Morningstar | Skandinaviska Enskilda Banken Reports First-Quarter 2019 Results: Fair Value Estimate Maintained
No-moat SEB reported first-quarter net profits of SEK 4.7 billion compared with SEK 4 billion in the same period last year as higher client activity and supportive financial markets yielded an uplift in results in large corporates and financial institutions. We maintain our fair value estimate of SEK 96 per share.Business with large corporates was supported by lower credit spreads increasing bond issuance volumes, while mergers and acquisitions activities related to the end of 2018 spilled over into the first quarter this year, further lifting performance. High customer activity driven by cautionary signals from central banks resulted in increased investment portfolio shifts and an uptick in customer transactions related to currency risk hedging in the beginning of the quarter, which leveled out as volatility subsided toward the end of the quarter. In sum, operating income increased 25% to SEK 5.1 billion for the segment, although this is largely a function of a weak first-quarter 2018 base. Credit costs increased to SEK 322 million compared with SEK 46 million in the same period last year.
In the corporate and private customers segment, net interest income increased to SEK 2.7 billion versus SEK 2.3 billion a year prior as corporate lending volume growth and the repo rate hike in January more than offset margin pressure in mortgage lending. Operating income for the segment increased 13% year over year, which, in combination with 5% higher expenses, resulted in operating profits for the segment growing to SEK 2.3 billion from SEK 1.9 billion last year.
The remaining segments showed mixed results. Lending in the Baltics grew below nominal GDP of 7% as Estonia’s economic cycle starts to reach peak levels. Operating profits for the region were up 18%. Life and investment management, on the other hand, returned SEK 102 million and SEK 393 million less, respectively, compared with a year prior.
Skandinaviska Enskilda Banken provides corporate, retail, investment and private banking services, as well as asset management and life insurance services. Merchant Banking provides wholesale and investment banking services to corporations and institutions. Retail Banking provides products mainly to private customers and small and medium-sized corporate. Wealth Management performs asset management and private banking activities and Life provides life, care and pension insurance. Division Baltic provides retail, asset management and private banking services in the Baltic countries. As of Dec 31 2013, Co. had total assets of SEK1,904.16 billion and total deposits of SEK821.47 billion.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.