Swedbank downgraded to Hold from Buy at Jefferies

Jefferies downgraded Swedbank to Hold from Buy with a price target of SEK 204, down from SEK 242. The firm transferred coverage of the Nordic banks to a new analyst. A mix of below consensus pre-provision profits, higher credit losses and lower capital distributions leads Jefferies to question whether these banks deserve their premium multiples, the analyst tells investors in a research note. The firm’s research questions the sustainability of Nordic banks’ premium valuations based on the “highly leveraged” Swedish household sector, balance sheet provisions and risks to pre-provision profits.