This report does not constitute a rating action. What's new: Skandinaviska Enskilda Banken (SEB) faces regulatory headwinds and capital pressures following the Swedish Financial Supervisory Authority’s (SFSA) identification of systemic deficiencies in its internal ratings-based models for certain corporate and non-household exposures. While the SFSA imposed a Pillar 2 add-on already in 2023 (1% of the risk exposure amount), a 2026 review determined that model shortcomings were more extensive than previously assessed. This will temporarily increase SEB’s capital requirements by an estimated Swedish krona (SEK) 10 billion (€883 million), effective Dec. 31, 2026. The recent assessment coincides with a shift in the SFSA’s treatment of model deficiencies, moving it to Pillar 1 from Pillar 2. Together this results in an
