Länsförsäkringar Bank: January – June 2020

”The corona pandemic had a major impact on the global economy and the situation was challenging for many, both companies and private individuals alike. We can, however, note that the situation now seems a little brighter and the economic downturn does not appear to be as deep as previously feared, while at the same hopes of a quick recovery have been raised. We can conclude that our business continued to perform well, which is confirmation of the strength of Länsförsäkringar’s business model. Our strategy remains firm whereby we will continue to provide the conditions for the regional insurance companies to create security through Länsförsäkringar’s full-service customer offering. The outcome of the SKI survey in the early summer also revealed that Länsförsäkringar Bank’s customers are among the most satisfied in terms of how the banks have handled the corona pandemic. Despite the challenging situation, we are delivering stable earnings. Lending is continuing to grow and the trend in deposits was strong. Net interest income also performed well. The quality of our lending remains very good and we can conclude that our large mortgage portfolio is of very high credit quality. During the quarter, we made additional loss allowances, primarily related to Wasa Kredit’s business, which provides resilience in the event of a weaker economic climate”, says Sven Eggefalk, President of Länsförsäkringar Bank.

The period in brief, Group

  • Operating profit declined 8% to SEK 876.4 M (957.8) and the return on equity amounted to 8.3% (9.8).
  • Net interest income rose 7% to SEK 2,423 M (2,272).
  • Operating income increased 10% to SEK 2,148 M (1,960).
  • Operating expenses rose 11% to SEK 1,040 M (933.6).
  • Due to the weaker macroeconomic outlook, additional loss allowances totalling SEK 154.6 M were made in the first and second quarters of 2020, of which SEK 127.6 M was attributable to Wasa Kredit.
  • Credit losses amounted to SEK 232.2 M (69.0), net, corresponding to a credit loss level of 0.13% (0.04).
  • Business volumes rose 8% to SEK 668.8 billion (616.6).
  • Deposits rose 13% to SEK 131.1 billion (115.9). Lending increased 5% to SEK 317.50 billion (301.7).
  • The Common Equity Tier 1 capital ratio for the Consolidated Situation amounted to 16.5% (15.8*) on 30 June 2020.
  • The number of customers with Länsförsäkringar as their primary bank increased 7% to 572,000 (535,000).

     Figures in parentheses pertain to the same period in 2019.
     * Pertains to 31 March 2020.

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For further information, please contact:

Sven Eggefalk, President Länsförsäkringar Bank AB
+46 (0)8-588 414 37, +46 (0)70-240 47 04

Anders Borgcrantz, CFO, Länsförsäkringar Bank AB,
+46 (0)8-588 412 51, +46 (0)73-964 12 51

Martin Rydin, Head of Treasury Länsförsäkringar Bank AB,
+46 (0)8-588 412 79, +46 (0)73-964 28 23

Stefan Karkamanis, Investor Relations, Länsförsäkringar Bank AB
+46 (0)8-588 402 90, +46 (0)72-310 00 80
This is information that Länsförsäkringar Bank AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 12:00 CET on 22 July 2020.

The Länsförsäkringar Alliance is comprised of 23 local and customer-owned regional insurance companies and the jointly owned Länsförsäkringar AB. Customers are provided with a complete offering of banking and life and non-life insurance services through their local, regional insurance companies. We offer animal and crop insurance through Agria Djurförsäkring, total solutions for reliable mortgage transactions through Länsförsäkringar Fastighetsförmedling, and financing services such as leasing, instalment payments, and loans through Wasa Kredit.