April 30, 2019 / 6:11 AM / 4 months ago

UPDATE 1-Strong trading gains help SEB beat profit forecast

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STOCKHOLM, April 30 (Reuters) - Swedish banking group SEB reported first-quarter operating profit above market expectations on Tuesday and called for joint initiatives between banks, regulators and authorities to combat money-laundering.

SEB’s operating profit in the quarter rose to 5.86 billion Swedish crowns ($616 million), beating a mean forecast for 5.54 billion in a Reuters poll and compared with 5.26 billion in the year-ago period.

Results were lower on both interest income and fee income, widely regarded as the two most important sources of income for the bank, but were helped by better-than-expected financial income, which includes trading.

The Nordic banking sector has been rocked by recent money-laundering scandals, with both rival Swedbank and Denmark’s Danske Bank accused of failing to prevent suspicious funds from flowing through their Estonian operations.

SEB, the second biggest bank in the Baltics after Swedbank, has also faced questions about its money-laundering safeguards. It said on Tuesday it couldn’t guarantee that it would never be used for criminal activity.

“However, we are doing our utmost to prevent, detect and report suspicious cases,” the lender said in its report.

Net interest income, which includes income from mortgages, rose to 5.35 billion crowns from 5.22 billion a year ago, but was lower than the 5.41 billion expected in the poll.

Net commission income fell to 4.29 billion crowns from 4.85 billion a year ago and missed consensus of 4.47 billion.

Net financial income was 2.12 billion crowns, up from 1.51 billion in the year-ago period and higher than the 1.48 billion expected. ($1 = 9.5088 Swedish crowns) (Reporting by Johan Ahlander, editing by Esha Vaish and Darren Schuettler)

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