GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Swedbank AB (OTCPK:SWDBY) » Definitions » Financial Strength

Swedbank AB (Swedbank AB) Financial Strength : 3 (As of Mar. 2024)


View and export this data going back to 1998. Start your Free Trial

What is Swedbank AB Financial Strength?

Swedbank AB has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.

Warning Sign:

Swedbank AB displays poor financial strength. Usually, this is caused by too much debt for the company.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

GuruFocus does not calculate Swedbank AB's interest coverage with the available data. Swedbank AB's debt to revenue ratio for the quarter that ended in Mar. 2024 was 13.75. Altman Z-Score does not apply to banks and insurance companies.


Swedbank AB Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Swedbank AB's Interest Expense for the months ended in Mar. 2024 was $-1,720 Mil. Its Operating Income for the months ended in Mar. 2024 was $0 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2024 was $94,871 Mil.

Swedbank AB's Interest Coverage for the quarter that ended in Mar. 2024 is

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Swedbank AB's Debt to Revenue Ratio for the quarter that ended in Mar. 2024 is

Debt to Revenue Ratio=Total Debt (Q: Mar. 2024 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(0 + 94870.958) / 6899.428
=13.75

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Altman Z-Score does not apply to banks and insurance companies.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Swedbank AB  (OTCPK:SWDBY) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Swedbank AB has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.


Swedbank AB Financial Strength Related Terms

Thank you for viewing the detailed overview of Swedbank AB's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Swedbank AB (Swedbank AB) Business Description

Address
Landsvagen 40, Sundbyberg, Stockholm, SWE, 172 63
Swedbank is one of the oldest banks in Sweden, where it derives the lion's share of its income. The bank is the result of merging savings and union banks in Sweden in the aftermath of the financial crisis in the early 1990s in Sweden. The remaining independent savings banks in Sweden remain in close collaboration with Swedbank, acting as an additional product distribution channel to Swedbank and sharing Swedbank's IT systems and part of its development costs. In addition, the bank operates in the three Baltic states: Estonia, Latvia, and Lithuania. Swedbank has a market-leading position in the Baltics, with share ranging from 20% to 55% in retail banking, where it generates 16% of revenue.