Read news from:
Austria
SHARE
COPY LINK

MONEY

Handelsbanken to close more than 100 branches across Sweden

Swedish bank Handelsbanken is set to close almost half of its branches in Sweden, in a bid to cut costs.

Published: 16 September 2020 16:54 CEST
Handelsbanken to close more than 100 branches across Sweden
Handelsbanken said more and more of its customers were using digital banking. Photo: Vilhelm Stokstad/TT

Handelsbanken joins the ranks of lenders downscaling their physical presence in face of growing digitalisation in the sector.

It said in a statement that it plans to reduce the number of branches in Sweden to 200 from around 380 at present in a bid to cut costs to 20 billion Swedish kronor (1.9 billion euros, $2.3 billion) by the end of 2022.

The closures will affect some 1,000 employees – or one in seven of its domestic workforce – over the next two years, the statement said.

Negotiations were currently under way with trade unions, but Handelsbanken said it would set aside 1.5 billion kronor in its fourth-quarter accounts “to facilitate these adjustments”.

At the same time, the group said it would invest 1.0 billion kronor over the next two years “in order to take its digital customer offering to an entirely new level”.

“We're currently observing that customers are using digital channels and other means to meet up, rather than in our branches,” chief executive Carina Akerstrom told SVT public television.

Unlike its Nordic competitors, Handelsbanken has until now set great store by its bricks-and-mortar presence on the high street.

Rival Swedbank, for example, currently has only 160 branches in Sweden.

In addition to its domestic workforce of 7,000, Handelsbanken also employs 5,000 staff outside Sweden, notably in Britain, Denmark and Finland.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

MONEY

How to protect your Swedish savings when the stock market tumbles

Recent stock market developments have made consumers in Sweden worried about the savings they have invested in the market.

Published: 5 August 2024 14:44 CEST
How to protect your Swedish savings when the stock market tumbles

Stock market volatility can be unsettling, especially when it hits close to home.

On Monday, the Stockholm stock exchange mirrored global market turmoil, with the OMXS index dropping 4.8 percent in morning trading. By 11 am, there was a slight recovery, but the index remained 2.6 percent down.

READ MORE: Stockholm stock exchange opens in the red amid global market jitters

Big names in Swedish industry weren’t spared: Boliden, a major mining company, dropped 3 percent, defence giant Saab fell 1.5 percent, and engineering firm Sandvik declined by 2.6 percent. In the banking sector, SEB took a 2.4 percent hit, while Swedbank dropped 3.6 percent.

This turbulence in the Swedish market came after significant drops in Japan’s Nikkei 225 index, which experienced its most significant one-day fall since the 1987 Black Monday Crash, and similar declines in markets across South Korea, Frankfurt, London, and anticipated losses on Wall Street.

In these uncertain times, many Swedish consumers with money invested in the market wonder whether they should do something to safeguard their savings.

Avoid impulsive decisions, expert warns

Stock market volatility can raise concerns about the safety of your savings, but according to SEB household economist Américo Fernández, there’s no need to panic.

“Should they be worried? I mean, no. I would say that this is how the stock market works: there’s a lot of uncertainty and risk connected,” he told The Local. 

“When you have savings on the global stock exchanges, this will happen, especially when we’ve had at least six months of really, really good returns – maybe even too good. Then, this is a little bit expected.

“But of course, it’s always dramatic when we have such developments in the stock market in just one or two days.”

Slow and steady wins the (investment) race

For those wondering how to protect themselves against such crashes, Fernández emphasised a consistent and steady approach to investing.

“The most common thing, the best strategy for the broad masses, is to save on a monthly basis. And this is what many Swedes do; our surveys show that 9 out of 10 Swedes save on the stock market every month. This is precisely what you should do: invest in a mutual fund, which is quite common in Sweden,” he said.

“In circumstances such as these, you buy more at a lower price, instead of timing the stock market, which is almost impossible, continue your monthly investments through mutual funds. That’s a good way of diversifying your portfolio.”

READ ALSO: Will the krona’s decline stop Riksbank from cutting rates?

Ignore the alarmist headlines

The SEB household economist also advised against reacting hastily to alarming headlines.

“Another thing that households should be aware of is that when you see alarming headlines, you should sit and calmly ride the wave out.

“It’s understandable that a lot of people are affected by herd mentality when we have these negative headlines. Everyone, but especially households with tiny savings, acts and sells, and then they buy again when the headlines are positive, when the stock exchange is at high levels…

“That is the opposite of what you should do. Try to neglect these things and be cool in these circumstances, even though it seems bad and hurts your wallet. However, if it hurts your wallet too much, that might be a signal that you have too much money in the stock market (laughs), which can be common for younger investors. Although they have had it pretty good recently,” he noted.

This advice is not only applicable to Sweden but also relevant across Scandinavia, according to Fernández.

“I think it’s applicable. Across Scandinavia, all Nordic countries save a lot of money on the stock exchange, partially because the pension system isn’t fully funded by the government,” he said.

SHOW COMMENTS