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Baltic crisis hits Swedish bank Swedbank in Q1
Published in Saudi Press Agency on 23 - 04 - 2009

Swedish bank Swedbank AB reported Thursday a first-quarter net loss, missing analysts'
expectations for a profit, due to large provisions for loan
losses in its hard-hit Baltic operations, AP reported.
The Stockholm-based bank said the net loss for the quarter
totaled 3.36 billion kronor ($396 million), down from a
profit of 2.9 billion kronor in the same period a year ago.
The figures disappointed investors, who sent Swedbank
shares down 9 percent to 42.70 kronor ($5.03) in Stockholm.
Of Sweden's major banks, Swedbank has suffered most from
the global credit crunch because of its large exposure to
the dramatic economic slump in the Baltic nations of
Latvia, Lithuania, Estonia, as well as the Ukraine.
Loan losses for the period widened to 6.85 billion kronor
($807 million) from 288 million a year earlier. The bank
said 6.6 billion of the total were provisions, mostly for
the Baltics.
«Swedbank today faces one of the biggest challenges in
the bank's history. The global economic downturn has
worsened as the financial crisis increasingly affects the
real term economy,» Swedbank's chief executive officer
Michael Wolf said in a statement.
The company said it has decided to reevaluate the markets
in Ukraine and Russia and develop its business there with
«a low level of ambition» due to the economic and
political uncertainties.
It will reduce the number of branches and cut staff at its
operations in the Baltics in the coming quarters, with an
aim to cut costs there by 15 percent.
The bank said the deteriorating economic outlook in the
Ukraine also resulted in an impairment of intangible assets
of 1.3 billion kronor ($150 million) in the quarter.
Net interest income rose to 5.8 billion kronor ($680
million) from 5.2 billion kronor a year earlier.


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