Skandinaviska Enskilda Banken (SEB) announced an increase in its shareholder payout for the fourth quarter. However, the Sweden-based bank also cautioned that the earnings boost from interest rates is beginning to subside.
In the fourth quarter, SEB reported a net profit of 8.37 billion Swedish kronor ($801.8 million), marking an increase from SEK7.4 billion in the previous year. However, this figure fell just short of the SEK8.76 billion forecasted by analysts polled by FactSet.
Net interest income experienced a 25% rise, reaching SEK12.1 billion, which was slightly lower than the expected SEK12.22 billion.
CEO Johan Torgeby stated, “After a year of exceptional macroeconomic circumstances, we are now starting to see a normalisation of our operating environment.” He also noted that “interest rates started to plateau towards the end of the year and the positive effect on our results experienced earlier in 2023 continued to abate.”
SEB has set a cost target of below or equal to SEK29 billion for 2024.
At the end of the quarter, the bank’s common equity Tier 1 ratio, a crucial indicator of financial strength, stood at 19.1%, up from 19.0% the previous year.
SEB has proposed an ordinary dividend of SEK8.50 per share, along with a special dividend of SEK3. Additionally, they have announced a new quarterly share buyback program worth SEK1.75 billion, running until the 2024 annual general meeting. The dividend for 2022 was SEK6.75.