Swedbank profit rises 15% quarter on quarter as credit loss provisions reversed by 701 million kronor
Key Facts
Swedish lender Swedbank's net profit rose 15% in the third quarter of 2026 from the previous quarter, according to results released on October 22, as earnings benefited from a reversal of credit loss provisions. The bank reported net profit of 8,249 million Swedish kronor, compared with 7,195 million kronor in the second quarter, marking a quarterly improvement in earnings. The result exceeded the net profit forecast of 8,144 million kronor, according to an analyst consensus table published by Infront on the bank's website and dated mid-October. That comparison relates to third-quarter estimates, while the reported growth rate reflects a comparison with the previous quarter's actual results. Profit before tax totalled 10,541 million kronor in the third quarter, according to the bank's financial disclosure. Diluted earnings per share were 7.30 kronor for the same period.
On revenue, Swedbank said total income reached 17,986 million kronor in the third quarter, with both interest and commissions contributing to its business results. Net interest income totalled 11,568 million kronor during the period, exceeding the net commission income disclosed by the bank. Net commission income was 4,704 million kronor, forming part of the total income reported in the quarterly results. On spending, total expenses reached 7,417 million kronor, including exceptional costs of 673 million kronor during the same period. The cost-to-income ratio was 0.41, according to the results metrics published on the bank's investor relations page. These figures set quarterly revenue against the expenses incurred by the bank, including the exceptional items recorded in its accounts.
On credit, Swedbank recorded a net reversal of credit loss provisions of 701 million kronor in the third quarter, supporting the quarterly result. The bank had announced an agreement in September to sell an Entercard non-performing loan portfolio to B2 Impact and Intrum. Describing the portfolio's size at the time, it said "the non-performing loan portfolio amounts to approximately 4 billion Swedish kronor," outlining the scope of the assets covered by the agreement. When announcing the deal, the bank expected a positive impact of around 0.5 billion kronor from the revaluation of expected credit losses. It said that impact would be recognised in its accounts in the third quarter, while completion of the portfolio sale was scheduled for a later period.
The quarterly improvement follows a year-on-year decline in the bank's second-quarter profit, according to Investing.com coverage published when those results were announced. Net profit fell 9% at the time to around 7.20 billion kronor, the result for the period preceding the current third-quarter results. In the trading session following the July results announcement, Swedbank shares fell more than 2%, amid cost pressures and interest income missing expectations, according to the same coverage. Among its third-quarter metrics, the bank reported a return on equity of 15.6%, alongside its quarterly profit and income figures. Its common equity tier 1 capital ratio was 17.2%, according to the investor relations page, presenting its capital level alongside the return generated during the period.
On next steps, Swedbank said when announcing the Entercard agreement that completion of the non-performing loan portfolio sale was expected during the final quarter of the year. Closing remains subject to customary closing conditions and regulatory approvals, according to the deal statement. The bank expected the sale to reduce net interest income by around 100 million kronor annually after the transaction, against the expected positive impact from the revaluation of credit losses. On financial disclosures, the bank's calendar set January 27, 2027 as the release date for its full-year results. The report will cover the financial year from January to December 2026, according to the date published on Swedbank's financial calendar page.