Swedbank gets approval to buy back SEK 10 billion tier 2 bonds

By Melissa Kory

Cleveland, Feb. 17 - Swedbank AB said it received permission from the Swedish Financial Supervisory Authority for the early redemption and buyback of up to SEK 10 billion of subordinated tier 2 debt securities.

The bank said that it is working to manage its capital, adding that it has until April 15 to complete the redemptions.

Affected bonds are listed in the table below and amount to roughly SEK 16 billion in terms of outstanding amount. Holders have the right to exercise early redemption during 2011 and 2012.

Swedbank has also been granted approval to redeem its SEK 685 million of tier 2 bonds with ISIN SE0001659665 on Feb. 28.

Swedbank does not plan to issue any new subordinated debt to replace the purchased securities. The bank's focus in securing stability in its balance sheet is on its core tier 1 capital. Since mid-2008 Swedbank has increased its core tier 1 ratio to 13.9% as of December.

Swedbank Markets and Bank of America Merrill Lynch will handle the buybacks.

The financial services company is based in Stockholm.

Affected tier 2 bonds

ISIN Amount

XS0069782406 ¥10 billion

W94253AD8 $50 million

XS0080222838 $105 million

XS0257529296 £120 million

XS0269222591 $75 million

XS0276165346 €136 million

XS0300645180 $400 million

XS0322614420 €382 million

NO0010404643 NOK 156 million

SE0001800905 SEK 89 million

SE0001800913 SEK 1.89 billion

SE0001877739 SEK 600 million

SE0002268417 SEK 725 million

SE0002288381 SEK 374 million

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