People walk at the door of a Sabadell bank office in Barcelona, Spain, September 7, 2021. REUTERS/Albert Gea/File Photo | Reuters

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Spain's Banco Sabadell swung to a fourth-quarter net profit of 161 million euros ($182 million), lifted by British subsidiary TSB and lower provisions as it recovered from pandemic-related losses.

Analysts polled by Reuters had expected a net profit of 34 million euros in the three months to Dec. 31, compared with the 201 million euro loss posted by Spain's fourth-largest bank by assets in the same period of 2020.

Sabadell said quarterly results were also boosted by a 56% jump in new mortgages in Britain to a record of almost 2.17 billion pounds.

Lower impairments for the whole year helped the bank to a 530 million euro net profit in 2021, far exceeding the 2 million euros booked in 2020 and 403 million euros expected by analysts.

This allowed the bank to close the year with a return on tangible equity (ROTE) of 5.05%, against 0.02% in 2020. It now expects ROTE of more than 6% in 2022, a year earlier than initially targeted in its strategic plan.

Though Sabadell had been planning to sell TSB, it has frozen the process until it turns around the business. In 2021 TSB's contribution to Sabadell group results rose to 118 million euros from a loss of 220 million euros in 2020.