BEST YEAR IN HQ’s HISTORY

• OPERATING INCOME SEK 986 (931) MILLION + 6%
• OPERATING PROFIT SEK 405 (350) MILLION + 16%
• OPERATING PROFIT EXCL TRADING SEK 420 (276) MILLION + 52%
• PROFIT AFTER TAX SEK 290 (250) MILLION + 16%
• EARNINGS PER SHARE AFTER DILUTION SEK 10.5 (9.2) + 14%
• OPERATING MARGIN 41 (38)%
• ASSETS UNDER MANAGEMENT SEK 79.2 (77.6) BILLION, NET INFLOW SEK 8.3 (8.4) BILLION
• PROPOSED DIVIDEND SEK 10.00 (6.00) PER SHARE

COMMENTS FROM CEO MIKAEL KÖNIG
Despite the unfavourable market climate during the second half of the year HQ Bank is reporting its best year-end ever. Income increased by 6 percent and operating earnings by 16 percent, which demonstrates the scalability and stability of our business model. Adjusted for the Trading business, operating earnings increased by a substantial 52 percent. With the exception of Trading, all services areas are demonstrating strong growth. For example, Corporate Finance is reporting doubled operating earnings compared to 2006. This development is explained by continuous focus on delivering added value and repeat income, as well as by talented personnel and cost awareness.

It was naturally gratifying to be voted ”Sweden’s best private bank” in January 2008 by the prestigious magazine Euromoney. Our ambition is naturally to continue with our proven successful strategy and to maintain this lead.

During 2008 we will expand the business in Alternative Investments, which is an area with great potential, and we will transform this into a natural component of Private Banking’s product offering. One crucial factor in our success is our distribution power. Unique and attractive products open up opportunities for significant distribution via external channels. Furthermore work is ongoing to dismantle Trading in its current form. This means lower risk and further clarifies the business model.