By Dominic Chopping
STOCKHOLM--Skandinaviska Enskilda Banken AB (SEB-A.SK) on Wednesday reported a forecast-beating fourth-quarter net profit amid high client activity and higher interest rates, despite higher costs from strategic investments and combating money laundering.
The Sweden-based bank posted net profit of 5.83 billion Swedish kronor ($605.8 million) for the three months ended Dec. 31 compared with SEK4.58 billion a year earlier, beating the SEK5.05 billion forecast from analysts polled by FactSet.
Net interest income rose 14% to SEK5.93 billion while operating costs rose 8.4% to SEK6.03 billion.
"This was yet another quarter of high client activity and we continued to grow across our home markets," Chief Executive Johan Torgeby said.
"The investments in our strategic initiatives, aiming to accelerate transformation by leveraging new adjacent business opportunities, have also developed broadly as expected and we remain committed to deliver on our cost target of SEK23 billion for 2021."
The bank's common equity Tier 1 ratio--a key measure of financial strength--stood at 17.6% at the end of the quarter, unchanged from last year.
In November last year, Swedish state broadcaster SVT reported that it suspected almost 200 nonresident customers laundered money through Swedish and Baltic accounts at SEB, but the bank responded by saying that its own analysis had found it hadn't been used for money laundering in a systematic way.
However, the Swedish FSA is investigating SEB's governance and control of measures to combat money laundering, in cooperation with supervisory authorities in Estonia, Latvia and Lithuania.
The result of the FSA's investigation into SEB is expected in April 2020.
The bank proposed a full-year dividend of SEK6.25. Last year it paid an ordinary dividend of SEK6.00 plus an extraordinary dividend of SEK0.50.
Write to Dominic Chopping at firstname.lastname@example.org
(END) Dow Jones Newswires
January 29, 2020 02:27 ET (07:27 GMT)
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