Swedbank AB (publ) (SWED-A.ST) | Investment Case

1. Company Snapshot

1.a. Company Description

Swedbank AB (publ) provides various banking products and services to individuals and companies.The company operates through Swedish Banking, Baltic Banking, and Large Corporates & Institutions segments.It offers savings accounts, mutual funds and insurance savings, pension savings, institutional asset management, and other savings and investment products; private residential lending, consumer financing, corporate lending, leasing, other financing products, trade finance, and factoring services; and current accounts, cash handling, debit and credit cards, card acquiring, other payment products, as well as domestic, international, mobile, and document payments.

The company also provides equity trading, structured products, corporate finance, custody services, fixed income and currency trading, and other capital market products; and administrative services, treasury operations, real estate brokerage and management, legal services, safe deposit boxes, and others.In addition, it offers asset management, as well as life insurance and pension services; investment and trading services, including currency, fixed income, and equity and related derivatives services, as well as structured products; advisory and investment banking products and services, such as corporate financing, debt capital market, leveraged finance, and loans and syndication; and transaction banking services comprising cash management, trade finance, securities, commercial payments, account, and clearing and settlement services.Further, the company provides telephone, Internet, and mobile banking services.

The company operates 153 branches in Sweden, 17 branches in Estonia, 21 in Latvia, and 42 in Lithuania.It also has operations in Norway, Finland, Denmark, China, the United States, and South Africa.The company was formerly known as ForeningsSparbanken AB and changed its name to Swedbank AB (publ) in September 2006.

Swedbank AB (publ) was founded in 1820 and is headquartered in Sundbyberg, Sweden.

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1.b. Last Insights on SWED

Swedbank AB (publ) has experienced a significant rally, driven by several positive factors. The company's acquisition of Stabelo to expand its mortgage operations has enhanced its growth potential. Furthermore, the US SEC's decision to close its investigation into Swedbank without enforcement action has alleviated regulatory concerns. Additionally, the company's robust track record, with a 123.4% gain over the past three years and 181.3% over five years, has instilled investor confidence. These developments have likely contributed to the company's recent momentum.

1.c. Company Highlights

Last Price	303.1
Change Percentage	0.17%
Open	303
Previous Close	302.6
Market Cap ( Millions)	340753
Volume	1274337
Year High	307.3
Year Low	186.4
M A 50	290.86
M A 200	262.29

FCF Yield	16.82%
Dividend Yield	7.16%
ROE	15.64%
Debt / Equity	484.34%
Net Debt / EBIDTA	2433.18%
Price To Book	1.56
Price Earnings Ratio	10.31
Price To FCF	5.94
Price To sales	2.73
EV / EBITDA	32.19

2. Swedbank's Q3 Earnings: A Strong Performance

Swedbank reported a robust financial performance in the third quarter, with earnings per share (EPS) of SEK 7.49, surpassing analyst estimates of SEK 6.61. The bank's return on equity (ROE) stood at 16%, driven by a combination of increased income and decreased costs, resulting in a cost-to-income ratio of 0.35. Net interest income decreased by 0.9% compared to the previous quarter, primarily due to lower mortgage rates, but was partially offset by a positive impact of SEK 94 million from business volumes.

Publication Date: Oct -24

📋 Highlights

Capital Position and Liquidity

Swedbank's capital position remains strong, with a CET1 capital ratio of 19.7% and a buffer of around 480 basis points above the requirement. The bank's liquidity position is also robust, with a liquidity coverage ratio of 144%. According to CEO Jens Henriksson, "Swedbank is well-positioned for sustainable growth and profitability, with a focus on strengthening customer interactions, growing volumes, and increasing efficiency."

Business Performance

The bank's customer focus is yielding results, with 70% of incoming calls in Sweden answered within 3 minutes. Swedbank's digital offerings continue to improve, with more customers using its app or internet bank for everyday banking. The acquisition of the remaining part of Entercard is expected to strengthen Swedbank's card business in the Nordic-Baltic region.

Valuation and Outlook

Swedbank's valuation metrics appear reasonable, with a Price-to-Tangible Book Value (P/TBV) ratio of around 1.55 and a Dividend Yield of 7.56%. The bank's net interest income is expected to face pressure due to interest rate cuts, but this impact may be offset by volume growth. With a strong capital position and a focus on cost efficiency, Swedbank is well-positioned for sustainable growth and profitability.

Future Prospects

The bank's guidance for full-year 2025 costs is around SEK 25.3 billion, and it expects bank taxes to increase in 2026. Swedbank's US investigation remains ongoing, but the SEC has closed its investigation without further action. The bank's management notes that volume growth in lending and deposits can offset some of the negative impact of rate cuts on net interest income.

3. NewsRoom

Sanoma has signed a new EUR 220 million syndicated term loan

Dec -05

Source:

Swedbank (OM:SWED A): Breaking Down the Valuation Behind Recent Share Price Gains

Nov -30

Source:

Barclays Shares Surge 68.4% YTD: How to Play the Stock Now

Nov -28

Source:

Best Momentum Stock to Buy for Nov. 19th

Nov -19

Source:

2025 9 months and III quarter consolidated unaudited interim report

Nov -06

Source:

EBRD supports largest onshore wind farm in Baltic region

Oct -24

Source:

What Recent Analyst Updates Mean for Swedbank’s Evolving Story and Valuation

Oct -23

Source:

Swedbank (OM:SWED A) Valuation: Gauging Upside Potential After Recent Share Price Gains

Oct -22

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.07%)

6. Segments

Swedish Banking

Expected Growth: 4.5%

Swedbank AB’s strong presence in Sweden drives growth, with increasing demand for retail and corporate banking services. The bank’s digital transformation and cost-cutting initiatives also support growth prospects.

Baltic Banking

Expected Growth: 5.5%

Increasing demand for retail and corporate banking services in Estonia, Latvia, and Lithuania drives growth. Swedbank’s strong brand and extensive network will support market share gains, with the Baltic region’s economic growth and EU funding supporting loan growth and fee income.

Corporates & Institutions

Expected Growth: 5.5%

Swedbank AB (publ) provides tailored financial solutions and services to large corporations, financial institutions, and public sector entities, driving growth through its diversified product offerings and strong market presence.

Group Functions & Other

Expected Growth: 4.5%

Swedbank’s Group Functions and Other segment growth is driven by cost savings initiatives, and the bank's efforts to simplify and streamline its operations, which are expected to offset the negative impact of declining Swedish economy.

Premium and Private Banking

Expected Growth: 5.2%

Swedbank AB (publ)’s Nordic private banking segment is expected to grow due to increasing wealth in the Nordic countries, driven by strong economic growth, and the bank’s strong brand and long-term relationships with clients.

Eliminations

Expected Growth: 5.5%

Swedbank AB (publ)’s growth is driven by its efforts to simplify operations, increase efficiency, and reduce costs, ultimately leading to improved profitability.

7. Detailed Products

Private Banking

Personalized banking services for high net worth individuals, including investment advice, wealth management, and tailored financial solutions.

Corporate Banking

Financial solutions for businesses, including cash management, trade finance, and risk management services.

Transaction Banking

Efficient and secure payment solutions for businesses, including account services, payment processing, and card services.

Card Services

Credit and debit card solutions for individuals and businesses, including payment processing and card management services.

Asset Management

Investment management services for individuals, companies, and institutions, including portfolio management and investment advice.

Life Insurance

Life insurance products and services, including term life, whole life, and pension insurance.

Pension and Savings

Pension and savings solutions for individuals and companies, including retirement planning and investment services.

Digital Banking

Online and mobile banking services, including account management, payment services, and investment platforms.

8. Swedbank AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

Swedbank AB (publ) operates in a highly competitive market, with many substitutes available to customers. However, the bank's strong brand recognition and extensive branch network help to mitigate the threat of substitutes.

Bargaining Power Of Customers

Swedbank AB (publ) has a large customer base, which gives customers significant bargaining power. The bank's customers have many options to choose from, and the bank must offer competitive pricing and services to retain them.

Bargaining Power Of Suppliers

Swedbank AB (publ) has a diverse supplier base, which reduces the bargaining power of individual suppliers. The bank's large scale of operations also gives it significant negotiating power with suppliers.

Threat Of New Entrants

The banking industry has significant barriers to entry, including regulatory hurdles and high capital requirements. This makes it difficult for new entrants to challenge established players like Swedbank AB (publ).

Intensity Of Rivalry

The banking industry is highly competitive, with many established players competing for market share. Swedbank AB (publ) must continually innovate and improve its services to maintain its market position.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	86.21%
Debt Cost	7.28%
Equity Weight	13.79%
Equity Cost	7.28%
WACC	7.28%
Leverage	625.02%

11. Quality Control: Swedbank AB (publ) passed 3 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

KBC

A-Score: 7.4/10

Value: 6.9

Growth: 6.0

Quality: 6.7

Yield: 7.5

Momentum: 9.0

Volatility: 8.3

1-Year Total Return ->

Swedbank

A-Score: 7.0/10

Value: 5.1

Growth: 8.2

Quality: 6.0

Yield: 5.0

Momentum: 9.0

Volatility: 9.0

1-Year Total Return ->

Danske Bank

A-Score: 6.8/10

Value: 5.5

Growth: 4.4

Quality: 5.6

Yield: 8.1

Momentum: 9.0

Volatility: 8.0

1-Year Total Return ->

UniCredit

A-Score: 6.7/10

Value: 6.2

Growth: 5.9

Quality: 6.8

Yield: 6.9

Momentum: 9.0

Volatility: 5.3

1-Year Total Return ->

Lloyds Banking

A-Score: 6.3/10

Value: 6.6

Growth: 2.8

Quality: 5.6

Yield: 6.9

Momentum: 8.5

Volatility: 7.3

1-Year Total Return ->

Deutsche Bank

A-Score: 5.8/10

Value: 8.3

Growth: 3.4

Quality: 5.9

Yield: 3.1

Momentum: 9.5

Volatility: 4.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-3.06%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.28%

Swedbank AB (publ) - SE0000242455

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on SWED

1.c. Company Highlights

Average Yield

Stable Momentum

Average Growth

Earnings Beats

Revenues Beats

Average Quality

Medium Volatility

Fairly Valued

Earnings Miss

Better Quality

Cheaper

Higher Growth

2. Swedbank's Q3 Earnings: A Strong Performance

Capital Position and Liquidity

Business Performance

Valuation and Outlook

Future Prospects

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.07%)

6. Segments

Swedish Banking

Expected Growth: 4.5%

Baltic Banking

Expected Growth: 5.5%

Corporates & Institutions

Expected Growth: 5.5%

Group Functions & Other

Expected Growth: 4.5%

Premium and Private Banking

Expected Growth: 5.2%

Eliminations

Expected Growth: 5.5%

7. Detailed Products

Private Banking

Corporate Banking

Transaction Banking

Card Services

Asset Management

Life Insurance

Pension and Savings

Digital Banking

8. Swedbank AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Swedbank AB (publ) passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

303.1$

12.e Scoring ^Insights

12.f DCF ^BETA