SEK Interim Report 1 2015

Lower new lending – but higher volume of outstanding offers

During the first quarter of 2015, the demand for long-term financing from SEK was relatively low, but we have a higher volume of outstanding offers. Our new lending to Swedish exporters and their customers during the first quarter amounted to Skr 10.8 billion (1Q14: Skr 18.6 billion). End customer financing amounted to Skr 8.2 billion (1Q14: Skr 11.7 billion) and the aggregate volume of corporate lending amounted to Skr 2.6 billion (1Q14: Skr 6.9 billion). The aggregate amount of outstanding offers at the end of the period was Skr 95.6 billion (year-end 2014: 78.4 billion).

-          This is a fairly good reflection of the market for Swedish exporters. Access to financing is good, while the high volume of offers may indicate an improvement for Swedish exports, says SEK´s CEO Mrs Catrin Fransson.

SEK has historically provided lending to the 100 largest Swedish exporting companies. To broaden the base we have since 1st of January 2015, started a work based on our complementary role in the market to reach out to medium-sized businesses. We have focused in particular on those companies that have a turnover of between approximately Skr 500 million and Skr four billion.

-          In our efforts, we have a close cooperation with Swedish banks at both regional and local level and EKN, which is a key to success, says SEK’s CEO Mrs Catrin Fransson.

Today, April 28, 2015, at the SEK’s Annual General Meeting, SEK´s owner (the Swedish State) approved the revision of SEK´s financial targets and mission objectives for SEK. The financial targets consist of a capital structure target expressed as a Common Equity Tier 1 capital ratio (16%), a profitability target expressed as return on equity (6%) and a dividend target expressed as a percentage of net profit for the year (30%). In addition to targets, all state-owned companies with social mission that aim to generate some kind of social benefit also have mission objectives. SEK’s social mission is to administer the CIRR system in order to support the Swedish export industry. SEK will monitor the achievement of this objective through client surveys and through dialogue with our stakeholders.

The owner instruction for SEK has also been revised. The revised ownership instructions are clearer and more general and at the same time more dynamic, which makes it easier for the company to develop the business in line with market and customer needs change. The owner has also made a sustainability analysis, which among others suggested that the company should implement further international guidelines and clarify the objective of SEK's efforts to contribute to sustainable development.

-          The new targets in combination with the revised owner instruction are both challenging and exciting. This will provide us with a clear framework to further develop our business and create benefits for more customers in cooperation with other state export promotion institutions and commercial banks, says SEK´s CEO Mrs Catrin Fransson.

January-March 2015

• New lending amounted to Skr 10.8 billion (1Q14: Skr 18.6 billion)
• Net interest revenues amounted to Skr 419 million (1Q14: Skr 352 million)
• Operating profit amounted to Skr 343 million (1Q14: Skr 518 million)
• Net profit amounted to Skr 262 million (1Q14: Skr 402 million)
• Return on equity amounted to 6.4 percent (1Q14: 10.6 percent)
• The outstanding volume of offers for loans at the end of the period amounted to Skr 95.6 billion (Skr 78.4 billion at year-end 2013)
• The Common Equity Tier 1 capital ratio was 17.8 percent at the end of the period according to CRR (16.9 percent at year-end 2014 according to Basel II)