Nordea moves its headquarter from Sweden to Finland to save EUR 1 billion

12.10.2017 | 3 min lukea

Scandinavian Bank Nordea relocates its company domicile from Sweden to Finland next year. With this move Nordea tries to evade the strict supervision guidelines installed by Swedish regulators. Nordea calculates the savings with about EUR 1 billion achieved with the relocation. In future the bank will be supervised by the European Central Bank.

Sweden’s government has passed different strict regulations regarding capital markets and has now considered implementing higher taxes for banks. Nevertheless the former nationalized bank was profitable. Nordea’s balance sheet equals four times of Sweden’s gross domestic product. With the relocation the bank wants to save costs of EUR 1 billion and avoid stricter regulation.

Nordea’s chairman Björn Wahlroos said to newspaper Financial Times that “we see the move as an important strategic step in positioning Nordea on a par with its European peers. The level playing field and predictable regulatory environment offered by the banking union are, we believe, in the best interest of Nordea’s customers, shareholders and employees”.

Nordea with good half year results

Nordea’s first half-year net revenue increased by 5.0 Percent to EUR 10,787 Million over the first half-year 2016. The bank reported a net income of EUR 3,484 Million which equals a net income margin of 32.3 percent. Earnings per share equal EUR 0,86 and Nordea is about to pay a dividend of approximately EUR 0,66 EUR per share.

At the moment Nordea shares are traded at EUR 11.52 (11.10.2017). The share price reached its annual high at EUR 11.97 (17.07.2017) and its annual low at EUR 10.10 (11.01.2017). Bloomberg analysts noted a price-earnings-ratio of 13.13. 10 analysts rated Nordea on Buy, 13 on Hold and 4 on Sell. On top, Nordea has a current dividend yield of 5.64 percent. Nordea’s current market capitalization equals EUR 46,670 Million Euro. Nordea has said to keep dividend policy the same. Bloomberg analysts expect a twelve-month share price target of EUR 12.00 and a dividend of EUR 0,70 per share in 2018. However the future development remains to be seen.

A leading financial services company in Northern Europe

Nordea is a Nordic financial services corporation which operates in Northern Europe and the Baltic area. The bank was a merger between Finnish, Danish, Norwegian and Swedish banks. Located in Stockholm, Sweden Nordea has over 10 million personal customers and more than half a million corporate customers. The bank is organized in four business areas – Personal Banking, Commercial and Business Banking, Wholesales Banking and Wealth Management.

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