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Profits soar for Sweden's Nordea in Q3

Wednesday, 24 Oct 2012 | 4:51 AM ET

STOCKHOLM -- Nordea AB, the largest banking group in the Nordics, has posted a near 70 percent increase in third-quarter profits mainly thanks to higher household lending and a tighter rein on costs, but said loan losses keep growing, especially within shipping and the Danish housing market.

Wednesday's report showed a net profit of (EURO)686 million ($892 million), up from (EURO)404 million in the same quarter last year.

Net interest income, the bank's main source of income, grew to (EURO)1.44 billion from (EURO)1.38 billion, while loan losses more than doubled to (EURO)254 million from (EURO)112 million.

Nordea CEO Christian Clausen says that reflects effects the current macro situation is having on shipping.

The result disappointed market watchers and the share plunged almost 4 percent to 59.45 kronor ($9.05) in Stockholm trading.