The risk that the bank’s results, equity or value will decrease due to changes in risk factors in financial markets. Market risk includes interest rate risk, currency risk, share price risk and commodity risk, as well as risks from changes in volatility and correlations.
Risk profile
Swedbank’s market risks are generally considered low. The main market risks are of a structural or strategic nature and relate to the interest rate risk that arises as a natural part of the Group’s operations e.g. when customers demand different fixed interest terms on deposits and loans. In addition, market risks arise in the financial products that the bank offers to meet customer needs.
Risk management
Swedbank centralises all interest rate risk to a few risk-taking units (i.e. units that have received a risk mandate from the CEO) for the purpose of managing this risk efficiently, partly by matching maturities and partly using derivatives.