STOCKHOLM (Reuters) - Swedish banking group Swedbank (SWEDa.ST) reported first-quarter operating profit above market expectations on Tuesday, boosted by higher income and lower loan losses, and said it saw signs that the Swedish housing market was stabilising.
Swedbank, one of Sweden’s biggest mortgage lenders with about a quarter of the Swedish market, saw operating profit rising to 6.44 billion Swedish crowns (543.1 million pounds).
That was above a mean forecast for 5.99 billion crowns in a Reuters poll of analysts, and compared with 6.31 billion crowns in the year-ago period.
“It’s a quarterly report of very high quality. There are no surprises and we improve on all lines in the report,” Swedbank CEO Birgitte Bonnesen said in a telephone conference.
Net interest income, which includes income from mortgages, rose 5 percent to 6.29 billion crowns from 5.97 billion crowns a year ago and 6.22 billion crowns in a Reuters poll of analysts.
Sweden’s housing market has endured a rocky six months after decades of mostly good gains. Prices have dropped after the announcement of stricter repayment rules for mortgage takers. However, Bonnesen said things were looking good.
“We see prices are stabilising,” she said, adding the market share for Swedish mortgages was 24 percent in the first quarter and that margins were stable.
Net commission income rose to 3.08 billion crowns from 2.82 billion crowns a year ago and 3.02 billion crowns in the poll.
Loan losses were down to 127 million crowns, compared with 339 million crowns in the year-ago period and a loss of 280 million crowns in the analyst poll.
Reporting by Johan Ahlander; editing by Niklas Pollard and Gopakumar Warrier