Swedbank on Thursday reported a 4% fall in second-quarter net profit, as the Swedish lender booked unexpected credit losses after a period of gains from loan loss reversals.
The bank's net profit for the quarter was 7.89 billion Swedish kronor, down from 8.20 billion kronor in the first quarter.
Swedbank reported credit impairments, or expected losses on loans, of 150 million kronor, a significant swing from a net reversal of 141 million kronor in the previous quarter.
The result contrasts with some Nordic peers, such as Handelsbanken, which continued to report net reversals on credit losses in the same period.
Total income fell 2% to 16.96 billion kronor, weighed down by a 5% drop in net interest income, a key measure of profitability from lending.
Despite the weaker result, Chief Executive Jens Henriksson said in a statement, “Swedbank has once again delivered a strong result”.
The bank's return on equity for the quarter was 15.4%, and its Common Equity Tier 1 capital ratio, a measure of financial strength, was stable at 19.7%, the company said.
More from this issuer
Related coverage
Swedbank AB said Monday it has finalized its acquisition of mortgage technology company Stabelo, a move aimed at strengthening its digital lending capabilities and reaching new customers.
Swedbank AB on Thursday reported an 8% rise in third-quarter net profit, but saw its credit losses deepen, challenging the company's claim of "solid credit quality."
Swedbank AB said Friday that the U.S. Securities and Exchange Commission has closed an investigation into the Swedish lender without taking any enforcement action, a significant step in resolving legacy issues that have shadowed the bank.
Swedbank AB on Monday launched a new investment bank, SB1 Markets, in partnership with SpareBank 1, a move to strengthen its corporate finance services as profits from its core lending business come under pressure.