Profits and return on equity continue to increase
The Handelsbanken Group's result for January - September 1993 was a profit of SEK 1 389 million (-883). The result for each of the first three quarters of 1993 was SEK 351 486 and 552 million respectively.

Return on equity after 30% tax increased to 7.6% (-4.7).

Earnings per share went up to SEK 4.67 (-2.79).

Earnings capacity even stronger
The result before loan losses increased by 30% to SEK 6 670 million (5 116). Total operating income rose by 17%. Net interest income was up by 10%, mainly because of a shift in lending from foreign currency to Swedish kronor and higher net yield on the bond portfolio. The margin between lending and deposit interest rates in Swedish kronor fell gradually during the year.

Commission rose by 9%, particularly investment banking commission, while international commission fell somewhat compared to the exceptional period of comparison last year. Under other income, rental income in the Bank's property company Fastighets AB Näckebro was SEK 215 million (51) and capital gains on bond sales in the investment portfolio were SEK 400 million (80).

Total expenses, not including loan losses, fell slightly. Personnel expenses were down by 2%. The average number of employees during the three quarters fell by 354 to 7 073. Other expenses rose by 2% mainly because of increased system development costs and the depreciation of the Swedish krona.

The income/expenses ratio before loan losses rose from 2.28 to 2.67.

Loan losses down
Loan losses fell by 12% to SEK 5 281 million (5 999). On a full-year basis, these losses represent 2.6% of lending volume.

Problem loans after allocation for possible loan losses decreased to SEK 12.4 billion or 4.5% of lending volume.

Property taken over to protect the Bank's claims increased as more real estate was transferred to Fastighets AB Näckebro.

A specification of non-performing loans for which interest is reported as income, problem loans and property taken over to protect claims can be found in conjunction with the Group's balance sheet.

Rights issue
The subscription period for the Bank's rights issue expired on 22 October. As a result of the issue, 75.6 million new shares have been created and new capital amounting to SEK 2 646 million before deduction for issue costs has been put into the Bank.

0.9% of the subscription rights have not been utilised by holders of ordinary shares. Of these, holders of preference shares who have submitted an application to subscribe have been allocated shares in relation to their holdings of preference share capital, in accordance with the Bank's Articles of Association. After this distribution, only 0.14% of the subscription rights remained. The Board has resolved that these will not be allocated to subscribers without pre-emption rights. In this way, these subscription rights can be said to benefit all shareholders.

Capital cover
The Group's capital cover at the end of the quarter was 10.2% (10.1% at last year-end), not including in the capital base the Bank's rights issue or this year's result. After the rights issue and the result for the year so far, the capital base is just over SEK 30 billion and capital cover 12.4%.

Most satisfied customers for fifth year in a row
Sweden's Kundbarometer, a major customer survey, was presented in October. It shows that for the fifth year in a row, Handelsbanken's customers are more satisfied than those of the other banks included in the survey and that the lead on bank number two has increased. This applies to both private and corporate customers. 25 000 customers in over 100 companies have been interviewed. The survey is part of a larger research project carried out by the Stockholm School of Economics in collaboration with the University of Michigan.

Stockholm, November 2, 1993

Arne Mårtensson
President and Group Chief Executive

Key figures for the group
	January - September
	1993	1992
Return on equity	7.6%	- 4.7%
Income/expenses (I/E ratio)
- before loan losses	2.67	2.28
- after loan losses	1.15	0.91
Earnings per share 1), SEK	4.67	- 2.79
- October 1992 - September 1993, SEK	4.86
- October 1991 - September 1992, SEK	-1.23
1) Before extraordinary items, after 30% standard national tax and after full conversion of convertible notes. Adjusted for rights issue.

Profit and loss account
Svenska Handelsbanken Group	January - September
	1993	1992	Change
	SEK m	SEK m	%
Net interest income 1)	7 542	6 835	+ 10
Commission	2 032	1 863	+ 9
Other income	1 079	411	+ 163
Total operating income	10 653	9 109	+ 17
Personnel expenses	1 997	2 042	- 2
Other expenses	1 986	1 951	+ 2
Total expenses	3 983	3 993	- 0
Result before loan losses	6 670	5 116	+30
Loan losses	5 281	5 999	- 12
Operating profit	1 389	- 883	-
Extraordinary items	-	- 17
Result before appropriations and taxes	1 389	- 900
1) Interest income	27 298	30 856	- 12
Interest expenses	19 756	24 021	- 18
When determining the comparative figures for 1992, loan losses have been calculated as three-quarters of those for the whole year. Other items have been adjusted to equal the total of the figures for the first eight months and a quarter of the figures for the third four-month period.
No allocation was made to the profit-sharing foundation Oktogonen in 1992. For this reason, the preliminary allocation made in the interim reports for 1992 has been reversed.

Profit and loss account
Svenska Handelsbanken	January - September
	1993	1992	Change
	SEK m	SEK m	%
Net interest income 1)	6 447	5 801	+ 11
Commission	1 952	1 721	+ 13
Other income	773	354	+ 118
Total income	9 172	7 876	+ 16
Personnel expenses	1 736	1 781	- 3
Other expenses	730	1 683	+ 3
Total expenses	3 466	3 464	+ 0
Result before loan losses	5 706	4 412	+29
Loan losses	4 744	5 313	- 11
Net operating profit/loss	962	- 901
Extraordinary items	-	-
Result before appropriations and taxes	962	- 901
1) Interest income	19 554	22 908	- 15
Interest payable	13 107	17 107	- 23

Balance sheet
Svenska Handelsbanken Group	30 Sept	31 Dec
	1993	1992	Change
	SEK m	SEK m	%
Government securities and bonds	48 346	41 917	+ 15
Lending	273 300	283 372	- 4
Banks	30 272	34 925	- 13
Other	43 651	32 996	+ 32
Total assets	395 569	393 210	+ 1
Funding	156 849	170.860	- 8
Deposits	170 362	160 476	+ 6
Other liabilities	38 700	33 251	+ 16
Subordinated loans	11 213	11 550	- 3
Shareholders' equity	18 445	17 073	+ 8
Total liabilities and shareholders' equity	395 569	393 210	+ 1
Lending includes lending to the public and financial institutions other than banks, and leasing assets. Any adjustments in the value of the investment portfolio and other allocations are only included in the accounts for the whole of 1993. Shareholders' equity for 1992 is exclusive of dividend to the shareholders and for 1993 includes 70% of the reported operating profit.

Non-performing loans for which interest is reported as income, problem loans and property taken over to protect claims
	1993	1993	1992
	30 Sept	30 June	31 Dec
	SEK m	SEK m	SEK m
Non-performing loans for which interest is reported as income	2 165	2 533	2 421
Problem loans:
- Non-performing loans where interest is not reported as income until payment has been made	13 785	14 568	12 167
- Loans where the interest rate has been lowered relative to market interest rates	5 557	5 406	6 391
- Minus: Reserve for possible loan losses	- 6 964	- 6 716	- 5 499
- Total problem loans after allocation to reserve for possible loan losses	12 378	13 258	13.059
Property taken over to protect claims:
- Shares 1)	1 517	1 500	219
- Property	7 070	4 870	3 289
- Total	8 587	6 370	3 508
1) excl. shares in Nobel Industrier, which yield market return.

This interim report has not been examined by the Bank's auditors.

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