×

Swedbank Q1 net profit beats forecast

Swedish banking group Swedbank reported first-quarter net earnings above market expectations on Tuesday as increased mortgage volumes and higher margins compensated for a challenging interest rate environment.

Net profit fell marginally to 4.31 billion Swedish crowns ($529 million), above a mean forecast for 4.05 billion in a Reuters poll of analysts and compared with 4.32 billion in the year-ago period.

Acting CEO Birgitte Bonnesen, who stepped in to replace Michael Wolf after he was suddenly removed in February from heading the bank, told CNBC Tuesday that negative interest rates had put "pressure on our NII (net interest income) but of course we mitigated it by increasing our loan volumes on the mortgage side so I think we came out really strongly on the NII line for Sweden."

Without addressing the specific allegations against Wolf, who was recently cleared of any charges, Bonnesen acknowledged that "there was so much turbulence in a short time," but despite this, the bank had managed to deliver a "stellar result" and was now looking to the future.

"We're becoming increasingly operational and concrete and focusing on the bank that we want to be for our customers," Bonnesen told CNBC.

Bonnesen added that despite the challenges arising from the high capital levels set by Sweden's Riksbank, Swedbank has "an ambition of being ahead of the curve and this is what you see … we're well prepared and that's been very important for us."