Swedbank - Interim report January - September 2008

Profit for the period increased by 1 percent compared with the first three quarters of 2007
Profit for the period amounted to SEK 8 972m (8 888)
Earnings per share amounted to SEK 17.41 (17.25)
The return on equity was 17.0 percent (19.0)
The cost/income ratio was 0.50 (0.51)
Net interest income increased by 15 percent to SEK 15 960m (13 898)
Net loan losses amounted to SEK 1 523m (381), corresponding to a loan loss ratio of 0.18 percent (0.06)
The tier 1 capital ratio was 8.7 percent according to the new rules (8.5 percent on 31 December 2007) and 6.8 percent (6.2) according to the transition rules.

Lower profit in the third quarter compared with the second quarter 2008
Profit for the period decreased by SEK 1 136m to SEK 2 468m (3 604), where of net gains and losses on financial items at fair value decreased by SEK 1 250m to SEK -109m (1 141)
Earnings per share amounted to SEK 4.79 (6.99)
The return on equity decreased to 13.8 percent (20.6)
The cost/income ratio was 0.52 (0.47)
Net interest income increased by 2 percent to SEK 5 424m (5 295)
Net loan losses amounted to SEK 812m (423), corresponding to a loan loss ratio of 0.27 percent (0.14).

Effect of financial crisis on third quarter results
The global financial markets turmoil adversely affected Swedbank’s third quarter results, mainly due to lower net gains and
losses on financial items at fair value. Examples include:
• Negative valuation effects in Swedbank Markets’ credit bond portfolio of SEK 217m.
• Loan loss provisions of SEK 169m in unsecured trading exposure to Lehman Brothers.
• Drop of SEK 356m in Swedbank Mortgage’s income due to prolonged liquidity and turbulence in the funding markets, among other things (net interest income and net gains and losses on financial items at fair value).
• Negative valuation effects of around SEK 100m in the Baltic trading, liquidity and insurance portfolios.
• Lower income of SEK 98m in Swedbank Robur.

President and CEO comments
The global economy and financial system is being affected by unprecedented turbulence. The financial crisis has spread rapidly and is
impacting the development of the real economy worldwide and Swedbank’s domestic markets are no exception to this.
Swedbank is committed to working with and supporting its customers in this extremely testing environment. The bank has solid
profitability. Results for the period show stable profits in line with the same period in 2007. The bank’s financial risks are limited.
Swedbank is taking measures to balance development for example by raising credit quality requirements and by stricter relation
between deposits and lending. Cost-cutting and efficiency measures remain high priority issues.