Quarterly Report • Oct 26, 2023
Quarterly Report
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Third quarter │ January – September 2023
26 October 2023
Financial information Q3 Q2 Jan-Sep Jan-Sep¹ SEKm 2023 2023 % 2023 2022 % Total income 18 468 18 173 2 54 028 36 080 50 Net interest income 12 901 12 768 1 37 605 22 228 69 Net commission income 3 862 3 811 1 11 334 10 692 6 Net gains and losses on financial items 652 524 24 2 093 1 176 78 Other income² 1 053 1 069 -2 2 997 1 984 51 Total expenses 5 562 5 717 -3 17 689 15 215 16 of which administrative fines 0 -3 887 0 Profit before impairments, bank taxes and resolution fees 12 906 12 456 4 36 339 20 865 74 Impairment of intangible and tangible assets 2 11 -78 13 453 -97 Credit impairment 347 188 85 1 311 800 64 Bank taxes and resolution fees 1 110 844 32 2 472 1 392 78 Profit before tax 11 447 11 414 0 32 542 18 220 79 Tax expense 2 321 2 291 1 6 734 3 640 85 Profit for the period 9 125 9 123 0 25 808 14 580 77 Earnings per share, SEK, after dilution 8.09 8.09 22.90 12.95 Return on equity, % 19.3 20.4 18.9 12.0 C/I ratio 0.30 0.31 0.33 0.42 Common Equity Tier 1 capital ratio, % 18.7 18.6 18.7 18.5 Credit impairment ratio, % 0.07 0.04 0.09 0.06
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures, and Other income from the Group income statement.
Our business is stable and profitable at a time of war, uncertainty and transition. Swedbank stands strong and contributes to growth and financial stability. We are a reliable partner for our customers.
The global economy remains resilient despite considerable turbulence and higher interest rates. According to the International Monetary Fund's World Economic Outlook, the global economy is expected to recover slowly after the crises of recent years. To reduce inflation towards the target, policy rates will remain at a high level for an extended period.
In Sweden and Estonia, household consumption has decreased and growth has slowed faster than in the rest of the world. Lithuania and Latvia have done slightly better. The inflation rate has fallen but remains at too high levels in all four home markets.
Swedbank's profit for the quarter was stable at SEK 9.1 billion. The return on equity was 19.3 per cent. In a highly competitive market, lending volumes increased while margins declined. Commission income increased. Expenses decreased on a seasonal basis and the cost/income ratio improved to 0.30.
Our credit quality is good and we are confident about our conservative and thorough lending process. Customers want the bank's expertise and are acting to deal with the current economic situation. Our propertyrelated exposure is aligned with the bank strategy and risk appetite.
The capital buffer increased to 3.7 percentage points. Swedbank has a strong liquidity position and we have continued to take advantage of the opportunities in the funding markets. I am proud that we were the first Nordic bank to issue a social bond to finance, among other things, companies that develop communications tools for the disabled and residential housing companies that invest in disadvantaged areas.
The focus on, and investment in, sustainable infrastructure have produced good results in the past year. During the quarter, we took another step through a strategic partnership and outsourced operation and maintenance of technical infrastructure to external suppliers, with better capacity to meet future requirements.
Of the more than 2 million conversations with customers handled by the bank every quarter, over 40 per cent now occur through our new communication platform, which has been rolled out in Estonia, Latvia and Lithuania. The platform shortens waiting times and makes customer interactions more efficient. Within a month or so, it will be Swedish Banking's turn.
We are now streamlining the organisation in line with our plan to deliver a sustainable return on equity of 15 per cent from 2025 and onwards. To increase availability and customer satisfaction, we plan to separate out and create a business area for the premium and private banking customer segment and to transfer all corporate customers in Sweden that
currently have an advisor to the Corporates and Institutions business area.
The corporate business in Sweden is stable. We focus on profitable business with low credit risk. Our goal to grow the corporate business within Baltic Banking is succeeding. We are there for our customers, and we see that loan growth for transition to renewable energy is strong.
We will have the best full-service offering for our customers while consolidating our leading position in the mortgage market. The level of activity in the Swedish housing market continues to be subdued and prices are slightly down. In the Baltic markets, real wages have increased and the mortgage portfolio is developing positively. Our green mortgage offering for sustainable housing in Estonia and Latvia is very popular.
Higher costs of living contributed to lower deposit volumes. Savers still value our offerings and volumes rose for term savings accounts. In Sweden, we raised all our savings rates. Monthly savings are stable, as is Robur's position as the leading fund company. In Estonia, Latvia and Lithuania, we are helping to foster a long-term saving culture by providing a favourable interest rate on our popular e-savings account, Easy Saver, which offers unlimited withdrawals.
Our customer promise is to make their financial lives easier. We are seeing high demand for support and advice on both the private and corporate sides, and we are investing to become even better. A new customer centre is being established in Umeå. The number of visits to our digital Financial Health advice service is at a good level in Sweden, and Savings is the most visited site.
Our vision is a financially sound and sustainable society, and our financial strength enables us to finance the green transition. Our expertise is available for customers in our branches from Monday to Friday, in our customer centres seven days a week, and roundthe-clock in our digital channels.
In Sweden, we are establishing the Institute for Financial Health, where we will bring together everyone in the bank who works with societal engagement and financial literacy. In this way, we will reach out on in an even broader manner. All in line with our 200-year savings bank tradition.
Our customers' future is our focus.
Jens Henriksson President and CEO
| Financial overview Economy and market Important to note Group development Result third quarter 2023 compared with second quarter 2023 Result January-September 2023 compared with January-September 2022 Volume trend by product area Credit and asset quality Funding and liquidity Ratings Operational risks Capital and capital adequacy Investigations Other events Events after the end of the period |
4 5 5 5 5 6 6 8 8 9 9 9 10 10 10 |
|---|---|
| Business areas Swedish Banking |
11 |
| Baltic Banking | 13 |
| Corporates and Institutions | 15 |
| Group Functions and Other | 17 |
| Eliminations | 18 |
| Financial statements - Group | |
| Income statement, condensed Statement of comprehensive income, condensed |
19 20 |
| Balance sheet, condensed | 21 |
| Statement of changes in equity, condensed | 22 |
| Cash flow statement, condensed | 23 |
| Notes to the financial statements | |
| Note 1 Accounting policies Note 2 Critical accounting estimates |
24 24 |
| Note 3 Changes in the Group structure | 24 |
| Note 4 Operating segments (business areas) | 25 |
| Note 5 Net interest income | 28 |
| Note 6 Net commission income | 29 |
| Note 7 Net gains and losses on financial items | 30 |
| Note 8 Net insurance income Note 9 Other general administrative expenses |
31 31 |
| Note 10 Credit impairment | 32 |
| Note 11 Bank taxes and resolution fees | 35 |
| Note 12 Loans | 36 |
| Note 13 Credit impairment provisions | 38 |
| Note 14 Credit risk exposures | 39 |
| Note 15 Intangible assets Note 16 Amounts owed to credit institutions |
40 40 |
| Note 17 Deposits and borrowings from the public | 40 |
| Note 18 Debt securities in issue, senior non-preferred liabilities and subordinated liabilities | 41 |
| Note 19 Derivatives | 41 |
| Note 20 Valuation categories for financial instruments | 42 |
| Note 21 Financial instruments recognised at fair value | 44 |
| Note 22 Assets pledged, contingent liabilities and commitments Note 23 Offsetting financial assets and liabilities |
45 46 |
| Note 24 Capital adequacy, consolidated situation | 47 |
| Note 25 Internal capital requirement | 49 |
| Note 26 Risks and uncertainties | 49 |
| Note 27 Related-party transactions | 50 |
| Note 28 Swedbank's share | 51 |
| Note 29 Effects of changes in accounting policies regarding IFRS 17 Financial statements - Swedbank AB |
52 55 |
| Alternative performance measures | 60 |
| Signatures of the Board of Directors and the President | 62 |
| Review report | 63 |
| Publication of financial information | 64 |
More detailed information can be found in Swedbank's Fact book, www.swedbank.com/ir, under Financial information and publications
| Income statement | Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |||
|---|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % | 2022 | % | 2023 | 2022 | % |
| Net interest income | 12 901 | 12 768 | 1 | 8 358 | 54 | 37 605 | 22 228 | 69 |
| Net commission income | 3 862 | 3 811 | 1 | 3 624 | 7 | 11 334 | 10 692 | 6 |
| Net gains and losses on financial items | 652 | 524 | 24 | 963 | -32 | 2 093 | 1 176 | 78 |
| Other income² | 1 053 | 1 069 | -2 | 775 | 36 | 2 997 | 1 984 | 51 |
| Total income | 18 468 | 18 173 | 2 | 13 720 | 35 | 54 028 | 36 080 | 50 |
| Staff costs | 3 429 | 3 417 | 0 | 3 191 | 7 | 10 312 | 9 465 | 9 |
| Other expenses | 2 133 | 2 303 | -7 | 1 994 | 7 | 6 491 | 5 750 | 13 |
| Administrative fines | 0 | -3 | 0 | 887 | 0 | |||
| Total expenses | 5 562 | 5 717 | -3 | 5 185 | 7 | 17 689 | 15 215 | 16 |
| Profit before impairments, bank taxes and resolution | ||||||||
| fees | 12 906 | 12 456 | 4 | 8 535 | 51 | 36 339 | 20 865 | 74 |
| Impairment of intangible assets | 0 | 11 | 443 | 11 | 443 | -98 | ||
| Impairment of tangible assets | 2 | 0 | 10 | -76 | 3 | 10 | -71 | |
| Credit impairment | 347 | 188 | 85 | 602 | -42 | 1 311 | 800 | 64 |
| Bank taxes and resolution fees | 1 110 | 844 | 32 | 466 | 2 472 | 1 392 | 78 | |
| Profit before tax | 11 447 | 11 414 | 0 | 7 014 | 63 | 32 542 | 18 220 | 79 |
| Tax expense | 2 321 | 2 291 | 1 | 1 423 | 63 | 6 734 | 3 640 | 85 |
| Profit for the period | 9 125 | 9 123 | 0 | 5 591 | 63 | 25 808 | 14 580 | 77 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures, and Other income from the Group income statement.
| Q3 | Q2 | Q3¹ | Jan-Sep Jan-Sep¹ | ||
|---|---|---|---|---|---|
| Key ratios and data per share | 2023 | 2023 | 2022 | 2023 | 2022 |
| Return on equity, % | 19.3 | 20.4 | 13.5 | 18.9 | 12.0 |
| Earnings per share before dilution, SEK² | 8.11 | 8.11 | 4.97 | 22.95 | 12.98 |
| Earnings per share after dilution, SEK² | 8.09 | 8.09 | 4.96 | 22.90 | 12.95 |
| C/I ratio | 0.30 | 0.31 | 0.38 | 0.33 | 0.42 |
| Equity per share, SEK² | 171.5 | 164.1 | 150.7 | 171.5 | 150.7 |
| Loans to customers/deposit from customers ratio, % | 142 | 139 | 141 | 142 | 141 |
| Common Equity Tier 1 capital ratio, % | 18.7 | 18.6 | 18.5 | 18.7 | 18.5 |
| Tier 1 capital ratio, % | 20.5 | 20.4 | 19.8 | 20.5 | 19.8 |
| Total capital ratio, % | 23.0 | 23.7 | 23.1 | 23.0 | 23.1 |
| Credit impairment ratio, % | 0.07 | 0.04 | 0.13 | 0.09 | 0.06 |
| Share of Stage 3 loans, gross, % | 0.37 | 0.34 | 0.34 | 0.37 | 0.34 |
| Total credit impairment provision ratio, % | 0.39 | 0.38 | 0.30 | 0.39 | 0.30 |
| Liquidity coverage ratio (LCR), % | 159 | 167 | 154 | 159 | 154 |
| Net stable funding ratio (NSFR), % | 121 | 123 | 117 | 121 | 117 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29. 2) The number of shares and calculation of earnings per share are specified in Note 28.
| Balance sheet data | 30 Sep | 31 Dec¹ | 30 Sep¹ | ||
|---|---|---|---|---|---|
| SEKbn | 2023 | 2022 | % | 2022 | % |
| Loans to customers | 1 808 | 1 799 | 0 | 1 798 | 1 |
| Deposits from customers | 1 278 | 1 298 | -2 | 1 277 | 0 |
| Equity attributable to shareholders of the parent company | 193 | 176 | 10 | 169 | 14 |
| Total assets | 3 018 | 2 855 | 6 | 2 994 | 1 |
| Risk exposure amount | 838 | 809 | 4 | 753 | 11 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
Definitions of all key ratios can be found in Swedbank's Fact book on page 74.
Globally, uncertainty about the economic and inflation outlook persisted during the quarter and government bond rates rose, particularly for longer maturities. Meanwhile, stock market indexes fell slightly. The rise in interest rates has been led by the U.S., where the economy remains strong. The Federal Reserve is now expected to keep higher policy rates for an extended period. The U.S. dollar and euro have both strengthened against the Swedish krona. During the quarter, the krona traded at record-low levels against the euro but strengthened slightly toward the end of the quarter.
In the U.S., inflation rose, driven by higher energy prices, while it continued to fall in the euro zone. Underlying inflation, adjusted for volatile components such as energy, continued to decline, however, in both the U.S. and the euro zone. Economic activity clearly downshifted in the euro zone, judging by the Purchasing Managers' Index for both manufacturing and the service sector, while it was stable in the U.S. In China, the economy continued to weaken although with some signs of a stabilisation.
Central banks continue to try to strike a balance between fighting the high inflation addressing the weakening economic development. The Federal Reserve raised its policy rate in July and then left it unchanged. The ECB raised policy rates twice during the quarter. The Riksbank raised its policy rate by 0.25 percentage points to 4.0 per cent in September and signalled that it could be raised again.
In the second quarter, Swedish GDP is estimated to have decreased by 0.8 per cent. The decline was broadbased and driven by weak consumption, housing investment and net exports. Data for the first two months of the third quarter were slightly better. According to the GDP indicator, growth rose by 0.8 per cent in July before falling by 0.2 per cent in August. At the same time private sector output increased in July and August. On the other hand, the National Institute of Economic Research's Economic Tendency Survey was muted in the third quarter and indicated a weaker economic sentiment than normal. The PMI for the service sector and manufacturing industry also indicated a weak development. After a long period of relative strength, the labour market worsened during the quarter with rising unemployment even though employment remained high. Inflation continued to fall but is still significantly above the Riksbank's 2% target.
In the housing market, buyers remained cautious. Price development was weak while the number of transactions remained low. In August, aggregate mortgage volume was 1 per cent higher than the same month in 2022, while it was it was largely unchanged compared to the end of the previous quarter.
In the Baltic economies, economic development lost momentum, impacted by weaker global economic conditions and high domestic inflation. Estonia's GDP fell in the second quarter with negative contributions from consumption, investments and inventory levels. Despite the economic downturn, the labour market remained strong. GDP also fell in Latvia, driven by weaker consumption and falling goods exports. The situation was different in Lithuania, which reported a strong recovery after the sharp downturn in the previous quarter. Increased public investment contributed to
growth in Latvia and Lithuania. Sentiment seems to have stabilised and consumer confidence in Latvia and Lithuania recovered from low levels. The previously very high inflation continued to fall during the quarter and in September averaged just under 4 per cent in the three countries. In addition, the labour markets have still been relatively strong and property prices have been stable to date.
This interim report contains alternative performance measures that Swedbank considers valuable information for the reader, since they are used by the executive management for internal governance and performance measurement as well as for comparisons between reporting periods. Further information on the alternative performance measures used in the interim report can be found on page 58.
Swedbank's profit was stable at SEK 9 125m (9 123). Income increased and expenses decreased, while credit impairments and tax expenses rose. Foreign exchange effects positively impacted profit by SEK 83m before impairment, bank taxes and resolution fund fees.
The return on equity was 19.3 per cent (20.4) and the cost income ratio was 0.30 (0.31).
Income increased to SEK 18 468m (18 173) mainly due to higher net interest income and net gains and losses on financial items. Net commission income also rose, while other income decreased. Foreign exchange effects positively impacted income by SEK 115m.
Net interest income increased by 1 per cent to SEK 12 901m (12 768). Underlying net interest income was positively affected by higher deposit margins in Baltic Banking due to rising market rates. Lower mortgage margins and lower average deposit volumes in Swedish Banking negatively impacted net interest income. Net interest income from corporate lending increased slightly. One additional day in the quarter as well as a weaker krona positively impacted net interest income.
Net commission income increased by 1 per cent to SEK 3 862m (3 811). Income from asset management increased due to day count and foreign exchange effects, and a strong global market performance. Income from card operations was lower in the quarter mainly due to rebates from Mastercard in the second quarter.
Net gains and losses on financial items increased to SEK 652m (524). Most of the increase was related to positive valuation effects within Group Treasury. Corporates and Institutions' net gains and losses on financial items decreased due to valuation effects on derivatives.
Other income decreased by 2 per cent to SEK 1 053m (1 069).
Expenses decreased by 3 per cent to SEK 5 562m (5 717) due to seasonally lower consulting expenses and marketing activities. AML-related investigation expenses amounted to SEK 85m (78). Foreign exchange effects increased expenses by SEK 32m.
Credit impairments amounted to SEK 347m (188). Rating and stage migrations accounted for SEK 831m (648), while expert credit adjustments decreased by SEK -158m (-315). Updated macroeconomic scenarios increased credit impairments by SEK 201m (-22). For individually assessed loans, credit impairments decreased by SEK -265m (29), mainly as a result of amortisations within oil and offshore exposures.
Bank taxes and resolution fees amounted to SEK 1 110m (844). The increase was due to the introduction of a temporary bank tax in Lithuania from the middle of the second quarter this year through 2024.
The tax expense amounted to SEK 2 321m (2 291), corresponding to an effective tax rate of 20.3 per cent (20.1). The slightly higher effective tax rate in the third quarter was largely due to the non-deductible decrease in value of shares and partnerships.
Swedbank's profit increased to SEK 25 808m (14 580) due to higher income. Higher expenses, credit impairments and bank taxes affected profit negatively. Expenses increased partly because of the Swedish FSA's administrative fine and a settlement with the Office of Foreign Assets Control (OFAC). Foreign exchange effects positively impacted profit before impairments, bank taxes and resolution fees by SEK 1 005m.
The return on equity was 18.9 per cent (12.0) and the cost/income ratio was 0.33 (0.42). Adjusted for the Swedish FSA's administrative fine and the settlement with OFAC, the return on equity was 19.4 per cent and the cost/income ratio was 0.31.
| Jan-Sep Jan-Sep Jan-Sep | |||
|---|---|---|---|
| 2023 | 2023 | 2022 | |
| Income statement, SEKm | excl¹ | ||
| Total income | 54 028 | 54 028 | 36 080 |
| Total expenses | 17 689 | 16 802 | 15 215 |
| of which administrative fines | 887 | 0 | |
| Profit before tax | 32 542 | 33 429 | 18 220 |
| Profit for the period | 25 808 | 26 695 | 14 580 |
| Return on equity, % | 18.9 | 19.4 | 12.0 |
| C/I ratio | 0.33 | 0.31 | 0.42 |
1) Income statement excluding expenses for the administrative fines
Income increased to SEK 54 028m (36 080) mainly because of higher net interest income. Net commission income, net gains and losses on financial items, and other income also increased. Foreign exchange effects positively impacted income by SEK 1 399m.
Net interest income increased by 69 per cent to SEK 37 605m (22 228). Underlying net interest income was positively affected mainly from higher deposit margins following higher market rates. Higher lending volumes also contributed together with a weaker krona. Net commission income increased by 6 per cent to SEK 11 334 (10 692). Income from card operations and payments increased due to residual Covid effects in the previous year and discounts from Mastercard this year. Income from asset management also contributed.
Net gains and losses on financial items increased to SEK 2 093m (1 176). Group Treasury's net gains and losses on financial items benefitted from positive changes in the value of derivatives and the liquidity portfolio. Within Corporates and Institutions, a recovery in market valuations related to the trading portfolio of corporate bonds and higher income from fixed income trading contributed. Derivative valuation adjustments had a negative effect.
Other income increased by 51 per cent to SEK 2 997m (1 984), mainly because the previous year's net insurance was more negatively affected by higher market interest rates.
Expenses increased by 16 per cent to SEK 17 689m (15 215). Adjusted for the Swedish FSA's administrative fine and a settlement with OFAC, expenses increased by 10 per cent. Staff costs increased primarily due to higher salaries and to the extra compensation paid in the Baltic countries. AML-related investigation expenses amounted to SEK 269m (299). High inflation also contributed to expenses. Foreign exchange effects increased expenses by SEK 394m.
Credit impairments amounted to SEK 1 311m (800) and were mainly explained by negative rating and stage migrations and updated macroeconomic scenarios, partly offset by lower expert credit adjustments and credit impairment provisions for individually assessed loans.
Bank taxes and resolution fees amounted to SEK 2 472m (1 392). The increase was due to the fact that the Swedish bank tax rate was raised from 0.05 per cent to 0.06 per cent in 2023 and because Lithuania introduced a temporary bank tax in the middle of the second quarter this year.
The tax expense amounted to SEK 6 734m (3 640), corresponding to an effective tax rate of 20.7 per cent (20.0). The higher effective tax rate in the current period was largely due to the non-deductible administrative fine from the Swedish FSA.
Swedbank mainly conducts business in the product areas of lending, deposits, fund savings and life insurance, and payments.
Loans to customers increased by SEK 5bn to SEK 1 808bn (1 803) in the quarter. Compared to the third quarter 2022 lending increased by SEK 10bn or 1 per cent. Foreign exchange effects negatively impacted lending volumes by SEK 6bn compared to the second quarter 2023 and positively by SEK 23bn compared to the third quarter 2022.
| 30 Sep | 30 Jun 30 Sep¹ | ||
|---|---|---|---|
| Loans to customers, SEKbn | 2023 | 2023 | 2022 |
| Loans, private mortgage | 1 035 | 1 036 | 1 028 |
| of which Swedish Banking | 911 | 911 | 917 |
| of which Baltic Banking | 124 | 125 | 111 |
| Loans, private other incl tenant | |||
| owner associations | 145 | 145 | 147 |
| of which Swedish Banking | 28 | 30 | 81 |
| of which Baltic Banking | 24 | 24 | 20 |
| of which Corporates and Inst. | 92 | 92 | 46 |
| Loans, corporate | 628 | 621 | 623 |
| of which Swedish Banking | 133 | 134 | 143 |
| of which Baltic Banking | 112 | 106 | 96 |
| of which Corporates and Inst. | 382 | 381 | 382 |
| of which Group Functions and | |||
| Other | 1 | 1 | 2 |
| Total | 1 808 | 1 803 | 1 798 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023. For more information see Important to note on page 5.
Lending to mortgage customers within Swedish Banking was unchanged at SEK 911bn (911) during the quarter. The market share in mortgages in Sweden was 22 per cent as of 31 August. Other private lending in Sweden, including to tenant-owner associations, was also unchanged and amounted to SEK 121bn (121) in the quarter.
Baltic Banking's mortgage volumes increased by 4 per cent in local currency and amounted to the equivalent of SEK 260bn (255) at the end of the quarter.
Corporate lending increased by SEK 7bn during the quarter to SEK 628bn (621). In Sweden, the market share was 15 per cent as of 31 August.
The sustainable asset registry increased by SEK 3bn to SEK 70bn (67) in the quarter. The increase was primarily related to financing for green buildings but also to financing of sustainable transports. At the end of the quarter, the registry contained SEK 63bn in green assets and SEK 7bn in social assets, which are financed by the bank's sustainable bonds. For more information on lending and the sustainable asset registry, see pages 34 and 67 of the Fact book.
Total deposits in the business areas decreased by SEK 22bn to SEK 1 272bn (1 294) compared to the previous quarter. During the quarter, deposits from the public decreased within Swedish Banking while customers continued to make extra amortisations. Deposits from the public within Baltic Banking were stable in local currency. Corporate deposits decreased within Corporates and Institutions, Swedish Banking and Baltic Banking, including in local currency. Compared to the third quarter 2022 total deposits in the business areas were stable.
Total deposits from customers amounted to SEK 1 278bn (1 298). Foreign exchange effects negatively impacted total deposit volume by SEK 8bn compared to the previous quarter and positively by SEK 26bn compared to the second quarter 2022.
| 30 Sep | 30 Jun 30 Sep¹ | ||
|---|---|---|---|
| Deposits from customers, | 2023 | 2023 | 2022 |
| Deposits, private | 704 | 716 | 699 |
| of which Swedish Banking | 474 | 481 | 490 |
| of which Baltic Banking | 229 | 235 | 209 |
| Deposits, corporate | 574 | 582 | 578 |
| of which Swedish Banking | 136 | 139 | 168 |
| of which Baltic Banking | 147 | 152 | 133 |
| of which Corporates and | |||
| Institutions | 285 | 287 | 273 |
| of which Group Functions and | |||
| Other | 6 | 4 | 4 |
| Total | 1 278 | 1 298 | 1 277 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023. For more information see Important to note on page 5.
Swedbank's deposits from private customers decreased by SEK 12bn in the quarter to SEK 704bn (716).
Corporate deposits in the business areas decreased by SEK 10bn in the quarter to SEK 568bn (578).
As of 31 August, Swedbank's market share for deposits from private customers in Sweden was 18 per cent. The market share for corporate deposits was 15 per cent. For more information on deposits, see page 35 of the Fact book.
Assets under management by Swedbank fell by 3 per cent in the quarter to SEK 1 529bn (1 578) as of 30 September. The decrease was predominantly due to the market downturn, but net outflows also contributed.
| Asset management | 30 Sep | 30 Jun | 30 Sep |
|---|---|---|---|
| SEKbn | 2023 | 2023 | 2022 |
| Sweden | 1 430 | 1 477 | 1 192 |
| Estonia | 26 | 27 | 22 |
| Latvia | 36 | 37 | 28 |
| Lithuania | 35 | 35 | 28 |
| Other countries | 2 | 2 | 2 |
| Total Mutual funds under | |||
| Management | 1 529 | 1 578 | 1 272 |
| Closed End Funds | 1 | 1 | 0 |
| Discretionary asset management | 400 | 406 | 380 |
| Total assets under Management | 1 930 | 1 984 | 1 652 |
The net flow in the Swedish fund market amounted to SEK 5bn (34) in the quarter. The trend of the largest inflow to index funds also contributed this quarter with a net flow of SEK 19bn. Fixed income funds also had inflows, while actively managed equity funds, mixed funds and hedge funds reported outflows.
The net flow to Swedbank Robur's funds in Sweden amounted to SEK -2bn (7) during the quarter. The outflows were primarily in the distributions through the Swedish Pensions Agency. Meanwhile, Corporates and Institutions and Swedish Banking also reported net outflows. However, third-party distributors and the savings banks continued to generate net inflows during the quarter.
In Estonia, Latvia and Lithuania, the net flow amounted to SEK 2bn (2). By assets under management, Swedbank Robur is the leader in the Swedish and Baltic fund markets. As of 30 September, the market share in Sweden was 22 per cent. In Estonia and Lithuania it was 38 per cent, while in Latvia it was 40 per cent.
Life insurance assets under management in the Swedish operations decreased by 3 per cent in the quarter to SEK 319bn (327). Premium income,
consisting of premium payments and capital transfers, amounted to SEK 6bn (6).
| Assets under management, life insurance SEKbn |
2023 | 30 Sep 30 Jun 30 Sep 2023 |
2022 |
|---|---|---|---|
| Sweden | 319 | 327 | 271 |
| of which collective occupational | |||
| pensions | 179 | 182 | 146 |
| of which endowment insurance | 90 | 93 | 81 |
| of which occupational pensions | 40 | 41 | 34 |
| of which other | 11 | 11 | 10 |
| Baltic countries | 9 | 9 | 8 |
| Total assets under management | 328 | 337 | 279 |
For premium income, excluding capital transfers, Swedbank's market share in the first quarter (latest available data) was 7 per cent (7 per cent in the previous quarter). In the transfer market, Swedbank's market share was 10 per cent in the second quarter (8 per cent in the previous quarter).
In Estonia, Latvia and Lithuania, Swedbank is the largest life insurance company. The market shares for premium payments in the first eight months of 2023 were 49 per cent in Estonia, 28 per cent in Latvia and 22 per cent in Lithuania.
The total number of card transactions acquired in the quarter was 954 million, 3 per cent higher than the same period in 2022. The total number of transactions acquired in Sweden, Norway, Finland and Denmark increased by 2 per cent, while the number of transactions acquired in the Baltic countries increased by 9 per cent.
Acquired transaction volumes in Sweden, Norway, Finland and Denmark increased to SEK 235bn, 7 per cent higher than the same period in 2022. The corresponding volume in the Baltic countries amounted to SEK 38bn, 22 per cent higher than the same period in 2022. Due to the high inflation rate, acquired transaction volumes increased by more than the number of acquired card transactions.
The total number of Swedbank cards in issue at the end of the quarter was 8.4 million, in line with the end of the previous quarter.
| 30 Sep | 30 Jun | 30 Sep | |
|---|---|---|---|
| Number of cards | 2023 | 2023 | 2022 |
| Issued cards, millon | 8.4 | 8.4 | 8.3 |
| of which Sweden | 4.5 | 4.5 | 4.5 |
| of which Baltic countries | 3.9 | 3.9 | 3.8 |
The number of purchases in Sweden with Swedbank cards decreased by 0.5 per cent in the quarter compared to the same quarter in 2022. A total of 380 million card purchases were made. In the Baltic countries, the number of card purchases grew by 10 per cent in the same period to 251 million in the quarter.
In Sweden, there were 204 million domestic payments in the quarter, which was a decrease of 2 per cent compared to the same period in 2022. In the Baltic countries, 116 million domestic payments were processed, up 9 per cent compared to the same period in 2022. Swedbank's market share of payments via Bankgirot was 35 per cent. The number of international payments in Sweden increased by 3 per cent compared to the same quarter in 2022 to 1.7 million. In the Baltic
countries, international payments increased by 20 per cent to 7 million.
The economic situation with high inflation, rising interest rates and a weaker economy continues to challenge individuals and businesses, and weighed in particular on consumer-related sectors such as housing construction and retail. The weak Swedish krona posed further challenges to the Swedish economy and put pressure on, for example, the retail sector through higher import prices.
The credit quality of Swedbank's lending was high with low write-offs and little impact from bankruptcies. Credit quality indicators, such as the share of loans with late payments, rose slightly, but from low levels. Total credit impairment provisions amounted to SEK 8 105m (7 847), of which SEK 1 493m (1 661) was expert credit adjustments.
Mortgages in Sweden, which account for just over half of Swedbank's total lending, are of a high quality and historical mortgage-related credit impairments have been very low. During the quarter, there was a slight increase in loans with late payments. The number of forborne loans increased slightly after more applications for amortisation deferrals were granted. The loan-tovalue ratio in the mortgage portfolio in Sweden was 57 per cent. The loan-to-value ratios in the Baltic countries were 42 per cent in Estonia, 66 per cent in Latvia and 45 per cent in Lithuania.
Swedbank's lending to the property management sector amounted to SEK 301bn and accounted for 16 per cent of the total loan portfolio. Of this, 47 per cent was offices, 30 per cent residential properties and the rest manufacturing facilities, warehouses and other property management. In the lending approval process, Swedbank analyses the long-term repayment capacity of property companies and attaches great importance to stable cash flows. The loan-to-value ratio for lending to the property management sector was 53 per cent in total, 54 per cent for residential properties and 52 per cent for other properties.
The total share of loans in stage 2, gross, was 9.6 per cent (10.1). For personal loans the corresponding share was 7.3 per cent (8.4) and for corporate loans it was 15.6 per cent (14.2).
The share of loans in stage 3, gross, was 0.35 per cent (0.34). The provision ratio for loans in stage 3 was 29 per cent (36) mainly due to the decrease in shipping and offshore sector.
For more information on credit exposures, provisions and credit quality, see notes 10 and 12-14 as well as pages 37-49 of the Fact book.
During the third quarter, the capital markets were less volatile and central banks continued to raise policy rates to cool inflation. Yields on securities with both short and long maturities rose. The short-term funding market functioned well throughout the quarter and we saw increased interest in securities with longer maturities. This reflects the market's expectations that the period of significant rate hikes is nearing an end.
Swedbank took advantage of the stable market conditions and issued two senior non-preferred bonds in euro and U.S. dollar.
The euro bond is a social bond and an important instrument for Swedbank to promote social investments. The issue proceeds are being allocated to job creation through financing for small and midsized companies, socioeconomic development and affordable housing. Swedbank was the first Nordic bank to issue a social bond.
Swedbank issued SEK 39bn in long-term debt instruments in the quarter. As of 30 September, Swedbank's outstanding short-term funding (commercial paper) in issue amounted to SEK 384bn (364). Available cash and balances with central banks and reserves with the Swedish National Debt Office amounted to SEK 282bn (352) and the liquidity reserve amounted to SEK 653bn (672). The Group's Liquidity Coverage Ratio (LCR) was 159 per cent (167) and for USD, EUR and SEK it was 133, 221 and 107 per cent, respectively. The net stable funding ratio (NSFR) was 121 per cent (123). For more information on funding and liquidity, see notes 16-18 and pages 54–64 of the Fact book.
During the quarter, there were no changes in Swedbank's ratings. For more information on the ratings, see page 66 of the Fact book.
Cybersecurity preparedness was high during the quarter against the backdrop of escalated threats to the financial sector. Swedbank closely monitors developments and can reassess the level of cybersecurity risks as needed. The bank prioritises IT and information security due to the changing threat scenario resulting from geopolitical developments and an elevated risk of terrorism in Sweden. Swedbank has a strong capability to manage these risks.
The risk of fraud posed by organised crime remained high. Swedbank works continuously to maintain security for its customers and to educate them on how to protect themselves against fraud. During the quarter, the Swedish banking industry's anti-fraud campaign – "Hard to Trick" – continued.
The Common Equity Tier 1 (CET1) capital ratio was 18.7 per cent (18.6) at the end of the quarter. The total CET1 capital requirement, including Pillar 2 guidance, was 15.0 per cent (15.2) of the Risk Exposure Amount (REA), which resulted in a CET1 capital buffer of 3.7 per cent (3.5). CET1 capital increased to SEK 157bn (153) and was mainly affected by the quarterly profit and anticipated dividend.
(Refers to Swedbank consolidated situation)
REA increased to SEK 838bn (819) in the third quarter. REA for credit risk increased primarily due to the implementation of the risk weight floor for exposures collateralised by commercial properties in Pillar 1 REA, increased lending within Baltic Banking, and the implementation of new probability of default (PD) models for exposures to large corporates within Corporates and Institutions. REA for market risk decreased by SEK 3bn mainly through a decrease in positions vis-à-vis Swedish institutions. REA for Article 3 according to the EU's regulation on prudential requirements for credit institutions (CRR) decreased by SEK 26bn to balance the temporary add-on related to the ongoing review of internal ratings-based (IRB) models in the Pillar 2 requirement, as well as the abovementioned implementation of the new PD models for large corporates.
(Refers to Swedbank consolidated situation)
The leverage ratio was 6.0 per cent (5.8) and therefore exceeds the leverage ratio requirement including Pillar 2 guidance of 3.5 per cent.
The Swedish FSA decided on new capital requirements after the annual Supervisory Review and Evaluation Process (SREP). All in all, the changes in the Pillar 2 requirement (P2R) and REA imply minor changes to the nominal capital requirement and a slightly higher MREL requirement. In relation to the risk exposure amount (REA), the P2R for CET1 amounted to 1.8 per cent (1.5) and the Pillar 2 guidance (P2G) to 0.5 per cent (1.0). The P2G for the leverage ratio was 0.5 per cent (0.45) of the exposure amount for the leverage ratio.
The increase in the P2R was mainly caused by a temporary add-on of 1 per cent related to the ongoing review of IRB models. The majority of the change is due to an increase for mortgages in Sweden of 0.8 per cent over and above the mortgage floor. The add-on relates in its entirety to the review of new models, which is being examined by the Swedish FSA and is expected to be released when the new models are implemented. The models are expected to result in lower capital requirements than the add-on, and the Swedish FSA has set the level of the add-on to incentivise the bank to complete the implementation as quickly as possible. A corresponding provision for mortgages has not been made within the framework of the bank's voluntary Article 3 add-on, since the estimated REA outcome is expected to be below the mortgage floor by a wide margin when the models have been approved. Going forward, a slight increase in the REA over and above the bank's voluntary Article 3 add-on is expected as part of the approval process, which is expected to continue in 2024 and 2025.
The Swedish FSA's risk weight floor for exposures to commercial real estate, which was previously included as an add-on in the P2R, at the same time was eliminated and instead transferred directly to the REA. The P2G level was set based on the Swedish FSA's overall evaluation of stress tests and other qualitative criteria.
The Resolution Act, which entered into force in 2021, gradually phases in the MREL requirement by 1 January 2024, and Swedbank already meets the requirements by a wide margin.
The revised Basel III regulation, also called Basel IV, is scheduled to enter into force in 2025 with a phase-in period through 2032. The revisions include changes to the standardised approaches and internal models used to calculate the capital requirements for credit and market risk, operational risk and a capital requirement floor for internal models. The regulation is expected to result in a minor increase in the risk exposure amount for Swedbank and it must be approved by the European Council and the EU Parliament before it enters into force.
U.S. authorities continue to investigate Swedbank's historical anti-money laundering and counter-terrorism financing work and historical information disclosures. The investigations, which are being conducted by the Department of Justice (DoJ), the Securities and Exchange Commission (SEC) and the Department of Financial Services in New York (DFS), are continuing and the bank is holding individual discussions with the authorities through its U.S. legal advisors. The investigations are at different stages and the bank
cannot at this time determine any financial consequences or when the investigations will be completed.
In the first quarter 2022, Swedbank AS was informed by the Estonian Prosecutor's Office of suspected offences relating to money laundering in 2014–2016. The criminal investigation originates from the Estonian FSA's previous investigation of Swedbank AS in 2019. The maximum fine for the suspected crime is EUR 16m. The bank cannot at this time determine when the investigation will be completed.
On 10 July, it was announced that Swedbank is investing SEK 10m in Hemma, a B2B platform that aggregates data and analyses property energy performance. Through this collaboration, Swedbank, as Sweden's largest mortgage lender, strengthens its position in the housing market's climate transition.
On 4 September, Swedbank announced that it will separate out create a business area for premium and private banking customers. Furthermore, the corporate customers in Swedish Banking, which have an advisor, will be transferred to Corporates and Institutions. Swedbank appointed Anna-Karin Laurell as the new Head of Swedish Banking and Malin Lilliecrona as the Head of the new business area, both of whom will join the Group Executive Committee no later than 1 April 2024.
On 22 September, Swedbank was named the most loved brand at the annual Baltic Brand Awards ceremony. For the fifth year in a row, Swedbank is the most loved brand in the Baltic countries.
On 26 September, it was announced that Swedbank Robur is one of the founding participants of the Nature Action 100, an international initiative with the ambition to address nature loss and biodiversity decline from an investor perspective. A central part of the initiative is to monitor companies' advancements using key benchmark indicators.
On 17 October, Liza Jonson, the CEO of Swedbank Robur, won the Sustainable Leadership Award 2023. The motivation emphasised her dedication in leading the way towards a more positive and sustainable future for her own organisation as well as for competitors and society.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | ||||
|---|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % | 2022 | % | 2023 | 2022 | % |
| Net interest income | 6 333 | 6 597 | -4 | 4 906 | 29 | 19 493 | 12 132 | 61 |
| Net commission income | 2 286 | 2 284 | 0 | 2 149 | 6 | 6 758 | 6 377 | 6 |
| Net gains and losses on financial items | 92 | 88 | 5 | 83 | 11 | 283 | 154 | 83 |
| Other income² | 484 | 463 | 5 | 466 | 4 | 1 266 | 1 211 | 5 |
| Total income | 9 195 | 9 432 | -3 | 7 605 | 21 | 27 800 | 19 875 | 40 |
| Staff costs | 699 | 688 | 2 | 673 | 4 | 2 086 | 2 053 | 2 |
| Variable staff costs | 19 | 9 | 10 | 87 | 43 | 20 | ||
| Other expenses | 1 897 | 2 000 | -5 | 1 701 | 12 | 5 691 | 5 037 | 13 |
| Depreciation/amortisation | 4 | 5 | -14 | 6 | -35 | 14 | 21 | -31 |
| Total expenses | 2 620 | 2 703 | -3 | 2 390 | 10 | 7 834 | 7 130 | 10 |
| Profit before impairments, bank taxes and | ||||||||
| resolution fees | 6 575 | 6 729 | -2 | 5 214 | 26 | 19 966 | 12 745 | 57 |
| Credit impairment | 207 | 178 | 16 | 218 | -5 | 822 | 366 | |
| Bank taxes and resolution fees | 276 | 264 | 5 | 299 | -8 | 832 | 895 | -7 |
| Profit before tax | 6 093 | 6 287 | -3 | 4 697 | 30 | 18 312 | 11 483 | 59 |
| Tax expense | 1 143 | 1 219 | -6 | 866 | 32 | 3 524 | 2 144 | 64 |
| Profit for the period | 4 949 | 5 068 | -2 | 3 831 | 29 | 14 788 | 9 340 | 58 |
| Non-controlling interests | 3 | 1 | 4 | -36 | 2 | 4 | -37 | |
| Return on allocated equity, % | 30.9 | 31.6 | 24.1 | 30.8 | 19.8 | |||
| Loan/deposit ratio, % | 176 | 173 | 174 | 176 | 174 | |||
| Credit impairment ratio, % | 0.08 | 0.07 | 0.08 | 0.10 | 0.04 | |||
| Cost/income ratio¹ | 0.28 | 0.29 | 0.31 | 0.28 | 0.36 | |||
| Loans to customers, SEKbn | 1 072 | 1 075 | 0 | 1 141 | -6 | 1 072 | 1 141 | -6 |
| Deposits from customers, SEKbn | 610 | 620 | -2 | 658 | -7 | 610 | 658 | -7 |
| Full-time employees | 3 444 | 3 375 | 2 | 3 508 | -2 | 3 444 | 3 508 | -2 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023 and due to IFRS 17. For more information see Note 4, Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
Profit decreased by 2 per cent to SEK 4 949m (5 068). Lower income was partly offset by decreased expenses.
Net interest income decreased by 4 per cent to SEK 6 333m (6 597). Lower mortgage margins and lower average deposit volumes negatively impacted net interest income.
Household mortgage volumes were stable at SEK 911bn (911). Lending to tenant-owner associations was also stable, at SEK 3bn (3). Corporate lending decreased by SEK 2bn to SEK 132bn (134). Customer transfers to Corporates and Institutions negatively impacted lending volumes to tenant-owner associations and corporates by SEK 1bn.
Deposit volumes decreased by SEK 10bn to SEK 610bn (620). Household deposits decreased by SEK 6bn. Corporate deposits decreased by SEK 4bn, partly due to customer transfers to Corporates and Institutions.
Net commission income was stable at SEK 2 286m (2 284) mainly driven by higher asset management income, offset by lower card income.
Other income increased to SEK 484m (463) mainly due to increased net insurance.
Expenses decreased by 3 per cent to SEK 2 620m (2 703) mainly affected by a retroactive adjustment in the second quarter due to the reorganisation between Swedish Banking and Group Functions and Other.
Credit impairments amounted to SEK 207m (178) mainly affected by updated macroeconomic scenarios as well as rating and stage migrations, partly offset by decreased expert credit adjustments.
Profit increased to SEK 14 788m (9 340). Higher income was partly offset by higher expenses and credit impairments.
Net interest income increased by 61 per cent to SEK 19 493m (12 132) mainly due to higher deposit margins resulting from higher market interest rates. Lending margins decreased, but not to the same extent.
Net commission income increased to SEK 6 758m (6 377) mainly due to higher income from cards and asset management.
Net gains and losses on financial items increased to SEK 283m (154).
Other income increased to SEK 1 266m (1 211). Increased income from partly-owned savings banks was offset by lower income from Entercard and lower net insurance, where the net insurance was positively affected in the previous year by revised assumptions and calculations for provisions.
Expenses increased by 10 per cent to SEK 7 834m (7 130). The increase was attributable to among other things a retroactive adjustment between Swedish Banking and Group Functions and Other.
Credit impairments amounted to SEK 822m (366) mainly affected by updated macroeconomic scenarios as well as rating and stage migrations.
Activity in the housing market remained dampened during the quarter and house prices fell slightly. The number of transactions was low and the amortisation rate remained at a high level. Against the backdrop of rising market interest rates, Swedbank raised the mortgage rate for interest fixing periods up to 3 years. Our strategy of proactively contacting customers to attract more mortgage customers continued to be successful.
Deposits decreased during the quarter partly on account of higher expenses for households and businesses.
In asset management, we see that many customers are continuing their long-term monthly saving, while the weak Swedish stock market has meant that customers have partly reallocated their assets to global funds.
The current macroeconomic uncertainty kept demand high for support and advice from both private and corporate customers. Among private customers, the high inflation rate and rising interest rates are affecting their personal finances and forcing them to face hard financial choices and questions. We are there for our
customers and provide support and advice when are making long-term financial decisions and in managing the prevailing economic situation in the best possible way.
Activity among small and midsized companies dampened during the quarter owing to the economic uncertainty. Many companies are adopting a wait and see approach and are tending to delay investments. Also, customers in the forestry and agricultural sector were affected by the deteriorating macroeconomic situation. During the quarter, we continued to strengthen our presence and advisory capacity in this sector by recruiting additional forestry and agricultural specialists. To give our forestry and agricultural customers the tools to manage possible liquidity needs, we have extended our liquidity loan offering.
We also announced an organisational change whereby Swedbank is establishing a new business area focused on premium and private banking customers who are currently part of Swedish Banking. The change is a natural step to further improve service, advice and our offering for these customer groups. The change will take effect no later than 1 April 2024. In addition, the corporate customers within Swedish Banking who today have advisors will be transferred to Corporates and Institutions. The change is being made to further strengthen our corporate offering.
Swedbank's societal engagement through Young Entrepreneurship and our own initiatives Young Economy and Digital Economy are continuing. As of 30 September, we have educated over 60 000 young people as part of Young Economy and over 2 000 customers within the framework of the Digital Economy initiative. In September, part 2 of the banking industry's "Hard to Trick" campaign ton increase fraud awareness was launched. Besides webinars, advertising and information in digital channels, customers events will be held on the topic as well.
Mikael Björknert Head of Swedish Banking
Sweden is Swedbank's largest market, with around 4 million private customers and over 250 000 corporate customers. This makes Swedbank the largest Swedish bank by number of customers. Swedish Banking offers private customers and small to medium-sized companies financial services and advice adapted to their specific situation and needs. The bank is there for them throughout their journey – from small to big. Swedbank is a digital bank with physical meeting points and satisfies customers' needs with the help of partners. We are available through digital devices, by telephone or in person, depending on what customers need help with. The bank is strongly committed to the community and invests in an inclusive future where we promote economically sustainable thinking.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | ||||
|---|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % | 2022 | % | 2023 | 2022 | % |
| Net interest income | 4 937 | 4 629 | 7 | 2 221 | 13 506 | 5 098 | ||
| Net commission income | 871 | 856 | 2 | 760 | 15 | 2 543 | 2 183 | 16 |
| Net gains and losses on financial items | 134 | 140 | -4 | 114 | 18 | 407 | 304 | 34 |
| Other income² | 151 | 231 | -35 | -41 | 589 | -216 | ||
| Total income | 6 093 | 5 855 | 4 | 3 052 | 100 | 17 045 | 7 369 | |
| Staff costs | 505 | 478 | 6 | 408 | 24 | 1 459 | 1 145 | 27 |
| Variable staff costs | 25 | 30 | -15 | 12 | 73 | 40 | 83 | |
| Other expenses | 803 | 781 | 3 | 594 | 35 | 2 316 | 1 698 | 36 |
| Depreciation/amortisation | 47 | 46 | 2 | 45 | 5 | 139 | 134 | 4 |
| Administrative fines | 37 | 37 | ||||||
| Total expenses | 1 380 | 1 371 | 1 | 1 059 | 30 | 4 025 | 3 017 | 33 |
| Profit before impairments, bank taxes and | ||||||||
| resolution fees | 4 712 | 4 484 | 5 | 1 993 | 13 020 | 4 352 | ||
| Impairment of tangible assets | 2 | 0 | 10 | -80 | 3 | 10 | -70 | |
| Credit impairment | 166 | -26 | 132 | 26 | 111 | 118 | -6 | |
| Bank taxes and resolution fees | 620 | 349 | 25 | 994 | 74 | |||
| Profit before tax | 3 923 | 4 160 | -6 | 1 826 | 11 912 | 4 149 | ||
| Tax expense | 685 | 771 | -11 | 329 | 2 148 | 728 | ||
| Profit for the period | 3 238 | 3 389 | -4 | 1 498 | 9 764 | 3 422 | ||
| Return on allocated equity, % | 40.2 | 42.2 | 22.2 | 41.4 | 17.1 | |||
| Loan/deposit ratio, % | 69 | 66 | 66 | 69 | 66 | |||
| Credit impairment ratio, % | 0.26 | -0.04 | 0.25 | 0.06 | 0.08 | |||
| Cost/income ratio¹ | 0.23 | 0.23 | 0.35 | 0.24 | 0.41 | |||
| Loans to customers, SEKbn | 260 | 255 | 2 | 227 | 14 | 260 | 227 | 14 |
| Deposits from customers, SEKbn | 376 | 387 | -3 | 342 | 10 | 376 | 342 | 10 |
| Full-time employees | 4 738 | 4 706 | 1 | 4 702 | 1 | 4 738 | 4 702 | 1 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
Profit decreased to SEK 3 238m (3 389). Profit in local currency decreased due to higher credit impairments and the bank tax in Lithuania. Higher income contributed positively. Foreign exchange effects increased profit by SEK 57m.
Net interest income rose by 5 per cent in local currency mainly due to higher deposit margins resulting from higher market interest rates. Increased lending volumes and a positive day effect also contributed. Foreign exchange effects positively impacted net interest income by SEK 83m.
Lending increased by 4 per cent in local currency during the quarter. Lending to households increased by 2 per cent while corporate lending rose by 8 per cent. Foreign exchange effects negatively impacted by SEK 6bn.
Deposit volumes decreased by 1 per cent in local currency during the quarter. Household deposits were stable while corporate deposits fell by 1 per cent. Foreign exchange effects negatively impacted by SEK 8bn.
Net commission income was stable in local currency.
Net gains and losses on financial items decreased by 6 per cent in local currency due to changes in the value of shares in the Estonian operations in the previous quarter.
Other income decreased by 36 per cent in local currency because net insurance declined due to higher market interest rates and claims.
Expenses decreased by 1 per cent in local currency due to lower consulting and marketing expenses in the third quarter as well as the settlement with OFAC in the previous quarter. The decrease was offset by higher staff costs as well as the costs to improve digital
solutions and strengthen risk functions. Foreign exchange effects increased expenses by SEK 23m.
The bank tax in Lithuania amounted to SEK 586m (322) for the quarter. The tax increased since it applied to the entire third quarter.
Credit impairments amounted to SEK 166m (-26) and were mainly due to increased provisions for individually assessed loans as well as updated macroeconomic scenarios.
Profit increased to SEK 9 764m (3 422). Profit in local currency increased due to higher income, partly offset by higher expenses and bank tax. Foreign exchange effects positively impacted profit by SEK 802m.
Net interest income increased by 143 per cent in local currency mainly due to higher deposit margins and larger lending volumes. Foreign exchange effects impacted net interest income positively by SEK 1 119m.
Lending increased by 8 per cent in local currency. Household lending rose by 6 per cent while corporate lending rose by 10 per cent. Foreign exchange effects made a positive contribution of SEK 15bn.
Deposits increased by 4 per cent in local currency. Household deposits rose by 3 per cent while corporate deposits increased by 4 per cent. Foreign exchange effects made a positive contribution SEK 22bn.
Net commission income increased by 7 per cent in local currency largely owing to higher card income.
Net gains and losses on financial items increased by 23 per cent in local currency due to positive valuation effects in asset management and in the insurance portfolio during the year.
Other income increased in local currency because net insurance in the previous year was negatively impacted by higher market interest rates.
Expenses increased by 22 per cent in local currency mainly due to higher staff costs, cost increases linked to inflation, the settlement with OFAC and consulting expenses. Investments in digital solutions continued to rise. Foreign exchange effects increased expenses by SEK 335m.
Credit impairments amounted to SEK 111m (118). The largest share was credit impairment provisions for individually assessed loans.
The economic development in the Baltic economies remained sluggish in the third quarter, although lower inflation and a robust labour market contributed positively to consumer purchasing power. Activity in the housing market held up well, and despite the fact that higher interest rates made home purchases more expensive, Swedbank's mortgage portfolio continued to grow. Demand for consumer loans was stable. Customers' interest in smaller loans, for instance for home renovations and car purchases increased. Leasing volumes also grew during the quarter.
Corporate lending was negatively affected by the slowdown in export markets, but also by drought and extreme hailstorms that affected the agricultural sector during the summer. Despite this, corporate lending volumes grew during the quarter with strong demand from the public sector and state-owned enterprises, particularly in the renewable energy sector.
Swedbank continued to promote long-term savings. During the quarter, the interest rate on fixed-rate savings accounts was raised in all three Baltic countries. In Lithuania, as in Estonia and Latvia previously, interest was introduced on Easy Saver, a savings account with unlimited withdrawals. This is an important step to boost the savings culture and contribute to stronger financial health in the Baltic countries.
In August, the three Baltic countries were struck by a historically devastating storm. Swedbank quickly and clearly provided information on which damages were covered by Swedbank insurance, which was appreciated by customers.
The work to improve customer service continued during the quarter. The new cloud-based communication platform, which had already been launched in Estonia and Latvia, was introduced in Lithuania. The platform enables customers to identify themselves and simplifies contacts with Swedbank.
Swedbank continues to show a strong commitment to social engagement. Swedbank's zero-margin campaign for sustainable loans in Estonia and Latvia has been well received and has therefore been extended until the end of the year.
Arbonics, a tech-based carbon and ecosystem platform for forest and landowners in Europe, continued to broaden its offering to the Baltic countries by offering reforestation loans in Lithuania in collaboration with Swedbank. Similar solutions are already in place in Estonia and Latvia.
Jon Lidefelt Head of Baltic Banking
Swedbank is the largest bank by number of customers in Estonia, Latvia and Lithuania, with around 3.4 million private customers and nearly 300 000 corporate customers. According to surveys, Swedbank is also the most loved brand in the Baltic countries. Through digital channels, customer centres and branches, the bank is always available. Swedbank is part of the local community. Local engagement is expressed in many ways, with initiatives to promote education, entrepreneurship and social welfare. Swedbank has 17 branches in Estonia, 21 in Latvia and 45 in Lithuania.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | ||||
|---|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % | 2022 | % | 2023 | 2022 | % |
| Net interest income | 2 685 | 2 567 | 5 | 1 870 | 44 | 7 612 | 4 944 | 54 |
| Net commission income | 776 | 794 | -2 | 739 | 5 | 2 284 | 2 269 | 1 |
| Net gains and losses on financial items | 299 | 363 | -18 | 290 | 3 | 1 059 | 739 | 43 |
| Other income² | 54 | 54 | 1 | 39 | 37 | 169 | 143 | 18 |
| Total income | 3 813 | 3 778 | 1 | 2 939 | 30 | 11 124 | 8 096 | 37 |
| Staff costs | 398 | 407 | -2 | 383 | 4 | 1 224 | 1 179 | 4 |
| Variable staff costs | 26 | 13 | 32 | -19 | 80 | 81 | -1 | |
| Other expenses | 728 | 708 | 3 | 744 | -2 | 2 201 | 2 231 | -1 |
| Depreciation/amortisation | 5 | 6 | -13 | 5 | 2 | 17 | 16 | 9 |
| Total expenses | 1 158 | 1 135 | 2 | 1 164 | -1 | 3 523 | 3 508 | 0 |
| Profit before impairments, bank taxes and | ||||||||
| resolution fees | 2 655 | 2 643 | 0 | 1 775 | 50 | 7 600 | 4 588 | 66 |
| Impairment of intangible assets | 0 | 181 | 181 | |||||
| Credit impairment | -35 | 38 | 251 | 362 | 297 | 22 | ||
| Bank taxes and resolution fees | 208 | 225 | -7 | 137 | 52 | 629 | 410 | 54 |
| Profit before tax | 2 482 | 2 381 | 4 | 1 206 | 6 609 | 3 701 | 79 | |
| Tax expense | 544 | 465 | 17 | 298 | 83 | 1 353 | 848 | 60 |
| Profit for the period | 1 937 | 1 915 | 1 | 908 | 5 256 | 2 853 | 84 | |
| Return on allocated equity, % | 16.0 | 17.3 | 8.5 | 15.3 | 9.5 | |||
| Loan/deposit ratio, % | 166 | 165 | 157 | 166 | 157 | |||
| Credit impairment ratio, % | -0.02 | 0.03 | 0.21 | 0.09 | 0.15 | |||
| Cost/income ratio¹ | 0.30 | 0.30 | 0.40 | 0.32 | 0.43 | |||
| Loans to customers, SEKbn | 475 | 472 | 1 | 428 | 11 | 475 | 428 | 11 |
| Deposits from customers, SEKbn | 285 | 287 | -1 | 273 | 4 | 285 | 273 | 4 |
| Full-time employees | 1 177 | 1 195 | -1 | 1 172 | 0 | 1 177 | 1 172 | 0 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023. For more information see Note 4.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
Stable income with strong net interest income and stable expenses increased profit to SEK 1 937m (1 915).
Net interest income increased to SEK 2 685m (2 567). Higher lending margins and volumes were offset by slightly lower deposit volumes.
Net commission income decreased to SEK 776m (794). Seasonally lower advisory commissions from equityrelated transactions and bond issues were offset by increased commissions from custodial services as well as higher card commissions.
Net gains and losses on financial items decreased to SEK 299m (363) mainly due to lower income from derivative valuation adjustments (CVA/DVA). Higher market valuations in the trading portfolio of corporate bonds had a positive effect, while fixed income and FX trading were stable.
Total expenses increased to SEK 1 158m (1 135). Seasonally lower staff costs were offset by a quarterly effect attributable to the retroactive adjustment made in the second quarter due to the reorganisation between Corporates and Institutions and Group Functions and Other.
Credit impairments amounted to SEK -35m (38). Lower expert credit adjustments as well as lower credit impairment provisions for individually assessed loans due to amortisations of oil and offshore exposures were offset by negative rating and stage migrations.
Profit increased to SEK 5 256m (2 853) largely due to higher net interest income and net gains and losses on financial items.
Net interest income increased to SEK 7 612m (4 944) mainly due to higher deposit margins and higher
average lending volumes. Customer transfers from Swedish Banking had a positive effect.
Net commission income increased to SEK 2 284m (2 269). Increased commissions from asset management as well as the bank's income from electricity price support payments were offset somewhat by lower income from merchant payments. Customer transfers contributed positively.
Net gains and losses on financial items increased to SEK 1 059m (739). The recovery in the market valuation of the trading portfolio of corporate bonds and higher income from fixed income trading contributed positively. Derivative valuation adjustments (CVA/DVA) had a negative effect.
Expenses increased marginally to SEK 3 523m (3 508). Lower IT expenses were offset by higher staff costs due to annual salary increases and restructuring costs.
Credit impairments amounted to SEK 362m (297) and were mainly explained by negative ratings and stage migrations as well as updated macroeconomic scenarios, partly offset by lower expert credit adjustments as well as lower credit impairment provisions for individually assessed loans.
Lending and deposits were both stable during the quarter. Lending to the real estate sector rose slightly. Deposits from institutional clients and the public sector decreased. Corporate deposits also fell slightly, while short-term deposits in foreign currency increased.
Sentiment in the capital markets improved. In the bond market, activity was low during the summer months but rose during the quarter due to lower credit premiums in the secondary market. Investors and issuers have become more closely aligned, including in the real estate sector. Swedbank served as an advisor in connection with share issues by Diös and Humlegården, among other companies. There was also a slight recovery in high-yield bonds issuance, where the bank acted as an advisor to, for instance, Stendörren and Stillfront regarding their issues. Financing activity among banks remained high. We assisted Swedbank Treasury, for example, with issuing a social bond, the
first from a Nordic bank. In addition, we have designed 16 frameworks for sustainable bonds for institutional and corporate clients and arranged nine sustainability events for our clients so far this year.
Demand for share capital from small businesses in order to strengthen their balance sheets increased. Although activity was lower in the real estate sector than in the first half of the year, Swedbank served as an advisor to Logistea in connection with its rights issue. M&A activity also slowed. However, Swedbank served as an advisor on the sale of Hjo installation to Nordic Capital.
There was strong demand from real estate companies for interest rate risk management services as the rising interest rates has made interest rate risk a priority. In the FX business, the level of activity from corporate clients remained high, particularly from exporters, which entered into currency hedges when the Swedish krona weakened.
During the quarter, Swedbank expanded its collaboration with SpareBank 1 Markets to also include the investment grade business. Through this collaboration, Swedbank strengthens its distribution of bonds in Norwegian kroner via SpareBank 1 Markets and is able to offer their customers our expertise in Debt Capital Markets (DCM) for transactions in euro and SEK.
We continued the implementation of our service model for midsized corporate clients, which also includes a more structured way of working with customer plans where we cover client needs in a better way.
To further improve the overall corporate offering, responsibility for all corporate clients who currently have advisors in Swedish Banking will be transferred to Corporates and Institutions. This will be completed by 1 April 2024.
Bo Bengtsson Head of Corporates and Institutions
Corporates and Institutions is responsible for Swedbank's offering to customers with revenues above SEK 2 billion and those with complex needs. The business area is also responsible for corporate and capital market products in other parts of the bank and for the Swedish savings banks. Corporates and Institutions works closely with customers, who receive advice to create long-term profitability and sustainable growth. The business area is represented in Sweden, Estonia, Latvia, Lithuania, Norway, Finland, China and the U.S.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | ||||
|---|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % | 2022 | % | 2023 | 2022 | % |
| Net interest income | -1 078 | -1 044 | 3 | -646 | 67 | -3 065 | 49 | |
| Net commission income | -65 | -113 | -43 | -30 | -235 | -153 | 54 | |
| Net gains and losses on financial items | 128 | -66 | 477 | -73 | 345 | -21 | ||
| Other income² | 840 | 786 | 7 | 620 | 35 | 2 363 | 1 764 | 34 |
| Total income | -175 | -437 | -60 | 421 | -592 | 1 639 | ||
| Staff costs | 1 713 | 1 735 | -1 | 1 642 | 4 | 5 187 | 4 869 | 7 |
| Variable staff costs | 48 | 61 | -22 | 35 | 37 | 172 | 88 | 94 |
| Other expenses | -1 326 | -1 256 | 6 | -1 170 | 13 | -3 835 | -3 583 | 7 |
| Depreciation/amortisation | 427 | 463 | -8 | 361 | 18 | 1 281 | 1 083 | 18 |
| Administrative fines | -40 | 0 | 850 | 0 | ||||
| Total expenses | 862 | 963 | -10 | 868 | -1 | 3 656 | 2 458 | 49 |
| Profit before impairments, bank taxes and | ||||||||
| resolution fees | -1 037 | -1 400 | -26 | -447 | -4 247 | -819 | ||
| Impairment of intangible assets | 11 | 263 #VA | 11 | 263 | ||||
| Credit impairment | 8 | -2 | 1 | 16 | 18 | -12 | ||
| Bank taxes and resolution fees | 6 | 6 | 5 | 20 | 17 | 13 | 29 | |
| Profit before tax | -1 051 | -1 415 | -26 | -715 | 47 | -4 291 | -1 113 | |
| Tax expense | -51 | -165 | -69 | -70 | -27 | -291 | -79 | |
| Profit for the period | -999 | -1 250 | -20 | -645 | 55 | -3 999 | -1 034 | |
| Full-time employees | 7 652 | 7 589 | 1 | 7 429 | 3 | 7 652 | 7 429 | 3 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023 and due to IFRS 17. For more information see Note 4, Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
Net interest income and net gains and losses on financial items mainly stem from Group Treasury. Other income mainly refers to income from the savings banks. Expenses mainly relate to Group Products & Advice and Group Staffs and are allocated to a large extent.
Profit increased to SEK -999m (-1 250). Higher income and lower expenses contributed.
Net interest income decreased to SEK -1 078m (-1 044). Net interest income within Group Treasury increased to SEK -966m (-1 014) due to increased income from the bank's internal pricing model, partly offset by increased financing expenses.
Net gains and losses on financial items increased to SEK 128m (-66). Net gains and losses on financial items within Group Treasury increased to SEK 140m (-56) primarily related to positive valuation adjustments of derivatives and holdings in the liquidity portfolio.
Expenses decreased to SEK 862m (963) mainly due to seasonal effects in Other expenses.
Profit decreased to SEK -3 999m (-1 034) due to lower income and higher expenses.
Net interest income decreased to SEK -3 065m (49). Group Treasury's net interest income decreased to SEK -2 822m (222) due to increased financing expenses as well as the effects of the bank's internal pricing model related to higher market interest rates.
Net gains and losses on financial items increased to SEK 345m (-21). Net gains and losses on financial items within Group Treasury increased to SEK 356m (-11) mainly as a result of positive valuation adjustments of derivatives and in the liquidity portfolio.
Expenses increased to SEK 3 656m (2 458) mainly due to the administrative fine from the Swedish FSA. Higher staff costs also contributed.
Group Functions & Other consists of central business support units and the customer advisory unit Group Products & Advice. The central units serve as strategic and administrative support and comprise Accounting & Finance, Branding, Communication and Sustainability, Risk, Group Channels & Technologies, Compliance, HR & Infrastructure, and Legal. Group Treasury is responsible for the bank's funding, liquidity and capital planning. Group Treasury also sets the prices for all internal deposit and loan flows in the Group through internal interest rates, where the most important parameters are maturity, interest fixing period, currency, and need for liquidity reserves.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |||
|---|---|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | % 2022 |
% | 2023 | 2022 | % |
| Net interest income | 24 | 19 | 21 6 |
59 | 5 | ||
| Net commission income | -5 | -10 | -53 6 |
-17 | 16 | ||
| Other income² | -476 | -464 | 3 -309 |
54 | -1 390 | -918 | 51 |
| Total income | -458 | -455 | 1 -297 |
54 | -1 348 | -897 | 50 |
| Staff costs | -4 | -5 | -29 -3 |
4 | -12 | -11 | 14 |
| Other expenses | -454 | -450 | 1 -293 |
55 | -1 336 | -887 | 51 |
| Total expenses | -458 | -455 | 1 -297 |
54 | -1 348 | -897 | 50 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023 and due to IFRS 17. For more information see Note 4, Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
| Group SEKm |
Q3 2023 |
Q2 2023 |
Q3¹ 2022 |
Jan-Sep 2023 |
Jan-Sep¹ 2022 |
|---|---|---|---|---|---|
| Interest income on financial assets at amortised cost | 27 430 | 24 761 | 11 750 | 73 431 | 27 673 |
| Other interest income | 197 | 106 | 0 | 495 | 178 |
| Interest income | 27 627 | 24 867 | 11 750 | 73 926 | 27 850 |
| Interest expense | -14 726 | -12 099 | -3 392 | -36 322 | -5 622 |
| Net interest income (note 5) | 12 901 | 12 768 | 8 358 | 37 605 | 22 228 |
| Commission income | 6 130 | 6 022 | 5 649 | 17 777 | 16 653 |
| Commission expense | -2 268 | -2 211 | -2 024 | -6 444 | -5 961 |
| Net commission income (note 6) | 3 862 | 3 811 | 3 624 | 11 334 | 10 692 |
| Net gains and losses on financial items (note 7) | 652 | 524 | 963 | 2 093 | 1 176 |
| Insurance result | 945 | -514 | 361 | -75 | 3 423 |
| Return on assets backing insurance liabilities | -619 | 898 | -244 | 1 066 | -3 128 |
| Net insurance income (note 8) | 325 | 384 | 117 | 991 | 295 |
| Share of profit or loss of associates and joint ventures | 265 | 250 | 261 | 685 | 544 |
| Other income | 463 | 435 | 398 | 1 320 | 1 145 |
| Total income | 18 468 | 18 173 | 13 720 | 54 028 | 36 080 |
| Staff costs | 3 429 | 3 417 | 3 191 | 10 312 | 9 465 |
| Other general administrative expenses (note 9) | 1 648 | 1 783 | 1 576 | 5 038 | 4 497 |
| Depreciation/amortisation of tangible and intangible assets | 484 | 520 | 418 | 1 452 | 1 254 |
| Administrative fines | 0 | -3 | 0 | 887 | 0 |
| Total expenses | 5 562 | 5 717 | 5 185 | 17 689 | 15 215 |
| Profit before impairments, bank taxes and resolution fees | 12 906 | 12 456 | 8 535 | 36 339 | 20 865 |
| Impairment of intangible assets (note 15) | 0 | 11 | 443 | 11 | 443 |
| Impairment of tangible assets | 2 | 0 | 10 | 3 | 10 |
| Credit impairment (note 10) | 347 | 188 | 602 | 1 311 | 800 |
| Bank taxes and resolution fees (note 11) | 1 110 | 844 | 466 | 2 472 | 1 392 |
| Profit before tax | 11 447 | 11 414 | 7 014 | 32 542 | 18 220 |
| Tax expense | 2 321 | 2 291 | 1 423 | 6 734 | 3 640 |
| Profit for the period | 9 125 | 9 123 | 5 591 | 25 808 | 14 580 |
| Profit for the period attributable to: | |||||
| Shareholders of Swedbank AB | 9 123 | 9 122 | 5 587 | 25 806 | 14 576 |
| Non-controlling interests | 2 | 1 | 4 | 2 | 4 |
| Earnings per share, SEK | 8.11 | 8.11 | 4.97 | 22.95 | 12.98 |
| Earnings per share after dilution, SEK | 8.09 | 8.09 | 4.96 | 22.90 | 12.95 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
| Group SEKm |
Q3 2023 |
Q2 2023 |
Q3 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
|---|---|---|---|---|---|
| Profit for the period reported via income statement¹ | 9 125 | 9 123 | 5 587 | 25 808 | 14 580 |
| Items that will not be reclassified to the income statement | |||||
| Remeasurements of defined benefit pension plans Share related to associates and joint ventures: |
-429 | 1 338 | 1 956 | 1 221 | 4 547 |
| Remeasurements of defined benefit pension plans | -35 | 43 | 51 | 29 | 166 |
| Income tax | 88 | -276 | -403 | -252 | -937 |
| Total | -375 | 1 105 | 1 604 | 999 | 3 776 |
| Items that may be reclassified to the income statement | |||||
| Exchange rate differences, foreign operations: | |||||
| Gains/losses arising during the period¹ | -1 355 | 2 659 | 719 | 2 214 | 3 050 |
| Hedging of net investments in foreign operations: | |||||
| Gains/losses arising during the period | 1 099 | -2 125 | -567 | -1 700 | -2 402 |
| Cash flow hedges: | |||||
| Gains/losses arising during the period Reclassification adjustments to the income statement, |
-185 | 381 | 98 | 321 | 439 |
| Net gains and losses on financial items | 180 | -373 | -104 | -321 | -435 |
| Foreign currency basis risk: Gains/losses arising during the period Share of other comprehensive income of |
-21 | 1 | 44 | -18 | 112 |
| associates and joint ventures | 1 | 19 | -6 | -18 | 10 |
| Income tax | -221 | 436 | 109 | 354 | 471 |
| Total¹ | -502 | 998 | 293 | 832 | 1 245 |
| Other comprehensive income for the period, net of tax¹ | -877 | 2 103 | 1 897 | 1 831 | 5 021 |
| Total comprehensive income for the period¹ | 8 248 | 11 226 | 7 484 | 27 639 | 19 601 |
| Total comprehensive income attributable to: Shareholders of Swedbank AB¹ |
8 246 | 11 225 | 7 484 | 27 637 | 19 597 |
| Non-controlling interests | 2 | 1 | 0 | 2 | 4 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
For January – September 2023 a gain of SEK 1 221m (4 547) was recognised in other comprehensive income, relating to remeasurements of defined benefit pension plans. As per 30 September 2023 the discount rate used to calculate the closing pension obligation was 4.74 per cent, compared with 4.56 per cent per 31 December 2022. The inflation assumption was 1.83 per cent compared with 2.11 per cent per 31 December 2022. The fair value of plan assets decreased during January – September 2023 by SEK 611m. In total, at 30 September 2023 the fair value of plan assets exceeded the obligation for funded defined benefit pension plans by SEK 3 995m, therefore the funded plans are presented as an asset.
For January – September 2023 an exchange rate difference of SEK 2 214m (3 050) was recognised for the Group's foreign net investments in subsidiaries. The gain related to subsidiaries mainly arose because the Swedish krona weakened against the euro during the period. In addition, an exchange rate difference of SEK - 18m (10) for the Group's foreign net investments in associates and joint ventures is included in Share of other comprehensive income of associates and joint ventures. The total gain of SEK 2 196m is not taxable. Most of the Group's foreign net investments are hedged against currency risk resulting in a loss of SEK -1 700m (-2 402) for the hedging instruments.
| SEKm 2023 2022 2022 Assets Cash and balances with central banks 287 996 365 992 454 584 Treasury bills and other bills eligible for refinancing with central banks, etc. 314 333 151 483 137 794 Loans to credit institutions 53 167 56 589 63 463 Loans to the public 1 867 380 1 842 811 1 845 932 Value change of the hedged assets in portfolio hedges of interest rate risk -15 288 -20 369 -21 691 |
|---|
| Bonds and other interest-bearing securities 52 583 61 298 76 925 |
| Financial assets for which customers bear the investment risk 303 481 268 594 255 830 |
| Shares and participating interests 50 767 30 268 26 868 |
| Investments in associates and joint ventures 8 420 7 830 7 610 |
| Derivatives (note 19) 46 948 50 504 86 985 |
| Intangible assets (note 15) 20 904 19 886 20 047 |
| Tangible assets 5 446 5 449 5 169 |
| Current tax assets 1 608 1 449 2 052 |
| Deferred tax assets 83 159 167 |
| Pension assets 3 995 2 431 3 029 |
| Other assets 14 246 8 244 26 810 |
| Prepaid expenses and accrued income 2 294 2 028 2 296 |
| Total assets 3 018 363 2 854 646 2 993 868 |
| Liabilities and equity |
| Amounts owed to credit institutions (note 16) 98 465 72 826 175 599 |
| Deposits and borrowings from the public (note 17) 1 285 620 1 305 948 1 303 098 |
| Value change of the hedged liabilities in portfolio hedges of interest rate risk 1 0 0 |
| Financial liabilities for which customers bear the investment risk 304 307 268 892 256 151 |
| Debt securities in issue (note 18) 851 482 784 206 826 874 |
| Short positions, securities 19 775 27 134 31 620 |
| Derivatives (note 19) 53 642 68 679 70 674 |
| Current tax liabilities 3 524 1 811 856 |
| Deferred tax liabilities 4 487 3 615 4 822 |
| Pension provisions 142 168 150 |
| Insurance provisions 25 665 24 875 24 022 |
| Other liabilities and provisions 35 834 26 984 35 061 |
| Accrued expenses and prepaid income 5 886 4 657 5 007 |
| Senior non-preferred liabilities (note 18) 103 187 57 439 57 203 |
| Subordinated liabilities (note 18) 33 373 31 331 33 479 |
| Total liabilities 2 825 390 2 678 566 2 824 614 |
| Equity |
| Non-controlling interests 31 29 30 |
| Equity attributable to shareholders of the parent company 192 942 176 052 169 223 |
| Total equity 192 973 176 080 169 253 |
| Total liabilities and equity 3 018 363 2 854 646 2 993 868 |
1) Comparative figures have been restated due to the adoption of IFRS 17. For more information see Note 1 and Note 29.
| Group | Equity attributable to | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEKm | shareholders of Swedbank AB | |||||||||
| January-September 2023 | Share capital |
Other contri- buted equity' |
Exchange differences, subsidiaries and associates |
Hedging of net investments in foreign operations |
Cash hedge |
Foreign flow currency basis reserves reserves |
Retained earnings |
Total | Non- controlling interests |
Total equity |
| Opening balance 1 January 2023 | 24 904 | 17 275 | 9660 | $-5964$ | 11 | -8 | 130 174 | 176 052 | 29 | 176 080 |
| Dividends | $-10964$ | $-10964$ | $-10964$ | |||||||
| Share based payments to employees | 194 | 194 | 194 | |||||||
| Deferred tax related to share based payments to employees |
3 | 3 | 3 | |||||||
| Current tax related to share based payments to employees |
20 | 20 | 20 | |||||||
| Total comprehensive income for the period | 2 1 9 6 | $-1350$ | 0 | $-14$ | 26 805 | 27 637 | $\overline{2}$ | 27 639 | ||
| of which reported through profit or loss of which reported through other |
25 806 | 25 806 | $\overline{c}$ | 25 808 | ||||||
| comprehensive income | 2 1 9 6 | $-1350$ | 0 | $-14$ | 999 | 1831 | 1831 | |||
| Closing balance 30 September 2023 | 24 904 | 17 275 | 11856 | $-7314$ | 11 | $-22$ | 146 232 | 192 942 | 31 | 192 973 |
| January-December 2022 | ||||||||||
| Closing balance 31 December 2021 | 24 904 | 17 275 | 5 2 9 4 | $-3248$ | 2 | -58 | 117 501 | 161 670 | 26 | 161 696 |
| Changes in accounting policies IFRS 17 | 484 | 484 | 484 | |||||||
| Opening balance 1 January 2022 | 24 904 | 17 275 | 5 2 9 4 | $-3248$ | $\mathbf 2$ | $-58$ | 117985 | 162 154 | 26 | 162 180 |
| Dividends | $-12632$ | $-12632$ | $-12632$ | |||||||
| Share based payments to employees | 174 | 174 | 174 | |||||||
| Deferred tax related to share based payments to employees |
4 | 4 | 4 | |||||||
| Current tax related to share based payments to employees |
$-1$ | -1 | -1 | |||||||
| Total comprehensive income for the period | 4 3 6 6 | -2716 | 9 | 50 | 24 644 | 26 353 | 3 | 26 356 | ||
| of which reported through profit or loss | 21 3 65 | 21 365 | 3 | 21 368 | ||||||
| of which reported through other comprehensive income |
4 3 6 6 | $-2716$ | 9 | 50 | 3 2 7 9 | 4988 | 4988 | |||
| Closing balance 31 December 2022 | 24 904 | 17 275 | 9660 | $-5964$ | 11 | -8 | 130 174 | 21 365 | 29 | 21 368 |
| January-September 2022 | ||||||||||
| Closing balance 31 December 2021 | 24 904 | 17 275 | 5 2 9 4 | $-3248$ | $\mathbf{2}$ | -58 | 117 501 | 161 670 | 26 | 161 696 |
| Changes in accounting policies IFRS 17 | 484 | 484 | 484 | |||||||
| Opening balance 1 January 2022 | 24 904 | 17 275 | 5 2 9 4 | $-3248$ | $\mathbf{2}$ | -58 | 117985 | 162 154 | 26 | 162 180 |
| Dividends | $-12632$ | $-12632$ | $-12632$ | |||||||
| Share based payments to employees | 113 | 113 | 113 | |||||||
| Deferred tax related to share based payments to employees |
$-7$ | -7 | $-7$ | |||||||
| Current tax related to share based payments to employees |
$-1$ | -1 | -1 | |||||||
| Total comprehensive income for the period | 3 0 6 0 | $-1907$ | 3 | 89 | 18 352 | 19 597 | 19 601 | |||
| of which reported through profit or loss | 14 576 | 14 576 | 14 580 | |||||||
| of which reported through other comprehensive income |
3 0 6 0 | $-1907$ | 3 | 89 | 3776 | 5 0 2 1 | 5 0 2 1 | |||
| Closing balance 30 September 2022 | 24 904 | 17 275 | 8 3 5 4 | -5 155 | 5 | 31 | 123810 | 169 224 | 30 | 169 254 |
| Group | Jan-Sep | Full year | Jan-Sep |
|---|---|---|---|
| SEKm | 2023 | 2022 | 2022 |
| Operating activities | |||
| Profit before tax¹ | 32 542 | 26 763 | 18 220 |
| Adjustments for non-cash items in operating activities¹ | 174 | 3 395 | -88 |
| Income taxes paid | -5 178 | -4 537 | -4 044 |
| Increase (-) / decrease (+) in loans to credit institution | 4 589 | -16 637 | -23 801 |
| Increase (-) / decrease (+) in loans to the public | -16 169 | -123 486 | -133 139 |
| Increase (-) / decrease (+) in holdings of securities | -170 404 | 16 856 | 15 007 |
| Increase (-) / decrease (+) in other assets | -8 150 | -6 593 | -60 247 |
| Increase (+) / decrease (-) in amounts owed to credit institutions | 20 904 | -25 043 | 79 547 |
| Increase (+) / decrease (-) in deposits and borrowings from the public | -35 306 | 11 707 | 20 785 |
| Increase (+) / decrease (-) in debt securities in issue | 34 404 | 22 722 | 49 082 |
| Increase (+) / decrease (-) in other liabilities | 26 748 | 76 233 | 112 346 |
| Cash flow from operating activities | -115 846 | -18 620 | 73 668 |
| Investing activities | |||
| Acquisitions of and contributions to associates and joint ventures | -53 | -135 | -118 |
| Dividend from associates and joint ventures | 113 | 1 020 | 1 020 |
| Acquisitions of other fixed assets and strategic financial assets | -654 | -363 | -243 |
| Disposals of/maturity of other fixed assets and strategic financial assets | 118 | 169 | 92 |
| Cash flow from investing activities | -476 | 691 | 751 |
| Financing activities | |||
| Amortisation of lease liabilities | -603 | -802 | -581 |
| Issuance of senior non-preferred liablities | 45 397 | 22 993 | 22 447 |
| Redemption of senior non-preferred liablities | -1 447 | -257 | -86 |
| Issuance of subordinated liabilities | 9 339 | 13 374 | 8 419 |
| Redemption of subordinated liabilities | -10 070 | -12 661 | -5 523 |
| Dividends paid | -10 964 | -12 632 | -12 632 |
| Cash flow from financing activities | 31 652 | 10 015 | 12 044 |
| Cash flow for the period | -84 670 | -7 914 | 86 463 |
| Cash and cash equivalents at the beginning of the period | 365 992 | 360 153 | 360 153 |
| Cash flow for the period | -84 670 | -7 914 | 86 463 |
| Exchange rate differences on cash and cash equivalents | 6 674 | 13 753 | 7 968 |
| Cash and cash equivalents at end of the period | 287 996 | 365 992 | 454 584 |
1) Comparative figures have been restated due to the adoption of IFRS 17. The real cash flow is not affected by the adoption, but amounts for relevant lines have been restated.
During the year contributions were provided to the joint ventures P27 Nordic Payments Platform AB, Invidem AB and Tibern AB of SEK 48m, 3m and 2m respectively.
During the year contributions were provided to the joint ventures P27 Nordic Payments Platform AB, Invidem AB and Tibern AB of SEK 72m, 49m and 3m respectively. During the second quarter shares were acquired in the associate Thylling Insight AB of SEK 11m.
The interim report has been prepared in accordance with IAS 34 Interim Financial Reporting. The condensed consolidated financial statements have also been prepared in accordance with the recommendations and statements of the Swedish Financial Reporting Board, the Annual Accounts Act for Credit Institutions and Securities Companies and the directives of the Swedish Financial Supervisory Authority (SFSA).
The Parent Company report has been prepared in accordance with the Annual Accounts Act for Credit Institutions and Securities Companies, the directives of the SFSA and recommendation RFR 2 of the Swedish Financial Reporting Board.
The accounting policies applied in the interim report conform to those applied in the Annual and Sustainability Report for 2022, which was prepared in accordance with International Financial Reporting Standards as adopted by the European Union and interpretations thereof. Other than as described below, there have been no significant changes to the Group's accounting policies.
The financial statements are presented in Swedish kronor and all figures are rounded to millions of kronor (SEKm) unless otherwise indicated. No adjustments for rounding are made, therefore summation differences may occur.
The following new accounting pronouncements have been applied in the financial reports during 2023.
On 1 January 2023, the Group adopted IFRS 17 Insurance contracts. IFRS 17 replaces IFRS 4 Insurance contracts and sets out the principles for recognition, presentation, measurement, and disclosure of insurance contracts issued and reinsurance contracts. The key differences between IFRS 17 and IFRS 4 relate to revenue recognition and liability valuation. The new standard has been applied with
Presentation of consolidated financial statements in conformity with IFRS requires the executive management to make judgments and estimates that affect the recognised amounts of assets, liabilities and disclosures of contingent assets and liabilities as of the reporting date as well as the recognised income and expenses during the reporting period. The executive management continuously evaluates these judgments and estimates, including assessing control over investment funds, the fair value of financial instruments, provisions for credit impairment, impairment testing of goodwill, deferred taxes and defined benefit pension provisions.
No significant changes to the Group structure occurred during the first nine months of 2023.
The related accounting policies applied from 1 January 2023 are set out in the 2022 Annual and Sustainability Report on pages 78-79.
Fair value hedge accounting – portfolio hedges Fair value portfolio hedge accounting for non-maturing deposits, consisting of on demand deposits, was initiated during Q3. The interest rate exposure in nonmaturing deposits is hedged with derivatives. The Group applies fair value portfolio hedge accounting in accordance with the EU carve-out version of IAS 39, which permits on demand deposits to be designated as hedged items. Hedge ineffectiveness for portfolio hedges is not recognised due to differences in expected versus actual repricing dates given that only a portion of the portfolio is hedged.
The fair value of the hedged items is recognised on a separate line in the balance sheet: Value change of hedged liabilities in portfolio hedges of interest rate risk. Both the fair value changes of the derivative and the fair value changes of the hedged risk are recognised in the income statement within Net gains and losses on financial items. Interests from the hedged items and the hedging instruments are recognised within Net interest income.
Other amended regulations that have been adopted from 1 January 2023 did not have a significant impact on the Group's financial position, results, cash flows or disclosures.
Post-model expert credit adjustments to the credit impairment provisions continue to be necessary, given the geopolitical and economic uncertainties. Additionally, as per 30 September 2023, the significant increase in credit risk threshold for the Swedish mortgage portfolio was amended. Further information is provided in Note 10. Beyond that, there have been no significant changes to the basis upon which the critical accounting judgments and estimates have been determined compared with 31 December 2022.
| Group | ||||||
|---|---|---|---|---|---|---|
| January-September 2023 | Swedish | Baltic | Corporates and | Functions | ||
| SEKm | Banking | Banking | Institutions | and Other | Eliminations | Group |
| Income statement | ||||||
| Net interest income | 19 493 | 13 506 | 7 612 | -3 065 | 59 | 37 605 |
| Net commission income | 6 758 | 2 543 | 2 284 | -235 | -17 | 11 334 |
| Net gains and losses on financial items | 283 | 407 | 1 059 | 345 | -0 | 2 093 |
| Other income¹ Total income |
1 266 27 800 |
589 17 045 |
169 11 124 |
2 363 -592 |
-1 390 -1 348 |
2 997 54 028 |
| Staff costs | 2 086 | 1 459 | 1 224 | 5 187 | -12 | 9 944 |
| Variable staff costs | 43 | 73 | 80 | 172 | 0 | 368 |
| Other expenses | 5 691 | 2 316 | 2 201 | -3 835 | -1 336 | 5 038 |
| Depreciation/amortisation | 14 | 139 | 17 | 1 281 | -0 | 1 452 |
| Administrative fines | 37 | 850 | 887 | |||
| Total expenses | 7 834 | 4 025 | 3 523 | 3 656 | -1 348 | 17 689 |
| Profit before impairments, bank taxes and resolution | ||||||
| fees | 19 966 | 13 020 | 7 600 | -4 247 | -0 | 36 339 |
| Impairment of intangible assets | 11 | 11 | ||||
| Impairment of tangible assets | 3 | 3 | ||||
| Credit impairment | 822 | 111 | 362 | 16 | -0 | 1 311 |
| Bank taxes and resolution fees | 832 | 994 | 629 | 17 | -0 | 2 472 |
| Profit before tax | 18 312 | 11 912 | 6 609 | -4 291 | 0 | 32 542 |
| Tax expense | 3 524 | 2 148 | 1 353 | -291 | 0 | 6 734 |
| Profit for the period | 14 788 | 9 764 | 5 256 | -3 999 | 0 | 25 808 |
| Profit for the period attributable to: | ||||||
| Shareholders of Swedbank AB Non-controlling interests |
14 785 2 |
9 764 | 5 256 | -3 999 | 0 | 25 806 2 |
| Net commission income | ||||||
| Commission income | ||||||
| Payment processing | 460 | 507 | 596 | 314 | -13 | 1 865 |
| Cards | 1 820 | 1 708 | 2 166 | -338 | 0 | 5 356 |
| Asset management and custody | 5 425 | 449 | 1 412 | -3 | -244 | 7 038 |
| Lending | 25 | 178 | 720 | 5 | -6 | 921 |
| Other commission income² | 1 418 | 463 | 728 | 8 | -20 | 2 597 |
| Total Commission income | 9 148 | 3 304 | 5 622 | -14 | -282 | 17 777 |
| Commission expense | 2 390 | 761 | 3 337 | 220 | -265 | 6 444 |
| Net commission income | 6 758 | 2 543 | 2 284 | -235 | -17 | 11 334 |
| Balance sheet, SEKbn | ||||||
| Cash and balances with central banks | 0 | 4 | 1 | 284 | 0 | 288 |
| Loans to credit institutions | 6 | 0 | 173 | 296 | -422 | 53 |
| Loans to the public | 1 072 | 261 | 535 | 1 | -1 | 1 867 |
| Interest-bearing securities | 2 | 61 | 307 | -3 | 367 | |
| Financial assets for which customers bear the investment | ||||||
| risk | 301 | 2 | 303 | |||
| Investments in associates and joint ventures | 6 | 2 | 8 | |||
| Derivatives | 0 | 157 | 133 | -244 | 47 | |
| Tangible and intangible assets | 2 | 13 | -0 | 11 | 0 | 26 |
| Other assets Total assets |
22 1 410 |
132 414 |
31 958 |
250 1 284 |
-378 -1 048 |
58 3 018 |
| Amounts owed to credit institutions | 8 | 0 | 385 | 119 | -413 | 98 |
| Deposits and borrowings from the public | 613 | 376 | 301 | 4 | -9 | 1 286 |
| Debt securities in issue | -0 | 3 | 2 | 850 | -3 | 851 |
| Financial liabilities for which customers bear the | ||||||
| investment risk | 302 | 2 | 304 | |||
| Derivatives | 0 | 171 | 127 | -244 | 54 | |
| Other liabilities | 423 | 0 | 52 | -0 | -379 | 95 |
| Senior non-preferred liabilities | -0 | 103 | 0 | 103 | ||
| Subordinated liabilities | -0 | 33 | 0 | 33 | ||
| Total liabilities | 1 346 | 382 | 909 | 1 237 | -1 048 | 2 825 |
| Allocated equity | 64 | 33 | 49 | 47 | 193 | |
| Total liabilities and equity | 1 410 | 414 | 958 | 1 284 | -1 048 | 3 018 |
| Key figures | ||||||
| Return on allocated equity, % | 30.8 | 41.4 | 15.3 | -13.0 | 0.0 | 18.9 |
| Cost/income ratio | 0.28 | 0.24 | 0.32 | -6.18 | 0.00 | 0.33 |
| Credit impairment ratio, % | 0.10 | 0.06 | 0.09 | 0.07 | 0.00 | 0.09 |
| Loan/deposit ratio, % | 176 | 69 | 166 | 15 | 0 | 142 |
| Lending to the public, stage 3, SEKbn (gross) | 3 | 2 | 2 | 0 | 0 | 7 |
| Loans to customers, total, SEKbn | 1 072 | 260 | 475 | 1 | 0 | 1 808 |
| Provisions for loans to customers, total, SEKbn | 2 | 1 | 3 | 0 | 0 | 7 |
| Deposits from customers, SEKbn | 610 | 376 | 285 | 6 | 0 | 1 278 |
| Risk exposure amount, SEKbn | 355 | 176 | 277 | 29 | 0 | 838 |
| Full-time employees | 3 444 | 4 738 | 1 177 | 7 652 | 0 | 17 011 |
| Allocated equity, average, SEKbn | 64 | 31 | 46 | 41 | 0 | 182 |
1) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
2) Other commission income includes Service concepts, Insurance, Securities and corporate finance and Other, see Note 6.
| Group | ||||||
|---|---|---|---|---|---|---|
| January-September 2022¹ | Swedish | Baltic | Corporates and | Functions | ||
| SEKm | Banking | Banking | Institutions | and Other | Eliminations | Group |
| Income statement | ||||||
| Net interest income | 12 132 | 5 098 | 4 944 | 49 | 5 | 22 228 |
| Net commission income | 6 377 | 2 183 | 2 269 | -153 | 16 | 10 692 |
| Net gains and losses on financial items | 154 | 304 | 739 | -21 | 0 | 1 176 |
| Other income² | 1 211 | -216 | 143 | 1 764 | -918 | 1 984 |
| Total income | 19 875 | 7 369 | 8 096 | 1 639 | -897 | 36 080 |
| Staff costs | 2 053 | 1 145 | 1 179 | 4 869 | -11 | 9 235 |
| Variable staff costs | 20 | 40 | 81 | 88 | -0 | 229 |
| Other expenses | 5 037 | 1 698 | 2 231 | -3 583 | -887 | 4 497 |
| Depreciation/amortisation | 21 | 134 | 16 | 1 083 | 1 254 | |
| Total expenses | 7 130 | 3 017 | 3 508 | 2 458 | -897 | 15 215 |
| Profit before impairments, bank taxes and resolution | ||||||
| fees | 12 745 | 4 352 | 4 588 | -819 | -0 | 20 865 |
| Impairment of intangible assets | 181 | 263 | 443 | |||
| Impairment of tangible assets | 10 | 10 | ||||
| Credit impairment | 366 | 118 | 297 | 18 | -0 | 800 |
| Bank taxes and resolution fees | 895 | 74 | 410 | 13 | 1 392 | |
| Profit before tax | 11 483 | 4 149 | 3 701 | -1 113 | 0 | 18 220 |
| Tax expense | 2 144 | 728 | 848 | -79 | 3 640 | |
| Profit for the period | 9 340 | 3 422 | 2 853 | -1 034 | 0 | 14 580 |
| Profit for the period attributable to: | ||||||
| Shareholders of Swedbank AB | 9 336 | 3 422 | 2 853 | -1 034 | 0 | 14 576 |
| Non-controlling interests | 4 | 4 | ||||
| Net commission income | ||||||
| Commission income | ||||||
| Payment processing | 417 | 488 | 468 | 263 | -12 | 1 624 |
| Cards | 1 716 | 1 456 | 2 092 | -353 | 0 | 4 910 |
| Asset management and custody | 5 193 | 400 | 1 213 | -12 | -219 | 6 576 |
| Lending | 88 | 146 | 722 | 9 | -5 | 960 |
| Other commission income³ | 1 452 | 367 | 769 | 0 | -6 | 2 582 |
| Total Commission income | 8 866 | 2 857 | 5 265 | -93 | -242 | 16 653 |
| Commission expense | 2 489 | 674 | 2 996 | 59 | -258 | 5 961 |
| Net commission income | 6 377 | 2 183 | 2 269 | -153 | 16 | 10 692 |
| Balance sheet, SEKbn | ||||||
| Cash and balances with central banks | 2 | 4 | 2 | 448 | -1 | 455 |
| Loans to credit institutions | 4 | 0 | 142 | 269 | -352 | 63 |
| Loans to the public | 1 141 | 227 | 476 | 2 | -1 | 1 846 |
| Interest-bearing securities | 0 | 2 | 72 | 143 | -2 | 215 |
| Financial assets for which customers bear the investment | ||||||
| risk | 254 | 2 | 256 | |||
| Investments in associates | 5 | 2 | 8 | |||
| Derivatives | 0 | 1 | 206 | 175 | -294 | 87 |
| Tangible and intangible assets | 2 | 12 | -0 | 11 | -0 | 25 |
| Other assets | 22 | 127 | 14 | 366 | -489 | 40 |
| Total assets | 1 430 | 374 | 912 | 1 417 | -1 139 | 2 994 |
| Amounts owed to credit institutions | 8 | 0 | 350 | 147 | -329 | 176 |
| Deposits and borrowings from the public | 658 | 342 | 307 | 4 | -8 | 1 303 |
| Debt securities in issue | -0 | 2 | 3 | 825 | -3 | 827 |
| Financial liabilities for which customers bear the | ||||||
| investment risk | 254 | 2 | 256 | |||
| Derivatives | 1 | 216 | 148 | -294 | 71 | |
| Other liabilities | 446 | 0 | -8 | 168 | -505 | 102 |
| Senior non-preferred liabilities | 57 | 57 | ||||
| Subordinated liabilities | -0 | 33 | 33 | |||
| Total liabilities | 1 366 | 347 | 868 | 1 383 | -1 139 | 2 825 |
| Allocated equity | 64 | 27 | 44 | 34 | 169 | |
| Total liabilities and equity | 1 430 | 374 | 912 | 1 417 | -1 139 | 2 994 |
| Key figures | ||||||
| Return on allocated equity, % | 19.8 | 17.1 | 9.5 | -4.3 | 0.0 | 12.0 |
| Cost/income ratio | 0.36 | 0.41 | 0.43 | 1.50 | 0.00 | 0.42 |
| Credit impairment ratio, % | 0.04 | 0.08 | 0.15 | 0.13 | 0.00 | 0.06 |
| Loan/deposit ratio, % | 174 | 66 | 157 | 45 | #VALUE! | 141 |
| Lending to the public, stage 3, SEKbn (gross) | 3 | 1 | 3 | 6 | ||
| Loans to customers, total, SEKbn | 1 141 | 227 | 428 | 2 | 0 | 1 798 |
| Provisions for loans to customers, total, SEKbn | 2 | 1 | 3 | 5 | ||
| Deposits from customers, SEKbn | 658 | 342 | 273 | 4 | 0 | 1277 |
| Risk exposure amount, SEKbn | 365 | 125 | 233 | 30 | 0 | 753 |
| Full-time employees | 3 508 | 4 702 | 1 172 | 7 429 | 0 | 16 811 |
| Allocated equity, average, SEKbn | 63 | 27 | 40 | 32 | 0 | 162 |
1) Comparative figures have been restated due to the reorganisation as per 1 May 2023 and due to IFRS 17. For more information see Note 1 and Note 29.
2) Other income includes the items Net insurance, Share of profit or loss of associates and joint ventures and Other income from the Group income statement.
3) Other commission income includes Service concepts, Insurance, Securities and corporate finance and Other, see Note 6.
The operating segment report is based on Swedbank's accounting policies, organisation and management accounts. Market-based transfer prices are applied between operating segments, while all expenses for Group functions and Group staffs are transfer priced at cost to the operating segments. Cross-border transfer pricing is applied according to OECD transfer pricing guidelines.
The Group's equity attributable to shareholders is allocated to each operating segment based on capital adequacy rules and estimated capital requirements based on the bank's Internal Capital Adequacy Assessment Process (ICAAP).
The return on allocated equity for the operating segments is calculated based on profit for the period attributable to the shareholders for the operating segment, in relation to average monthly allocated equity for the operating segment. For periods shorter than one year the key ratio is annualised.
From 1 May 2023, Swedbank completed a reorganisation which mainly impacts Swedish Banking, Large Corporates and Institutions, which changed name to Corporates and Institutions, and Group Functions and Other. The majority of mid-sized corporate customers and tenant-owned associations were transferred from Swedish Banking to Corporates and Institutions. In connection with the change, certain support functions have also been transferred to Group Functions and Other. The comparative figures have been restated. Further transfers of customers between business areas have also occurred since 1 May. Restatements have not been made for these transfers. These changes have no impact on the Group's total profit or equity.
The comparative figures have also been restated due to the adoption of IFRS 17. For more information, see Note 1 and Note 29.
| Group | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| January-September 2022 | Swedish | Baltic | Corporates and | Functions | ||||||||
| SEKm | Banking | Banking | Institutions | and Other | Eliminations | Group | ||||||
| IFRS 17 | Reorg | IFRS 17 | Reorg | IFRS 17 | Reorg | IFRS 17 | Reorg | IFRS 17 | Reorg | IFRS 17 | Reorg | |
| Income statement | ||||||||||||
| Net interest income | $-1540$ | $-7$ | $\mathbf 0$ | 1556 | $-15$ | $-7$ | ||||||
| Net commission income | $-21$ | $-225$ | $-50$ | 205 | $-10$ | 20 | $-2$ | $-83$ | ||||
| Net gains and losses on financial items | 14 | $-102$ | 38 | 105 | $-2$ | 52 | ||||||
| Other income 2 | $-168$ | -4 | $-842$ | $-25$ | $-9$ | 30 | 41 | $-978$ | ||||
| Total income | $-175$ | $-1872$ | $-862$ | $\pmb{\mathsf{o}}$ | 1840 | -19 | 31 | 39 | $-1017$ | |||
| Staff costs | $-62$ | $-350$ | $-169$ | 21 | $-75$ | 329 | $-305$ | |||||
| Variable staff costs | $-5$ | $-0$ | $-1$ | $-1$ | 6 | $-1$ | ||||||
| Other expenses | $-164$ | $-350$ | $-75$ | -0 | 458 | 57 | $-108$ | 39 | $-143$ | |||
| Depreciation/amortisation | $-0$ | $-73$ | 73 | |||||||||
| Total expenses | $-225$ | $-704$ | $-245$ | -0 | 404 | $-19$ | 300 | 39 | $-450$ | |||
| Profit before impairments, bank taxes and resolutior | ||||||||||||
| fees | 50 | $-1168$ | $-617$ | 0 | 1436 | $\mathbf 0$ | $-269$ | $-567$ | ||||
| Credit impairment | $-194$ | 194 | ||||||||||
| Bank taxes and resolution fees | $-55$ | 55 | ||||||||||
| Profit before tax | 50 | $-918$ | $-617$ | $\mathbf 0$ | 1 1 8 7 | $-269$ | $-567$ | |||||
| Tax expense | 9 | $-195$ | $-88$ | $\mathbf{0}$ | 254 | $-59$ | $-79$ | |||||
| Profit for the period | 41 | $-723$ | $-530$ | $\mathbf{0}$ | 933 | $-210$ | $-488$ | |||||
| Profit for the period attributable to: | ||||||||||||
| Shareholders of Swedbank AB | 41 | $-723$ | $-530$ | $\pmb{0}$ | 933 | $-210$ | $-488$ | |||||
| Net commission income | ||||||||||||
| Commission income | ||||||||||||
| Payment processing | $-164$ | 94 | 70 | |||||||||
| Cards | $-177$ | 177 | ||||||||||
| Asset management and custody | $-18$ | 18 | ||||||||||
| Lending | $-56$ | 56 | ||||||||||
| Other commission income 3 | $-79$ | $-65$ | $-58$ | 65 | $-0$ | $-137$ | ||||||
| Total Commission income | $-79$ | $-480$ | $-58$ | 410 | 70 | $-137$ | ||||||
| Commission expense | $-58$ | $-255$ | -8 | 205 | 10 | 50 | $\mathbf 2$ | $-53$ | ||||
| Net commission income | $-21$ | $-225$ | $-50$ | 205 | $-10$ | 20 | $-2$ | $-83$ | ||||
| Balance sheet, SEKbn | ||||||||||||
| Cash and balances with central banks | $-1$ | $\overline{2}$ | $-1$ | |||||||||
| Loans to credit institutions | $-2$ | $\overline{1}$ | 1 | |||||||||
| Loans to the public | $-139$ | 139 | ||||||||||
| Financial assets for which customers bear the | $-16$ | $-5$ | $-21$ | |||||||||
| investment risk | $\mathbf{1}$ | |||||||||||
| Tangible and intangible assets | $-1$ | 1 | ||||||||||
| Other assets | 16 | -0 | $-0$ | $-1$ | 5 | 21 | ||||||
| Total assets | $-142$ | $-5$ | 141 | $\mathbf 0$ | 5 | 1 | $-0$ | |||||
| Amounts owed to credit institutions | $-22$ | 22 | ||||||||||
| Deposits and borrowings from the public Financial liabilities for which customers bear the |
$-76$ | 76 | ||||||||||
| investment risk | $-17$ | $-5$ | $-22$ | |||||||||
| Other liabilities | 17 | $-37$ | $-0$ | 36 | $-0$ | 5 | 1 | 22 | ||||
| Total liabilities | $-135$ | -5 | 134 | -0 | 5 | 1 | -0 | |||||
| Allocated equity | $-7$ | $\overline{7}$ | $\mathbf{1}$ | |||||||||
| Total liabilities and equity | $-142$ | $-5$ | 141 | $\pmb{0}$ | 5 | 1 | -0 | |||||
| Key figures | ||||||||||||
| 0.0 | 0.5 | $-2.6$ | 0.0 | 2.0 | 0.0 | $-0.8$ | 0.0 | 0.0 | ||||
| Return on allocated equity, % | ||||||||||||
| Cost/income ratio | $-0.01$ | 0.00 | 0.01 | 0.00 | $-0.06$ | 0.00 | 0.16 | 0.00 | ||||
| Credit impairment ratio, % | $-0.02$ | 0.10 | ||||||||||
| Loan/deposit ratio, % | $-1$ | 10 | ||||||||||
| Loans to customers, total, SEKbn | $-139$ | 139 | ||||||||||
| Deposits from customers, SEKbn | $-76$ | 76 | ||||||||||
| Risk exposure amount, SEKbn | $-43$ | 43 | ||||||||||
| Full-time employees | $-546$ | $-29$ | 574 | |||||||||
| Allocated equity, average, SEKbn | -7 | 6 | 1 | |||||||||
| SEKm | Q3 2023 |
Q2 2023 |
Q3¹ 2022 |
Jan-Sep 2023 |
Jan-Sep¹ 2022 |
|---|---|---|---|---|---|
| Interest income | |||||
| Cash and balances with central banks | 4 329 | 3 954 | 1 020 | 11 689 | 654 |
| Treasury bills and other bills eligible for refinancing with central banks, etc. | 2 418 | 2 207 | 253 | 6 038 | 460 |
| Loans to credit institutions | 954 | 799 | 185 | 2 444 | 294 |
| Loans to the public | 21 490 | 19 225 | 10 532 | 57 484 | 26 712 |
| Bonds and other interest-bearing securities | 413 | 474 | 280 | 1 276 | 528 |
| Derivatives² | -108 | -182 | 139 | -416 | 449 |
| Other assets | 25 | 17 | 2 | 53 | 3 |
| Total | 29 522 | 26 494 | 12 411 | 78 569 | 29 100 |
| Deduction of trading-related interests reported in Net gains and losses on financial items |
1 895 | 1 627 | 661 | 4 642 | 1 250 |
| Total interest income | 27 627 | 24 867 | 11 750 | 73 926 | 27 850 |
| Interest expense | |||||
| Amounts owed to credit institutions | -1 743 | -1 656 | -355 | -4 686 | -354 |
| Deposits and borrowings from the public | -7 470 | -6 210 | -1 447 | -18 364 | -1 928 |
| of which deposit guarantee fees | -188 | -183 | -155 | -528 | -467 |
| Debt securities in issue | -7 221 | -6 718 | -3 035 | -19 799 | -5 837 |
| Senior non-preferred liabilities | -717 | -483 | -148 | -1 577 | -362 |
| Subordinated liabilities | -505 | -453 | -212 | -1 332 | -611 |
| Derivatives² | 968 | 1 625 | 1 508 | 4 457 | 3 183 |
| Other liabilities | -19 | -16 | -12 | -56 | -38 |
| Total | -16 708 | -13 911 | -3 702 | -41 358 | -5 947 |
| Deduction of trading-related interests reported in Net gains and losses on financial items |
-1 982 | -1 812 | -309 | -5 037 | -325 |
| Total interest expense | -14 726 | -12 099 | -3 392 | -36 322 | -5 622 |
| Net interest income | 12 901 | 12 768 | 8 358 | 37 605 | 22 228 |
| Net investment margin before trading-related interests are deducted | 1.67 | 1.62 | 1.16 | 1.61 | 1.02 |
| Average total assets | 3 077 676 3 084 882 | 3 012 361 | 3 084 882 | 3 015 224 | |
| Interest expense on financial liabilities at amortised cost | 16 267 | 14 910 | 5 090 | 43 277 | 9 026 |
1) Comparative figures have been restated due to the adoption of IFRS 17.
2) Derivatives include net interest income related to hedged assets and liabilities. These may have both a positive and negative impact on interest income and interest expense.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Commission income | |||||
| Payment processing | 629 | 635 | 548 | 1 865 | 1 624 |
| Cards | 1 909 | 1 867 | 1 807 | 5 356 | 4 910 |
| Service concepts | 408 | 401 | 362 | 1 200 | 1 074 |
| Asset management and custody | 2 453 | 2 363 | 2 137 | 7 038 | 6 576 |
| Insurance | 70 | 77 | 96 | 233 | 324 |
| Securities and corporate finance | 126 | 167 | 161 | 493 | 531 |
| Lending | 314 | 311 | 325 | 921 | 960 |
| Other | 221 | 201 | 212 | 672 | 654 |
| Total commission income | 6 130 | 6 022 | 5 649 | 17 777 | 16 653 |
| Commission expense | |||||
| Payment processing | -402 | -415 | -327 | -1 182 | -1 030 |
| Cards | -923 | -865 | -873 | -2 496 | -2 404 |
| Service concepts | -44 | -43 | -42 | -134 | -130 |
| Asset management and custody | -648 | -626 | -532 | -1 852 | -1 622 |
| Insurance | -75 | -76 | -60 | -220 | -219 |
| Securities and corporate finance | -85 | -100 | -85 | -279 | -266 |
| Lending | -33 | -25 | -41 | -99 | -120 |
| Other | -58 | -60 | -64 | -182 | -172 |
| Total commission expense | -2 268 | -2 211 | -2 024 | -6 444 | -5 961 |
| Net commission income | |||||
| Payment processing | 226 | 219 | 221 | 683 | 594 |
| Cards | 986 | 1 002 | 934 | 2 860 | 2 507 |
| Service concepts | 364 | 357 | 320 | 1 066 | 944 |
| Asset management and custody | 1 805 | 1 737 | 1 605 | 5 186 | 4 954 |
| Insurance | -5 | 1 | 35 | 13 | 105 |
| Securities and corporate finance | 42 | 67 | 76 | 214 | 265 |
| Lending | 281 | 286 | 285 | 822 | 841 |
| Other | 163 | 141 | 148 | 490 | 482 |
| Total net commission income | 3 862 | 3 811 | 3 624 | 11 334 | 10 692 |
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Fair value through profit or loss | |||||
| Shares and share related derivatives | 89 | 25 | 87 | 101 | 623 |
| of which dividend | 6 | 60 | 4 | 155 | 117 |
| Interest-bearing securities and interest related derivatives | 255 | 380 | 27 | 1 106 | -1 681 |
| Financial liabilities | 2 | 2 | 8 | 3 | 24 |
| Financial assets and liabilities where the customers bear the investment risk, net |
-4 | 2 | 7 | -2 | 14 |
| Other financial instruments | -1 | 0 | 1 | -1 | -1 |
| Total fair value through profit or loss | 341 | 408 | 131 | 1 207 | -1 020 |
| Hedge accounting | |||||
| Ineffectiveness, one-to-one fair value hedges | 47 | -72 | 119 | 61 | 26 |
| of which hedging instruments | 1 178 | -3 441 | -10 134 | 1 413 | -33 905 |
| of which hedged items | -1 130 | 3 369 | 10 253 | -1 351 | 33 932 |
| Ineffectiveness, portfolio fair value hedges | -9 | 45 | 79 | 119 | 7 |
| of which hedging instruments | -2 263 | 200 | 3 160 | -4 961 | 19 945 |
| of which hedged items | 2 254 | -155 | -3 081 | 5 080 | -19 938 |
| Ineffectiveness, cash flow hedges | 0 | -1 | -1 | -2 | 1 |
| Total hedge accounting | 38 | -27 | 197 | 178 | 34 |
| Amortised cost | |||||
| Derecognition gain or loss for financial assets | 13 | 17 | 7 | 41 | 5 |
| Derecognition gain or loss for financial liabilities | -2 | 11 | 143 | 18 | 358 |
| Total amortised cost | 11 | 28 | 150 | 59 | 363 |
| Trading related interest | |||||
| Interest income | 1 895 | 1 627 | 661 | 4 642 | 1 250 |
| Interest expense | -1 982 | -1 812 | -309 | -5 037 | -325 |
| Total trading related interest | -87 | -186 | 352 | -394 | 925 |
| Change in exchange rates | 350 | 301 | 134 | 1 043 | 874 |
| Total | 652 | 524 | 963 | 2 093 | 1 176 |
Due to the adoption of IFRS 17 a note disclosing Net insurance income is reported, in accordance with the standard.
| Q3 | Q2 | Q3 | Jan-Sep | Jan-Sep | |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Insurance service revenue | 1 100 | 1 060 | 931 | 3 203 | 2 680 |
| Insurance service expenses | -752 | -690 | -614 | -2 240 | -1 681 |
| Insurance service result | 349 | 370 | 317 | 963 | 999 |
| Result from reinsurance contracts held | 11 | -4 | -6 | -9 | -14 |
| Insurance finance income and expense | 585 | -879 | 51 | -1 029 | 2 438 |
| Insurance result | 945 | -514 | 361 | -75 | 3 423 |
| Return on financial assets backing insurance contracts with | |||||
| participation features | -619 | 898 | -244 | 1 066 | -3 128 |
| Net insurance income | 325 | 384 | 117 | 991 | 295 |
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Premises | 117 | 126 | 123 | 365 | 335 |
| IT expenses | 713 | 730 | 648 | 2 074 | 1 832 |
| Telecommunications and postage | 26 | 30 | 27 | 87 | 81 |
| Consultants | 178 | 224 | 188 | 624 | 547 |
| Compensation to savings banks | 54 | 55 | 56 | 164 | 169 |
| Other purchased services | 272 | 278 | 261 | 816 | 745 |
| Travel | 26 | 36 | 20 | 89 | 51 |
| Entertainment | 6 | 9 | 7 | 21 | 18 |
| Supplies | 20 | 16 | 19 | 59 | 50 |
| Advertising, PR and marketing | 57 | 91 | 51 | 180 | 131 |
| Security transport and alarm systems | 19 | 17 | 16 | 53 | 53 |
| Repair/maintenance of inventories | 32 | 34 | 29 | 97 | 87 |
| Other administrative expenses | 111 | 112 | 122 | 334 | 349 |
| Other operating expenses | 20 | 26 | 8 | 74 | 49 |
| Total | 1 648 | 1 783 | 1 576 | 5 038 | 4 497 |
| SEKm | Q3 2023 |
Q2 2023 |
Q3 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
|---|---|---|---|---|---|
| Credit impairments for loans at amortised cost | |||||
| Credit impairments - stage 1 | 223 | -95 | 99 | 387 | 506 |
| Credit impairments - stage 2 | 186 | 168 | 410 | 811 | 176 |
| Credit impairments - stage 3 | -311 | 54 | -26 | -253 | -562 |
| Credit impairments - purchased or originated credit impaired | 1 | 1 | 0 | 3 | 0 |
| Total | 99 | 128 | 484 | 947 | 119 |
| Write-offs | 121 | 117 | 144 | 295 | 759 |
| Recoveries | -40 | -51 | -37 | -140 | -119 |
| Total | 81 | 66 | 107 | 155 | 640 |
| Total - credit impairments for loans at amortised cost | 180 | 194 | 591 | 1 102 | 759 |
| Credit impairments for loan commitments and guarantees | |||||
| Credit impairments - stage 1 | 8 | -2 | 5 | 41 | 109 |
| Credit impairments - stage 2 | 152 | -4 | 3 | 169 | -61 |
| Credit impairments - stage 3 | 7 | 0 | 4 | -1 | -7 |
| Total - credit impairments for loan commitments and guarantees |
167 | -6 | 11 | 209 | 41 |
| Total credit impairments | 347 | 188 | 602 | 1 311 | 800 |
| Credit impairment ratio, % | 0.07 | 0.04 | 0.13 | 0.09 | 0.06 |
The measurement of expected credit losses is described in Note G3.1 Credit risk on pages 81-86 of the 2022 Annual and Sustainability Report.
High inflation, rising interest rates, increasing costs and high energy prices combined with geopolitical instability continue to weigh on private persons and companies, resulting in a high level of uncertainty regarding economic growth going forward. As the quantitative risk models do not yet reflect all potential deteriorations in credit quality, post-model adjustments have been made to capture potential future rating and stage migrations.
Post-model expert credit adjustments to increase the credit impairment provisions continue to be deemed necessary and amounted to SEK 1 493m (SEK 1 661m at 30 June 2023, SEK 1 738m at 31 December 2022) and are allocated as SEK 870m in stage 1, SEK 622m
in stage 2 and SEK 1m in stage 3. Customers and industries are reviewed and analysed considering the current situation, particularly in more vulnerable sectors. During the third quarter, the largest releases of postmodel expert credit adjustments related to the Shipping and offshore, Property management and Transportation sectors and primarily due to rating changes. The most significant post-model adjustments at 30 September 2023 were in the Property management, Manufacturing, Retail and wholesale, and Construction sectors.
Determination of a significant increase in credit risk As per 30 September 2023, the significant increase in credit risk threshold for the Swedish mortgage portfolio was amended to include an absolute PD threshold. Swedish mortgages originated with risk grades 18 to 21 with a relative increase of 200-300 per cent and an absolute increase in the 12-month PD above 7.5 basis points have experienced a significant increase in credit risk.
The tables below show the quantitative thresholds used by the Group for assessing a significant increase in credit risk, namely:
Alternatively, for exposures originated with risk grades 18 to 21, an increase of 200-300 per cent from initial recognition is considered significant except for Swedish mortgages where an absolute 12-month PD threshold is also applied.
These limits reflect a lower sensitivity to change in the low-risk end of the risk scale and a higher sensitivity to change in the high-risk end of the scale. The Group has performed a sensitivity analysis on how credit impairment provisions would change if thresholds applied were increased or decreased. A lower threshold would increase the number of loans that have migrated from Stage 1 to Stage 2 and also increase the estimated credit impairment provisions. A higher threshold would have the opposite effect.
The tables below disclose the impacts of this sensitivity analysis on the credit impairment provisions. Positive amounts represent higher credit impairment provisions that would be recognised.
| Impairment provision impact of | Impairment provision impact of | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Internal risk grade at initial recognition |
12-month PD band at initial recognition, % |
Threshold, rating downgrade 123 |
Increase in threshold by 1 grade, % |
Decrease in threshold by 1 grade, % |
Recognised credit impairment provisions 30 Sep 2023 |
Share of total portfolio in terms of gross carrying amount, % 30 Sep 2023 |
Increase in threshold by 1 grade, % |
Decrease in threshold by 1 grade, % |
Recognised credit impairment provisions 31 Dec 2022 |
Share of total portfolio in terms of gross carrying amount, % 31 Dec 2022 |
| $18 - 21$ | < 0.1 | 5 - 8 grades | $-3.5$ | 4.0 | 87 | 12 | $-5.6$ | 5.4 | 60 | 12 |
| $13 - 17$ | $0.1 - 0.5$ | 3 - 7 grades | $-3.5$ | 7.3 | 306 | 12 | $-5.7$ | 7.4 | 277 | 12 |
| $9 - 12$ | $>0.5 - 2.0$ | $1 - 5$ grades | $-12.0$ | 13.3 | 223 | $-12.9$ | 13.4 | 216 | ||
| $6 - 8$ | $2.0 - 5.7$ | $1 - 3$ grades | $-9.3$ | 4.9 | 95 | $-6.1$ | 5.1 | 100 | ||
| $0 - 5$ | $>5.7 - 99.9$ | 1 grade | $-1.5$ | 0.0 | 75 | $-1.2$ | 0.0 | 72 | ||
| $-6.5$ | 7.7 | 785 | 30 | $-7.6$ | 8.1 | 726 | 31 | |||
| Sovereigns and financial institutions with low credit risk | 31 | 3 | ||||||||
| Stage 3 financial instruments | 722 | 653 | 0 | |||||||
| Post model expert credit adjustment 4 | 246 | 401 | ||||||||
| Total 5 | 1784 | 30 | 1783 | 33 |
| Impairment provision impact of |
Impairment provision impact оf |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Internal risk grade at initial recognition |
Threshold, increase in lifetime PD 1 , % |
Increase in threshold by 100%, % |
Decrease in threshold by 50%, % |
Recognised credit impairment provisions 30 Sep 2023 |
Share of total portfolio in terms of gross carrying amount, % 30 Sep 2023 |
Increase in threshold by 100%, % |
Decrease in threshold by 50%, % |
Recognised credit impairment provisions 31 Dec 2022 |
Share of total portfolio in terms of gross carrying amount, % 31 Dec 2022 |
|
| 18-21 | 200-300 2 | $-10.5$ | 12.5 | 166 | 21 | $-14.3$ | 24.1 | 86 | 20 | |
| $13 - 17$ | 100-250 | $-2.5$ | 3.5 | 1499 | 23 | $-2.3$ | 10.0 | 706 | 22 | |
| $9 - 12$ | 100-200 | $-1.1$ | 4.5 | 1419 | 13 | $-1.5$ | 8.0 | 873 | 11 | |
| $6 - 8$ | 50-150 | $-1.3$ | 4.3 | 395 | $-2.0$ | 6.8 | 285 | 3 | ||
| $0-5$ | 50 | $-0.4$ | 0.6 | 263 | $\overline{2}$ | $-1.2$ | 1.3 | 166 | ||
| $-2.0$ | 4.2 | 3742 | 63 | $-2.3$ | 8.6 | 2 1 1 6 | 58 | |||
| Sovereigns and financial institutions with low credit risk | 46 | 26 | 9 | |||||||
| Stage 3 financial instruments | 1 2 8 8 | 0 | 1 503 | 0 | ||||||
| Post-model expert credit adjustment 3 | 1 2 4 5 | 1 3 3 5 | ||||||||
| T ofa | 6321 | 70 | 4981 | 67 |
The Swedbank Economic Outlook was published on 23 August and the baseline scenario was updated by Swedbank Macro Research as of 8 September. The baseline scenario, with an assigned probability weight of 66.6 per cent, is aligned with the published outlook and incorporates updated observed outcome and data
points. The alternative scenarios are aligned with the updated baseline scenario, with probability weights of 16.7 per cent assigned to both the upside and downside scenario. The table below sets out the key assumptions of the scenarios at 30 September 2023.
| 30 September 2023 | Positive scenario | Baseline scenario | Negative scenario | ||||||
|---|---|---|---|---|---|---|---|---|---|
| 2023 | 2024 | 2025 | 2023 | 2024 | 2025 | 2023 | 2024 | 2025 | |
| Sweden | |||||||||
| GDP (annual % change) | -0.7 | 0.9 | 2.2 | -0.7 | -0.2 | 2.3 | -1.1 | -6.6 | 0.7 |
| Unemployment (annual %)¹ | 7.5 | 8.1 | 8.2 | 7.5 | 8.2 | 8.3 | 7.7 | 10.4 | 11.3 |
| House prices (annual % change) | -10.9 | -4.4 | 3.1 | -10.9 | -4.8 | 2.6 | -13.8 | -20.4 | -2.2 |
| Stibor 3m (%) | 3.75 | 4.15 | 2.93 | 3.75 | 4.01 | 2.90 | 3.86 | 1.43 | 0.16 |
| Estonia | |||||||||
| GDP (annual % change) | -2.0 | 3.6 | 3.0 | -2.1 | 2.0 | 3.0 | -2.9 | -7.9 | -1.0 |
| Unemployment (annual %) | 6.4 | 6.3 | 4.9 | 6.4 | 6.7 | 5.4 | 6.5 | 10.2 | 13.9 |
| House prices (annual % change) | 1.1 | -1.5 | 4.7 | 1.1 | -3.4 | 4.3 | -2.7 | -26.6 | -4.5 |
| Latvia | |||||||||
| GDP (annual % change) | -0.1 | 2.4 | 2.3 | -0.2 | 1.5 | 2.3 | -1.1 | -7.6 | -0.9 |
| Unemployment (annual %) | 7.2 | 6.7 | 6.4 | 7.2 | 6.9 | 6.7 | 7.3 | 10.7 | 15.2 |
| House prices (annual % change) | 4.7 | -1.9 | 5.2 | 4.6 | -2.8 | 4.3 | 0.0 | -31.1 | -0.3 |
| Lithuania | |||||||||
| GDP (annual % change) | 0.5 | 2.6 | 2.8 | 0.3 | 1.7 | 2.8 | -0.4 | -7.4 | -0.6 |
| Unemployment (annual %) | 6.5 | 6.3 | 5.7 | 6.5 | 6.6 | 5.9 | 6.8 | 11.3 | 14.4 |
| House prices (annual % change) | -1.0 | 2.4 | 5.1 | -1.3 | 0.4 | 5.2 | -4.4 | -23.8 | -4.3 |
| Global indicators | |||||||||
| US GDP (annual %) | 2.0 | 1.4 | 1.9 | 1.9 | 0.4 | 1.8 | 1.6 | -3.6 | -0.8 |
| EU GDP (annual %) | 0.6 | 1.5 | 1.5 | 0.5 | 0.6 | 1.5 | 0.1 | -6.1 | -1.3 |
| Brent Crude Oil (USD/Barrel) | 82.3 | 83.1 | 77.7 | 82.1 | 81.7 | 77.6 | 78.6 | 49.0 | 50.3 |
| Euribor 6m (%) | 3.71 | 3.53 | 2.17 | 3.71 | 3.46 | 2.14 | 3.89 | 1.41 | 0.07 |
1) Unemployment rate, 16-64 years
Global economic activity will slow starting this autumn and this will continue into 2024. A gradual recovery will start during the second half of next year and continue throughout 2025.
Although the US economy has surprised on the upside so far this year, growth is expected to slow in the coming year. In the euro area, growth is slowing and will remain weak in the coming year, although developments are diverging across countries. In both the US and the euro area, inflation will continue to fall in the coming months and will normalise by mid-2024.
Swedish GDP will decline this year and next year as well, due to weak domestic and global demand. A slow recovery will begin during next year and strengthen further in 2025 when inflation has normalised. The labour market will weaken later this year, but the fall in employment is expected to be limited. Housing prices are expected to fall further before bottoming out in first half of next year.
The Estonian economy is likely to be the worst hit in the EU this year, while the Latvian and Lithuanian economies are stagnating. Inflation has fallen sharply, and wages are growing faster than prices again which will support household consumption going forward. Rapid wage growth poses some risks for both inflation and exporters' competitiveness.
The table below shows the credit impairment provisions that would result from the negative and positive scenarios, which are considered reasonably possible, being assigned a probability weight of 100 per cent. Post-model expert credit adjustments are assumed to be constant in the results.
| 30 Sep 2023 | 31 Dec 2022 1 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Credit impairment provisions | Credit impairment provisions | ||||||||||
| Operating segments | Credit impairment provisions (probability) weighted) |
Of which: post-model expert credit adjustment |
Negative scenario |
Positive scenario |
Credit impairment provisions (probability weighted) |
Of which: post-model expert credit adiustment |
Negative scenario |
Positive scenario |
|||
| Swedish Banking | 2514 | 280 | 2698 | 2468 | 1799 | 213 | 1927 | 1659 | |||
| Baltic Banking | 1559 | 425 | 853 | 1 2 3 4 | 1400 | 363 | 1692 | 1 254 | |||
| Corporates and Institutions | 3993 | 787 | 4 4 3 4 | 3983 | 3 5 4 2 | 1 1 6 2 | 4 1 1 0 | 3 2 9 4 | |||
| Group 2 | 8 1 0 5 | 1493 | 9025 | 7 7 2 4 | 6 7 6 4 | 1738 | 7753 | 6 2 2 8 |
| Q3 | Q2 | Q3 | Jan-Sep | Jan-Sep | |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Swedish bank tax | 292 | 292 | 239 | 876 | 718 |
| Lithuanian bank tax | 596 | 325 | 0 | 921 | 0 |
| Resolution fees | 222 | 227 | 227 | 675 | 674 |
| Total | 1 110 | 844 | 466 | 2 472 | 1 392 |
Lithuanian bank tax refers to the Lithuanian temporary solidarity contribution on credit institutions that was introduced and is calculated from May 2023 until the end of 2024. The bank tax is 60 percent and is applied to a part of the net interest income earned during the period which exceeds the average net interest income of four historical years by more than 50 percent.
The following tables present loans to the public and credit institutions at amortised cost by industry sectors, loans and credit impairment provisions ratios.
| Stage 1 | Stage 2 | Stage 3 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEKm | Gross carrying amount |
Credit impairment provisions |
Net | Gross | Credit carrying impairment amount provisions |
Net | Gross | Credit carrying impairment amount provisions |
Net | Total |
| Sector/industy | ||||||||||
| Private customers | 1 091 932 | 287 | 1 091 644 | 87 206 | 859 | 86 346 | 2782 | 895 | 1887 | 1 179 878 |
| Private mortgage | 960 655 | 129 | 960 526 | 73 505 | 421 | 73 084 | 1755 | 329 | 1426 | 1 035 036 |
| Tenant owner associations | 88 821 | 9 | 88 813 | 4 3 9 8 | 13 | 4 3 8 6 | $\sqrt{4}$ | $\mathbf{1}$ | $\overline{4}$ | 93 202 |
| Private other | 42 456 | 150 | 42 30 6 | 9 3 0 3 | 426 | 8877 | 1 0 2 3 | 565 | 458 | 51 640 |
| Corporate customers | 530 344 | 1 5 9 6 | 528 747 | 98 943 | 2 4 0 1 | 96 542 | 3942 | 1 0 8 4 | 2858 | 628 147 |
| Agriculture, forestry, fishing | 54 591 | 109 | 54 482 | 7807 | 144 | 7 6 6 3 | 233 | 47 | 186 | 62 331 |
| Manufacturing | 35 4 54 | 316 | 35 138 | 7945 | 390 | 7 5 5 5 | 364 | 166 | 198 | 42 891 |
| Public sector and utilities | 33 210 | 53 | 33 158 | 4 0 4 1 | 108 | 3933 | 122 | 32 | 89 | 37 180 |
| Construction | 16 960 | 133 | 16826 | 5979 | 160 | 5819 | 172 | 69 | 103 | 22748 |
| Retail and wholesale | 38 222 | 213 | 38 008 | 6 6 6 8 | 192 | 6476 | 301 | 80 | 221 | 44 705 |
| Transportation | 12 6 65 | 67 | 12 598 | 2 2 4 3 | 94 | 2 1 4 9 | 565 | 152 | 413 | 15 160 |
| Shipping and offshore | 6 0 5 6 | 12 | 6 0 4 3 | 831 | 32 | 799 | 1 1 5 2 | 201 | 951 | 7793 |
| Hotels and restaurants | 5 0 7 4 | 27 | 5 0 4 7 | 1931 | 127 | 1804 | 82 | 21 | 61 | 6911 |
| Information and communication | 14 710 | 118 | 14 592 | 6 3 5 7 | 50 | 6 3 0 7 | $\overline{2}$ | $\mathbf{1}$ | $\mathbf{1}$ | 20 901 |
| Finance and insurance | 24 293 | 30 | 24 263 | 1960 | 55 | 1906 | 13 | 4 | 9 | 26 177 |
| Property management, including | 255 859 | 451 | 255 408 | 46 177 | 911 | 45 266 | 617 | 213 | 404 | 301 079 |
| Residential properties | 72 633 | 120 | 72 514 | 17779 | 431 | 17 348 | 106 | 18 | 88 | 89 949 |
| Commercial | 126 282 | 240 | 126 042 | 16 569 | 350 | 16 218 | 250 | 139 | 110 | 142 371 |
| Industrial and Warehouse | 36 783 | 50 | 36 733 | 7 1 6 7 | 76 | 7 0 9 1 | 116 | 13 | 103 | 43 927 |
| Other | 20 160 | 41 | 20 119 | 4 6 6 3 | 53 | 4610 | 146 | 43 | 103 | 24 8 32 |
| Professional services | 22 707 | 49 | 22 658 | 3073 | 41 | 3 0 3 2 | 198 | 73 | 125 | 25 8 15 |
| Other corporate lending | 10 542 | 16 | 10 526 | 3931 | 98 | 3833 | 122 | 24 | 98 | 14 457 |
| Loans to customers | 1 622 275 | 1884 | 1620392 | 186 149 | 3 2 6 0 | 182888 | 6724 | 1979 | 4746 | 1808026 |
| Loans to the public, Swedish National Debt Office | $\Omega$ | $\mathbf 0$ | $\Omega$ | |||||||
| Loans to credit institutions | 26 304 | 49 | 26 255 | 180 | 3 | 177 | 26 432 | |||
| Loans to the public and credit institutions at amortised cost |
1 648 579 | 1933 | 1 646 647 | 186 328 | 3 2 6 3 | 183 065 | 6724 | 1979 | 4746 | 1834458 |
| Share of loans, % | 89.52 | 10.12 | 0.37 | 100 | ||||||
| Credit impairment provision ratio, % | 0.12 | 1.75 | 29.42 | 0.39 |
| Stage 1 | Stage 2 | Stage 31 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEKm | Gross | Credit carrying impairment |
Net | Gross | Credit carrying impairment amount provisions |
Net | Gross | Credit carrying impairment |
Net | Total |
| Sector/industy | amount provisions | amount provisions | ||||||||
| Private customers | 1 107 994 | 168 | 1 107 827 | 68 617 | 546 | 68 071 | 2 0 4 3 | 676 | 1 3 6 7 | 1 177 266 |
| Private mortgage | 973 876 | 68 | 973 809 | 56 758 | 243 | 56 514 | 1 2 1 9 | 229 | 990 | 1 0 3 1 3 1 3 |
| Tenant owner associations | 90 170 | $\overline{7}$ | 90 163 | 3468 | 12 | 3 4 5 6 | 93 623 | |||
| 4 | $\mathbf 0$ | 4 | ||||||||
| Private other | 43 948 | 93 | 43 855 | 8 3 9 2 | 291 | 8 1 0 1 | 820 | 446 | 374 | 52 330 |
| Corporate customers | 552 194 | 1 3 3 0 | 550 864 | 69831 | 1858 | 67973 | 3695 | 1 4 4 5 | 2 2 5 0 | 621 087 |
| Agriculture, forestry, fishing | 55 387 | 88 | 55 299 | 7609 | 130 | 7479 | 241 | 39 | 203 | 62 981 |
| Manufacturing | 43 283 | 279 | 43 004 | 5670 | 295 | 5375 | 264 | 104 | 161 | 48 540 |
| Public sector and utilities | 35 4 35 | 58 | 35 378 | 2 0 4 8 | 38 | 2011 | 17 | $\overline{2}$ | 15 | 37 403 |
| Construction | 15 502 | 64 | 15 4 38 | 4 3 1 8 | 91 | 4 2 2 8 | 107 | 54 | 52 | 19718 |
| Retail and wholesale | 36 568 | 246 | 36 322 | 4 0 4 3 | 188 | 3856 | 137 | 51 | 87 | 40 265 |
| Transportation | 12747 | 78 | 12 6 69 | 1936 | 120 | 1816 | 48 | 10 | 38 | 14 522 |
| Shipping and offshore | 8 4 5 4 | 39 | 8415 | 1 1 5 0 | 177 | 973 | 1881 | 890 | 991 | 10 380 |
| Hotels and restaurants | 3 0 0 3 | 29 | 2975 | 3946 | 129 | 3817 | 285 | 62 | 223 | 7015 |
| Information and communication | 19 536 | 53 | 19 4 83 | 1 508 | 15 | 1493 | 5 | $\mathbf{1}$ | 4 | 20 979 |
| Finance and insurance | 23 247 | 21 | 23 2 26 | 885 | 11 | 874 | 22 | $\overline{7}$ | 15 | 24 115 |
| Property management, including | 260 973 | 320 | 260 652 | 32 954 | 576 | 32 379 | 466 | 178 | 288 | 293 319 |
| Residential properties | 69 573 | 56 | 69 518 | 16 167 | 253 | 15914 | 103 | 16 | 87 | 85 519 |
| Commercial | 123 507 | 170 | 123 337 | 7925 | 207 | 7717 | 208 | 127 | 81 | 131 134 |
| Industrial and Warehouse | 40 805 | 47 | 40 758 | 5 1 4 2 | 59 | 5083 | 16 | 3 | 13 | 45 853 |
| Other | 27 087 | 47 | 27 040 | 3722 | 56 | 3665 | 140 | 33 | 107 | 30 813 |
| Professional services | 23 5 14 | 31 | 23 4 83 | 2 2 5 1 | 51 | 2 2 0 1 | 65 | 13 | 52 | 25 7 35 |
| Other corporate lending | 14 546 | 24 | 14 522 | 1511 | 39 | 1472 | 156 | 35 | 122 | 16 116 |
| Loans to customers | 1660 189 | 1498 | 1658691 | 138 449 | 2 4 0 4 | 136 044 | 5738 | 2 1 2 1 | 3617 | 1798352 |
| Cash collaterals posted | 3 6 0 5 | 3 6 0 5 | 3 6 0 5 | |||||||
| Loans to the public, Swedish National Debt Office | 10 004 | 10 004 | 10 004 | |||||||
| Loans to credit institutions | 56 453 | 26 | 56 427 | 147 | 0 | 146 | 56 574 | |||
| Loans to the public and credit institutions at amortised cost |
1730 251 | 1 5 2 4 | 1728727 | 138 596 | 2 4 0 4 | 136 191 | 5738 | 2 1 2 1 | 3617 | 1868 536 |
| Share of loans. % | 92.30 | 7.39 | 0.31 | 100 | ||||||
| Credit impairment provision ratio, % | 0.09 | 1.73 | 36.96 | 0.32 | ||||||
| A Vita alternative and a complete state of a startern and a state that started |
| 30 September 2022 | Stage 1 | Stage 2 | Stage 3 1 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Gross | Credit carrying impairment |
Gross | Credit carrying impairment |
Gross | Credit carrying impairment |
|||||
| SEKm | amount provisions | Net | amount provisions | Net | amount provisions | Net | Total | |||
| Sector/industry | ||||||||||
| Private customers | 1 113 984 | 140 | 1 113 844 | 59 911 | 445 | 59 466 | 1965 | 537 | 1427 | 1 174 737 |
| Private mortgage | 975 974 | 53 | 975 921 | 51 051 | 208 | 50 843 | 1 1 4 4 | 207 | 937 | 1 027 701 |
| Tenant owner associations | 91 398 | 5 | 91 392 | 1995 | $\overline{7}$ | 1988 | $\overline{4}$ | $\overline{4}$ | 93 384 | |
| Private other | 46 612 | 82 | 46 530 | 6865 | 230 | 6635 | 817 | 330 | 487 | 53 651 |
| Corporate customers | 558 844 | 1 2 1 8 | 557 626 | 63899 | 1596 | 62 303 | 4 4 2 7 | 1 5 5 7 | 2871 | 622 800 |
| Agriculture, forestry, fishing | 56 831 | 73 | 56 758 | 6997 | 103 | 6895 | 224 | 35 | 189 | 63 842 |
| Manufacturing | 40 162 | 288 | 39 874 | 5 6 8 5 | 193 | 5493 | 264 | 72 | 191 | 45 558 |
| Public sector and utilities | 36 133 | 50 | 36 083 | 3540 | 47 | 3493 | 22 | $\overline{4}$ | 18 | 39 5 94 |
| Construction | 17 027 | 77 | 16 951 | 3 2 7 3 | 106 | 3 1 6 7 | 124 | 58 | 66 | 20 184 |
| Retail and wholesale | 37 729 | 202 | 37 527 | 3 1 6 3 | 119 | 3 0 4 4 | 127 | 41 | 85 | 40 656 |
| Transportation | 12 3 9 0 | 82 | 12 309 | 2053 | 111 | 1942 | 54 | 11 | 43 | 14 293 |
| Shipping and offshore | 9 2 3 1 | 66 | 9 1 6 5 | 1911 | 270 | 1642 | 2 3 8 0 | 1 0 2 3 | 1 3 5 7 | 12 164 |
| Hotels and restaurants | 3 1 6 9 | 19 | 3 1 5 0 | 3745 | 135 | 3610 | 348 | 79 | 269 | 7 0 2 9 |
| Information and communication | 20 832 | 55 | 20 777 | 859 | 15 | 844 | $\overline{7}$ | -1 | 6 | 21 627 |
| Finance and insurance | 24 962 | 15 | 24 947 | 1766 | 6 | 1760 | 22 | $\overline{7}$ | 15 | 26 7 23 |
| Property management, including | 261 974 | 239 | 261 735 | 27 28 2 | 402 | 26 880 | 724 | 190 | 535 | 289 149 |
| Residential properties | 71 499 | 36 | 71 463 | 14 3 22 | 179 | 14 144 | 112 | 13 | 99 | 85 706 |
| Commercial | 121 488 | 126 | 121 361 | 6519 | 167 | 6 3 5 2 | 189 | 128 | 60 | 127 774 |
| Industrial and Warehouse | 41 067 | 39 | 41 0 27 | 3814 | 31 | 3782 | 22 | 4 | 19 | 44 828 |
| Other | 27 9 20 | 37 | 27883 | 2627 | 25 | 2601 | 402 | 45 | 357 | 30 841 |
| Professional services | 22 355 | 28 | 22 3 27 | 2 2 2 0 | 58 | 2 1 6 3 | 56 | 13 | 43 | 24 533 |
| Other corporate lending | 16 047 | 24 | 16 023 | 1403 | 31 | 1 3 7 2 | 76 | 23 | 53 | 17 448 |
| Loans to customers | 1672828 | 1 3 5 8 | 1671470 | 123 810 | 2 0 4 1 | 121 769 | 6392 | 2094 | 4 2 9 8 | 1797537 |
| Cash collaterals posted | 3 3 7 1 | 3 3 7 1 | 3 3 7 1 | |||||||
| Loans to the public, Swedish National Debt Office | $\overline{4}$ | 4 | $\Delta$ | |||||||
| Loans to credit institutions | 55 072 | 29 | 55 043 | 121 | 3 | 119 | 55 161 | |||
| Loans to the public and credit institutions at amortised cost |
1731275 | 1 3 8 7 | 1729888 | 123 931 | 2 0 4 4 | 121 888 | 6 3 9 2 | 2094 | 4 2 9 8 | 1856072 |
| Share of loans, % | 93.00 | 6.66 | 0.34 | 100 | ||||||
| Credit impairment provision ratio, % | 0.08 | 1.65 | 32.76 | 0.30 | ||||||
The tables below provide a reconciliation of credit impairment provisions for loans to the public and credit institutions at amortised cost.
| Loans to the public and credit institutions | 2023 | 2022 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| SEKm | Stage 1 Stage 2 | Stage 3 1 | Total | Stage 1 | Stage 2 | Stage 3 1 | Total | ||
| Carrying amount before provisions | |||||||||
| Opening balance 1 January | 1730 251 | 138 596 | 5 738 1 874 585 | 1 616 594 | 98 633 | 6 362 1 721 589 | |||
| Closing balance 30 September | 1648579 | 186 328 | 6724 1841 632 | 1731275 | 123 931 | 6 392 1 861 598 | |||
| Credit impairment provisions | |||||||||
| Opening balance 1 January | 1 5 2 4 | 2 4 0 4 | 2 1 2 1 | 6049 | 806 | 1789 | 2 4 2 7 | 5022 | |
| Movements affecting Credit impairments | |||||||||
| New and derecognised financial assets, net | 391 | $-138$ | -340 | -87 | 169 | $-77$ | $-850$ | $-758$ | |
| Changes in risk factors (EAD, PD, LGD) | 407 | $-186$ | 107 | 328 | $-22$ | $-242$ | 16 | $-248$ | |
| Changes in macroeconomic scenarios | 213 | 249 | $-5$ | 457 | 342 | 352 | 10 | 705 | |
| Changes to models | 1 | $\mathbf 0$ | 0 | 39 | 58 | 0 | 97 | ||
| Post-model expert credit adjustments | $-49$ | $-134$ | $\mathbf{1}$ | $-181$ | 104 | $-232$ | $-1$ | $-128$ | |
| Individual assessments | $-226$ | $-226$ | 53 | 53 | |||||
| Stage transfers | $-576$ | 1 0 2 1 | 300 | 744 | $-126$ | 317 | 265 | 456 | |
| from 1 to 2 | $-663$ | 1673 | 1 0 1 0 | $-172$ | 602 | 430 | |||
| from 1 to 3 | $-28$ | 37 | 9 | 0 | 56 | 55 | |||
| from 2 to 1 | 113 | $-415$ | $-301$ | 44 | $-223$ | $-179$ | |||
| from $2$ to $3$ | $-298$ | 372 | 74 | $-96$ | 348 | 252 | |||
| from 3 to 2 | 60 | $-97$ | $-36$ | 35 | $-112$ | $-77$ | |||
| from 3 to 1 | 2 | $-13$ | $-11$ | 2 | $-27$ | $-26$ | |||
| Other | $-92$ | $-92$ | $-56$ | $-56$ | |||||
| Total movements affecting credit impairments | 387 | 811 | $-254$ | 944 | 506 | 176 | $-562$ | 120 | |
| Movements recognised outside credit impairments | |||||||||
| Interest | 92 | 92 | 56 | 56 | |||||
| Change in exchange rates | 22 | 48 | 19 | 88 | 75 | 79 | 174 | 327 | |
| Closing balance 30 September | 1933 | 3 2 6 3 | 1979 | 7 1 7 4 | 1 3 8 7 | 2 0 4 4 | 2 0 9 4 | 5 5 2 6 | |
| Carrying amount | |||||||||
| Opening balance 1 January | 1728727 | 136 191 | 3 617 1 868 536 | 1615788 | 96 844 | 3 935 1 716 567 | |||
| Closing balance 30 September | 1 646 647 | 183 065 | 4 746 1 834 458 | 1729888 | 121888 | 4 298 1 856 072 |
The tables below provide a reconciliation of credit impairment provisions for loan commitments and financial guarantees.
| 2023 | 2022 | |||||||
|---|---|---|---|---|---|---|---|---|
| SEKm | Stage 1 | Stage 2 Stage 3 1 | Total | Stage 1 | Stage 2 Stage 3 1 | Total | ||
| Nominal amount | ||||||||
| Opening balance 1 January | 286 621 | 23 956 | 131 | 310 708 | 306 298 | 16 134 | 221 | 322 653 |
| Closing balance 30 September | 261 022 | 44 626 | 166 | 305 815 | 295 547 | 23 848 | 227 | 319 622 |
| Credit impairment provisions | ||||||||
| Opening balance 1 January | 384 | 295 | 34 | 714 | 286 | 273 | 85 | 644 |
| Movements affecting Credit impairments | ||||||||
| New and derecognised financial assets, net | 48 | 21 | $-5$ | 64 | 47 | 53 | $-25$ | 76 |
| Changes in risk factors (EAD, PD, LGD) | 89 | 58 | $-3$ | 144 | $-25$ | $-84$ | 21 | $-88$ |
| Changes in macroeconomic scenarios | 41 | 28 | 0 | 70 | 91 | 41 | $\Omega$ | 131 |
| Changes to models | $\overline{0}$ | $\Omega$ | $\Omega$ | 12 | $\overline{7}$ | $-15$ | $\overline{4}$ | |
| Post-model expert credit adjustments | $-82$ | $-12$ | 0 | $-94$ | -6 | $-76$ | $\mathbf{0}$ | $-82$ |
| Stage transfers | $-55$ | 74 | $\overline{7}$ | 25 | -9 | $-2$ | 12 | |
| from 1 to 2 | $-86$ | 164 | 78 | $-26$ | 68 | 43 | ||
| from $1$ to $3$ | -1 | $\overline{2}$ | 1 | 0 | 9 | 9 | ||
| from 2 to 1 | 32 | $-88$ | $-56$ | 17 | $-70$ | $-54$ | ||
| from $2$ to $3$ | $-4$ | 13 | 10 | $-1$ | 7 | 5 | ||
| from 3 to 2 | 0 | $-3$ | $-2$ | 1 | $-3$ | $-2$ | ||
| from 3 to 1 | 0 | $-6$ | $-5$ | 0 | $\mathbf{0}$ | $\mathbf{0}$ | ||
| Total movements affecting credit impairments | 41 | 169 | $-1$ | 209 | 109 | $-61$ | $-7$ | 41 |
| Change in exchange rates | 6 | 2 | $\mathbf 0$ | 8 | 20 | 7 | 10 | 37 |
| Closing balance 30 September | 432 | 467 | 32 | 931 | 414 | 218 | 89 | 722 |
| 30 Sep | 31 Dec | 30 Sep | |
|---|---|---|---|
| SEKm | 2023 | 2022 | 2022 |
| Assets | |||
| Cash and balances with central banks | 287 996 | 365 992 | 454 584 |
| Interest-bearing securities | 366 917 | 212 780 | 214 719 |
| Loans to credit institutions | 53 167 | 56 589 | 63 463 |
| Loans to the public | 1 867 380 | 1 842 811 | 1 845 932 |
| Derivatives | 46 948 | 50 504 | 86 985 |
| Other financial assets | 14 217 | 8 215 | 26 778 |
| Total assets | 2 636 624 | 2 536 891 | 2 692 460 |
| Contingent liabilities and commitments | |||
| Guarantees | 46 075 | 45 632 | 58 587 |
| Loan commitments | 259 740 | 265 076 | 261 035 |
| Total contingent liabilities and commitments | 305 815 | 310 708 | 319 622 |
| Total | 2 942 439 | 2 847 599 | 3 012 082 |
| Indefinate useful life | Definate useful life | Total | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Goodwill & Brand | Other intangible assets | ||||||||
| Jan-Sep | Full year | Jan-Sep | Jan-Sep | Full year | Jan-Sep | Jan-Sep | Full year | Jan-Sep | |
| SEKm | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 |
| Opening balance | 13 850 | 13 594 | 13 594 | 6 036 | 5 894 | 5 894 | 19 886 | 19 488 | 19 488 |
| Additions | 1 085 | 1 167 | 727 | 1 085 | 1 167 | 727 | |||
| Amortisation for the period | -495 | -525 | -356 | -495 | -525 | -356 | |||
| Impairment for the period | -624 | -181 | -11 | -501 | -263 | -11 | -1 125 | -443 | |
| Sales and disposals | -5 | -4 | -3 | -5 | -4 | -3 | |||
| Exchange rate differences | 441 | 880 | 632 | 2 | 5 | 3 | 443 | 885 | 635 |
| Closing balance | 14 290 | 13 850 | 14 045 | 6 613 | 6 036 | 6 003 | 20 904 | 19 886 | 20 047 |
As of 30 September 2023, there was no indication of an impairment of intangible assets.
During the second quarter of 2023, an impairment of SEK 11m was made in relation to internally developed software, which will no longer be used.
During 2022, impairments were made relating to internally developed software of SEK 501m, of which SEK 238m was related to PayEx and SEK 263m was related to internally developed software. The total impairment for Goodwill and Brand in 2022 amounted to SEK 624m, of which SEK 606m was related to Goodwill, and SEK 18m was related to Brand. Of the goodwill impairment of SEK 606m, SEK 425m was related to PayEx and SEK 191m referred to the Norwegian operations, which were transferred to Sparebank 1 Markets AS.
| SEKm | 30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
|---|---|---|---|
| Central banks | 8 887 | 12 092 | 41 685 |
| Banks | 74 528 | 54 857 | 103 928 |
| Other credit institutions | 6 728 | 5 219 | 6 204 |
| Repurchase agreements | 8 322 | 659 | 23 781 |
| Total | 98 465 | 72 826 | 175 599 |
| SEKm | 30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
|---|---|---|---|
| Private customers | 703 675 | 703 935 | 698 841 |
| Corporate customers | 574 036 | 594 343 | 577 894 |
| Total deposits from customers | 1 277 711 1 298 278 1 276 735 | ||
| Cash collaterals received | 4 436 | 4 754 | 8 470 |
| Swedish National Debt Office | 74 | 101 | 89 |
| Repurchase agreements - Swedish National Debt Office | 2 | 1 | 0 |
| Repurchase agreements | 3 398 | 2 815 | 17 805 |
| Total borrowings | 7 909 | 7 670 | 26 363 |
| Deposits and borrowings from the public | 1 285 620 1 305 948 1 303 098 |
| 30 Sep | 31 Dec | 30 Sep | |
|---|---|---|---|
| SEKm | 2023 | 2022 | 2022 |
| Commercial papers | 384 354 | 316 114 | 352 591 |
| Covered bonds | 355 628 | 343 284 | 348 601 |
| Senior unsecured bonds | 109 875 | 122 559 | 123 332 |
| Structured retail bonds | 1 626 | 2 249 | 2 350 |
| Total debt securities in issue | 851 482 | 784 206 | 826 874 |
| Senior non-preferred liabilities | 103 187 | 57 439 | 57 203 |
| Subordinated liabilities | 33 373 | 31 331 | 33 479 |
| Total | 988 042 | 872 976 | 917 556 |
| Jan-Sep | Full-year | Jan-Sep | |
| Turnover | 2023 | 2022 | 2022 |
| Opening balance | 872 976 | 802 353 | 802 353 |
| Issued | 754 611 | 1 008 334 | 780 911 |
| Repurchased | -5 884 | -35 067 | -24 424 |
| Repaid | -671 104 | -927 096 | -682 148 |
| Interest, change in fair values or hedged items in fair value hedges and | |||
| changes in exchange rates | 37 443 | 24 452 | 40 864 |
| Nominal amount | Positive fair value | Negative fair value | |||||||
|---|---|---|---|---|---|---|---|---|---|
| SEKm | 30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
| Derivatives in hedge accounting | |||||||||
| One-to-one fair value hedges¹ | 577 287 | 517 756 | 511 481 | 604 | 738 | 896 | 28 665 | 29 094 | 29 406 |
| Portfolio fair value hedges¹ | 345 136 | 436 005 | 472 230 | 15 893 | 20 289 | 21 332 | 9 | 23 | 35 |
| Cash flow hedges² | 8 500 | 8 179 | 8 007 | 910 | 603 | 459 | 1 | ||
| Total | 930 923 | 961 940 | 991 718 | 17 407 | 21 630 | 22 686 | 28 674 | 29 117 | 29 443 |
| Non-hedge accounting derivatives |
33 702 760 29 580 068 28 901 077 | 1 242 721 | 1 223 832 | 1 219 556 | 1 246 642 | 1 236 903 | 1 197 545 | ||
| Gross amount | 34 633 683 30 542 008 29 892 795 | 1 260 127 | 1 245 462 | 1 242 243 | 1 275 316 | 1 266 021 | 1 226 987 | ||
| Offset amount | -1 213 180 -1 194 958 -1 155 258 -1 221 674 -1 197 341 -1 156 314 | ||||||||
| Total | 46 948 | 50 504 | 86 985 | 53 642 | 68 679 | 70 674 |
1) Interest rate swaps
2) Cross currency basis swaps
The Group trades in derivatives in the normal course of business and for the purpose of hedging certain positions that are exposed to share price, interest rate, credit and currency risks. The carrying amounts of all derivatives refer to fair value including accrued interest.
The tables below present the carrying amount and fair value of financial assets and financial liabilities, according to valuation categories. The methodologies to determine the fair value are described in the Annual and Sustainability Report 2022, note G47 Fair value of financial instruments.
| 30 Sep 2023 | |||||||
|---|---|---|---|---|---|---|---|
| Fair value through profit and loss | |||||||
| Mandatorily | |||||||
| Hedging | Total carrying | ||||||
| SEKm | Amortised cost | Trading | Other | Total | instruments | amount | Fair value |
| Financial assets | |||||||
| Cash and balances with central banks | 287 996 | 287 996 | 287 996 | ||||
| Treasury bills and other bills eligible for refinancing | |||||||
| with central banks, etc. | 284 908 | 23 165 | 6 2 6 0 | 29 4 25 | 314 333 | 314 335 | |
| Loans to credit institutions | 26 432 | 26 735 | 26 735 | 53 167 | 53 167 | ||
| Loans to the public 1 | 1808026 | 58 983 | 371 | 59 354 | 1867380 | 1864057 | |
| Value change of the hedged assets in portfolio | |||||||
| hedges of interest rate risk | $-15288$ | $-15288$ | $-15288$ | ||||
| Bonds and other interest-bearing securities | 37 036 | 15 5 47 | 52 583 | 52 583 | 52 583 | ||
| Financial assets for which customers bear the | |||||||
| investment risk | 303 481 | 303 481 | 303 481 | 303 481 | |||
| Shares and participating interests | 23 36 3 | 27 404 | 50 767 | 50 767 | 50 767 | ||
| Derivatives | 45 537 | 45 537 | 1411 | 46 948 | 46 948 | ||
| Other financial assets | 14 4 20 | 14 4 20 | 14 4 20 | ||||
| Total | 2 406 494 | 214 818 | 353 063 | 567882 | 1411 | 2975786 | 2972465 |
| Fair value through profit and loss | |||||||
| Hedging | Total carrying | ||||||
| Amortised cost | Trading | Designated | Total | instruments | amount | Fair value | |
| Financial liabilities | |||||||
| Amounts owed to credit institutions | 71 2 23 | 27 24 2 | 27 24 2 | 98 465 | 98 4 65 | ||
| Deposits and borrowings from the public | 1 277 784 | 7835 | 7835 | 1 285 620 | 1 285 911 | ||
| Value change of the hedged liabilities in portfolio | |||||||
| hedges of interest rate risk | 1 | $\mathbf{1}$ | $\mathbf{1}$ | ||||
| Financial liabilities for which customers bear the | |||||||
| investment risk | 304 307 | 304 307 | 304 307 | ||||
| Debt securities in issue 2 | 849 735 | 1626 | 122 | 1748 | 851 482 | 853 593 | |
| Short position securities | 19775 | 19775 | 19 7 7 5 | 19775 | |||
| Derivatives | 52 080 | 52 080 | 1562 | 53 642 | 53 642 | ||
| Senior non-preferred liabilities | 103 187 | 103 187 | 108 085 | ||||
| Subordinated liabilities | 33 373 | 33 373 | 33 007 | ||||
| Other financial liabilities | 39 34 3 | 39 34 3 | 39 34 3 |
| 31 Dec 2022 | |||||||
|---|---|---|---|---|---|---|---|
| Fair value through profit and loss | |||||||
| Mandatorily | |||||||
| Hedging | Total carrying | ||||||
| SEKm | Amortised cost | Trading | Other | Total | instruments | amount | Fair value |
| Financial assets | |||||||
| Cash and balances with central banks | 365 992 | 365 992 | 365 992 | ||||
| Treasury bills and other bills eligible for refinancing | |||||||
| with central banks, etc. | 132 741 | 9903 | 8839 | 18742 | 151 483 | 151 485 | |
| Loans to credit institutions | 56 574 | 15 | 15 | 56 589 | 56 589 | ||
| Loans to the public 1 | 1811962 | 30 586 | 264 | 30 850 | 1842811 | 1838695 | |
| Value change of the hedged assets in portfolio | |||||||
| hedges of interest rate risk | $-20369$ | $-20369$ | $-20.369$ | ||||
| Bonds and other interest-bearing securities | 37 678 | 23 6 20 | 61 298 | 61 298 | 61 298 | ||
| Financial assets for which customers bear the | |||||||
| investment risk 2 | 268 594 | 268 594 | 268 594 | 268 594 | |||
| Shares and participating interests 2 | 4 4 6 7 | 25 801 | 30 268 | 30 268 | 30 268 | ||
| Derivatives | 48 980 | 48 980 | 1 5 2 4 | 50 504 | 50 504 | ||
| Other financial assets 2 | 8 0 2 4 | 8 0 2 4 | 8 0 24 | ||||
| Total | 2 3 5 4 9 2 3 | 131 628 | 327 118 | 458 746 | 1 5 2 4 | 2815193 | 2811079 |
| Fair value through profit and loss | |||||||
| Hedging | Total carrying | ||||||
| Amortised cost | Trading | Designated | Total | instruments | amount | Fair value | |
| Financial liabilities | |||||||
| Amounts owed to credit institutions | 72 167 | 659 | 659 | 72 826 | 72 826 | ||
| Deposits and borrowings from the public | 1 303 133 | 2815 | 2815 | 1 305 948 | 1 305 938 | ||
| Financial liabilities for which customers bear the | |||||||
| investment risk 2 | 268 892 | 268 892 | 268 892 | 268 892 | |||
| Debt securities in issue 3 | 781834 | 2 2 4 9 | 122 | 2 3 7 1 | 784 206 | 785 171 | |
| Short position securities | 27 134 | 27 134 | 27 134 | 27 134 | |||
| Derivatives | 67 400 | 67 400 | 1 2 8 0 | 68 679 | 68 679 | ||
| Senior non-preferred liabilities | 57 439 | 57 439 | 59 361 | ||||
| Subordinated liabilities | 31 331 | 31 331 | 31 121 | ||||
| $\cdots$ |
The determination of fair value, the valuation hierarchy and the valuation process for fair value measurements in Level 3 are described in the Annual and Sustainability Report 2022, note G47 Fair value of financial instruments.
The financial instruments are distributed in three levels depending on the degree of observable market data in the valuation and activity in the market.
The following tables present fair values of financial instruments recognised at fair value split between the three valuation hierarchy levels.
| 30 Sep 2023 | 31 Dec 2022 | |||||||
|---|---|---|---|---|---|---|---|---|
| SEKm | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total |
| Assets | ||||||||
| Treasury bills etc. | 27 186 | 2 2 3 9 | 29 4 25 | 15 630 | 3 1 1 2 | 18742 | ||
| Loans to credit institutions | 26 735 | 26 735 | 15 | 15 | ||||
| Loans to the public | 59 303 | 51 | 59 354 | 30 817 | 33 | 30 850 | ||
| Bonds and other interest-bearing securities Financial assets for which the customers |
39 686 | 12 8 98 | 52 583 | 42 138 | 19 160 | 61 298 | ||
| bear the investment risk 1 | 303 481 | 303 481 | 268 450 | 144 | 268 594 | |||
| Shares and participating interests 1 | 49 610 | 10 | 1 1 4 6 | 50 767 | 29 183 | 4 | 1 0 8 1 | 30 268 |
| Derivatives | 327 | 46 621 | 46 948 | 179 | 50 325 | 50 504 | ||
| Total | 420 290 | 147 805 | 1 1 9 8 | 569 293 | 355 580 | 103 433 | 1 2 5 8 | 460 271 |
| Liabilities | ||||||||
| Amounts owed to credit institutions | 27 242 | 27 24 2 | 659 | 659 | ||||
| Deposits and borrowings from the public | 7835 | 7835 | 2815 | 2815 | ||||
| Debt securities in issue | 1748 | 1748 | 2 3 7 1 | 2 3 7 1 | ||||
| Financial liabilities for which the customers bear the investment risk 1 |
304 307 | 304 307 | 268 748 | 144 | 268 892 | |||
| Derivatives | 336 | 53 306 | 53 642 | 197 | 68 482 | 68 679 | ||
| Short positions, securities | 18 031 | 1745 | 19775 | 27 014 | 120 | 27 134 | ||
| Total | 18 367 | 396 183 | 414 550 | 27 211 | 343 195 | 144 | 370 550 |
Transfers between levels are reflected as per the fair value at closing day. There were no transfers of financial instruments between valuation levels 1 and 2 during the period.
| 2023 | 2022 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Assets | Liabilities | Assets | Liabilities | |||||||
| Equity | Fund units of which customers bear the |
Liabilities for which the customers bear |
Equity | Fund units of which customers bear the |
Liabilities for which the customers bear |
|||||
| SEKm | instruments | Loans | investment risk | Total | the investment risk | instruments | Loans | investment risk | Total | the investment risk |
| Opening balance 1 January | 1 0 8 1 | 33 | 144 | 1 2 5 8 | 144 | 1 277 | 14 | 1 2 9 1 | ||
| Purchases | 34 | 18 | 52 | 27 | 18 | 45 | ||||
| Sale of assets/ dividends received | $-11$ | $-152$ | $-163$ | $-52$ | $-59$ | |||||
| Conversion Visa Inc shares | $-461$ | $\Omega$ | $-461$ | |||||||
| Sale of liabilities | $-152$ | |||||||||
| Repurchases | $-1$ | $-1$ | ||||||||
| Sale of liabilities | $-7$ | |||||||||
| Transferred from Level 1 to Level 3 | 139 | 139 | ||||||||
| Transferred from Level 2 to Level 3 | 139 | |||||||||
| Gains or losses, Net gains and losses on financial items of which changes in unrealised gains or losses for items |
43 | 8 | 52 | 156 | $-19$ | 138 | $-19$ | |||
| held at closing day | 43 | 44 | -8 | $-18$ | $-25$ | $-18$ | ||||
| Closing balance 30 September | 1 1 4 6 | 51 | 0 | 1 1 9 8 | 947 | 33 | 113 | 1093 | 113 |
Financial instruments are transferred to or from level 3 depending on whether the internal assumptions have changed in significance to the valuation.
Level 3 mainly comprises strategic unlisted shares. These include holdings in VISA Inc. C shares that are subject to selling restrictions until June 2028 and under certain conditions may have to be returned. Liquid quotes are not available for these shares, therefore the fair value is established with significant elements of Swedbank's own internal assumptions. The carrying amount of the holdings in Visa Inc. C amounted as per
30 September 2023 to SEK 495m (SEK 296m 30 September 2022).
In the Group's insurance operations, fund units are held in which the customers have chosen to invest their insurance savings. The holdings are reported in the balance sheet as financial assets where the customers bear the investment risk and are normally measured at fair value according to level 1, because the units are traded in an active market. The Group's obligations to insurance savers are reported as financial liabilities where the customers bear the investment risk because it is the customers who bear the entire market value
change of the assets. The liabilities are normally measured at fair value according to level 2.
During the first quarter 2022, trading was closed in whole or in part in Russia and Eastern Europe targeted funds. These unit holdings and liabilities to the insurance savers have been measured at fair value according to level 3. Fully closed funds have been measured at an indicative value, alternatively SEK 0m, while funds that were open for sales have been measured at the sale value. The liabilities have been measured on the same basis.
| 30 Sep | 31 Dec | 30 Sep | |
|---|---|---|---|
| SEKm | 2023 | 2022 | 2022 |
| Loans used as collateral for covered bonds¹ | 396 209 | 382 095 | 422 628 |
| Assets recorded in register on behalf of insurance policy holders | 318 967 | 290 678 | 277 217 |
| Other assets ledged for own liabilities | 128 812 | 82 800 | 67 920 |
| Other assets pledged | 14 826 | 14 287 | 8 627 |
| Assets pledged | 858 814 | 769 860 | 776 392 |
| Nominal amounts | |||
| Guarantees | 46 075 | 45 632 | 58 587 |
| Other | 71 | 75 | 87 |
| Contingent liabilities | 46 146 | 45 708 | 58 674 |
| Nominal amounts | |||
| Loans granted not paid | 204 839 | 202 987 | 199 888 |
| Overdraft facilities granted but not utilised | 54 901 | 62 089 | 61 147 |
| Commitments | 259 740 | 265 076 | 261 035 |
1) The pledge is defined as the borrower's nominal debt including accrued interest and refers to the loans of the total available collateral that are used as the pledge at each point in time.
Swedbank is cooperating with authorities in the United States who are conducting investigations into Swedbank's historic AML compliance and the Group's response thereto, as well as related issues involving the Group's anti-money laundering controls and certain individuals and entities who may at some time have been customers of the Group. Investigations by the Department of Justice, the Securities and Exchange Commission and the Department of Financial Services in New York are ongoing. In June 2023, Swedbank reached an agreement to remit SEK 37m related to violation of OFAC regulations.
In March 2022, Swedbank AS in Estonia was informed by the Estonian Prosecutor's Office that Swedbank AS is suspected of money laundering during the period 2014-2016. The maximum fine for the suspected crime is EUR 16m.
The timing of the completion of the investigations is still unknown and the outcomes are still uncertain. It is therefore not possible to reliably estimate the amount of any potential settlement or fines, which could be material.
The tables below present recognised financial instruments that have been offset in the balance sheet under IAS 32 and those that are subject to legally enforceable master netting or similar agreements but do not qualify for offset. Such financial instruments relate to derivatives, repurchase and reverse repurchase agreements, securities settlements, securities borrowing and lending transactions. Collateral amounts represent financial instruments or cash collateral received or pledged for transactions that are subject to a legally
enforceable master netting or similar agreements and which allow for the netting of obligations against the counterparty in the event of a default. Collateral amounts are limited to the amount of the related instruments presented in the balance sheet; therefore any over-collateralisation is not included. Amounts that are not offset in the balance sheet are presented as a reduction to the financial assets or liabilities in order to derive net asset and net liability exposure.
| Financial assets | Financial liabilities | ||||||
|---|---|---|---|---|---|---|---|
| 30 Sep | 31 Dec | 30 Sep | 30 Sep | 31 Dec | 30 Sep | ||
| SEKm | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 | |
| Financial assets and liabilities, which have been offset or are subject to netting |
|||||||
| Gross amount | 1 389 286 | 1 362 130 | 1 383 670 | 1 358 128 | 1 354 318 | 1 354 810 | |
| Offset amount | -1 281 848 | -1 281 853 | -1 239 567 | -1 290 342 | -1 284 235 | -1 240 623 | |
| Net amounts presented in the balance sheet | 107 438 | 80 277 | 144 103 | 67 786 | 70 083 | 114 188 | |
| Related amounts not offset in the balance sheet | |||||||
| Financial instruments, netting arrangements | 30 502 | 28 509 | 46 781 | 30 502 | 28 509 | 46 781 | |
| Financial Instruments, collateral | 54 264 | 29 865 | 42 523 | 15 317 | 9 100 | 37 230 | |
| Cash collateral | 16 361 | 8 579 | 39 708 | 17 371 | 21 497 | 18 019 | |
| Total amount not offset in the balance sheet | 101 127 | 66 953 | 129 012 | 63 190 | 59 106 | 102 030 | |
| Net amount | 6 311 | 13 324 | 15 091 | 4 596 | 10 977 | 12 158 |
The amount offset for derivative assets includes offset cash collateral of SEK 16 642m (20 830) derived from the balance sheet item Amounts owed to credit institutions. The amount offset for derivative liabilities
includes offset cash collateral of SEK 25 135m (23 213), derived from the balance sheet item Loans to credit institutions.
This note contains the information made public according to the Swedish Financial Supervisory Authority Regulation FFFS 2014:12, chap. 8. Additional periodic information according to Regulation (EU) No 575/2013 of the European Parliament and of the Council on Supervisory Requirements for Credit Institutions and Implementing Regulation (EU) No 2021/637 of the European Commission can be found on Swedbank's website: https://www.swedbank.com/investorrelations/reports-and-presentations/risk-reports.
In the consolidated situation the Group's insurance companies are consolidated according to the equity method instead of full consolidation. Joint venture companies Entercard Group AB, Invidem AB and P27 Nordic Payments Platform AB consolidates by proportional method instead of the equity method. Otherwise, the same principles for consolidations are applied as for the Group.
| 30 Sep | 30 Jun | 31 Mar | 31 Dec | 30 Sep | |
|---|---|---|---|---|---|
| Consolidated situation, SEKm | 2023 | 2023 | 2023 | 2022 | 2022 |
| Available own funds | |||||
| Common Equity Tier 1 (CET1) capital | 156 880 | 152 511 | 147 702 | 144 107 | 139 624 |
| Tier 1 capital | 171 844 | 167 442 | 162 241 | 153 320 | 149 435 |
| Total capital | 192 499 | 193 791 | 185 944 | 176 331 | 174 137 |
| Risk-weighted exposure amounts | |||||
| Total risk exposure amount | 837 943 | 819 021 | 806 178 | 809 438 | 753 060 |
| Capital ratios as a percentage of risk-weighted exposure amount | |||||
| Common Equity Tier 1 ratio | 18.7 | 18.6 | 18.3 | 17.8 | 18.5 |
| Tier 1 ratio | 20.5 | 20.4 | 20.1 | 18.9 | 19.8 |
| Total capital ratio | 23.0 | 23.7 | 23.1 | 21.8 | 23.1 |
| Additional own funds requirements to address risks other than the risk of | |||||
| excessive leverage as a percentage of risk-weighted exposure amount | |||||
| Additional own funds requirements to address risks other than the risk of excessive | |||||
| leverage | 2.7 | 2.3 | 2.3 | 2.3 | 2.3 |
| of which: to be made up of CET1 capital | 1.8 | 1.5 | 1.5 | 1.5 | 1.5 |
| of which: to be made up of Tier 1 capital | 2.1 | 1.8 | 1.8 | 1.8 | 1.8 |
| Total SREP own funds requirements | 10.7 | 10.3 | 10.3 | 10.3 | 10.3 |
| Combined buffer and overall capital requirement as a percentage of risk | |||||
| weighted exposure amount | |||||
| Capital conservation buffer | 2.5 | 2.5 | 2.5 | 2.5 | 2.5 |
| Conservation buffer due to macro-prudential or systemic risk identified at the level | |||||
| of a Member State | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Institution-specific countercyclical capital buffer | 1.6 | 1.6 | 0.9 | 0.9 | 0.8 |
| Systemic risk buffer | 3.1 | 3.1 | 3.0 | 3.0 | 3.0 |
| Global Systemically Important Institution buffer | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Other Systemically Important Institution buffer | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 |
| Combined buffer requirement | 8.2 | 8.2 | 7.4 | 7.4 | 7.3 |
| Overall capital requirements | 18.9 | 18.4 | 17.7 | 17.7 | 17.6 |
| CET1 available after meeting the total SREP own funds requirements | |||||
| 12.3 | 12.6 | 12.3 | 11.2 | 12.1 | |
| Leverage ratio Total exposure measure |
2 876 831 2 892 936 2 921 562 2 735 019 2 844 556 | ||||
| Leverage ratio, % | 6.0 | 5.8 | 5.6 | 5.6 | 5.3 |
| Additional own funds requirements to address the risk of excessive leverage as a percentage of total exposure measure |
|||||
| Additional own funds requirements to address the risk of excessive leverage | 0.0 | 0 | 0 | 0 | 0 |
| of which: to be made up of CET1 capital | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Total SREP leverage ratio requirements | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 |
| Leverage ratio buffer and overall leverage ratio requirement as a percentage | |||||
| of total exposure measure | |||||
| Leverage ratio buffer requirement | |||||
| Overall leverage ratio requirement | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 |
| Liquidity Coverage Ratio | |||||
| Total high-quality liquid assets, average weighted value | 722 060 | 717 976 | 715 174 | 716 743 | 725 870 |
| Cash outflows, total weighted value | 586 986 | 582 461 | 579 756 | 578 133 | 570 543 |
| Cash inflows, total weighted value | 116 647 | 106 198 | 91 457 | 80 684 | 69 997 |
| Total net cash outflows, adjusted value | 470 339 | 476 264 | 488 298 | 497 449 | 500 545 |
| Liquidity coverage ratio, % | 154.4 | 151.7 | 147.4 | 145.4 | 146.4 |
| Net stable funding ratio | |||||
| Total available stable funding | 1 722 723 1 741 688 1 709 056 1 663 231 1 664 570 | ||||
| Total required stable funding | 1 420 508 1 415 740 1 418 583 1 404 092 1 420 778 | ||||
| Net stable funding ratio, % | 121.3 | 123.0 | 120.5 | 118.5 | 117.2 |
| Common Equity Tier 1 capital | 30 Sep | 31 Dec | 30 Sep |
|---|---|---|---|
| Consolidated situation, SEKm | 2023 | 2022 | 2022 |
| Shareholders' equity according to the Group's balance sheet | 192 942 | 176 064 | 169 212 |
| Anticipated dividend | -12 903 | -10 967 | -7 505 |
| Value changes in own financial liabilities | -255 | -339 | -389 |
| Cash flow hedges | -13 | -13 | -6 |
| Additional value adjustments | -527 | -576 | -828 |
| Goodwill | -14 304 | -13 863 | -14 040 |
| Deferred tax assets | -32 | -106 | -108 |
| Intangible assets | -4 637 | -4 005 | -4 241 |
| Insufficient coverage for non-performing exposures | -41 | -11 | -3 |
| Deductions of CET1 capital due to Article 3 CRR | -134 | -106 | -73 |
| Shares deducted from CET1 capital | -46 | -40 | -33 |
| Pension fund assets | -3 172 | -1 930 | -2 362 |
| Total | 156 880 | 144 107 | 139 624 |
| Risk exposure amount Consolidated situation, SEKm |
30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
|---|---|---|---|
| Risk exposure amount credit risks, standardised approach | 58 583 | 54 992 | 55 594 |
| Risk exposure amount credit risks, IRB | 364 459 | 336 516 | 316 774 |
| Risk exposure amount default fund contribution | 155 | 149 | 264 |
| Risk exposure amount settlement risks | 0 | 0 | 0 |
| Risk exposure amount market risks | 14 537 | 21 461 | 24 997 |
| Risk exposure amount credit value adjustment | 1 774 | 3 809 | 3 328 |
| Risk exposure amount operational risks | 79 995 | 79 995 | 75 618 |
| Additional risk exposure amount, Article 3 CRR | 46 967 | 71 411 | 33 189 |
| Additional risk exposure amount, Article 458 CRR | 271 473 | 241 106 | 243 296 |
| Total | 837 943 | 809 438 | 753 060 |
| SEKm | % | ||||||
|---|---|---|---|---|---|---|---|
| Capital requirements¹ | 30 Sep | 31 Dec | 30 Sep | 30 Sep | 31 Dec | 30 Sep | |
| Consolidated situation, SEKm / % | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 | |
| Capital requirement Pillar 1 | 135 616 | 124 756 | 115 392 | 16.2 | 15.4 | 15.3 | |
| of which Buffer requirements² | 68 581 | 60 001 | 55 147 | 8.2 | 7.4 | 7.3 | |
| Capital requirement Pillar 2³ | 22 373 | 18 374 | 17 094 | 2.7 | 2.3 | 2.3 | |
| Pillar 2 guidance | 4 190 | 8 094 | 7 531 | 0.5 | 1.0 | 1.0 | |
| Total capital requirement including Pillar 2 guidance |
162 179 | 151 225 | 140 017 | 19.4 | 18.7 | 18.6 | |
| Own funds | 192 499 | 176 331 | 174 137 | 0 | 0 | 0 |
1) Swedbank's calculation based on the SFSA's announced capital requirements, including Pillar 2 requirements and Pillar 2 guidance.
2) Buffer requirements includes systemic risk buffer, capital conservation buffer, countercyclical capital buffer and buffer for other systemically important institutions.
3) Individual Pillar 2 requirement according to decision from SFSA SREP 2023.
| SEKm | % | ||||||
|---|---|---|---|---|---|---|---|
| Leverage ratio requirements¹ | 30 Sep | 31 Dec | 30 Sep | 30 Sep | 31 Dec | 30 Sep | |
| Consolidated situation, SEKm / % | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 | |
| Leverage ratio requirement Pillar 1 | 86 305 | 82 051 | 85 337 | 3.0 | 3.0 | 3.0 | |
| Leverage ratio Pillar 2 guidance | 14 384 | 12 308 | 12 801 | 0.5 | 0.5 | 0.5 | |
| Total capital requirement including Pillar 2 guidance |
100 689 | 94 358 | 98 137 | 3.5 | 3.5 | 3.5 | |
| Tier 1 capital | 171 844 | 153 320 | 149 435 | 0 | 0 | 0 |
1) Swedbank's calculation based on the SFSA's announced leverage ratio requirements, including Pillar 2 requirements and Pillar 2 guidance.
This note provides information on the internal capital assessment according to chapter 8, section 5 of the SFSA's regulation on prudential requirements and capital buffers (2014:12). The internal capital assessment is published in the interim report according to chapter 8, section 4 of the SFSA's regulation and general advice on annual reports from credit institutions and investment firms (2008:25).
A bank must identify, measure and manage the risks with which its activities are associated and have sufficient capital to cover these risks. The purpose of the Internal Capital Adequacy Assessment Process (ICAAP) is to ensure that the bank is sufficiently capitalised to cover its risks and to conduct and develop its business activities. Swedbank applies its own models and processes to evaluate its capital need for all relevant risks. The models that serve as a basis for the internal capital assessment evaluate the need for economic capital over a one-year horizon at a 99.9 per cent confidence level for each type of risk. Diversification effects between various types of risks are not taken into account in the calculation of economic capital.
As a complement to the economic capital calculation, scenario-based simulations and stress tests are conducted at least once a year. The analyses provide an overview of the most important risks Swedbank is exposed to by quantifying their impact on the income statement and balance sheet as well as the own funds
Swedbank's earnings are affected by changes in the global marketplace over which it has no control, including macroeconomic factors such as GDP, asset prices and unemployment as well as changes in interest rates, equity prices and exchange rates.
During the quarter, Europe faced multiple geopolitical risks such as the ongoing Russian invasion of Ukraine, unpredictable and increasingly protectionist trade policies, and the aftermath of pandemic-related economic effects. Additionally, climate-related events have added to the challenges faced by the region. The countries bordering the Baltic Sea also share many challenges, particularly due to Russia's impact on the security of the region. The war in Ukraine has had a significant economic and financial impact, particularly on commodity markets. If these effects persist, they can have both global and regional consequences, such as a negative impact on GDP growth and further increases in consumer prices.
Global inflation is declining, but it remains significantly above the monetary policy target levels. Both lowering interest rates too early and keeping them high for too long pose a risk to the economies of the Nordic and Baltic regions, which could ultimately cause an economic downturn and increased unemployment. This concern is exacerbated by relatively high levels of household debt and short-term interest rate binding
and risk-weighted assets. The purpose is to ensure efficient use of capital. This methodology serves as a basis of proactive risk and capital management.
As of 30 September 2023, the internal capital assessment for Swedbank's consolidated situation amounted to SEK 46.7bn (SEK 41.5bn as of 31 December 2022). The capital to meet the internal capital assessment, i.e. the Total capital, amounted to SEK 192.5bn (SEK 176.3bn as of 31 December 2022) (see Note 24). Swedbank's internal capital assessment using its own models is not comparable with the estimated capital requirement that the SFSA releases quarterly and does not consider the SFSA risk-weight floor for Swedish mortgages.
The internally estimated capital requirement for the parent company amounted to SEK 34.7bn (SEK 28.8bn as of 31 December 2022) and the total capital amounted to SEK 140.8bn (SEK 134.6bn as of 31 December 2022) (see the parent company's note on capital adequacy).
In addition to what is stated in this interim report, risk management and capital adequacy according to the Basel III framework are described in more detail in Swedbank's Annual and Sustainability Report 2022 as well as in Swedbank's yearly Risk Management and Capital Adequacy Report, available on www.swedbank.se.
periods in Sweden, making them particularly sensitive to further interest rate hikes.
The Swedish krona has continued to depreciate against several currencies. This can be partly attributed to the rapid interest rate hikes made by the Federal Reserve during the year, which have increased interest rates globally more than in Sweden and thus weakened the Swedish krona. Sweden has also maintained a lower central bank interest rate compared to several major economies for an extended period, which has led to a gradual weakening of the currency. Additionally, Swedish krona is considered a risky currency among the G10 currencies, such that Russia's invasion of Ukraine, high inflation, and financial market uncertainty could have contributed to the Swedish krona's decline.
However, changes in Sweden's Riksbank's currency reserves in September strengthened the Swedish krona's value somewhat. However, if the uncertainty in the financial markets persists, the value of the Swedish krona may continue to be volatile. Nevertheless, fundamental economic factors, such as the balance of payments and economic growth, indicate that the Swedish krona's value is expected to strengthen in the longer term.
The cybersecurity threat level towards the financial sector has been assessed as high during the quarter. Swedbank monitors the situation carefully and can
reassess the level of cybersecurity risks as required. The bank continues to prioritise IT and information security due to increased threats from geopolitical developments and a more elevated terrorism risk in Sweden. Swedbank's capacity to manage these risks is good.
The risk of fraud related to organised crime remains high. Swedbank continually strives to ensure a high level of security for its customers and provides guidance for customers on how to protect themselves against fraud. The banking industry's anti-fraud campaign – "Hard to trick" - continued during the quarter.
For risks related to the ongoing investigations of authorities in US and Estonia related to historic antimoney laundering compliance and response related to anti-money laundering controls, please refer to Note 22 Assets pledged, contingent liabilities and commitments.
The tax area is complex and there can be a scope for different interpretations. Practices and interpretations of applicable laws can be changed, sometimes retroactively. In the event that the tax authorities and, where appropriate, the tax courts decide on a different interpretation than what Swedbank initially made, it could impact the Group's operations, results and financial position.
In addition to what is stated in this interim report, detailed descriptions are provided in Swedbank's 2022 Annual and sustainability report and in the disclosures in the Risk Management and Capital Adequacy reports available at www.swedbank.com.
Impact in SEKm on the net value of assets and liabilities, including derivatives, when market interest rates are increased by one percentage point.
| 30 September 2023 | < 5 yrs | 5-10 yrs | > 10 yrs | Total |
|---|---|---|---|---|
| SEK | -1 438 | 318 | 400 | -720 |
| Foreign currencies | 612 | 362 | 34 | 1 008 |
| Total | -826 | 680 | 434 | 288 |
| 31 December 2022 | ||||
| SEK | -1 423 | -251 | -7 | -1 681 |
| Foreign currencies | 747 | -69 | 17 | 695 |
| Total | -676 | -320 | 10 | -986 |
Impact in SEKm on the net value of assets and liabilities measured at fair value through profit or loss, when market interest rates are increased by one percentage point.
| 30 September 2023 | < 5 yrs | 5-10 yrs | > 10 yrs | Total |
|---|---|---|---|---|
| SEK | 679 | -450 | 350 | 579 |
| Foreign currencies | -1 397 | 533 | -57 | -921 |
| Total | -718 | 83 | 293 | -342 |
| 31 December 2022 | ||||
| SEK | 701 | -249 | -7 | 445 |
| Foreign currencies | -554 | -34 | 29 | -559 |
| Total | 147 | -283 | 22 | -114 |
During the period normal business transactions were executed between companies in the Group, including other related companies such as associates and joint ventures. The five partly owned savings banks are important associates.
| 30 Sep | 31 Dec | 30 Sep | |
|---|---|---|---|
| Number of outstanding ordinary shares | 2023 | 2022 | 2022 |
| Issued shares | |||
| SWED A | 1 132 005 722 1 132 005 722 1 132 005 722 | ||
| Repurchased shares | |||
| SWED A | -7 209 322 | -8 934 918 | -8 934 918 |
| Number of outstanding ordinary shares on the closing day |
1 124 796 400 1 123 070 804 1 123 070 804 | ||
| SWED A | |||
| Last price, SEK | 201.30 | 177.30 | 146.85 |
| Market capitalisation, SEKm | 226 422 | 199 120 | 164 923 |
During 2023, within Swedbank's share-based compensation programme, Swedbank AB transferred 1 725 596 shares at no cost to employees.
| Q3 | Q2 | Q3¹ | Jan-Sep | Jan-Sep¹ | |
|---|---|---|---|---|---|
| Earnings per share | 2023 | 2023 | 2022 | 2023 | 2022 |
| Average number of shares | |||||
| Average number of shares before dilution | 1 124 796 400 1 124 725 789 1 123 070 804 1 124 413 032 1 122 754 238 | ||||
| Weighted average number of shares for potential ordinary shares that incur a dilutive effect due to share |
|||||
| based compensation programme | 2 285 187 | 2 438 823 | 2 585 551 | 2 600 110 | 2 950 193 |
| Average number of shares after dilution | 1 127 081 587 1 127 164 612 1 125 656 355 1 127 013 142 1 125 704 431 | ||||
| Profit, SEKm Profit for the period attributable to shareholders of Swedbank Earnings for the purpose of calculating earnings per share |
9 123 9 123 |
9 122 9 122 |
5 587 5 587 |
25 806 25 806 |
14 576 14 576 |
| Earnings per share, SEK | |||||
| Earnings per share before dilution | 8.11 | 8.11 | 4.97 | 22.95 | 12.98 |
| Earnings per share after dilution | 8.09 | 8.09 | 4.96 | 22.90 | 12.95 |
| Income statement, condensed | Q3 2022 |
Jan-Sep 2022 |
||||
|---|---|---|---|---|---|---|
| Group SEKm |
Previous reporting |
Change | New reporting |
Previous reporting |
Change | New reporting |
| Interest income on financial assets at amortised | ||||||
| cost Other interest income |
11 753 0 |
-3 0 |
11 750 0 |
27 676 182 |
-3 -4 |
27 673 178 |
| Interest income | 11 753 | -3 | 11 750 | 27 858 | -7 | 27 850 |
| Interest expense | -3 392 | 0 | -3 392 | -5 622 | 0 | -5 622 |
| Net interest income (note 5) | 8 360 | -2 | 8 358 | 22 236 | -7 | 22 228 |
| Commission income | 5 693 | -44 | 5 649 | 16 790 | -137 | 16 653 |
| Commission expense | -2 050 | 26 | -2 024 | -6 015 | 54 | -5 961 |
| Net commission income (note 6) | 3 643 | -19 | 3 624 | 10 775 | -83 | 10 692 |
| Net gains and losses on financial items (note 7) | 945 | 18 | 963 | 1 124 | 52 | 1 176 |
| Insurance result | 0 | 361 | 0 | 3 423 | ||
| Return on assets backing insurance liabilities | 0 | -244 | 0 | -3 128 | ||
| Net insurance (note 8) | 423 | -306 | 117 | 1 273 | -978 | 295 |
| Share of profit or loss of associates and joint | ||||||
| ventures | 261 | 0 | 261 | 544 | 0 | 544 |
| Other income | 398 | 0 | 398 | 1 146 | 0 | 1 145 |
| Total income | 14 030 | -310 | 13 720 | 37 097 | -1 017 | 36 080 |
| Staff costs | 3 290 | -99 | 3 191 | 9 771 | -306 | 9 465 |
| Other general administrative expenses (note 9) Depreciation/amortisation of tangible and |
1 621 | -45 | 1 576 | 4 639 | -143 | 4 497 |
| intangible assets | 418 | 0 | 418 | 1 254 | -1 | 1 254 |
| Total expenses | 5 329 | -144 | 5 185 | 15 665 | -450 | 15 215 |
| Profit before impairments, bank taxes and resolution fees |
8 701 | -166 | 8 535 | 21 432 | -567 | 20 865 |
| Impairment of intangible assets (note 15) | 443 | 0 | 443 | 443 | 0 | 443 |
| Impairment of tangible assets | 10 | 0 | 10 | 10 | 0 | 10 |
| Credit impairment (note 10) | 602 | 0 | 602 | 800 | 0 | 800 |
| Bank taxes and resolution fees (note 11) | 466 | 0 | 466 | 1 392 | 0 | 1 392 |
| Profit before tax | 7 180 | -166 | 7 014 | 18 787 | -567 | 18 220 |
| Tax expense | 1 439 | -16 | 1 423 | 3 719 | -79 | 3 640 |
| Profit for the period | 5 741 | -150 | 5 591 | 15 068 | -488 | 14 580 |
| Profit for the period attributable to: Shareholders of Swedbank AB |
5 737 | -150 | 5 587 | 15 064 | -488 | 14 576 |
| Non-controlling interests | 4 | 0 | 4 | 4 | 0 | 4 |
| C/I ratio | 0.38 | 0.00 | 0.38 | 0.42 | 0.00 | 0.42 |
| Earnings per share, SEK | 5.11 | -0.14 | 4.97 | 13.42 | -0.44 | 12.98 |
| Earnings per share after dilution, SEK | 5.10 | -0.14 | 4.96 | 13.38 | -0.43 | 12.95 |
The definition in IFRS 17 of cash flows within insurance contract boundaries includes not only premiums, claims, claim- and policy administration costs but also other overhead costs, both fixed and variable, which relate to the fulfilment of the insurance contract. This new definition means that for the third quarter 2022, administrative expenses in the income statement of SEK 144m was reclassified to the Net insurance line. Net insurance, restated for the third quarter 2022 and including the remeasurement impact, was SEK 306m lower than previously reported.
Due to the fact that IFRS 17 does not allow the unbundling of investment contracts and insurance contracts that was done according to IFRS 4, further minor reclassifications have been made between the income statement lines Net commission income, Net gains and losses on financial items and Net insurance.
| Balance sheet, condensed | 31 Dec 2022 |
30 Sep 2022 |
||||
|---|---|---|---|---|---|---|
| Group SEKm |
Previous reporting |
Change | New reporting |
Previous reporting |
Change | New reporting |
| Assets | ||||||
| Cash and balances with central banks | 365 992 | 0 | 365 992 | 454 584 | 0 | 454 584 |
| Treasury bills and other bills eligible for refinancing with central banks, etc. |
151 483 | 0 | 151 483 | 137 794 | 0 | 137 794 |
| Loans to credit institutions | 56 589 | 0 | 56 589 | 63 463 | 0 | 63 463 |
| Loans to the public | 1 842 811 | 0 | 1 842 811 | 1 845 932 | 0 | 1 845 932 |
| Value change of interest hedged assets in portfolio hedges of interest rate risk |
-20 369 | 0 | -20 369 | -21 691 | 0 | -21 691 |
| Bonds and other interest-bearing securities | 61 298 | 0 | 61 298 | 76 925 | 0 | 76 925 |
| Financial assets for which customers bear the investment risk |
290 678 | -22 084 | 268 594 | 277 217 | -21 387 | 255 830 |
| Shares and participating interests | 8 184 | 22 084 | 30 268 | 5 481 | 21 387 | 26 868 |
| Investments in associates and joint ventures | 7 830 | 0 | 7 830 | 7 610 | 0 | 7 610 |
| Derivatives (note 19) | 50 504 | 0 | 50 504 | 86 985 | 0 | 86 985 |
| Intangible assets (note 15) | 19 886 | 0 | 19 886 | 20 047 | 0 | 20 047 |
| Tangible assets | 5 449 | 0 | 5 449 | 5 169 | 0 | 5 169 |
| Current tax assets | 1 449 | 0 | 1 449 | 2 052 | 0 | 2 052 |
| Deferred tax assets | 159 | 0 | 159 | 167 | 0 | 167 |
| Pension assets | 2 431 | 0 | 2 431 | 3 029 | 3 029 | |
| Other assets | 8 474 | -230 | 8 244 | 26 980 | -170 | 26 810 |
| Prepaid expenses and accrued income | 2 028 | 0 | 2 028 | 2 297 | -1 | 2 296 |
| Total assets | 2 854 876 | -230 | 2 854 646 | 2 994 038 | -170 | 2 993 868 |
| Liabilities and equity | ||||||
| Amounts owed to credit institutions (note 16) | 72 826 | 0 | 72 826 | 175 599 | 0 | 175 599 |
| Deposits and borrowings from the public (note 17) | 1 305 948 | 0 | 1 305 948 | 1 303 098 | 0 | 1 303 098 |
| Financial liabilities for which customers bear the investment risk |
291 993 | -23 101 | 268 892 | 278 436 | -22 285 | 256 151 |
| Debt securities in issue (note 18) | 784 206 | 0 | 784 206 | 826 874 | 0 | 826 874 |
| Short positions, securities | 27 134 | 0 | 27 134 | 31 620 | 0 | 31 620 |
| Derivatives (note 19) | 68 679 | 0 | 68 679 | 70 674 | 0 | 70 674 |
| Current tax liabilities | 1 811 | 0 | 1 811 | 856 | 0 | 856 |
| Deferred tax liabilities | 3 599 | 16 | 3 615 | 4 802 | 20 | 4 822 |
| Pension provisions | 168 | 0 | 168 | 150 | 0 | 150 |
| Insurance provisions | 2 041 | 22 834 | 24 875 | 2 016 | 22 006 | 24 022 |
| Other liabilities and provisions | 26 944 | 40 | 26 984 | 34 983 | 78 | 35 061 |
| Accrued expenses and prepaid income | 4 664 | -7 | 4 657 | 5 008 | -1 | 5 007 |
| Senior non-preferred liabilities (note 18) | 57 439 | 0 | 57 439 | 57 203 | 0 | 57 203 |
| Subordinated liabilities (note 18) | 31 331 | 0 | 31 331 | 33 479 | 0 | 33 479 |
| Total liabilities | 2 678 783 | -217 | 2 678 566 | 2 824 796 | -181 | 2 824 614 |
| Equity | ||||||
| Non-controlling interests | 29 | 0 | 29 | 30 | 0 | 30 |
| Equity attributable to shareholders of the parent company |
176 064 | -12 | 176 052 | 169 212 | 11 | 169 223 |
| Total equity | 176 092 | -12 | 176 080 | 169 242 | 11 | 169 253 |
| Total liabilities and equity | 2 854 876 | -230 | 2 854 646 | 2 994 038 | -170 | 2 993 868 |
IFRS 17 does not allow the unbundling of traditional life insurance that was previously done in accordance with IFRS 4 between investment contracts, reported according to IFRS 9 Financial instruments, and insurance contracts. Instead, traditional life insurance in its entirety is reported as an insurance provision. Consequently, as of 31 December 2022, SEK 23 101m was reclassified in the balance sheet from Liabilities for which the customers bear the investment risk to Insurance provisions. Related assets to traditional life insurance, amounting to SEK 22 084m as of
31 December 2022, was reclassified in the balance sheet from Financial assets for which the customers bear the investment risk to Shares and participating interests.
As of 31 December 2022 the recognised insurance provision according to IFRS 17 amounted to SEK 24 875m, of which SEK 22 790m has been measured according to the general model with direct participation features.
| Balance sheet, condensed | 1 January 2022 |
|||||
|---|---|---|---|---|---|---|
| Group SEKm |
Previous reporting |
Changed presentation |
Remeasuremen t |
New reporting |
||
| Assets | ||||||
| Cash and balances with central banks | 360 153 | 0 | 0 | 360 153 | ||
| Treasury bills and other bills eligible for refinancing | 163 590 | 0 | 0 | 163 590 | ||
| with central banks, etc. | ||||||
| Loans to credit institutions Loans to the public |
39 504 1 703 206 |
0 0 |
0 0 |
39 504 1 703 206 |
||
| Value change of interest hedged assets in portfolio | ||||||
| hedges of interest rate risk | -1 753 | 0 | 0 | -1 753 | ||
| Bonds and other interest-bearing securities | 58 093 | 0 | 0 | 58 093 | ||
| Financial assets for which customers bear the | 328 512 | -24 635 | 0 | 303 877 | ||
| investment risk | ||||||
| Shares and participating interests | 13 416 | 24 635 | 0 | 38 051 | ||
| Investments in associates and joint ventures Derivatives (note 19) |
7 705 40 531 |
0 0 |
0 0 |
7 705 40 531 |
||
| Intangible assets (note 15) | 19 488 | 0 | 0 | 19 488 | ||
| Tangible assets | 5 523 | 0 | 0 | 5 523 | ||
| Current tax assets | 1 372 | 0 | 0 | 1 372 | ||
| Deferred tax assets | 113 | 0 | 0 | 113 | ||
| Other assets | 9 192 | -138 | -42 | 9 012 | ||
| Prepaid expenses and accrued income | 1 970 | 0 | 0 | 1 970 | ||
| Total assets | 2 750 617 | -138 | -42 | 2 750 437 | ||
| Liabilities and equity | ||||||
| Amounts owed to credit institutions (note 16) | 92 812 | 0 | 0 | 92 812 | ||
| Deposits and borrowings from the public (note 17) | 1 265 783 | 0 | 0 | 1 265 783 | ||
| Financial liabilities for which customers bear the | 329 667 | -25 486 | 0 | 304 181 | ||
| investment risk | ||||||
| Debt securities in issue (note 18) | 735 917 | 0 | 0 | 735 917 | ||
| Short positions, securities | 28 613 | 0 | 0 | 28 613 | ||
| Derivatives (note 19) | 28 106 | 0 | 0 | 28 106 | ||
| Current tax liabilities Deferred tax liabilities |
672 3 398 |
0 0 |
0 96 |
672 3 494 |
||
| Pension provisions | 1 801 | 0 | 0 | 1 801 | ||
| Insurance provisions | 1 970 | 25 309 | -622 | 26 657 | ||
| of which general model without direct participation features |
0 | 212 | 0 | 212 | ||
| of which general model with direct participation features |
0 | 25 222 | 0 | 25 222 | ||
| of which premium allocation approach | 0 | 1 223 | 0 | 1 223 | ||
| Other liabilities and provisions | 28 934 | 44 | 0 | 28 978 | ||
| Accrued expenses and prepaid income | 4 813 | -6 | 0 | 4 807 | ||
| Senior non-preferred liabilities (note 18) | 37 832 | 0 | 0 | 37 832 | ||
| Subordinated liabilities (note 18) | 28 604 | 0 | 0 | 28 604 | ||
| Total liabilities | 2 588 921 | -138 | -526 | 2 588 257 | ||
| Equity | ||||||
| Non-controlling interests | 26 | 0 | 0 | 26 | ||
| Equity attributable to shareholders of the parent company |
161 670 | 0 | 484 | 162 155 | ||
| Total equity | 161 696 | 0 | 484 | 162 181 | ||
| Total liabilities and equity | 2 750 617 | -138 | -42 | 2 750 437 |
| Parent company SEKm |
Q3 2023 |
Q2 2023 |
Q3 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
|---|---|---|---|---|---|
| Interest income on financial assets at amortised cost | 19 580 | 18 672 | 6 961 | 53 936 | 13 290 |
| Other interest income | 4 027 | 2 823 | 1 917 | 9 302 | 5 114 |
| Interest income | 23 607 | 21 495 | 8 878 | 63 238 | 18 404 |
| Interest expense | -16 323 | -14 093 | -3 367 | -41 727 | -4 474 |
| Net interest income | 7 284 | 7 402 | 5 512 | 21 512 | 13 931 |
| Dividends received | 1 463 | 1 370 | 2 300 | 9 095 | 11 957 |
| Commission income | 2 284 | 2 321 | 2 164 | 6 807 | 6 457 |
| Commission expense | -574 | -586 | -546 | -1 662 | -1 697 |
| Net commission income | 1 711 | 1 736 | 1 618 | 5 145 | 4 760 |
| Net gains and losses on financial items | 717 | 528 | -212 | 1 587 | -1 773 |
| Other income | 981 | 965 | 750 | 2 869 | 2 202 |
| Total income | 12 156 | 12 001 | 9 967 | 40 208 | 31 077 |
| Staff costs | 2 894 | 2 885 | 2 629 | 8 663 | 7 760 |
| Other expenses | 1 615 | 1 709 | 1 478 | 4 881 | 4 260 |
| Depreciation/amortisation and impairment of tangible and intangible | |||||
| fixed assets | 1 325 | 1 379 | 1 289 | 3 969 | 3 794 |
| Administrative fines¹ | -40 | 0 | 850 | 0 | |
| Total expenses | 5 834 | 5 933 | 5 396 | 18 362 | 15 814 |
| Profit before impairments, Swedish bank tax and resolution fees | 6 323 | 6 068 | 4 572 | 21 845 | 15 263 |
| Credit impairments, net | -11 | 123 | 337 | 658 | 456 |
| Impairment of financial assets² | 125 | 0 | 125 | 0 | |
| Swedish bank tax and resolution fees | 338 | 339 | 279 | 1 014 | 838 |
| Operating profit | 5 996 | 5 481 | 3 955 | 20 048 | 13 968 |
| Tax expense | 1 344 | 1 243 | 867 | 3 687 | 2 240 |
| Profit for the period | 4 652 | 4 238 | 3 088 | 16 361 | 11 729 |
1) During the first quarter a provision was made related to the Office of Foreign Assets Control (OFAC) of SEK 40m. During the second quarter an agreement was reached with OFAC. The provision was reversed and has been recognised in Swedbank AS in Latvia.
2) Impairment of financial assets refers to impairment of Invidem AB.
| Parent company | Q3 | Q2 | Q3 | Jan-Sep | Jan-Sep |
|---|---|---|---|---|---|
| SEKm | 2023 | 2023 | 2022 | 2023 | 2022 |
| Profit for the period reported via income statement | 4 652 | 4 238 | 3 088 | 16 361 | 11 729 |
| Total comprehensive income for the period | 4 652 | 4 238 | 3 088 | 16 361 | 11 729 |
| Parent company SEKm |
30 Sep 2023 |
31 Dec 2022 |
30 Sep 2022 |
|---|---|---|---|
| Assets | |||
| Cash and balances with central banks | 189 148 | 215 314 | 306 499 |
| Loans to credit institutions | 796 537 | 830 322 | 773 182 |
| Loans to the public | 473 181 | 470 187 | 480 914 |
| Interest-bearing securities | 362 308 | 204 942 | 208 596 |
| Shares and participating interests | 94 825 | 70 434 | 69 392 |
| Derivatives | 63 745 | 67 764 | 103 705 |
| Other assets | 37 989 | 39 794 | 53 836 |
| Total assets | 2 017 732 1 898 757 1 996 124 | ||
| Liabilities and equity | |||
| Amounts owed to credit institutions | 209 743 | 162 348 | 185 930 |
| Deposits and borrowings from the public | 923 192 | 943 777 | 969 566 |
| Value change of the hedged liabilities in portfolio hedges of interest rate risk |
1 | ||
| Debt securities in issue | 489 448 | 435 782 | 474 148 |
| Derivatives | 83 443 | 100 346 | 101 297 |
| Other liabilities and provisions | 52 870 | 50 865 | 61 247 |
| Senior non-preferred liabilities | 103 187 | 57 439 | 57 203 |
| Subordinated liabilities | 33 373 | 31 331 | 33 479 |
| Untaxed reserves | 5 367 | 5 367 | 10 630 |
| Equity | 117 108 | 111 502 | 102 624 |
| Total liabilities and equity | 2 017 732 1 898 757 1 996 124 | ||
| Pledged collateral | 128 642 | 82 473 | 67 681 |
| Other assets pledged | 14 826 | 14 287 | 8 627 |
| Contingent liabilities | 93 488 | 132 608 | 142 273 |
| Commitments | 247 467 | 253 613 | 249 718 |
| SEKm | |||||
|---|---|---|---|---|---|
| Restricted equity | Non-restricted equity | ||||
| January-September 2023 | Share capital | Statutory reserve |
Share premium reserve |
Retained earnings |
Total |
| Opening balance 1 January 2023 | 24 904 | 5 968 | 13 206 | 67 424 | 111 502 |
| Dividend | -10 964 | -10 964 | |||
| Share based payments to employees | 194 | 194 | |||
| Deferred tax related to share based payments to employees |
-2 | -2 | |||
| Current tax related to share based payments to employees |
17 | 17 | |||
| Total comprehensive income for the period | 16 361 | 16 361 | |||
| Closing balance 30 September 2023 | 24 904 | 5 968 | 13 206 | 73 030 | 117 108 |
| January-December 2022 | |||||
| Opening balance 1 January 2022 | 24 904 | 5 968 | 13 206 | 59 343 | 103 421 |
| Dividend | -12 632 | -12 632 | |||
| Share based payments to employees | 174 | 174 | |||
| Deferred tax related to share based payments to employees |
4 | 4 | |||
| Current tax related to share based payments to employees |
-1 | -1 | |||
| Total comprehensive income for the period | 20 536 | 20 536 | |||
| Closing balance 31 December 2022 | 24 904 | 5 968 | 13 206 | 67 424 | 111 502 |
| January-September 2022 | |||||
| Opening balance 1 January 2022 | 24 904 | 5 968 | 13 206 | 59 343 | 103 421 |
| Dividend | -12 632 | -12 632 | |||
| Share based payments to employees | 113 | 113 | |||
| Deferred tax related to share based payments to employees |
-5 | -5 | |||
| Current tax related to share based payments to employees |
-1 | -1 | |||
| Total comprehensive income for the period | 11 729 | 11 729 |
Closing balance 30 September 2022 24 904 5 968 13 206 58 547 102 625
| Parent company SEKm |
Jan-Sep 2023 |
Full-year 2022 |
Jan-Sep 2022 |
|---|---|---|---|
| Cash flow from operating activities | -65 547 | -2 081 | 85 302 |
| Cash flow from investing activities | 7 126 | 12 223 | 14 220 |
| Cash flow from financing activities | 32 255 | 10 819 | 12 624 |
| Cash flow for the period | -26 166 | 20 961 | 112 146 |
| Cash and cash equivalents at beginning of period | 215 314 | 194 353 | 194 353 |
| Cash flow for the period | -26 166 | 20 961 | 112 146 |
| Cash and cash equivalents at end of period | 189 148 | 215 314 | 306 499 |
| 30 Sep | 30 Jun | 31 Mar | 31 Dec | 30 Sep | |
|---|---|---|---|---|---|
| Parent company, SEKm | 2023 | 2023 | 2023 | 2022 | 2022 |
| Available own funds | |||||
| Common equity tier 1 (CET1) capital | 106 441 | 106 100 | 106 324 | 102 528 | 100 941 |
| Tier 1 capital | 121 405 | 121 031 | 120 863 | 111 742 | 110 753 |
| Total capital | 140 837 | 146 348 | 143 484 | 134 563 | 135 353 |
| Risk-weighted exposure amounts | |||||
| Total risk exposure amount | 414 671 | 393 039 | 381 565 | 394 817 | 395 783 |
| Capital ratios as a percentage of risk-weighted exposure amount | |||||
| Common equity tier 1 ratio | 25.7 | 27.0 | 27.9 | 26.0 | 25.5 |
| Tier 1 ratio | 29.3 | 30.8 | 31.7 | 28.3 | 28.0 |
| Total capital ratio | 34.0 | 37.2 | 37.6 | 34.1 | 34.2 |
| Additional own funds requirements to address risks other than the risk of excessive leverage as a percentage of risk-weighted exposure amount |
|||||
| Additional own funds requirements to address risks other than the risk of excessive | |||||
| leverage | 1.2 | 2.1 | 2.1 | 2.1 | 2.1 |
| of which: to be made up of CET1 capital | 0.8 | 1.4 | 1.4 | 1.4 | 1.4 |
| of which: to be made up of Tier 1 capital | 0.9 | 1.6 | 1.6 | 1.6 | 1.6 |
| Total SREP own funds requirements | 9.2 | 10.1 | 10.1 | 10.1 | 10.1 |
| Combined buffer and overall capital requirement as a percentage of risk weighted exposure amount |
|||||
| Capital conservation buffer | 2.5 | 2.5 | 2.5 | 2.5 | 2.5 |
| Conservation buffer due to macro-prudential or systemic risk identified at the level of a Member State |
|||||
| Institution-specific countercyclical capital buffer | 1.7 | 1.6 | 0.9 | 0.9 | 0.8 |
| Systemic risk buffer | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Global Systemically Important Institution buffer | |||||
| Other Systemically Important Institution buffer | |||||
| Combined buffer requirement | 4.2 | 4.1 | 3.4 | 3.4 | 3.3 |
| Overall capital requirements | 13.4 | 14.2 | 13.5 | 13.5 | 13.4 |
| CET1 available after meeting the total SREP own funds requirements | 20.4 | 21.1 | 21.9 | 20.0 | 19.6 |
| Leverage ratio | |||||
| Total exposure measure | 1 532 147 1 529 710 1 521 947 1 340 798 1 463 298 | ||||
| Leverage ratio, % | 7.9 | 7.9 | 7.9 | 8.3 | 7.6 |
| Additional own funds requirements to address the risk of excessive leverage as a percentage of total exposure measure |
|||||
| Additional own funds requirements to address the risk of excessive leverage | |||||
| of which: to be made up of CET1 capital | |||||
| Total SREP leverage ratio requirements | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 |
| Leverage ratio buffer and overall leverage ratio requirement as a percentage | |||||
| of total exposure measure | |||||
| Leverage ratio buffer requirement | |||||
| Overall leverage ratio requirement | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 |
| Liquidity coverage ratio | |||||
| Total high-quality liquid assets, average weighted value | 595 633 | 581 236 | 560 888 | 560 040 | 564 761 |
| Cash outflows, total weighted value | 598 493 | 591 762 | 597 651 | 607 726 | 596 307 |
| Cash inflows, total weighted value Total net cash outflows, adjusted value |
110 777 487 717 |
101 490 490 272 |
90 039 507 612 |
81 543 526 182 |
70 901 525 406 |
| Liquidity coverage ratio, % | 122.5 | 119.0 | 111.1 | 106.7 | 107.8 |
| Net stable funding ratio Total available stable funding |
1 044 967 1 039 516 1 032 023 1 014 113 1 015 807 | ||||
| Total required stable funding | 601 829 | 589 546 | 601 344 | 593 123 | 598 193 |
| Net stable funding ratio, % | 173.6 | 176.3 | 171.6 | 171.0 | 169.9 |
| Risk exposure amount | 30 Sep | 31 Dec | 30 Sep |
|---|---|---|---|
| Parent company, SEKm | 2023 | 2022 | 2022 |
| Risk exposure amount credit risks, standardised approach | 124 543 | 103 867 | 103 403 |
| Risk exposure amount credit risks, IRB | 192 151 | 180 802 | 180 861 |
| Risk exposure amount default fund contribution | 155 | 149 | 264 |
| Risk exposure amount settlement risks | 0 | 0 | 0 |
| Risk exposure amount market risks | 14 468 | 21 352 | 25 080 |
| Risk exposure amount credit value adjustment | 1 768 | 3 801 | 3 323 |
| Risk exposure amount operational risks | 42 408 | 42 408 | 40 218 |
| Additional risk exposure amount, Article 3 CRR | 2 200 | 33 658 | 32 658 |
| Additional risk exposure amount, Article 458 CRR | 36 978 | 8 782 | 9 975 |
| Total | 414 671 | 394 817 | 395 783 |
| SEKm | % | |||||
|---|---|---|---|---|---|---|
| Capital requirements¹ | 30 Sep | 31 Dec | 30 Sep | 30 Sep | 31 Dec | 30 Sep |
| Parent company, SEKm / % | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 |
| Capital requirement Pillar 1 | 50 393 | 44 870 | 44 723 | 12.2 | 11.4 | 11.3 |
| of which Buffer requirements² | 17 219 | 13 285 | 13 061 | 4.2 | 3.4 | 3.3 |
| Capital requirement Pillar 2³ | 5 100 | 8 291 | 8 311 | 1.2 | 2.1 | 2.1 |
| Total capital requirement including Pillar 2 guidance | 55 494 | 53 161 | 53 035 | 13.4 | 13.5 | 13.4 |
| Own funds | 140 837 | 134 563 | 135 353 | 0 | 0 | 0 |
1) Swedbank's calculation based on the SFSA's announced capital requirements, including Pillar 2 requirements and Pillar 2 guidance.
2) Buffer requirements includes capital conservation buffer and countercyclical capital buffer.
3) Individual Pillar 2 requirement according to decision from SFSA SREP 2023.
| SEKm | % | |||||
|---|---|---|---|---|---|---|
| Leverage ratio requirements¹ | 30 Sep | 31 Dec | 30 Sep | 30 Sep | 31 Dec | 30 Sep |
| Parent company, SEKm / % | 2023 | 2022 | 2022 | 2023 | 2022 | 2022 |
| Leverage ratio requirement Pillar 1 | 45 964 | 40 224 | 43 899 | 3.0 | 3.0 | 3.0 |
| Total leverage ratio requirement including Pillar 2 guidance |
45 964 | 40 224 | 43 899 | 3.0 | 3.0 | 3.0 |
| Tier 1 capital | 121 405 | 111 742 | 110 753 | 0 | 0 | 0 |
1) Swedbank's calculation based on the SFSA's announced leverage ratio requirements, including Pillar 2 requirements and Pillar 2 guidance.
Swedbank prepares its financial statements in accordance with IFRS as adopted by the EU, as set out in Note 1. The interim report includes a number of alternative performance measures, which exclude certain items that management believes are not representative of the underlying/ongoing performance of the business. Therefore the alternative performance measures provide more comparative information between periods. Management believes that inclusion of these measures provides information to the readers that enable comparability between periods.
| Measure and definition | Purpose |
|---|---|
| Net investment margin before trading interest is deducted | |
| Calculated as Net interest income before trading-related interest is deducted, in relation to average total assets. The average is calculated using month end figures1, including the prior year end. The nearest IFRS measure is Net interest income and can be reconciled in Note 5. |
Considers all interest income and interest expense, independent of how it has been presented in the income statement. |
| Allocated equity | |
| Allocated equity is the operating segment's equity measure and is not directly required by IFRS. The Group's equity attributable to shareholders is allocated to each operating segment based on capital adequacy rules and estimated capital requirements based on the bank's internal Capital Adequacy Assessment Process (ICAAP). The allocated equity amounts per operating segment are reconciled to the Group Total equity, the nearest IFRS measure, in Note 4. |
Used by Group Management for internal governance and operating segment performance management purposes. |
| Return on allocated equity | |
| Calculated based on profit for the period (annualised) attributable to the shareholders for the operating segment, in relation to average allocated equity for the operating segment. The average is calculated using month-end figures1, including the prior year end. The allocated equity amounts per operating segment are reconciled to the Group Total equity, the nearest IFRS measure, in Note 4. |
Used by Group Management for internal governance and operating segment performance management purposes. |
| Income statement excluding expenses for the administrative fines | |
| Amount related to expenses is presented excluding expenses for administrative fines. The amounts are reconciled to the relevant IFRS income statement lines on page 6. |
Provides comparability of figures between reporting periods. |
| Return on equity excluding expenses for administrative fines | |
| Calculated based on profit for the period (annualised) attributable to the shareholders excluding expenses for the administrative fines, in relation to average equity attributable to shareholders' of the parent company. The average is calculated using month-end figures1, including the prior year end. Profit for the period attributable to shareholders excluding expenses for administrative fines are reconciled to Profit for the period allocated to shareholders, the nearest IFRS measure, on page 6. |
Provides comparability of figures between reporting periods. |
| Cost/Income ratio excluding expenses for administrative fines | |
| Total expenses excluding expenses related to administrative fines in relation to total income. Total expenses excluding expense for administrative fines is reconciled to Total expenses, the nearest IFRS measure, on page 6. |
Provides comparability of figures between reporting periods. |
1) The month-end figures used in the calculation of the average can be found on page 68 of the Fact book.
1) The month-end figures used in the calculation of the average can be found on page 68 of the Fact book.
Used by Group Management for internal governance and operating segment performance management purposes.
The Board of Directors and the President hereby certify that the Interim report for January-September 2023 provides a fair and accurate overview of the operations, position and results of the parent company and the Group and describes the significant risks and uncertainties faced by the parent company and the companies in the Group.
Stockholm, 25 October 2023
Göran Persson Chair
Board Member Board Member Board Member Board Member
Göran Bengtsson Annika Creutzer Hans Eckerström Kerstin Hermansson
Helena Liljedahl Bengt Erik Lindgren Anna Mossberg Per Olof Nyman Board Member Board Member Board Member Board member
Biljana Pehrsson Biörn Riese Board Member Board Member
Roger Ljung Åke Skoglund Board Member Board Member
Employee Representative Employee Representative
Jens Henriksson President and CEO
We have reviewed the condensed interim financial information (interim report) of Swedbank AB (publ) as of 30 September 2023 and the nine-month period then ended. The Board of Directors and the CEO are responsible for the preparation and presentation of the interim financial information in accordance with IAS 34 and the Annual Accounts Act for credit institutions and securities companies. Our responsibility is to express a conclusion on this interim report based on our review.
We conducted our review in accordance with the International Standard on Review Engagements ISRE 2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Annual Accounts Act for credit institutions and securities companies, regarding the Group, and with the Annual Accounts Act for credit institutions and securities companies, regarding the Parent Company.
Stockholm, 26 October 2023
PricewaterhouseCoopers AB
Anneli Granqvist Martin By Authorised Public Accountant Authorised Public Accountant Auditor in charge
The Group's financial reports can be found on www.swedbank.com/ir
| Year-end report 2023 | 24 January 2024 |
|---|---|
| Annual and sustainability report 2023 | 22 February 2024 |
| Annual General Meeting | 26 March 2024 |
| Interim report for the first quarter 2024 | 25 April 2024 |
| Interim report for the second quarter 2024 | 16 July 2024 |
| Interim report for the third quarter 2024 | 23 October 2024 |
| Jens Henriksson | Anders Karlsson |
|---|---|
| President and CEO | CFO |
| Telephone +46 8 585 934 82 | Telephone +46 8 585 938 75 |
Unni Jerndal
Annie Ho Head of Investor Relations Telephone +46 70 343 7815
Erik Ljungberg Head of Group Communications and Sustainability Telephone +46 73 988 3557
Senior Advisor Telephone +46 8 585 938 69 +46 73 092 11 80
Information on Swedbank's strategy, values and share is also available on www.swedbank.com.
Swedbank AB (publ) Registration no. 502017-7753
Head office
Visiting adress: Landsvägen 40 172 63 Sundbyberg
Postal address: Swedbank AB SE-105 34 Stockholm, Sweden
Telephone +46 8 585 900 00 www.swedbank.com
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