Earnings quadrupled
The Handelsbanken Group's profit for the first quarter of 1994 was SEK 1 235M, almost four times that for the corresponding quarter of the previous year. The quarterly results for 1993 were SEK 316M, 452M, 517M and 516M.

Return on equity after tax went up to 16.7% (5.2).

Earnings per share increased to SEK 3.74 (1.08).

Result before loan losses
The result before loan losses was SEK 2 074M (2 136).

Net interest income decreased by 13%, mainly because of falling lending volumes and shrinking net interest margins.

Commission increased by 22% as investment banking commission continued to rise.

Other income included rental income of SEK 105M (50) from the property subsidiary, Fastighets AB Näckebro, and capital gains of SEK 189M (86) on bond sales.

Expenses rose by 1%. This increase is explained by higher personnel expenses, mainly because of contractual salary increments - the number of employees fell by over 100. Other expenses decreased by 3% as a result of lower premises and computer costs.

Loan losses fall sharply
Loan losses were more than halved to SEK 839M (1 820). This corresponds to 1.2% (2.4) of lending.

Problem loans also fell steeply to SEK 8 482M (13 741) after provision for possible loan losses. On 31 December 1993, problem loans were SEK 9 706M.

The volume of property taken over to protect claims fell slightly compared to 31 December 1993.

Capital cover
The Handelsbanken Group's capital cover was 13.1% (12.9 at year-end). The primary capital ratio was 9.0% (8.8 at year-end).

Stockholm, 25 April 1994

Arne Mårtensson
President and Group Chief Executive

Profit and loss account
Svenska Handelsbanken Group	January-March
	1994	1993	Change
	SEK m	SEK m	%
Net interest income 1)	2 292	2 643	- 13
Commission	784	641	+ 22
Other income	391	228	+ 71
Total income	3 467	3 512	- 1
Personnel expenses	741	705	+ 5
Other expenses
Other expenses	652	671	- 3
Total expenses	1 393	1 376	+ 1
Profit before loan losses	2 074	2 136	- 3
Loan losses	839	1 820	- 54
Operating profit	1 235	316	+ 291
1) Interest income	7 856	9 588	- 18
Interest payable	5 564	6 945	- 20
A preliminary allocation of SEK 30M to the profit-sharing foundation Oktogonen is included in personnel expenses for 1994. Personnel expenses at 31 March 1993 have been increased by SEK 29M (1/4 of the allocation which was made at the end of 1993) compared to the interim report at 31 March 1993. Apart from this, minor changes have been made in the accrual of personnel expenses. The figures for 1993 have been adjusted accordingly.
There were no extraordinary items in 1993 or 1994.

Balance Sheet
Svenska Handelsbanken Group	1994	1993
	31 March	31 March	Change
	SEK m	SEK m	%
Government securities and bonds	95 944	55 018	+ 74
Lending	257 308	289 000	- 11
Banks	34 778	32 454	+ 7
Other	40 284	34 178	+ 18
Total assets	428 314	410 650	+ 4
Funding	180 267	184 907	- 3
Deposits	181 482	163 621	+ 11
Other liabilities	33 236	33 837	- 2
Subordinated loans	10 981	10 991	- 0
Shareholders' equity	22 348	17 294	+ 29
Total liabilities and shareholders' equity	428 314	410 650	+ 4
As from 1994, holdings of housing bonds within the Group are not eliminated. (Volumes for 1993 have been corrected). Lending includes lending to the general public and financial institutions other than banks as well as leasing assets. Dividend for 1993 - SEK 470M - is reported under other liabilities in 1994.
Shareholders' equity includes 72% (70) of other untaxed reserves and reported operating profit for the first quarter.

Non-performing loans for which interest is reported as income, problem loans and property taken over to protect claims
	1994	1993	1993
	31 March	31 Dec	31 March
	SEK m	SEK m	SEK m
Non-performing loans for which interest is not reported as income	1 732	1 821	1 871
Problem loans:
- Non-performing loans where interest is reported as income until payment has been made	11 403	11 848	14 363
- Loans where the interest rate has been lowered relative to market interest rates	3 614 1)	4 734	5 471
- Minus: Reserve for possible loan losses	- 6 535	- 6 876	- 6 093
- Total problem loans after allocation to reserve for possible loan losses	8 482	9 706	13 741
Property taken over to protect claims:
- Shares	1 646	1 651 2)	135 2)
- Property	6 890	7 005	3 778
- Total property taken over	8 536	8 656	3 913
1) This includes loans of SEK 2 484M where a provision has been made for possible loan losses.
2) Excl. shares in Nobel Industrier, which yield market return.

Key figures for the Group
	January-March
	1994	1993
Return on shareholders' equity after standard national tax (28% 1994, 30% 1993)	16.7%	5.2%
Income/expenses (I/E ratio)
- before loan losses	2.49	2.55
- after loan losses	1.55	1.10
Earnings per ordinary share 1), SEK	3.74	1.08
- April 1993 - March 1994, SEK	8.69
- April 1992 - March 1993, SEK	- 0.53
1) After 28% (30) standard national tax and full conversion of convertible subordinated notes.

Profit and loss account
Svenska Handelsbanken	January-March
	1994	1993	Change
	SEK m	SEK m	%
Net interest income 1)	1 891	2 263	- 16
Commission	784	609	+ 29
Other income	259	159	+ 63
Total income	2 934	3 031	- 3
Personnel expenses	648	612	+ 6
Other expenses	570	582	- 2
Total expenses	1 218	1 194	+ 2
Profit before loan losses	1 716	1 837	- 7
Loan losses	687	1 697	- 60
Operating profit	1 029	140	+ 635
1) Interest income	5 432	7 310	- 26
Interest payable	3 541	5 047	- 30
A preliminary allocation of SEK 29M to the profit-sharing foundation Oktogonen is included in personnel expenses for 1994. Personnel expenses at 31 March 1993 have been increased by SEK 27M (1/4 of the allocation which was made at the end of 1993) compared to the interim report at 31 March 1993. Apart from this, minor changes have been made in the accrual of personnel expenses. The figures for 1993 have been adjusted accordingly.
There were no extraordinary items in 1993 or 1994.

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

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