Risk and capital adequacy
All financial operations entail risks. Managing them well is critical for Swed Bank. The basis of efficient risk management and a good risk-adjusted return is a strong, consistent risk culture with delegated responsibility and decision-making close to the customer.
Maintaining stable earnings over time requires not only a low risk level, where each borrower’s solvency, solidity and collateral are the determining factors, but also the ability to quickly adapt to changing customer behaviour and other market factors. Swed Bank shall maintain a sustainable balance between deposits and lending and aims to match all maturities. Our priority is sustainable growth.
Risk and capital adequacy reports
Shareholders have an interest in a high return on the capital they invest in the bank and thus in ensuring that shareholders’ equity is not unnecessary high. For creditors and society, on the other hand, it is important that the bank maintains a sufficient buffer, or risk capital, to cover potential losses. The capital adequacy rules therefore set minimum requirements on the size of the buffer based on how much risk the bank assumes.
On 1st of January 2014 the capital adequacy rules Basel 3 came into effect in Sweden, replacing Basel 23. The rules strengthens the link between risk taking and capital requirements and entails, among other things, stricter requirements on banks concerning risk management and information disclosure.