Handelsbanken Proposes 50% Bigger Dividend Payout

02/07/18 02:33 AM EST
By Dominic Chopping 
 

STOCKHOLM--Svenska Handelsbanken AB (SHB-B.SK), one of the Nordic region's largest lenders, posted a 9.2% rise in fourth-quarter net profit on Wednesday, missing forecasts, but said it is proposing a 50% rise in its dividend.

Net profit at the Stockholm-based bank rose to 3.76 billion Swedish kronor ($472 million) in the three months ending Dec. 31 from SEK3.44 billion in the same period a year ago, against expectations of SEK4.44 billion, according to an analyst poll by FactSet. Loan losses rose to SEK1.08 billion from SEK832 million.

The lender proposed an ordinary dividend of SEK5.50 a share and an extra dividend of SEK2.00 a share. In 2016 it paid a dividend of SEK5.00.

The lender's U.K. operation spent around SEK86 million during the year on Brexit-related expenses, but it said it sees opportunities for expansion and growing business volumes in the U.K.

Development costs and other expenses relating to Brexit are estimated to total SEK300 million for 2018.

"The IT development and other preparatory work that is now being carried out in the UK means that UK operations are expected to have an improved basis for maintaining their strong performance in the long term," it said in a statement.

Net-interest income in the fourth-quarter rose 6.5% to SEK7.77 billion from SEK7.3 billion a year earlier, while loan losses rose to SEK1.08 billion from SEK832 million.

The common equity Tier 1 ratio--a key measure of financial strength--was 22.7% at the end of the quarter, down from 25.1% a year earlier.

 

Write to Dominic Chopping at dominic.chopping@wsj.com; Twitter: @domchopping @WSJNordics

 

(END) Dow Jones Newswires

February 07, 2018 02:33 ET (07:33 GMT)

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