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Swedish banks getting ready for a fight with the finance minister as the cash feast to take central stage.

Wednesday, 30 January 2013
After having reported a pretty strong results for 2012, Swedbank is promising to shower its shareholders with cash in the way of increased dividends. This has made the Swedish Finance Ministers, Anders Borg (pictured below) to raise his eye bows.

Ander Borg has not been a fan of the Swedish banks of recent after the minister's intense and regular criticism of the banks and their attitude towards money. Immediately, his mood will be to call for restraint within the banks as they start reporting larger intakes. The Board of Directors of Swedbank have proposes that dividends be almost doubled compared to the previous year following the banks higher profits. He had warned in November that he would not be in favour of banks handling out huge amounts of money to share holders.

About Skr10 billion will be distributed to the owners and the bank's CEO Michael Wolf, feels that there is no problem for the bank to pay out so much money.

"We have a capital base that is large enough to handle very stressful scenarios. It shows in the Riksbank's latest Financial Stability Report. Despite the dividend increase, we will continue to build equity between quarters," said Wolf to radio Sweden.

Swedbank made a very strong fourth quarter in 2012, see report here. Swedbank's Board of Directors proposes that the dividend payout should be raised from 50 percent to 75 of profit after tax. Per share its will be Skr 9.30 from Skr 5.30 a year ago.

Earlier this winter, the Finance Minister Anders Borg warned banks not shower themselves with all that much money. He would rather the banks keep the money in the companies to better withstand any future crises.

Even Sweden's largest bank Nordea also reported large profit, which was about Skr 9 billion in the fourth quarter. For the full year, profit was up by 16 percent to over Skr35 billion. Nordea maintains however, that its dividend policy remains unchanged at just over 40 per cent of profit after tax.
by Scancomrk.com Team

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