Summary: Swedbank AB

Retail banking market leader in Sweden, with a large customer base and wide distribution network. Strong risk-adjusted capital levels, reflecting the low risk profile of domestic operations. Strong earnings capacity. More concentrated exposure to its domestic market than peers. Greater reliance on wholesale funding than international peers. The negative outlook on Swedbank reflects S&P Global Ratings' view of heightened economic risks associated with growing economic imbalances in Sweden. We could lower the ratings in the next 24 months if the negative trends we see for Swedish economic risk lead us to revise down our anchor for banks operating in Sweden, including Swedbank, to 'bbb+' from 'a-'. Additionally, we could revise Swedbank's stand-alone credit profile (SACP) downward if, contrary to our

...Greater reliance on wholesale funding than international peers. Outlook: Negative The negative outlook on Swedbank reflects S&P Global Ratings' view of heightened economic risks associated with growing economic imbalances in Sweden. We could lower the ratings in the next 24 months if the negative trends we see for Swedish economic risk lead us to revise down our anchor for banks operating in Sweden, including Swedbank, to '###+' from 'a-'. Additionally, we could revise Swedbank's stand-alone credit profile (SACP) downward if, contrary to our current expectation, the bank is unable to maintain an S&P Global Ratings-adjusted risk-adjusted capital (RAC) ratio sustainably above 10%, our threshold for a strong capital and earnings assessment. We could revise the outlook to stable if we consider that the trend for economic risk affecting the Swedish banking sector had stabilized, particularly risks stemming from high house price appreciation and increases in private sector indebtedness....

Summary