STOCKHOLM (Reuters) -Swedish banking group Swedbank on Wednesday set a target of at least 15% return on equity in the coming years, in line with a previous goal despite recent headwinds on interest
Swedbank sets returns target of at least 15%, to end hiring freeze
STOCKHOLM (Reuters) -Swedish banking group Swedbank on Wednesday set a target of at least 15% return on equity in the coming years, in line with a previous goal despite recent headwinds on interest income, and said it expected to abandon a freeze on hiring.
Sweden's biggest mortgage lender said in a statement it aimed to increase or maintain market shares for its main products while boosting efficiency across the group by harnessing new technologies, including AI.
The bank last set financial targets in December 2022, aiming to achieve a return on equity of 15% in 2025, a goal it met in both 2023 and 2024, but over the past year central bank rates have tumbled, putting a damper on bank interest income.
In addition, the war in Ukraine and simmering trade conflicts have clouded the outlook also for lenders.
"Geopolitical tensions are contributing to a level of global uncertainty we have not experienced in decades," Swedbank CEO Jens Henriksson said.
Henriksson said during a presentation to investors that he expected an external hiring freeze, put in place to keep a lid on costs more than a year ago, to be lifted. "But we will remain restrictive in new hiring," he added.
The rival of Nordic banks such as Handelsbanken, SEB and Nordea has built capital on the back of growing income in recent years and reverted to a higher payout policy earlier this year.
"We have no intention to hold more capital than necessary," Henriksson said.
(Reporting by Niklas Pollard, editing by Stine Jacobsen and Terje Solsvik)
