2014 EU-wide Stress Test Summary for Svenska Handelsbanken AB (publ)
Core Information
Bank Name: SE - Svenska Handelsbanken AB (publ)
LEI Code: NHBDILHZTYCNBV5UYZ31
Reported Date: 31 December 2013
Summary: Adverse Scenario
Actual Figures as of 31 December 2013
Operating profit before impairments: 2,154 mln EUR
Impairment losses on financial and non-financial assets in the banking book: 134 mln EUR
Common Equity Tier 1 (CET1) capital: 10,027 mln EUR
Total Risk Exposure: 53,746 mln EUR
CET1 ratio: 18.7%
Outcome as of 31 December 2016
3-year cumulative operating profit before impairments: 4,248 mln EUR
3-year cumulative impairment losses: 1,909 mln EUR
3-year cumulative losses from the stress in the trading book: 129 mln EUR
Valuation losses due to sovereign shock: 0 mln EUR
CET1 capital: 10,886 mln EUR
Total Risk Exposure: 64,562 mln EUR
CET1 ratio: 16.9%
Memorandum Items
Common EU-wide CET1 Threshold (5.5%): 3,551 mln EUR
Total amount of instruments with mandatory conversion into ordinary shares (2014–2016): 0 mln EUR
Additional Tier 1 and Tier 2 instruments eligible for CET1 conversion or write-down: 0 mln EUR
Eligible instruments whose trigger is above CET1 ratio in the adverse scenario: 0 mln EUR
Summary: Baseline Scenario
Actual Figures as of 31 December 2013
Operating profit before impairments: 2,154 mln EUR
Impairment losses on financial and non-financial assets in the banking book: 134 mln EUR
CET1 capital: 10,027 mln EUR
Total Risk Exposure: 53,746 mln EUR
CET1 ratio: 18.7%
Outcome as of 31 December 2016
3-year cumulative operating profit before impairments: 6,592 mln EUR
3-year cumulative impairment losses: 937 mln EUR
3-year cumulative losses from the stress in the trading book: 24 mln EUR
CET1 capital: 12,484 mln EUR
Total Risk Exposure: 56,281 mln EUR
CET1 ratio: 22.2%
Memorandum Items
Common EU-wide CET1 Threshold (8.0%): 4,502 mln EUR
Exposure and Risk Breakdown (as of 31 December 2013)
F-IRB and A-IRB
Category
Non-defaulted
Defaulted
Exposure Values (F-IRB)
Exposure Values (A-IRB)
Exposure Values (STA)
Central banks and central governments
68.8%
0
52,094
0
19
Institutions
71.8%
0
250
1,751
64
Corporates
68.8%
0
694
5,537
2,666
Corporates - Of Which: Specialised Lending
0
0
22
14
0
Corporates - Of Which: SME
2,801
8
710
9,693
46
Retail
0
0
91,071
6,653
2,282
Retail - Secured on real estate property
0
0
79,639
4,305
1,350
Retail - Secured on real estate property - Of
68.8%
0
806
203
0
Retail - Secured on real estate property - Of
0
0
78,833
14
0
Retail - Qualifying Revolving
0
0
0
0
0
Retail - Other Retail
0
0
6,831
1,232
97
Retail - Other Retail - Of Which: SME
0
0
1,767
497
131
Retail - Other Retail - Of Which: non-SME
0
0
5,064
735
57
Equity
0
0
9,181
1,613
74
Securitisation
637
0
0
0
0
Other non-credit obligation assets
98
0
0
0
0
TOTAL
246
0
124,764
15,528
0
Securitisation and re-securitisations positions deducted from capital
Exposure values (F-IRB): 7,092 mln EUR
Exposure values (A-IRB): 27,312 mln EUR
Exposure values (STA): 2,348 mln EUR
Impairment and Coverage Ratios (Baseline Scenario)
Year
Impairment rate
Stock of Provisions
Coverage Ratio - Default Stock
2014
0.00%
0
-
2014
0.03%
3
19.80%
2014
0.17%
442
29.87%
2015
0.00%
0
-
2015
0.10%
215
31.82%
2015
0.08%
245
31.63%
2015
0.04%
40
10.42%
2015
0.28%
2
26.94%
2015
0.04%
38
10.04%
2016
0.00%
0
-
2016
0.03%
690
30.44%
2016
0.13%
847
34.86%
2016
0.08%
359
34.17%
2016
0.04%
138
17.28%
2016
0.08%
467
32.25%
2016
0.03%
23
9.49%
2016
0.09%
321
52.00%
2016
0.61%
79
55.51%
2016
0.26%
120
54.35%
2016
0.10%
1,325
33.73%
2016
0.08%
1,325
33.73%
2016
0.07%
592
30.78%
Impairment and Coverage Ratios (Adverse Scenario)
Year
Impairment rate
Stock of Provisions
Coverage Ratio - Default Stock
2014
0.00%
2
-
2014
0.05%
5
19.85%
2014
0.23%
528
28.97%
2015
0.00%
0
-
2015
0.12%
243
29.16%
2015
0.09%
234
32.40%
2015
0.07%
55
12.52%
2015
0.36%
3
27.78%
2015
0.05%
52
12.14%
2016
0.00%
0
-
2016
0.06%
14
25.45%
2016
0.34%
23
23.73%
2016
0.33%
219
55.32%
2016
0.62%
84
57.36%
2016
0.28%
79
54.13%
2016
0.04%
34
11.65%
2016
0.20%
3
26.97%
2016
0.04%
32
11.47%
2016
0.08%
138
17.28%
2016
0.28%
120
51.17%
2016
0.52%
57
52.80%
2016
0.20%
63
49.82%
2016
0.11%
348
28.41%
Key Findings
CET1 capital increased in both scenarios from 2013 to 2016, showing resilience of the bank in adverse and baseline conditions.
Impairment losses were higher in the adverse scenario than in the baseline scenario, reflecting the more severe stress conditions.
Operating profit before impairments was higher in the baseline scenario, indicating better performance under normal conditions.
Total Risk Exposure increased in both scenarios, with a greater rise under the adverse scenario.
CET1 ratio decreased in the adverse scenario from 18.7% to 16.9%, while it increased in the baseline scenario to 22.2%.
The bank did not have any mandatory conversions or instruments eligible for CET1 conversion or write-down during the period, suggesting a stable capital structure.
Valuation losses due to sovereign shock were zero in the adverse scenario, indicating no significant impact from such events.
