· Carnegie Bank acquired HQ Bank on 3 September 2010. The bank was merged with Carnegie Bank on 30 September.
· Carnegie Holding signed an agreement to acquire HQ Fonder (currently Carnegie Fonder) on 3 September 2010. The acquisition was completed on 22 September.
· The acquisitions strengthen Carnegie’s market position within private banking and asset management.
· Carnegie strengthened its position within equity capital market transactions during the quarter.
· Carnegie was the only Nordic bank involved in Renault’s sale of Volvo shares, the largest-ever transaction on the secondary market in the Nordic region. In total, the trading in Volvo shares amounted to SEK 28 billion.
· Carnegie was number one in equity capital market (ECM) transactions in the Nordic region according to independent market statistics
· Financial data for Carnegie Bank (Jan. – Sept.)
· Income amounted to SEK 1,161m (973), an increase in all business areas in relation to 2009.
· Expenses before credit reserves amounted to SEK 588m (1,244). Items affecting comparability reduced costs by a net of SEK 497m.
· Pre-tax profit amounted to SEK 666m (loss: 269). Adjusted for items affecting comparability, pre-tax profit amounted to SEK 169m (loss: 170).
· Profit for the period amounted to SEK 603m (loss: 253).
· The capital ratio amounted to 20.1 percent by the end of the period.
· Financial data for Carnegie Holding (Jan. – Sept.)
· Income amounted to SEK 1,151m.
· Expenses before credit reserves amounted to SEK 634m. Items affecting comparability reduced expenses by a net of SEK 475m.
· Pre-tax profit amounted to SEK 610m. Adjusted for items affecting comparability, pre-tax profit amounted to SEK 135m.
· Profit for the period amounted to SEK 547m.
· The capital ratio amounted to 16.4 percent by the end of the period.
Renewed focus on private banking and savings products
With the acquisition of HQ Fonder (currently Carnegie Fonder) and HQ Bank, Carnegie’s operations were strengthened significantly. In a single stroke, the private banking operations in Sweden were doubled, and with the fund company, a top-class asset management operation was acquired. Overall, Carnegie became the largest independent player in the Nordic region.
The acquisition of HQ Bank took place under special circumstances when HQ Bank was a bank undergoing liquidation and was closed during the week prior to the acquisition. The uncertainty prevailing prior to the acquisition resulted in a number of HQ Bank customers requesting to transfer their deposit accounts. When Carnegie took over, all obligations to previous HQ Bank customers were guaranteed. Deposits transfers declined rapidly, and the flows could be reversed. The first phase of the integration was successful. All operations previously conducted under the HQ Bank name became part of Carnegie following the merger on 30 September.
Carnegie Fonder, previously HQ Fonder, has a strong and stable management team that has successfully built up a fund management operation focused on Sweden and growth markets. Its management operations fit very well in the Carnegie structure and provide the Group as a whole with access to new products and services. Overall, the acquired operations provide Carnegie with a greater proportion of stable income. The new Group has assets under management totalling more than SEK 110 billion.
The original Carnegie Bank Group continued to show a positive trend. Carnegie’s strong placement capacity was demonstrated through several equity capital market (ECM) transactions. One example of this was that Carnegie together with Goldman Sachs brokered the shares when Renault sold its holding in Volvo in the largest-ever secondary placing in the Nordic region, in which shares for SEK 28 billion changed owners.
Independent statistics show that the Investment Banking business area retained its leading position in ECM transactions during 2010 with respect to both the number of completed transactions and their value. Activity within mergers and acquisitions (M&A) and ECM transactions increased somewhat during the third quarter, compared with the same period in the preceding year. Carnegie took advantage of market conditions and won several mandates in all of the Nordic markets during the third quarter. The most recently announced transactions included initial public offerings of Pandora (Denmark) and Statoil Fuel & Retail (Norway), issues of corporate bonds for Seadrill (Norway) and Kungsleden (Sweden), a new share issue for Seawell (Norway) and M&A advisory services for Teracom (Denmark) and BW Offshore (Norway).
The Securities business area reported higher income in relation to the preceding year, primarily as a consequence of increased activity in the Norwegian and Swedish operations. At the same time, trading volumes on the exchanges remained low. Income in the Private Banking business area was in line with the preceding year, while profitability was increased due to lower expenses. The proportion of stable income grew with an increase in the share of discretionary mandates and increased assets under management. Following the acquisition of HQ Bank’s private banking operations, much effort was devoted to integration and creating an even stronger offering to existing and new clients.
Thus far, 2010 has been an eventful year for Carnegie in which we have strengthened our positions step by step within all business areas, in line with our ambition to be the Nordic region’s leading investment bank.
President and CEO
CBCIB Holding AB (“Carnegie Holding”) was newly established on 19 March 2009 in conjunction with the Altor and Bure’s acquisition of Carnegie Investment Bank (“Carnegie Bank”). The holding company’s operations consist of directly or indirectly owning, managing, issuing guarantees and loans to the banking operations and other Group companies associated with financial operations. All business operations within Carnegie take place within Carnegie Bank and Carnegie Fonder (previously HQ Fonder Sverige AB). Carnegie Holding is owned by Altor Fund III, the investment company Bure Equity AB, Investment AB Öresund and employees of Carnegie.
As of 1 June 2009, Carnegie Holding consolidates Carnegie Bank. As of 3 September 2010, operations previously conducted in HQ Bank AB were also included. On 30 September 2010, HQ Bank AB was merged with Carnegie Bank.
As of 22 September 2010, Carnegie Holding consolidates Carnegie Fonder AB (“Carnegie Fonder”).