196			1,367,475			9.7	%		9.3	%
Net interest margin		7.1	%		6.2	%		6.4	%
Efficiency ratio		35.9	%		38.8	%		37.9	%
Return on average equity³		28.6	%		23.2	%		26.1	%
PDL / Total loans		1.1	%		1.1	%		1.0	%
Coverage ratio of PDLs		181.0	%		173.2	%		197.2	%
Expected loss⁴		2.0	%		1.9	%		1.9	%
BIS ratio		13.1	%		12.9	%		12.5	%
Branches⁵		472			468			436
ATMs		1,997			2,016			1,808
Employees		9,331			9,230			9,057

1.	The change in earnings per ADR may differ from the change in earnings per share due to the exchange rate.

2.	Annualized Quarterly Earnings / Average Equity.

3.	Allowance for loan losses / Total loans.

4.	Includes SuperCaja and mini payment centers.

2007 figures have been re-categorized under the new format in order to make them more comparable, but the modification regarding minimum dividends has not been made to historical shareholders’ equity.

Please note that this information is provided for comparative purposes only and that this re-categorization of line items may undergo further changes during the year and, therefore, historical figures, including financial ratios, presented in this report may not be entirely comparable to future figures presented by the Bank. Re-classified historical figures have not been audited.

In this earnings report, 3Q07 and 2007 figures have suffered minor reclassifications between line items compared to figures for these periods presented in previous earnings reports. This affected mainly net gains from financial transactions, other operating income and other operating expenses.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

9M08 Results Summary

In the nine-month period ended September 30, 2008 (9M08), net income attributable to shareholders increased 5.3% YoY and totaled Ch$250,580 million (Ch$1.33/share and US$2.50/ADR). Growth was led by a 25.4% increase in core revenues. Net interest income increased 29.1% and fee income 12.5% YoY. The net interest margin in 9M08 reached a record level of 6.2% compared to 5.7% in 9M07. The efficiency ratio reached 37.8% in 9M08 compared to 37.7% in 9M07. Net operating income increased 12.3%. These higher operating results were partially offset by a 50.4% rise in non-operating losses, net which were negatively affected by higher losses from price level restatement. ROAE reached 24.2% in 9M08.

SECTION 2: BALANCE SHEET

LOANS

Selective loan growth with a focus on companies and upper and middle income individuals

Loans	Quarter ended,						% Change
(Ch$ million)	Sep-08		Jun-08		Sep-07 (reclassified)		Sept. 08 / 07			Sept. 08 / Jun 08
Total loans to individuals¹		6,654,210		6,397,456		5,576,602		19.3	%		4.0	%
Consumer loans		2,241,163		2,205,135		1,988,434		12.7	%		1.6	%
Residential mortgage loans		3,853,088		3,637,108		3,202,566		20.3	%		5.9	%
SMEs		2,418,645		2,314,975		2,013,521		20.1	%		4.5	%
Institutional lending		216,212		231,156		198,446		9.0	%		(6.5	)%
Middle-Market		2,831,381		2,703,058		2,355,899		20.2	%		4.7	%
Corporate		1,648,671		1,573,148		1,452,592		13.5	%		4.8	%
Total loans ^2,3		13,791,128		13,216,808		11,645,812		18.4	%		4.3	%

1	Includes consumer and mortgage lending and other loan products to individuals

2	Includes past due loans in each category.

3	Excludes allowance for loan losses and interbank loans

In 3Q08, total loans increased 4.3% QoQ and 18.4% YoY. Corporate lending increased 4.8% QoQ and 13.5% YoY and lending to the middle market increased 4.7% QoQ and 20.2% YoY. During the quarter, the Bank saw an increase in spreads (See Net interest income) in these segments as foreign sources of funding have become scarcer and more expensive. The Bank’s solid liquidity position has also help to boost lending to these low risk segments. Growth in corporate segments was also driven by the 6.2% depreciation of the peso against the US$ dollar in the quarter, which resulted in a translation gain in dollar denominated loans. This partially explains the 7.6% QoQ rise in foreign trade lending in the quarter.

Lending to SMEs increased 4.5% QoQ and 20.1% YoY. Commercial loans to this segment grew 4.9% QoQ and leasing 5.8% QoQ. Foreign trade loans rose 19.0% QoQ in this segment driven by translation gains.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

Total Commercial lending	Ch$mn		% Change Sept / June 08
Commercial loans		4,982,394		3.9	%
Foreign trade loans		1,105,549		7.6	%
Lines of credit to companies		275,591		16.6	%
Factoring		321,561		1.0	%
Leasing		946,584		0.7	%
Other commercial loans		65,199		13.6	%
Total commercial lending		7,696,878		4.4	%

As mentioned in the previous quarter earnings report, loan growth to individuals continued to be centered in middle and upper income segments. Total loans to individuals increased 4.0% QoQ and 19.3% YoY. Residential mortgage lending increased 5.9% QoQ and 20.3% YoY. Despite higher long-term rates, demand for residential mortgages remained healthy, especially among middle-upper income segments. The translation gain produced by the high inflation in the third quarter also boosted loan volumes in this product. Adjusted for inflation, residential mortgage lending increased 2.3% QoQ and 10.7% YoY. Consumer loans expanded 1.6% QoQ and 12.7% YoY. Loan growth was concentrated in middle to upper income segments. Lending to low income individuals decreased 10.3% YoY.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

FUNDING

Lengthening the maturity of liabilities

Customer funds	Quarter									Change %
(Ch$ million)	Sep-08			Jun-08			Sep-07 (reclassified)			Sept. 08 / 07			Sept. 08 / Jun 08
Non-interest bearing deposits		3,132,432			3,195,906			2,598,156			20.6	%		(2.0	)%
Time deposits		8,408,557			8,390,418			7,273,079			15.6	%		0.2	%
Total customer deposits		11,540,989			11,586,324			9,871,235			16.9	%		(0.4	)%
Mutual funds		2,533,228			3,033,103			2,867,438			(11.7	)%		(16.5	)%
Total customer funds		14,074,217			14,619,427			12,738,673			10.5	%		(3.7	)%
Senior bonds		1,536,539			1,507,574			980,497			56.7	%		1.9	%
Subordinated bonds		592,718			573,426			440,598			34.5	%		3.4	%
Quarterly inflation rate		3.63	%		2.17	%		2.98	%
Avg. overnight interbank rate (nominal)		7.58	%		6.39	%		5.45	%
Avg. 10 year Central Bank yield real)		3.39	%		3.06	%		3.08	%
Avg. 10 year Central Bank yield (nominal)		7.74	%		6.98	%		6.38	%

In 3Q08, inflation continued to exceed market expectations fuelling further rises in short-term interest rates. In the quarter the Bank actively managed its funding base in order to control funding costs, especially considering the Bank’s strong structural liquidity position. The Bank extended the maturity of its liabilities by issuing bonds in the market and avoided raising expensive short-term inflation indexed deposits. As a result, time deposits increased 0.2% QoQ and 15.6% YoY while senior bonds issued have increased 56.7% YoY and subordinated bonds 34.5% YoY.

The average balance of non-interest bearing checking accounts increased 0.7% QoQ and 18.9% YoY and the balance of non-interest bearing demand deposits decreased 2.0% QoQ and increased 20.6% YoY. The higher inflation rates in the quarter resulted in lower growth of this non-interesting bearing deposit.

As of September 30, 2008, Santander Chile’s loan to deposit ratio reached 100.2% (excluding portion of mortgage loan funded through bonds and foreign trade loans funded through correspondent banks).

Total foreign sources of funding, as of September 30, 2008, totaled Ch$1,463,040 million (US$ 2.6 billion) or 7.5% of total funding. US$239mn of this total matures in the fourth quarter. The Bank also holds ample liquidity in foreign currencies with overnight deposits in US$ dollars.

Assets under management decreased 16.5% QoQ and 11.7% YoY due to unfavorable market conditions, especially in equity markets that affected valuations.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL

Solid capitalization ratios. ROAE reached 28.6% in the third quarter and 24.2% in 9M08

Shareholders' Equity	Quarter									Change %
(Ch$ million)	Sep-08			Jun-08			Sep-07 (reclassified)			Sept. 08 / 07			Sept. 08 / Jun 08
Capital		818,535			818,535			761,853			7.4	%		0.0	%
Reserves		133,429			89,057			99,437			34.2	%		49.8	%
Unrealized gain (loss) Available-for-sale financial assets		(31,204	)		(45,900	)		(3,872	)		705.9	%		(32.0	)%
Retained Earnings:
Retained earnings previous periods		381,030			381,030			252,873			50.7	%		0.0	%
Net income		250,580			154,083			237,872			5.3	%		62.6	%
Provision for mandatory dividend		(75,174	)		(46,225	)		0
Minority Interest		23,308			22,616			19,312			20.7	%		3.1	%
Total Equity		1,500,504			1,373,196			1,367,475			9.7	%		9.3	%

*	By law banks must pay at least 30% of earnings and the Bank must now provision for this minimum mandatory dividend.

Shareholders’ equity totaled Ch$1,500,504 million (US$2.56 billion) as of September 30, 2008. ROAE in 3Q08 reached 28.6% compared to 26.1% in 3Q07 and 23.2% in 2Q08.

The Bank’s BIS ratio as of September 30, 2008 reached 13.1% with a Tier I ratio of 9.7%. During the quarter, the Bank issued US$117 million in subordinated bonds in the local market in order to extend the maturity of its funding base and to improve capitalization ratios. These bonds were issued at an attractive yield of 70bp over the 30 year Chilean Central Bank rate. This is in line with our strategic objectives of focusing on liquidity, funding and capital.

Capital Adequacy	Quarter ended									Change %
(Ch$ million)	Sep-08			Jun-08			Sep-07 (reclassified)			Sept. 08 / 07			Sept. 08 / Jun 08
Tier I		1,477,245			1,350,580			1,110,290			33.1	%		9.4	%
Tier II		514,005			461,436			440,432			16.7	%		11.4	%
Regulatory capital		1,991,250			1,812,016			1,550,722			28.4	%		9.9	%
Risk weighted assets		15,170,215			14,066,367			12,364,773			22.7	%		7.8	%
Tier I ratio		9.7	%		9.6	%		9.0	%
BIS ratio		13.1	%		12.9	%		12.5	%

*	Tier I includes year-to-date net income in 2008

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SECTION 3: ANALYSIS OF QUARTERLY INCOME STATEMENT

NET INTEREST INCOME

Positive evolution of NIM driven by improved asset/funding mix and higher inflation.

Net Interest Income / Margin	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Net interest income		253,221			221,451			197,891			28.0	%		14.3	%
Average interest-earning assets		14,365,245			14,252,583			12,343,716			16.4	%		0.8	%
Average loans		13,037,608			12,817,994			11,345,844			14.9	%		1.7	%
Net interest margin¹ (NIM)		7.1	%		6.2	%		6.4	%
Avg. equity + non-interest bearing demand deposits / Avg. interest earning assets		29.6	%		31.9	%		32.0	%
Quarterly inflation rate²		3.63	%		2.17	%		2.98	%
Avg. overnight interbank rate (nominal)		7.58	%		6.39	%		5.45	%
Avg. 10 year Central Bank yield (real)		3.39	%		3.06	%		3.08	%

1.	Annualized.

2.	Inflation measured as the variation of the Unidad de Fomento in the quarter.

In 3Q08, net interest income was up 28.0% YoY. Average earning assets increased 16.4% in the same period while the net interest margin – NIM - increased 70 basis points in the same period. Among the reasons for this improved NIM, it is worth mentioning:

Focus on spreads. A key part of the Bank’s strategy since 2007 has been to focus strongly on spreads in order to sustain profitability in a period of lower economic growth and to compensate for higher funding costs and provisioning levels. Loan spreads to companies have been increasing as liquidity abroad has become scarcer and more expensive. Deposit spreads have also benefited from the Bank’s higher credit risk ratings.

Inflation. The rise in margins is also due to higher inflation rates in 3Q08. The Bank maintains long-term assets (mainly medium and long-term financial investments and mortgage loans) that are denominated in Unidades de Fomento (UFs), and inflation indexed unit, which are partially funded with nominal or non-interest bearing peso short-term deposits. As the Bank maintains a positive gap between assets and liabilities indexed to inflation, a rise in inflation has a positive effect on net interest income and margins. This is partially offset by the loss from price level restatement and higher operating costs which are for the most part indexed to inflation.

Net interest income in 3Q08 increased 14.3% QoQ and the NIM increased 90bp. This QoQ rise in margins was mainly due to the higher quarterly inflation rates and a higher spread earned on deposits. This was partially offset by a lower loan spreads that was negatively affected by a shift in the loan mix to lower yielding loan products.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

Going forward margins could begin to descend as inflation moderates, funding costs rises and the asset mix shifts towards lower yielding and less risky loans. As mentioned above, this is being confronted by increasing spreads and actively managing the asset and liability mix.

PROVISION FOR LOAN LOSSES

Net provision expense and asset quality stable on a QoQ basis

Provision for loan losses	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Gross provisions		(13,055	)		(12,824	)		(10,055	)		29.8	%		1.8	%
Charge-offs		(68,325	)		(66,250	)		(49,465	)		38.1	%		3.1	%
Gross provisions and charge-offs		(81,380	)		(79,074	)		(59,520	)		36.7	%		2.9	%
Loan loss recoveries		9,252			8,700			12,323			(24.9	)%		6.3	%
Net provisions for loan losses		(72,128	)		(70,374	)		(47,197	)		52.8	%		2.5	%
Total loans		13,791,128			13,216,808			11,645,812			18.4	%		4.3	%
Total reserves (RLL)		(269,167	)		(256,183	)		(221,070	)		21.8	%		5.1	%
Past due loans* (PDL)		148,709			147,874			112,130			32.6	%		0.6	%
Gross provision expense / Loans		2.36	%		2.39	%		2.04	%
Cost of credit**		2.09	%		2.13	%		1.62	%
PDL / Total loans		1.08	%		1.12	%		0.96	%
Expected loss (RLL / Total loans)		1.95	%		1.94	%		1.90	%
Coverage of past due loans***		181.0	%		173.2	%		197.2	%

*	Past due loans: installments or credit lines more than 90 days overdue.

**	Net provision expense / loans annualized.

***	RLL / Past due loans.

In 3Q08, the Bank’s net provision expense increased 2.5% QoQ and 52.8% YoY. Including the sale of charged-off loans, which are recognized as a net gain from financial transactions, net provision expense increased 38.2% YoY in 3Q08. As mentioned in previous earning reports, this rise was driven by the growth in retail banking activities, higher charge-offs in consumer loans due to the economic slowdown and high inflation levels seen in the last 12 months and an increase in risk in the middle-market segment following negligible levels in the past three years.

Net provisions for loan losses by segment	Quarter							Change %
(Ch$ million)	3Q08		2Q08		3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Retail banking*		67,089		64,068		48,211			39.2	%		4.7	%
Middle-market		4,799		6,308		265			1710.9	%		(23.9	)%
Corporate banking		65		123		(126	)		—	%		(47.2	)%
Total net provisions for loan losses**		71,953		70,499		48,350			48.8	%		2.1	%

*	Includes individuals, institutional lending and SMEs.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

The increase in net provision expense in 3Q08 was also due to the 24.9% YoY reduction in loan loss recoveries. The collection departments is now focused on increasing the rate of recoverability in the first six months of non-performance as efforts to collect after this period tend to be less cost efficient. After this period, the Bank tries to sell these charged-off loans and any gain will be recognized as a gain in financial transactions, net. In 3Q08, the Bank realized a gain of Ch$6,902 million from the sale of charged-off loans that is recognized in financial transactions, net.

In 3Q08, the Bank continued to focus loan growth in lower risk segments in order to reduce the growth of this expense. Spreads have also been increased to cover for this higher requirement. As a result of these measures, net interest income after net provision expense increased 20.2% YoY in 3Q08 and 26.9% year-to-date in September compared to the nine-month period ended September 30, 2007 reflecting that the Bank has up to now been able to offset the rise in risks.

The past due loan ratio (Past due installment >90 days / Total loans) as of September 2008 reached 1.08% compared to 1.12% in 2Q08 and 0.96% in 3Q07. Coverage of past due loans (Loan loss allowance / Past due loans) reached 181.0% as of September 2008 compared to 173.2% at June 2008 and 197.2% at September 2007.

The expected loan loss ratio (Loan loss allowances / Total loans), which is a ratio that measures how much of the Bank’s loan portfolio is at risk, remained steady QoQ and YoY at 1.95% due to the Bank’s conservative charge-off policies. The cost of credit (Net provision expense / Total loans, annualized) reached 2.09%, steady QoQ and up from 1.62% in 3Q07. Going forward, the expected loan loss ratio and the cost of credit should rise given the expected lower economic growth.

IFRS note: In 2009, and in line with IFRS standards being adopted by Chilean banks, non-performing loans will include the entire balance of loans, including the performing portions. As a result, the PDL ratio will be more in line with the expected loan loss levels.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

NET FEE INCOME

Focus on cross-selling

Fee Income	Quarter						Change %
(Ch$ million)	3Q08		2Q08		3Q07 (reclassified)		3Q08 / 3Q07			3Q / 2Q 08
Checking accounts & lines of credit		15,865		15,468		17,037		(6.9	)%		2.6	%
Collection fees		10,915		10,265		8,259		32.2	%		6.3	%
Credit, debit & ATM card fees		10,326		10,524		9,024		14.4	%		(1.9	)%
Asset management		7,622		7,592		8,238		(7.5	)%		0.4	%
Guarantees, pledges and other contingent operations		4,237		3,960		3,599		17.7	%		7.0	%
Insurance brokerage		3,880		4,286		3,032		28.0	%		(9.5	)%
Fees from brokerage and custody of securities		1,953		2,115		1,662		17.5	%		(7.7	)%
Other Fees		1,343		1,736		688		95.3	%		(22.6	)%
Total fees		56,139		55,946		51,538		8.9	%		0.3	%

Net fee income increased 0.3% QoQ and 8.9% YoY in 3Q08 in line with the expansion of cross-selling and product usage. Santander Chile has the largest client base (excluding the state owned bank) in Chile. The total number of clients increased 7.2% YoY to 3.0 million in 3Q08 and the amount of cross-sold clients increased 7.9% YoY in September 2008. Despite this improvement, only 30% of our clients have 2 or more products, reflecting the high cross-selling potential of the Bank’s client base. Going forward the Bank is focusing on expanding cross-selling over increasing the total client base as a way to grow efficiently and in order to keep risks under control.

Fees from checking accounts and lines of credit decreased 6.9% YoY. Going forward and, especially in 2009, fee income from lines of credit will be hampered by regulatory changes that will limit amounts charged for un-authorized overdrafts. The Bank has proactively closed some checking accounts due to credit risk reasons.

Fees from credit, debit and ATM cards increased 14.4% YoY. The usage of electronic means of payments continues to steadily grow in Chile as bank penetration and cross-selling ratios improve. Fees from credit, debit and ATM cards decreased 1.9% QoQ. The Bank has proactively eliminated some credit card amounts due to credit risk reasons.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

Collection fees increased 6.3% QoQ and 32.2% YoY. The main driver of fee growth in this line item is the collection of loan insurance policies on behalf of third parties which evolves with overall commercial activity.

Asset management fees were flat QoQ and decreased 7.5% YoY. Assets under management decreased 16.5% QoQ and 11.7% YoY due to unfavorable market conditions, especially in equity markets that affected valuations and asset management fees.

Fees from guarantees, pledges and other contingent operations increased 7.0% QoQ and 17.7% YoY, in line with higher commercial activity in corporate segments.

Insurance brokerage fees decreased 9.5% QoQ and increased 28.0% YoY in 3Q08. The Bank’s strength in cross-selling the client base by offering attractive insurance products through the Internet has been a key driver in this line item. The QoQ decline is mainly due to seasonal factors and a slowdown of business volumes in line with decelerating economic growth.

Fees securities brokerage and custody decreased 7.7% QoQ and increased 17.3% YoY. The YoY rise in securities brokerage was mainly due to an increase in cross-selling of brokerage services to retail clients, an increase in traded volumes with institutional investors and more foreign investment activity in our local stock brokerage. The QoQ decline was mainly due to the weak evolution of equity markets in the quarter.

OPERATING EXPENSES AND EFFICIENCY

The efficiency ratio improves to 35.9% in the quarter. The Bank continues to tighten cost control

Operating Expenses	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Personnel expenses		(53,889	)		(51,800	)		(45,686	)		18.0	%		4.0	%
Administrative expenses		(42,238	)		(41,969	)		(40,566	)		4.1	%		0.6	%
Depreciation and amortization		(14,038	)		(13,078	)		(11,000	)		27.6	%		7.3	%
Other operating expenses		(12,802	)		(11,265	)		(7,967	)		60.7	%		13.6	%
Operating expenses		(122,967	)		(118,112	)		(105,219	)		16.9	%		4.1	%
Efficiency ratio*		35.9	%		38.8	%		37.9	%

*	Operating expenses / Operating income. Operating income = Net interest income + Net fee income+ Market related income + Other operating income.

In 3Q08, the efficiency ratio reached 35.9%, improving from 38.8% 2Q08 and 37.9% in 3Q07. Total operating expenses increased 4.1% QoQ and 16.9% YoY. Personnel expenses increased 4.0% QoQ and 18.0% YoY in 3Q08. The QoQ increase in personnel expenses was mainly due to CPI adjustments to salaries as a result of the high inflation rates. The wage increase was approximately 4% in July following a 4% rise in April and a 4% rise in 3Q07. The Bank’s average headcount increased 2.9% YoY and 0.9% QoQ. Going forward and depending on the evolution of inflation, we expect a further moderation in the growth rate of headcount and personnel expenses.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

The growth rate of administrative expenses was curbed in the quarter as the Bank has been limiting the opening of new branches in order to maximize the profitability of the existing network and to control costs. Administrative expenses in 3Q08 increased 0.6% QoQ and 4.1% YoY. As of September 2008, the Bank’s distribution network totaled 472 offices, increasing 0.9% QoQ and 8.3% YoY. As of September 2008, the Bank had 1,987 ATMs, decreasing 1.4% QoQ and increasing 9.9% YoY. Since 1/3 of the Bank’s branches have been opened in the past three years, there is still ample room to sustain growth and improve efficiency by maximizing profitability of the newly opened offices.

The 7.3% QoQ and 27.6% YoY increase in depreciation and amortization expenses is also directly related to the growth of the Bank’s distribution network.

Other operating expenses are mainly expense primarily relating to the Bank’s call center, credit card related expenses, expenses related to repossessed assets and provisions for non-credit contingencies. The increase in other operating expenses was mainly driven by higher provisions for non-credit contingencies in 3Q08 compared to 3Q07.

OTHER OPERATING INCOME AND GAINS (LOSSES) ON FINANCIAL TRANSACTIONS

Positive results from client related activities

Other Operating Income and Net Result from Financial Transactions	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Other operating income		(1,094	)		4,850			6,083			—	%		—	%
Net gains from mark-to-market and trading		96,512			163,192			(4,342	)		—	%		(40.9	)%
Exchange differences, net		(62,579	)		(141,173	)		28,099			—	%		(55.7	)%
Net result from financial transactions		33,933			22,019			23,757			42.8	%		54.1	%

Other operating income, which mainly includes the results from the sale and maintenance of repossessed assets and other results, totaled a loss of Ch$1,094 million in 3Q08. The quarterly QoQ and YoY decline was mainly due to higher non-credit provisions recognized in 3Q08 and reclassification of items between other operating income and operating expenses in the quarter.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

Net gains from financial transactions totaled a gain of Ch$33,933 million in 3Q08 and increased 54.1% QoQ and 42.8% YoY. The net gains from mark-to-market and trading mainly includes the mark-to-market of financial investments held for trading, the interest revenue generated by this portfolio, any gain or loss from the sale of charged-off loans and the mark-to-market of derivatives. The results recorded as exchange differences, net mainly includes the translation gains or losses of assets and a liability denominated in foreign currency, but does not include the mark-to-market of FX derivatives. As Santander Chile limits its foreign exchange gap, the results that are recorded in foreign exchange transactions are, for the most part, offset by the mark-to-market of foreign currency forwards that are included in the net gains from mark-to-market and trading. In order to better understand this line item, we explain the net results from financial transactions by business area in the table below.

Net Result from Financial Transactions	Quarter								Change %
(Ch$ million)	3Q08		2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Client revenues*		30,649		26,687			25,253			21.4	%		14.8	%
ALCO, Proprietary trading & other results		3,285		(4,668	)		(1,496	)		—	%		—	%
Net Result from Financial Transactions		33,933		22,019			23,757			42.8	%		54.1	%

*	Santander Global Connect, market making & results from the sale of charged-off loans

The 14.8% QoQ and 21.4% YoY increase in client revenues in our Treasury was mainly due to a Ch$6,902 million gains from the sale of charged-off loans in the quarter. The net results from proprietary trading and ALCO totaled Ch$3,285 million in 3Q08 compared to a loss in 2Q08 and 3Q07. This was mainly due to higher gains from prop-trading partially offset by the hedging costs of the Bank’s structural liquidity position in US$. Our ALCO has followed a conservative policy regarding liquidity, since the onset of the sub-prime crisis in mid-2007, by increasing the Bank’s structural liquidity in pesos and US$. This liquidity position has become a competitive advantage for the Bank in a moment in which funding has become more expensive in local and international markets.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

NON-OPERATING ITEMS

Other Income and Expenses	Quarter									Change %
(Ch$ million)	3Q08			2Q08			3Q07 (reclassified)			3Q08 / 3Q07			3Q / 2Q 08
Income attributable to investments in other companies		139			1,180			(635	)		—	%		(88.2	)%
Price level restatement		(31,157	)		(22,546	)		(23,902	)		30.4	%		38.2	%
Income tax		(19,629	)		(14,841	)		(14,867	)		32.0	%		32.3	%

Price level restatement in the quarter totaled a loss of Ch$31,157 million. The difference in inflation rates explains the variation in price level restatement. The Bank must adjust its capital and fixed assets for the variations in price levels. When inflation is positive, the Bank records a loss from price restatement, since the Bank's capital is larger than fixed assets. The inflation rate was 3.63% in 3Q08 compared to 2.17% in 2Q08 and 2.98% in 3Q07.

IFRS note: In 2009, price level restatement will no longer be recognized. Capital will no longer be restated to reflect changes in CPI and fixed and other non-financial assets will not be adjusted for variation of the UF. 2008 balances sheet and income statement will be restated to account for this effect.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SECTION 4: CREDIT RISK RATINGS

International ratings:

The Bank has credit ratings from three leading international agencies. We have the highest risk rating in Latin America.

Moody’s		Rating
Long-term bank deposits		A2
Senior bonds		Aa3
Subordinated debt		Aa3
Bank Deposits in Local Currency		Aa2
Bank financial strength		B-
Short-term deposits		P-1

Standard and Poor’s		Rating
Long-term Foreign Issuer Credit		A+
Long-term Local Issuer Credit		A+
Short-term Foreign Issuer Credit		A-1
Short-term Local Issuer Credit		A-1

Fitch		Rating
Foreign Currency Long-term Debt		A+
Local Currency Long-term Debt		A+
Foreign Currency Short-term Debt		F1
Local Currency Short-term Debt		F1
Individual rating		B

Local ratings:

Our local ratings, the highest in Chile, are the following:

Local ratings	Fitch Ratings	Feller Rate
Shares	Level 2	1CN1
Short-term deposits	N1+	Level 1+
Long-term deposits	AAA	AAA
Mortgage finance bonds	AAA	AAA
Senior bonds	AAA	AAA
Subordinated bonds	AA+	AA+
Outlook	Stable	Stable

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SECTION 5: SHARE PERFORMANCE

As of September 2008

Ownership Structure:

ADR Price Evolution

Santander ADR vs. Global 1200 Financial Index

(Base 100 = 12/31/2003)

ADR price (US$) 2008

Year-end 2007:			50.99
Maximum (2008):			54.60
Minimum (2008):			37.10
Close (09/30/08):			42.79

Market Capitalization: US$7,761 million

P/E 12 month trailing:	11.8
P/BV (24/10/08):	2.54
Dividend yield*:	4.5	%

*	Based on closing price on record date of last dividend payment.

Daily traded volumes 3Q 2008

Local Share Price Evolution

Santander vs IPSA Index

(Base 100 = 12/31/2003)

Local share price (Ch$) 2008

Year-end 2007:			24.49
Maximum (2008):			24.86
Minimum (2008):			19.30
Close (09/30/08):			21.92

Dividends:

			% of previous year
Year paid	Ch$/share		earnings
2005:		1.05		100	%
2006:		0.83		65	%
2007:		0.99		65	%
2008:		1.06		65	%

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

SECTION 6: INSTITUTIONAL BACKGROUND

Institutional Background

As per the latest public records published by the Superintendency of Banks of Chile for September 2008, Banco Santander Chile was the largest bank in terms of loans and deposits. The Bank has the highest credit ratings among all Latin American companies, with an A+ rating from Standard and Poor’s, A+ by Fitch and A2 by Moody’s, which are the same ratings assigned to the Republic of Chile. The stock is traded on the New York Stock Exchange (NYSE: SAN) and the Santiago Stock Exchange (SSE: Bsantander). The Bank’s main shareholder is Santander, which controls 76.91% of Banco Santander Chile.

Banco Santander (SAN.MC, STD.N) is the largest bank in the euro zone and seventh in the world by market capitalization. Santander engages primarily in commercial banking with complementary activities in global wholesale banking, cards, asset management and insurance. Founded in 1857, Santander has as of June 2008, EUR 918,332 million in assets and EUR 1,050,928 million in managed funds, more than 65 million customers, 11,216 branches and a presence in some 40 countries. It is the largest financial group in Spain and Latin America. Through its Abbey subsidiary, Santander is the sixth largest bank in the United Kingdom, and is the third largest banking group in Portugal. Through Santander Consumer Finance, it also operates a leading franchise in 20 countries, with its principal focus in Europe (Germany, Italy and Spain, among others) and the U.S. In the first half of 2008, Santander registered EUR 4,730 million in net attributable profit, an increase of 22% from the previous year, excluding capital gains. For more information, see www.santander.com.

In Latin America (excluding Banco Real), Santander manages over US$200 billion in business volumes (loans, deposits, mutual funds, pension funds and managed funds) through 4,528 branches. In the first half of 2008 (excluding Banco Real), Santander reported US$2,171 million in net attributable income in Latin America, up 20% from the same period of 2007.

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 1: BALANCE SHEET

Unaudited Balance Sheet	Sep-08			Sep-08			Jun-08			Sep-07			Sept. 2008 / 2007			Sept. / June 2008
	US$ths												% Chg.
										(Reclassified)
Assets
Cash and balances from Central Bank		1,545,961			854,097			1,280,337			717,875			19.0	%		(33.3	)%
Funds to be cleared		930,083			513,843			487,591			339,009			51.6	%		5.4	%
Financial assets held for trading		1,612,884			891,070			893,938			879,302			1.3	%		(0.3	)%
Investment collateral under agreements to repurchase		15,938			8,805			11,697			39,192			(77.5	)%		(24.7	)%
Derivatives		2,346,556			1,296,402			1,233,562			585,000			121.6	%		5.1	%
Interbank loans		137,591			76,015			150,406			182,051			(58.2	)%		(49.5	)%
Loans, net of reserves for loan losses		24,475,468			13,521,962			12,960,626			11,424,742			18.4	%		4.3	%
Available-for-sale financial assets		2,383,371			1,316,741			1,080,216			807,492			63.1	%		21.9	%
Held-to-maturity investments		-			-			-			-
Investments in other companies		13,007			7,186			6,865			5,847			22.9	%		4.7	%
Intangible assets		125,860			69,534			61,458			52,883			31.5	%		13.1	%
Fixed assets		459,605			253,918			248,906			237,602			6.9	%		2.0	%
Current tax assets		22,218			12,275			17,824			1,451			746.0	%		(31.1	)%
Deferred tax assets		184,401			101,876			62,721			59,325			71.7	%		62.4	%
Other assets		1,209,648			668,294			593,297			428,116			56.1	%		12.6	%
Total Assets		35,462,592			19,592,018			19,089,444			15,759,887			24.3	%		2.6	%

Liabilities and Equity
Total non-interest bearing deposits		5,669,868			3,132,432			3,195,906			2,598,156			20.6	%		(2.0	)%
Funds to be cleared		558,121			308,345			297,611			194,630			58.4	%		3.6	%
Investments sold under agreements to repurchase		1,341,327			741,043			295,494			392,388			88.9	%		150.8	%
Time deposits and savings accounts		15,219,934			8,408,557			8,390,418			7,273,079			15.6	%		0.2	%
Derivatives		2,031,928			1,122,579			1,081,784			568,580			97.4	%		3.8	%
Deposits from credit institutions		2,707,126			1,495,606			1,505,176			1,192,736			25.4	%		(0.6	)%
Marketable debt securities		4,294,150			2,372,389			2,405,006			1,891,697			25.4	%		(1.4	)%
Other obligations		184,622			101,998			138,185			118,870			(14.2	)%		(26.2	)%
Current tax liabilities		766			423			797			28,666			(98.5	)%		(46.9	)%
Deferred tax liability		102,978			56,892			23,549			4,271			1232.1	%		141.6	%
Provisions		239,318			132,216			88,971			41,278			220.3	%		48.6	%
Other liabilities		396,463			219,034			293,351			88,061			148.7	%		(25.3	)%
Total Liabilities		32,746,600			18,091,514			17,716,248			14,392,412			25.7	%		2.1	%

Equity
Capital		1,481,592			818,535			818,535			761,853			7.4	%		0.0	%
Reserves		241,514			133,429			89,057			99,437			34.2	%		49.8	%
Unrealized gain (loss) Available-for-sale financial assets		(56,481	)		(31,204	)		(45,900	)		(3,872	)		705.9	%		(32.0	)%
Retained Earnings:		0			0			0			-
Retained earnings previous periods		689,685			381,030			381,030			252,873			50.7	%		0.0	%
Net income		453,563			250,580			154,083			237,872			5.3	%		62.6	%
Provision for mandatory dividend		(136,069	)		(75,174	)		(46,225	)		0						62.6	%
Minority Interest		42,189			23,308			22,616			19,312			20.7	%		3.1	%
Total Equity		2,715,992			1,500,504			1,373,196			1,367,475			9.7	%		9.3	%
Total Liabilities and Equity		35,462,590			19,592,018			19,089,444			15,759,887			24.3	%		2.6	%

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 2 : YTD INCOME STATEMENT

YTD Income Statement Unaudited	Sep-08			Sep-08			Sep-07			Sept. 2008 / 2007
	US$ths.			Ch$ million nominal						% Chg.
							(reclassified)
Interest revenue		2,752,599			1,520,728			1,119,110			35.9	%
Interest expense		(1,551,473	)		(857,142	)		(605,090	)		41.7	%
Net interest revenue		1,201,125			663,586			514,021			29.1	%
Fee income		369,093			203,913			179,143			13.8	%
Fee expense		(69,223	)		(38,244	)		(31,888	)		19.9	%
Net fee income		299,870			165,669			147,254			12.5	%
Net gains from mark-to-market and trading		309,539			171,011			75,294			127.1	%
Exchange differences, net		(184,211	)		(101,771	)		16,265			(725.7	)%
Financial transactions, net		125,328			69,240			91,558			(24.4	)%
Other operating income		23,898			13,203			10,730			23.0	%
Total operating income		1,650,221			911,698			763,563			19.4	%
Personnel expenses		(271,558	)		(150,028	)		(125,945	)		19.1	%
Administrative expenses		(222,464	)		(122,905	)		(112,762	)		9.0	%
Depreciation and amortization		(69,851	)		(38,590	)		(30,407	)		26.9	%
Other operating expenses		(59,661	)		(32,961	)		(19,016	)		73.3	%
Total operating expenses		(623,533	)		(344,483	)		(288,131	)		19.6	%
Provision expense		(368,220	)		(203,431	)		(151,537	)		34.2	%
Net operating income		658,468			363,784			323,896			12.3	%
Income attributable to investments in other companies		1,913			1,057			(1,229	)		(186.0	)%
Price level restatement		(113,266	)		(62,576	)		(39,684	)		57.7	%
Net income before taxes		547,115			302,265			282,983			6.8	%
Income tax		(89,981	)		(49,712	)		(43,400	)		14.5	%
Net income from ordinary activities		457,134			252,553			239,583			5.4	%
Net income discontinued operations		0			0			0
Net income attributable to:
Minority interest		3,570			1,972			1,711			15.3	%
Net income attributable to shareholders		453,564			250,580			237,872			5.3	%

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 3 : QUARTERLY INCOME STATEMENT

Unaudited Quarterly Income Statement	3Q08			3Q08			2Q08			3Q07			3Q08 / 3Q07			3Q / 2Q 08
	US$ths.									(Reclassified)			% Chg.
Interest revenue		1,129,873			624,221			498,564			477,765			30.7	%		25.2	%
Interest expense		(671,530	)		(371,000	)		(277,113	)		(279,874	)		32.6	%		33.9	%
Net interest revenue		458,343			253,221			221,451			197,891			28.0	%		14.3	%
Fee income		125,851			69,529			68,727			62,606			11.1	%		1.2	%
Fee expense		(24,237	)		(13,390	)		(12,781	)		(11,068	)		21.0	%		4.8	%
Net fee income		101,615			56,139			55,946			51,538			8.9	%		0.3	%
Net gains from mark-to-market and trading		174,692			96,512			163,192			(4,342	)		—	%		(40.9	)%
Exchange differences, net		(113,271	)		(62,579	)		(141,173	)		28,099			—	%		(55.7	)%
Total market related income		61,421			33,933			22,019			23,757			42.8	%		54.1	%
Other operating income		(1,980	)		(1,094	)		4,850			4,719			—	%		-	%
Total operating income		619,398			342,199			304,266			277,905			23.1	%		12.5	%
Personnel expenses		(97,542	)		(53,889	)		(51,800	)		(45,686	)		18.0	%		4.0	%
Administrative expenses		(76,453	)		(42,238	)		(41,969	)		(40,566	)		4.1	%		0.6	%
Depreciation and amortization		(25,410	)		(14,038	)		(13,078	)		(11,000	)		27.6	%		7.3	%
Other operating expenses		(23,172	)		(12,802	)		(11,265	)		(7,967	)		60.7	%		13.6	%
Total operating expenses		(222,577	)		(122,967	)		(118,112	)		(105,219	)		16.9	%		4.1	%
Provision expense		(130,556	)		(72,128	)		(70,374	)		(47,197	)		52.8	%		2.5	%
Net operating income		266,266			147,104			115,780			125,489			17.2	%		27.1	%
Income attributable to investments in other companies		252			139			1,180			(635	)		(121.9	)%		(88.2	)%
Price level restatement		(56,396	)		(31,157	)		(22,546	)		(23,902	)		30.4	%		38.2	%
Net income before taxes		210,122			116,086			94,414			100,952			15.0	%		23.0	%
Income tax		(35,530	)		(19,629	)		(14,841	)		(14,867	)		32.0	%		32.3	%
Net income from ordinary activities		174,592			96,457			79,573			86,085			12.0	%		21.2	%
Net income discontinued operations		0			0			0			0
Net income attributable to:
Minority interest		(72	)		(40	)		1,133			889			(104.5	)%		(103.5	)%
Net income attributable to shareholders		174,665			96,497			78,440			85,196			13.3	%		23.0	%

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 4 : QUARTERLY EVOLUTION OF MAIN RATIOS AND OTHER INFORMATION

Annex	Mar-07			Jun-07			Sep-07			Dec-07			Mar-08			Jun-08			Sep-08
(Ch$ millions)	(Reclassified)			(Reclassified)			(Reclassified)			(Reclassified)
Loans
Consumer loans		1,911,570			1,931,833			1,988,434			2,082,579			2,158,563			2,205,135			2,241,163
Residential mortgage loans		2,947,857			3,068,067			3,202,566			3,345,493			3,454,383			3,637,108			3,853,088
Commercial loans		6,193,586			6,098,230			6,454,812			6,830,385			6,822,116			7,374,565			7,696,877
Total loans		11,053,013			11,098,130			11,645,812			12,258,457			12,435,062			13,216,808			13,791,128
Allowance for loan losses		(200,011	)		(211,112	)		(221,070	)		(232,766	)		(243,982	)		(256,183	)		(269,167	)
Total loans, net of allowances		10,853,002			10,887,018			11,424,742			12,025,691			12,191,080			12,960,625			13,521,961

Loans by segment
Individuals		5,214,822			5,376,224			5,576,602			5,846,856			6,051,080			6,397,456			6,654,210
SMEs		1,864,258			1,905,480			2,013,521			2,126,067			2,200,282			2,314,975			2,418,645
Institutional lending		192,168			191,410			198,446			210,357			218,446			231,156			216,212
Total retail lending		7,271,248			7,473,114			7,788,569			8,183,281			8,469,808			8,943,587			9,289,066
Middle-Market & Real estate		2,348,975			2,302,678			2,355,899			2,470,934			2,516,708			2,703,058			2,831,381
Corporate		1,376,704			1,275,726			1,452,592			1,628,192			1,500,669			1,573,148			1,648,671

Customer funds
Demand deposits		2,491,571			2,591,979			2,598,156			2,868,769			2,773,548			3,195,906			3,132,432
Time deposits		7,281,003			7,343,085			7,273,079			7,887,897			8,407,623			8,390,418			8,408,557
Total deposits		9,772,574			9,935,064			9,871,235			10,756,666			11,181,171			11,586,324			11,540,989
Mutual funds (Off balance sheet)		2,283,807			2,577,630			2,867,438			2,634,461			2,670,163			3,033,103			2,533,228
Total customer funds		12,056,381			12,512,694			12,738,673			13,391,127			13,851,334			14,619,427			14,074,217

Average balances
Avg. interest earning assets		11,590,544			11,931,595			12,343,716			12,840,100			13,547,248			14,252,583			14,365,245
Avg. loans		10,965,469			11,121,879			11,345,844			11,908,379			12,285,523			12,817,994			13,037,608
Avg. assets		14,159,366			14,749,993			15,384,017			16,368,066			17,590,786			15,303,413			14,365,245
Avg. demand deposits		2,495,549			2,601,858			2,558,412			2,659,506			2,807,769			3,020,504			3,041,640
Avg equity		1,287,034			1,246,390			1,305,862			1,420,607			1,397,778			1,353,730			1,351,109
Avg. free funds		3,808,756			3,820,031			3,946,319			4,306,811			4,171,730			4,546,486			4,245,790

Capitalization
Risk weighted assets		11,741,425			11,851,230			12,364,773			13,087,642			13,593,098			14,066,367			15,170,215
Tier I		1,244,996			1,075,377			1,110,290			1,129,395			1,398,183			1,350,580			1,477,245
Tier II		470,099			467,469			440,432			473,037			415,905			461,436			514,005
Regulatory capital		1,715,095			1,542,846			1,550,722			1,602,432			1,814,088			1,812,016			1,991,250
BIS ratio		14.6	%		13.0	%		12.5	%		12.2	%		13.3	%		12.9	%		13.1	%

Profitability & Efficiency
Net interest margin		4.9	%		5.8	%		6.4	%		6.2	%		5.6	%		6.2	%		7.1	%
Efficiency ratio		37.1	%		38.2	%		37.9	%		41.9	%		39.0	%		38.8	%		35.9	%
Avg. Free funds / interest earning assets		32.9	%		32.0	%		32.0	%		33.5	%		30.8	%		31.9	%		29.6	%
Return on avg. equity		22.4	%		25.8	%		26.1	%		19.9	%		21.6	%		23.2	%		28.6	%
Return on avg. assets		2.0	%		2.2	%		2.2	%		1.7	%		1.7	%		2.1	%		2.7	%

Asset quality
Past due loans		97,937			105,668			112,130			116,654			135,354			147,874			148,709
PDL / total loans		0.89	%		0.95	%		0.96	%		0.95	%		1.09	%		1.12	%		1.08	%
Coverage ratio		204.2	%		199.8	%		197.2	%		199.5	%		180.3	%		173.2	%		181.0	%
Expected loss (Loan loss allowances / Loans)		1.81	%		1.90	%		1.90	%		1.90	%		1.96	%		1.94	%		1.95	%
Cost of credit (prov. expense / loans)		2.15	%		1.62	%		1.62	%		1.79	%		1.96	%		2.13	%		2.09	%

Network
Branches		422			428			436			464			466			468			472
ATMs		1,635			1,744			1,808			2,004			1,989			2,016			1,997
Employees		8,691			8,913			9,057			9,174			9,177			9,230			9,331

Market information (period-end)
Net income per share (Ch$)		0.38			0.43			0.45			0.38			0.40			0.42			0.51
Net income per ADR (US$)		0.74			0.84			0.92			0.79			0.95			0.83			0.96
Stock price		25.9			25.2			24.8			24.5			21.9			21.4			21.9
ADR price		49.9			49.5			50.6			51.0			52.3			43.0			42.8
Market capitalization (US$mn)		9,045			8,985			9,172			9,248			9,479			7,801			7,761
Shares outstanding		188,446.1			188,446.1			188,446.1			188,446.1			188,446.1			188,446.1			188,446.1
ADRs (1 ADR = 1,039 shares)		181.4			181.4			181.4			181.4			181.4			181.4			181.4

Other Data
Quarterly inflation rate**		0.20	%		1.00	%		2.98	%		2.31	%		1.02	%		2.17	%		3.63	%
Avg. overnight interbank rate (nominal)		5.09	%		5.08	%		5.45	%		5.81	%		6.22	%		6.39	%		7.58	%
Avg. 10 year Central Bank yield (real)		2.69	%		2.90	%		3.08	%		2.97	%		2.84	%		3.06	%		3.39	%
Avg. 10 year Central Bank yield (nominal)		5.48	%		5.94	%		6.38	%		6.31	%		6.46	%		6.98	%		7.74	%
Observed Exchange rate (Ch$/US$) (period-end)		539.4			527.5			511.7			495.8			439.1			520.1			552.5

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 5 : QUARTERLY EVOLUTION OF BALANCE SHEET

Unaudited Balance Sheets	Mar-07		Jun-07		Sep-07		Dec-07		Mar-08		Jun-08		Sep-08
	(Reclassified)		(Reclassified)		(Reclassified)		(Reclassified)

Assets
Cash and balances from Central Bank		864,270		861,227		717,875		1,108,444		647,473		1,280,337		854,097
Funds to be cleared		364,106		361,098		339,009		316,240		626,731		487,591		513,843
Financial assets held for trading		821,657		764,369		879,302		1,100,292		715,729		893,938		891,070
Investment collateral under agreements to repurchase		46,691		31,112		39,192		34,000		4,655		11,697		8,805
Derivatives		377,628		419,417		585,000		780,775		1,427,176		1,233,562		1,296,402
Interbank loans		168,554		350,393		182,051		45,960		116,991		150,406		76,015
Loans, net of loan loss allowances		10,853,002		10,887,018		11,424,742		12,025,691		12,191,080		12,960,626		13,521,962
Available-for-sale financial assets		360,745		673,992		807,492		779,634		1,457,900		1,080,216		1,316,741
Held-to-maturity investments		-		-		-		-		-		-		-
Investments in other companies		7,026		5,707		5,847		6,736		6,181		6,865		7,186
Intangible assets		42,479		49,856		52,883		56,187		58,071		61,458		69,534
Fixed assets		223,906		228,351		237,602		245,619		247,348		248,906		253,918
Current tax assets		1,115		878		1,451		2,253		4,229		17,824		12,275
Deferred tax assets		40,024		46,808		59,325		54,062		57,386		62,721		101,876
Other assets		319,806		416,592		428,116		476,613		656,982		593,297		668,294
Total Assets		14,491,009		15,096,818		15,759,887		17,032,506		18,217,932		19,089,444		19,592,018

Average interest earning assets		11,590,544		11,931,595		12,343,716		12,840,100		13,547,248		14,252,583		14,365,245
Average loans		10,965,469		11,121,879		11,345,844		11,908,379		12,285,523		12,817,994		13,037,608

Liabilities and Equity
Total non-interest bearing deposits		2,491,571		2,591,979		2,598,156		2,868,769		2,773,548		3,195,906		3,132,432
Funds to be cleared		239,256		202,897		194,630		135,219		381,921		297,611		308,345
Investments sold under agreements to repurchase		374,022		261,046		392,388		310,388		92,583		295,494		741,043
Time deposits and savings accounts		7,281,003		7,343,085		7,273,079		7,887,897		8,407,623		8,390,418		8,408,557
Derivatives		375,290		365,167		568,580		778,217		1,540,408		1,081,784		1,122,579
Deposits from credit institutions		620,535		1,168,506		1,192,736		1,099,443		1,013,573		1,505,176		1,495,606
Marketable debt securities		1,573,763		1,708,506		1,891,697		2,166,110		2,196,889		2,405,006		2,372,389
Other obligations		70,047		52,409		118,870		147,867		86,697		138,185		101,998
Current tax liabilities		7,836		21,834		28,666		16,217		3,247		797		423
Deferred tax liability		478		476		4,271		3,677		14,321		23,549		56,892
Provisions		41,356		38,359		41,278		44,015		151,109		88,971		132,216
Other liabilities		81,202		96,616		88,061		116,599		136,745		293,351		219,034
Total Liabilities		13,156,359		13,850,880		14,392,412		15,574,418		16,798,664		17,716,248		18,091,514

Equity
Capital		761,853		761,853		761,853		818,535		818,535		818,535		818,535
Reserves		46,915		65,096		99,437		47,330		58,797		89,057		133,429
Unrealized gain (loss) Available-for-sale financial assets		- 2,272		- 4,445		- 3,872		- 9,475		- 21,155		- 45,900		- 31,204
Retained Earnings:
Retained earnings previous periods		438,501		252,872		252,873		273,004		581,651		381,030		381,030
Net income		72,189		152,675		237,872		308,647		75,643		154,083		250,580
Provision for mandatory dividend		-		-		-		-		- 115,288		- 46,225		- 75,174
Minority Interest		17,464		17,887		19,312		20,047		21,085		22,616		23,308
Total Equity		1,334,650		1,245,938		1,367,475		1,458,088		1,419,268		1,373,196		1,500,504
Total Liabilities and Equity		14,491,009		15,096,818		15,759,887		17,032,506		18,217,932		19,089,444		19,592,018

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ANNEX 6 : QUARTERLY EVOLUTION OF INCOME STATEMENT

Unaudited Income Statement	1Q07			2Q07			3Q07			4Q07			1Q08			2Q08			3Q08
	(Reclassified)			(Reclassified)			(Reclassified)			(Reclassified)
Interest revenue		278,271			363,074			477,765			465,875			397,943			498,564			624,221
Interest expense		(136,348	)		(188,867	)		(279,874	)		(267,457	)		(209,029	)		(277,113	)		(371,000	)
Net interest revenue		141,923			174,207			197,891			198,418			188,914			221,451			253,221
Fee income		57,097			59,440			62,606			65,887			65,657			68,727			69,529
Fee expense		(10,257	)		(10,563	)		(11,068	)		(13,126	)		(12,072	)		(12,781	)		(13,390	)
Net fee income		46,840			48,877			51,538			52,761			53,585			55,946			56,139
Net gains from mark-to-market and trading		46,297			33,339			(4,342	)		(51,309	)		(88,693	)		163,192			96,512
Exchange differences, net		161			(11,995	)		28,099			59,963			101,980			(141,173	)		(62,579	)
Total market related income		46,458			21,344			23,757			8,654			13,287			22,019			33,933
Other operating income		1,370			4,641			4,719			5,851			9,452			4,850			(1,094	)
Total operating income		236,591			249,069			277,905			265,684			265,238			304,266			342,199
Personnel expenses		(37,518	)		(42,742	)		(45,686	)		(49,572	)		(44,339	)		(51,800	)		(53,889	)
Administrative expenses		(34,921	)		(37,275	)		(40,566	)		(38,403	)		(38,699	)		(41,969	)		(42,238	)
Depreciation and amortization		(9,394	)		(10,013	)		(11,000	)		(11,600	)		(11,475	)		(13,078	)		(14,038	)
Other operating expenses		(6,005	)		(5,046	)		(7,967	)		(11,716	)		(8,894	)		(11,265	)		(12,802	)
Total operating expenses		(87,838	)		(95,076	)		(105,219	)		(111,291	)		(103,407	)		(118,112	)		(122,967	)
Provision expense		(59,440	)		(44,900	)		(47,197	)		(54,768	)		(60,930	)		(70,374	)		(72,128	)
Net operating income		89,313			109,093			125,489			99,625			100,901			115,780			147,104
Income attributable to investments in other companies		134			(728	)		(635	)		(92	)		(263	)		1,180			139
Price level restatement		(2,149	)		(13,633	)		(23,902	)		(16,641	)		(8,874	)		(22,546	)		(31,157	)
Net income before taxes		87,298			94,732			100,952			82,892			91,764			94,414			116,086
Income tax		(14,569	)		(13,964	)		(14,867	)		(11,771	)		(15,242	)		(14,841	)		(19,629	)
Net income from ordinary activities		72,729			80,768			86,085			71,121			76,522			79,573			96,457
Net income discontinued operations		0			0			0			0			0			0			0
Net income attributable to:
Minority interest		540			281			889			344			879			1,133			(40	)
Net income attributable to shareholders		72,189			80,487			85,196			70,777			75,643			78,440			96,497

Investor Relations Department

Bandera 140 19^th Floor, Santiago, Chile, Tel: 562-320-8284, fax: 562-671-6554,

email: rmorenoh@santander.cl

ESTADO DE SITUACIÓN FINANCIERA CONSOLIDADO

	Al 30 de septiembre de
	2008			2007
	$			$
	(Millones)			(Millones)
ACTIVOS
Efectivo y depositos en bancos		854.098			784.709
Operaciones con liquidación en curso		513.843			370.571
Instrumentos para negociación		891.070			961.165
Contratos de retrocompra y préstamos de valores		8.805			42.841
Contratos de derivados financieros		1.296.402			639.463
Adeudado por bancos		76.015			199.000
Créditos y cuentas por cobrar a clientes		13.521.962			12.488.386
Instrumentos de inversión disponibles para la venta		1.316.741			882.670
Instrumentos de inversión hasta el vencimiento		0			0
Inversiones en sociedades		7.186			6.391
Intangibles		69.534			57.806
Activo fijo		253.918			259.723
Impuestos corrientes		12.275			1.586
Impuestos diferidos		101.876			64.848
Otros activos		668.293			467.973
TOTAL ACTIVOS		19.592.018			17.227.132
PASIVOS
Depositos y otras obligaciones a la vista		3.132.432			2.840.044
Operaciones con liquidación en curso		308.345			212.750
Contratos de retrocompra y préstamos de valores		741.043			428.919
Depositos y otras captaciones a plazo		8.408.557			7.950.203
Contratos de derivados financieros		1.122.579			621.515
Obligaciones con bancos		1.495.606			1.303.780
Instrumentos de deuda emitidos		2.372.389			2.067.814
Otras obligaciones financieras		101.998			129.937
Impuestos corrientes		423			31.335
Impuestos diferidos		56.892			4.669
Provisiones		132.216			45.121
Otros pasivos		219.034			96.258
TOTAL PASIVOS		18.091.514			15.732.345

PATRIMONIO
Atribuible a tenedores patrimoniales del banco:
Capital		818.535			832.782
Reservas		133.429			108.695
Cuentas de valoración		(31.204	)		(4.233	)
Utilidades retenidas:		556.436			536.433
Utilidades retenidas de ejercicios anteriores		381.030			276.415
Utilidad (pérdida) del ejercicio		250.580			260.018
Menos: Provision para dividendos mínimos		(75.174	)		0
		1.477.196			1.473.677

Interés minoritario		23.308			21.110
TOTAL PATRIMONIO		1.500.504			1.494.787

TOTAL PASIVOS Y PATRIMONIO		19.592.018			17.227.132

ESTADO CONSOLIDADO DE RESULTADOS

Por el período comprendido entre el 1 de enero y el 30 de septiembre de

	2008			2007
	$			$
	(Millones)			(Millones)
Ingresos por intereses y reajustes		1.520.729			1.223.299
Gastos por intereses y reajustes		(857.143	)		(661.424	)
Ingreso neto por intereses y reajustes		663.586			561.875
Ingresos por comisiones		203.913			195.820
Gastos por comisiones		(38.244	)		(34.857	)
Ingreso neto de comisiones		165.669			160.963
Utilidad neta operaciones financieras		171.011			82.303
Utilidad (pérdida) de cambio neta		(101.771	)		17.779
Otros ingresos operacionales		13.203			11.732
Total Ingresos operacionales		911.698			834.652
Provisiones por riesgo de crédito		(203.431	)		(165.645	)
INGRESO OPERACIONAL NETO		708.267			669.007
Remuneraciones y gastos del personal		(150.028	)		(137.672	)
Gastos de administración		(122.905	)		(123.260	)
Depreciaciones y amortizaciones		(38.590	)		(33.238	)
Deterioro		0			0
Otros gastos operacionales		(32.961	)		(20.787	)
TOTAL GASTOS OPERACIONALES		(344.484	)		(314,957	)
RESULTADO OPERACIONAL		363.783			354.050
Resultado por inversiones en sociedades		1.057			(1.343	)
Correctión monetaria		(62.576	)		(43.378	)
Resultado antes de impuesto a la renta		302.264			309.329
Impuesto a la renta		(49.712	)		(47.440	)
UTILIDAD (PÉRDIDA) CONSOLIDADA DEL EJERCICIO.		252.552			261.889
Atribuible a:
Tenedores patrimoniales del Banco		250.580			260.018
Interés Minoritario		1.972			1.871
Utilidad por acción atribuible a tenedores
patrimoniales del Banco:
(expresada en pesos)
Utilidad básica		1.330			1.380
Utilidad diluida		1.330			1.380

ROBERTO JARA CABELLO		OSCAR VON CHRISMAR
Director de Intervención y Control		Gerente General
Interno Corporativo

INFORMACIÓN PROPORCIONADA:

Los estados financieros intermedios consolidados trimestrales, referidos al Balance General, Estado de Resultados, Estados de Resultados Integrales, Estado de Cambios Patrimoniales y Estado de Flujos de Efectivo, se encuentran a disposición de los interesados en el sitio www.santander.cl, pudiendo consultarse además en las oficinas del Banco.

EESS septiembre 2008.indd 1

27/10/08 16:56:52