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Swedbank bounces back into the black

Swedish bank Swedbank surprised analysts on Tuesday with 2010 figures showing that the country's fourth largest bank was back in profit.

Swedbank bounces back into the black

Operating profits of 3.44 billion kronor ($540 million) were posted in the fourth quarter, up from a loss of 1.7 billion in the corresponding period of 2009, and helping to push full year profits into the black.

“We expected a gradually rising profit trend. In fact, we now see that profit for the full-year was stronger than anticipated, largely thanks to the recovery in the Baltic countries,” CEO Michael Wolf said in a statement.

Net interest income rose in the quarter to 4.53 billion kronor (3.98 billion) with profit before impairments excluding non-recurring items decreasing by 2 percent to 3.33 billion kronor (3.41).

Total revenues amounted to 7.96 billion for the quarter (7.98 billion) with costs up to 4.59 billion kronor from 4.3 billion kronor

The result for the full year was 7.44 billion (-10.51). Net interest income decreased by 21 percent to 16.33 billion (20.77 billion).

Provisions for loan losses amounted to 1.41 billion (21.80 billion) for the year.

The bank stated that in the Baltics, Russia and Ukraine recoveries were greater than the credit losses in the quarter. In the Baltic banking operations recorded net recoveries of 163 million. In Russia and Ukraine net recoveries amounted to 521 million.

The bank announced that its plans to buy back 10 percent of its stock and forecast a gradual improvement in earnings throughout 2011.

Swedbank’s stock climbed on the report and had by 4pm settled around 5 percent up in Stockholm trading.

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BREXIT

Brits in EU risk losing UK bank accounts ‘within weeks’

Some of Britain's biggest banks have begun contacting customers in European Union countries, warning them that their accounts will be closed down within weeks because the cost and complexity of operating without a continuation of pan-European banking rules is too much.

Brits in EU risk losing UK bank accounts 'within weeks'
Lloyds Bank expects to close at least 13,000 accounts. Photo: Lloyds Bank
According to a report in The Times, thousands of Britons who live in Europe face being stripped of their UK bank accounts and credit cards, because of the UK government's failure to agree rules for operating after Brexit. 
 
Each of the EU's 27 member states has different rules for cross-border bank accounts which will start to apply immediately the UK's transition period ends on 31st December 2020. 
 
“In some cases, continuing to serve customers would be incredibly complex, extremely expensive and very time-consuming, and simply would not make economic sense,” a source at one British bank told the newspaper. “This is passporting — this is the reality of Brexit.”
 
 
If a way is not found to continue pan-European banking rules, or passporting, UK banks will br breaking the law if they don't apply for new banking licenses in each European Union Country. 
 
 
Lloyds, Britain’s biggest banking group, began writing to customers in August, warning them that their bank accounts would  close down on December 31.
 
The bank estimates that 13,000 customers, including those based in Holland, Slovakia, Germany, Ireland, Italy and Portugal, would lose their accounts. 
 
“If customers have regular deposits into, or payments out of, their account, they will need to make other arrangements before their account is closed,” the bank said. 
 
Barclays and Coutts have also started contacting customers. 
 
“In light of the UK leaving the EU at the end of 2020, we continue to review the services we offer to customers within the European Economic Area (EEA), and any impacted customers will be contacted directly,” Barclays said in a statement. “The timings for account closure will depend on the type of product that a customer holds, but we will always give notice to customers.”
 
“In the event that no alternative to the European Economic Area passporting regime for financial services is agreed between the UK and EU, we have taken the difficult decision to withdraw from offering our services to clients who reside in the EEA,” Coutts said. 
 
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