The ratings on Sweden-based Skandinaviska Enskilda Banken AB (SEB) reflect the group's well-diversified revenue base, underpinned by its very strong franchise in corporate and merchant banking in Sweden, its adequate capitalization, sustained profitability, and tight cost discipline. The ratings are further supported by SEB's good asset quality, although this could be threatened by negative prospects in the Baltic countries. Furthermore, the group's profitability is highly dependent on capital market-related revenues. Concentration on single large exposures remains a constraining ratings factor. With assets of Swedish krona (SEK) 2.15 trillion ($330 billion at SEK6.50 to $1) at Sept. 30, 2007, SEB ranks as the third-largest financial services group in the Nordic region. Its largest operations by assets are in Sweden and Germany,
