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Svenska Handelsbanken AB Class A Stock Quote SHB A

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Morningstar's Svenska Handelsbanken AB Class A Stock Analysis

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Handelsbanken's Q2 Shows Mixed but Decent Underlying Performance; Loan Losses Low Again

Niklas Kammer, CFA Equity Analyst

Analyst Note

| Niklas Kammer, CFA |

Narrow-moat Handelsbanken reported operating profits SEK 5,246 million for its second quarter, down 20% versus last quarter. However, cleaned for a SEK 1,059 million one-off sales gain during the first quarter, operating profit only declined about 5%. Net losses on financial transactions of SEK 147 million versus a gain of SEK 240 million last quarter further weighed on an otherwise decent but mixed underlying performance. We have marginally increased our fair value estimate to SEK 115 per share from SEK 112 after refreshing our model as we did not see a cause to materially change our assumptions after this earnings release. The primary driver of the slight increase in fair value estimate was the time value of money since our last model update.

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Company Profile - SHB A

Business Description

Handelsbanken is one of the largest Swedish banks with significant exposure to the Swedish mortgage market; about 44% of total loans are tied to the Swedish real estate market. Outside of Sweden, the bank operates primarily in the U.K. and Netherlands. Handelsbanken generates about three fourths of its income through its interest spread-based business, including mortgages, household loans, and corporate loans to large and small enterprises. The bank increasingly offers asset-management, mutual fund and private banking services to its clients.

Contact
Kungstradgardsgatan 2
Stockholm, SE-106 70, Sweden
T +46 87011000
Industry Banks - Diversified
Most Recent Earnings Jun 30, 2022
Fiscal Year End Dec 31, 2022
Stock Type
Employees 10,791

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