Adds CEO quote, detail from report
STOCKHOLM, Oct 20 (Reuters) - Swedish bank Swedbank SWEDa.ST on Tuesday reported a bigger-than-expected rise in net profit for the third quarter as strong stock market conditions and increased payment volumes helped it recover from the impact of the coronavirus pandemic.
Swedbank's third quarter net profit rose to 5.26 billion Swedish crowns ($596 million) from a year-ago 4.66 billion, beating the 4.32 billion analysts expected according to a Refinitiv poll.
"With the support of the strong stock market, net commission income is back to a normal level after a drop in the previous quarter," Chief Executive Jens Henriksson said in the report.
Loan losses, a figure closely watched due to a slump in the pandemic-hit wider economy, were 425 million crowns, worse than a year-ago 154 million but much better than the 732 million loss expected by analysts.
Interest income, which includes income from mortgages, increased to 6.71 billion crowns from 6.55 billion crowns a year ago, due to stable lending and deposit-taking activity.
Increased unemployment due to the pandemic will still likely mean some heavily indebted households may have trouble paying their mortgages.
Net commission income was only 2% down to 3.25 billion crowns from a year-ago 3.3 billion crowns, as payment income and the bank's asset management business performed well.
Total expenses fell to 4.8 billion crowns from 5.2 billion crowns, in line with its forecast as the bank continued to spend on anti-money laundering controls following a record fine from the FSA in March.
Gains on financial transactions increased to 669 million crowns from 457 million, amid strong demand for financial trading during the pandemic.
($1 = 8.8256 Swedish crowns)
(Reporting by Colm Fulton; editing by Niklas Pollard)
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