DBRS rates Swedbank debt A (high)

DBRS said it assigned A (high) senior unsecured debt and deposits ratings and R-1 (middle) short-term debt and deposits ratings to Swedbank AB and AAA long-term and R-1 (high) short-term ratings to all of its debt that is guaranteed by the Swedish government.

The trend on all ratings is stable.

The agency has designated Swedbank as a critically important banking organization in Sweden. As such, its ratings are subject to a floor, which is A (high) for long-term debt and deposits and R-1 (middle) for short-term debt and deposits at the bank level.

DBRS said Swedbank boasts a strong Swedish banking franchise, with a leadership position in retail banking and a strong position in corporate lending and deposits, and it maintains leading positions in each of the three Baltic countries and is active in Ukraine and Russia.

Swedbank's ongoing negative operating performance reduces its intrinsic strength, the agency said. Large impairments for loan losses in the Baltics and Ukraine caused losses in each of the first three quarters of 2009. DBRS anticipates continued and significant pressure on earnings given the expectation that the Baltic and Ukrainian economies will remain stressed, new lending volume will remain low and credit costs will remain high.

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