Spanish bank Santander said it will boost its balance sheet with proceeds from a $1.15 billion deal to sell a stake in its U.S. consumer finance business, as pressure mounts on European banks to strengthen capital.

The euro zone’s biggest bank said on Friday it planned to hike capital in Santander Consumer USA by about $1.15 billion, booking a $1 billion capital gain from a transaction that valued the unit at $4 billion.

Last month, chief executive Alfred Saenz said Santander was comfortable with its capital levels and had no plans to raise capital.

Santander’s subsidiary, Sovereign Bank, has locally made waves in the past few months. The bank is reportedly moving its headquarters to Boston from Pennsylvania, and adopting the corporate identity of its global banking giant parent, Santander.

Sponsor Auto Finance Holdings Series — a consortium of Warburg Pincus, Kohlberg Kravis Roberts and Centerbridge Partners — will subscribe $1 billion of the capital hike and Dundon DFS the remaining $150 million.

Santander will maintain a 65 percent stake in Santander Consumer USA after the capital hike, while Sponsor Auto Finance Holdings Series will hold 25 percent and Dundon DFS 10 percent.

The U.S. consumer finance business is one of Santander’s most profitable units, analysts say, and posted net profit of $455 million in 2010.