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SEB files for state funds as profits collapse

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11:13 CEST+02:00
Swedish bank SEB said on Friday that it would seek to join the state-backed guarantee programme after reporting a 44 percent decline in net profits for the first quarter.

"The board has decided to apply for SEB's participation in the Swedish funding guarantee programme. The application will be filed within the next few days," SEB said a statement.

The bank, which is badly exposed to the crisis-hit Baltic economies, initially said it would not join the programme.

But as net profits dropped to 1.03 billion kronor ($125 million) in comparison to 1.85 billion kroner for the same period last year, the bank announced a change in its stance.

SEB underlined that despite the dramatic fall in profits it remained in the black in the first quarter.

The Swedish government announced at the end of October the launch of a guarantee scheme worth 1.5 trillion kronor to help struggling banks with liquidity problems to secure needed loans.

Only one major financial institution, Swedbank, has signed up to the scheme so far.

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