Forget about Lloyds!

I’m happy to ignore UK-centric banks like Lloyds and Natwest. To my mind, the prospect of weak GDP growth in Britain over the next several years makes them unattractive stocks to buy today. I could be wrong, of course, but I’d much rather invest in banks that offer their services in fast-growing emerging economies. One such stock I’d happily load up on today is Banco Santander (LSE: BNC).

Let me put in an early disclaimer here. Like Lloyds and other domestic operators, Santander faces significant danger in the near term as Covid-19 drags on and inflation soars. The company has an extensive footprint in Latin America where economic conditions are deteriorating sharply.

In Mexico, for example, the economy has just moved into a technical recession, partly due to ongoing supply chain issues. Meanwhile in Brazil — a market from where Santander generates around 28% of underlying profit — is already in recession.

Conditions there are tipped to worsen before they improve too, as political uncertainty rises ahead of October’s presidential election and inflation rockets.

One of the best banking stocks to buy?

As a long-term investor I’m still considering buying Santander shares however. That’s because I expect demand for its banking products to recover strongly as the decade progresses. I certainly believe sales growth will be more impressive than at Lloyds, for example.

Financial services penetration in Latin America remains extremely low versus developed markets. This gives the likes of Santander plenty of business to win as wealth levels in the region balloon.

Analysts at McKinsey & Company have said that “the Latin American banking market is among the fastest growing in the world”. This gives Santander enormous opportunity, given its high profile in these fast-growing territories. The bank sits in the top three banks by market share in key Latin American economies Brazil, Mexico, Chile and Argentina.

A top electric vehicle stock

Therefore I think Santander could enjoy excellent earnings growth in the next 10 years. And I believe the same could be said for Chargepoint (NYSE: CHPT) too. Why? This US share provides charging points that keep electric cars running. It operates this infrastructure in North America and Europe as so is well-placed to exploit the global EV boom.

On Monday, luxury car builder Aston Martin announced it will only sell battery-powered and hybrid vehicles from 2026. It’s one of many major manufacturers who are stepping up investment in EVs and illustrates the bright sales outlook for low-carbon vehicles. Analysts at BloombergNEF think they could command a 24% market share of all vehicles in the US by 2026, moving to 50% by 2030.

But Chargepoint could suffer some near-term trouble if supply chain issues continue to hit EV production. This problem would affect the use of its charging points by drivers. However, as someone who looks at investing from a long-term perspective, I’m still considering buying the business right now.

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