Swedish Lenders Defy Gloomy Economy

Wednesday, 18 Jul 2012 | 6:08 AM ET

The euro zone debt crisis which has plagued the global economy negatively impacting even those outside of the bloc has ensured relatively subdued expectations for the start of the corporate earnings season.

Ellen Rooney | Getty Images

Despite the gloomy macroeconomic picture, Michael Wolf, CEO at Swedbank remained upbeat about the prospects for the Swedish economy and insisted its banks were “performing extremely strongly”.

“Sweden looks very robust in the context of the European debt crisis and Swedish banks in general are having good access to the funding markets. The effects of the debt crisis in the real economy are starting to show here but we are still moving ahead," he said.

The bank reported earnings for the second quarter which slightly beat forecasts, and said that it was in good shape for the rest of the year and well insulated from a worsening real economic environment.

Swedbank to Focus on Costs as Results Beat Forecasts
Michael Wolf, CEO, Swedbank, told CNBC, "What we are saying is the effects of the debt crisis on the real economy are starting to show here but in light of that we are still moving ahead and we are able to re-price and become more efficient. I am quite happy with the PNL so far and our ability to be masters of our own destiny."

Swedbank shares opened lower Wednesday.

The Swedish economy, which is outside the euro zone, has been hit by the global economic slowdown and its proximity to the region. The Organisation for Economic Co-Operation and Development said economic growth in 2012 would be modest in its May economic report.

Sweden’s Nordea, the largest financial services group in the Nordic region, also reported strong numbers for the second quarter. Christian Clausen, CEO at Nordea said the numbers showed just how strong the quarter was with revenue and profits both higher.

Nordea CEO: We're Adjusting Business Model to 'New Normal'
Christian Clausen, CEO of Nordea, told CNBC, "We are adjusting our whole business model to the new normal and the new normal is low growth, very low interest rates and all these new requirements on banks and regulation. The fundamental thing right now is to make sure we run the bank more efficiently."

“In this environment we are pleased to grow. Profits are up nearly 10 percent in the first half of the year against the same time last year. We are adjusting our whole business model to the new ‘normal’, which is lower growth, very low interest rates,” Clausen said.

He added the key issue was to run the bank more efficiently. Nordea shares were higher in early trade on Wednesday.


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