04 May 2007 08:00

SEB - operating profit SEK 4.2bn (3.7)

  • Operating profit for the first quarter 2007 was SEK 4,157m, an increase of 13 per cent compared with the corresponding quarter of 2006 and 1 per cent better than the previous quarter. Net profit was SEK 3,262m.
  • Business flows were strong within all areas. Assets under management as well as lending and deposit volumes reached record levels.
  • Operating income increased by 6 per cent compared with the first quarter last year and was 2 per cent up on the previous quarter.
  • Operating expenses were in line with the corresponding quarter last year and 2 per cent higher than in the previous quarter.
  • Net credit losses remained low.
  • Return on equity was 19.0 per cent (19.6) and earnings per share increased to SEK 4.81 (4.22).
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    President's comment
     
    2007 has started positively. The favourable economic climate continued to cater for high business activity and strong volume growth in all of SEB's markets. Return on equity remained close to 20 per cent at the same time as the capital base was strengthened.  Revenue generation was strong and earnings per share increased by 14 per cent on a 12-months basis.
     
    SEB has put more emphasis on high interaction with its customers. Increased activity among corporate customers and private individuals resulted in both improved net interest income and commission income, even though higher volatility in the equity market hampered investors' risk appetite. High volumes and relatively stable margins supported revenue growth.
     
    The contribution from SEB's markets outside Sweden was the highest ever, 57 per cent of the operating profit. Profit growth was particularly strong in Lithuania, Norway and Denmark. SEB continues to monitor closely the economic development in Estonia and Latvia with a focus on long-term quality and return of the businesses.
     
    SEB last year initiated structural measures to achieve leadership in customer satisfaction and financial performance. This is a long-term commitment to excellence and SEB is still at an early phase of realising the full potential of a more integrated SEB. During the first three months of the three-year efficiency plan, the new Group structure became operational. It facilitates a more coordinated customer offering and increases efficiency. This allows more integrated support functions, which reduces overlaps and increases quality. As an example, the HR, procurement and premises functions are now integrated at Group level.
     
    At the same time the operational excellence programme, SEB Way, has accelerated to streamline both front- and back-office processes and enhance customer offerings.
     
    The divestments of the Baltic real estate, Union Inkasso and ÅF Bil are also examples of more focused and streamlined operations.
     
    The development during the first quarter indicates a positive outlook for 2007. We will continue to invest in growth areas, partly through reallocation of resources. SEB's ability to continue to grow organically is strong.
     
     
    The full report including tables and additional information can be downloaded from the links below.