Swedbank Mortgage year-end report 2011

Swedbank Mortgage year-end report 2011


  · The operating profit amounted to SEK 3 773m (3 179)

  · Swedbank Mortgage reported credit impairments of SEK 56 m (168)

  · Covered bonds amounting to SEK 233bn have been issued during the period

The Swedbank Mortgage Group (in Swedish: Swedbank Hypotek) comprises the parent
company, Swedbank Mortgage AB (publ) and the wholly owned subsidiary Swedbank
Skog och Lantbruk AB (inactive company). Swedbank Mortgage is wholly owned by
Swedbank AB (publ). Swedbank Mortgage provides long-term financing for
residential housing, commercial properties, municipal investments and
agricultural and forestry properties. Numbers within parenthesis refer to the
corresponding period from the previous year unless noted otherwise.

Profit analysis

Operating profit amounted to SEK 3 773m (3 179) and net interest income to SEK 4
147m (4 069).

The net interest income rose marginally during the year. Both interest income
and interest expense increased as a result of rising short-term market rates and
growing volumes of lending and funding. Interest expense was also affected by
the average maturities on all funding from the money market and capital market
being further prolonged.

Net commissions mainly consist of costs arising from the interchange with the
savings banks and partly owned banks. These commission costs amounted to SEK
609m (562). A new long-term agreement with the savings banks and partly owned
banks is valid from the 1st of July 2011 to 30th of June 2017, with the
possibility to extend the agreement.

Net gains and losses on financial items at fair value (NGL) include realized and
unrealized changes in market values. In April 2009 a gradual transition was
initiated to increase amortized cost accounting and hedge accounting by applying
fair value hedge accounting and cash flow hedging, which in the long term will
reduce the effect of the so called fair value option. Net gains and losses on
financial items at fair value amounted to SEK 233m (-206). The single most
important cause to this trend is that long-term market rates have plunged during
the year, which has had a positive effect on the P/L.

For further information:

Please access the complete report at www.swedbank.com/ir or in the enclosed pdf

Peter Stenborn, President

Phone: 08-585 909 30

Kristina Norin, CFO

Phone: 08-585 902 72