Swedbank net profit beats forecast amid market uncertainty

Swedish banking group Swedbank SWED_A reported a net profit for the second quarter that beat market expectations on Thursday but said the global economy remained marked by uncertainty with weakening activity in its main market Sweden.

The bank said in a statement its net profit for the period fell to 7.89 billion Swedish crowns ($810 million) from 8.60 billion a year ago but came in above a mean forecast of 7.18 billion in a LSEG poll of analysts.

Sweden's biggest mortgage lender published its results shortly after regional peer Nordea NDA_FI delivered a beat on earnings while domestic rivals SEB SEB_A and Handelsbanken SHB_A presented their reports on Wednesday.

Nordic banks have seen central bank rate cuts across the region weigh on interest over the past year while uncertainty over U.S. tariffs and any European retaliation has clouded the outlook for lenders and the economies they serve.

"In general, I'd say there's not exactly a wet blanket (over markets) but rather a wait-and-see attitude," CEO Jens Henriksson said in a call with reporters.

Swedbank said interest income, which includes revenues from mortgages, fell to 10.92 billion crowns from 12.17 billion a year earlier, narrowly topping the 10.90 billion seen by analysts, but costs also fell, down 5% year-on-year.

Commission income fell to 3.90 billion crowns from 4.17 billion a year earlier, below market expectations of 4.12 billion, while income from financial items, which includes trading, came in at 856 million versus 911 million a year ago.

"Net commission income fell due to the stock market downturn at the beginning of the quarter, which led to lower average assets under management," the bank said.

Loan losses have remained minor for Swedish banks despite headwinds in the country's real estate sector in recent years. Swedbank booked 150 million crowns of credit impairments compared to net recoveries of 289 million a year ago.

($1 = 9.7352 Swedish crowns)