Struggling back from heavy losses last year on loans in the Baltic, Swedbank is posting profits again.
Swedbank returns to surprise profit.
Surprising financial experts, Swedbank posted a first-quarter profit of SEK 536 million ($74.2 million) from a loss of SEK 3.36 billion ($470 million) a year earlier. Analysts had been expecting that Sweden’s fourth biggest bank would post a net loss of around SEK 1.1 billion ($150 million) in the latest quarter. Easing of bad loan provisions for loan losses in the Baltic countries was attributed for the bulk of profits. With 2.1 billion ($290 million) coming from Baltic Banking, net credit impairments fell by more than half from the preceding quarter to SEK 2.21 billion ($310 million). The bank's statement said that impaired loans and loans overdue for more than 60 days in the Baltic countries had come to a standstill. Most important, at the bank's home and headquarters, the Swedish credit quality remained good. “We have posted a profit for the first time since the end of 2008. We can now clearly see the effect of the work we began a year ago. A lower risk level in the bank and a stronger organization for problem loans, together with improved macroeconomic conditions, led to a significant decline in credit impairments during the first quarter,” said Michael Wolf, CEO of Swedbank.
"We can now clearly see the effect of the work we began a year ago," says Michael Wolf, CEO of Swedbank.