Many Swedish small savers took the opportunity to buy bank shares in March, despite the global wave of concern about financial problems in the banking sector in particular, writes online broker Nordnet in a press release.
“Pressed rates even for the big Swedish banks have made savers press the buy button. Handelsbanken is the favorite in March, but Swedbank and Nordea are also in the buying top,” writes Frida Bratt, savings economist at Nordnet, in a comment.
Rising risk premiums
“One interpretation is that savers see the big Swedish banks as stable and robust, and that they are considered somewhat unfairly to have been dragged down in the turmoil. Furthermore, dividends, which the banks give generously, are appreciated even more in times of turmoil on the stock market,” she adds .
The shares of the major Swedish banks recovered during the week, but fell heavily on March 9-10 and again on March 22.
The price falls were linked to rising risk premiums for banks’ funding in the wake of several high-profile so-called bank runs in the US and the deep crisis of confidence in long-established Swiss bank Credit Suisse – which ended with larger rival UBS rescuing the bank from collapse, at a heavily discounted price and with large government guarantees.
Selected as the winner
Handelsbanken’s share is after the price declines in March since the turn of the year at minus 11 percent. For SEB and Swedbank, it is minus 4.7 and plus 0.9 percent, respectively, while Finland’s Nordea – whose share is also listed on the Stockholm Stock Exchange – is unchanged since the turn of the year.
Earlier in the year, the major banks were singled out by many observers as winners of the sharp interest rate hikes that followed increased key interest rates to push down the unusually high inflation.