SBAB's net operating income for the first half of 2007 totalled SEK 418 million

SBAB's net operating income for the first half of 2007 totalled SEK 418 million

SBAB's net operating income for the first half of 2007 totalled SEK 418
million (SEK 376 million). The increase in net operating income is
explained by lower expenses and lower positive net loan losses compared
with the corresponding period last year.
- The residential mortgage market is characterised by very stiff
 competition and strong pressure on margins. Despite this, SBAB has
succeeded in improving its result, says Eva Cederbalk, CEO.
Results
SBAB's net operating income for the first half of 2007 totalled SEK 418
million (SEK 376 million). The increase in net operating income is
explained by lower expenses and lower positive net loan losses compared
with the corresponding period last year. Net interest income totalled
SEK 612 million (SEK 628 million). The residential mortgage market is
characterised by very stiff competition and a clear downward marginal
trend. Net interest income has been positively affected by higher
interest rates, which have increased
interest income on invested equity capital and payment flows. Operating
income is in level with the corresponding period last year, SEK 685
million (SEK 689 million).
During the first half year, expenses totalled SEK 289 million (SEK 318
million), a
decrease of 9 %. Compared with the corresponding period last year,
SBAB's development costs and staff costs have decreased.
The SBAB group applies IFRS, International Financial Reporting Standards
from1 January 2007.
Loan portfolio and securitised loans

                 Jun 2007 Jun 2007          Dec 2006 Dec 2006
SEK billion      Total    Of which          Total    Of which
                          securitised loans          securitised loans
Retail market    103.9                      103.8     
Corporate market 65.8     0.01)             66.2     7.4
Total            169.7    0.0               170.0    7.4
1) Repurchased May 2007
Lending
During the first half of the year, new lending to the retail market was
lower than the corresponding period last year. New lending to the retail
market totalled SEK 10,673 million (SEK 15,314 million) in the first
half of the year. The retail market portfolio now totals SEK 103,875
million, SEK 103,806 million at the turn of the year. SBAB's partners
continue to be important distribution channels.
New lending to the corporate market increased to SEK 5,294 million (SEK
3,122 million).
The corporate market portfolio amounts to SEK 65,785 million, SEK 66,207
million at the turn of the year. This decrease is explained by lower
lending to the municipalities and to tenant-owner associations.
Savings
In April, SBAB expanded its range of products to also include saving for
private customers. Initially, two account products were offered: A
savings account for both new and existing customers and the SBAB account
with an especially favourable interest rate for customers with
residential mortgages of SEK 1 million or more. Interest is paid from
the first krona deposited regardless of the amount deposited and
withdrawals are free of charge. An account can easily be opened through
sbab.se or customer services.
Funding
SBAB considers it very important to have a well-diversified funding
portfolio. This requires an active presence in the market and a flexible
range of products. As at 30 June, the portfolio consisted of the
following: Swedish Commercial Paper Programme SEK 20.2 billion (SEK 18.2
billion), Swedish Covered Bonds SEK 51.9 billion (SEK 47.0 billion),
European Commercial Paper Programme USD 1,910 million (USD 1,440
million), US Commercial Paper Programme USD 2,104 million (USD 1,813
million), Euro Medium Term Note Programme USD 7,782 million (USD 9,292
million), Euro Medium Term Covered Note Programme EUR 3, 992 million
(EUR 2,486 million). The total value of outstanding securities issued
was SEK 189.8 billion (SEK 182.3 billion).
The issuance of covered bonds is done through SBAB's wholly-owned
subsidiary The Swedish Covered Bonds Corporation. The credit rating
institutes Moody's and Standard & Poor's have set a credit rating of
Aaa/AAA for the covered bonds issued.
Further information:
Eva Cederbalk, CEO, SBAB
Telephone: +46 8 614 43 01
Mobile: +46 70 523 23 02
E-mail: eva.cederbalk@sbab.se
Lena Hedlund, Chief Communication Officer, SBAB
Telephone: +46 8 614 38 49
Mobile: +46 708 58 07 25
E-mail: lena.hedlund@sbab.se
Per Balazsi, Chief Financial Controller, SBAB
Telephone +46 8 614 43 24
Mobile: +46 733 68 43 24
E-mail: per.balazsi@sbab.se