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Profits slashed at SEB

Swedish banking group SEB saw operating profits nosedive in the second quarter, mainly due to credit losses and write downs on investments in the Baltic States and Russia.

Published: 20 July 2009 08:22 CEST

The company’s second quarter operating profits were 618 million kronor. This compares to a profit of 3.5 billion kronor in the same period in 2008. The results were significantly worse than analysts had expected. According to a Reuters survey, the market had expected operating profits of 2.1 billion kronor.

SEB’s credit losses for the period were 3.6 billion kronor, compared with 448 million kronor in the same period last year. The bank revealed that it had made write downs for all goodwill relating to its investments in the Baltic states and Russia. The total value of the write downs was 2.4 billion kronor.

Operating profit excluding credit losses was 4.2 billion kronor, a slight increase on the second quarter last year. Operating income increased by 27 percent to 13.2 billion kronor. Net interest income was up 21 percent. Costs rose to 9 billion kronor, compared with 6.4 billion in the second quarter last year.

CEO Annika Falkengren was bullish about the results:

“SEB generated overall strong income growth and strengthened its customer franchise, particularly within wholesale banking,” she said, adding that the bank’s “robust balance sheet” and strong capital ratio would help reinforce its position in the current economic difficulties.

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BANK

Deutsche Bank to pay $130m to settle US bribery probes

Deutsche Bank will pay $130 million to settle a foreign bribery probe and fraud charges in precious metals trading, US officials announced on Friday.

Published: 9 January 2021 15:08 CET
Deutsche Bank to pay $130m to settle US bribery probes
A woman walks past the offices of Deutsche Bank in London. Photo: Tolga Akmen / AFP
The bribery case relates to illegal payments and to false reporting of those sums on the bank's books and records between 2009 and 2016, the Department of Justice said in a press release.
   
The bank “knowingly and wilfully” kept false records after employees conspired with a Saudi consultant to facilitate bribe payments of over $1 million to a decision maker, the DOJ said.
   
In another case, the bank paid more than $3 million “without invoices” to an Abu Dhabi consultant “who lacked qualifications… other than his family relationship with the client decision maker,” the DOJ said.
   
In addition to criminal fines and payments of ill-gotten gains, Deutsche Bank agreed to cooperate with government investigators under a three-year deferred prosecution agreement.
 
   
In the commodities fraud case, Deutsche Bank metals traders in New York, Singapore and London between 2008 and 2013 placed fake trade orders to profit by deceiving other market participants, the DOJ said.
   
The agreement took into account Deutsche Bank's cooperation with the probes, DOJ said.
   
“Deutsche Bank engaged in a criminal scheme to conceal payments to so-called consultants worldwide who served as conduits for bribes to foreign officials and others so that they could unfairly obtain and retain lucrative business projects,” said Acting US Attorney Seth D. DuCharme of the Eastern District of New York.
   
“This office will continue to hold responsible financial institutions that operate in the United States and engage in practices to facilitate criminal activity in order to increase their bottom line.”
   
“We take responsibility for these past actions, which took place between 2008 and 2017,” said Deutsche Bank spokesperson Dan Hunter, adding that the company has taken “significant remedial actions” including hiring staff and upgrading technology to address the shortcomings.
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