Svenska Handelsbanken has exceeded expectations with its third-quarter net profit, showcasing a significant increase in net interest income. The Swedish bank recorded a net profit of 7.95 billion Swedish kronor ($728.6 million) compared to SEK5.79 billion the year before, surpassing the FactSet consensus forecast of SEK6.75 billion.
The rise in net interest income can be attributed to an increase from SEK9.58 billion to SEK12.18 billion, surpassing the forecast of SEK11.93 billion. Nonetheless, Svenska Handelsbanken cites the economic slowdown and higher interest rates as factors that have led to stabilization in deposit and lending volumes. This has also intensified competition in both areas.
Despite these challenges, Chief Executive Carina Akerstrom expressed satisfaction with the company’s performance. “Income has risen, despite the economic slowdown, and we have seen continued growth in both net interest income and our savings business,” she stated. Additionally, Akerstrom highlighted the bank’s cost-efficiency measures, which have contributed to improved cost-to-income ratios.
Furthermore, Svenska Handelsbanken boasts a solid financial position with a common equity Tier 1 ratio of 19.4%, up from 19.0%. Akerstrom is optimistic about the future, stating that the bank is well-positioned for robust and stable growth and profitability.
Overall, Svenska Handelsbanken’s impressive third-quarter results demonstrate its resilience in a challenging economic environment.
By Dominic Chopping