Swedbank A

Annual Report • Feb 2, 2022

Q4 2021

Year-end report 2021, 2 February 2022

Interim report for the fourth quarter 2021

Fourth quarter 2021 compared with third quarter 2021

• Stable income and expenses according to plan
• Net commission income reaches new record level
• Continued high mortgage growth and increased fund savings
• Low credit impairments and continued good credit quality
• Proposed dividend of SEK 11.25 per share including a special dividend of SEK 2 per share

"Swedbank stands strong in an uncertain time"

Jens Henriksson, President and CEO

Financial information	Q4	Q3		Full-year	Full-year
SEKm	2021	2021	%	2021	2020	%
Total income	11 749	11 869	-1	46 890	45 676	3
Net interest income	6 554	6 590	-1	26 257	26 853	-2
Net commission income	4 020	3 799	6	14 853	12 770	16
Net gains and losses on financial items	265	553	-52	2 048	2 655	-23
Other income1	910	927	-2	3 732	3 398	10
Total expenses	5 842	5 042	16	20 847	24 560	-15
of which adminstrative fine	0	0		0	4 000
Profit before impairment	5 907	6 827	-13	26 043	21 116	23
Impairment of intangible and tangible assets	0	0		56	2
Credit impairment	-67	18		170	4 334	-96
Profit before tax	5 974	6 809	-12	25 817	16 780	54
Tax expense	1 139	1 310	-13	4 945	3 851	28
Profit for the period	4 835	5 499	-12	20 872	12 929	61
Profit for the period attributable to:
Shareholders of Swedbank AB	4 835	5 498	-12	20 871	12 929	61
Earnings per share, SEK, after dilution	4.30	4.89		18.56	11.51
Return on equity, %	12.0	13.6		13.2	8.9
Return on equity excl. administrative fine, %	12.0	13.6		13.2	11.4
C/I ratio	0.50	0.42		0.44	0.54
C/I ratio excl. administrative fine	0.50	0.42		0.44	0.45
Common Equity Tier 1 capital ratio, %	18.3	18.5		18.3	17.5
Credit impairment ratio, %	-0.02	0.00		0.01	0.26

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.

CEO Comment

Swedbank stands strong at a time of great uncertainty. The increased spread of Covid has led to new restrictions in all our home markets. In spite of this, the economies are developing well. However, continued global supply problems have again held back economic growth and increased inflation. Several central banks signalled that they would tighten monetary policy. Geopolitical developments have increasingly come into focus.

Swedbank's profit in the fourth quarter amounted to SEK 4.8bn with stable net interest income and commission income at a new record high. Expenses rose on a seasonal basis and for the full-year 2021 ended up just below our cost cap of SEK 20.5bn excluding investigation expenses. For 2022 the cost cap is unchanged but excludes the new bank tax. The return on equity was 12.0 per cent in the quarter and 13.2 per cent for the full-year 2021. Our target of a 15 per cent return remains unchanged regardless of the bank tax. Before the end of the year we will present a plan how we can reach the target.

Swedbank's capital and liquidity position remains strong with a buffer relative to the Swedish FSA's capital requirement of 4.6 percentage points. In November, the remaining dividend for 2019 and 2020 was paid out. In accordance with the bank's dividend policy, a dividend for 2021 of SEK 9.25 per share is proposed. Additionally, the strong capital position allows for a special dividend of SEK 2 per share. Hence the Board of Directors proposes a total dividend of SEK 11.25 per share to the Annual General Meeting. The bank's dividend policy of 50 per cent of annual profits remains. Dividends to our shareholders are important.

The Swedish housing market remained strong despite price increases slowing somewhat. Swedbank has consolidated its market-leading position in new mortgage sales. The measures to more quickly meet our customers' needs have produced results. We are also the mortgage leader in Estonia, Latvia and Lithuania.

Savings has been our core business for over 200 years. Saving in funds increased in the quarter in all our home markets. Above all, it was the personal advice at the branches which generated the higher inflows. Customer demand is constantly changing and technological developments enable new solutions and services. Easily accessible advice in our digital channels easily transitions to virtual meetings. Based on the customer's needs, we can listen, discuss and offer personalised advice to contribute to their financial health.

Swedbank Robur is Sweden's largest fund company and has a consistently green fund offering strongly focused on sustainability. During the quarter, Swedbank Robur established new targets and methods for its climate work. Carbon emissions for assets under management in equities and corporate bonds were halved between 2017 and 2020. Swedbank Robur is on track to meet its ambitious goal that assets under management align with the Paris Agreement as early as 2025.

Swedbank decided last year to no longer directly finance unconventional prospecting of fossil fuels or new oil and gas fields. Now we are taking the next step and will not directly finance either new oil tankers or new investments in crude oil refineries for transportation fuel. Our vision of a financially sound and sustainable society takes precedence.

We continue to develop our digital services and invest in increased functionality. Demand for help with day-to-day banking services was down by 15 per cent in 2021 in our customer centres and branches. In the Baltic countries, the mortgage process now is fully digital.

Estonia, Latvia and Lithuania are rapidly growing and demand for financial services is increasing in line with the economic development. This year we held more than 200 virtual seminars and podcasts for customers as well as more than 900 courses for students. In Sweden, we were named "Public Educator of the Year" by the business magazine Privata Affärer. We had over 90 000 students participate in the Young Economy course we provided as well as 4 400 seniors in the "Digital Economy" course. With increased knowledge, the foundation is laid for sound and sustainable personal finances.

Trust in the bank in Sweden is increasing in both our own surveys and external surveys. In the Baltic countries, trust has remained very high and customer satisfaction among businesses is rising.

Our collaboration with the savings banks is pivotal and is based on common values. During the quarter, the cooperation agreement was extended and our shared range of services and products thereby reaches a total of 6 million customers in Sweden. The savings bank collaboration continues to develop to the benefit of customers.

The U.S. authorities are continuing to investigate the bank. The various investigations are at different stages. As we have previously stated, we cannot determine the scope of any fines or when the investigations will be completed.

We are carefully monitoring the pandemic, which is currently causing large numbers of people to call in sick from work in society at large and among Swedbank's staff. The bank stands strong in an uncertain time, however. Our purpose is to enable the many people and businesses to create a better future. Our customers' future is our focus.

Jens Henriksson President and CEO

Table of contents

	Page
Market	5
Important to note	5
Group development	5
Result fourth quarter 2021 compared with third quarter 2021	5
Result full-year 2021 compared with full-year 2020	6
Volume trend by product area	7
Credit and asset quality	8
Operational risks	9
Funding and liquidity	9
Ratings	9
Capital and capital adequacy	9
Investigations	10
Other events	11
Events after 31 December 2021	11
Business areas
Swedish Banking	12
Baltic Banking	14
Large Corporates & Institutions	16
Group Functions & Other	18
Eliminations	19
Group
Income statement, condensed	21
Statement of comprehensive income, condensed	22
Balance sheet, condensed	23
Statement of changes in equity, condensed	24
Cash flow statement, condensed	25
Notes	26
Parent company	50
Alternative performance measures	55
Signatures of the Board of Directors and the President	57
Review report	57
Contact information	58

More detailed information can be found in Swedbank's Fact book, www.swedbank.com/ir, under Financial information and publications.

Financial overview

Income statement	Q4	Q3		Q4		Full-year	Full-year
SEKm	2021	2021	%	2020	%	2021	2020	%
Net interest income	6 554	6 590	-1	6 567	0	26 257	26 853	-2
Net commission income	4 020	3 799	6	3 376	19	14 853	12 770	16
Net gains and losses on financial items	265	553	-52	910	-71	2 048	2 655	-23
Other income1	910	927	-2	911	0	3 732	3 398	10
Total income	11 749	11 869	-1	11 764	0	46 890	45 676	3
Staff costs	3 361	3 127	7	3 205	5	12 739	11 873	7
Other expenses	2 481	1 915	30	2 381	4	8 108	8 687	-7
Administrative fine	0	0		0		0	4 000
Total expenses	5 842	5 042	16	5 586	5	20 847	24 560	-15
Profit before impairment	5 907	6 827	-13	6 178	-4	26 043	21 116	23
Impairment of intangible assets	0	0		0		56	0
Impairment of tangible assets	0	0		1		0	2
Credit impairment	-67	18		523		170	4 334	-96
Profit before tax	5 974	6 809	-12	5 654	6	25 817	16 780	54
Tax expense	1 139	1 310	-13	1 144	0	4 945	3 851	28
Profit for the period	4 835	5 499	-12	4 510	7	20 872	12 929	61
Profit for the period attributable to:
Shareholders of Swedbank AB	4 835	5 498	-12	4 510	7	20 871	12 929	61

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.

	Q4	Q3	Q4	Full-year	Full-year
Key ratios and data per share	2021	2021	2020	2021	2020
Return on equity, %	12.0	13.6	11.8	13.2	8.9
Earnings per share before dilution, SEK1	4.31	4.90	4.03	18.62	11.55
Earnings per share after dilution, SEK1	4.30	4.89	4.01	18.56	11.51
C/I ratio	0.50	0.42	0.47	0.44	0.54
Equity per share, SEK1	144.2	146.8	138.5	144.2	138.5
Loan/deposit ratio, %	133	127	143	133	143
Common Equity Tier 1 capital ratio, %	18.3	18.5	17.5	18.3	17.5
Tier 1 capital ratio, %	20.2	20.3	18.7	20.2	18.7
Total capital ratio, %	22.4	22.6	21.0	22.4	21.0
Credit impairment ratio, %	-0.02	0.00	0.12	0.01	0.26
Share of Stage 3 loans, gross, %	0.37	0.40	0.62	0.37	0.62
Total credit impairment provision ratio, %	0.29	0.35	0.48	0.29	0.48
Liquidity coverage ratio (LCR), %	163	149	174	163	174
Net stable funding ratio (NSFR), %	123	124	125	123	125

1) The number of shares and calculation of earnings per share are specified on page 49.

Balance sheet data SEKbn	31 Dec 2021	31 Dec 2020	%
Loans to the public, excl. the Swedish National Debt Office and repurchase agreements Deposits from the public, excl. the Swedish National Debt Office and repurchase	1 679	1 616	4
agreements	1 261	1 131	11
Equity attributable to shareholders of the parent company	162	155	5
Total assets	2 751	2 595	6
Risk exposure amount	708	690	3

Definitions of all key ratios can be found in Swedbank's Fact book on page 78.

Market

The economic recovery during the year was broadbased. The spread of Covid in Europe has risen to the highest levels during the pandemic and several countries have reintroduced restrictions. Sweden has also introduced new restrictions to slow the spread and reduce the impact on society. While we expect the economic impact of Omicron to be fairly brief, the reintroduced restrictions mean that it will take time before spending on services fully recovers.

The decline that followed the pandemic's outbreak in the Swedish and Baltic economies has been recouped, despite the growth rate in the fourth quarter falling slightly. In addition to the effects of new variants, global supply constraints and shortages of qualified manpower have continued to slow production. The labour shortages have been especially noticeable in the Baltic countries, where wage increases have accelerated.

The financial markets were also affected by the new variant and stocks have declined somewhat on a global basis. The capital markets recovered at the end of the year, however, before closing at or near a yearly high. The krona weakened slightly against the U.S. dollar and euro. Oil prices were volatile, but recovered to just under USD 80 dollar a barrel in December after having fallen significantly during the quarter.

Several central banks have signalled that tighter monetary policy is imminent to prevent the currently high inflation rate from taking hold. We expect the Riksbank to begin reducing holdings of securities around the mid-year and raise the repo rate twice in 2023, which is earlier than what it had announced.

In the Baltic countries, December inflation ranged between 8 and nearly 12 per cent on an annual basis. To some extent the impact of the high inflation is offset by a continued rapid rise in wages. In Sweden, inflation in November was over 4 per cent on an annual basis, but since wages did not rise at the same pace, Swedish households saw their purchasing power decline last autumn.

House prices in Sweden rose by 11 per cent in the quarter compared with the same quarter in 2020, a significantly slower pace than earlier in the year. On a full-year basis, house prices were up nearly 15 per cent. In 2022, we expect prices to continue to rise by approximately 5 per cent, since borrowers should still be in a good financial situation and mortgage rates are expected to increase at a fairly slow rate. Together with the continued high turnover in the housing market, this suggests a further increase in credit growth. During the quarter, lending for home purchases rose by an average of 7.1 per cent on an annual basis.

In the Baltic countries, house prices continue to rise at a fairly rapid rate. In Estonia and Lithuania, the annual price increase is over 15 per cent in the two capitals, while in Riga it is between 5 and 10 per cent. Just like in Sweden, Baltic consumers have been able to save more during the pandemic while spending less. In Estonia, a pension reform also increased the liquid savings of households. Because of this, credit growth in the region has not risen at the same rate as house prices.

Important to note

In accordance with the bank's dividend policy, the Board of Directors is proposing a dividend of SEK 9.25 per share for the financial year 2021. Additionally, the strong capital position allows for a special dividend of SEK 2 per share. Hence the Board of Directors proposes a total dividend of SEK 11.25 per share to the Annual General Meeting. The bank's dividend policy ratio of 50 per cent of annual profits remains. The proposed record day for the dividend is 1 April 2022. The last day for trading in Swedbank's shares with the right to the dividend will be 30 March 2022. If the Annual General Meeting approves the Board's proposal, the dividend is expected to be paid out by Euroclear on 6 April 2022.

Swedbank's Annual General Meeting will be held on Wednesday, 30 March 2022. More information on the meeting will be available on the bank's website at www.swedbank.se under the heading: About us/Management and corporate governance.

The 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 55.

Group development

Result fourth quarter 2021 compared with third quarter 2021

Swedbank's profit decreased to SEK 4 835m (5 499) mainly due to higher expenses, but also due to lower income. Foreign exchange effects marginally affected profit before impairment.

The return on equity was 12.0 per cent (13.6) and the cost/income ratio was 0.50 (0.42).

Income decreased to SEK 11 749m (11 869). Above all, net gains and losses on financial items were lower, however net interest income and other income also decreased slightly. Net commission income increased and was the highest to date. Foreign exchange effects marginally affected income.

Net interest income decreased slightly in the quarter to SEK 6 554m (6 590). Underlying net interest income was negatively affected by slightly lower lending margins, but was partly offset by higher lending volumes. In mortgages, the overall impact on volume and margins was positive. In the Baltic countries, the conditions for increased corporate lending tied to the European Central Bank's liquidity loans were met, which raised net interest income by SEK 70m. Net interest income was negatively affected by SEK 60m due to a one-time effect in the leasing operations.

Net commission income increased by 6 per cent to SEK 4 020m (3 799). Income increased mainly from corporate finance as a result of a number of IPOs and share issues. Performance-based fees related to Swedbank's role as a market maker in the covered bond market had a positive effect. Asset management income rose as well thanks to performance-based income as well as a higher volume of assets under management.

Income from cards was unchanged after seasonally lower income and negative effects from the pandemic were offset by income related to discounts from MasterCard of SEK 64m.

Net gains and losses on financial items decreased to SEK 265m (553). Income mainly decreased within Large Corporates & Institutions due to a lower result in fixed income trading. The result decreased within Group Treasury mainly due to lower valuation changes in derivatives and shareholdings.

Other income decreased by 2 per cent to SEK 910m (927). Profit from the insurance operations in Swedish Banking decreased due to higher claim costs, and profit from Entercard decreased due to higher provisions for credit impairments. During the quarter, Swedbank reversed a provision for taxes attributable to Visa Sweden ekonomisk förening, which positively contributed to the result.

Expenses were seasonally high and increased by 16 per cent to SEK 5 842m (5 042). Higher staff, IT and consulting expenses, as well as higher expenses for marketing activities, mainly contributed to the increase. The higher staff costs were primarily due to a higher number of employees and lower activity in the third quarter due to the vacation period. Consulting expenses to manage money laundering related investigations amounted to SEK 92m (96). Foreign exchange effects marginally affected expenses.

Credit impairments amounted to SEK -67m (18). Updated macroeconomic scenarios led to lower credit impairment provisions, which were largely offset by additional expert credit adjustments due to lingering uncertainty about the pandemic's future impact. Individual provisions increased, but were offset by a reversal of previous expert credit adjustments in oil and offshore. Negative rating migrations and stage migrations contributed to increased credit impairment provisions. Oil-related lending continued to decrease due to divestments and restructurings, which reduced the credit impairment provisions.

Credit impairments
by business area	Q4	Q3	Q4		Full-year Full-year
SEKm	2021	2021	2020	2021	2020
Swedish Banking	68	-83	-1	-42	664
Baltic Banking	-17	-20	-8	160	237
Estonia	20	-11	-10	117	135
Latvia	-29	-11	5	25	53
Lithuania	-8	2	-3	18	49
Large Corporates & Institutions	-118	124	537	56	3 425
Group Functions & Other	0	-3	-5	-4	8
Total	-67	18	523	170	4 334

The tax expense amounted to SEK 1 139m (1 310), corresponding to an effective tax rate of 19.1 per cent (19.2).

Result full-year 2021 compared with full-year 2020

Swedbank's profit increased to SEK 20 872m (12 929) due to higher income and lower credit impairments, and since the Swedish FSA's administrative fine was paid in the first quarter of the previous year. The table below shows a simplified income statement adjusted for the Swedish FSA's administrative fine.

Income statement, SEKm	Full-year 2021	Full-year Full-year 2020
		Excl administrativ e fine
Total income	46 890	45 676	45 676
Total expenses	20 847	20 560	24 560
of which administrative fine	0	0	4 000
Credit impairment and impairment	226	4 336	4 336
Profit before tax	25 817	20 780	16 780
Tax expense	4 945	3 851	3 851
Profit for the period	20 872	16 929	12 929
Return on equity, %	13.2	11.4	8.9
Cost/Income ratio	0.44	0.45	0.54

Foreign exchange effects negatively affected profit before impairment by around SEK 177m.

The return on equity was 13.2 per cent (8.9) and the cost/income ratio was 0.44 (0.54).

Income increased to SEK 46 890m (45 676) and was positively affected primarily by higher net commission income. Other income also increased, while net interest income and net gains and losses on financial items decreased. Foreign exchange effects reduced income by SEK 316m.

Net interest income decreased by 2 per cent to SEK 26 257m (26 853). The decrease was mainly the result of lower margins and higher expenses for surplus liquidity after deposits increased faster than lending.

Net commission income increased by 16 per cent to SEK 14 853m (12 770). Income primarily increased in asset management, due to the higher average assets under management. Income from cards and corporate finance also contributed to the increase.

Net gains and losses on financial items decreased to SEK 2 048m (2 655). Income primarily decreased within Large Corporates & Institutions due to a lower result in fixed income trading.

Other income increased by 10 per cent to SEK 3 732m (3 398), mainly because associated companies were charged with provisions for credit impairments tied to the pandemic outbreak in the previous year.

Expenses decreased to SEK 20 847m (24 560) since the Swedish FSA's administrative fine of SEK 4 000m affected the first quarter of the previous year. Adjusted for the administrative fine, expenses increased by 1 per cent, mainly due to a higher number of employees and higher staff costs. Consulting expenses for money laundering-related investigations decreased to SEK 355m (852).

Credit impairments decreased to SEK 170m (4 334) since credit impairments in 2020 were strongly impacted by the Covid-19 outbreak. Additional provisions in oil and offshore in 2021 were largely offset by improved macroeconomic scenarios.

The tax expense amounted to SEK 4 945m (3 851), corresponding to an effective tax rate of 19.2 per cent (22.9). Profit in the 2020 figure included among other things the Swedish FSA's fine, which was not tax deductible. The Group's effective tax rate is estimated at 19-21 per cent in the medium term.

Volume trend by product area

Swedbank's main business is organised in three product areas: lending, payments and savings.

Lending

Total lending to the public, excluding repos and lending to the Swedish National Debt Office, increased by SEK 26bn to SEK 1 679bn (1 653) compared with the end of the third quarter 2021. Compared with the end of the fourth quarter 2020 lending increased by SEK 63bn, or by 4 per cent. Foreign exchange effects positively affected lending volumes by SEK 3bn compared with the end of the third quarter 2021 and positively by SEK 8bn compared with the end of the fourth quarter 2020.

National Debt Office and repurchase	31 Dec	30 Sep	31 Dec
agreements, SEKbn	2021	2021	2020
Loans, private mortgage	991	975	939
of which Swedish Banking	893	880	849
of which Baltic Banking	98	95	90
Loans, private other incl tenant-owner
associations	143	141	141
of which Swedish Banking	124	122	123
of which Baltic Banking	17	17	16
of which Large Corporates & Inst.	2	2	2
Loans, corporate	545	537	536
of which Swedish Banking	235	241	239
of which Baltic Banking	84	80	76
of which Large Corporates & Inst.	226	216	221
Total	1 679	1 653	1 616

Lending to mortgage customers within Swedish Banking increased by SEK 13bn to SEK 893bn compared with the end of the third quarter 2021. The market share in mortgages was 23 per cent (23). Other private lending, including lending to tenant-owner associations, increased by SEK 2bn in the quarter.

Baltic Banking's mortgage volume increased by 2 per cent in local currency to the equivalent of SEK 98bn at the end of the quarter.

Corporate lending in all business areas increased by SEK 8bn in the quarter to SEK 545bn (537). In Sweden, the market share was 16 per cent (16).

During the year, Swedbank's green asset portfolio grew partly because we included mortgages on energy class A and B properties. At year-end, lending volume in Swedbank's green asset portfolio amounted to SEK 45bn (40), or an increase of nearly 12 per cent in the quarter. Lending volume grew largely because a number of certified green multi-family housing projects under construction were approved for green financing and were thus added to the asset portfolio. The green asset portfolio consists of qualified green loans according to Swedbank's green bond framework. For more information on the green asset portfolio, see page 70 of the Fact book and Note S3 Sustainable finance in the annual and sustainability report.

For more information on lending, see page 36 of the Fact book.

Payments

The total number of Swedbank cards in issue at the end of the quarter was 8.2 million, in line with the end of the third quarter. In Sweden, 4.4 million cards were in issue and in the Baltic countries 3.8 million. Compared with the same quarter in 2020 corporate card issuance in Sweden grew by 2.0 per cent and private card issuance by 1.0 per cent.

	31 Dec	30 Sep	31 Dec
Number of cards	2021	2021	2020
Issued cards, millon	8.2	8.2	8.1
of which Sweden	4.4	4.4	4.3
of which Baltic countries	3.8	3.8	3.8

The number of purchases with Swedbank cards increased in Sweden by 13 per cent in the quarter compared with the same quarter in 2020. A total of 347 million card purchases were made and were positively affected by reduced restrictions. In the Baltic countries, the number of card purchases increased by 12 per cent in the same period to 186 million in the quarter.

The number of card transactions acquired by Swedbank increased by 11 per cent in the quarter compared with the year-earlier period. In Sweden, Norway, Finland and Denmark, 880 million card transactions were acquired, an increase of 12 per cent against the equivalent period in 2020. In the Baltic countries, the corresponding figure was 127 million transactions, up 8 per cent.

Card transactions acquired in Sweden, Norway, Finland and Denmark amounted to SEK 238bn, an increase of 13 per cent in the quarter compared with the equivalent period in 2020. Transaction volumes in the Baltic countries amounted to SEK 24bn, an increase of 15 per cent.

Reduced restrictions primarily in the first two months of the quarter positively affected transactions and transaction volumes. The important shopping period of Black Friday and Christmas also positively contributed as the share of store purchases increased from a year earlier.

In Sweden, there were 226 million domestic payments in the fourth quarter, an increase of 2 per cent against the fourth quarter of 2020. In the Baltic countries, 96 million domestic payments were processed, up 8 per cent compared with the same period in 2020. Swedbank's market share of payments through the Bankgiro system was 34 per cent. The number of international payments in Sweden increased by 6 per cent compared with the same quarter in 2020 to 1.7 million. In the Baltic countries, international payments increased by 27 per cent to 5.2 million.

Savings

Total deposits within the business areas increased to SEK 1 261bn (1 222). Compared with the end of the fourth quarter 2020 the increase was SEK 131bn, corresponding to growth of 11 per cent. All business areas contributed to the increase compared to the equivalent period of 2020. Exchange rates positively affected deposits by SEK 3bn compared with the end of the third quarter 2021 and positively by SEK 8bn compared with the end of the fourth quarter 2020. Total deposits from the public, including volumes attributable to Group Treasury, amounted to SEK 1 261bn (1 300).

Deposits from the public excl. the
Swedish National Debt Office and	31 Dec	30 Sep	31 Dec
repurchase agreements, SEKbn	2021	2021	2020
Deposits, private	656	640	588
of which Swedish Banking	460	454	424
of which Baltic Banking	196	186	164
Deposits, corporate	605	660	543
of which Swedish Banking	252	236	222
of which Baltic Banking	133	115	120
of which Large Corporates & Inst.	220	231	200
of which Group Functions & Other	0	78	1
Total	1 261	1 300	1 131

Swedbank's deposits from private customers increased by SEK 16bn in the quarter to SEK 656bn (640).

Corporate deposits in the business areas increased in total by SEK 23bn in the quarter.

Swedbank's market share for household deposits in Sweden was unchanged at 19 per cent (19). The market share for corporate deposits was also unchanged at 16 per cent (16). For more information on deposits, see page 37 of the Fact book.

Asset management, SEKbn	31 Dec 2021	30 Sep 2021	31 Dec 2020
Sweden	1 445	1 319	1 147
Estonia	21	20	24
Latvia	29	27	23
Lithuania	23	21	17
Other countries	1	11	9
Funds under Management, Swedbank
Robur	1 519	1 398	1 220
Funds under Management, Lithuania	2	1	7
Total Funds under Management	1 521	1 399	1 227
Discretionary asset management	497	485	459
Total Assets under Management	2 018	1 884	1 686

Assets under management in Swedbank Robur rose by nearly 9 per cent in the quarter to SEK 1 519bn (1 398) as of 31 December, of which SEK 1 445bn (1 319) related to Sweden, SEK 73bn (68) to the Baltic countries and the remaining SEK 1bn (11) to other markets. The increases in Sweden and the Baltic countries are partly due to positive market development and partly to net fund inflows.

The net flow in the Swedish fund market rose to SEK 82bn (25), of which SEK 42bn relates to the annual deposit from the Swedish Pensions Agency. All fund categories had net inflows, with the largest inflow, SEK 40bn, to fixed income funds, followed by SEK 16bn to mixed funds, SEK 15bn to index funds, SEK 9bn to active equity funds and SEK 2bn to hedge funds and other funds.

Including the annual deposit from the Swedish Pensions Agency of SEK 5bn, Swedbank Robur had net inflows of SEK 7bn (-3bn) in Sweden in the quarter. The improvement is mainly attributable to distribution via Swedish Banking and the savings banks, however institutional management sales improved as well.

Just over a year ago, Swedbank Robur was one of the first to sign the global Net Zero Asset Managers initiative, where Swedbank Robur and other asset managers are working together to achieve the Paris Agreement's net zero target by 2050. During the quarter and leading up to COP26, Net Zero Asset Managers presented a progress report with among other things Swedbank Robur's targets and methods to reach the Paris Agreement's targets based on a common framework. Swedbank Robur's target is that all its fund AUM align with the Paris Agreement's target to limit global warming to 1.5°C by 2025 and that all fund AUM reach net zero targets by 2040.

During the quarter, Swedbank Robur took another step towards our climate targets in that its five Transfer funds are aligned with the Paris Agreement. This means that the funds invest in companies with low carbon footprints today and plan to further reduce them in the future. The management and analysis method that Swedbank Robur has developed is based on the EU Sustainable Finance Climate Benchmark. Transfer funds are a

convenient choice for pension savers to reduce risk as they near retirement.

Net inflows in the Baltic countries amounted to SEK 2bn (-5) in the quarter. The previously large withdrawals in Estonia, which were due to a pension reform which permitted savers to make a one-time withdrawal from previously restricted savings, have now decreased. The net inflows in Latvia and Lithuania remained stable.

By assets under management Swedbank Robur is the leader in the Swedish and Baltic fund markets. As of 31 December, the market share in Sweden was 21 per cent. The market shares in Estonia, Latvia and Lithuania were 39, 41 and 38 percent respectively.

Assets under management, life insurance SEKbn	31 Dec 2021	30 Sep 2021	31 Dec 2020
Sweden	321	295	247
of which collective occupational
pensions	168	152	125
of which endowment insurance	102	96	80
of which occupational pensions	39	36	32
of which other	12	11	10
Baltic countries	8	8	7

Life insurance assets under management in the Swedish operations rose by 9 per cent in the fourth quarter to SEK 321bn on 31 December. Premium income, consisting of premium payments and capital transfers, amounted to SEK 7bn (7) in the fourth quarter.

For premium income excluding capital transfers, Swedbank's market share in the third quarter was 7 per cent (7). In the transfer market, Swedbank's market share in the third quarter was 9 per cent (9).

In Estonia, Latvia and Lithuania, Swedbank is the largest life insurance company. The market shares for premium payments in the first 11 months of the year were 45 per cent in Estonia, 24 per cent in Latvia and 25 per cent in Lithuania.

Credit and asset quality

Swedbank's credit quality remained good and was supported by the economic recovery in the quarter. Uncertainty increased, however, due to Omicron's spread and increased restrictions. Increased inflation pressures, mainly driven by high energy prices, also contributed to the uncertainty surrounding future economic development. The increased uncertainty has not yet negatively impacted Swedbank's credit quality, but the long-term effects of continued inflation pressures and the potential consequences of the pandemic in various sectors are being carefully monitored. Provisions for potential future declines in credit quality in the form of expert credit adjustments amounted to SEK 1 796m as of 31 December 2021 (1 533 as of 31 December 2020). The sectors most affected by the pandemic, such as hotels and restaurants, some parts of retail and passenger travel, account for a limited share of Swedbank's lending.

The total share of loans in stage 2, gross, decreased slightly in the quarter to 5.7 per cent (5.9), of which 3.7 per cent (3.7) was for private loans and 10.3 per cent (10.7) for corporate loans. In the fourth quarter 2020, the total share was 6.4 per cent. The decrease in stage 2 during the year mainly occurred in the shipping

and offshore sector, partly due to lower exposures to a few large counterparties.

The share of loans in stage 3, gross, decreased to 0.37 per cent (0.40) due to restructured exposures in the shipping and offshore sector. The provision ratio for loans in stage 3 was 38 per cent (44). In the fourth quarter 2020, the share of loans in stage 3, gross, was 0.62 per cent. The decrease during the year is also due to sold receivables in shipping and offshore.

The quality of Swedbank's mortgage portfolio, which accounts for just over half of total lending, is high and historical credit impairments are very low. Customers' long-term repayment capacity is a critical factor in lending, which leads to low risks for both the customer and the bank. The average loan-to-value ratios for the mortgage portfolio were 51 per cent in Sweden, 45 per cent in Estonia, 69 per cent in Latvia and 54 per cent in Lithuania.

Swedbank's lending to the property management sector accounts for approximately 15 per cent of the total loan portfolio. Stable cash flows and the customer's longterm ability to repay interest and amortisation are the key lending factors. In addition, customers should be financially strong and collateral should have sound loanto-value ratios. The average loan-to-value ratio in Sweden was 54 per cent (53) at the end of the fourth quarter.

Swedbank's oil and offshore lending is limited and decreased during the year as a result of the ongoing restructuring of the portfolio. Investments in the oil and offshore industry remain low and the market situation is challenging despite oil prices rising in 2021 and reaching the highest levels in three years last autumn. The global energy transition is contributing to increased uncertainty in the sector.

For more information on credit exposures and credit quality, see notes 9-12 and pages 39-51 of the fact book.

Operational risks

The spread of Covid-19 is still a risk for the bank, its employees and customers. The bank is carefully monitoring the new variant and in December reintroduced restrictions in accordance with the recommendations issued by the Public Health Agency of Sweden. The number of employees working remotely was stable while the number who were unable to work increased in the quarter. Discussions are underway at the Group level on future work models under the leadership of Group HR. The bank's position is to act cautiously. Consequently, measures are being taken to plan the reopening phase and recommendations are being prepared.

A serious IT incident occurred in the fourth quarter, which caused a disruption and affected the availability of the bank's services. After the incident, measures were taken to reduce the risk of new incidents. Several measures were also taken in the quarter to increase IT stability, including improvements related to external suppliers. Swedbank has several ongoing initiatives to further improve operational resilience and ensure a high level of availability for customers.

The value of accurately and securely managed and reported data is becoming increasingly clear in the financial industry. Customers' expectation of

transparency on data integrity is increasing, as are reporting requirements from authorities. These are areas where the bank is working to further strengthen quality through among other things authentication and automation.

Funding and liquidity

Funding activity in 2021 was in line with 2020, but significantly lower than earlier years due to large deposit inflows. Covered bond issuance in particular were down. The focus was instead on senior unsecured and senior non-preferred debt issuance to meet regulatory requirements. In 2021, long-term issuance amounted to SEK 138bn, including SEK 4bn in Additional Tier 1 capital instruments (AT1).

In the fourth quarter, long-term issuance amounted to SEK 60bn, of which covered bond issuance was SEK 38bn. Swedbank's commitment to finance green projects enabled additional green bond issuance in the quarter, this time in U.S. dollars. Swedbank now has outstanding green bonds in a number of major currencies, including USD, EUR and GBP, as well as in SEK.

The total issuance need for the full-year 2022 is expected to be in line with issuance volume in 2021, with a continued focus on senior unsecured and nonpreferred bonds to meet updated MREL needs. The rate of green bond issuance depends on the volume of green assets. Demand for the bank's financing is affected by the current liquidity situation, future maturities and changes in deposit and lending volumes, and is therefore adjusted over the course of the year. Maturities in 2022 amount to SEK 173bn calculated from the beginning of the year.

Increased long-term funding, continued high deposit growth, lower capital market activity by our customers, and less favourable market conditions contributed to lower short-term funding volumes in the quarter. As of 31 December, Swedbank's short-term funding and commercial paper in issue amounted to SEK 165bn (387). Available cash and balances with central banks and reserves with the Swedish National Debt Office amounted to SEK 355bn (646) and the liquidity reserve amounted to SEK 546bn (840). The Group's liquidity coverage ratio (LCR) was 163 per cent (149) and for USD, EUR and SEK was 152, 419 and 113 per cent respectively. The net stable funding ratio (NSFR) was 123 per cent (124).

For more information on funding and liquidity, see notes 14-16 and pages 55–67 of the fact book.

Ratings

There were no changes in Swedbank's ratings in the fourth quarter. For more information on the ratings, see page 67 of the fact book.

Capital and capital adequacy

Capital ratio and capital requirement

The Common Equity Tier 1 capital ratio was 18.3 per cent at the end of the quarter (18.5). The total Common Equity Tier 1 capital requirement, including Pillar 2 guidance, was 13.7 per cent (13.7) of the risk exposure amount (REA), which results in a Common Equity Tier 1 capital buffer of 4.6 per cent (4.8). Common Equity Tier 1 capital decreased to

SEK 129.6bn (129.9) and was mainly affected by the quarterly profit and proposed dividend.

Change in Common Equity Tier 1 capital¹

¹Refers to Swedbank consolidated situation

Risk Exposure Amount (REA)

Total REA increased to SEK 707.8bn (703.2) in the fourth quarter.

REA for credit risk decreased due to improved ratings, improved collateral and a lower REA for counterparty risk driven by lower derivative exposures. This was partly offset by an increase in REA for lending.

REA for market risk increased through higher REA from internal models, while a change in CVA due to lower exposures contributed to a decrease in REA.

In addition, the annual calculation of REA for operational risks led to an increase in REA.

Additional REA for article 3 of the EU's Capital Requirements Regulation (CRR) resulted in an increase of SEK 2.2bn, mainly due to a change in the probability of default in the model for large corporates.

Change in REA¹

¹Refers to Swedbank consolidated situation

The leverage ratio was 5.4 per cent (4.9) and thereby exceeds the leverage ratio requirement including Pillar 2 guidance of 3.45 per cent. The increase is largely due to lower total assets.

Capital and resolution regulations

In the fourth quarter 2018, the Swedish FSA published a memorandum explaining its view of the European Banking Authority's (EBA) updated guidelines on banks' internal risk rating based models. In the memorandum the Swedish FSA states that Swedish banks must adjust their internal rating based models to ensure that they continue to live up to the new requirements. The bank has submitted its updated internal risk classification

models to the Swedish FSA for evaluation and is awaiting a response. The implementation is expected to increase Swedbank's risk-weighted assets.

In the third quarter 2021, an amended Resolution Act took effect. The amendments are based on the EU's Bank Recovery and Resolution Directive (BRRD II), which among other things contains provisions on the minimum requirement for own funds and eligible liabilities (MREL). Due to the amended law, the Swedish National Debt Office decided how MREL would be applied as of 1 January 2022. The phase-in will be completed by 1 January 2024. For Swedbank, the application of MREL will increase the aggregate need for senior unsecured and senior non-preferred debt in relation to current funding.

In the third quarter 2021, the Swedish FSA announced that it is raising the countercyclical buffer rate to 1 per cent of REA. The requirement enters into force in the third quarter 2022. As a result of the pandemic, the countercyclical buffer in Sweden was lowered from 2.5 per cent to 0 per cent.

In the fourth quarter 2021, the EU Commission published its finalised Basel III proposal, also called Basel IV. The proposal contains actions to strengthen the comparability of risk-weighted capital ratios between banks in different countries and thereby reduce unjustified differences. The actions include revisions to the standardised approaches and internal models used to calculate the capital requirements for credit risk. A capital requirement floor was introduced for internal models where the risk-weighted assets may not fall below 72.5 per cent of the amount calculated using the standardised approach. The proposal also contains temporary exemptions beyond those previously proposed by the Basel Committee. The EU Commission's proposed changes would be gradually introduced in the period 2025 – 2030. The temporary exemptions would apply until end 2032. In the next stage the proposal will be negotiated by the European Council and the EU Parliament. The impact of the proposal is currently hard to assess.

Investigations

In Sweden, the FSA announced on 26 October that it had closed its investigation of the bank's suspected breaches of the EU's Market Abuse Regulation with no remark. The suspected breaches occurred in connection with the disclosure of suspected money laundering within the bank in the period September 2018 to February 2019.

In Estonia, the FSA submitted part of its investigation to the Estonian Prosecutor's Office in November 2019. The investigation is reviewing whether money laundering or other criminal activities have taken place in Swedbank AS. The bank has no information as to when this investigation will be completed.

The U.S. authorities are continuing to investigate Swedbank's historical AML/CTF work and historical information disclosures. The investigations are being conducted by the Department of Justice (DoJ), Securities and Exchange Commission (SEC), Office of Foreign Assets Control (OFAC) and Department of Financial Services in New York (DFS).

The investigations are progressing and the bank is holding individual discussions with relevant authorities through our 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.

Other events

On 25 October, Josefin Lindstrand announced that she was leaving Swedbank's Board of Directors to pursue board positions with other fintech and financial companies.

On 28 October, the Extraordinary General Meeting resolved, in accordance with the Board of Directors' proposal, to distribute an additional ordinary dividend of SEK 7.30 per share to the shareholders. Together with the dividends paid in February and April 2021, this dividend corresponds to 50 percent of the net profit for the financial years 2019 and 2020 and thus aligns with the bank's dividend policy.

On 15 November, Swedbank was included in the Dow Jones Sustainability Index for the second year in a row. The DJSI is a leading index for the world's most sustainable businesses.

On 25 November, the Danish Financial Supervisory Authority (DFSA), as part of its regular supervision, announced that Swedbank's Danish branch must adapt its internal anti-money laundering/counter-terrorism financing (AML/CTF) routines and processes to fully comply with local regulations. Swedbank is now adapting processes and routines in Denmark in accordance with the DFSA's decision.

On 29 November, Swedbank and the 58 collaborating savings banks extended the cooperation agreement that forms the foundation of the unique partnership. The agreement strengthens the savings banks' local presence with large-scale infrastructure and a full product range. The agreement also gives Swedbank broad product distribution.

On 12 December, it was announced that Ola Laurin was appointed the new CEO of PayEx. Ola Laurin was previously Chair of the Board of PayEx. Pål Bergström, Head of Large Corporates & Institutions at Swedbank, becomes the new Chair of the Board at PayEx.

On 14 December, the Swedish Parliament voted to introduce a bank tax for the nine largest banking groups as of 1 January 2022. The tax is based on the liabilities of Swedish credit institutions and branches and amounts to 5 basis points for 2022 and 6 basis points as of 2023. Swedbank's cost in 2022 is estimated at SEK 1bn. The tax is tax deductible and the after-tax cost is estimated at SEK 800m.

Events after 31 December 2021

On 3 January, Swedbank Robur published an updated Policy for Responsible Investments. Swedbank Robur continuously reviews its policies and strategies and updates the guidelines it follows. As of 1 January, the fund company has further tightened its Policy for Responsible Investments.

The Swedish Economic Crime Authority concluded its investigation begun in 2019 and the prosecutor's office filed charges against the former CEO on 4 January. The case does not affect Swedbank.

On 21 January, Britta Hjorth-Larsen was recruited as Chief Compliance Officer. When she starts on 1 August at the latest, she will become a member of Swedbank's Group Executive Committee.

On 28 January, Swedbank's Nomination Committee presented its proposal for the Board of Directors to the Annual General Meeting. It proposed the re-election of Göran Persson, Bo Bengtsson, Göran Bengtsson, Annika Creutzer, Hans Eckerström, Kerstin Hermansson, Bengt Erik Lindgren, Anna Mossberg, Per Olof Nyman and Biljana Pehrsson. Biörn Riese and Helena Liljedahl were proposed as new Board members. Bo Magnusson has announced that he is not available for re-election. Göran Persson is proposed as Chair of the Board of Directors.

Swedish Banking

• Improved customer offering and higher market shares in new mortgage sales
• Net interest income negatively affected by customer transfers to Large Corporates & Institutions
• Large fund inflows through own distribution channels

Income statement

	Q4	Q3		Q4		Full-year	Full-year
SEKm	2021	2021	%	2020	%	2021	2020	%
Net interest income	3 562	3 725	-4	3 851	-8	14 973	16 277	-8
Net commission income	2 419	2 381	2	2 100	15	9 205	7 922	16
Net gains and losses on financial items	144	105	37	91	58	586	351	67
Other income1	361	513	-30	422	-14	1 855	1 593	16
Total income	6 486	6 724	-4	6 464	0	26 619	26 143	2
Staff costs	828	793	4	781	6	3 222	3 050	6
Variable staff costs	13	15	-13	17	-24	61	47	30
Other expenses	2 051	1 780	15	2 000	3	7 450	6 875	8
Depreciation/amortisation	8	9	-11	12	-33	38	53	-28
Total expenses	2 900	2 597	12	2 810	3	10 771	10 025	7
Profit before impairment	3 586	4 127	-13	3 654	-2	15 848	16 118	-2
Credit impairment	68	-83		-1		-42	664
Profit before tax	3 518	4 210	-16	3 655	-4	15 890	15 454	3
Tax expense	592	777	-24	664	-11	2 892	3 008	-4
Profit for the period	2 926	3 433	-15	2 991	-2	12 998	12 446	4
Profit for the period attributable to:
Shareholders of Swedbank AB	2 926	3 432	-15	2 991	-2	12 997	12 446	4
Non-controlling interests	0	1		0		1	0
Return on allocated equity, %	18.1	21.3		17.7		20.0	18.6
Loan/deposit ratio, %	176	180		187		176	187
Credit impairment ratio, %	0.02	-0.03		0.00		0.00	0.06
Cost/income ratio	0.45	0.39		0.43		0.40	0.38
Loans, SEKbn2	1 252	1 243	1	1 211	3	1 252	1 211	3
Deposits, SEKbn2	712	691	3	646	10	712	646	10
Full-time employees	4 041	3 984	1	3 962	2	4 041	3 962	2

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) Excluding the Swedish National Debt Office and repurchase agreements.

Result

Fourth quarter 2021 compared with third quarter 2021

Swedish Banking's profit decreased to SEK 2 926m (3 432), mainly due to seasonally higher expenses.

Net interest income decreased by 4 per cent to SEK 3 562m (3 725). To better help growing customers with more complex needs, they were transferred during the quarter to the Large Corporates & Institutions business area. This negatively affected net interest income in Swedish Banking.

Household mortgage volume increased by SEK 13bn (13) to SEK 893bn and the aggregate effect on volume and margins was slightly positive. Lending to tenantowner associations increased to SEK 91bn (90). Underlying corporate lending was stable. The customer transfers to Large Corporates & Institutions negatively affected volumes by SEK 5bn, mainly in property management, and total lending thereby decreased to SEK 235bn (241).

Deposit volume increased to SEK 711bn (691), of which household deposits increased by SEK 6bn and corporate deposits by SEK 15bn.

Net commission income increased to SEK 2 419m (2 381), mainly through higher card commissions and higher income from securities trading. Card income was positively affected by discounts of SEK 64m from MasterCard, while underlying card income was seasonally lower and negatively affected by the pandemic.

Net gains and losses on financial items increased to SEK 144m (105), mainly due to a positive profit effect of the customer transfer to Large Corporates & Institutions.

Other income decreased to SEK 361m (513), mainly due to lower net insurance and lower income from Entercard.

Expenses increased to SEK 2 900m (2 597), largely due to higher costs for staff, premises and IT as well as internally purchased services.

Credit impairments amounted to SEK 68m (-83), mainly due to negative rating migrations and stage migrations.

Full-year 2021 compared with full-year 2020

Profit increased to SEK 12 997m (12 446), mainly due to higher net commission income and lower credit impairments.

Net interest income decreased to SEK 14 973m (16 277). Lower average market interest rates negatively affected net interest income, but this was partly offset by higher lending margins.

Net commission income increased to SEK 9 205m (7 922) through higher income from asset management.

Net gains and losses on financial items increased mainly due to a positive valuation effect on a shareholding in Hemnet, which went public in the second quarter 2021.

Other income, including the share from associated companies and joint ventures, increased mainly due to higher income from Entercard.

Expenses increased by 7 per cent to SEK 10 771m (10 025), mainly due to increased expenses related to compliance.

Credit impairments amounted to SEK -42m (664). In 2020, credit impairments were impacted by the outbreak of the pandemic.

Business development

The Swedish mortgage market continued to grow at a rapid pace in the quarter, especially in large urban regions. We have maintained our market-leading position in both new sales and lending volume. During the quarter, we also improved our offering and continued to improve availability for our customers. Swedbank and several other mortgage institutions raised prices on longer interest fixing periods in the quarter, which led to more customers choosing variable rather than fixed rates on their mortgages.

The economic recovery continued in the quarter and we saw more activity among Swedish companies. We were able to help new and existing customers to grow through increased lending. The pandemic is still an impediment, especially in the hotel, restaurant and retail sectors.

To make it easier for private customers to identify themselves when they bank, they can now scan their passport or national ID card directly in the BankID app instead of contacting the bank. Young private customers of Swedbank and the savings banks with a MasterCard debit card now can easily track their orders for a new or replacement card or renewal in the young customer app.

We have launched digital allocation advice for occupational pensions that offers private customers easy-to-access personalised advice on choosing funds and risk levels. We have also improved our offering for those who want to consolidate their occupational pension with us.

To make it easier for our corporate customers to choose a more sustainable car, we have clarified the information on green leasing. We also offer a more favourable rate to lease low-emission vehicles. Corporate customers now can also replace a Business debit card in the internet bank for corporate customers and no longer have to call customer centre or contact a branch.

To reduce our carbon footprint and simplify things for customers, we have worked on an initiative to digitise customer communication since 2019. As a result, private customers have been receiving digital notifications in the internet bank or service portal for some time. More corporate documents were digitised in the quarter as well. Since 2019, we have reduced the amount of mail sent to customers of Swedbank and the savings banks by 15 million letters, which has reduced our carbon footprint by 1 000 tonnes CO2e.

We are continuously reviewing which countries and currencies to include in our foreign payment offering based on changes in our markets. During the quarter, we therefore reduced the number of countries that foreign payments can be issued to.

Swedbank was named "Public Educator of the Year" in Sweden by the business magazine Privata Affärer. We have had over 90 000 students participate in the Young Economy course as well as 4 400 seniors in the Digital Economy course.

During the quarter, Swedish Banking implemented a new organisation. The purpose of the change is to increase availability and better meet our customers' needs through faster and simpler advice.

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 Sweden's largest bank by number of customers. Through digital channels, customer centres and our branches, and through the cooperation with the savings banks and franchisees, we are always available. Swedbank is part of the local community. Branch managers have a strong mandate to act in their local communities. The bank's presence and engagement are expressed in various ways. A project called "Young Jobs", which has created thousands of trainee positions for young people, has played an important part in recent years. Swedbank has 153 branches in Sweden.

Baltic Banking

• Increased lending to companies and consumers
• Positive effect from the European Central Bank's liquidity loans
• Improved savings offering with new funds launched

Income statement

	Q4	Q3		Q4		Full-year	Full-year
SEKm	2021	2021	%	2020	%	2021	2020	%
Net interest income	1 379	1 296	6	1 266	9	5 296	5 354	-1
Net commission income	675	682	-1	606	11	2 603	2 430	7
Net gains and losses on financial items	118	88	34	100	18	390	337	16
Other income1	192	160	20	242	-21	763	912	-16
Total income	2 364	2 226	6	2 214	7	9 052	9 033	0
Staff costs	377	365	3	364	4	1 424	1 381	3
Variable staff costs	14	13	8	21	-33	57	50	14
Other expenses	688	599	15	602	14	2 326	2 018	15
Depreciation/amortisation	42	43	-2	42	0	170	175	-3
Total expenses	1 121	1 020	10	1 029	9	3 977	3 624	10
Profit before impairment	1 243	1 206	3	1 185	5	5 075	5 409	-6
Impairment of tangible assets	0	0		1		0	2
Credit impairment	-17	-20	-15	-8		160	237	-32
Profit before tax	1 260	1 226	3	1 192	6	4 915	5 170	-5
Tax expense	209	207	1	197	6	822	864	-5
Profit for the period	1 051	1 019	3	995	6	4 093	4 306	-5
Profit for the period attributable to:
Shareholders of Swedbank AB	1 051	1 019	3	995	6	4 093	4 306	-5
Return on allocated equity, %	17.0	16.6		16.1		16.6	17.4
Loan/deposit ratio, %	61	64		64		61	64
Credit impairment ratio, %	-0.03	-0.04		-0.02		0.09	0.12
Cost/income ratio	0.47	0.46		0.46		0.44	0.40
Loans, SEKbn2	199	192	4	182	9	199	182	9
Deposits, SEKbn2
	329	301	9	284	16	329	284	16
Full-time employees	4 257	4 251	0	4 265	0	4 257	4 265	0

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) Excluding the Swedish National Debt Office and repurchase agreements.

Result

Fourth quarter 2021 compared with third quarter 2021

Profit in the fourth quarter increased to SEK 1 051m (1 019). Profit increased in local currency thanks to higher income at the same time that expenses rose in the quarter. Foreign exchange effects reduced profit by SEK 3m.

Net interest income increased by 7 per cent in local currency mainly due to the positive effect when Swedbank in the quarter qualified for the European Central Bank's targeted longer-term refinancing operations (TLTRO3) and higher lending volumes. Mortgage margins were unchanged in the quarter, at the same time the margins on corporate lending fell slightly. Foreign exchange effects reduced net interest income by SEK 4m.

Lending increased by 3 per cent in the quarter in local currency. Household lending increased by 2 per cent while corporate lending increased by 5 per cent. Foreign exchange effects positively contributed SEK 1bn.

In local currency, deposit volume increased by 9 per cent in the quarter. Private and corporate deposits both increased. Foreign exchange effects positively contributed SEK 2bn.

Net commission income decreased by 1 per cent in local currency in the quarter, with both card income and asset management income declining.

Net gains and losses on financial items increased by 33 per cent in local currency driven by increased income from FX transactions.

Other income increased by 20 per cent in local currency due to lower insurance claims in the quarter.

Expenses increased by 10 per cent in local currency, largely due to seasonally higher marketing expenses, staff costs and expenses for premises. Work to strengthen AML functions and improve KYC processes continued in the quarter.

Credit impairments amounted to SEK -17m (-20).

Full-year 2021 compared with full-year 2020

Profit amounted to SEK 4 093m (4 306) in the period. Profit decreased in local currency mainly due to higher expenses, which was offset by increased income and lower credit impairments. Foreign exchange effects negatively affected profit by SEK 138m.

Net interest income increased by 2 per cent in local currency. Higher lending volumes and a positive effect when Swedbank qualified for the European Central

Bank's targeted longer-term refinancing operations (TLTRO3) were partly offset by lower deposit margins. Foreign exchange effects negatively affected net interest income by SEK 184m.

Lending increased by 8 per cent in local currency. Household lending increased by 7 per cent while corporate lending increased by 8 per cent. Foreign exchange effects increased lending growth by SEK 3bn.

Deposits increased by 14 per cent in local currency. Deposits increased in all markets. Foreign exchange effects positively contributed SEK 6bn.

Net commission income increased by 11 per cent in local currency, mainly due to higher income from the card and payment operations, asset management and other fees.

Net gains and losses on financial items increased by 19 per cent in local currency, largely due to high unrealised losses in asset management and the insurance businesses in 2020 as well as increased income from FX transactions.

Other income decreased by 14 per cent in local currency due to a lower result in the insurance business.

Expenses increased by 13 per cent in local currency, mainly due to higher staff costs and expenses related to AML work, increased expenses for risk management and compliance, and higher expense allocations for Group Functions. Expenses for and investments in digital solutions increased as well. This was partly offset by cost savings in the branch network.

Credit impairments amounted to SEK 160m (237), mainly due to expert credit adjustments for Covidaffected sectors at the beginning of the year.

Business development

Pandemic-related restrictions were reintroduced in the quarter due to an increased number of Covid cases. Although the big increase placed a major strain on the healthcare system, we noted very little impact on our customers. Demand remained high among both private and corporate customers. At the same time, new variants such as Omicron have increased uncertainty about future economic development.

To increase the use of our digital services and reduce the need for face-to-face meetings for private customers, digital mortgage signing was introduced in Latvia. This is a milestone for Baltic Banking as the

mortgage process is now fully digital in all three countries.

During the quarter, we improved the savings offering by launching the Corporate Bond Nordic EUR fund in all three Baltic markets. The fund is primarily designed for our corporate customers. Swedbank also launched two new equity index funds for Estonian and Latvian pension savers: one for publicly financed pension systems and one for private, voluntary pension systems. Both funds are managed according to Swedbank's sustainable investment strategy.

After the successful launch of Garmin Pay and Fitbit Pay, the range of digital wallets was expanded with Xiaomi Pay. Customers can now make contactless payments with the Xiaomi smartwatch as well. The launch has received a positive response in social media.

Swedbank has begun using recycled plastic in the manufacture of its debit cards. A full transition to recycled plastic is expected in early 2022 and is part of Swedbank's sustainability work.

Swedbank was the main organizer of the retail offering of Enefit Green's initial public offering. The IPO was oversubscribed four times and attracted more than 60 000 investors. This is the highest number ever for an IPO in the Baltic stock markets. Enefit Green is one of the leading producers of renewable energy in the region and the largest wind energy producer in the Baltic countries.

To promote the financial health of our customers, Swedbank launched a series of educational videos on investing, portfolio design and investment psychology in Russian in Estonia. In Latvia, Swedbank arranged a competition for schoolchildren on smart and creative ideas how money can be used. In Lithuania, Swedbank acted as principal partner in Food Bank's charitable initiative SHARE, to increase awareness of people in need, of poverty and of the effects of food waste on the climate.

Jon Lidefelt Head of Baltic Banking

Swedbank is the largest bank by number of customers in Estonia, Latvia and Lithuania, with around 3.3 million private customers and nearly 300 000 corporate customers. According to surveys, Swedbank is also the most popular brand in the Baltic countries. Through digital channels, customer centres and branches, the bank is always available. Swedbank is part of the local community. Its local social 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 42 in Lithuania.

Large Corporates & Institutions

• Net interest income positively affected by customer transfers from Swedish Banking
• Strong net commission income thanks to higher advisory commissions in the corporate finance business
• Improved customer satisfaction

Income statement

	Q4	Q3		Q4		Full-year	Full-year
SEKm	2021	2021	%	2020	%	2021	2020	%
Net interest income	997	922	8	942	6	3 732	3 834	-3
Net commission income	953	766	24	649	47	3 220	2 436	32
Net gains and losses on financial items	81	300	-73	677	-88	1 014	1 897	-47
Other income1	40	39	3	25	60	133	116	15
Total income	2 071	2 027	2	2 293	-10	8 099	8 283	-2
Staff costs	663	575	15	652	2	2 489	2 327	7
Variable staff costs	34	28	21	54	-37	160	94	70
Other expenses	417	342	22	342	22	1 424	1 434	-1
Depreciation/amortisation	62	61	2	65	-5	261	248	5
Total expenses	1 176	1 006	17	1 113	6	4 334	4 103	6
Profit before impairment	895	1 021	-12	1 180	-24	3 765	4 180	-10
Impairment of intangible assets	0	0		0		13	0
Credit impairment	-118	124		537		56	3 425	-98
Profit before tax	1 013	897	13	643	58	3 696	755
Tax expense	179	173	3	147	22	709	-271
Profit for the period	834	724	15	496	68	2 987	1 026
Profit for the period attributable to:
Shareholders of Swedbank AB	834	724	15	496	68	2 987	1 026
Return on allocated equity, %	10.9	9.2		6.0		9.3	3.2
Loan/deposit ratio, %	104	95		111		104	111
Credit impairment ratio, %	-0.16	0.18		0.68		0.02	1.16
Cost/income ratio	0.57	0.50		0.49		0.54	0.50
Loans, SEKbn2	228	218	5	223	2	228	223	2
Deposits, SEKbn2
	220	231	-5	200	10	220	200	10
Full-time employees	2 460	2 458	0	2 374	4	2 460	2 374	4

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) Excluding the Swedish National Debt Office and repurchase agreements.

Result

Fourth quarter 2021 compared with third quarter 2021

Profit increased to SEK 834m (725), mainly due to reversals of credit impairments.

Net interest income increased by 8 per cent to SEK 997m (922), mainly due to higher volumes in property management following the customer transfer from Swedish Banking. Higher deposit income due to higher average deposit volumes positively affected net interest income in the quarter.

Net commission income increased by 24 per cent to SEK 953m (766). Higher advisory commissions related to IPOs and equity issues, as well as fees related to Swedbank's role as liquidity guarantor in the covered bond market, had a positive effect. Income from asset management also increased thanks to performancebased income.

Net gains and losses on financial items decreased to SEK 81m (300), mainly due to decreased income from fixed income trading.

Total expenses increased to SEK 1 176m (1 066), mainly due to seasonally higher costs for staff, IT and consultants.

Credit impairments amounted to SEK -118m (124), mainly due to lower credit impairment provisions within oil and offshore as a result of divestments and restructurings.

Full-year 2021 compared with full-year 2020

Profit increased to SEK 2 987m (1 026), mainly due to lower credit impairments.

Net interest income decreased by 3 per cent to SEK 3 732m (3 834) due to lower deposit margins.

Net commission income increased by 32 per cent to SEK 3 220m (2 436). Income from asset management and lending commissions was higher during the year. Increased income from advisory commissions related to equity issues and increased income from bond issues contributed positively as well. Income from card commissions increased due to higher transaction volumes.

Net gains and losses on financial items decreased to SEK 1 014m (1 897). Decreased income from fixed

income trading was offset by derivative valuation adjustments (CVA/DVA).

Expenses increased by 6 per cent to SEK 4 334m (4 103) partly due to a higher number of employees and annual salary increases.

Credit impairments amounted to SEK 56m (3 425), mainly driven by individual provisions for a few counterparties in oil and offshore.

Business development

During the quarter, a number of customers were transferred to Large Corporates & Institutions from Swedish Banking. These customers are in a growth stage where their need for help and support is increasing in scope and complexity. It is gratifying to have the opportunity to assist them in their development.

Demand for transaction-driven financing has remained high. Swedbank participated in the financing of Heimstaden's acquisition of parts of Akelius' property portfolio and in financing in connection with Synsam's IPO. Demand for sustainable finance has also been high and Swedbank coordinated and participated in a sustainable loan to Dustin. During the quarter, we continued to reduce oil-related lending in line with the bank's strategy. The decrease amounted to approximately SEK 2bn, part of which had previously been reserved largely through the divestment of a few loans and a restructuring.

Despite increased volatility, customer activity remained good in the bond and equity markets in the quarter. Among other things, Swedbank assisted Nordic Investment Bank with green bond issues in connection

with its 10-year anniversary as a green bond issuer. Nordic Investment Bank finances water-related projects in the Nordic countries, such as the construction of the Slussen transportation hub in Stockholm. The bank also assisted Greenfood in its sustainability-linked bond issue. Swedbank was an advisor to several property companies such as Heimstaden, Wästbygg Gruppen, Fabege and Atrium Ljungberg in connection with bond issues in the quarter. For the full-year 2021 Swedbank had the largest market share as an advisor in SEK bond issues, both in total and for sustainable bonds.

Swedbank also participated in a number of equityrelated funding issues in the quarter. Together with our partner, Kepler Cheuvreux, Swedbank participated in a total of seven IPOs, the largest number ever for Swedbank in a single quarter. For example, we were an advisor on IPOs for Volvo Cars and Enefit Green. Enefit Green is an Estonian renewable energy company.

In Prospera's customer satisfaction survey for the large corporate segment in Sweden, Swedbank improved its ranking. For the very largest customers with sales of over SEK 15bn, Swedbank climbed to second place. In Prospera's survey for Corporate Banking Real Estate 2021 Sweden, Swedbank again rated as one of the leading banks. Swedbank also ranked there as a leader in bond issuance in the real estate sector.

Pål Bergström Head of Large Corporates & Institutions

Large Corporates & Institutions is responsible for Swedbank's offering to customers with revenues above SEK 2 billion and those whose needs are considered complex due to multinational operations or a need for advanced financing solutions. They are also responsible for developing corporate and capital market products for other parts of the bank and the Swedish savings banks. Large Corporates & Institutions works closely with customers, who receive advice on decisions that create long-term profitability and sustainable growth. Large Corporates & Institutions is represented in Sweden, Estonia, Latvia, Lithuania, Norway, Finland, Denmark, China, the US. and South Africa.

Group Functions & Other

Income statement

	Q4	Q3		Q4		Full-year	Full-year
SEKm	2021	2021	%	2020	%	2021	2020	%
Net interest income	620	651	-5	517	20	2 272	1 416	60
Net commission income	-25	-32	-22	-44	-43	-176	-137	28
Net gains and losses on financial items	-77	59		43		58	71	-18
Other income1	544	340	60	321	69	1 432	1 050	36
Total income	1 062	1 018	4	837	27	3 586	2 400	49
Staff costs	1 391	1 294	7	1 238	12	5 196	4 767	9
Variable staff costs	44	48	-8	82	-46	144	171	-16
Other expenses	-855	-1 086	-21	-930	-8	-4 271	-3 051	40
Depreciation/amortisation	299	289	3	288	4	1 162	1 104	5
Administrative fine	0	0		0		0	4 000
Total expenses	879	545	61	678	30	2 231	6 991	-68
Profit before impairment	183	473	-61	159	15	1 355	-4 591
Impairment of intangible assets	0	0		0		43	0
Credit impairment	0	-3		-5		-4	8
Profit before tax	183	476	-62	164	12	1 316	-4 599
Tax expense	159	153	4	136	17	522	250
Profit for the period	24	323	-93	28	-14	794	-4 849
Profit for the period attributable to:
Shareholders of Swedbank AB	24	323	-93	28	-14	794	-4 849
Full-time employees	5 807	5 745	1	5 612	3	5 807	5 612	3

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.

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 Financial Products & Advice and Group Staffs and are allocated to a large extent.

Result

Fourth quarter 2021 compared with third quarter 2021

Profit decreased to SEK 24m (323) due to higher expenses.

Net interest income decreased to SEK 620m (651). Net interest income within Group Treasury decreased to SEK 656m (690), partly due to less favourable terms in the short-term funding market.

Net gains and losses on financial items decreased to SEK -77m (59). Net gains and losses on financial items within Group Treasury decreased to SEK -73m (56), mainly due to valuation changes in derivatives and shareholdings.

Expenses increased to SEK 879m (545), mainly due to higher staff, IT and consulting expenses.

Full-year 2021 compared with full-year 2020 Profit increased to SEK 794m (-4 849), largely due to the Swedish FSA's administrative fine in the first quarter 2020.

Net interest income increased to SEK 2 272m (1 416). Group Treasury's net interest income increased to SEK 2 427m (1 573), mainly because short-term funding costs decreased and short-term market interest rates were lower during the year.

Net gains and losses on financial items decreased to SEK 58m (71). Net gains and losses on financial items within Group Treasury increased to SEK 59m (3), mainly due to lower bond repurchase volumes during the year.

Expenses decreased to SEK 2 231m (6 991), mainly due to the Swedish FSA's administrative fine and high money laundering related consulting costs in 2020, as well as higher cost allocations to the business areas in 2021.

Group Functions & Other consists of central business support units and the customer advisory unit Group Financial Products & Advice. The central units serve as strategic and administrative support and comprise Accounting & Finance, Communication and Sustainability, Risk, Digital banking & IT, Compliance, Public Affairs, HR and Legal. Group Treasury is responsible for the bank's funding, liquidity and capital planning. Group Treasury sets the prices on 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.

Eliminations

Income statement

SEKm	Q4 2021	Q3 2021	%	Q4 2020	%	Full-year 2021	Full-year 2020	%
Net interest income	-4	-4	0	-9	-56	-16	-28	-43
Net commission income	-2	2		65		1	119	-99
Net gains and losses on financial items	-1	1		-1	0	0	-1
Other income1	-227	-125	82	-99		-451	-273	65
Total income	-234	-126	86	-44		-466	-183
Staff costs	-3	-4	-25	-4	-25	-14	-14	0
Other expenses	-231	-122	89	-40		-452	-169
Total expenses	-234	-126	86	-44		-466	-183

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.

Group eliminations mainly consist of eliminations of internal transactions between Group Functions and the other business areas.

Group

	Page
Income statement, condensed	21
Statement of comprehensive income, condensed	22
Balance sheet, condensed	23
Statement of changes in equity, condensed	24
Cash flow statement, condensed	25
Notes
Note 1 Accounting policies	26
Note 2 Critical accounting estimates	26
Note 3 Changes in the Group structure	26
Note 4 Operating segments (business areas)	27
Note 5 Net interest income	29
Note 6 Net commission income	30
Note 7 Net gains and losses on financial items	31
Note 8 Other general administrative expenses	31
Note 9 Credit impairments	32
Note 10 Loans	35
Note 11 Credit impairment provisions	37
Note 12 Credit risk exposures	38
Note 13 Intangible assets	39
Note 14 Amounts owed to credit institutions	39
Note 15 Deposits and borrowings from the public	39
Note 16 Debt securities in issue, senior non-preferred liabilities and subordinated
liabilities	40
Note 17 Derivatives	40
Note 18 Fair value of financial instruments	41
Note 19 Assets pledged, contingent liabilities and commitments	43
Note 20 Offsetting financial assets and liabilities	44
Note 21 Capital adequacy, consolidated situation	45
Note 22 Internal capital requirement	47
Note 23 Risks and uncertainties	47
Note 24 Related-party transactions	48
Note 25 Swedbank's share	49

Parent company Income statement, condensed 50 Statement of comprehensive income, condensed 50 Balance sheet, condensed 51 Statement of changes in equity, condensed 52 Cash flow statement, condensed 52 Capital adequacy 53

More detailed information including definitions can be found in Swedbank's Fact book, www.swedbank.com/ir, under Financial information and publications.

Income statement, condensed

Group	Q4	Q3	Q4	Full-year	Full-year
SEKm	2021	2021	2020	2021	2020
Interest income on financial assets at amortised cost	7 593	7 483	7 300	29 912	32 020
Other interest income	235	-38	804	452	1 771
Interest income	7 828	7 445	8 104	30 364	33 791
Interest expense	-1 274	-855	-1 537	-4 107	-6 938
Net interest income (note 5)	6 554	6 590	6 567	26 257	26 853
Commission income	6 021	5 743	5 185	22 407	19 476
Commission expense	-2 001	-1 944	-1 809	-7 554	-6 706
Net commission income (note 6)	4 020	3 799	3 376	14 853	12 770
Net gains and losses on financial items (note 7)	265	553	910	2 048	2 655
Net insurance	326	361	408	1 457	1 518
Share of profit or loss of associates and joint ventures	253	239	122	976	582
Other income	331	327	381	1 299	1 298
Total income	11 749	11 869	11 764	46 890	45 676
Staff costs	3 361	3 127	3 205	12 739	11 873
Other general administrative expenses (note 8)	2 070	1 513	1 974	6 477	7 107
Depreciation/amortisation of tangible and intangible assets	411	402	407	1 631	1 580
Administrative fine	0	0	0	0	4 000
Total expenses	5 842	5 042	5 586	20 847	24 560
Profit before impairment	5 907	6 827	6 178	26 043	21 116
Impairment of intangible assets	0	0	0	56	0
Impairment of tangible assets	0	0	1	0	2
Credit impairment (note 9)	-67	18	523	170	4 334
Profit before tax	5 974	6 809	5 654	25 817	16 780
Tax expense	1 139	1 310	1 144	4 945	3 851
Profit for the period	4 835	5 499	4 510	20 872	12 929
Profit for the period attributable to:
Shareholders of Swedbank AB	4 835	5 498	4 510	20 871	12 929
Non-controlling interests	0	1	0	1	0
Earnings per share, SEK	4.31	4.90	4.03	18.62	11.55
Earnings per share after dilution, SEK	4.30	4.89	4.01	18.56	11.51

Statement of comprehensive income, condensed

Group SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Profit for the period reported via income statement	4 835	5 499	4 510	20 872	12 929
Items that will not be reclassified to the income statement
Remeasurements of defined benefit pension plans Share related to associates and joint ventures:	273	-467	1 148	1 686	5 166
Remeasurements of defined benefit pension plans	14	-35	20	21	96
Change in fair value attributable to changes in own credit risk on financial liabilities designated at fair value through profit and loss	0	0	2	0	6
Income tax	-56	96	-236	-347	-1 065
Total	231	-406	934	1 360	4 203
Items that may be reclassified to the income statement
Exchange rate differences, foreign operations:
Gains/losses arising during the period	334	251	-2 337	848	-1 838
Reclassification adjustments to income statement, Net gains and losses on financial items Hedging of net investments in foreign operations:	0	0	-2	0	-2
Gains/losses arising during the period	-286	-204	1 808	-729	1 523
Reclassification adjustments to income statement, Net gains and losses on financial items	0	0	9	0	9
Cash flow hedges:
Gains/losses arising during the period	55	42	-412	145	-358
Reclassification adjustments to the income statement, Net gains and losses on financial items	-55	-41	403	-143	349
Foreign currency basis risk:
Gains/losses arising during the period	-1	11	-24	5	-42
Share of other comprehensive income of associates and joint ventures	9	13	6	91	-84
Income tax	59	39	-372	148	-306
Total	115	111	-921	365	-749
Other comprehensive income for the period, net of tax	346	-295	13	1 725	3 454
Total comprehensive income for the period	5 181	5 204	4 523	22 597	16 383
Total comprehensive income attributable to: Shareholders of Swedbank AB
	5 181	5 203	4 523	22 596	16 383
Non-controlling interests	0	1	0	1	0

For 2021 a gain of SEK 1 686m (5 166) was recognised in other comprehensive income, relating to remeasurements of defined benefit pension plans. As per 31 December 2021the discount rate used to calculate the closing pension obligation was 2.10 per cent, compared with 1.41 per cent at 31 December 2020. The inflation assumption was 2.30 per cent compared with 1.48 per cent at 31 December 2020. The changed assumptions together with gains and losses based on experience represented SEK 461m of the positive result in other comprehensive income. The fair value of plan assets increased during 2021 by SEK 1 225m. In total, the obligation for defined benefit pension plans exceeded the fair value of plan assets by SEK 1 801m compared with SEK 3 665m at year end 2020.

For 2021 an exchange rate difference of SEK 848m (- 1 840) 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 91m (-84) 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 939m is not taxable. The large part of the Group's foreign net investments is hedged against currency risk resulting in a loss of SEK 729m (profit 1 532) for the hedging instruments.

The remeasurements of defined benefit pension plans and translation of net investments in foreign operations can be volatile in certain periods due to movements in the discount rate, inflation and exchange rates.

Balance sheet, condensed

Group SEKm	31 Dec 2021	31 Dec 2020
Assets
Cash and balances with central banks	360 153	293 811
Treasury bills and other bills eligible for refinancing with central banks, etc.	163 590	137 191
Loans to credit institutions (note 10)	39 504	47 954
Loans to the public (note 10)	1 703 206	1 680 987
Value change of interest hedged items in portfolio hedges of interest rate risk	-1 753	1 774
Bonds and other interest-bearing securities	58 093	59 975
Financial assets for which customers bear the investment risk	328 512	252 411
Shares and participating interests	13 416	17 215
	7 705	7 287
Investments in associates and joint ventures	40 531	52 177
Derivatives (note 17)
Intangible assets (note 13)	19 488 5 523	18 361 5 421
Tangible assets Current tax assets	1 372	1 554
Deferred tax assets	113	124
Other assets	9 194	16 483
	1 970	1 917
Prepaid expenses and accrued income Total assets	2 750 617	2 594 642
Liabilities and equity	92 812	150 313
Amounts owed to credit institutions (note 14) Deposits and borrowings from the public (note 15)	1 265 783	1 148 240
Financial liabilities for which customers bear the investment risk	329 667	253 229
Debt securities in issue (note 16)	735 917	732 814
Short positions, securities	28 613	23 300
Derivatives (note 17)	28 106	54 380
Current tax liabilities	672	424
Deferred tax liabilities	3 398	2 784
Pension provisions	1 801	3 665
Insurance provisions	1 970	1 859
Other liabilities and provisions	28 933	30 610
Accrued expenses and prepaid income	4 813	4 038
Senior non-preferred liabilities (note 16)	37 832	10 359
Subordinated liabilities (note 16)	28 604	23 434
Total liabilities	2 588 921	2 439 449
Equity
Non-controlling interests	26	25
Equity attributable to shareholders of the parent company	161 670	155 168
Total equity	161 696	155 193
Total liabilities and equity	2 750 617	2 594 642

Statement of changes in equity, condensed

Group SEKm				Equity attributable to shareholders of Swedbank AB
	Share capital	Other contri buted equity1	Exchange differences, subsidiaries and associates	Hedging of net investments in foreign operations	Cash flow hedge reserves	Foreign currency basis reserves	Own credit risk reserves	Retained earnings	Total	Non controlling interests	Total equity
January-December 2021 Opening balance 1 January 2021	24 904	17 275	4 355	-2 669	1	-62	0	111 364	155 168	25	155 193
Dividends	0	0	0	0	0	0	0	-16 310	-16 310	0	-16 310
Share based payments to employees	0	0	0	0	0	0	0	195	195	0	195
Deferred tax related to share based payments to employees	0	0	0	0	0	0	0	20	20	0	20
Current tax related to share based payments to employees	0	0	0	0	0	0	0	1	1	0	1
Total comprehensive income for the period	0	0	939	-579	1	4	0	22 231	22 596	1	22 597
of which reported through profit or loss of which reported through other comprehensive	0	0	0	0	0	0	0	20 871	20 871	1	20 872
income	0	0	939	-579	1	4	0	1 360	1 725	0	1 725
Closing balance 31 December 2021	24 904	17 275	5 294	-3 248	2	-58	0	117 501	161 670	26	161 696
January-December 2020
Opening balance 1 January 2020	24 904	17 275	6 279	-3 880	8	-33	-5	94 060	138 608	25	138 633
Share based payments to employees	0	0	0	0	0	0	0	178	178	0	178
Deferred tax related to share based payments to employees	0	0	0	0	0	0	0	7	7	0	7
Current tax related to share based payments to employees	0	0	0	0	0	0	0	-8	-8	0	-8
Total comprehensive income for the period	0	0	-1 924	1 211	-7	-29	5	17 127	16 383	0	16 383
of which reported through profit or loss of which reported through other comprehensive	0	0	0	0	0	0	0	12 929	12 929	0	12 929
income	0	0	-1 924	1 211	-7	-29	5	4 198	3 454	0	3 454
Closing balance 31 December 2020	24 904	17 275	4 355	-2 669	1	-62	0	111 364	155 168	25	155 193

1) Other contributed equity consists mainly of share premiums.

Cash flow statement, condensed

Group	Full-year	Full-year
SEKm	2021	2020
Operating activities
Profit before tax	25 817	16 780
Adjustments for non-cash items in operating activities	-2 863	447
Income taxes paid	-4 478	-4 331
Increase (-) / decrease (+) in loans to credit institution	8 733	-2 708
Increase (-) / decrease (+) in loans to the public	-18 746	-39 022
Increase (-) / decrease (+) in holdings of securities for trading	-20 742	-15 081
Increase (-) / decrease (+) in other assets	19 618	-17 957
Increase (+) / decrease (-) in amounts owed to credit institutions	-58 471	82 381
Increase (+) / decrease (-) in deposits and borrowings from the public	112 568	203 526
Increase (+) / decrease (-) in debt securities in issue	-6 447	-104 629
Increase (+) / decrease (-) in other liabilities	-5 580	-10 169
Cash flow from operating activities	49 409	109 237
Investing activities
Acquisitions of and contributions to associates and joint ventures	-51	-54
Disposal of shares in associates		76
Dividend from associates and joint ventures	587	2
Acquisitions of other fixed assets and strategic financial assets	-253	-364
Disposals of/maturity of other fixed assets and strategic financial assets	345	1 723
Cash flow from investing activities	628	1 383
Financing activities
Amortisation of lease liabilities	-751	-723
Issuance of senior non-preferred liablities	27 501
Redemption of senior non-preferred liablities		-95
Issuance of subordinated liabilities	4 328
Redemption of subordinated liabilities	-617	-7 880
Dividends paid	-16 310
Cash flow from financing activities	14 151	-8 698
	64 188	101 922
Cash flow for the period
Cash and cash equivalents at the beginning of the period	293 811	195 286
Cash flow for the period	64 188	101 922
Exchange rate differences on cash and cash equivalents	2 154	-3 397
Cash and cash equivalents at end of the period	360 153	293 811

2021

During the year contributions were provided to joint ventures P27 Nordic Payments Platform AB of SEK 25m and Invidem AB of SEK 25m. During the third quarter additional shares were acquired in associate BGC Holding AB of SEK 1m.

During third and fourth quarter, shares in Hemnet Group AB were sold and Swedbank received a cash payment of SEK 110m which are reported in Disposals of/maturity of other fixed assets and strategic financial assets in the cash flow statement.

2020

During the year contributions were provided to joint ventures Invidem AB of SEK 23m and P27 Nordic Payments Platform AB of SEK 31m.

During the fourth quarter, the Visa Inc. A shares were sold and Swedbank received a cash payment of SEK

794m which are reported in Disposals of/maturity of other fixed assets and strategic financial assets in the cash flow statement.

During the third quarter, the shares in the Finnish credit information company Enento Group was sold. Swedbank received a cash payment of SEK 570m which are reported in Disposals of/maturity of other fixed assets and strategic financial assets in the cash flow statement.

During the second quarter the associated company Svensk Mäklarstatistik AB was sold. Swedbank received a cash payment of SEK 5m and the capital gain was SEK 3m.

During the first quarter, Swedbank received a cash payment of SEK 71m as a final payment for the sale of the associated company Hemnet AB in 2017.

Note 1 Accounting policies

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 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 2020, which was prepared in accordance with International Financial Reporting Standards as adopted by the European Union and interpretations thereof. There have been no significant changes to the Group's accounting policies, except for the change as set out below.

Amendments for Interest Rate Benchmark Reform (phase 2)

Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 due to the Interest Rate Benchmark Reform – Phase 2 are applied from 1 January 2021.

Note 2 Critical accounting estimates

Presentation of consolidated financial statements in conformity with IFRS requires the executive management to make judgments and estimates that affect the recognised amounts for assets, liabilities and disclosures of contingent assets and liabilities as of the reporting date as well as the recognised income and expenses during the report 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

Note 3 Changes in the Group structure

On 1 October 2021, has implemented achange to Baltic activities governance and control. The wholly owned Latvian holding company Swedbank Baltics AS became owner of the subsidiaries Swedbank AS (Estonia),

The amendments address the accounting issues that arise when financial instruments that reference an IBOR interest rate transition to an alternative benchmark rate. The amendments include a practical expedient for modifications required by the Interest Rate Benchmark Reform (the Reform), to be treated as changes to a floating interest rate. They also permit changes required by the Reform to be implemented in hedge designations and hedge documentation without the hedging relationship being discontinued. The adoption did not have any impact on the Group's financial position, results, cash flows or disclosures.

Other changes in accounting regulations

Other amended regulations that have been adopted from 1 January 2021 did not have a significant impact on the Group's financial position, results, cash flows or disclosures.

Standards issued but not yet adopted

IFRS 17 Insurance Contracts was approved by the EU in November 2021 and is applicable from 1 January 2023. The EU approval included an annual cohort exemption which is not expected to have a significant impact on Swedbank.

goodwill, deferred taxes and defined benefit pension provisions.

Due to the continued uncertainties related to Covid-19 post-model expert credit adjustments to the credit impairment provisions continue to be necessary. Details of these are found in Note 9. 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 2020.

Swedbank AS (Latvia) and Swedbank AB (Lithuania), which previously was owned by Swedbank AB. In doing this Swedbank AB formalises the current operating model and clarifies the accountability and responsibility of the Baltic management.

Note 4 Operating segments (business areas)

Full-year 2021			Large	Group
	Swedish	Baltic	Corporates &	Functions
SEKm	Banking	Banking	Institutions	& Other	Eliminations	Group
Income statement
Net interest income	14 973	5 296	3 732	2 272	-16	26 257
Net commission income	9 205	2 603	3 220	-176	1	14 853
Net gains and losses on financial items	586	390	1 014	58	0	2 048
Other income1	1 855	763	133	1 432	-451	3 732
Total income	26 619	9 052	8 099	3 586	-466	46 890
Staff costs	3 222	1 424	2 489	5 196	-14	12 317
Variable staff costs	61	57	160	144	0	422
Other expenses	7 450	2 326	1 424	-4 271	-452	6 477
Depreciation/amortisation	38	170	261	1 162	0	1 631
Total expenses	10 771	3 977	4 334	2 231	-466	20 847
Profit before impairment	15 848	5 075	3 765	1 355	0	26 043
Impairment of intangible assets	0	0	13	43	0	56
Credit impairment	-42	160	56	- 4	0	170
Profit before tax	15 890	4 915	3 696	1 316	0	25 817
Tax expense	2 892	822	709	522	0	4 945
Profit for the period	12 998	4 093	2 987	794	0	20 872
Profit for the period attributable to:
Shareholders of Swedbank AB	12 997	4 093	2 987	794	0	20 871
Non-controlling interests	1	0	0	0	0	1
Net commission income
Commission income
Payment processing	730	647	649	122	-30	2 118
Cards	2 096	1 618	2 327	0	-363	5 678
Asset management and custody	7 595	413	1 874	-18	-318	9 546
Lending	210	163	840	7	- 7	1 213
Other commission income2	2 142	539	1 131	47	- 7	3 852
Total Commission income	12 773	3 380	6 821	158	-725	22 407
Commission expense	3 568	777	3 601	334	-726	7 554
Net commission income	9 205	2 603	3 220	-176	1	14 853
Balance sheet, SEKbn
Cash and balances with central banks	2	3	173	184	- 2	360
Loans to credit institutions	6	0	128	191	-285	40
Loans to the public	1 252	199	252	0	0	1 703
Interest-bearing securities	0	1	55	168	- 2	222
Financial liabilities for which customers bears the investment risk	321	8	0	0	0	329
Investments in associates and joint ventures	6	0	0	2	0	8
Derivatives	0	0	60	38	-57	41
Tangible and intangible assets	2	12	2	9	0	25
Other assets	3	139	18	358	-495	23
Total assets	1 592	362	688	950	-841	2 751
Amounts owed to credit institutions	27	0	217	97	-248	93
Deposits and borrowings from the public	712	329	235	1	-11	1 266
Debt securities in issue	0	1	5	733	- 3	736
Financial liabilities for which customers bears the investment risk	322	8	0	0	0	330
Derivatives	0	0	57	28	-57	28
Other liabilities	466	0	143	-18	-522	69
Senior non-preferred liabilities	0	0	0	38	0	38
Subordinated liabilities	0	0	0	29	0	29
Total liabilities	1 527	338	657	908	-841	2 589
Allocated equity	65	24	31	42	0	162
Total liabilities and equity	1 592	362	688	950	-841	2 751
Key figures
Return on allocated equity, %	20.0	16.6	9.3	2.2	0.0	13.2
Cost/income ratio	0.40	0.44	0.54	0.62	0.00	0.44
Credit impairment ratio, %	0.00	0.09	0.02	-0.01	0.00	0.01
Loan/deposit ratio, %	176	61	104	52	0	133
Loans to the public, stage 3, SEKbn3 (gross)	2	1	3	0	0	6
Loans to the public, total, SEKbn3	1 252	199	228	0	0	1 679
Provisions for loans to the public, total, SEKbn3	1	1	3	0	0	5
Deposits from the public, SEKbn3	712	329	220	0	0	1 261
Risk exposure amount, SEKbn	405	107	168	28	0	708
Full-time employees	4 041	4 257	2 460	5 807	0	16 565
Allocated equity, average, SEKbn	65	25	32	37	0	159

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.

3) Excluding the Swedish National Debt Office and repurchase agreements.

Full-year 2020			Large	Group
	Swedish	Baltic	Corporates &	Functions
SEKm	Banking	Banking	Institutions	& Other	Eliminations	Group
Income statement
Net interest income	16 277	5 354	3 834	1 416	-28	26 853
Net commission income	7 922	2 430	2 436	-137	119	12 770
Net gains and losses on financial items Other income1	351 1 593	337 912	1 897 116	71 1 050	- 1 -273	2 655 3 398
Total income	26 143	9 033	8 283	2 400	-183	45 676
Staff costs	3 050	1 381	2 327	4 767	-14	11 511
Variable staff costs	47	50	94	171	0	362
Other expenses	6 875	2 018	1 434	-3 051	-169	7 107
Depreciation/amortisation	53	175	248	1 104	0	1 580
Administrative fine	0	0	0	4 000	0	4 000
Total expenses	10 025	3 624	4 103	6 991	-183	24 560
Profit before impairment	16 118 0	5 409 2	4 180 0	-4 591 0	0 0	21 116 2
Impairment of tangible assets Credit impairment	664	237	3 425	8	0	4 334
Profit before tax	15 454	5 170	755	-4 599	0	16 780
Tax expense	3 008	864	-271	250	0	3 851
Profit for the period	12 446	4 306	1 026	-4 849	0	12 929
Profit for the period attributable to:	0	0	0	0	0	0
Shareholders of Swedbank AB	12 446	4 306	1 026	-4 849	0	12 929
Non-controlling interests	0	0	0	0	0	0
Net commission income
Commission income
Payment processing	719	647	585	61	7	2 019
Cards	2 168	1 543	1 969	- 6	-423	5 251
Asset management and custody	5 943	341	1 473	-13	-260	7 484
Lending	219	167	666	12	- 7	1 057
Other commission income2	2 136	503	991	43	- 8	3 665
Total Commission income	11 185	3 201	5 684	97	-691	19 476
Commission expense	3 263	771	3 248	234	-810	6 706
Net commission income	7 922	2 430	2 436	-137	119	12 770
Balance sheet, SEKbn
Cash and balances with central banks	1	3	131	160	- 1	294
Loans to credit institutions	7 1 211	0 182	109 263	264 25	-332 0	48 1 681
Loans to the public Interest-bearing securities	0	1	52	147	- 3	197
Financial liabilities for which customers bears the investment risk	246	6	0	0	0	252
Investments in associates	5	0	0	2	0	7
Derivatives	0	0	65	33	-46	52
Tangible and intangible assets	2	12	2	8	0	24
Other assets	4	110	25	354	-453	40
Total assets	1 476	314	647	993	-835	2 595
Amounts owed to credit institutions	27	0	263	179	-319	150
Deposits and borrowings from the public	646	284	226	2	-10	1 148
Debt securities in issue Financial liabilities for which customers bears the investment risk	0 247	0 6	7 0	730 0	- 4 0	733 253
Derivatives	0	0	67	33	-46	54
Other liabilities	489	0	51	-15	-456	69
Senior non-preferred liabilities	0	0	0	10	0	10
Subordinated liabilities	0	0	0	23	0	23
Total liabilities	1 409	290	614	962	-835	2 440
Allocated equity	67	24	33	31	0	155
Total liabilities and equity	1 476 0	314 0	647 0	993 0	-835 0	2 595 0
Key figures	0	0	0	0	0	0
Return on allocated equity, %	18.6	17.4	3.2	-21.7	0.0	8.9
Cost/income ratio	0.38	0.40	0.50	2.91	0.0	0.54
Credit impairment ratio, %	0.06	0.12	1.16	0.04	0.0	0.26
Loan/deposit ratio, %	187	64	111	46	0.0	143
Loans to the public, stage 3, SEKbn3 (gross)	2	2	7	0	0.0	11
Loans to the public, total, SEKbn3	1 211	182	223	0	0.0	1 616
Provisions for loans to the public, total, SEKbn3	2	1	5	0	0.0	8
Deposits, SEKbn3	646	284	200	1	0.0	1131
Risk exposure amount, SEKbn	391	92	168	39	0	690
Full-time employees Allocated equity, average, SEKbn	3 962 67	4 265 25	2 374 32	5 612 22	0.0 0.0	16 213 146

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.

3) Excluding the Swedish National Debt Office and repurchase agreements.

Operating segments accounting policies

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.

During the first half of 2021, minor changes between Swedbank's operating segments were made to coincide with the organisational changes. Comparative figures have been restated.

Group Q4 Q3 Q4 Full-year Full-year SEKm 2021 2021 2020 2021 2020 Interest income Cash and balances with central banks -295 -312 -165 -1 129 -547 Treasury bills and other bills eligible for refinancing with central banks, etc. 37 18 15 86 76 Loans to credit institutions 61 44 46 189 314 Loans to the public 7 657 7 674 7 892 30 624 32 645 Bonds and other interest-bearing securities 41 42 57 177 378 Derivatives¹ 280 -67 56 292 637 Other assets -62 42 46 63 190 Total 7 719 7 441 7 947 30 302 33 693 Deduction of trading-related interests reported in Net gains and losses on financial items -109 -4 -157 -62 -98 Total interest income 7 828 7 445 8 104 30 364 33 791 Interest expense Amounts owed to credit institutions 83 28 10 208 -204 Deposits and borrowings from the public -61 -130 -224 -354 -847 of which deposit guarantee fees -148 -142 -212 -461 -566 Debt securities in issue -1 115 -1 102 -1 422 -4 633 -7 282 Senior non-preferred liabilities -70 -67 10 -213 -102 Subordinated liabilities -226 -198 -170 -764 -821 Derivatives¹ 469 910 561 2 879 3 450 Other liabilities -211 -216 -233 -871 -962 of which resolution fund fee -192 -198 -220 -791 -863 Total -1 131 -775 -1 468 -3 748 -6 768 Deduction of trading-related interests reported in Net gains and losses on financial items 143 80 69 359 170 Total interest expense -1 274 -855 -1 537 -4 107 -6 938 Net interest income 6 554 6 590 6 567 26 257 26 853 Net investment margin before trading-related interests are deducted 0.88 0.89 0.97 0.92 1.01 Average total assets 2 985 729 2 998 524 2 673 367 2 888 870 2 670 861 Interest expense on financial liabilities at amortised cost 944 1 488 1 839 5 850 9 237 Negative yield on financial assets 380 395 329 1 405 1 554 Negative yield on financial liabilities 384 241 164 1 072 497

Note 5 Net interest income

1) 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.

Note 6 Net commission income

Group SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Commission income
Payment processing	564	524	526	2 118	2 019
Cards	1 545	1 563	1 309	5 678	5 251
Service concepts	329	320	310	1 280	1 240
Asset management and custody	2 539	2 477	2 075	9 546	7 484
Insurance	167	172	164	684	690
Securities and corporate finance	337	170	299	948	810
Lending	301	320	280	1 213	1 057
Other	239	197	222	940	925
Total commission income	6 021	5 743	5 185	22 407	19 476
Commission expense
Payment processing	-343	-325	-285	-1 309	-1 128
Cards	-723	-736	-783	-2 713	-2 719
Service concepts	-34	-41	-44	-157	-156
Asset management and custody	-612	-593	-471	-2 308	-1 763
Insurance	-88	-86	-74	-336	-280
Securities and corporate finance	-93	-86	-73	-344	-328
Lending	-47	-39	-36	-157	-119
Other	-61	-38	-43	-230	-213
Total commission expense	-2 001	-1 944	-1 809	-7 554	-6 706
Net commission income
Payment processing	221	199	241	809	891
Cards	822	827	526	2 965	2 532
Service concepts	295	279	266	1 123	1 084
Asset management and custody	1 927	1 884	1 604	7 238	5 721
Insurance	79	86	90	348	410
Securities and corporate finance	244	84	226	604	482
Lending	254	281	244	1 056	938
Other	178	159	179	710	712
Total net commission income	4 020	3 799	3 376	14 853	12 770

Note 7 Net gains and losses on financial items

Group SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Fair value through profit or loss
Shares and share related derivatives	46	73	128	419	369
of which dividend	53	85	18	267	47
Interest-bearing securities and interest related derivatives	-240	85	434	-69	928
Financial liabilities	2	2	6	11	36
Other financial instruments	5	-1	3	3	-15
Total fair value through profit or loss	-187	159	571	364	1 318
Hedge accounting
Ineffectiveness, one-to-one fair value hedges	58	22	58	54	3
of which hedging instruments	-2 623	-1 413	-1 185	-8 333	3 314
of which hedged items	2 681	1 435	1 243	8 387	-3 311
Ineffectiveness, portfolio fair value hedges	-18	-2	-40	1	-27
of which hedging instruments	1 506	627	594	3 527	-1 531
of which hedged items	-1 524	-629	-634	-3 526	1 504
Ineffectiveness, cash flow hedges	1	0	0	1	-2
Total hedge accounting	41	20	18	56	-26
Amortised cost
Derecognition gain or loss for financial assets	52	46	63	208	214
Derecognition gain or loss for financial liabilities	-15	-5	1	-32	-112
Total amortised cost	37	41	64	176	102
Trading related interest
Interest income	-109	-4	-157	-62	-98
Interest expense	143	80	69	359	170
Total trading related interest	34	76	-88	297	72
Change in exchange rates	340	257	345	1 155	1 189
Total net gains and losses on financial items	265	553	910	2 048	2 655

Note 8 Other general administrative expenses

Group SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Premises	146	108	163	454	459
IT expenses	803	598	587	2 550	2 318
Telecommunications and postage	39	29	54	126	162
Consultants	310	192	271	933	1 545
Compensation to savings banks	57	56	57	228	231
Other purchased services	272	242	372	939	1 054
Travel	11	4	5	18	62
Entertainment	9	6	9	22	26
Supplies	36	13	33	79	95
Advertising, PR and marketing	148	58	198	301	420
Security transport and alarm systems	19	18	16	71	68
Repair/maintenance of inventories	41	31	19	126	94
Other administrative expenses	151	131	131	498	468
Other operating expenses	28	27	59	132	105
Total other general administrative expenses	2 070	1 513	1 974	6 477	7 107

Note 9 Credit impairments

Group	Q4	Q3	Q4	Full-year	Full-year
SEKm	2021	2021	2020	2021	2020
Loans at amortised cost
Credit impairment provisions - stage 1	87	-11	-13	-71	403
Credit impairment provisions - stage 2	-430	-117	62	-596	1 094
Credit impairment provisions - stage 3	-660	167	-412	-2 884	561
Credit impairment provisions - purchased or originated credit impaired	0	-1	-2	-3	-4
Total	-1 003	38	-365	-3 554	2 054
Write-offs	992	61	1 149	4 157	2 166
Recoveries	-41	-49	-43	-225	-174
Total	951	12	1 106	3 932	1 992
Total - loans at amortised cost	-52	50	741	378	4 046
Other assets at amortised cost	0	0	0	-7	6
Loan commitments and guarantees
Credit impairment provisions - stage 1	41	16	5	26	149
Credit impairment provisions - stage 2	28	-36	-61	-139	269
Credit impairment provisions - stage 3	-84	-12	-162	-88	-136
Total	-15	-32	-218	-201	282
Write-offs	0	0	0	0	0
Total - loan commitments and guarantees	-15	-32	-218	-201	282
Total credit impairments	-67	18	523	170	4 334
Credit impairment ratio, %	-0.02	0.00	0.12	0.01	0.26

During the year, the Group has reduced its gross exposure in the Shipping and offshore sector through sales and restructuring, resulting in write offs of the gross exposures. The majority of the Stage 3 exposures that were written off were previously provisioned.

Calculation of credit impairment provisions

The measurement of expected credit losses is described in Note G3.1 Credit risks on pages 73-77 of the 2020 Annual and Sustainability Report. There have been no significant changes during the year to the methodology.

Measurement of 12-month and lifetime expected credit losses

The onset of Covid-19 in 2020 brought a deterioration of macroeconomic indicators – inter alia GDP growth, housing and property prices, unemployment, oil prices and interest rates – that would typically have contributed to increased credit risk. The downturn, however did, not result in the increased credit losses or default rates that would be expected from historical experience of similar economic shocks. Support measures have thus far been successful in limiting the economic impacts of Covid-19 but there is a risk that credit quality may start to deteriorate as the impacts of the support measures dissipate.. Uncertainties which could further delay the recovery continue to exist, including in relation to unvaccinated populations, new virus variants,the potential for further outbreaks and localised restrictions. As the quantitative risk models do not appropriately incorporate these dynamics, post-model adjustments to increase the credit impairment provisions continue to be deemed necessary.

The post-model expert credit adjustments increased to SEK 1 796m (SEK 1 533m as of 31 December 2020), attributable to continued uncertainty in certain sectors.

The post-model expert credit adjustments are allocated as SEK 723m in stage 1, SEK 1 071m in stage 2 and SEK 2m in stage 3. The most significant adjustments are in the Shipping and offshore, Hotels and restaurants, Retails and wholesale and Manufacturing sectors.

Determination of 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:

• changes in the 12-month PD and internal risk rating grades, which have been applied for the portfolio of loans originated before 1 January 2018. For instance, for exposures originated with a risk grade between 0 and 5, a downgrade by 1 to 2 grades from initial recognition is assessed as a significant change in credit risk. Alternatively, for exposures originated with a risk grade between 13 and 21, a downgrade by 3 to 8 grades from initial recognition is considered significant. Internal risk ratings are assigned according to the risk management framework outlined in Note G3 Risks in the 2020 Annual and Sustainability Report.
• changes in the lifetime PD, which have been applied for the portfolio of loans originated on or after 1 January 2018. For instance, for exposures originated with a risk grade between 0 and 5, a 50 per cent increase in the lifetime

PD from initial recognition is assessed as a significant change in credit risk. Alternatively, for exposures originated with a risk grade between 13 and 21, an increase of 100-300 per cent from initial recognition is considered significant.

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.

Significant increase in credit risk - financial instruments with initial recognition before 1 January 2018

				Impairment provision impact of			Impairment provision impact of
Internal risk grade at initial recognition	12-month PD band at initial recognition, %	Threshold, rating downgrade1, 2, 3	Increase in threshold by 1 grade, %	Decrease in threshold by 1 grade, %	Recognised credit impairment provisions 31 Dec 2021	Share of total portfolio in terms of gross carrying amount, % 31 Dec 2021	Increase in threshold by 1 grade,%	Decrease in threshold by 1 grade, %	Recognised credit impairment provisions 31 Dec 2020	Share of total portfolio in terms of gross carrying amount, % 31 Dec 2020
18-21	<0.1	5 - 8 grades	-6.4	14.9	43	15	-6.2	8.4	53	17
13-17	0.1 - 0.5	3 - 7 grades	-5.5	6.8	214	15	-7.8	6.9	461	18
9-12	>0.5 - 2.0	1 - 5 grades	-21.8	16.0	159	5	-13.5	13.0	330	7
6-8	2.0 - 5.7	1 - 3 grades	-7.9	4.9	60	2	-11.5	4.0	84	3
0-5	>5.7 - 99,9	1 grade	-2.2	0.0	38	1	-0.9	0.0	141	1
			-11.2	9.5	514	38	-9.0	7.7	1 069	46
		Sovereigns and financial institutions with low credit risk			1	9			17	8
				Stage 3 financial instruments	961	0			2 207	0
			Post-model expert credit adjustment4		595	0			673	0
				Total5	2 071	47			3 966	54

1) Downgrade by 2 grades corresponds to approximately 100 per cent increase in 12-month PD.

2) Thresholds vary within given ranges depending on the borrower's geography, segment and internal risk grade.

3) The threshold used in the sensitivity analyses is floored to 1 grade.

4) Represents post-model expert credit adjustments for stage 1 and stage 2.

5) Of which provisions for off-balance exposures are SEK 284m (499).

Significant increase in credit risk - financial instruments with initial recognition on or after 1 January 2018

		Impairment provision impact of Impairment provision impact of
Internal risk grade at initial recognition	Threshold, increase in lifetime PD1 , %	Increase in threshold by 100%, %	Decrease in threshold by 50%, %	Recognised credit impairment provisions 31 Dec 2021	Share of total portfolio in terms of gross carrying amount, % 31 Dec 2021	Increase in threshold by 100%, %	Decrease in threshold by 50%, %	Recognised credit impairment provisions 31 Dec 2020	Share of total portfolio in terms of gross carrying amount, % 31 Dec 2020
18-21	200-300	-15.7	22.8	24	18	-6.7	28.4	25	14
13-17	100-250	-1.1	5.8	287	20	-2.8	4.0	315	17
9-12	100-200	-5.8	1.0	293	9	-4.8	2.2	413	8
6-8	50-150	-0.6	2.4	140	3	-0.7	0.9	143	3
0-5	50	0.1	0.7	94	1	0.0	0.1	299	1
		-3.0	3.5	838	51	-2.6	2.5	1 195	43
	Sovereigns and financial institutions with low credit risk			7	2			15	3
			Stage 3 financial instruments	1 551	0			2 952	0
		Post-model expert credit adjustment2		1 199	0			847	0
			3 Total	3 595	53			5 009	46

1) Thresholds vary within given ranges depending on the borrower's geography, segment and internal risk grade.

2) Represents post-model expert credit adjustments for stage 1 and stage 2.

3) Of which provisions for off-balance exposures are SEK 360m (307).

Incorporation of forward-looking macroeconomic scenarios

The Swedbank Economic Outlook was published on 16 November which serves as the base scenario, with an assigned probability weight of 66.6 per cent. Aligned with the updated base scenario, new alternative scenarios were developed, with assigned probability

weights of 16.7 per cent on both the upside and downside scenario. These new macroeconomic scenarios were included in the expected credit losses calculations according to the Group's monthly process.

IFRS 9 scenarios

31 December 2021	Positive scenario				Baseline scenario				Negative scenario
	2021 1	2022	2023	2024	2021 1	2022	2023	2024 2	2021 1	2022	2023	2024
Sweden
GDP (annual % change)	4.7	4.3	2.3	1.7	4.7	3.4	2.2	2.0	4.7	-5.7	1.5	3.3
Unemployment (annual %)3	8.9	7.4	6.9	6.8	8.9	7.6	7.2	7.0	8.9	9.4	10.6	9.5
House prices (annual % change)	15.6	8.5	4.9	3.2	15.6	7.5	3.9	2.8	15.6	-2.1	-2.9	-0.8
Stibor 3m (%)	-0.02	0.08	0.17	0.71	-0.02	0.08	0.13	0.58	-0.02	0.26	0.14	0.12
Estonia
GDP (annual % change)	8.3	5.6	3.4	3.0	8.3	4.0	3.2	3.0	8.3	-4.1	3.5	3.2
Unemployment (annual %)	6.4	5.5	4.8	4.9	6.4	5.8	5.4	5.2	6.4	7.8	8.5	7.9
House prices (annual % change)	10.1	9.0	6.0	5.3	10.1	8.0	5.0	5.0	10.1	-8.8	1.5	6.8
Latvia
GDP (annual % change)	4.7	5.8	3.5	2.9	4.7	4.6	3.5	3.0	4.7	-4.3	3.6	3.8
Unemployment (annual %)	7.5	6.4	5.8	5.6	7.5	6.7	6.0	5.9	7.5	9.0	9.5	8.9
House prices (annual % change)	6.0	9.7	6.3	5.0	6.0	8.1	6.0	5.5	6.0	-10.4	-0.4	7.6
Lithuania
GDP (annual % change)	5.0	4.3	3.4	2.8	5.0	3.3	3.3	2.9	5.0	-5.4	3.1	3.1
Unemployment (annual %)	7.0	5.9	5.5	5.3	7.0	6.5	6.3	6.0	7.0	8.6	9.2	8.5
House prices (annual % change)	9.4	5.4	5.8	5.7	9.4	4.7	4.9	5.0	9.4	-11.3	3.6	7.1
Global indicators
US GDP (annual %)	5.5	4.9	3.1	1.4	5.5	4.1	3.2	1.9	5.5	-1.3	-1.0	1.8
EU GDP (annual %)	5.0	5.1	2.7	1.6	5.0	4.2	2.3	1.7	5.0	-2.0	0.3	2.8
Brent Crude Oil (USD/Barrel)	71.5	79.0	75.8	73.0	71.5	77.5	72.6	69.6	71.5	44.4	32.8	43.0
Euribor 6m (%)	-0.52	-0.46	-0.06	0.50	-0.52	-0.47	-0.45	-0.32	-0.52	-0.04	-0.43	-0.44

1) Forecasted 2021 values, as the actual offical numbers were not published when the scenarios were set.

2) The baseline scenario for 2021, 2022 and 2023 are based on the published Swedbank Economic Outlook. The baseline scenario variables for 2024 are model-based extrapolations.

3) Unemployment rate, 16-64 years.

The global economic recovery goes on, and the outlook for 2022 and 2023 still looks relatively bright. However, the global GDP forecast has been revised down compared to August on the back of lower expected growth in the US and China. Supply problems are weighing on trade-dependent sectors, and, in many European countries, both retail sales and industrial production have more or less stagnated over the past year. The Chinese economy has also lost momentum during the year. The world economy is expected to grow by 4.3 per cent in 2022 and 3.9 per cent in 2023.

The economic recovery in Sweden will continue over the next few years but at a somewhat slower pace. The rise

in inflation is to some extent protracted, which means that the Riksbank will slowly ease its stimulus over the next few years. Household consumption remains the major driver of the economic recovery. The labour market is improving but matching issues are increasing.

The spread of the virus picked up in many countries during the autumn, although the number of new serious cases and deaths overall remains relatively low in the US and the EU. The baseline scenario assumes that the high vaccination rates will be enough to contain the virus and keep those economies mostly open.

Sensitivity

Set out below are the credit impairment provisions that would result from the negative and positive scenarios, which are considered reasonably possible, being assigned probabilities of 100 per cent. Post-model expert credit adjustments are assumed to be constant in the results.

		31 Dec 2021			31 Dec 2020
			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 adjustment	Negative scenario	Positive scenario
Swedish Banking	1 558	447	1 632	1 530	1 788	424	1 969	1 690
Baltic Banking	895	389	982	819	754	242	872	669
LC&I	3 206	960	3 615	2 858	6 423	867	7 471	5 640
Group1	5 666	1 796	6 235	5 212	8 975	1 533	10 323	8 010

1) Including operating segment Group Functions & Other.

Note 10 Loans

31 December 2021		Stage 1	Stage 31 Stage 2
Group SEKm	Gross carrying amount	Credit impairment provisions	Net	Gross carrying amount	Credit impairment provisions	Net	Gross carrying amount	Credit impairment provisions	Net	Total
Loans to the public at amortised cost
Private customers	1 090 376	98	1 090 278	42 148	259	41 889	1 844	480	1 364	1 133 531
Private mortgage	954 265	31	954 234	35 629	140	35 489	1 254	220	1 034	990 757
Tenant owner associations	90 670	2	90 668	1 015	3	1 012	0	0	0	91 680
Private other	45 441	65	45 376	5 504	116	5 388	590	260	330	51 094
Corporate customers	488 113	700	487 413	56 458	1 530	54 928	4 518	1 947	2 571	544 912
Agriculture, forestry, fishing	56 741	7	56 734	6 646	50	6 596	195	27	168	63 498
Manufacturing	33 379	108	33 271	3 715	181	3 534	161	82	79	36 884
Public sector and utilities	28 922	10	28 912	2 398	29	2 369	15	2	13	31 294
Construction	17 143	14	17 129	2 753	51	2 702	180	35	145	19 976
Retail and wholesale	26 470	76	26 394	3 527	178	3 349	134	40	94	29 837
Transportation	11 187	8	11 179	2 079	36	2 043	29	7	22	13 244
Shipping and offshore	7 983	264	7 719	2 353	364	1 989	2 966	1 526	1 440	11 148
Hotels and restaurants	3 480	66	3 414	3 801	309	3 492	390	53	337	7 243
Information and communication	14 576	14	14 562	1 199	11	1 188	2	0	2	15 752
Finance and insurance	18 021	8	18 013	569	3	566	14	3	11	18 590
Property management, including	239 228	105	239 123	21 827	213	21 614	267	125	142	260 879
Residential properties	76 842	27	76 815	6 884	65	6 819	64	12	52	83 686
Commercial	98 300	49	98 251	9 355	80	9 275	166	108	58	107 584
Industrial and Warehouse	40 619	13	40 606	2 950	14	2 936	23	2	21	43 563
Other	23 467	16	23 451	2 638	54	2 584	14	3	11	26 046
Professional services	17 053	8	17 045	2 514	42	2 472	86	25	61	19 578
Other corporate lending	13 930	12	13 918	3 077	63	3 014	79	22	57	16 989
Loans to the public at fair value through profit or loss	0	0	0	0	0	0	0	0	0	199
Loans to the public excluding the Swedish National Debt Office and repurchase agreements	1 578 489	798	1 577 691	98 606	1 789	96 817	6 362	2 427	3 935	1 678 642
of which cash collaterals posted	1 832	0	1 832	0	0	0	0	0	0	1 832
of which customer lending	1 576 657	798	1 575 859	98 606	1 789	96 817	6 362	2 427	3 935	1 676 810
Swedish National Debt Office Repurchase agreements2	3 0	0 0	3 0	0 0	0 0	0 0	0 0	0 0	0 0	3 24 561
Loans to the public	1 578 492	798	1 577 694	98 606	1 789	96 817	6 362	2 427	3 935	1 703 206
Banks and other credit institutions	38 102	8	38 094	27	0	27	0	0	0	38 121
Repurchase agreements2	0	0	0	0	0	0	0	0	0	1 383
Loans to credit institutions	38 102	8	38 094	27	0	27	0	0	0	39 504
Loans to the public and credit institutions	1 616 594	806	1 615 788	98 633	1 789	96 844	6 362	2 427	3 935	1 742 710
Share of loans, %	93.90	0.00	0.00	5.73	0.00	0.00	0.37	0.00	0.00	100
Credit impairment provision ratio, %	0.05	0.00	0.00	1.81	0.00	0.00	38.15	0.00	0.00	0.29

1) Including purchased or originated credit impaired.

2) At fair value through profit or loss.

31 December 2020		Stage 1			Stage 2			Stage 31
Group SEKm	Gross carrying amount	Credit impairment provisions	Net	Gross carrying amount	Credit impairment provisions	Net	Gross carrying amount	Credit impairment provisions	Net	Total
Loans to the public at amortised cost
Private customers	1 036 489	118	1 036 371	42 251	291	41 960	2 152	505	1 647	1 079 978
Private mortgage	902 233	51	902 182	35 323	171	35 152	1 531	290	1 241	938 575
Tenant owner associations	91 286	4	91 282	1 582	5	1 577	109	2	107	92 966
Private other	42 970	63	42 907	5 346	115	5 231	512	213	299	48 437
Corporate customers	468 798	709	468 089	66 009	2 025	63 984	8 378	4 493	3 885	535 958
Agriculture, forestry, fishing	57 258	11	57 247	7 283	57	7 226	204	33	171	64 644
Manufacturing	32 876	133	32 743	5 910	141	5 769	298	97	201	38 713
Public sector and utilities	24 821	13	24 808	990	16	974	53	12	41	25 823
Construction	14 952	32	14 920	4 643	122	4 521	159	40	119	19 560
Retail and wholesale	23 019	67	22 952	5 955	244	5 711	531	216	315	28 978
Transportation	11 480	8	11 472	1 483	28	1 455	19	4	15	12 942
Shipping and offshore	6 634	32	6 602	4 251	560	3 691	6 235	3 917	2 318	12 611
Hotels and restaurants	4 339	49	4 290	4 655	313	4 342	323	27	296	8 928
Information and communication	11 041	10	11 031	2 569	35	2 534	13	3	10	13 575
Finance and insurance	20 083	29	20 054	744	12	732	22	10	12	20 798
Property management, including	224 852	272	224 580	22 533	376	22 157	244	62	182	246 919
Residential properties	65 530	74	65 456	8 517	99	8 418	22	11	11	73 885
Commercial	92 881	125	92 756	7 123	118	7 005	162	40	122	99 883
Industrial and Warehouse	42 009	47	41 962	2 721	18	2 703	33	7	26	44 691
Other	24 432	26	24 406	4 172	141	4 031	27	4	23	28 460
Professional services	17 896	35	17 861	3 283	76	3 207	169	44	125	21 193
Other corporate lending	19 547	18	19 529	1 710	45	1 665	108	28	80	21 274
Loans to the public at fair value through profit or loss	0	0	0	0	0	0	0	0	0	101
Loans to the public excluding the Swedish National
Debt Office and repurchase agreements	1 505 287	827	1 504 460	108 260	2 316	105 944	10 530	4 998	5 532	1 616 037
of which cash collaterals posted	9 630	0	9 630	0	0	0	0	0	0	9 630
of which customer lending	1 495 657	827	1 494 830	108 260	2 316	105 944	10 530	4 998	5 532	1 606 407
Swedish National Debt Office	25 003	0	25 003	0	0	0	0	0	0	25 003
Repurchase agreements2	0	0	0	0	0	0	0	0	0	39 947
Loans to the public	1 530 290	827	1 529 463	108 260	2 316	105 944	10 530	4 998	5 532	1 680 987
Banks and other credit institutions	46 367	28	46 339	33	0	33	0	0	0	46 372
Repurchase agreements2	0	0	0	0	0	0	0	0	0	1 582
Loans to credit institutions	46 367	28	46 339	33	0	33	0	0	0	47 954
Loans to the public and credit institutions	1 576 657	855	1 575 802	108 293	2 316	105 977	10 530	4 998	5 532	1 728 941
Share of loans, %	92.99	0	0	6.39	0.00	0.00	0.62	0.00	0.00	100
Credit impairment provision ratio, %	0.05	0.00	0.00	2.14	0.00	0.00	47.46	0.00	0.00	0.48

1) Including purchased or originated credit impaired. 2) At fair value through profit or loss.

Note 11 Credit impairment provisions

Reconciliation of credit impairment provisions for loans

The tables below provide a reconciliation of credit impairment provisions for loans to the public and credit institutions at amortised cost. Stage transfers are reflected as taking place at the end of the reporting period.

Loans to the public and credit institutions		2021			2020
Group
SEKm	Stage 1	Stage 2	Stage 31	Total	Stage 1	Stage 2	Stage 31	Total
Carrying amount before provisions
Opening balance 1 January	1 576 657	108 293	10 530	1 695 480	1 537 745	106 264	13 593	1 657 602
Closing balance 31 December	1 616 594	98 633	6 362	1 721 589	1 576 657	108 293	10 530	1 695 480
Credit impairment provisions
Opening balance 1 January	855	2 316	4 998	8 169	483	1 348	4 853	6 684
Movements affecting credit impairments
New and derecognised financial assets, net	61	-396	-3 854	-4 189	93	89	-1 906	-1 724
Changes in risk factors (EAD, PD, LGD)	18	-266	5	-243	139	-117	7	29
Changes in macroeconomic scenarios	-110	-157	-1	-268	-21	-90	-5	-116
Post-model expert credit adjustments	86	78	-12	152	387	823	13	1 223
Individual assessments	0	0	826	826	0	0	2 388	2 388
Stage transfers	-127	145	232	250	-195	389	227	421
from 1 to 2	-138	316	0	178	-206	496	0	290
from 1 to 3	-1	0	62	61	-2	0	89	87
from 2 to 1	12	-90	0	-78	12	-75	0	-63
from 2 to 3	0	-89	228	139	0	-37	201	164
from 3 to 2	0	8	-48	-40	0	5	-30	-25
from 3 to 1	0	0	-10	-10	1	0	-33	-32
Other	1	0	-82	-81	0	0	-166	-166
Total movements affecting credit impairments	-71	-596	-2 886	-3 553	403	1 094	558	2 055
Movements recognised outside credit impairments
Interest	0	0	82	82	0	0	166	166
Change in exchange rates	22	69	233	324	-31	-126	-579	-736
Closing balance 31 December	806	1 789	2 427	5 022	855	2 316	4 998	8 169
Carrying amount Opening balance 1 January	1 575 802	105 977	5 532	1 687 311	1 537 262	104 916	8 740	1 650 918
Closing balance 31 December	1 615 788	96 844	3 935	1 716 567	1 575 802	105 977	5 532	1 687 311

1) Including purchased or originated credit impaired.

Loan commitments and financial guarantees

The tables below provide a reconciliation of credit impairment provisions for loan commitments and financial guarantees. Stage transfers are reflected as taking place at the end of the reporting period.

		2021			2020
SEKm	Stage 1	Stage 2	Stage 31	Total	Stage 1	Stage 2	Stage 31	Total
Nominal amount
Opening balance 1 January	358 988	17 341	542	376 871	322 384	11 325	1 248	334 957
Closing balance 31 December	306 298	16 134	221	322 653	358 988	17 341	542	376 871
Credit impairment provisions
Opening balance 1 January	249	396	161	806	113	144	326	583
Movements affecting credit impairments
New and derecognosed financial assets, net	-1	-21	-91	-113	25	5	-198	-168
Changes in risk factors (EAD, PD, LGD)	-20	-57	6	-71	21	32	-10	43
Changes in macroeconomic scenarios	-36	-45	0	-81	-3	-4	0	-7
Post-model expert credit adjustments	86	-17	0	69	132	178	0	310
Individual assessments	0	0	-3	-3	0	0	2	2
Stage transfers	-3	1	0	-2	-26	58	70	102
from 1 to 2	-5	15	0	10	-28	77	0	49
from 1 to 3	0	0	1	1	-1	0	12	11
from 2 to 1	3	-14	0	-11	3	-10	0	-7
from 2 to 3	0	0	2	2	0	-9	59	50
from 3 to 2	0	0	-3	-3	0	0	-1	-1
from 3 to 1	-1	0	0	-1	0	0	0	0
Other	0	0	0	0	0	0	0	0
Total movements affecting credit impairments	26	-139	-88	-201	149	269	-136	282
Movements recognised outside credit impairments
Change in exchange rates	11	16	12	39	-13	-17	-29	-59
Closing balance 31 December	286	273	85	644	249	396	161	806

1) Including purchased or originated credit impaired.

Note 12 Credit risk exposures

Group	31 Dec	31 Dec
SEKm	2021	2020
Assets
Cash and balances with central banks	360 153	293 811
Interest-bearing securities	221 683	197 166
Loans to credit institutions	39 504	47 954
Loans to the public	1 703 206	1 680 987
Derivatives	40 531	52 177
Other financial assets	9 164	16 451
Total	2 374 241	2 288 546
Contingent liabilities and commitments
Guarantees	53 669	50 696
Loan commitments	268 984	326 175
Total	322 653	376 871
Total credit risk exposures	2 696 894	2 665 417

Note 13 Intangible assets

Group	31 Dec	31 Dec
SEKm	2021	2020
With indefinite useful life
Goodwill	13 501	13 327
Brand name	93	92
Total	13 594	13 419
With finite useful life
Customer base	251	293
Internally developed software	5 320	4 319
Other	323	330
Total	5 894	4 942
Total intangible assets	19 488	18 361

During the second quarter 2021, an impairment was recognised for internally developed software of SEK 56m. At 31 December 2021 there was no indication of additional impairment of intangible assets.

Note 14 Amounts owed to credit institutions

Group SEKm	31 Dec 2021	31 Dec 2020
Amounts owed to credit institutions
Central banks	28 171	79 715
Banks	58 354	60 110
Other credit institutions	5 473	7 195
Repurchase agreements	814	3 293
Amounts owed to credit institutions	92 812	150 313

Note 15 Deposits and borrowings from the public

Group	31 Dec	31 Dec
SEKm	2021	2020
Deposits from the public
Private customers	655 636	588 487
Corporate customers	604 991	542 860
Deposits from the public excluding the Swedish National Debt Office
and repurchase agreements	1 260 627	1 131 347
Swedish National Debt Office	68	69
Repurchase agreements - Swedish National Debt Office	0	0
Repurchase agreements	5 088	16 824
Deposits and borrowings from the public	1 265 783	1 148 240

Note 16 Debt securities in issue, senior non-preferred liabilities and subordinated liabilities

Group	31 Dec	31 Dec
SEKm	2021	2020
Commercial papers	165 067	127 209
Covered bonds	436 989	471 491
Senior unsecured bonds	129 809	128 437
Structured retail bonds	4 052	5 677
Total debt securities in issue	735 917	732 814
Senior non-preferred liabilities	37 832	10 359
Subordinated liabilities	28 604	23 434
Total debt securities in issue, senior non-preferred liabilities and subordinated liabilities	802 353	766 607

	Full-year	Full-year
Turnover	2021	2020
Opening balance	766 607	898 493
Issued	791 262	498 084
Repurchased	-25 873	-57 404
Repaid	-740 624	-553 284
Interest	1 625	6 498
Change in fair values or hedged items in fair value hedges	-3 351	2 689
Changes in exchange rates	12 707	-28 469
Closing balance	802 353	766 607

Note 17 Derivatives

		Nominal amount
		Remaining contractual maturity		Nominal amount		Positive fair value		Negative fair value
Group				31 Dec	31 Dec	31 Dec	31 Dec	31 Dec	31 Dec
SEKm	< 1 yr.	1-5 yrs.	> 5 yrs.	2021	2020	2021	2020	2021	2020
Derivatives in hedge accounting
One-to-one fair value hedges, interest rate swaps	141 732	327 295	48 309	517 336	514 849	8 156	14 953	1 675	37
Portfolio fair value hedges, interest rate swaps	135 659	350 300	9 315	495 274	457 647	1 969	137	853	2 412
Cash flow hedges, cross currency basis swaps	512	3 826	3 789	8 127	8 500	41	19	130	256
Total	277 903	681 421	61 413	1 020 737	980 996	10 166	15 109	2 658	2 705
Non-hedge accounting derivatives	6 059 407	10 592 527	8 293 818		24 945 752 19 302 025	174 838	126 813	170 723	143 547
Gross amount	6 337 310	11 273 948	8 355 231		25 966 489 20 283 021	185 004	141 922	173 381	146 252
Offset amount	-4 081 964	-9 868 821		-8 027 757 -21 978 542 -16 771 805		-144 473	-89 745	-145 275	-91 872
Total	2 255 346	1 405 127	327 474	3 987 947	3 511 216	40 531	52 177	28 106	54 380

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.

Note 18 Fair value of financial instruments

		31 Dec 2021			31 Dec 2020
Group	Fair	Carrying		Fair	Carrying
SEKm	value	amount	Difference	value	amount	Difference
Assets
Financial assets
Cash and balances with central banks	360 153	360 153	0	293 811	293 811	0
Treasury bills and other bills eligible for refinancing with central banks	163 600	163 590	10	137 206	137 191	15
Loans to credit institutions	39 504	39 504	0	47 954	47 954	0
Loans to the public	1 703 553	1 703 206	347	1 684 884	1 680 987	3 897
Value change of interest hedged items in portfolio hedge	-1 753	-1 753	0	1 774	1 774	0
Bonds and interest-bearing securities	58 093	58 093	0	59 976	59 975	1
Financial assets for which the customers bear the investment risk	328 512	328 512	0	252 411	252 411	0
Shares and participating interest	13 416	13 416	0	17 215	17 215	0
Derivatives	40 531	40 531	0	52 177	52 177	0
Other financial assets	9 164	9 164	0	16 451	16 451	0
Total	2 714 773	2 714 416	357	2 563 859	2 559 946	3 913
Investment in associates		7 705			7 287
Non-financial assets		28 496			27 409
Total		2 750 617			2 594 642
Liabilities
Financial liabilities
Amounts owed to credit institutions	92 812	92 812	0	150 313	150 313	0
Deposits and borrowings from the public	1 265 779	1 265 783	-4	1 148 231	1 148 240	-9
Debt securities in issue	740 327	735 917	4 410	738 196	732 814	5 382
Financial liabilities for which the customers bear the investment risk	329 667	329 667	0	253 229	253 229	0
Senior non-preferred liabilities	38 493	37 832	660	10 545	10 359	186
Subordinated liabilities	29 026	28 604	422	23 688	23 434	254
Derivatives	28 106	28 106	0	54 380	54 380	0
Short positions securities	28 613	28 613	0	23 300	23 300	0
Other financial liabilities	28 860	28 860	0	30 536	30 536	0
Total	2 581 683	2 576 194	5 488	2 432 418	2 426 605	5 813
Non-financial liabilities		12 727			12 844
Total		2 588 921			2 439 449

The Group uses various methods to determine the fair value of financial instruments depending on the degree of observable market data in the valuation and activity in the market. An active market is considered a regulated or reliable marketplace where quoted prices are easily accessible, and which demonstrates regularity. Activity is continuously evaluated by analysing factors such as differences in bid and ask prices.

The methods are divided into three different levels:

• Level 1: Unadjusted quoted price on an active market • Level 2: Adjusted quoted price or valuation model with valuation parameters derived from an active market • Level 3: Valuation model where significant valuation parameters are non-observable and based on internal assumptions.

For financial assets and financial liabilities, mid prices are used as a basis of determining fair value. For any open net positions, a bid/ask adjustment is applied to

ensure that long positions are recognised at bid price and short positions – at ask price.

The Group has a continuous process that identifies financial instruments which indicate a high level of internal assumptions or low level of observable market data. The process determines how to make the calculation based on how the internal assumptions are expected to affect the valuation. In cases where internal assumptions have a significant impact on fair value, the financial instrument is reported in level 3. The process also includes an analysis based on the quality of valuation data and whether any types of financial instruments will be transferred between the various levels.

Transfers between fair value hierarchy levels are reflected as taking place at the end of each quarter. During the period, there were no transfers of financial instruments between valuation levels 1 and 2.

The following tables present fair values of financial instruments recognised at fair value split between the three valuation hierarchy levels.

Financial instruments recognised at fair value

Group
31 December 2021
SEKm	Level 1	Level 2	Level 3	Total
Assets
Treasury bills etc.	27 580	7 487	0	35 067
Loans to credit institutions	0	1 383	0	1 383
Loans to the public	0	24 746	14	24 760
Bonds and other interest-bearing securities	29 272	28 821	0	58 093
Financial assets for which the customers bear the investment risk	328 512	0	0	328 512
Shares and participating interests	12 139	0	1 277	13 416
Derivatives	162	40 369	0	40 531
Total	397 665	102 806	1 291	501 762
Liabilities
Amounts owed to credit institutions	0	814	0	814
Deposits and borrowings from the public	0	5 088	0	5 088
Debt securities in issue	0	4 190	0	4 190
Financial liabilities for which the customers bear
the investment risk	0	329 667	0	329 667
Derivatives	123	27 983	0	28 106
Short positions, securities	25 738	2 875	0	28 613
Total	25 861	370 617	0	396 478

Group
31 December 2020
SEKm	Level 1	Level 2	Level 3	Total
Assets
Treasury bills etc.	18 968	3 300	0	22 268
Loans to credit institutions	0	1 582	0	1 582
Loans to the public	0	40 049	0	40 049
Bonds and other interest-bearing securities	22 676	37 264	0	59 940
Financial assets for which the customers bear
the investment risk	252 411	0	0	252 411
Shares and participating interests	16 088	0	1 127	17 215
Derivatives	85	52 092	0	52 177
Total	310 228	134 287	1 127	445 642
Liabilities
Amounts owed to credit institutions	0	3 294	0	3 294
Deposits and borrowings from the public	0	16 824	0	16 824
Debt securities in issue	0	6 767	0	6 767
Financial liabilities for which the customers bear
the investment risk	0	253 229	0	253 229
Derivatives	69	54 311	0	54 380
Short positions, securities	22 307	993	0	23 300
Total	22 376	335 418	0	357 794

Level 3 primarily contains unlisted equity instruments, where the price is unobservable and the sensitivity in the value to changes in the unobservable parameter is linear in the model applied. To estimate the unobservable price different methods are applied

depending on the type of available data. The primary method is based on executed transactions or quoted share price of similar equities. Other inputs to these methods are primarily prices, proxy prices, market indicators and company information.

Changes in level 3		2021 Assets		2020 Assets
Group SEKm	Equity instruments	Loans	Total	Equity instruments	Total
Opening balance 1 January	1 127	0	1 127	1 854	1 854
Purchases	13	5	18	9	9
Shares received	21	0	21	0	0
Sale of assets/ dividends received	-88	0	-88	-2	-2
Conversion Visa Inc shares	0	0	0	-819	-819
Issues	0	8	8	0	0
Gains or losses	204	1	205	85	85
of which changes in unrealised gains or losses for items held at closing day	135	0	135	95	95
Closing balance 31 December	1 277	14	1 291	1 127	1 127

Swedbank – Year-end report 2021 42

The level 3 unlisted equity instruments include strategic investments. Swedbank's holdings in VISA Inc. C shares are subject to selling restrictions for a period of up to 8 years 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. As of 31 December 2021, the carrying

amount for the holdings in Visa Inc. C amounts to SEK 675m (SEK 602m).

Financial instruments are transferred to or from level 3 depending on whether the internal assumptions have changed in significance to the valuation. There were no transfers of financial instruments to or from level 3 during the period.

Note 19 Assets pledged, contingent liabilities and commitments

Group SEKm	31 Dec 2021	31 Dec 2020
Loans secured for covered bonds1	473 539	561 209
Financial assets pledged for insurance policy holders	328 512	247 632
Other assets pledged for own liabilities	55 756	110 091
Other assets pledged	8 529	7 166
Assets pledged	866 336	926 098
Nominal amounts
Guarantees	53 669	50 696
Other	156	172
Contingent liabilities	53 825	50 868
Nominal amounts
Loans granted not paid2	204 812	259 683
Overdraft facilities granted but not utilised	64 172	66 492
Commitments	268 984	326 175

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.

2)During the fourth quarter 2021, a change has been made regarding which engagements are included in Loans granted not paid.

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. The timing of the completion of the investigations is still unknown and the outcome is still uncertain. At present, it is not possible to reliably estimate the amount of any potential settlement or fines, which could be material.

Note 20 Offsetting financial assets and liabilities

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 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.

Derivatives, reverse			Derivatives, repurchase
	repurchase agreements,		agreements,
	securities borrowing		securities lending
Group	31 Dec	31 Dec	31 Dec	31 Dec
SEKm	2021	2020	2021	2020
Financial assets and liabilities, which have been offset or are subject to
netting
Gross amount	272 413	224 363	238 400	207 455
Offset amount	-207 036	-133 010	-204 845	-135 137
Net amounts presented in the balance sheet	65 377	91 353	33 555	72 318
Related amounts not offset in the balance sheet
Financial instruments, netting arrangements	19 292	19 688	19 264	19 688
Financial Instruments, collateral	23 519	39 949	9 469	24 313
Cash collateral	13 850	15 278	4 801	15 551
Total amount not offset in the balance sheet	56 661	74 915	33 534	59 552
Net amount	8 716	16 438	21	12 766

The amount offset for derivative assets includes offset cash collateral of SEK 1 447m (3 934) derived from the balance sheet item Amounts owed to credit institutions. The amount offset for derivative liabilities includes offset cash collateral of SEK 2 249m (6 061), derived from the balance sheet item Loans to credit institutions. The amount offset for reverse repurchase agreements

includes offset security settlements liabilities of SEK 3 021m, which derive from the balance sheet item Other liabilities. The amount offset for repurchase agreements includes offset security settlement claims of SEK 28m, which derive from the balance sheet item's Other assets.

Note 21 Capital adequacy, consolidated situation

The 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 1423/2013 of the European Commission can be found on Swedbank's website: www.swedbank.com/investor-relations/reportsand-presentations/risk-reports

In the consolidated situation the Group's insurance companies are consolidated according to the equity method instead of full consolidation. The EnterCard Group is consolidated by proportional method instead of the equity method. Otherwise, same principles for consolidations are applied as for the Group.

	31 Dec	30 Sep	30 Jun	31 Mar	31 Dec
Consolidated situation, SEKm	2021	2021	2021	2021	2020
Available own funds
Common Equity Tier 1 (CET1) capital	129 644	129 867	127 551	124 725	120 496
Tier 1 capital	143 022	142 960	136 146	133 548	128 848
Total capital	158 552	158 682	151 840	149 711	144 737
Risk-weighted exposure amounts
Total risk exposure amount	707 753	703 220	688 517	694 625	689 594
Capital ratios as a percentage of risk-weighted exposure amount
Common Equity Tier 1 ratio	18.3	18.5	18.5	18.0	17.5
Tier 1 ratio	20.2	20.3	19.8	19.2	18.7
Total capital ratio	22.4	22.6	22.1	21.6	21.0
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	1.7	1.7	2.0	2.0	2.0
of which: to be made up of CET1 capital	1.2	1.2	1.4	1.4	1.4
of which: to be made up of Tier 1 capital	1.3	1.3	1.7	1.7	1.7
Total SREP own funds requirements	9.7	9.7	10.0	10.0	10.0
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	0.0	0.0	0.0	0.0	0.0
Systemic risk buffer	3.0	3.0	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	6.5	6.5	6.5	6.5	6.5
Overall capital requirements	16.2	16.2	16.5	16.5	16.5
CET1 available after meeting the total SREP own funds requirements	8.6	8.8	8.5	8.0	7.5
Leverage ratio
Total exposure measure	2 626 642	2 927 123	2 838 534	2 779 915	2 526 721
Leverage ratio, %	5.4	4.9	4.8	4.8	5.1
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	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	0.0	0.0
Leverage ratio buffer and overall leverage ratio requirement as a percentage of total exposure
measure	0.0	0.0	0.0	0.0	0.0
Leverage ratio buffer requirement Overall leverage ratio requirement	3.0	3.0	3.0	0.0	0.0
Liquidity Coverage Ratio
Total high-quality liquid assets, average weighted value	717 469	671 691	609 652	574 930	537 572
Cash outflows, total weighted value	528 742	489 426	453 480	433 130	413 139
Cash inflows, total weighted value	53 820	53 679	58 464	69 439	77 124
Total net cash outflows, adjusted value Liquidity coverage ratio, %	474 922 151.8	435 747 155.2	395 016 155.3	363 691 158.5	336 015 160.7
Net stable funding ratio
Total available stable funding	1 644 050	1 642 641	1 605 176	1 616 476	1 652 303
Total required stable funding	1 331 522	1 328 311	1 308 168	1 316 805	1 316 918
Net stable funding ratio, %	123.0	124.0	123.0	123.0	125.0

Common Equity Tier 1 capital	31 Dec	31 Dec
Consolidated situation, SEKm	2021	2020
Shareholders' equity according to the Group's balance sheet	161 670	155 168
Anticipated dividend	-12 632	-16 320
Deconsolidation of insurance companies	0	0
Value changes in own financial liabilities	-91	-77
Cash flow hedges	-2	2
Additional value adjustments	-1 037	-478
Goodwill	-13 590	-13 414
Deferred tax assets	-68	-78
Intangible assets	-4 427	-4 116
Insufficient coverage for non-performing exposures	-1	0
Deductions of CET1 capital due to Article 3 CRR	-137	-158
Shares deducted from CET1 capital	-41	-33
Total Common Equity Tier 1 capital	129 644	120 496

Risk exposure amount	31 Dec	31 Dec
Consolidated situation, SEKm	2021	2020
Risk exposure amount credit risks, standardised approach	51 273	48 309
Risk exposure amount credit risks, IRB	287 328	299 652
Risk exposure amount default fund contribution	281	556
Risk exposure amount settlement risks	2	0
Risk exposure amount market risks	20 306	17 314
Risk exposure amount credit value adjustment	2 338	4 398
Risk exposure amount operational risks	75 618	73 521
Additional risk exposure amount, Article 3 CRR	29 302	19 800
Additional risk exposure amount, Article 458 CRR	241 305	226 044
Total risk exposure amount	707 753	689 594

	SEKm		%
Capital requirements1	31 Dec	31 Dec	31 Dec	31 Dec
Consolidated situation, SEKm / %	2021	2020	2021	2020
Capital requirement Pillar 1	102 624	99 991	14.5	14.5
of which Buffer requirements2	46 004	44 824	6.5	6.5
Capital requirement Pillar 23	12 032	13 712	1.7	2.0
Pillar 2 guidance4	10 616	0	1.5	0.0
Total capital requirement including Pillar 2 guidance	125 272	113 703	17.7	16.5
Own funds	158 552	144 737

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 2021.

4) From Q3 2021 Swedbank consolidated situation is subject to Pillar 2 guidance.

	SEKm		%
Leverage ratio requirements1	31 Dec	31 Dec	31 Dec	31 Dec
Consolidated situation, SEKm / %	2021	2020	2021	2020
Leverage ratio requirement Pillar 1	7 879 926	0	3.0	0.0
Leverage ratio Pillar 2 guidance	1 181 989	0	0.5	0.0
Total leverage ratio requirement including Pillar 2 guidance	9 061 915	0	3.5	0.0

1) Swedbank's calculation based on the SFSA's announced leverage ratio requirements, including Pillar 2 requirements and Pillar 2 guidance.

Note 22 Internal capital requirement

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% 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 and risk-weighted assets. The purpose is to ensure efficient use of capital. The methodology serves as a basis of proactive risk and capital management.

As of 31 December 2021, the internal capital assessment for Swedbank's consolidated situation amounted to SEK 36.6bn (SEK 37.0bn as of 31 December 2020). The capital to meet the internal capital assessment, i.e. the Common Equity Tier 1, amounted to SEK 158.6bn (SEK 144.7bn as of 31 December 2020) (see Note 21). Swedbank's internal capital assessment using its own models is

Note 23 Risks and uncertainties

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. Covid-19 may continue to have consequences on Swedbank. Despite the overall positive economic forecasts in our home markets, uncertainty still remains in terms of impacts for many businesses in impacted sectors.

Anti-money laundering and Counter terrorist financing and other compliance risks

For risks related to the ongoing investigations in US related to historic AML compliance and response related to anti-money laundering controls, please refer to Note 19 Assets pledged, contingent liabilities and commitments.

In addition to the observations reported on money laundering and terrorist financing, Swedbank has previously identified elevated compliance risks within the bank related to internal governance as noted by supervisory authorities in their investigations of money laundering. In this regard, Swedbank assesses that the deficiencies identified by the supervisory authorities have been addressed by the bank, and to a large extent remediated. Swedbank has also identified elevated compliance risks in the customer protection area, and in the market surveillance area. Work is ongoing within the bank to address the deficiencies identified. Swedbank's Compliance function monitors this work.

Interest Rate Benchmark Reform

The Group's IBOR (Interbank Offered Rate) transition Programme continues to manage transition activities and operational changes necessary for the move from existing IBORs to alternative risk-free rates, also called the IBOR reform. Based on the nominal amounts, significant exposures in the Group's balance sheet that are

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 is SEK 25.3bn (SEK 25.7bn as of 31 December 2020) and the Common Equity Tier 1 capital amounted to SEK 126.1bn (SEK 118.1bn as of 31 December 2020) (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 3 framework are described in more detail in Swedbank's annual report for 2020 as well as in Swedbank's yearly Risk and Capital Adequacy Report, available on www.swedbank.se.

affected by the IBOR reform are linked to STIBOR (SEK), EURIBOR (EUR), USD LIBOR and NIBOR (NOK). USD LIBOR will cease after 30 June 2023 (with the exception of 1 week and two months tenors that ceased at 31 of December 2021), while the rest of these IBORs are expected to be available for the foreseeable future in reformed formats. Other exposures that are affected by the IBOR reform are linked to EONIA, CHF LIBOR, EUR LIBOR, GBP LIBOR and JPY LIBOR. These LIBOR rates ceased at the year-end 2021.

To manage the transition for the benchmark rates which ceased or are expected to cease, Swedbank adhered to the ISDA 2020 Benchmark Supplement Protocol for its derivative exposures. The Group's current bilateral derivative exposures where counterparties did not adhere to the ISDA 2020 Benchmark Supplement Protocol were insignificant both in number and exposure and the Group ensured voluntary transition to alternative risk-free rates ahead of the cessation dates or used the fallback option through bilateral agreement. In addition, Swedbank updated its bond issuance programs with proper fallback language for the benchmark rates that ceased or are expected to cease.

Tax

The tax area is complex and leaves room for judgement. 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 2020 Annual and sustainability report and in the disclosure in the Risk Management and Capital Adequacy reports available at www.swedbank.com.

Change in value if the market interest rate rises by one percentage point

Impact in SEKm on the net value of assets and liabilities, including derivatives, when market interest rates are increased by one percentage point.

31 December 2021	< 5 yrs	5-10 yrs	> 10 yrs	Total
SEK	-491	-1 020	221	-1 290
Foreign currency	757	191	85	1 033
Total	266	-829	306	-257
31 December 2020
SEK	1 190	-1 202	530	518
Foreign currency	1 355	-13	41	1 383
Total	2 545	-1 215	571	1 901

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.

31 December 2021	< 5 yrs	5-10 yrs	> 10 yrs	Total
SEK	361	-220	84	225
Foreign currency	-405	246	8	-151
Total	-44	26	92	74
31 December 2020
SEK	1 131	-1 047	484	568
Foreign currency	-369	341	-224	-252
Total	762	-706	260	316

Note 24 Related-party transactions

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.

Note 25 Swedbank's share

Number of outstanding ordinary shares	31 Dec 2021	31 Dec 2020
Issued shares SWED A	1 132 005 722	1 132 005 722
Repurchased shares SWED A	-10 570 929	-12 013 947
Number of outstanding ordinary shares on the closing day	1 121 434 793	1 119 991 775
SWED A
Last price, SEK	182.10	144.12
Market capitalisation, SEKm	204 213	161 413

Within Swedbank's share-based compensation programme, Swedbank AB has during 2021 transferred 1 443 018 shares at no cost to employees.

	Q4	Q3	Q4	Full-year	Full-year
Earnings per share	2021	2021	2020	2021	2020
Average number of shares
Average number of shares before dilution	1 121 434 587		1 121 430 775 1 119 991 775	1 121 117 329	1 119 720 567
Weighted average number of shares for potential ordinary shares that
incur a dilutive effect due to share-based compensation programme	3 716 547	3 494 846	3 934 735	3 676 236	3 708 306
Average number of shares after dilution	1 125 151 134		1 124 925 621 1 123 926 510	1 124 793 565	1 123 428 873
Profit, SEKm
Profit for the period attributable to shareholders of Swedbank	4 835	5 498	4 510	20 871	12 929
Earnings for the purpose of calculating earnings per share	4 835	5 498	4 510	20 871	12 929
Earnings per share, SEK
Earnings per share before dilution	4.31	4.90	4.03	18.62	11.55
Earnings per share after dilution	4.30	4.89	4.01	18.56	11.51

Swedbank AB

Income statement, condensed

Parent company SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Interest income on financial assets at amortised cost	2 407	2 458	2 807	9 872	12 727
Other interest income	1 530	1 176	1 301	5 363	5 865
Interest income	3 937	3 634	4 108	15 235	18 592
Interest expense	-478	6	-702	-962	-3 529
Net interest income	3 459	3 640	3 406	14 273	15 063
Dividends received	6 158	3 102	7 785	17 065	16 201
Commission income	2 331	2 150	2 077	8 660	7 779
Commission expense	-500	-526	-620	-2 119	-2 180
Net commission income	1 831	1 624	1 457	6 541	5 599
Net gains and losses on financial items	228	125	795	920	2 243
Other income	712	578	680	2 249	1 923
Total income	12 388	9 069	14 123	41 048	41 029
Staff costs	2 651	2 446	2 406	9 862	8 743
Other expenses	1 966	1 347	2 014	6 087	6 531
Depreciation/amortisation and impairment of tangible
and intangible fixed assets	1 238	1 234	1 208	4 956	4 820
Administrative fine	0	0	0	0	4 000
Total expenses	5 855	5 027	5 628	20 905	24 094
Profit before impairment	6 533	4 042	8 495	20 143	16 935
Impairment of financial assets	0	0	-16	0	-16
Credit impairment, net	-45	42	565	78	4 068
Operating profit	6 578	4 000	7 946	20 065	12 883
Appropriations	-53	0	-42	-53	-42
Tax expense	1 418	873	1 337	4 031	3 089
Profit for the period	5 213	3 127	6 651	16 087	9 836

Statement of comprehensive income, condensed

Parent company SEKm	Q4 2021	Q3 2021	Q4 2020	Full-year 2021	Full-year 2020
Profit for the period reported via income statement	5 213	3 127	6 651	16 087	9 836
Total comprehensive income for the period	5 213	3 127	6 651	16 087	9 836

Balance sheet, condensed

Parent company SEKm	31 Dec 2021	31 Dec 2020
Assets
Cash and balance with central banks	194 353	167 121
Loans to credit institutions	650 948	669 495
Loans to the public	391 675	428 997
Interest-bearing securities	214 197	192 488
Shares and participating interests	78 924	82 321
Derivatives	44 323	59 644
Other assets	43 076	48 538
Total assets	1 617 496	1 648 604
Liabilities and equity
Amounts owed to credit institutions	100 610	246 804
Deposits and borrowings from the public	942 932	869 222
Debt securities in issue	296 918	259 922
Derivatives	42 542	74 236
Other liabilities and provisions	54 007	50 512
Senior non-preferred liabilities	37 832	10 359
Subordinated liabilities	28 604	23 434
Untaxed reserves	10 630	10 682
Equity	103 421	103 433
Total liabilities and equity	1 617 496	1 648 604
Pledged collateral	55 407	110 092
Other assets pledged	8 529	7 149
Contingent liabilities	232 276	315 206
Commitments	263 331	324 052

Statement of changes in equity, condensed

Parent company

SEKm

	Share capital	Share premium reserve	Statutory reserve	Retained earnings	Total
January-December 2021
Opening balance 1 January 2021	24 904	13 206	5 968	59 355	103 433
Dividend	0	0	0	-16 310	-16 310
Share based payments to employees Deferred tax related to share based payments to	0	0	0	195	195
employees	0	0	0	18	18
Current tax related to share based payments to
employees	0	0	0	-2	-2
Total comprehensive income for the period	0	0	0	16 087	16 087
Closing balance 31 December 2021	24 904	13 206	5 968	59 343	103 421
January-December 2020
Opening balance 1 January 2020	24 904	13 206	5 968	49 340	93 418
Share based payments to employees	0	0	0	178	178
Deferred tax related to share based payments to
employees	0	0	0	7	7
Current tax related to share based payments to
employees	0	0	0	-6	-6
Total comprehensive income for the period	0	0	0	9 836	9 836
Closing balance 31 December 2020	24 904	13 206	5 968	59 355	103 433

Cash flow statement, condensed

Parent company SEKm	Full-year 2021	Full-year 2020
Cash flow from operating activities	2 849	58 388
Cash flow from investing activities	9 480	9 112
Cash flow from financing activities	14 903	-7 975
Cash flow for the period	27 232	59 525
Cash and cash equivalents at beginning of period	167 121	107 596
Cash flow for the period	27 232	59 525
Cash and cash equivalents at end of period	194 353	167 121

Capital adequacy

	31 Dec	30 Sep	30 Jun	31 Mar	31 Dec
Parent company, SEKm	2021	2021	2021	2021	2020
Available own funds
Common equity tier 1 (CET1) capital	96 715	96 708	96 366	95 020	93 880
Tier 1 capital	110 093	109 802	104 962	103 843	102 232
Total capital	126 056	125 742	120 808	119 845	118 091
Risk-weighted exposure amounts
Total risk exposure amount	353 415	355 318	349 604	360 259	358 278
Capital ratios as a percentage of risk-weighted exposure amount
Common equity tier 1 ratio	27.4	27.2	27.6	26.4	26.2
Tier 1 ratio	31.2	30.9	30.0	28.8	28.5
Total capital ratio	35.7	35.4	34.6	33.3	33.0
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	1.5	1.5	2.2	2.2	2.2
of which: to be made up of CET1 capital	1.1	1.1	1.4	1.4	1.4
of which: to be made up of Tier 1 capital	1.2	1.2	1.8	1.8	1.8
Total SREP own funds requirements	9.5	9.5	10.2	10.2	10.2
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	0.1	0.1	0.1	0.1	0.1
Systemic risk buffer	0.0	0.0	0.0	0.0	0.0
Global Systemically Important Institution buffer	0.0	0.0	0.0	0.0	0.0
Other Systemically Important Institution buffer	0.0	0.0	0.0	0.0	0.0
Combined buffer requirement	2.6	2.6	2.6	2.6	2.6
Overall capital requirements	12.1	12.1	12.8	12.8	12.8
CET1 available after meeting the total SREP own funds requirements	17.9	17.7	17.4	16.2	16.0
Leverage ratio
Total exposure measure	1 209 752	1 555 142	1 486 600	1 454 485	1 263 146
Leverage ratio, %	9.1	7.1	7.1	7.1	8.1
Additional own funds requirements to address the risk of excessive leverage as a percentage of
total exposure measure	0.0	0.0	0.0	0.0	0.0
Additional own funds requirements to address the risk of excessive leverage 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	0.0	0.0
Leverage ratio buffer and overall leverage ratio requirement as a percentage of total exposure
measure
Leverage ratio buffer requirement	0.0	0.0	0.0	0.0	0.0
Overall leverage ratio requirement	3.0	3.0	3.0	0.0	0.0
Liquidity coverage ratio
Total high-quality liquid assets, average weighted value	569 030	528 923	474 877	445 488	420 572
Cash outflows, total weighted value	555 590	534 009	507 401	490 377	471 021
Cash inflows, total weighted value	62 120	75 333	93 156	111 442	109 926
Total net cash outflows, adjusted value	493 470	458 676	414 245	378 935	361 095
Liquidity coverage ratio, %	115.6	115.6	115.1	117.6	116.7
Net stable funding ratio
Total available stable funding	965 167	960 113	935 457	E/T	E/T
Total required stable funding	534 747	545 985	549 105	E/T	E/T
Net stable funding ratio, %	180.5	175.5	170.4	E/T	E/T

Risk exposure amount	31 Dec	31 Dec
Parent company, SEKm	2021	2020
Risk exposure amount credit risks, standardised approach	86 177	85 062
Risk exposure amount credit risks, IRB	167 375	189 909
Risk exposure amount default fund contribution	281	556
Risk exposure amount settlement risks	2	0
Risk exposure amount market risks	20 987	17 004
Risk exposure amount credit value adjustment	2 333	4 362
Risk exposure amount operational risks	40 218	39 068
Additional risk exposure amount, Article 3 CRR	26 458	17 658
Additional risk exposure amount, Article 458 CRR	9 584	4 659
Total risk exposure amount	353 415	358 278

	SEKm		%
Capital requirements1	31 Dec	31 Dec	31 Dec	31 Dec
Parent company, SEKm / %	2021	2020	2021	2020
Capital requirement Pillar 1	37 462	37 977	10.6	10.6
of which Buffer requirements2	9 189	9 315	2.6	2.6
Capital requirement Pillar 23	5 301	8 035	1.5	2.2
Total capital requirement including Pillar 2 guidance	42 763	46 012	12.1	12.8
Own funds	126 056	118 091

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 2021.

	SEKm		%
Leverage ratio requirements1	31 Dec	31 Dec	31 Dec	31 Dec
Parent company, SEKm / %	2021	2020	2021	2020
Leverage ratio requirement Pillar 1	3 629 256	0	3.0	0.0
Total leverage ratio requirement including Pillar 2 guidance	3 629 256	0	3.0	0.0

1) Swedbank's calculation based on the SFSA's announced leverage ratio requirements, including Pillar 2 requirements and Pillar 2 guidance.

Alternative performance measures

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 figures 1), 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 figures 1), 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 measures excluding expenses for the administrative fine
Amount related to expenses is presented excluding expenses for administrative fine. 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 fine
Represents profit for the period (annualised) attributable to shareholders excluding expenses for the administrative fine in relation to average Equity attributable to shareholders' of the parent company. The average is calculated 1) using month-end figures , including the prior year end. Profit for the period attributable to shareholders excluding expenses for administrative fine 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 fine
Total expenses excluding expenses related to administrative fine in relation to total income. Total expenses excluding expense for administrative fine is	Provides comparability of figures between reporting periods.

reconciled to Total expenses, the nearest IFRS measure, on page 6.

Other alternative performance measures

These measures are defined in Fact book on page 78 and are calculated from the financial statements without adjustment.

• Share of Stage 1 loans, gross
• Share of Stage 2 loans, gross
• Share of Stage 3 loans, gross
• Cost/Income ratio
• Equity per share
• Credit Impairment ratio
• Credit impairment provision ratio Stage 1 loans
• Credit impairment provision ratio Stage 2 loans
• Credit impairment provision ratio Stage 3 loans
• Return on equity 1)
• Total credit impairment provision ratio
• Loan/Deposit ratio

1) The month-end figures used in the calculation of the average can be found on page 71 of the Fact book.

Used by Group management for internal governance and operating segment performance management purposes.

Signatures of the Board of Directors and the President

The Board of Directors and the President hereby certify that the Year-end report for 2021 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, 1 February 2022

Göran Persson Chair

Bo Bengtsson	Göran Bengtsson	Annika Creutzer	Hans Eckerström
Board Member	Board Member	Board Member	Board Member
Kerstin Hermansson	Bengt Erik Lindgren	Bo Magnusson	Anna Mossberg
Board Member	Board Member	Board Member	Board Member
	Per Olof Nyman Board Member	Biljana Pehrsson Board Member
	Roger Ljung Board Member Employee Representative	Åke Skoglund Board Member Employee Representative

Jens Henriksson President and CEO

Review report

Introduction

We have reviewed the Year-end report for Swedbank AB (publ) for the period 1 January - 31 December 2021. The Board of Directors and the CEO are responsible for the preparation and presentation of this Year-end report 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.

Scope of 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.

Conclusion

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, 2 February 2021

PricewaterhouseCoopers AB

Anneli Granqvist Martin By Authorised Public Accountant Authorised Public Accountant Auditor in charge

Publication of financial information

The Group's financial reports can be found on www.swedbank.com/ir

Financial calendar 2022

Annual and sustainability report 2021	23 February 2022
Annual General Meeting	30 March 2022
Interim report for the first quarter 2022	28 April 2022
Interim report for the second quarter 2022	19 July 2022
Interim report for the third quarter 2022	27 October 2022

For further information, please contact:

Jens Henriksson President and CEO Telephone +46 8 585 934 82 Anders Karlsson CFO Telephone +46 8 585 938 75 Annie Ho Head of Investor Relations Telephone +46 70 343 7815

Erik Ljungberg Head of Group Communications and Sustainability Telephone 08 +46 73-988 35 57 Unni Jerndal Press Officer 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 Landsvägen 40 SE-105 34 Stockholm, Sweden Telephone +46 8 585 900 00 www.swedbank.com info@swedbank.se