Handelsbanken's interim report January - September 2001
Profits increased
Profits were SEK 8 556m (8 530), an increase of SEK 26m. During the second quarter of last year, the Bank sold its holding in Svensk Exportkredit which had a positive one-off impact on the result, amounting to SEK 343m. All comparisons with last year exclude this one-off effect. Return on shareholders' equity was 19.1% (21.6). For the full-year 2000, return on shareholders' equity was 21.6%. The cost/income ratio before loan losses was 46.9% (44.7) and 46.6% (43.9) after loan losses. Earnings per share were SEK 9.18 (9.19) and as a 12-month moving total SEK 12.43 (12.19) per share.
Comparable expenses rose by 4%
Total expenses increased by 10% to SEK 7 504m (6 796). Expenses for comparable parts of the Group, i.e. excluding Midtbank, SPP and exchange rate fluctuations, went up by 4%. This increase is mainly due to the expansion in the Nordic countries and the UK, and also higher IT costs. The average number of employees in the Group rose by 609, of whom 225 come from Midtbank.
Continued recoveries
Recoveries, including the change in value of repossessed property, exceeded loan losses and the net figure was SEK 51m (109). The proportion of bad debts amounted to 0.27% (0.24) of lending. The volume of collateral taken over was SEK 223m (141).
Capital ratio, buyback of shares and rating
The Group's capital ratio was 9.5% (9.8). The Tier 1 capital ratio was 5.9% (6.6).
These ratios include profits for the period. This report has not been examined by the external auditors. According to Finansinspektionen's regulations, profits for the period cannot be included in the capital ratio figure. Excluding profits for the period, the Group's capital ratio was 9.4% (9.5) and the Tier 1 ratio was 5.7% (6.4).
At the Annual General Meeting in 2001, the board of the Bank was authorised to repurchase up to 20 million shares during the year until the next AGM and, if considered appropriate, to sell shares which had already been repurchased for the purpose of financing possible acquisitions. Handelsbanken has not repurchased any shares since the 2001 meeting, but has sold 5.5 million shares in connection with the acquisition of Midtbank. The number of outstanding shares is 693.4 million.
Handelsbanken's rating from all three rating agencies was unchanged.
This year's customer satisfaction survey by Svenskt Kvalitetsindex - Handelsbanken at the top
One of Handelsbanken's corporate goals is to have higher profitability than the average for the other Nordic banks. One means of achieving this goal is to have the most satisfied customers in the banking sector. This is one reason why Handelsbanken has supported the development of independent surveys of customer satisfaction in Sweden and now in all the Nordic countries. In mid-October, Svenskt KvalitetsIndex (SKI) published its 2001 customer satisfaction survey for Sweden.
Handelsbanken was at the top for both corporate and private customers. In the private market, Handelsbanken had the same customer satisfaction index as the previous year, while the index for the three other major Swedish banks was lower in 2001 than 2000. Handelsbanken's customer satisfaction index in the corporate sector increased while the other major banks had an unchanged or lower index.
Handelsbanken authorised to start banking operations in Poland
At the beginning of October, Bank Svenska Handelsbanken (Polska) S.A. received permission to conduct banking operations. The normal way for foreign banks to start up in the Polish banking market has been to acquire all or parts of a Polish bank. Handelsbanken is the first foreign bank to start a wholly-owned subsidiary bank in Poland. By starting the bank from scratch, it will be possible to give a Nordic character to the operations. The goal is to provide service for Nordic companies and the bank has staff who speak Nordic languages and Polish. The Polish subsidiary bank has share capital of PLN 200m, equivalent to some SEK 500m.
e-bud(TM) - almost half a million visitors and more than 10 000 bids made
www.e-bud.nu - Stadshypotek's service to estate agents for bidding on the Internet - has had almost half a million visitors since it started at the end of 2000. This service gives both buyers and sellers, and other interested parties, the opportunity to see in realtime the progress of bidding for properties registered on the site. The bidding process is administered by the estate agent, who with the help of e-bud(TM) can use his time more efficiently.
More than 400 estate agents have joined e-bud. The number of properties on offer via e-bud is continually increasing and so far 2 700 properties have been subject to over 10 000 bids. Estate agents are linked up in more than half of Sweden's municipalities, although e-bud has mainly been used in the Greater Stockholm area, Uppsala and Göteborg.
Stockholm, 23 October 2001
Lars O Grönstedt
President and Group Chief Executive
The full interim report including tables can be downloaded from the following link:
For further information please contact: <br> <br>Lars O Grönstedt, Group Chief Executive tel: +46 8 22 92 20 <br> e-mail lagr03@handelsbanken.se <br> <br>Lennart Francke, Head of Accounting and Control tel: +46 8 22 92 20 <br> e-mail lefr01@handelsbanken.se <br> <br>Lars Lindmark, Head of Corporate Communications tel: +46 8 701 10 36 <br> e-mail lali12@handelsbanken.se <br> <br>Bengt Ragnå, Head of Investor Relations tel: +46 8 701 12 16 <br> e-mail bera02@handelsbanken.se <br> <br> <br>Highlights of the annual report for 2001 will be published on 12 February 2002. <br>Handelsbanken's interim reports and other publications are also available on the Internet (http://www.handelsbanken.se/ireng). <br> <br> <br> <br> <br> <br>Business volumes continue to increase - net interest income up 12% <br>Net interest income rose by 12% to SEK 9 856m (8 781). This was mainly because the average volume of lending to the general public increased by 15%. The rate of increase in lending slowed down in the third quarter. Total lending to the general public was SEK 785bn (667). Net trading income increased by 1% to SEK 1 994m (1 968). Most net trading income originates from foreign exchange and money market trading and just under 20% from equity-related trading. Net commission income fell by 11% to SEK 3 729m (4 167). Brokerage and mutual fund commission fell by 27% while other types of commission rose, particularly lending and payment commission. Overall, total income rose by 5%. <br> <br>