Financial Stability Report May 2011

The banks’ resilience has improved

…but there is still considerable uncertainty

Loan losses expected to be low Aggregated over four quarters. SEK billion. Fixed prices March 2011. Sources: The banks’ reports, SME Direkt and the Riksbank

Lending to households and companies Annual percentage change Source: Statistics Sweden

Fiscal unease Greece Ireland Portugal Spain Yields on ten-year government bonds. Per cent. Source: Reuters, EcoWin

High dependence on events abroad The major Swedish banks’ market funding via Swedish parent companies and subsidiaries. SEK billion Sources: Statistics Sweden and the Riksbank

The banks are well-capitalised in an international perspective Core Tier 1 capital ratios according to Basel II. December 2010. Per cent. Sources: The banks reports and the Riksbank

The banks can manage a much poorer outcome Solid columns refer to core Tier 1 capital ratio according to Basel III based on the Riksbank’s estimates. The striped columns refer to the core Tier 1 capital ratio according to Basel II. March 2011. Per cent Source: The Riksbank

The banks’ liquidity risks The survival period for Swedbank, Nordea, Handelsbanken and SEB compared with the average for a sample of European banks. Number of months. Sources: Liquidatum and the Riksbank

The banks should retain or increase their capital ratios The banks have increased their core Tier 1 capital ratio somewhat Fiscal unease Reasons for higher capital adequacy requirements than Basel III

The banks should reduce their liquidity and funding risks The banks have begun a transition to longer term funding Large dependence on short-term market funding

The banks should improve their public liquidity reporting The banks’ public liquidity reporting is still inadequate The banks should publish their liquidity risk once a month The banks should publicly report maturities and currency breakdowns for their assets and liabilities

Assessment of stability The banks’ resilience has improved… …but there is still considerable uncertainty