Swedbank AB (publ)

Good morning, and thank you for dialing into Swedbank's third quarter 2024 results presentation. My name is Annie Ho from Investor Relations, and we also have our C-suite here today. Jens Henriksson, our CEO, Anders Karlsson, our CFO, and Rolf Markvart, our CRO. We'll start with our usual presentation and follow up with Q&A. With that, I hand over to you Jens.

Thank you Annie. Swedbank has once again delivered a strong result. This time further supported by one-off and time effects. We are creating value for our customers and shareholders in both good and bad times. The global economy is being challenged by increased geopolitical uncertainty, low growth and high debt. In addition, Europe needs considerable investments. Looking at our home markets, Lithuania's economy is performing strongly, while Latvia is more sluggish. In Sweden and Estonia, it will take more time before households feel the impact of their stronger purchasing power and consumption begins to accelerate. The Fed, the ECB and the Riksbank cut their policy rates during the quarter and are expected to cut again before the end of the year and further in 2025. In 2025 and 2026, our four home markets will be among the fastest growing in Europe. Strong public finances, real wage growth, profitable banks and competitive business sectors provide a solid base for the future. In this environment, Swedbank stands strong. The result for the third quarter increased by 9% and amounted to 9.4 billion kronor. Net interest income was stable. Lower lending rates for customers were offset by lower funding costs. Net commission income increased by 3%, mainly from asset management and the underlying card business. cost decreased according to plan and we maintain strict cost control. The temporary hiring freeze introduced before summer is producing results, as do lower consulting costs. Our cost-to-income ratio was 0.31. We continue to invest in a better and stronger Swedbank. Fighting fraud, improving our payment systems, increasing availability, as well as the IRB overhaul are prioritized areas. Summing up, we delivered a return of equity of 18.4% and earnings per share of 8 kronor and 30 öre for the third quarter. A strong result. Swedbank has a conservative and thorough lending process. Our credit quality is solid and credit departments for the third quarter amounted to 270 million kronor. We generate capital and have a strong capital position with a buffer of 5.2 percentage points. Our liquidity position is strong. Cyber threats are a reality that we and other parts of society must deal with. As a systemic bank, we have high preparedness. Our work to fight financial crime and money laundering never stops. That Standard & Poor's raised their outlook on Swedbank to positive is one proof that we prioritize the work on anti-money laundering. The target of a sustainable return on equity of at least 15% is the foundation for our Swedbank 1525 plan. To deliver, we focus on our customer promise to make our customers' financial life easier. As planned, we have strengthened our local presence in corporate banking as well as premium and private banking. We continue to fine-tune our omnichannel communication platform to increase availability and the capacity for advisory meetings. Through our new savings platform, we have laid the foundation for a digital savings experience for both our customers and advisors, an important step in our work with financial health. A third of our Swedish private customers have so far been migrated to the new platform. Swedbank is the leader in mortgages in all our four home markets, and we maintain our position in tough and tight competition. During the quarter, we cut our mortgage rates. Lending increased in Estonia, Latvia and Lithuania and was stable in Sweden. Deposit volumes in Sweden decreased due to seasonal effects. In Estonia, Latvia and Lithuania, deposit volumes increased. Savings are an important part of our heritage and we continue to build a strong savings culture. Our Baltic customers in Estonia, Latvia and Lithuania can now increase their spontaneous savings by automatically rounding up purchases and depositing the extra amount in a savings account. Our RoboFunds remains an attractive investment alternative and Robo had a fund inflow and maintains a market-leading position. During the quarter, we saw stable customer activity in the corporate segment. We continue to optimize routines to improve our advisory by combining local presence with national expertise. Corporate lending is still muted in Sweden. In Estonia, Latvia and Lithuania, corporate lending grew. The commercial real estate sector's challenges of financing via the bond market are fading away. During the year, a third of the bonds we arranged were sustainable, sustainability bonds. That is the highest share among Nordic banks. In our own funding, we have issued our first green covered bond. Because sustainability is at the core of Swedbank business strategy. And our sustainability work is now focusing on two parts, financial health and energy transition. Our citizens' financial health is close to our heart, and it goes back to our roots. That's why we want to empower one million people in Sweden, Estonia, Latvia, and Lithuania to improve their financial health by 2030. Through education, we have continued to build financial literacy among both young and old. Through the Institute of Financial Health and the collaboration with the owner foundations, we reach the local communities. During the quarter, we continued to help customers accelerate the energy transition. as a transition that's important to mitigate climate change. We make a difference by financing sustainable energy consumption and production. For our Swedish corporate customers with commercial properties, we have joined together with our partner Rambol to launch the Incept platform to assist our customers in the energy transition. Let me now give the floor to Anders who will deep dive into the financials.

Thank you, Jens. Let's start with lending and deposits. The loan portfolio was stable, excluding a negative FX impact of 3 billion. In Sweden, total private mortgage lending was stable. Although household confidence was slightly improved, volumes in the market are still muted. Total corporate lending in Sweden decreased by 7 billion, mainly from property management. And in the Baltics, private lending increased by 3 billion and corporate lending by 6 billion. Customer deposits decreased by 7 billion, excluding a 2 billion negative FX impact. Private deposits increased in the Baltics by 5 billion, while it decreased in Sweden by 6 billion in this quarter. Corporate deposits in the Baltics increased by 1 billion, and it decreased by 7 billion in Sweden. Turning to the P&L. Profitability was very good. boosted by some one-offs and timing effects. Let's begin with net interest income, which was stable. Average volumes contributed positively. FX, day count effects, and a correction resulted in a net positive delta of around 90 million. During Q3, our total funding costs decreased in line with our lending income, as we have continued with our active pricing on both sides of the balance sheet. Part of our assets reprice gradually and slower than our liabilities following the changes in customer lending and deposit pricing that we did at the end of last quarter and this quarter. During a declining interest rate environment, the NII development will not always be linear due to timing mismatches between rate changes on our assets and liabilities, which was visible in the quarter. This is what we call timing effects in the interim report. Going forward, As policy rates are expected to be further reduced, we will continue to work in accordance with our pricing strategy, but bear in mind that private transaction accounts now have zero interest rate in all our home markets. Over to net commission income, which increased by 116 million mainly driven by stock market performance and day count effects in asset management. Underlying card commissions were seasonally higher. The introduction of a new service concept in Latvia resulted in higher commissions in service concepts and lower card commissions. Net gains and losses were strong and ended at 1.2 billion. FX and fixed income sales and trading performed well, and there were positive revaluations of interest rate swaps relating to the Swedish cover bond portfolio. Other income increased by 470 million. Net insurance income saw a large delta from revaluations. Last quarter, the effect was minus 82 million, while this quarter was plus 184 million, resulting in a delta of 266 million quarter over quarter. Income from associates increased by 162 million, of which Entercard benefited from a 120 million one-off adjustment in credit impairments. Total expenses. for the year are developing according to plan and the quarter ended lower by four hundred and eighty million due to lower consultancy costs after front-loading of initiatives in the first half of the year lower staff costs due to the hiring freeze taking effect on FTE levels, and the decrease was further amplified by seasonality and some one-offs such as VAT refund. As previously communicated, costs in the second half of the year will be close to the first half of the year, excluding any FX impact. The year to date FX headwind is around 150 million, reminding you that it's net positive on our P&L. Now over to you, Rolf, to talk about asset quality and credit impairments.