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Swedbank books YOY rise in Q4'16 profit despite increased oil-related provisions

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Swedbank books YOY rise in Q4'16 profit despite increased oil-related provisions

Swedbank AB (publ) reported fourth-quarter 2016 profit attributable to shareholders of the bank of 4.14 billion Swedish kronor, compared to the year-ago 3.81 billion kronor, boosted by higher net interest and commission incomes.

EPS improved to 3.70 kronor from 3.44 kronor in the year-ago quarter.

Net interest income increased to 6.25 billion kronor from 5.76 billion kronor in the fourth quarter of 2015. Net commission income rose to 3.06 billion kronor from 2.88 billion kronor.

Swedbank recorded credit impairments of 593 million kronor, up from 399 million kronor in the fourth quarter of 2015, primarily due to increased provisions within large corporates and institutions for oil-related commitments.

ROE reached 13.1% in the fourth quarter of 2016, up from 12.6% in the year-ago period.

For full year 2016, Swedbank reported profit attributable to shareholders of 19.54 billion kronor, up on a yearly basis from 15.73 billion kronor. Net gains and losses on financial items at fair value totaled 2.23 billion kronor, up from 571 million kronor, mainly because of improved net gains and losses on financial items within group treasury and the sale of Visa Europe to Visa Inc.

The lender's common equity Tier 1 capital ratio stood at 25.0% at 2016-end, compared to 23.8% at the end of September 2016 and 24.1% at 2015-end. The liquidity coverage ratio was 156% at the end of 2016, compared to 131% three months earlier and 159% at 2015-end.

Swedbank's board of directors proposed a dividend of 13.20 kronor per share for 2016, compared to 10.70 kronor per share a year ago. "Our capital position was further strengthened during the quarter," said CEO Birgitte Bonnesen.

"This has enabled the board of directors, for the fifth consecutive year, to propose that 75% of profit for the year be distributed to shareholders."

The dividend is expected to be paid out April 6.

As of Feb. 1, US$1 was equivalent to 8.76 Swedish kronor.