Swedbank Q1 net profit beats forecast

CNBC.com with Reuters
Key Points
  • EPS: 4.59 SEK ($0.51), versus 4.08 expected by Reuters analysts.
  • Revenue: 10.65 billion, versus 10.54 billion anticipated by Reuters analysts.
  • Net profit: 5.12 billion, versus 4.95 billion expected by a Reuters poll of analysts.
Swedish economy is doing well, subdued demand for corporate lending: Swedbank CEO

Swedish banking group reported first-quarter net earnings above market expectations on Tuesday as macroeconomic conditions continued to improve both at home and abroad.

"Growth is broad-based in our home markets with a positive outlook," Swedbank CEO Birgitte Bonnesen, said in the report. "Domestic spending is strong and exports are increasing in the wake of more robust global economic conditions."

Net profit rose to 5.12 billion Swedish crowns ($578 million), above a mean forecast for 4.95 billion in a Reuters poll of analysts and compared with 4.31 billion in the year-ago period.

The domestic housing market, however, remains a "big challenge" for Sweden, Bonnesen said, speaking to CNBC Tuesday.

Despite negative interest rates, the country's housing market has seen slowing demand over recent months and Bonnesen called on policymakers for "political initiative and strengthened action" to boost demand in what she described as Sweden's otherwise fundamentally strong market.

Sweden's financial watchdog said earlier this month that tighter mortgage rules introduced last year have helped to cool the housing market, which has long been seen as under threat of a crash following continued price growth since the late 1990s.

Last year, the country made it mandatory for most new borrowers to pay down the principal on mortgage loans.