Bonds are melting SEB capital
14.10.2008, 11:23SEB bank has problems with it’s bond
portfolio, possible loss can be up to SEK 7.7 bln aripaev.ee mediates Svenska
Dagbladet.
That would melt bank’s equity capital even faster that loan losses from
Baltic countries.
SEB has large bond portfolio, which may cost much for the
bank. SEB has already announced of losses in amount of SEK 2.4 bln in
quarter results presented in April. In the first half-year results bank wrote
off smaller amounts. In Q3 the financial crisis is sharper and losses may grow.
“I estimate the losses in Q3 may be up to SEK 3 bln. It’s very large amount,
but doesn’t threat bank’s payment capability,” said Rodney Alfvén, banking
analyst from Cheuvreux Nordic.
Ranking agency Standard Poor's warns as well, that bank may face the
problems. Agency lowered bank’s outlook from stable to negative and besides
Baltic loan losses it points to risk that losses from bond portfolio may grow.
S P estimates that SEB may lose 10 pct of its share capital in 2008.
According to Svenska Dagbladet calculations it is SEK 7.7 bln.
Value of SEB’s bond portfolio was worth SEK 126 bln in the beginning of the
year.
SEB estimates possible loan losses for next year in Baltic to amount 1
pct of loan portfolio, which means SEK 1.4 bln.