Nordea & Handelsbanken see earnings tumble

Nordic banking groups Nordea and Handelsbanken posted sharply lower second quarter earnings on Tuesday as they felt the sting of the ongoing global financial crisis.

For the April to June quarter, Nordea, the largest bank in the Nordic region, reported a 15 percent drop in net profits to 693 million euros ($1.1 billion) from 816 million a year earlier.

On a more positive note, the bank’s total operating income during the quarter came in two percent higher than the corresponding period of last year at 1.99 billion euros, the bank said in its earnings statement.

Nordea also lowered its outlook for the remainder of 2008 to around five percent growth, down from a previous estimate of between five and 10 percent.

“Signs of slowing international economic growth particularly in the United States and in large parts of Europe, are becoming increasingly apparent,” the group said in its statement.

“The Nordic economies have so far been relatively resilient in the face of the international slowdown, but the uncertainty has gradually increased.”

After issuing its report, Nordea saw its stock price slip 4.15 percent to 85.40 kronor ($ 14.37) per share in midday trading on the Stockholm stock exchange, which by 12pm was down 2.88 percent.

Nordea’s Swedish competitor Handelsbanken meanwhile also saw its earnings erode in the second quarter compared to the corresponding period of 2007, although results improved somewhat from the beginning of the year.

From April to June, the banking group’s net profit plunged 34 percent to 2.478 billion kronor, down from 3.733 billion kronor a year earlier.

Total income also slipped five percent year-on-year to 7.199 billion kronor, while its operating profit shrank 22 percent to 3.433 billion kronor.

In its earnings statement, Handelsbanken however stressed that its net profit increased by eight percent from the first quarter of 2008, while its operating profit jumped 18 percent and total income was up 19 percent in the same period.

After posting its results, Handelsbanken’s stock price inched up 0.64 percent to 156.50 kronor per share.


Swedish banking giant sacks its top boss

Sweden's Handelsbanken has fired its chief executive, Frank Vang-Jensen.

Swedish banking giant sacks its top boss
Frank Vang-Jensen. Photo: Maja Suslin/TT

He will be replaced by Anders Bouvin, who will take up the position with immediate effect, the bank said in a statement. 

The board of the bank decided unanimously to let Vang-Jensen go after just a year and a half in the post. 

“This decision is purely related to the individual. Handelsbanken remains strong and our long-term goals stand firm,” said board chairman Pär Boman. 

He added that the post required a “special type of leadership”.

“Thus, it is possible to be an excellent leader and manager – as Frank Vang-Jensen has been – but not fulfil the requirements of CEO of Handelsbanken.” 

His successor, Anders Bouvin, has been Executive Vice President since 2002. He was posted in New York and Denmark before most recently heading up the bank’s operation in the UK.  

“Anders Bouvin has worked at Handelsbanken for more than 30 years and is totally familiar with the Bank’s working methods, culture and values. For the past ten years, he has worked at Handelsbanken in the UK, where he has built up a national branch network with stable finances, good profitability – and by far the most satisfied customers in the market,” said Boman.