STABLE FINANCES AND STRONG NET INFLOW

January-December

• OPERATING REVENUE SEK 818 (986) MILLION -17 %
• OPERATING PROFIT SEK 278 (405) MILLION -31 %
• PROFIT AFTER TAX SEK 246 (290) MILLION -15 %
• EARNINGS PER SHARE AFTER DILUTION SEK 9.0 (10.5) -14 %
• OPERATING MARGIN 34 (41) PERCENT
• ASSETS UNDER MANAGEMENT SEK 54.3 (79.2) BILLION, NET INFLOW SEK 5.0 (8.3) BILLION
• PROPOSED DIVIDEND SEK 6.00 (10.00) PER SHARE

COMMENTS FROM CEO MIKAEL KÖNIG

Despite a year with exceptional market conditions it is pleasing that HQ is able to report an operating profit of SEK 278 million. The operating margin amounted to 28 percent for the underlying operations, despite negative earnings for our Trading operations. Capital adequacy was 15 percent, which is higher than our financial target. This is once again evidence of our financial and operational stability, which also provides a high level of financial preparedness.

The net inflow of new volumes amounted during the year to SEK 5.0 billion, partly as a consequence of successful ventures in Private Banking outside the Stockholm region. During the year we have also strengthened our offering in Investment Banking through continued efforts in Alternative Investments and through the acquisition of the Swedish operations of Glitnir. This latter has led to an expanded value proposition and a wider client base in Sweden and abroad.

Although it is difficult to estimate the short-term impact of the financial meltdown, and its effects on the real economy, we will continue to utilise the strength of our business model and work in the long term to further strengthen our positions. The competitive environment has changed markedly in recent quarters, which provides us with good opportunities to increasingly take new market share.

Going forward HQ will focus on three areas – Asset Management, Investment Banking and Private Banking – with the vision of creating and revealing leading Nordic business in each area. HQ Fonder will form the basis of our new area of focus – Asset Management – and using the existing business we will broaden our expertise and services offering and address new client segments.