Handelsbanken Ulf Riese, CFO

Handelsbanken Ulf Riese, CFO Morgan Stanley European Financials Conference 2 April 2009 Handelsbanken Financial target – focus on profitability Handelsbanken’s financial goal is to have a higher return on equity than a weighted average of comparable listed Nordic and British banks This should be achieved through: More satisfied clients Lower costs than peers The financial goal has been reached for 37 consecutive years 2 Handelsbanken Higher profitability than the average for comparable banks Return on shareholder’s equity, 1973 - 2008 % Handelsbanken Other Comparable banks* 30 25 20 15 10 5 0 -5 1973 1978 1983 1988 1993 1998 2003 2008 Return on shareholder's equity after standard tax. * Since 2003 the comparable banks are: SEB, Nordea, Swedbank, Danske Bank samt DnB NOR. 3 Handelsbanken Business model Decentralisation Nonnegotiable Credit policy No central No bonus Business control system marketing Responsibility and Accountability Customer The branch No budget is the bank 4 Handelsbanken We have more satisfied customers Customer satisfaction – private customers Handelsbanken Sector average, weighted Index Sweden Index Denmark 80 85 75 80 70 75 70 65 65 60 60 55 55 50 50 2001 2002 2003 2004 2005 2006 2007 2008 2001 2002 2003 2004 2005 2006 2007 2008 Index Finland Index Norway 85 75 80 70 75 70 65 65 60 60 55 55 50 50 2001 2002 2003 2004 2005 2006 2007 2008 2002 / 2004 2005 2006 2007 2008 Source: SKI, Dansk KundeIndex, EPSI Rating and EPSI Norway. 2003 5 In Sweden, the sector average comprises SEB, Nordea and Swedbank. Handelsbanken We are the most cost-effective bank Cost/income-ratio before loan losses, Jan – Dec 2008 Weighted average % excl. Handelsbanken Handelsbanken 45 DnB NOR 51 Nordea 54 Swedbank 51 Danske 61 SEB 63 Adjusted for items affecting comparability 56 6 Handelsbanken Respect for risks is a cornerstone Credit responsibility Credit responsibility always at branch level Customer and credit responsibility closely related The branch holds full economic responsibility for granting the credit If necessary, the branch obtains support from the regional head office and central credit department Basic guidelines The assessment start with the borrower’s repayment capacity Weak repayment capacity can never be offset by collateral or high margins Quality requirements must never be neglected in favour of large volume Credits must normally be adequately secured 7 Handelsbanken Lower loan losses than peers Loan loss as a percentage of lending, 1994 - 2008 Handelsbanken Other Nordic banks* % 1,75 1,50 1,25 1,00 0,75 0,50 0,25 0,00 1994 1996 1998 2000 2002 2004 2006 2008 -0,25 * For the years 1994-2000, only Swedish banks. 8 Handelsbanken Handelsbanken Group Market shares in Sweden, Jan 2007 – Dec 2008 Keeping our credit policy unchanged tends to lead to reduced market shares in corporate lending at the top of the cycle Lending to non-financial companies in Sweden Deposits from households in Sweden 30% 18,0% 17,7% 29% 29,0% 17,5% 28% 27% 27,0% 17,0% 26% 26,1% 25% 16,5% 24% 16,0% 23% 15,7% 16,0% 22% 15,5% 21% 20% 15,0% jan-07 apr-07 jul-07 okt-07 jan-08 apr-08 jul-08 okt-08 9 Source: Statistics Sweden (www.scb.se) Handelsbanken Stable finances and strong liquidity Capital target Handelsbanken aims to have a well-balanced capitalisation. The Bank’s goal is that the Tier 1 capital ratio in Basel II must be between 9% and 11%. Outcome At the year-end, the Tier 1 ratio was 10.5%, according to Basel II. Total capital adequacy amounted to 16.0%. 10 Handelsbanken Secure a strong liquidity Net lender to the Swedish central bank as well as in the Swedish krona interbank market SEK m 60 000 Year-end liquidity reserves of over SEK 300 bn 50 000 40 000 30 000 20 000 10 000 0 v 01 v 04 v 07 v 10 v 13 v 16 v 19 v 22 v 25 v 28 v 31 v 34 v 37 v 40 v 43 v 46 v 49 v 52 11 2008 Handelsbanken Rating is important Moody's rating Long Long as of 11 March 2009 BFSR* Term BFSR* Term Handelsbanken B Aa1 HSBC Bank plc C+ Aa2 Banco Bilbao Vizcaya Argentaria B Aa1 KBC Bank C+ Aa3 Banco Santander B Aa1 Lloyds TSB C+ Aa3 BNP Paribas B Aa1 Standard Chartered Bank C+ A2 Credit Suisse B Aa1 UniCredit Bank Austria C+ Aa2 Deutsche Bank B Aa1 Nordea Bank B Aa1 Allied Irish Banks C Aa3 Bank of Ireland C Aa3 Credit Agricole B- Aa1 Barclays Bank plc C Aa3 DnB NOR B- Aa1 Danske Bank C Aa3 Intesa Sanpaolo Spa B- Aa2 Erste Bank der Oest.Spark. C Aa3 SEB B- Aa2 Société Générale B- Aa2 Bayerische Hypo- & Vereinsb. C- A1 UBS B- Aa2 Commerzbank C- Aa3 Royal Bank of Scotland plc C- Aa3 Swedbank C- A1 HBOS plc A1 * Bank Financial Strength Ratings Moody's Bank Financial Strength Ratings (BFSRs) represent Moody's opinion of a banks intrinsic safety and soundness and, as such, exclude certain external credit risks and credit support elements that are addressed by Moody's Bank Deposit Ratings 12 Handelsbanken Handelsbanken Group Q4 2008 – Best quarter ever Q4 Q3Change SEK m 2008 2008 % Net interest income 5,474 4,856 Net fee and commission income 1,694 1,656 Net gains/losses on financial items at fair value 2,229 483 Risk result - insurance 50 55 Other income 65 74 Total income 9,512 7,124 Staff costs -2,170 -2,015 Other expenses -1,430 -1,118 Total expenses -3,600 -3,133 Profit before loan losses 5,912 3,991 Loan losses, net -696 -231 Disposal prop. equipmt./ intang. assets 0 -2 Operating profit 5,216 3,758 39 13 Handelsbanken Handelsbanken Group Key ratios Q4 Q3 Jan-Dec 2008 2008 2008 RoE total operations, actual tax 24.0% 15.4% 16.2% RoE total operations, after standard tax 20.0% 15.1% 15.0% C/I-ratio, before loan losses continuing 37.8% 44.0% 44.3% operations Earnings per share total operations, SEK 7.31 4.51 19.46 Capital ratio, Basel II 16.0% 15.2% 16.0% Tier I ratio, Basel II 10.5% 10.0% 10.5% Change Q4 Tier I ratio, SEK m 5,074 14 Handelsbanken Conclusion – Stick to your knitting The essence of our business model is that it should work in both good and bad times. For Handelsbanken, sticking to the model is the key when navigating through the current crisis 15 Handelsbanken.

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