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SEB boss, Annika Falkengren does not rule out job cuts

Wednesday, 28 September 2011
One of the biggest challenges for the banking sector over the next few years is clearer ground rules, says SEB's CEO Annika Falkengren. She does not rule out job cuts, although the bank has already implemented major cutbacks.

At a seminar organized by the Royal Academy of Engineering Sciences, IVA, on Wednesday Annika Falkengren stressed once again how well prepared the bank stands today compared to when the financial crisis hit in 2008.

"We have prepared ourselves to the teeth, "said Falkengren pointing to the liquidity buffer of almost Skr500 billion and that the core capital ratio increased to 13.5 percent.

One of the biggest challenges over the next few years are clear rules for the banking sector, according to Annika Falkengren and pointed to the importance of clearer regulation of the capital and liquidity buffers are required.
The Riksbank and the government have advocated tougher requirements on capital than the Basel III requires. The reasons put forward include that the banking system in Sweden is large relative to GDP, concentrated, and that funding is highly dependent on foreign countries.

In late November, when the next stability report will be presented, the Riksbank has promised to explain what is meant by more stringent requirements on the Swedish banks than what Basel III requires.

Several analysts have argued that Swedish banks could soon be forced into major cutbacks and layoffs, like Nordea, in order to show profits and growth as the economy slows down and it gets tougher capital requirements. Nordea is expected this year to cut its workforce by 2000 services in the Nordic countries.

Annika Falkengren says that SEB now is working for efficiency than to make major staff cuts. But she does not rule out that the workforce would be reduced.
"We cut out 500 employees in 2009, Nordea did not. But then I think to keep the costs down, this means that there would be fewer employees in 2014 than we have today. This also depends on how we grow. "

SEB has previously announced that Skr3 billion will be saved the next few years, and that the bank’s costs are to be frozen also for 2012 and 2013 at last year's level of Skr24 billion.
By Scancomark.se Team

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