SEB's Financial Officers Survey - Slightly weak...

Optimism among Swedish financial officers remains strong even though business
conditions have weakened slightly since our last survey in February. At the same
time, profit expectations of companies have also weakened somewhat, possibly
implying that the benefits of cost savings from previous efficiency programs are
receding and that it is becoming more difficult for businesses to improve on
earlier quarterly results. In addition, managers are becoming increasingly
unsettled once again by the outlook for demand. The present decline in the index
value mainly reflects concerns regarding the development of credit spreads,
probably as a result of economic problems affecting several European countries
and their respective banking systems.

SEB's Financial Officers' survey, addressed to around 70 of Sweden's largest
companies, shows that respondents have remained optimistic during the spring,
even if confidence has declined slightly. SEB's Financial Officers Index for
Sweden published today stands at 62, down from 65 in February.

Stronger Swedish krona not critical for companies

"In this survey we asked financial officers of many of Sweden's leading export
oriented companies how further SEK appreciation would affect their financial
performance. Some 65 percent of respondents replied that the exchange rate was
not critical for their results, while 24 percent replied that the current
exchange rate was already problematic. SEB estimates that further modest SEK
appreciation, in line with SEB's forecasts, would pose few if any difficulties
for most companies", says Disa Hammar, credit analyst at SEB and co-author of
the report with Nina Glifberg.

Strong finances and increasing confidence in Sweden

"Financial officers' confidence in the financial position of their respective
companies remains strong, even if it has weakened slightly since February. Their
marginally less positive attitude is reflected in, among other things, an
increasing prioritisation of debt repayment in the event of a cash surplus.
Financial officers also signal a more optimistic view of Sweden than in
February. In particular, a greater share of officers would like to employ more
staff in Sweden. They would also prioritise strategic domestic investments, a
strategy motivated by the country's strong finances and economic growth", says
Hammar.

Increasing demand concerns

"Slightly fewer financial officers now expect profits for 2011 to grow compared
with 2010 for several possible reasons. Respondents are becoming increasingly
concerned over developments in demand, probably driven by the ongoing debt
crisis in southern Europe, the aftermath of the recent earthquake in Japan, and
the crisis in the Middle East and North Africa. Furthermore, Financial Officers
are now more worried about foreign competition and labour costs, due to the
strong Swedish krona. Companies also emphasise that they see fewer possibilities
for raising prices to offset higher raw material costs", says Hammar.

This is the twenty first publication of SEB's Financial Officers' Index Sweden.
The purpose of this unique survey is to reflect changes of sentiment in the
financial environment and facilitate the understanding of economic and financial
trends. The survey comprises a total of 15 questions covering areas such as
business climate, strategic investments, employment, views on currencies and
interest rates, financial strength, and lending attitudes amongst financial
institutions. The full report (in Swedish) is available at
www.sebgroup.com\press.

 For further information, please contact   Press contact
 Disa Hammar, Credit analyst               Elisabeth Lennhede, Press & PR
 + 46 8 506 232 69                         [phone]
 [e-mail]                        [e-mail]

                                           Ola Kallemur, Press officer
                                           +46 76 397 54 66
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Press release PDF: 


http://hugin.info/1208/R/1518442/454911.pdf

Disa Hammar: 


http://hugin.info/1208/R/1518442/454912.jpg




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Source: SEB via Thomson Reuters ONE

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