SEK’s Year-end Report 2021: Increased client activity in the fourth quarter
Client activity increased in the fourth quarter and SEK reached a new lending volume of Skr 26.6 billion (4Q20:Skr 18.6 billion). Demand for financing has been positively impacted by a favorable economic trend, generally higher acquisition activity, and strong demand for export and project credits. The company‘s new lending in 2021 totaled Skr 77.0 billion, down compared with the preceding year’s record of Skr 125.5 billion. SEK is still satisfied with the years, given the previous year’s very high volume of new lending.
SEK has noted increased demand for financing major transition projects in Sweden and internationally, particularly within energy, infrastructure, hospitals and water treatment.
“SEK’s financing of international projects is creating new business and export opportunities for Swedish companies. Global demand for sustainable solutions is extensive which provides healthy prerequisites for Sweden as a world leader in innovative and climate-smart solutions,” says Magnus Montan, CEO of the Swedish Export Credit Corporation.
In the fourth quarter, SEK closed its first transaction within the framework of social loans, an export credit of EUR 186 million, with SEK financing the renovation and new build of two specialist hospitals in Ghana. Several Swedish companies are supplying products and expertise for the project. The hospitals will provide high-quality specialist care that will improve the lives of a great number of people in the region.
“Conducting business in developing countries with complex environments can be challenging, but SEK is working intensely to support projects in the region,” says Magnus Montan.
In the fourth quarter, net interest income increased compared with the preceding quarter. Client activity increased and new lending amounted to Skr 26.6 billion compared with Skr 12.3 billion in the preceding quarter. Return on equity amounted to 4.6 percent, a decline compared with the preceding quarter, which was the result of higher costs for adapting to regulations and higher provisions for expected credit losses compared with the third quarter.
For the full-year, SEK reached a new lending volume of Skr 77.0 billion, down from the preceding year’s record new lending of Skr 125.5 billion. The pandemic has exemplified one of SEK’s most important assignments: to act as a tool for the government by providing the Swedish export industry with financing during turbulent periods in the market. Since provisions for expected credit losses are lower than the preceding year, we recorded a higher net profit for the full year.
“We have been able to support our clients increased financing requirements during the entire time that the pandemic has been with us, at the same time as we have maintained a strong financial position. SEK’s capitalization exceeds the requirements of the Finansinspektionen (the Swedish FSA) as well as the company’s capital target, and we have continued to maintain high liquidity,” says Magnus Montan, CEO of the Swedish Export Credit Corporation.
Results January–December 2021 (compared with January–December 2020)
• New lending Skr 77.0 billion (2020: Skr 125.5 billion)
• Net interest income Skr 1,907 million (2020: Skr 1,946 million)
• Operating profit Skr 1,305 million (2020: Skr 1,238 million)
• Net profit Skr 1,034 million (2020: Skr 968 million)
• Volume of green bonds issued Skr 6.1 billion (2020: Skr 5.1 billion)
• After-tax return on equity was 5.1 percent (2020: 4.9 percent)
• The total capital ratio amounted to 21.6 percent (year-end 2020: 21.8 percent)
• Basic and diluted earnings per share Skr 259 (2020: Skr 243)
Press contact
Catharina Henriksson
+46 76-677 59 09
catharina.henriksson@sek.se
About SEK
The Swedish Export Credit Corporation (SEK) is a state-owned company that finances Swedish exporters, their suppliers, and international buyers of Swedish products and services. Sustainability is central to SEK's operations, and therefore it is a natural step to finance the industry's transition to a fossil-free society; a development that also creates new export opportunities. With lending in 60 countries, SEK has substantial knowledge of international transactions and is a natural business partner in export financing.
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