FINANCIAL PERFORMANCE January - June 2011 compared with January - June 2010 For the period January to June 2011, operating profit increased by SEK 209 million to SEK 2,813 million (2,604). Net interest income amounted to SEK 2,921 million (2,705), with the branch in Norway accounting for SEK 198 million (222), the branch in Denmark, established on 1 May 2010, accounting for SEK 39 million (1) and the branch in Finland, established on 1 May 2011, accounting for SEK 1 million (-). Thus, excluding the branches, net interest income rose by SEK 201 million compared with the corresponding period of the previous year, which was mainly due to an increase in lending volume. However, net interest income was affected negatively by SEK 46 million compared with the corresponding period of the previous year, since from 1 January 2011, the fee to the Swedish Stabilisation Fund is no longer halved. Net gains/losses on financial items at fair value amounted to SEK 1 million (3). Expenses rose by SEK 13 million to SEK 124 million (111), primarily due to increased costs for purchased services from the parent company. Recoveries exceeded new loan losses and the net amount recovered was SEK 21 million (17), which corresponds to a loan loss ratio of -0.01 per cent (0.00) of lending. Before deduction of the provision for probable loan losses, the volume of impaired loans was SEK 85 million (109). SEK 51 million (43) of the impaired loans were non-performing loans, while SEK 34 million (66) were loans on which the borrowers pay interest and amortisation, but which are considered doubtful. There were also non-performing loans of SEK 753 million (613) that are not classed as being impaired loans. After deduction for a specific provision totalling SEK -33 million (-48) and a collective provision of SEK -5 million (- 7) for probable loan losses, impaired loans totalled SEK 47 million (54). Q2 2011 compared with Q1 2011 Stadshypotek's operating profit for the second quarter of 2011 decreased by SEK 15 million to SEK 1,399 million (1,414). However, net interest income increased by SEK 45 million to SEK 1,483 million (1,438), of which SEK 93 million (105) was attributable to the branch in Norway, SEK 20 million (19) to the branch in Denmark and SEK 1 (-) million to the branch in Finland. Excluding these branches, net interest income thus rose by SEK 55 million, which is due to higher margins and a continued increase in lending volumes. Net gains/losses on financial items at fair value amounted to SEK -30 million (31). Expenses rose by SEK 2 million to SEK 63 million (61). GROWTH IN LENDING Loans to the public increased during the period by SEK 36 billion to SEK 795 billion (759). Stadshypotek's share of the private market in Sweden was approximately 25 per cent (25) and its share of the corporate market in Sweden was approximately 33 per cent (30). BRANCH IN FINLAND During the second quarter, Stadshypotek started a branch in Finland called Handelsbanken Asuntoluottopankki. The branch's loans to the public were SEK 0.4 billion as at 30 June. CAPITAL ADEQUACY The capital ratio according to Basel II was 60.7 per cent (44.4) while the Tier 1 ratio calculated according to Basel II was 41.4 per cent (33.1). Further information on capital adequacy is provided in the 'Capital base and capital requirement' section on page 13. RATING Stadshypotek's rating remained unchanged, with a stable outlook. Stadshypotek +-----------------+-------------+---------+----------+ | |Covered bonds|Long-term|Short-term| +-----------------+-------------+---------+----------+ |Moody's |Aaa |- |P-1 | +-----------------+-------------+---------+----------+ |Standard & Poor's| |AA- |A-1+ | +-----------------+-------------+---------+----------+ |Fitch | |AA- |F1+ | +-----------------+-------------+---------+----------+ Stockholm, 20 July 2011 Rainer Lawniczak Chief executive [HUG#1532209]
Stadshypotek's interim report January-June 2011
| Source: Stadshypotek AB
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