STOCKHOLM - Swedbank and SEB, two giant presences on the Baltic financial sector have both announced what seem to be healthy half-year figures, undercut by growing problems in their Baltic operations.
SEB's operating result for the second quarter of 2008 amounted to SEK 3,507m, up by 46 per cent compared with the previous quarter but 23 per cent below the second quarter of last year. Operating income at SEK 10,403m was 18 per cent higher than the previous quarter and 3 per cent lower than the same period last year. Net credit losses of SEK 452m were blamed on "the higher credit loss level in Estonia."
SEB's operating results for the first six months of 2008 amounted to SEK 5,917m.
SEB's President and Group Chief Executive Officer Annika Falkengren said: "It is satisfying to note that we in a quarter marked by renewed financial turbulence can present an income level just second to our all-time high. Our strong capital base and liquidity position provide continued opportunities to long-term grow our business and thus to be offensive in overall defensive markets."
Over at rivals Swedbank, profit for the period rose by 8 percent compared with the first half year of 2007 to SEK 6,504m. However Swedbank also saw a marked increase in loan losses which totalled SEK 711m (up from SEK 151m). That corresponds to a loan loss ratio rise from just 0.03 percent to 0.12 percent.
Swedbank CEO Jan Liden said: "Swedbank's stable earning capacity led to solid results in all business areas for the first half of 2008. The profit of SEK 6.5bn for the first six months is our highest ever. In light of current market conditions, Swedbank's stable earning capacity is a huge asset.
"The Baltic region's macroeconomic development was weaker than expected duringthe second quarter, partly as an effect of economic uncertainty in the rest ofEurope. While this will affect Baltic Banking's development, the business areais expected to maintain a robust earning capacity and net profit. Credit qualityremains high in both the Baltic region and Sweden."
